Romualdez-Marcos vs COMELEC

TITLE: Romualdez-Marcos vs. COMELEC

CITATION: 248 SCRA 300

FACTS:

Imelda, a little over 8 years old, in or about 1938, established her domicile in Tacloban, Leyte where she studied and
graduated high school in the Holy Infant Academy from 1938 to 1949. She then pursued her college degree, education, in
St. Pauls College now Divine Word University also in Tacloban. Subsequently, she taught in Leyte Chinese School still in
Tacloban. She went to manila during 1952 to work with her cousin, the late speaker Daniel Romualdez in his office in the
House of Representatives. In 1954, she married late President Ferdinand Marcos when he was still a Congressman of
Ilocos Norte and was registered there as a voter. When Pres. Marcos was elected as Senator in 1959, they lived together
in San Juan, Rizal where she registered as a voter. In 1965, when Marcos won presidency, they lived in Malacanang
Palace and registered as a voter in San Miguel Manila. She served as member of the Batasang Pambansa and Governor
of Metro Manila during 1978.

Imelda Romualdez-Marcos was running for the position of Representative of the First District of Leyte for the 1995
Elections. Cirilo Roy Montejo, the incumbent Representative of the First District of Leyte and also a candidate for the
same position, filed a Petition for Cancellation and Disqualification" with the Commission on Elections alleging that
petitioner did not meet the constitutional requirement for residency. The petitioner, in an honest misrepresentation, wrote
seven months under residency, which she sought to rectify by adding the words "since childhood" in her
Amended/Corrected Certificate of Candidacy filed on March 29, 1995 and that "she has always maintained Tacloban City
as her domicile or residence. She arrived at the seven months residency due to the fact that she became a resident of
the Municipality of Tolosa in said months.

ISSUE: Whether petitioner has satisfied the 1year residency requirement to be eligible in running as representative of the
First District of Leyte.

HELD:

Residence is used synonymously with domicile for election purposes. The court are in favor of a conclusion supporting
petitoners claim of legal residence or domicile in the First District of Leyte despite her own declaration of 7 months
residency in the district for the following reasons:

1. A minor follows domicile of her parents. Tacloban became Imeldas domicile of origin by operation of law when her
father brought them to Leyte;

2. Domicile of origin is only lost when there is actual removal or change of domicile, a bona fide intention of abandoning
the former residence and establishing a new one, and acts which correspond with the purpose. In the absence and
concurrence of all these, domicile of origin should be deemed to continue.

3. A wife does not automatically gain the husbands domicile because the term residence in Civil Law does not mean
the same thing in Political Law. When Imelda married late President Marcos in 1954, she kept her domicile of origin and
merely gained a new home and not domicilium necessarium.

4. Assuming that Imelda gained a new domicile after her marriage and acquired right to choose a new one only after the
death of Pres. Marcos, her actions upon returning to the country clearly indicated that she chose Tacloban, her domicile of
origin, as her domicile of choice. To add, petitioner even obtained her residence certificate in 1992 in Tacloban, Leyte
while living in her brothers house, an act, which supports the domiciliary intention clearly manifested. She even kept
close ties by establishing residences in Tacloban, celebrating her birthdays and other important milestones.

WHEREFORE, having determined that petitioner possesses the necessary residence qualifications to run for a seat in the
House of Representatives in the First District of Leyte, the COMELEC's questioned Resolutions dated April 24, May 7,
May 11, and May 25, 1995 are hereby SET ASIDE. Respondent COMELEC is hereby directed to order the Provincial
Board of Canvassers to proclaim petitioner as the duly elected Representative of the First District of Leyte.


