THEY WERE supposedly set up to uplift the lives of those in need. Yet in their first few months of operation, they served a rather different, yet specific, purpose: to promote the candidacy of two legislative aspirants who eventually won and are now occupying seats in the Senate.
Senator Joseph Victor ‘JV’ G. Ejercito of the United Nationalist Alliance (UNA) and Senator Mary Grace Poe-Llamanzares of Team PNoy were each supported during the campaign by organizations formed in their name: JV Para sa Bayan Movement Inc. and the Friends of Grace Poe Foundation Inc., respectively.
These two non-stock associations were registered in the Securities and Exchange Commission (SEC) close to and right at the start of the campaign period — JV Para sa Bayan on Dec. 14, 2012 and Friends of Grace Poe on Feb. 15, 2013. The names of these foundations immediately emerged as major donors of the two candidates, buying ads in bulk in the thick of the campaign.
Read the full story: Foundations for elections
The creation of foundations during an election cycle or even prior to the elections, of course, is no longer surprising to Commissioner Christian Robert S. Lim of the poll body’s Campaign Finance Unit (CFU) and Commissioner Kim S. Jacinto Henares of the Bureau of Internal Revenue (BIR). Henares even notes that historically, many foundations have been set up in the name of politicians such as Friends of Mar for Interior and Local Government Secretary Manuel ‘Mar’ A. Roxas II and the Yellow Ribbon Movement for President Benigno Simeon ‘Noynoy’ C. Aquino III.
Lim says, however, that foundations, just like any other campaign donor, are bound by campaign-finance rules. For instance, he says, a foundation is not allowed to buy airtime for a particular candidate without the candidate’s consent or acceptance. Foundations are also not allowed to receive money from prohibited contributors such as public or private financial institutions, entities that hold government contracts, civil servants, and foreigners and foreign corporations, among others.
Under revenue regulations, a non-stock association or a foundation may enjoy certain tax exemptions if it applies for and is issued a tax exemption certificate by the tax authority. She ticks off two basic requirements a foundation must meet for this: one, it must be registered with the Securities and Exchange Commission (SEC), and two, it must get an accreditation from the BIR to determine its exemption.
Take the case of Friends of Grace Poe Foundation. Its incorporation papers say that it was formed to promote the advocacies of Mary Grace Poe; to help those who are much in need; to undertake medical missions and other projects; and to exercise all powers provided under Section 36 of the Corporation Code. Yet it has emerged as paying for the majority of Poe’s campaign advertisements. The latter was borne out by various advertising contracts and broadcast orders gathered by PCIJ from the Education and Information Department (EID) of the Comelec.
Election laws also require media entities to submit a series of advertising documents to the Comelec at certain deadlines during and after the campaign period. One such set of documents shows that advertiser Friends of Grace Poe, broadcast network ABS-CBN, and agency Mejah Inc. entered into an advertising contract worth P5.11 million on April 22, 2013. This contract is composed of 20 15-second TV ads that were supposed to be aired from April 27, 2013 to May 6, 2013. The advertising contract bears the signature of Grace Poe accepting the donation made by Friends of Grace Poe.
Poe-Llamanzares reported receiving 60 separate donations, 11 of which were made by six companies or non-individuals, in the Statement of Election Contributions and Expenditures (SOCE) she filed with Comelec nearly a month ago. Friends of Grace Poe, however, was not among the donors she listed in her SOCE.