WILSON P. GAMBOA vs. FINANCE SECRETARY MARGARITO B.

TEVES
G.R. No. 176579 June 28, 2011

Facts:

The issue started when the petitioner questioned the indirect sale of shares involving
almost 12 million shares of the Philippine Long Distance Telephone Company (PLDT) owned by
PTIC to First Pacific. Thus, 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%. The petitioner contends that it violates the Constitutional provision on the limitation
to 40% ownership of non-Filipino citizens of public utility corporations, stated in Section 11, Article
XII of the 1987 Philippine Constitution. Then, in 2011, the court ruled the case in favor of the
petitioner, hence this new case, resolving the motion for reconsideration for the 2011 decision filed
by the respondents.

Issue: Whether or not the Court made an erroneous interpretation of the term capital in its 2011
decision?

Held:

The Court held that the Constitution is clear in expressing its State policy of developing an
economy effectively controlled by Filipinos. Asserting the ideals that our Constitutions Preamble
want to achieve, that is to conserve and develop our patrimony, hence, the State should fortify a
Filipino-controlled economy. In the 2011 decision, the Court finds no wrong in the construction of
the term capital which refers to the shares with voting rights, as well as with full beneficial
ownership, pursuant to Art. 12, sec. 10 of the Constitution, which implies that the right to vote in
the election of directors, coupled with benefits, is tantamount to an effective control. Therefore, the
Courts interpretation of the term capital was not erroneous. Thus, the motion for reconsideration
is denied.