ROMUALDEZ-MARCOS v COMELEC

FACTS:

The petitioner, Imelda Romualdez-Marcos, applied as a candidate to contest elections to the House of Representatives in
the district of Leyte. The incumbent representative of the constituency of Leyte, Cirilo Roy Montejo (a candidate for the
same position) applied
to Commission on Elections [COMELEC] to have Imelda Romualdez-Marcoss application rejected on the grounds that it
did not meet the constitutional requirement for residency. The constitutional requirement for residency for election
purposes stated that in order to contest a position, the candidate must have resided in the location for which they are
standing for a period of one year or more. The purpose of the provision was to prevent the possibility of strangers or
newcomers who were unacquainted with the needs of a community standing for office. In her original application form,
Imelda Romualdez-Marcos had stated that she had resided in Leyte for seven months. In response to the complaint fled
by Cirilo Roy Montejo she amended the time of residency in her application from seven months to since childhood. She
claimed that the entry of the word seven in her original Certifcate of Candidacy was the result of an honest
misinterpretation, which she now sought to rectify. She further stated that she had always maintained Tacloban (in the
district of Leyte) as her domicile or residence. COMELEC, after considering the petition of Cirilo Roy Montejo to have the
candidacy of Imelda Romualdez-Marcos rejected, found the claim meritorious and refused the petitioners original
application for candidacy and her amended version. COMELEC rejected the petitioners application for candidacy on the
basis that her conduct revealed that she did not intend to make Tacloban her domicile, that she had registered as a voter
in different places, and on several occasions had declared that she was a resident of Manila. COMELEC stated that
although she spent her school days in Tacloban she had abandoned residency when she chose to stay and reside in
other places. Imelda Romualdez-Marcos subsequently appealed to the Supreme Court requesting a declaration that she
had been a resident, for election purposes, of the First District of Leyte for a period of one year at the time she applied to
contest the 1995 elections.

She argued that the meaning of residency in the Constitution, which designated the requirements for candidacy for
election purposes, was that of domicile. She argued that she had domicile in Leyte because that was her place of original
domicile and she had not acted to replace that domicile with another. She also argued that her marriage and changes of
residency alongside her husband when he changed residency did not result in a change in her place of domicile. In
support of that argument she claimed that section 69 of the Family Code 1988, which gives a husband and wife the right
to jointly fix the family domicile, illustrates the intent of the Philippines Parliament to recognize the rights of women. She
claimed therefore that since she had domicile in Leyte she automatically fulfilled the requirements for a one-year
residency for election purposes.

The respondents argued the meaning of residency in Article 110 of the Civil Code 1950 was the meaning that should be
applied to the constitutional requirement for a one-year residency prior to qualifying for candidacy for the elections. Imelda
Romualdez-Marcos, they argued, had changed her residency to that of her husband upon her marriage and at the same
time automatically gained her husbands domicile. After returning to Leyte she had resided there for only seven months
and she therefore did not satisfy the one year requirement for candidacy.

HELD:

The majority of the Supreme Court (eight judges in favor, four against) held that Imelda Romualdez-Marcos was a
resident of the First District of Leyte for election purposes, and therefore possessed the necessary residence
qualifications to run in Leyte as a candidate for a seat in the House of Representatives. The Court held that the term
residence in the context of qualifying for certain elected positions is synonymous with the term domicile. Domicile
denotes a fixed permanent residence to which one intends to return after an absence. A person can only have a single
domicile, although they can abandon one domicile in favor of another. To successfully change domicile, one must
demonstrate three (3) requirements:
1. an actual removal or an actual change of domicile;
2. a bona fide intention of abandoning the former place of residence and establishing a new one;
3. and one must act in accordance with that intent.

Only with clear and positive evidence that all three requirements have been met will the residence of origin be lost,
otherwise residency will be deemed to continue.

