DoP Full Text

EN BANC
BAI SANDRA S. A. SEMA, G.R. No. 177597

Petitioner,
- versus -
COMMISSION ON ELECTIONS
and DIDAGEN P. DILANGALEN,
Respondents.
x------------------------x
PERFECTO F. MARQUEZ, G.R. No. 178628
Petitioner,
Present:
PUNO, C.J.,
QUISUMBING,
YNARES-SANTIAGO,
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
CARPIO MORALES,
- versus - AZCUNA,
TINGA,
CHICO-NAZARIO,
VELASCO, JR.,
NACHURA,
REYES,
LEONARDO-DE CASTRO, and
BRION, JJ.
COMMISSION ON ELECTIONS, Promulgated:

Respondent. July 16, 2008
x--------------------------------------------------x
DECISION
CARPIO, J.:
The Case
These consolidated petitions[1] seek to annul Resolution No. 7902, dated 10 May 2007, of the Commission
on Elections (COMELEC) treating Cotabato City as part of the legislative district of the Province of Shariff
Kabunsuan.[2]
The Facts
The Ordinance appended to the 1987 Constitution apportioned two legislative districts for
the Province of Maguindanao. The first legislative district consists of Cotabato City and eight
municipalities.[3] Maguindanao forms part of the Autonomous Region in Muslim Mindanao (ARMM),
created under its Organic Act, Republic Act No. 6734 (RA 6734), as amended by Republic Act No.
9054 (RA 9054).[4] Although under the Ordinance, Cotabato City forms part of Maguindanaos first
legislative district, it is not part of the ARMM but of Region XII, having voted against its inclusion in the
ARMM in the plebiscite held in November 1989.
On 28 August 2006, the ARMMs legislature, the ARMM Regional Assembly, exercising its power to create
provinces under Section 19, Article VI of RA 9054,[5] enacted Muslim Mindanao Autonomy Act No. 201
(MMA Act 201) creating the Province of Shariff Kabunsuan composed of the eight municipalities in the
first district of Maguindanao.MMA Act 201 provides:
Section 1. The Municipalities of Barira, Buldon, Datu Odin Sinsuat, Kabuntalan, Matanog,
Parang, Sultan Kudarat, Sultan Mastura, and Upi are hereby separated from
the Province of Maguindanao and constituted into a distinct and independent province,
which is hereby created, to be known as the Province of Shariff Kabunsuan.
xxxx
Sec. 5. The corporate existence of this province shall commence upon the
appointment by the Regional Governor or election of the governor and majority of the
regular members of the Sangguniang Panlalawigan.
The incumbent elective provincial officials of the Province of Maguindanao shall continue
to serve their unexpired terms in the province that they will choose or where they are
residents:Provided, that where an elective position in both provinces becomes vacant as a
consequence of the creation of the Province of Shariff Kabunsuan, all incumbent elective
provincial officials shall have preference for appointment to a higher elective vacant
position and for the time being be appointed by the Regional Governor, and shall hold
office until their successors shall have been elected and qualified in the next local elections;
Provided, further, that they shall continue to receive the salaries they are receiving at the
time of the approval of this Act until the new readjustment of salaries in accordance with
law. Provided, furthermore, that there shall be no diminution in the number of the members
of the Sangguniang Panlalawigan of the mother province.
Except as may be provided by national law, the existing legislative district, which includes
Cotabato as a part thereof, shall remain.
Later, three new municipalities[6] were carved out of the original nine municipalities constituting Shariff
Kabunsuan, bringing its total number of municipalities to 11. Thus, what was left of Maguindanao were the
municipalities constituting its second legislative district. Cotabato City, although part of Maguindanaos
first legislative district, is not part of the Province of Maguindanao.
The voters of Maguindanao ratified Shariff Kabunsuans creation in a plebiscite held on 29 October
2006.
On 6 February 2007, the Sangguniang Panlungsod of Cotabato City passed Resolution No. 3999
requesting the COMELEC to clarify the status of Cotabato City in view of the conversion of the First
District of Maguindanao into a regular province under MMA Act 201.
In answer to Cotabato Citys query, the COMELEC issued Resolution No. 07-0407 on 6 March
2007 "maintaining the status quo with Cotabato City as part of Shariff Kabunsuan in the First Legislative
District of Maguindanao. Resolution No. 07-0407, which adopted the recommendation of the COMELECs
Law Department under a Memorandum dated 27 February 2007,[7] provides in pertinent parts:
Considering the foregoing, the Commission RESOLVED, as it hereby resolves, to adopt

the recommendation of the Law Department that pending the enactment of the
appropriate law by Congress, to maintain the status quo with Cotabato City as part of
Shariff Kabunsuan in the First Legislative District of Maguindanao. (Emphasis supplied)
However, in preparation for the 14 May 2007 elections, the COMELEC promulgated on 29 March
2007 Resolution No. 7845 stating that Maguindanaos first legislative district is composed only
of Cotabato City because of the enactment of MMA Act 201.[8]
On 10 May 2007, the COMELEC issued Resolution No. 7902, subject of these petitions, amending
Resolution No. 07-0407 by renaming the legislative district in question
as Shariff Kabunsuan Province with Cotabato City (formerly First District of Maguindanao
[9]
with Cotabato City).
In G.R. No. 177597, Sema, who was a candidate in the 14 May 2007 elections for Representative of Shariff
Kabunsuan with Cotabato City, prayed for the nullification of COMELEC Resolution No. 7902 and the
exclusion from canvassing of the votes cast in Cotabato City for that office. Sema contended that Shariff
Kabunsuan is entitled to one representative in Congress under Section 5 (3), Article VI of the
Constitution[10] and Section 3 of the Ordinance appended to the Constitution.[11] Thus, Sema asserted that
the COMELEC acted without or in excess of its jurisdiction in issuing Resolution No. 7902 which
maintained the status quo in Maguindanaos first legislative district despite the COMELECs earlier directive
in Resolution No. 7845 designating Cotabato City as the lone component of Maguindanaos reapportioned
first legislative district.[12] Sema further claimed that in issuing Resolution No. 7902, the COMELEC
usurped Congress power to create or reapportion legislative districts.
In its Comment, the COMELEC, through the Office of the Solicitor General (OSG), chose not to reach the
merits of the case and merely contended that (1) Sema wrongly availed of the writ of certiorari to nullify
COMELEC Resolution No. 7902 because the COMELEC issued the same in the exercise of its
administrative, not quasi-judicial, power and (2) Semas prayer for the writ of prohibition in G.R. No.
177597 became moot with the proclamation of respondent Didagen P. Dilangalen (respondent Dilangalen)
on 1 June 2007 as representative of the legislative district of Shariff Kabunsuan Province with Cotabato
City.
In his Comment, respondent Dilangalen countered that Sema is estopped from questioning COMELEC
Resolution No. 7902 because in her certificate of candidacy filed on 29 March 2007, Sema indicated that
she was seeking election as representative of Shariff Kabunsuan including Cotabato City. Respondent
Dilangalen added that COMELEC Resolution No. 7902 is constitutional because it did not apportion a
legislative district for Shariff Kabunsuan or reapportion the legislative districts in Maguindanao but merely
renamed Maguindanaos first legislative district. Respondent Dilangalen further claimed that the
COMELEC could not reapportion Maguindanaos first legislative district to make Cotabato City its sole
component unit as the power to reapportion legislative districts lies exclusively with Congress, not to
mention that Cotabato City does not meet the minimum population requirement under Section 5 (3), Article
VI of the Constitution for the creation of a legislative district within a city.[13]
Sema filed a Consolidated Reply controverting the matters raised in respondents Comments and reiterating
her claim that the COMELEC acted ultra vires in issuing Resolution No. 7902.
In the Resolution of 4 September 2007, the Court required the parties in G.R. No. 177597 to
comment on the issue of whether a province created by the ARMM Regional Assembly under Section 19,
Article VI of RA 9054 is entitled to one representative in the House of Representatives without need of a
national law creating a legislative district for such new province. The parties submitted their compliance as
follows:
(1) Sema answered the issue in the affirmative on the following grounds: (a) the Court in Felwa v.
[14]
Salas stated that when a province is created by statute, the corresponding representative district comes
into existence neither by authority of that statute which cannot provide otherwise nor by apportionment,
but by operation of the Constitution, without a reapportionment; (b) Section 462 of Republic Act No. 7160
(RA 7160) affirms the apportionment of a legislative district incident to the creation of a province; and
(c) Section 5 (3), Article VI of the Constitution and Section 3 of the Ordinance appended to the Constitution
mandate the apportionment of a legislative district in newly created provinces.
(2) The COMELEC, again represented by the OSG, apparently abandoned its earlier stance on the
propriety of issuing Resolution Nos. 07-0407 and 7902 and joined causes with Sema, contending that
Section 5 (3), Article VI of the Constitution is self-executing. Thus, every new province created by the
ARMM Regional Assembly is ipso facto entitled to one representative in the House of Representatives even
in the absence of a national law; and
(3) Respondent Dilangalen answered the issue in the negative on the following grounds: (a) the
province contemplated in Section 5 (3), Article VI of the Constitution is one that is created by an act of
Congress taking into account the provisions in RA 7160 on the creation of provinces; (b) Section 3, Article
IV of RA 9054 withheld from the ARMM Regional Assembly the power to enact measures relating to
national elections, which encompasses the apportionment of legislative districts for members of the House
of Representatives; (c) recognizing a legislative district in every province the ARMM Regional Assembly
creates will lead to the disproportionate representation of the ARMM in the House of Representatives as
the Regional Assembly can create provinces without regard to the requirements in Section 461 of RA 7160;
and (d) Cotabato City, which has a population of less than 250,000, is not entitled to a representative in the
House of Representatives.
On 27 November 2007, the Court heard the parties in G.R. No. 177597 in oral arguments on the
following issues: (1) whether Section 19, Article VI of RA 9054, delegating to the ARMM Regional
Assembly the power to create provinces, is constitutional; and (2) if in the affirmative, whether a province
created under Section 19, Article VI of RA 9054 is entitled to one representative in the House of
Representatives without need of a national law creating a legislative district for such new province.[15]
In compliance with the Resolution dated 27 November 2007, the parties in G.R. No. 177597 filed
their respective Memoranda on the issues raised in the oral arguments.[16] On the question of the
constitutionality of Section 19, Article VI of RA 9054, the parties in G.R. No. 177597 adopted the following
positions:
(1) Sema contended that Section 19, Article VI of RA 9054 is constitutional (a) as a valid delegation
by Congress to the ARMM of the power to create provinces under Section 20 (9), Article X of the
Constitution granting to the autonomous regions, through their organic acts, legislative powers over other
matters as may be authorized by law for the promotion of the general welfare of the people of the region
and (b) as an amendment to Section 6 of RA 7160.[17] However, Sema concedes that, if taken literally, the
grant in Section 19, Article VI of RA 9054 to the ARMM Regional Assembly of the power to prescribe
standards lower than those mandated in RA 7160 in the creation of provinces contravenes Section 10,
Article X of the Constitution.[18] Thus, Sema proposed that Section 19 should be construed as prohibiting
the Regional Assembly from prescribing standards x x x that do not comply with the minimum criteria
under RA 7160.[19]
(2) Respondent Dilangalen contended that Section 19, Article VI of RA 9054 is unconstitutional
on the following grounds: (a) the power to create provinces was not among those granted to the autonomous
regions under Section 20, Article X of the Constitution and (b) the grant under Section 19, Article VI of
RA 9054 to the ARMM Regional Assembly of the power to prescribe standards lower than those mandated
in Section 461 of RA 7160 on the creation of provinces contravenes Section 10, Article X of the
Constitution and the Equal Protection Clause; and
(3) The COMELEC, through the OSG, joined causes with respondent Dilangalen (thus effectively
abandoning the position the COMELEC adopted in its Compliance with the Resolution of 4 September
2007) and contended that Section 19, Article VI of RA 9054 is unconstitutional because (a) it contravenes
Section 10 and Section 6,[20] Article X of the Constitution and (b) the power to create provinces was
withheld from the autonomous regions under Section 20, Article X of the Constitution.
On the question of whether a province created under Section 19, Article VI of RA 9054 is entitled
to one representative in the House of Representatives without need of a national law creating a legislative
district for such new province, Sema and respondent Dilangalen reiterated in their Memoranda the positions
they adopted in their Compliance with the Resolution of 4 September 2007. The COMELEC deemed it
unnecessary to submit its position on this issue considering its stance that Section 19, Article VI of RA
9054 is unconstitutional.
The pendency of the petition in G.R. No. 178628 was disclosed during the oral arguments on 27
November 2007. Thus, in the Resolution of 19 February 2008, the Court ordered G.R. No. 178628
consolidated with G.R. No. 177597. The petition in G.R. No. 178628 echoed Sema's contention that the
COMELEC acted ultra vires in issuing Resolution No. 7902 depriving the voters of Cotabato City of a
representative in the House of Representatives. In its Comment to the petition in G.R. No. 178628, the
COMELEC, through the OSG, maintained the validity of COMELEC Resolution No. 7902 as a temporary
measure pending the enactment by Congress of the appropriate law.
The Issues
The petitions raise the following issues:
I. In G.R. No. 177597:

