The Court of Appeals (CA) dismissed the appeal filed by the municipality of San Nicolas in Ilocos Norte province and finalized the decision of the Regional Trial Court (RTC), which nullified the imposition of taxes on GMA Network Inc. on the use of municipal aerial wealth.

In 2009, GMA was imposed with a P35,000 fee by the San Nicolas municipal treasurer for the use of municipal aerial wealth after installing antenna towers and building a relay station, which are essential parts of its television broadcast system, in the area. The fee was assessed under Section 2, Article F, Chapter 6 of the 2008 Revenue Code of San Nicolas, Ilocos.

GMA paid the said fee on June 1, 2009 under protest on the grounds that it already paid regulatory fees to the National Telecommunications Commission (NTC) under Executive Order (EO) No. 546, and that the municipality’s imposition of fees for the use of aerial wealth is already covered by another law in violation of the Local Government Code.

The Municipal Treasurer denied said protest stating that the charge of aerial wealth on GMA’s broadcast operations falls within the authority of the municipality to impose.

In an eight-page decision penned by Judge Conrado Ragucos of the Ilocos Norte RTC, the provision of the Revenue Code of San Nicolas, imposing a fee on relay stations, was declared null and void in view of the order, which puts imposition of charges on the operation of broadcasting organizations and its facilities such as antenna towers or relay stations under the jurisdiction of the NTC. According to RTC Judge Ragucos, the order, being a general law, is superior in status to municipal ordinances such as the Revenue Code of San Nicolas.

Furthermore, the RTC said that the ownership of the aerial space above the territory of San Nicolas does not belong to the municipality. Under the EO No. 546, regulation of air lanes, which have to be allocated as there are more individuals who want to broadcast than there are frequencies to assign, falls under the responsibility of the NTC.

The CA dismissed the appeal filed by the Municipal Government of San Nicolas for the failure of the appellant to file the required brief within the reglementary period.