The Court held that the meaning of residence in Article 110 of the Civil Code, which states that the husband shall fix the
residence of the family, is different therefore to the meaning of residence in the Constitution. The term residence may
have one meaning in civil law (as under the Civil Code) and another different meaning in political law as represented in
the election requirements identified in the Constitution. Residency is satisfied under the Civil Code if a person establishes
that they intend to leave a place when the purpose for which they have taken up their abode ends. The purpose of
residency might be for pleasure, business, or health and a person may have different residences in various places.
However, residency in the Constitution as opposed to the Civil Code means domicile and therefore the key issue is to
determine the domicile of the petitioner, Imelda Romualdez-Marcos. The Court held that Article 110 does not create a
presumption that a wife automatically gains a husbands domicile upon marriage. When the petitioner was married to then
Congressman Marcos in 1954, she was obliged by virtue of Article 110 of the Civil Code to follow her husbands actual
place of residence as fixed by him. The right of the husband to fix the residence was in harmony with the intention of the
law to strengthen and unify the family. It recognised the fact that the husband and wife bring into the marriage different
domiciles and if the husband has to stay in or transfer to any one of their residences, the wife should necessarily be with
him in order that they may live together. However, the term residence in Article 110 of the Civil Code does not mean
domicile and therefore it cannot be correctly argued that petitioner lost her domicile as a result of her marriage to the late
President Ferdinand E. Marcos in 1952. The Court also held that it would be illogical for the Court to assume that a wife
cannot regain her original domicile upon the death of her husband, if she has not positively selected a new one during the
subsistence of the marriage itself.

The Court held that the new Family Code, which was introduced to replace the Civil Code, confirmed the petitioners
argument that marriage does not automatically change a wifes domicile to that of her husband. The Family Code
replaced the term residence (used in the Civil Code) with the term domicile. Article 69 of the Family Code gives a
husband and wife the right to jointly fix the family domicile. The provision recognised revolutionary changes in the concept
of womens rights in the intervening years by making the choice of domicile a product of mutual agreement between the
spouses. The provision recognised the right of women to choose their own domicile and removed the automatic transfer
of a husbands domicile to his wife.

Macalintal vs COMELEC
[G.R. No. 157013. July 10, 2003]
Facts:
A petition for certiorari and prohibition filed by Romulo Macalintal, a memer of the Philippine Bar, seeking a declaration
that certain provisions of RA 9189 (The Overseas Absentee Voting Act of 2003) suffer from constitutional infirmity. He
claimed that he has actual and material legal interest in the subject matter of this case in seeing to it that public funds are
properly and lawfully used and appropriated, petitioner filed this petition as a taxpayer and as lawyer.
R.A. No. 9189, entitled, An Act Providing for A System of Overseas Absentee Voting by Qualified Citizens of the
Philippines Abroad, Appropriating Funds Therefor, and for Other Purposes, appropriates funds under Section 29 thereof
which provides that a supplemental budget on the General Appropriations Act of the year of its enactment into law shall
provide for the necessary amount to carry out its provisions.
Petitioner raises three principal questions for contention:
That Section 5(d) of R.A. No. 9189 allowing the registration of voters, who are immigrants or permanent residents in
other countries, by their mere act of executing an affidavit expressing their intention to return to the Philippines, violates
the residency requirement in Art. V, Sec. 1 of the Constitution;
That Section 18.5 of the same law empowering the COMELEC to proclaim the winning candidates for national
offices and party list representatives, including the President and the Vice-President, violates the constitutional mandate
under Art. VII, Sec. 4 of the Constitution that the winning candidates for President and Vice-President shall be proclaimed
as winners only by Congress; and
That Section 25 of the same law, allowing Congress (through the Joint Congressional Oversight Committee created
in the same section) to exercise the power to review, revise, amend, and approve the Implementing Rules and
Regulations (IRR) that the COMELEC shall promulgate, violates the independence of the COMELEC under Art. IX-A,
Sec. 1 of the Constitution.