(A) Preliminarily
(1) whether the writs of Certiorari, Prohibition, and Mandamus are proper to test the
constitutionality of COMELEC Resolution No. 7902; and
(2) whether the proclamation of respondent Dilangalen as representative
of Shariff Kabunsuan Province with Cotabato City mooted the petition in G.R. No. 177597.
(B) On the merits
(1) whether Section 19, Article VI of RA 9054, delegating to the ARMM Regional Assembly the
power to create provinces, cities, municipalities and barangays, is constitutional; and
(2) if in the affirmative, whether a province created by the ARMM Regional Assembly under MMA
Act 201 pursuant to Section 19, Article VI of RA 9054 is entitled to one representative in the House of
Representatives without need of a national law creating a legislative district for such province.
II. In G.R No. 177597 and G.R No. 178628, whether COMELEC Resolution No. 7902 is valid for
maintaining the status quo in the first legislative district of Maguindanao (as Shariff Kabunsuan Province
with Cotabato City [formerly First District of Maguindanao with Cotabato City]), despite the creation of
the Province of Shariff Kabunsuan out of such district (excluding Cotabato City).
The Ruling of the Court
The petitions have no merit. We rule that (1) Section 19, Article VI of RA 9054 is unconstitutional insofar
as it grants to the ARMM Regional Assembly the power to create provinces and cities; (2) MMA Act 201
creating the Province of Shariff Kabunsuan is void; and (3) COMELEC Resolution No. 7902 is valid.
On the Preliminary Matters

The Writ of Prohibition is Appropriate
to Test the Constitutionality of
Election Laws, Rules and Regulations
The purpose of the writ of Certiorari is to correct grave abuse of discretion by any tribunal, board,
or officer exercising judicial or quasi-judicial functions.[21] On the other hand, the writ of Mandamus will
issue to compel a tribunal, corporation, board, officer, or person to perform an act which the law specifically
enjoins as a duty.[22] True, the COMELEC did not issue Resolution No. 7902 in the exercise of its judicial
or quasi-judicial functions.[23] Nor is there a law which specifically enjoins the COMELEC to exclude from
canvassing the votes cast in Cotabato City for representative
of Shariff Kabunsuan Province with Cotabato City. These, however, do not justify the outright dismissal of
the petition in G.R. No. 177597 because Sema also prayed for the issuance of the writ of Prohibition and
we have long recognized this writ as proper for testing the constitutionality of election laws, rules, and
regulations.[24]
Respondent Dilangalens Proclamation

Does Not Moot the Petition
There is also no merit in the claim that respondent Dilangalens proclamation as winner in the 14 May
2007 elections for representative of Shariff Kabunsuan Province with Cotabato City mooted this petition.
This case does not concern respondent Dilangalens election. Rather, it involves an inquiry into the validity
of COMELEC Resolution No. 7902, as well as the constitutionality of MMA Act 201 and Section 19,
Article VI of RA 9054. Admittedly, the outcome of this petition, one way or another, determines whether
the votes cast in Cotabato City for representative of the district
of Shariff Kabunsuan Province with Cotabato City will be included in the canvassing of ballots. However,
this incidental consequence is no reason for us not to proceed with the resolution of the novel issues raised
here. The Courts ruling in these petitions affects not only the recently concluded elections but also all the
other succeeding elections for the office in question, as well as the power of the ARMM Regional Assembly
to create in the future additional provinces.
On the Main Issues
Whether the ARMM Regional Assembly

Can Create the Province of Shariff Kabunsuan
The creation of local government units is governed by Section 10, Article X of the Constitution, which
provides:
Sec. 10. No province, city, municipality, or barangay may be created, divided,
merged, abolished or its boundary substantially altered except in accordance with the
criteria established in the local government code and subject to approval by a majority of
the votes cast in a plebiscite in the political units directly affected.
Thus, the creation of any of the four local government units province, city, municipality or barangay must
comply with three conditions. First, the creation of a local government unit must follow the criteria fixed
in the Local Government Code. Second, such creation must not conflict with any provision of the
Constitution. Third, there must be a plebiscite in the political units affected.
There is neither an express prohibition nor an express grant of authority in the Constitution for Congress to
delegate to regional or local legislative bodies the power to create local government units. However, under
its plenary legislative powers, Congress can delegate to local legislative bodies the power to create local
government units, subject to reasonable standards and provided no conflict arises with any provision of the
Constitution. In fact, Congress has delegated to provincial boards, and city and municipal councils, the
power to create barangays within their jurisdiction,[25] subject to compliance with the criteria established in
the Local Government Code, and the plebiscite requirement in Section 10, Article X of the
Constitution. However, under the Local Government Code, only x x x an Act of Congress can create
provinces, cities or municipalities.[26]
Under Section 19, Article VI of RA 9054, Congress delegated to the ARMM Regional Assembly the power
to create provinces, cities, municipalities and barangays within the ARMM. Congress made the delegation
under its plenary legislative powers because the power to create local government units is not one of the
express legislative powers granted by the Constitution to regional legislative bodies.[27] In the present case,
the question arises whether the delegation to the ARMM Regional Assembly of the power to create
provinces, cities, municipalities and barangays conflicts with any provision of the Constitution.
There is no provision in the Constitution that conflicts with the delegation to regional legislative bodies of
the power to create municipalities and barangays, provided Section 10, Article X of the Constitution is
followed. However, the creation of provinces and cities is another matter. Section 5 (3), Article VI of the
Constitution provides, Each city with a population of at least two hundred fifty thousand, or each province,
shall have at least one representative in the House of Representatives. Similarly, Section 3 of the Ordinance
appended to the Constitution provides, Any province that may hereafter be created, or any city whose
population may hereafter increase to more than two hundred fifty thousand shall be entitled in the
immediately following election to at least one Member x x x.
Clearly, a province cannot be created without a legislative district because it will violate Section 5
(3), Article VI of the Constitution as well as Section 3 of the Ordinance appended to the Constitution. For
the same reason, a city with a population of 250,000 or more cannot also be created without a legislative
district. Thus, the power to create a province, or a city with a population of 250,000 or more, requires also
the power to create a legislative district. Even the creation of a city with a population of less than 250,000
involves the power to create a legislative district because once the citys population reaches 250,000, the
city automatically becomes entitled to one representative under Section 5 (3), Article VI of the Constitution
and Section 3 of the Ordinance appended to the Constitution. Thus, the power to create a province or
city inherently involves the power to create a legislative district.
For Congress to delegate validly the power to create a province or city, it must also validly delegate
at the same time the power to create a legislative district. The threshold issue then is, can Congress validly
delegate to the ARMM Regional Assembly the power to create legislative districts for the House of
Representatives? The answer is in the negative.
Legislative Districts are Created or Reapportioned