Issue:
1. Whether or not Section 5(d) of R.A. No. 9189 violates Art. V, Sec. 1 of the Constitution.
2. Whether or not Section 18.5 of R.A. No. 9189 violates Art. VII, Sec. 4 of the Constitution.
3. Whether or not Section 25 of R.A. No. 9189 violates Art. IX-A, Sec. 1 of the Constitution
Ruling:
1. No, Sec 5(d) is valid. The Court has relied on the discussions of the members of the Constitutional Commission on
the topics of absentee voting and absentee voter qualification, in connection with Sec. 2, Art. V of the Constitution, which
reads:
Sec. 2. The Congress shall provide a system for securing the secrecy and sanctity of the ballot as well as a system for
absentee voting by qualified Filipinos abroad.

It was clearly shown from the said discussions that the Constitutional Commission intended to enfranchise as much as
possible all Filipino citizens abroad who have not abandoned their domicile of origin, which is in the Philippines. The
Commission even intended to extend to young Filipinos who reach voting age abroad whose parents domicile of origin is
in the Philippines, and consider them qualified as voters for the first time. That Section 2 of Article V of the Constitution is
an exception to the residency requirement found in Section 1 of the same Article was in fact the subject of debate when
Senate Bill No. 2104, which later became R.A. No. 9189, was deliberated upon on the Senate floor, further weakening
petitioners claim on the unconstitutionality of Section 5(d) of R.A. No. 9189.

2. Yes, Section 18.5 is unconstitutional. Section 18.5 of R.A. No. 9189 is far too sweeping that it necessarily includes
the proclamation of the winning candidates for the presidency and the vice-presidency, granting merit to petitioners
contention that said Section appears to be repugnant to Section 4, Article VII of the Constitution only insofar as said
Section totally disregarded the authority given to Congress by the Constitution to proclaim the winning candidates for the
positions of President and Vice-President.
Congress could not have allowed the COMELEC to usurp a power that constitutionally belongs to it or, as aptly stated by
petitioner, to encroach on the power of Congress to canvass the votes for President and Vice-President and the power to
proclaim the winners for the said positions.

3. Yes, Section 25 creating the JCOC is unconstitutional. The Commission on Elections is a constitutional body. It is
intended to play a distinct and important part in our scheme of government. In the discharge of its functions, it should not
be hampered with restrictions that would be fully warranted in the case of a less responsible organization.

The Commission on Elections, because of its fact-finding facilities, its contacts with political strategists, and its knowledge
derived from actual experience in dealing with political controversies, is in a peculiarly advantageous position to decide
complex political questions.

The Court has no general powers of supervision over COMELEC which is an independent body except those specifically
granted by the Constitution, that is, to review its decisions, orders and rulings. In the same vein, it is not correct to hold
that because of its recognized extensive legislative power to enact election laws, Congress may intrude into the
independence of the COMELEC by exercising supervisory powers over its rule-making authority. In line with this, this
Court holds that Section 25 of R.A. 9189 is unconstitutional and must therefore be stricken off from the said law.

Romulo Macalintal, as a lawyer and a taxpayer, questions the validity of the Overseas Absentee Voting Act of 2003 (R.A.
9189). He questions the validity of the said act on the following grounds, among others:
4. That the provision that a Filipino already considered an immigrant abroad can be allowed to participate in absentee
voting provided he executes an affidavit stating his intent to return to the Philippines is void because it
dispenses of the requirement that a voter must be a resident of the Philippines for at least one year and in the
place where he intends to vote for at least 6 months immediately preceding the election;
5. That the provision allowing the Commission on Elections (COMELEC) to proclaim winning candidates insofar as it
affects the canvass of votes and proclamation of winning candidates for president and vice-president, is
unconstitutional because it violates the Constitution for it is Congress which is empowered to do so.
ISSUE: Whether or not Macalintals arguments are correct.
HELD: No.
1. There can be no absentee voting if the absentee voters are required to physically reside in the Philippines within the
period required for non-absentee voters. Further, as understood in election laws, domicile and resident are
interchangeably used. Hence, one is a resident of his domicile (insofar as election laws is concerned). The
domicile is the place where one has the intention to return to. Thus, an immigrant who executes an affidavit
stating his intent to return to the Philippines is considered a resident of the Philippines for purposes of being
qualified as a voter (absentee voter to be exact). If the immigrant does not execute the affidavit then he is not
qualified as an absentee voter.
2. The said provision should be harmonized. It could not be the intention of Congress to allow COMELEC to include the
proclamation of the winners in the vice-presidential and presidential race. To interpret it that way would mean
that Congress allowed COMELEC to usurp its power. The canvassing and proclamation of the presidential and
vice presidential elections is still lodged in Congress and was in no way transferred to the COMELEC by virtue
of RA 9189.