Only by an Act of Congress
Under the present Constitution, as well as in past[28] Constitutions, the power to increase the
allowable membership in the House of Representatives, and to reapportion legislative districts, is vested
exclusively in Congress. Section 5, Article VI of the Constitution provides:
SECTION 5. (1) The House of Representatives shall be composed of not more

than two hundred and fifty members, unless otherwise fixed by law, who shall be
elected from legislative districts apportioned among the provinces, cities, and the
Metropolitan Manila area in accordance with the number of their respective inhabitants,
and on the basis of a uniform and progressive ratio, and those who, as provided by law,
shall be elected through a party-list system of registered national, regional, and sectoral
parties or organizations.
xxxx
(3) Each legislative district shall comprise, as far as practicable, contiguous,

compact, and adjacent territory. Each city with a population of at least two hundred fifty
thousand, or each province, shall have at least one representative.
(4) Within three years following the return of every census, the Congress shall
make a reapportionment of legislative districts based on the standards provided in this
section. (Emphasis supplied)
Section 5 (1), Article VI of the Constitution vests in Congress the power to increase, through a law,
the allowable membership in the House of Representatives. Section 5 (4) empowers Congress to
reapportion legislative districts. The power to reapportion legislative districts necessarily includes the
power to create legislative districts out of existing ones. Congress exercises these powers through a law that
Congress itself enacts, and not through a law that regional or local legislative bodies enact. The allowable
membership of the House of Representatives can be increased, and new legislative districts of Congress
can be created, only through a national law passed by Congress. In Montejo v. COMELEC,[29] we held that
the power of redistricting x x x is traditionally regarded as part of the power (of Congress) to make laws,
and thus is vested exclusively in Congress.
This textual commitment to Congress of the exclusive power to create or reapportion legislative
districts is logical. Congress is a national legislature and any increase in its allowable membership or in its
incumbent membership through the creation of legislative districts must be embodied in a national law.
Only Congress can enact such a law. It would be anomalous for regional or local legislative bodies to create
or reapportion legislative districts for a national legislature like Congress. An inferior legislative body,
created by a superior legislative body, cannot change the membership of the superior legislative body.
The creation of the ARMM, and the grant of legislative powers to its Regional Assembly under its
organic act, did not divest Congress of its exclusive authority to create legislative districts. This is clear
from the Constitution and the ARMM Organic Act, as amended. Thus, Section 20, Article X of the
Constitution provides:
SECTION 20. Within its territorial jurisdiction and subject to the provisions of this
Constitution and national laws, the organic act of autonomous regions shall provide for
legislative powers over:
(1) Administrative organization;
(2) Creation of sources of revenues;
(3) Ancestral domain and natural resources;
(4) Personal, family, and property relations;
(5) Regional urban and rural planning development;
(6) Economic, social, and tourism development;
(7) Educational policies;
(8) Preservation and development of the cultural heritage; and
(9) Such other matters as may be authorized by law for the promotion of the
general welfare of the people of the region.
Nothing in Section 20, Article X of the Constitution authorizes autonomous regions, expressly or
impliedly, to create or reapportion legislative districts for Congress.
On the other hand, Section 3, Article IV of RA 9054 amending the ARMM Organic Act,
provides, The Regional Assembly may exercise legislative power x x x except on the following
matters: x x x (k) National elections. x x x. Since the ARMM Regional Assembly has no legislative power
to enact laws relating to national elections, it cannot create a legislative district whose representative is
elected in national elections. Whenever Congress enacts a law creating a legislative district, the first
representative is always elected in the next national elections from the effectivity of the law.[30]
Indeed, the office of a legislative district representative to Congress is a national office, and its
occupant, a Member of the House of Representatives, is a national official.[31] It would be incongruous for
a regional legislative body like the ARMM Regional Assembly to create a national office when its
legislative powers extend only to its regional territory. The office of a district representative is maintained
by national funds and the salary of its occupant is paid out of national funds. It is a self-evident inherent
limitation on the legislative powers of every local or regional legislative body that it can only create local
or regional offices, respectively, and it can never create a national office.
To allow the ARMM Regional Assembly to create a national office is to allow its legislative powers
to operate outside the ARMMs territorial jurisdiction. This violates Section 20, Article X of the
Constitution which expressly limits the coverage of the Regional Assemblys legislative
powers [w]ithin its territorial jurisdiction x x x.
The ARMM Regional Assembly itself, in creating Shariff Kabunsuan, recognized the exclusive
nature of Congress power to create or reapportion legislative districts by abstaining from creating a
legislative district for Shariff Kabunsuan. Section 5 of MMA Act 201 provides that:
Except as may be provided by national law, the existing legislative district,

which includes Cotabato City as a part thereof, shall remain. (Emphasis supplied)
However, a province cannot legally be created without a legislative district because the Constitution
mandates that each province shall have at least one representative. Thus, the creation of the Province of
Shariff Kabunsuan without a legislative district is unconstitutional.
Sema, petitioner in G.R. No. 177597, contends that Section 5 (3), Article VI of the Constitution, which
provides:
Each legislative district shall comprise, as far as practicable, contiguous, compact,

and adjacent territory. Each city with a population of at least two hundred fifty
thousand, or each province, shall have at least one representative. (Emphasis supplied)
and Section 3 of the Ordinance appended to the Constitution, which states:

Any province that may hereafter be created, or any city whose population
may hereafter increase to more than two hundred fifty thousand shall be entitled in
the immediately following election to at least one Member or such number of
Members as it may be entitled to on the basis of the number of its inhabitants and
according to the standards set forth in paragraph (3), Section 5 of Article VI of the
Constitution. The number of Members apportioned to the province out of which such new
province was created or where the city, whose population has so increased, is
geographically located shall be correspondingly adjusted by the Commission on Elections
but such adjustment shall not be made within one hundred and twenty days before the
election. (Emphasis supplied)
serve as bases for the conclusion that the Province of Shariff Kabunsuan, created on 29 October 2006, is
automatically entitled to one member in the House of Representatives in the 14 May 2007 elections. As
further support for her stance, petitioner invokes the statement in Felwa that when a province is created by
statute, the corresponding representative district comes into existence neither by authority of that statute
which cannot provide otherwise nor by apportionment, but by operation of the Constitution, without a
reapportionment.
The contention has no merit.
First. The issue in Felwa, among others, was whether Republic Act No. 4695 (RA 4695), creating the
provinces of Benguet, Mountain Province, Ifugao, and Kalinga-Apayao and providing for congressional
representation in the old and new provinces, was unconstitutional for creati[ng] congressional districts
without the apportionment provided in the Constitution. The Court answered in the negative, thus:
The Constitution ordains:
The House of Representatives shall be composed of not more than one

hundred and twenty Members who shall be apportioned among the several
provinces as nearly as may be according to the number of their respective
inhabitants, but each province shall have at least one Member. The
Congress shall by law make an apportionment within three years after the
return of every enumeration, and not otherwise. Until such apportionment
shall have been made, the House of Representatives shall have the same
number of Members as that fixed by law for the National Assembly, who
shall be elected by the qualified electors from the present Assembly
districts. Each representative district shall comprise as far as practicable,
contiguous and compact territory.
Pursuant to this Section, a representative district may come into existence: (a)
indirectly, through the creation of a province for each province shall have at least one
member in the House of Representatives; or (b) by direct creation of several
representative districts within a province. The requirements concerning the
apportionment of representative districts and the territory thereof refer only to the second
method of creation of representative districts, and do not apply to those incidental to the
creation of provinces, under the first method. This is deducible, not only from the general
tenor of the provision above quoted, but, also, from the fact that the apportionment therein
alluded to refers to that which is made by an Act of Congress. Indeed, when a province
is created by statute, the corresponding representative district, comes into existence
neither by authority of that statute which cannot provide otherwise nor by
apportionment, but by operation of the Constitution, without a reapportionment.
There is no constitutional limitation as to the time when, territory of, or other conditions
under which a province may be created, except, perhaps, if the consequence thereof were
to exceed the maximum of 120 representative districts prescribed in the Constitution, which
is not the effect of the legislation under consideration. As a matter of fact, provinces have
been created or subdivided into other provinces, with the consequent creation of additional
representative districts, without complying with the aforementioned
requirements.[32] (Emphasis supplied)
Thus, the Court sustained the constitutionality of RA 4695 because (1) it validly created legislative districts
indirectly through a special law enacted by Congress creating a province and (2) the creation of the
legislative districts will not result in breaching the maximum number of legislative districts provided under
the 1935 Constitution. Felwa does not apply to the present case because in Felwa the new provinces were
created by a national law enacted by Congress itself. Here, the new province was created merely by
a regional law enacted by the ARMM Regional Assembly.
What Felwa teaches is that the creation of a legislative district by Congress does not emanate alone
from Congress power to reapportion legislative districts, but also from Congress power to create provinces
which cannot be created without a legislative district. Thus, when a province is created, a legislative district
is created by operation of the Constitution because the Constitution provides that each province shall
have at least one representative in the House of Representatives. This does not detract from the
constitutional principle that the power to create legislative districts belongs exclusively to Congress. It
merely prevents any other legislative body, except Congress, from creating provinces because for a
legislative body to create a province such legislative body must have the power to create legislative
districts. In short, only an act of Congress can trigger the creation of a legislative district by operation of
the Constitution. Thus, only Congress has the power to create, or trigger the creation of, a legislative district.
Moreover, if as Sema claims MMA Act 201 apportioned a legislative district to Shariff Kabunsuan
upon its creation, this will leave Cotabato City as the lone component of the first legislative district of
Maguindanao. However, Cotabato City cannot constitute a legislative district by itself because as of the
census taken in 2000, it had a population of only 163,849. To constitute Cotabato City alone as the surviving
first legislative district of Maguindanao will violate Section 5 (3), Article VI of the Constitution which
requires that [E]ach city with a population of at least two hundred fifty thousand x x x, shall have at least
one representative.
Second. Semas theory also undermines the composition and independence of the House of
Representatives. Under Section 19,[33] Article VI of RA 9054, the ARMM Regional Assembly can create
provinces and cities within the ARMM with or without regard to the criteria fixed in Section 461 of RA
7160, namely: minimum annual income of P20,000,000, and minimum contiguous territory of 2,000 square
kilometers or minimum population of 250,000.[34] The following scenarios thus become distinct
possibilities:
(1) An inferior legislative body like the ARMM Regional Assembly can create 100
or more provinces and thus increase the membership of a superior legislative body, the
House of Representatives, beyond the maximum limit of 250 fixed in the Constitution
(unless a national law provides otherwise);
(2) The proportional representation in the House of Representatives based on one

representative for at least every 250,000 residents will be negated because the ARMM
Regional Assembly need not comply with the requirement in Section 461(a)(ii) of RA 7160
that every province created must have a population of at least 250,000; and
(3) Representatives from the ARMM provinces can become the majority in the
House of Representatives through the ARMM Regional Assemblys continuous creation of
provinces or cities within the ARMM.
The following exchange during the oral arguments of the petition in G.R. No. 177597 highlights
the absurdity of Semas position that the ARMM Regional Assembly can create provinces:
Justice Carpio:
So, you mean to say [a] Local Government can create legislative district[s] and
pack Congress with their own representatives [?]
Atty. Vistan II:[35]

Yes, Your Honor, because the Constitution allows that.
Justice Carpio:
So, [the] Regional Assembly of [the] ARMM can create and create x x x
provinces x x x and, therefore, they can have thirty-five (35) new representatives
in the House of Representatives without Congress agreeing to it, is that what you
are saying? That can be done, under your theory[?]
Atty. Vistan II:
Yes, Your Honor, under the correct factual circumstances.

Justice Carpio:
Under your theory, the ARMM legislature can create thirty-five (35) new
provinces, there may be x x x [only] one hundred thousand (100,000) [population],
x x x, and they will each have one representative x x x to Congress without any
national law, is that what you are saying?
Atty. Vistan II:
Without law passed by Congress, yes, Your Honor, that is what we are saying.
xxxx
Justice Carpio:
So, they can also create one thousand (1000) new provinces, sen[d] one
thousand (1000) representatives to the House of Representatives without a
national law[,] that is legally possible, correct?
Atty. Vistan II:
Yes, Your Honor.[36] (Emphasis supplied)
Neither the framers of the 1987 Constitution in adopting the provisions in Article X on regional
autonomy,[37] nor Congress in enacting RA 9054, envisioned or intended these disastrous consequences that
certainly would wreck the tri-branch system of government under our Constitution. Clearly, the power to
create or reapportion legislative districts cannot be delegated by Congress but must be exercised by
Congress itself. Even the ARMM Regional Assembly recognizes this.
The Constitution empowered Congress to create or reapportion legislative districts, not the regional
assemblies. Section 3 of the Ordinance to the Constitution which states, [A]ny province that may hereafter
be created x x x shall be entitled in the immediately following election to at least one Member, refers to a
province created by Congress itself through a national law. The reason is that the creation of a province
increases the actual membership of the House of Representatives, an increase that only Congress can
decide.Incidentally, in the present 14th Congress, there are 219[38] district representatives out of the
maximum 250 seats in the House of Representatives. Since party-list members shall constitute 20 percent
of total membership of the House, there should at least be 50 party-list seats available in every election in
case 50 party-list candidates are proclaimed winners. This leaves only 200 seats for district representatives,
much less than the 219 incumbent district representatives. Thus, there is a need now for Congress to
increase by law the allowable membership of the House, even before Congress can create new provinces.
It is axiomatic that organic acts of autonomous regions cannot prevail over the Constitution. Section 20,
Article X of the Constitution expressly provides that the legislative powers of regional assemblies are
limited [w]ithin its territorial jurisdiction and subject to the provisions of the Constitution and
national laws, x x x. The Preamble of the ARMM Organic Act (RA 9054) itself states that the ARMM
Government is established within the framework of the Constitution. This follows Section 15, Article X of
the Constitution which mandates that the ARMM shall be created x x x within the framework of this
Constitution and the national sovereignty as well as territorial integrity of the Republic of the
Philippines.
The present case involves the creation of a local government unit that necessarily involves also the
creation of a legislative district. The Court will not pass upon the constitutionality of the creation of
municipalities and barangays that does not comply with the criteria established in Section 461 of RA 7160,
as mandated in Section 10, Article X of the Constitution, because the creation of such municipalities and
barangays does not involve the creation of legislative districts. We leave the resolution of this issue to an
appropriate case.
In summary, we rule that Section 19, Article VI of RA 9054, insofar as it grants to the ARMM Regional
Assembly the power to create provinces and cities, is void for being contrary to Section 5 of Article VI and
Section 20 of Article X of the Constitution, as well as Section 3 of the Ordinance appended to the
Constitution. Only Congress can create provinces and cities because the creation of provinces and cities
necessarily includes the creation of legislative districts, a power only Congress can exercise under Section
5, Article VI of the Constitution and Section 3 of the Ordinance appended to the Constitution. The ARMM
Regional Assembly cannot create a province without a legislative district because the Constitution mandates
that every province shall have a legislative district. Moreover, the ARMM Regional Assembly cannot enact
a law creating a national office like the office of a district representative of Congress because the legislative
powers of the ARMM Regional Assembly operate only within its territorial jurisdiction as provided in
Section 20, Article X of the Constitution. Thus, we rule that MMA Act 201, enacted by the ARMM
Regional Assembly and creating the Province of Shariff Kabunsuan, is void.
Resolution No. 7902 Complies with the Constitution
Consequently, we hold that COMELEC Resolution No. 7902, preserving the geographic and
legislative district of the First District of Maguindanao with Cotabato City, is valid as it merely complies
with Section 5 of Article VI and Section 20 of Article X of the Constitution, as well as Section 1 of the
Ordinance appended to the Constitution.
WHEREFORE, we declare Section 19, Article VI of Republic Act No.

9054 UNCONSTITUTIONAL insofar as it grants to the Regional Assembly of the Autonomous Region
in Muslim Mindanao the power to create provinces and cities. Thus, we declare VOID Muslim Mindanao
Autonomy Act No. 201 creating the Province of Shariff Kabunsuan.Consequently, we rule that COMELEC
Resolution No. 7902 is VALID.
Let a copy of this ruling be served on the President of the Senate and the Speaker of the House of
Representatives.
SO ORDERED.
ANTONIO T. CARPIO
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
LEONARDO A. QUISUMBING CONSUELO YNARES-SANTIAGO

Associate Justice Associate Justice
MA. ALICIA AUSTRIA-MARTINEZ RENATO C. CORONA

CONCHITA CARPIO MORALES ADOLFO S. AZCUNA
DANTE O. TINGA MINITA V. CHICO-NAZARIO

PRESBITERO J. VELASCO, JR. ANTONIO EDUARDO B. NACHURA

RUBEN T. REYES TERESITA J. LEONARDO-DE CASTRO

ARTURO D. BRION
Associate Justice
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above Decision
had been reached in consultation before the case was assigned to the writer of the opinion of the Court.
REYNATO S. PUNO
Chief Justice
[1]
In G.R. No. 177597, for the writs of certiorari, prohibition and mandamus; in G.R. No. 178628,
for declaratory relief and for the writs of prohibition and mandamus.
[2]
The petitioner in G.R. No. 177597, Bai Sandra S. A. Sema (Sema), further seeks to compel
the COMELEC to exclude from the canvassing the votes cast in Cotabato City for representative of the
legislative district in question in the 14 May 2007 elections. On the other hand, the petitioner in G.R. No.
178628, Perfecto Marquez, prays that the Court order the COMELEC to conduct a special election for
representative of the First District of Maguindanao with Cotabato City.
[3]
Barira, Buldon, Datu Odin Sinsuat, Kabuntalan, Matanog, Parang, Sultan Kudarat, and Upi. The second
legislative district is composed of 19 municipalities (Talitay, Talayan, Guindulungan, Datu Saudi
Ampatuan, Datu Piang, Shariff Aguak, Datu Unsay, Mamasapano, South Upi, Ampatuan, Datu
Abdullah Sangki, Buluan, Datu Paglas, Gen, S.K. Pendatun, Sultan Sa Barongis, Rajah Buayan,
Pagalungan, Pagagawan and Paglat).
[4]
The enactment of the organic acts for the autonomous regions of the Cordilleras and Muslim Mindanao
is mandated under Sections 18 and 19, Article X of the 1987 Constitution.
[5]
The provision reads:
SECTION 19. Creation, Division or Abolition of Provinces, Cities,

Municipalities or Barangay. The Regional Assembly may create, divide,
merge, abolish, or substantially alter boundaries of provinces, cities,
municipalities, or barangay in accordance with the criteria laid down by
Republic Act No. 7160, the Local Government Code of 1991, subject to the
approval by a majority of the votes cast in a plebiscite in the political units
directly affected. The Regional Assembly may prescribe standards lower
than those mandated by Republic Act No. 7160, the Local Government
Code of 1991, in the creation, division, merger, abolition, or alteration of the
boundaries of provinces, cities, municipalities, or barangay. Provinces, cities,
municipalities, or barangay created, divided, merged, or whose boundaries
are altered without observing the standards prescribed by Republic Act No.
7160, the Local Government Code of 1991, shall not be entitled to any share
of the taxes that are allotted to the local governments units under the
provisions of the Code.
The financial requirements of the provinces, cities, municipalities, or
barangay so created, divided, or merged shall be provided by the Regional
Assembly out of the general funds of the Regional Government.
The holding of a plebiscite to determine the will of the majority of
the voters of the areas affected by the creation, division, merger, or whose
boundaries are being altered as required by Republic Act No. 7160, the Local
Government Code of 1991, shall, however, be observed.
The Regional Assembly may also change the names of local
government units, public places and institutions, and declare regional
holidays. (Emphasis supplied)
Before the enactment of RA 9054, the power to create provinces, cities, municipalities, and
barangays was vested in Congress (for provinces, cities and municipalities) and in the sangguniang
panlalawigan and sangguniang panlungsod (for barangays). (See Sections 384, 448, and 460 of
Republic Act No. 7160 or the Local Government Code of 1991.)
[6]
Sultan Mastura (created from Sultan Kudarat), Northern Kabuntulan (created from Kabuntulan) and Datu
Blah Sinsuat (created from Upi).
[7]
The Memorandum reads in pertinent parts:
The record shows the former province of Maguindanao was divided into two new provinces
(Shariff Kabunsuan and Maguindanao), in view of Muslim Mindanao Autonomy Act
(MMAA) No. 201, which authority was conferred to under Section 17, Article VI of
Republic Act No. 9054 giving the ARMM, thru its Regional Legislative Assembly, the
power to legislate laws including the enactment of the Local Government Code of ARMM.
The newly created province of Shariff Kabunsuan comprises the municipalities of Barira,
Buldon, Datu Odin Sinsuat, Kabuntalan, Matanog, Parang, Sultan Kudarat, Sultan
Mastura, Upi and Datu Blah, including Cotabato City [which] belongs to the first district
of Maguindanao province.
It must be emphasized that Cotabato City is not included as part of ARMM although
geographically located within the first district of the former Maguindanao
province. Cotabato City is not voting for provincial officials. This is the reason why
Cotabato City was not specifically mentioned as part of the newly created province of
Shariff Kabunsuan.
Geographically speaking since [sic] Cotabato City is located within the newly created
province of Shariff Kabunsuan having been bounded by municipalities of Sultan Kudarat,
Datu Odin Sinsuat and Kabuntalan as its nearest neighbors. Following the rule in
establishing legislative district, it shall comprise, as far as practicable, contiguous, compact
and adjacent territory.
However, legally speaking, it may arise question of legality [sic] if Cotabato City will be
appended as part of the newly created Shariff Kabunsuan province. Under our Constitution
[it is] only Congress that shall make a reapportionment of legislative districts based on the
standards provided for under Section 5(1) of Article VI.
xxxx
In order to avoid controversy on the matter, pending the enactment of appropriate law by
Congress, it would be prudent and logically feasible to maintain status quo with Cotabato
City as part of Shariff Kabunsuan in the first district of Maguindanao.
[8]
Resolution No. 7845 pertinently provides:
WHEREAS, the Province of Maguindanao consists of two legislative districts,

with Cotabato City as part of the first legislative district.
WHEREAS, Muslim Mindanao Autonomy Act No. 201 provided for the creation
of the new Province of Shariff Kabunsuan comprising the municipalities of Barira,
Buldon, Datu Odin Sinsuat, Kabuntalan, Matanog, Parang, Sultan Kudarat, Sultan
Mastura and Upi, all of the first legislative district of the mother Province of
Maguindanao, except Cotabato City which is not part of the Autonomous Region
in Muslim Mindanao; while the remaining municipalities of Talisay, Talayan,
Guindulungan, Datu Saudi Ampatuan, Datu Piang, Shariff Aguak, Datu Unsay,
Mamasapano, South Upi, Ampatuan, Datu Abdullah Sangki, Buluan, Datu Paglas,
Gen. S. K. Pendatun, Sultan Sa Barongis, Rajah Buayan, Pagalungan, Pagagawan,
and Paglat, all of the second legislative district of the mother Province of
Maguindanao, shall remain with said province;
WHEREAS, the last paragraph of Section 5 of Muslim Mindanao Autonomy