CORPORATE NATIONALITY: UNDER WHOSE LAWS INCORPORATED (Sec. 123)
EXCEPTION: TEST OF CONTROLLING OWNERSHIP
The 1987 Constitution provides for the Filipinization of public utilities by requiring that any from of
authorization for the operation of public utilities should be granted only to citizens of the Philippines or to
corporation or associations organized under the laws of the Philippines at least sixty per centum of whose capital
is owned by such citizens. The evident purpose of the citizenship requirement is to prevent aliens from assuming
control of public utilities, which may be inimical to the national interest. This specific provision explicitly reserves to
Filipino citizens control of public utilites, pursuant to an overriding economic goal of the 1987 Constitution: to
conserve and develop our patrimony and to ensure a a self-reliant and independent national economy
effectively controlled by Filipinos. We rule that the term capital in Sec. 11, Art. XII of the Constitution refers
only to shares of stock entitled to vote in the election of directors, and thus in the present case only to common
shares, and not the total outstanding capital stock comprising both common and non-voting preferred shares.
Gamboa v. Teves, G.R. No. 176579, 28 June 2011.

THE FACTS

This is a petition to nullify the sale of shares of stock of Philippine Telecommunications Investment Corporation (PTIC) by
the government of the Republic of the Philippines, acting through the Inter-Agency Privatization Council (IPC), to Metro
Pacific Assets Holdings, Inc. (MPAH), an affiliate of First Pacific Company Limited (First Pacific), a Hong Kong-based
investment management and holding company and a shareholder of the Philippine Long Distance Telephone Company
(PLDT).


The petitioner questioned the sale on the ground that it also involved an indirect sale of 12 million shares (or
about 6.3 percent of the outstanding common shares) of PLDT owned by PTIC to First Pacific. With the this sale,
First Pacifics common shareholdings in PLDT increased from 30.7 percent to 37 percent, thereby increasing the
total common shareholdings of foreigners in PLDT to about 81.47%. This, according to the petitioner, violates
Section 11, Article XII of the 1987 Philippine Constitution which limits foreign ownership of the capital of a public
utility to not more than 40%.

II. THE ISSUE

Does the term capital in Section 11, Article XII of the Constitution refer to the total common shares only, or to the total
outstanding capital stock (combined total of common and non-voting preferred shares) of PLDT, a public utility?

III. THE RULING

[The Court partly granted the petition and held that the term capital in Section 11, Article XII of the Constitution refers
only to shares of stock entitled to vote in the election of directors of a public utility, or in the instant case, to the total
common shares of PLDT.]

Section 11, Article XII (National Economy and Patrimony) of the 1987 Constitution mandates the Filipinization of public
utilities, to wit:

Section 11. No franchise, certificate, or any other form of authorization for the operation of a public utility shall be
granted except to citizens of the Philippines or to corporations or associations organized under the laws of the
Philippines, at least sixty per centum of whose capital is owned by such citizens; nor shall such franchise,
certificate, or authorization be exclusive in character or for a longer period than fifty years. Neither shall any such
franchise or right be granted except under the condition that it shall be subject to amendment, alteration, or repeal by the
Congress when the common good so requires. The State shall encourage equity participation in public utilities by the
general public. The participation of foreign investors in the governing body of any public utility enterprise shall be limited to
their proportionate share in its capital, and all the executive and managing officers of such corporation or association must
be citizens of the Philippines. (Emphasis supplied)

The term capital in Section 11, Article XII of the Constitution refers only to shares of stock entitled to vote in the election
of directors, and thus in the present case only to common shares, and not to the total outstanding capital stock comprising
both common and non-voting preferred shares [of PLDT].

xxx xxx xxx

Indisputably, one of the rights of a stockholder is the right to participate in the control or management of the
corporation. This is exercised through his vote in the election of directors because it is the board of directors that controls
or manages the corporation. In the absence of provisions in the articles of incorporation denying voting rights to preferred
shares, preferred shares have the same voting rights as common shares. However, preferred shareholders are often
excluded from any control, that is, deprived of the right to vote in the election of directors and on other matters, on the
theory that the preferred shareholders are merely investors in the corporation for income in the same manner as
bondholders. xxx.

Considering that common shares have voting rights which translate to control, as opposed to preferred shares which
usually have no voting rights, the term capital in Section 11, Article XII of the Constitution refers only to common shares.
However, if the preferred shares also have the right to vote in the election of directors, then the term capital shall include
such preferred shares because the right to participate in the control or management of the corporation is exercised
through the right to vote in the election of directors. In short, the term capital in Section 11, Article XII of the Constitution
refers only to shares of stock that can vote in the election of directors.

xxx xxx xxx

Mere legal title is insufficient to meet the 60 percent Filipino-owned capital required in the Constitution. Full beneficial
ownership of 60 percent of the outstanding capital stock, coupled with 60 percent of the voting rights, is required. The
legal and beneficial ownership of 60 percent of the outstanding capital stock must rest in the hands of Filipino nationals in
accordance with the constitutional mandate. Otherwise, the corporation is considered as non-Philippine national[s].

xxx xxx xxx

To construe broadly the term capital as the total outstanding capital stock, including both common and non-
voting preferred shares, grossly contravenes the intent and letter of the Constitution that the State shall develop a self-
reliant and independent national economy effectively controlled by Filipinos. A broad definition unjustifiably disregards
who owns the all-important voting stock, which necessarily equates to control of the public utility.

We shall illustrate the glaring anomaly in giving a broad definition to the term capital. Let us assume that a corporation
has 100 common shares owned by foreigners and 1,000,000 non-voting preferred shares owned by Filipinos, with both
classes of share having a par value of one peso (P1.00) per share. Under the broad definition of the term capital, such
corporation would be considered compliant with the 40 percent constitutional limit on foreign equity of public utilities since
the overwhelming majority, or more than 99.999 percent, of the total outstanding capital stock is Filipino owned. This is
obviously absurd.

In the example given, only the foreigners holding the common shares have voting rights in the election of directors, even if
they hold only 100 shares. The foreigners, with a minuscule equity of less than 0.001 percent, exercise control over the
public utility. On the other hand, the Filipinos, holding more than 99.999 percent of the equity, cannot vote in the election
of directors and hence, have no control over the public utility. This starkly circumvents the intent of the framers of the
Constitution, as well as the clear language of the Constitution, to place the control of public utilities in the hands of
Filipinos. It also renders illusory the State policy of an independent national economy effectively controlled by Filipinos.

The example given is not theoretical but can be found in the real world, and in fact exists in the present case.

xxx xxx xxx

[O]nly holders of common shares can vote in the election of directors [of PLDT], meaning only common shareholders
exercise control over PLDT. Conversely, holders of preferred shares, who have no voting rights in the election of
directors, do not have any control over PLDT. In fact, under PLDTs Articles of Incorporation, holders of common shares
have voting rights for all purposes, while holders of preferred shares have no voting right for any purpose whatsoever.