(MMA) Act No. 201 provides that (e)xcept as may be provided by national law,
the existing legislative district, which includes Cotabato City as a part thereof, shall
remain.;
WHEREAS, by reason of said provision of MMA Act No. 201, the first
legislative district of the Province of Maguindanao is now made up of
Cotabato City only, and its second legislative district, the municipalities of
Talisay, Talayan, Guindulungan, Datu Saudi Ampatuan, Datu Piang, Shariff
Aguak, Datu Unsay, Mamasapano, South Upi, Ampatuan, Datu Abdullah
Sangki, Buluan, Datu Paglas, Gen. S. K. Pendatun, Sultan Sa Barongis, Rajah
Buayan, Pagalungan, Pagagawan, and Paglat[.] (Emphasis supplied)
In the earlier Resolution No. 7801, dated 11 January 2007, the COMELEC allocated one legislative
seat each for the provinces of Maguindanao and Shariff Kabunsuan for the 14 May 2007 elections.
[9]
Resolution No. 7902 reads in full:
This pertains to the amendment of Minute Resolution No. 07-0407 dated March 6, 2007,
entitled, IN THE MATTER OF THE MEMORANDUM OF ATTY. WYNNE B.
ASDALA, ACTING DIRECTOR III, LAW DEPARTMENT, RELATIVE TO THE
STUDY/RECOMMENDATION OF SAID DEPARTMENT RE: CONVERSION OF
THE FIRST DISTRICT OF MAGUINDANAO INTO A REGULAR PROVINCE PER
MINUTE RESOLUTION NO. 07-0297 DATED FEBRUARY 20, 2007. The dispositive
portion of which reads:
Considering the foregoing, the Commission RESOLVED, as it hereby

RESOLVES, to adopt the recommendation of the Law Department that
pending the enactment of the appropriate law by Congress, to maintain
status quo with Cotabato City as part of Shariff Kabunsuan in the First
District of Maguindanao.
The Commission RESOLVED, as it hereby RESOLVES, to amend the pertinent portion

of Minute Resolution No. 07-0407 to now read, as follows[:]
[]Considering the foregoing, the Commission RESOLVED, as it hereby
RESOLVES, that the district shall be known as Shariff Kabunsuan
Province with Cotabato City (formerly First District of Maguindanao
with Cotabato City).
Let the Executive Director advise the Sangguniang Panlalawigan of Cotabato City
accordingly. (Emphasis in the original)
[10]
Each legislative district shall comprise, as far as practicable, contiguous, compact, and adjacent territory.
Each city with a population of at least two hundred fifty thousand, or each province, shall have at
least one representative.
[11]
Any province that may hereafter be created, or any city whose population may hereafter increase to
more than two hundred fifty thousand shall be entitled in the immediately following election to at
least one Member or such number of Members as it may be entitled to on the basis of the number
of its inhabitants and according to the standards set forth in paragraph (3), Section 5 of Article VI
of the Constitution. The number of Members apportioned to the province out of which such new
province was created or where the city, whose population has so increased, is geographically
located shall be correspondingly adjusted by the Commission on Elections but such adjustment
shall not be made within one hundred and twenty days before the election.
[12]
Consistent with her claim that Cotabato City is not part of Shariff Kabunsuans legislative district,
petitioner filed with the COMELEC a petition for the disqualification of respondent Dilangalen as
candidate for representative of that province (docketed as SPA No. A07-0).
[13]
Respondent Dilangalen asserts, and petitioner does not dispute, that as of 2000, Cotabato City had a
population of 163,849, falling short of the minimum population requirement in Section 5 (3),
Article VI of the Constitution which provides: Each legislative district shall comprise, as far as
practicable, contiguous, compact, and adjacent territory. Each city with a population of at least
two hundred fifty thousand, or each province, shall have at least one representative. (Emphasis
supplied)
[14]
124 Phil. 1226 (1966).
[15]
As provided in the Resolution of 16 October 2007.
[16]
The Court also required Sema to submit with her Memorandum the certifications from the Department
of Finance, the Lands Management Bureau, the National Statistics Office, and the Department of
Interior and Local Government that at the time of the creation of Shariff Kabunsuan on 28 August
2006 it met the requisites for the creation of a province under Section 461 of RA 7160.
[17]
SEC. 6. Authority to Create Local Government Units. - A local government unit may be created, divided,
merged, abolished, or its boundaries substantially altered either by law enacted by Congress in the
case of a province, city or municipality, or any other political subdivision, or by ordinance passed
by the sangguniang panlalawigan or sangguniang panlungsod concerned in the case of a barangay
located within its territorial jurisdiction, subject to such limitations and requirements prescribed in
this Code.
[18]
SECTION 10. No province, city, municipality, or barangay may be created, divided, merged, abolished,
or its boundary substantially altered, except in accordance with the criteria established in the Local
Government Code and subject to approval by a majority of the votes cast in a plebiscite in the
political units directly affected.
[19]
Rollo, p. 229.
[20]
SECTION 6. Local government units shall have a just share, as determined by law, in the national taxes
which shall be automatically released to them.
[21]
Section 1, Rule 65 of the 1997 Rules of Civil Procedure.
[22]
Section 3, Rule 65 of the 1997 Rules of Civil Procedure.
[23]
See, however, Macabago v. Commission on Elections (440 Phil. 683 [2002]) where the Court held that
a petition for certiorari under Rule 65 will lie to question the constitutionality of an election
regulation if the COMELEC has acted capriciously or whimsically, with grave abuse of discretion
amounting to lack or excess of jurisdiction.
[24]
Social Weather Stations, Inc. v. COMELEC, 409 Phil. 571 (2001); Mutuc v. Commission on Elections,
G.R. No. L-32717, 26 November 1970, 36 SCRA 228.
[25]
Sections 385 and 386, RA 7160.
[26]
Sections 441, 449 and 460, RA 7160.
[27]
Section 20, Article X, Constitution.
[28]
See Section 2, Article VIII of the 1973 Constitution and Section 5, Article VI of the 1935 Constitution.
[29]
312 Phil. 492, 501 (1995).
[30]
Section 48 of Republic Act No. 8507 (Charter of Paraaque City) provides:
Section 48. Legislative District. As a highly-urbanized city, the City of
Paraaque shall have its own legislative district with the first representative to be
elected in the next national election after the passage of this Act. (Emphasis
supplied)
Section 50 of Republic Act No. 7839 (Charter of City of Pasig) provides:
Section 50. Legislative District. As highly urbanized, the City of Pasig

shall have its own legislative district with the first representative to be elected in
the next national elections after the passage of this Act. (Emphasis supplied)
Section 58 of Republic Act No. RA 9230 provides:
Section 58. Representative District. The City of San Jose del Monte shall
have its own representative district to commence in the next national
election after the effectivity of this Act. (Emphasis supplied)
Section 7 of Republic Act No. 9355 provides:
Section 7. Legislative District. The Province of Dinagat Islands shall constitute

one, separate legislative district to commence in the next national election after
the effectivity of this Act. (Emphasis supplied)
[31]
In his Concurring Opinion in Paras v. Commission on Elections (332 Phil. 56, 66 [1996]),
then Associate Justice (later Chief Justice) Hilario G. Davide, Jr. stated:
The term regular local election must be confined to the regular election of elective
local officials, as distinguished from the regular election of national officials. The
elective national officials are the President, Vice-President, Senators and
Congressmen. The elective local officials are Provincial Governors, Vice-
Governors of provinces, Mayors and Vice-Mayors of cities and municipalities,
Members of the Sanggunians of provinces, cities and municipalities, punong
barangays and members of the sangguniang barangays, and the elective regional
officials of the Autonomous Region of Muslim Mindanao. These are the only local
elective officials deemed recognized by Section 2(2) of Article IX-C of the
Constitution, which provides:
SEC. 2. The Commission on Elections shall exercise the following powers and
functions:
xxxx
(2) Exercise exclusive original jurisdiction over all contests
relating to the elections, returns, and qualifications of all elective
regional, provincial, and city officials, and appellate jurisdiction
over all contests involving elective municipal officials decided by
trial courts of general jurisdiction, or involving elective barangay
officials decided by trial courts of limited jurisdiction. (Emphasis
supplied)
[32]
Supra note 13 at 1235-1236.
[33]
See note 3.
[34]
Section 461 provides: Requisites for Creation. (a) A province may be created if it has an average annual
income, as certified by the Department of Finance, of not less than Twenty million pesos
(P20,000,000.00) based on 1991 constant prices and either of the following requisites:
(i) a contiguous territory of at least two thousand (2,000) square kilometers, as certified by the Lands
Management Bureau; or
(ii) a population of not less than two hundred fifty thousand (250,000) inhabitants as
certified by the National Statistics Office: Provided, That, the creation thereof shall not
reduce the land area, population, and income of the original unit or units at the time of said
creation to less than the minimum requirements prescribed herein.
(b) The territory need not be contiguous if it comprise two (2) or more islands or is separated by a chartered
city or cities which do not contribute to the income of the province.
(c) The average annual income shall include the income accruing to the general fund, exclusive of special
funds, trust funds, transfers and non-recurring income.
[35]
Atty. Edgardo Carlos B. Vistan II, counsel for petitioner in G.R. No. 177597.
[36]
TSN (27 November 2007), pp. 64-69.
[37]
Unlike the 1935 and the 1973 Constitutions, the 1987 Constitution mandates, in Section 15, Article X,
the creation of autonomous regions in the Cordilleras and Muslim Mindanao to foster political
autonomy. See Cordillera Broad Coalition v. Commission on Audit, G.R. No. 79956, 29 January
1990, 181 SCRA 495.
[38]
Website of House of Representatives as of 12 May 2008.
EN BANC
ROMEO P. GEROCHI, KATULONG NG G.R. No. 159796

BAYAN (KB) and ENVIRONMENTALIST
CONSUMERS NETWORK, INC. (ECN), Present:
Petitioners,
PUNO, C.J.,
-versus- QUISUMBING,
YNARES-SANTIAGO,
DEPARTMENT OF ENERGY (DOE), SANDOVAL-GUTIERREZ,
ENERGY REGULATORY COMMISSION CARPIO,
(ERC), NATIONAL POWER AUSTRIA-MARTINEZ,
CORPORATION (NPC), POWER CORONA,
SECTOR ASSETS AND LIABILITIES CARPIO MORALES,
MANAGEMENT GROUP (PSALM Corp.), AZCUNA,
STRATEGIC POWER UTILITIES GROUP TINGA,
(SPUG), and PANAYELECTRIC CHICO-NAZARIO,
COMPANY INC. (PECO), GARCIA,
Respondents. VELASCO, JR. and
NACHURA, JJ.
Promulgated:
July 17, 2007

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x
DECISION
NACHURA, J.:
Petitioners Romeo P. Gerochi, Katulong Ng Bayan (KB), and Environmentalist Consumers Network, Inc.
(ECN) (petitioners), come before this Court in this original action praying that Section 34 of Republic Act
(RA) 9136, otherwise known as the Electric Power Industry Reform Act of 2001 (EPIRA), imposing the
Universal Charge,[1] and Rule 18 of the Rules and Regulations (IRR)[2] which seeks to implement the said
imposition, be declared unconstitutional. Petitioners also pray that the Universal Charge imposed upon the
consumers be refunded and that a preliminary injunction and/or temporary restraining order (TRO) be
issued directing the respondents to refrain from implementing, charging, and collecting the said
charge.[3] The assailed provision of law reads:
SECTION 34. Universal Charge. Within one (1) year from the effectivity of this
Act, a universal charge to be determined, fixed and approved by the ERC, shall be imposed
on all electricity end-users for the following purposes:
(a) Payment for the stranded debts[4] in excess of the amount assumed by the National
Government and stranded contract costs of NPC[5] and as well as qualified stranded
contract costs of distribution utilities resulting from the restructuring of the industry;
(b) Missionary electrification;[6]
(c) The equalization of the taxes and royalties applied to indigenous or renewable sources
of energy vis--vis imported energy fuels;
(d) An environmental charge equivalent to one-fourth of one centavo per kilowatt-hour

(P0.0025/kWh), which shall accrue to an environmental fund to be used solely for
watershed rehabilitation and management. Said fund shall be managed by NPC under
existing arrangements; and
(e) A charge to account for all forms of cross-subsidies for a period not exceeding three (3)
years.
The universal charge shall be a non-bypassable charge which shall be passed on and
collected from all end-users on a monthly basis by the distribution utilities. Collections by
the distribution utilities and the TRANSCO in any given month shall be remitted to the
PSALM Corp. on or before the fifteenth (15th) of the succeeding month, net of any amount
due to the distribution utility. Any end-user or self-generating entity not connected to a
distribution utility shall remit its corresponding universal charge directly to the
TRANSCO. The PSALM Corp., as administrator of the fund, shall create a Special Trust
Fund which shall be disbursed only for the purposes specified herein in an open and
transparent manner. All amount collected for the universal charge shall be distributed to
the respective beneficiaries within a reasonable period to be provided by the ERC.
The Facts
Congress enacted the EPIRA on June 8, 2001; on June 26, 2001, it took effect.[7]
On April 5, 2002, respondent National Power Corporation-Strategic Power Utilities Group[8] (NPC-SPUG)
filed with respondent Energy Regulatory Commission (ERC) a petition for the availment from the Universal
Charge of its share for Missionary Electrification, docketed as ERC Case No. 2002-165.[9]
On May 7, 2002, NPC filed another petition with ERC, docketed as ERC Case No. 2002-194, praying that
the proposed share from the Universal Charge for the Environmental charge of P0.0025 per kilowatt-hour
(/kWh), or a total of P119,488,847.59, be approved for withdrawal from the Special
Trust Fund (STF) managed by respondent Power SectorAssets and
Liabilities Management Group (PSALM)[10] for the rehabilitation and management of watershed areas.[11]
On December 20, 2002, the ERC issued an Order[12] in ERC Case No. 2002-165 provisionally approving
the computed amount of P0.0168/kWh as the share of the NPC-SPUG from the Universal Charge for
Missionary Electrification and authorizing the National Transmission Corporation (TRANSCO) and
Distribution Utilities to collect the same from its end-users on a monthly basis.
On June 26, 2003, the ERC rendered its Decision[13] (for ERC Case No. 2002-165) modifying its Order of
December 20, 2002, thus:
WHEREFORE, the foregoing premises considered, the provisional authority

granted to petitioner National Power Corporation-Strategic Power Utilities Group (NPC-
SPUG) in the Order dated December 20, 2002 is hereby modified to the effect that an
additional amount of P0.0205 per kilowatt-hour should be added to the P0.0168 per
kilowatt-hour provisionally authorized by the Commission in the said Order. Accordingly,
a total amount of P0.0373 per kilowatt-hour is hereby APPROVED for withdrawal from
the Special Trust Fund managed by PSALM as its share from the Universal Charge for
Missionary Electrification (UC-ME) effective on the following billing cycles:
(a) June 26-July 25, 2003 for National Transmission Corporation (TRANSCO);
and
(b) July 2003 for Distribution Utilities (Dus).
Relative thereto, TRANSCO and Dus are directed to collect the UC-ME in the
amount of P0.0373 per kilowatt-hour and remit the same to PSALM on or before the
15th day of the succeeding month.
In the meantime, NPC-SPUG is directed to submit, not later than April 30, 2004,
a detailed report to include Audited Financial Statements and physical status (percentage
of completion) of the projects using the prescribed format.
Let copies of this Order be furnished petitioner NPC-SPUG and all distribution
utilities (Dus).
SO ORDERED.
On August 13, 2003, NPC-SPUG filed a Motion for Reconsideration asking the ERC, among others,[14] to
set aside the above-mentioned Decision, which the ERC granted in its Order dated October 7, 2003,
disposing:
WHEREFORE, the foregoing premises considered, the Motion for Reconsideration filed
by petitioner National Power Corporation-Small Power Utilities Group (NPC-SPUG) is
hereby GRANTED. Accordingly, the Decision dated June 26, 2003 is hereby modified
accordingly.
Relative thereto, NPC-SPUG is directed to submit a quarterly report on the following:
1. Projects for CY 2002 undertaken;

2. Location
3. Actual amount utilized to complete the project;
4. Period of completion;
5. Start of Operation; and
6. Explanation of the reallocation of UC-ME funds, if any.
SO ORDERED.[15]
Meanwhile, on April 2, 2003, ERC decided ERC Case No. 2002-194, authorizing the NPC to draw up
to P70,000,000.00 from PSALM for its 2003 Watershed Rehabilitation Budget subject to the availability
of funds for the Environmental Fund component of the Universal Charge.[16]
On the basis of the said ERC decisions, respondent Panay Electric Company, Inc. (PECO)
charged petitioner Romeo P. Gerochi and all other
end-users with the Universal Charge as reflected in their respective electric bills starting from the month of
July 2003.[17]
Hence, this original action.
Petitioners submit that the assailed provision of law and its IRR which sought to implement the same are
unconstitutional on the following grounds:
1) The universal charge provided for under Sec. 34 of the EPIRA and sought to be
implemented under Sec. 2, Rule 18 of the IRR of the said law is a tax which is to be
collected from all electric end-users and self-generating entities. The power to tax is
strictly a legislative function and as such, the delegation of said power to any executive
or administrative agency like the ERC is unconstitutional, giving the same unlimited
authority. The assailed provision clearly provides that the Universal Charge is to be
determined, fixed and approved by the ERC, hence leaving to the latter complete
discretionary legislative authority.
2) The ERC is also empowered to approve and determine where the funds collected
should be used.
3) The imposition of the Universal Charge on all end-users is oppressive and