It must be stressed, and respondents do not dispute, that foreigners hold a majority of the common shares of PLDT. In
fact, based on PLDTs 2010 General Information Sheet (GIS), which is a document required to be submitted annually to
the Securities and Exchange Commission, foreigners hold 120,046,690 common shares of PLDT whereas Filipinos hold
only 66,750,622 common shares. In other words, foreigners hold 64.27% of the total number of PLDTs common shares,
while Filipinos hold only 35.73%. Since holding a majority of the common shares equates to control, it is clear that
foreigners exercise control over PLDT. Such amount of control unmistakably exceeds the allowable 40 percent limit on
foreign ownership of public utilities expressly mandated in Section 11, Article XII of the Constitution.

As shown in PLDTs 2010 GIS, as submitted to the SEC, the par value of PLDT common shares is P5.00 per share,
whereas the par value of preferred shares is P10.00 per share. In other words, preferred shares have twice the par value
of common shares but cannot elect directors and have only 1/70 of the dividends of common shares. Moreover, 99.44%
of the preferred shares are owned by Filipinos while foreigners own only a minuscule 0.56% of the preferred
shares. Worse, preferred shares constitute 77.85% of the authorized capital stock of PLDT while common shares
constitute only 22.15%. This undeniably shows that beneficial interest in PLDT is not with the non-voting preferred shares
but with the common shares, blatantly violating the constitutional requirement of 60 percent Filipino control and Filipino
beneficial ownership in a public utility.

The legal and beneficial ownership of 60 percent of the outstanding capital stock must rest in the hands of Filipinos in
accordance with the constitutional mandate. Full beneficial ownership of 60 percent of the outstanding capital stock,
coupled with 60 percent of the voting rights, is constitutionally required for the States grant of authority to operate a public
utility. The undisputed fact that the PLDT preferred shares, 99.44% owned by Filipinos, are non-voting and earn only 1/70
of the dividends that PLDT common shares earn, grossly violates the constitutional requirement of 60 percent Filipino
control and Filipino beneficial ownership of a public utility.

In short, Filipinos hold less than 60 percent of the voting stock, and earn less than 60 percent of the dividends, of
PLDT. This directly contravenes the express command in Section 11, Article XII of the Constitution that [n]o franchise,
certificate, or any other form of authorization for the operation of a public utility shall be granted except to x x x
corporations x x x organized under the laws of the Philippines, at least sixty per centum of whose capital is owned by such
citizens x x x.

To repeat, (1) foreigners own 64.27% of the common shares of PLDT, which class of shares exercises the sole right to
vote in the election of directors, and thus exercise control over PLDT; (2) Filipinos own only 35.73% of PLDTs common
shares, constituting a minority of the voting stock, and thus do not exercise control over PLDT; (3) preferred shares,
99.44% owned by Filipinos, have no voting rights; (4) preferred shares earn only 1/70 of the dividends that common
shares earn; (5) preferred shares have twice the par value of common shares; and (6) preferred shares constitute 77.85%
of the authorized capital stock of PLDT and common shares only 22.15%. This kind of ownership and control of a public
utility is a mockery of the Constitution.

Incidentally, the fact that PLDT common shares with a par value of P5.00 have a current stock market value of P2,328.00
per share, while PLDT preferred shares with a par value of P10.00 per share have a current stock market value ranging
from only P10.92 to P11.06 per share, is a glaring confirmation by the market that control and beneficial ownership of
PLDT rest with the common shares, not with the preferred shares.

xxx xxx xxx

WHEREFORE, we PARTLY GRANT the petition and rule that the term capital in Section 11, Article XII of
the 1987 Constitution refers only to shares of stock entitled to vote in the election of directors, and thus in the
present case only to common shares, and not to the total outstanding capital stock (common and non-voting
preferred shares). Respondent Chairperson of the Securities and Exchange Commission is DIRECTED to apply
this definition of the term capital in determining the extent of allowable foreign ownership in respondent
Philippine Long Distance Telephone Company, and if there is a violation of Section 11, Article XII of the
Constitution, to impose the appropriate sanctions under the law.