confiscatory and amounts to taxation without representation as the consumers were not
given a chance to be heard and represented.[18]
Petitioners contend that the Universal Charge has the characteristics of a tax and is collected to fund
the operations of the NPC. They argue that the cases[19] invoked by the respondents clearly show the
regulatory purpose of the charges imposed therein, which is not so in the case at bench. In said cases, the
respective funds[20] were created in order to balance and stabilize the prices of oil and sugar, and to act as
buffer to counteract the changes and adjustments in prices, peso devaluation, and other variables which
cannot be adequately and timely monitored by the legislature. Thus, there was a need to delegate powers to
administrative bodies.[21] Petitioners posit that the Universal Charge is imposed not for a similar purpose.
On the other hand, respondent PSALM through the Office of the Government Corporate Counsel (OGCC)
contends that unlike a tax which is imposed to provide income for public purposes, such as support of the
government, administration of the law, or payment of public expenses, the assailed Universal Charge is
levied for a specific regulatory purpose, which is to ensure the viability of the country's electric power
industry. Thus, it is exacted by the State in the exercise of its inherent police power. On this premise,
PSALM submits that there is no undue delegation of legislative power to the ERC since the latter merely
exercises a limited authority or discretion as to the execution and implementation of the provisions of the
EPIRA.[22]
Respondents Department of Energy (DOE), ERC, and NPC, through the Office of the Solicitor General
(OSG), share the same view that the Universal Charge is not a tax because it is levied for a specific
regulatory purpose, which is to ensure the viability of the country's electric power industry, and is, therefore,
an exaction in the exercise of the State's police power. Respondents further contend that said Universal
Charge does not possess the essential characteristics of a tax, that its imposition would redound to the
benefit of the electric power industry and not to the public, and that its rate is uniformly levied on electricity
end-users, unlike a tax which is imposed based on the individual taxpayer's ability to pay. Moreover,
respondents deny that there is undue delegation of legislative power to the ERC since the EPIRA sets forth
sufficient determinable standards which would guide the ERC in the exercise of the powers granted to it.
Lastly, respondents argue that the imposition of the Universal Charge is not oppressive and confiscatory
since it is an exercise of the police power of the State and it complies with the requirements of due
process.[23]
On its part, respondent PECO argues that it is duty-bound to collect and remit the amount pertaining to the
Missionary Electrification and Environmental Fund components of the Universal Charge, pursuant to Sec.
34 of the EPIRA and the Decisions in ERC Case Nos. 2002-194 and 2002-165. Otherwise, PECO could be
held liable under Sec. 46[24] of the EPIRA, which imposes fines and penalties for any violation of its
provisions or its IRR.[25]
The Issues
The ultimate issues in the case at bar are:
1) Whether or not, the Universal Charge imposed under Sec. 34 of the EPIRA is a tax;
and
2) Whether or not there is undue delegation of legislative power to tax on the part of the
ERC.[26]
Before we discuss the issues, the Court shall first deal with an obvious procedural lapse.
Petitioners filed before us an original action particularly denominated as a Complaint assailing the
constitutionality of Sec. 34 of the EPIRA imposing the Universal Charge and Rule 18 of the EPIRA's IRR.
No doubt, petitioners have locus standi. They impugn the constitutionality of Sec. 34 of the EPIRA because
they sustained a direct injury as a result of the imposition of the Universal Charge as reflected in their
electric bills.
However, petitioners violated the doctrine of hierarchy of courts when they filed this Complaint
directly with us. Furthermore, the Complaint is bereft of any allegation of grave abuse of discretion on the
part of the ERC or any of the public respondents, in order for the Court to consider it as a petition
for certiorari or prohibition.
Article VIII, Section 5(1) and (2) of the 1987 Constitution[27] categorically provides that:
SECTION 5. The Supreme Court shall have the following powers:
1. Exercise original jurisdiction over cases affecting ambassadors, other public

ministers and consuls, and over petitions for certiorari, prohibition, mandamus, quo
warranto, and habeas corpus.
2. Review, revise, reverse, modify, or affirm on appeal or certiorari, as the law or the
rules of court may provide, final judgments and orders of lower courts in:
(a) All cases in which the constitutionality or validity of any treaty,

international or executive agreement, law, presidential decree,
proclamation, order, instruction, ordinance, or regulation is in
question.
But this Court's jurisdiction to issue writs of certiorari, prohibition, mandamus, quo warranto, and habeas
corpus, while concurrent with that of the regional trial courts and the Court of Appeals, does not give
litigants unrestrained freedom of choice of forum from which to seek such relief.[28] It has long been
established that this Court will not entertain direct resort to it unless the redress desired cannot be obtained
in the appropriate courts, or where exceptional and compelling circumstances justify availment of a remedy
within and call for the exercise of our primary jurisdiction.[29] This circumstance alone warrants the outright
dismissal of the present action.
This procedural infirmity notwithstanding, we opt to resolve the constitutional issue raised
herein. We are aware that if the constitutionality of Sec. 34 of the EPIRA is not resolved now, the issue will
certainly resurface in the near future, resulting in a repeat of this litigation, and probably involving the same
parties. In the public interest and to avoid unnecessary delay, this Court renders its ruling now.
The instant complaint is bereft of merit.
The First Issue
To resolve the first issue, it is necessary to distinguish the States power of taxation from the police
power.
The power to tax is an incident of sovereignty and is unlimited in its range, acknowledging in its very nature
no limits, so that security against its abuse is to be found only in the responsibility of the legislature which
imposes the tax on the constituency that is to pay it.[30] It is based on the principle that taxes are the lifeblood
of the government, and their prompt and certain availability is an imperious need.[31] Thus, the theory behind
the exercise of the power to tax emanates from necessity; without taxes, government cannot fulfill its
mandate of promoting the general welfare and well-being of the people.[32]
On the other hand, police power is the power of the state to promote public welfare by restraining and
regulating the use of liberty and property.[33] It is the most pervasive, the least limitable, and the most
demanding of the three fundamental powers of the State. The justification is found in the Latin
maxims salus populi est suprema lex (the welfare of the people is the supreme law) and sic utere tuo ut
alienum non laedas (so use your property as not to injure the property of others). As an inherent attribute
of sovereignty which virtually extends to all public needs, police power grants a wide panoply of
instruments through which the State, as parens patriae, gives effect to a host of its regulatory powers.[34] We
have held that the power to "regulate" means the power to protect, foster, promote, preserve, and control,
with due regard for the interests, first and foremost, of the public, then of the utility and of its patrons.[35]
The conservative and pivotal distinction between these two powers rests in the purpose for which
the charge is made. If generation of revenue is the primary purpose and regulation is merely incidental, the
imposition is a tax; but if regulation is the primary purpose, the fact that revenue is incidentally raised does
not make the imposition a tax.[36]
In exacting the assailed Universal Charge through Sec. 34 of the EPIRA, the State's police power,
particularly its regulatory dimension, is invoked. Such can be deduced from Sec. 34 which enumerates the
purposes for which the Universal Charge is imposed[37] and which can be amply discerned as regulatory in
character. The EPIRA resonates such regulatory purposes, thus:
SECTION 2. Declaration of Policy. It is hereby declared the policy of the State:
(a) To ensure and accelerate the total electrification of the country;

(b) To ensure the quality, reliability, security and affordability of the supply of electric
power;
(c) To ensure transparent and reasonable prices of electricity in a regime of free and fair
competition and full public accountability to achieve greater operational and
economic efficiency and enhance the competitiveness of Philippine products in the
global market;
(d) To enhance the inflow of private capital and broaden the ownership base of the power
generation, transmission and distribution sectors;
(e) To ensure fair and non-discriminatory treatment of public and private sector entities in
the process of restructuring the electric power industry;
(f) To protect the public interest as it is affected by the rates and services of electric utilities
and other providers of electric power;
(g) To assure socially and environmentally compatible energy sources and infrastructure;
(h) To promote the utilization of indigenous and new and renewable energy resources in
power generation in order to reduce dependence on imported energy;
(i) To provide for an orderly and transparent privatization of the assets and liabilities of the
National Power Corporation (NPC);
(j) To establish a strong and purely independent regulatory body and system to ensure
consumer protection and enhance the competitive operation of the electricity market;
and
(k) To encourage the efficient use of energy and other modalities of demand side
management.
From the aforementioned purposes, it can be gleaned that the assailed Universal Charge is not a tax, but an
exaction in the exercise of the State's police power. Public welfare is surely promoted.
Moreover, it is a well-established doctrine that the taxing power may be used as an implement of police
power.[38] In Valmonte v. Energy Regulatory Board, et al.[39] and in Gaston v. Republic Planters
Bank,[40] this Court held that the Oil Price Stabilization Fund (OPSF) and the Sugar Stabilization Fund
(SSF) were exactions made in the exercise of the police power. The doctrine was reiterated in Osmea v.
Orbos[41] with respect to the OPSF. Thus, we disagree with petitioners that the instant case is different from
the aforementioned cases. With the Universal Charge, a Special Trust Fund (STF) is also created under the
administration of PSALM.[42] The STF has some notable characteristics similar to the OPSF and the
SSF, viz.:
1) In the implementation of stranded cost recovery, the ERC shall conduct a review to
determine whether there is under-recovery or over recovery and adjust (true-up) the
level of the stranded cost recovery charge. In case of an over-recovery, the ERC shall
ensure that any excess amount shall be remitted to the STF. A separate account shall
be created for these amounts which shall be held in trust for any future claims of
distribution utilities for stranded cost recovery. At the end of the stranded cost recovery
period, any remaining amount in this account shall be used to reduce the electricity
rates to the end-users.[43]
2) With respect to the assailed Universal Charge, if the total amount collected for the
same is greater than the actual availments against it, the PSALM shall retain the
balance within the STF to pay for periods where a shortfall occurs.[44]
3) Upon expiration of the term of PSALM, the administration of the STF shall be
transferred to the DOF or any of the DOF attached agencies as designated by the DOF
Secretary.[45]
The OSG is in point when it asseverates:

Evidently, the establishment and maintenance of the Special Trust Fund, under the last
paragraph of Section 34, R.A. No. 9136, is well within the pervasive and non-waivable
power and responsibility of the government to secure the physical and economic survival
and well-being of the community, that comprehensive sovereign authority we designate as
the police power of the State.[46]
This feature of the Universal Charge further boosts the position that the same is an exaction imposed
primarily in pursuit of the State's police objectives. The STF reasonably serves and assures the attainment
and perpetuity of the purposes for which the Universal Charge is imposed, i.e., to ensure the viability of the
country's electric power industry.
The Second Issue
The principle of separation of powers ordains that each of the three branches of government has
exclusive cognizance of and is supreme in matters falling within its own constitutionally allocated sphere.
A logical corollary to the doctrine of separation of powers is the principle of non-delegation of powers, as
expressed in the Latin maxim potestas delegata non delegari potest (what has been delegated cannot be
delegated). This is based on the ethical principle that such delegated power constitutes not only a right but
a duty to be performed by the delegate through the instrumentality of his own judgment and not through
the intervening mind of another. [47]
In the face of the increasing complexity of modern life, delegation of legislative power to various
specialized administrative agencies is allowed as an exception to this principle. [48] Given the volume and
variety of interactions in today's society, it is doubtful if the legislature can promulgate laws that will deal
adequately with and respond promptly to the minutiae of everyday life. Hence, the need to delegate to
administrative bodies - the principal agencies tasked to execute laws in their specialized fields - the authority
to promulgate rules and regulations to implement a given statute and effectuate its policies. All that is
required for the valid exercise of this power of subordinate legislation is that the regulation be germane to
the objects and purposes of the law and that the regulation be not in contradiction to, but in conformity
with, the standards prescribed by the law. These requirements are denominated as the completeness test and
the sufficient standard test.
Under the first test, the law must be complete in all its terms and conditions when it leaves the legislature
such that when it reaches the delegate, the only thing he will have to do is to enforce it. The second test
mandates adequate guidelines or limitations in the law to determine the boundaries of the delegate's
authority and prevent the delegation from running riot.[49]
The Court finds that the EPIRA, read and appreciated in its entirety, in relation to Sec. 34 thereof, is
complete in all its essential terms and conditions, and that it contains sufficient standards.
Although Sec. 34 of the EPIRA merely provides that within one (1) year from the effectivity thereof, a
Universal Charge to be determined, fixed and approved by the ERC, shall be imposed on all electricity end-
users, and therefore, does not state the specific amount to be paid as Universal Charge, the amount
nevertheless is made certain by the legislative parameters provided in the law itself. For one, Sec. 43(b)(ii)
of the EPIRA provides:
SECTION 43. Functions of the ERC. The ERC shall promote competition, encourage
market development, ensure customer choice and penalize abuse of market power in the
restructured electricity industry. In appropriate cases, the ERC is authorized to issue cease
and desist order after due notice and hearing. Towards this end, it shall be responsible for
the following key functions in the restructured industry:
xxxx
(b) Within six (6) months from the effectivity of this Act, promulgate and enforce, in
accordance with law, a National Grid Code and a Distribution Code which shall include,
but not limited to the following:
xxxx
(ii) Financial capability standards for the generating companies, the TRANSCO,
distribution utilities and suppliers: Provided, That in the formulation of the financial
capability standards, the nature and function of the entity shall be considered: Provided,
further, That such standards are set to ensure that the electric power industry participants
meet the minimum financial standards to protect the public interest. Determine, fix, and
approve, after due notice and public hearings the universal charge, to be imposed on all
electricity end-users pursuant to Section 34 hereof;
Moreover, contrary to the petitioners contention, the ERC does not enjoy a wide latitude of discretion in
the determination of the Universal Charge. Sec. 51(d) and (e) of the EPIRA[50] clearly provides:
SECTION 51. Powers. The PSALM Corp. shall, in the performance of its functions and
for the attainment of its objective, have the following powers:
xxxx
(d) To calculate the amount of the stranded debts and stranded contract costs of NPC
which shall form the basis for ERC in the determination of the universal charge;
(e) To liquidate the NPC stranded contract costs, utilizing the proceeds from sales and
other property contributed to it, including the proceeds from the universal charge.
Thus, the law is complete and passes the first test for valid delegation of legislative power.
As to the second test, this Court had, in the past, accepted as sufficient standards the following: "interest of
law and order;"[51] "adequate and efficient instruction;"[52] "public interest;"[53] "justice and
equity;"[54] "public convenience and welfare;"[55] "simplicity, economy and efficiency;"[56] "standardization
and regulation of medical education;"[57] and "fair and equitable employment practices."[58] Provisions of
the EPIRA such as, among others, to ensure the total electrification of the country and the quality, reliability,
security and affordability of the supply of electric power[59] and watershed rehabilitation and
management[60] meet the requirements for valid delegation, as they provide the limitations on the ERCs
power to formulate the IRR. These are sufficient standards.
It may be noted that this is not the first time that the ERC's conferred powers were challenged. In Freedom
from Debt Coalition v. Energy Regulatory Commission,[61] the Court had occasion to say:
In determining the extent of powers possessed by the ERC, the provisions of the EPIRA
must not be read in separate parts. Rather, the law must be read in its entirety, because a
statute is passed as a whole, and is animated by one general purpose and intent. Its meaning
cannot to be extracted from any single part thereof but from a general consideration of the
statute as a whole. Considering the intent of Congress in enacting the EPIRA and reading
the statute in its entirety, it is plain to see that the law has expanded the jurisdiction of the
regulatory body, the ERC in this case, to enable the latter to implement the reforms sought
to be accomplished by the EPIRA. When the legislators decided to broaden the jurisdiction
of the ERC, they did not intend to abolish or reduce the powers already conferred upon
ERC's predecessors. To sustain the view that the ERC possesses only the powers and
functions listed under Section 43 of the EPIRA is to frustrate the objectives of the law.
In his Concurring and Dissenting Opinion[62] in the same case, then Associate Justice, now Chief Justice,
Reynato S. Puno described the immensity of police power in relation to the delegation of powers to the
ERC and its regulatory functions over electric power as a vital public utility, to wit:
Over the years, however, the range of police power was no longer limited to the
preservation of public health, safety and morals, which used to be the primary social
interests in earlier times. Police power now requires the State to "assume an affirmative
duty to eliminate the excesses and injustices that are the concomitants of an unrestrained
industrial economy." Police power is now exerted "to further the public welfare a concept
as vast as the good of society itself." Hence, "police power is but another name for the
governmental authority to further the welfare of society that is the basic end of all
government." When police power is delegated to administrative bodies with regulatory
functions, its exercise should be given a wide latitude. Police power takes on an even
broader dimension in developing countries such as ours, where the State must take a more
active role in balancing the many conflicting interests in society. The Questioned Order
was issued by the ERC, acting as an agent of the State in the exercise of police power. We
should have exceptionally good grounds to curtail its exercise. This approach is more
compelling in the field of rate-regulation of electric power rates. Electric power generation
and distribution is a traditional instrument of economic growth that affects not only a few
but the entire nation. It is an important factor in encouraging investment and promoting
business. The engines of progress may come to a screeching halt if the delivery of electric
power is impaired. Billions of pesos would be lost as a result of power outages or
unreliable electric power services. The State thru the ERC should be able to exercise its
police power with great flexibility, when the need arises.
This was reiterated in National Association of Electricity Consumers for Reforms v. Energy Regulatory
Commission[63] where the Court held that the ERC, as regulator, should have sufficient power to respond in
real time to changes wrought by multifarious factors affecting public utilities.
From the foregoing disquisitions, we therefore hold that there is no undue delegation of legislative power
to the ERC.
Petitioners failed to pursue in their Memorandum the contention in the Complaint that the
imposition of the Universal Charge on all end-users is oppressive and confiscatory, and amounts to taxation
without representation. Hence, such contention is deemed waived or abandoned per Resolution [64] of
August 3, 2004.[65] Moreover, the determination of whether or not a tax is excessive, oppressive or
confiscatory is an issue which essentially involves questions of fact, and thus, this Court is precluded from
reviewing the same.[66]
As a penultimate statement, it may be well to recall what this Court said of EPIRA:
One of the landmark pieces of legislation enacted by Congress in recent years is the EPIRA.
It established a new policy, legal structure and regulatory framework for the electric power
industry. The new thrust is to tap private capital for the expansion and improvement of the
industry as the large government debt and the highly capital-intensive character of the
industry itself have long been acknowledged as the critical constraints to the program. To
attract private investment, largely foreign, the jaded structure of the industry had to be
addressed. While the generation and transmission sectors were centralized and
monopolistic, the distribution side was fragmented with over 130 utilities, mostly small
and uneconomic. The pervasive flaws have caused a low utilization of existing generation
capacity; extremely high and uncompetitive power rates; poor quality of service to
consumers; dismal to forgettable performance of the government power sector; high system
losses; and an inability to develop a clear strategy for overcoming these shortcomings.
Thus, the EPIRA provides a framework for the restructuring of the industry, including the
privatization of the assets of the National Power Corporation (NPC), the transition to a
competitive structure, and the delineation of the roles of various government agencies and
the private entities. The law ordains the division of the industry into four (4) distinct
sectors, namely: generation, transmission, distribution and supply.
Corollarily, the NPC generating plants have to privatized and its transmission business
spun off and privatized thereafter.[67]
Finally, every law has in its favor the presumption of constitutionality, and to justify its nullification, there
must be a clear and unequivocal breach of the Constitution and not one that is doubtful, speculative, or
argumentative.[68] Indubitably, petitioners failed to overcome this presumption in favor of the EPIRA. We
find no clear violation of the Constitution which would warrant a pronouncement that Sec. 34 of the EPIRA
and Rule 18 of its IRR are unconstitutional and void.
WHEREFORE, the instant case is hereby DISMISSED for lack of merit.
SO ORDERED.
ANTONIO EDUARDO B. NACHURA

Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
LEONARDO A. QUISUMBING CONSUELO YNARES-SANTIAGO

ANGELINA SANDOVAL-GUTIERREZ ANTONIO T. CARPIO
MA. ALICIA AUSTRIA-MARTINEZ RENATO C. CORONA

CONCHITA CARPIO MORALES ADOLFO S. AZCUNA

DANTE O. TINGA MINITA V. CHICO-NAZARIO

CANCIO C. GARCIA PRESBITERO J. VELASCO, JR.

CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above
Decision had been reached in consultation before the case was assigned to the writer of the opinion of the
Court.
REYNATO S. PUNO
Chief Justice
[1]
Sec. 4 (ddd) of the EPIRA provides that the Universal Charge refers to the charge, if any, imposed for
the recovery of the stranded cost and other purposes pursuant to Section 34 hereof.
[2]
Rules and Regulations to Implement Republic Act No. 9136, entitled "Electric Power Industry Reform
Act of 2001, (IRR) approved on February 27, 2002, particularly Rule 4 (rrrr) provides that the "Universal
Charge" refers to the charge, if any, imposed for the recovery of the Stranded Debts, Stranded Contract
Costs of NPC, and Stranded Contract Costs of Eligible Contracts of Distribution Utilities and other purposes
pursuant to Section 34 of the EPIRA.
[3]
Particularly denominated as Complaint dated September 15, 2003; rollo, pp. 3-15.
[4]
Sec. 4 [vv] of the EPIRA provides that Stranded Debts of NPC refer to any unpaid financial obligations
of NPC which have not been liquidated by the proceeds from the sales and privatization of NPC assets.
[5]
Sec. 4 [uu] of the EPIRA also provides that Stranded contract costs of NPC or distribution utility refer to
the excess of the contracted cost of electricity under eligible contracts over the actual selling price of the
contracted energy output of such contracts in the market. Such contracts shall have been approved by the
ERB as of December 31, 2000.
[6]
Rule 4 (ddd) of the IRR provides that Missionary Electrification refers to the provision of basic electricity
service in Unviable Areas with the ultimate aim of bringing the operations in these areas to viability levels.
[7]
Manila Electric Company, Inc. v. Lualhati, G.R. Nos. 166769 and 166818, December 6, 2006.
[8]
IRR, Rule 4 (bbbb) states that Small Power Utilities Group or SPUG refers to the functional unit of NPC
created to pursue Missionary Electrification function.
[9]
ERC Record for ERC Case No. 2002-165, pp. 1-7.
[10]
PSALM is a government-owned and controlled corporation created under Sec. 49 of the EPIRA, which
shall take ownership of all existing NPC generation assets, liabilities, IPP contracts, real estate and all other
disposable assets. All outstanding obligations of the NPC arising from loans, issuances of bonds, securities
and other instruments of indebtedness shall be transferred to and assumed by the PSALM.
[11]
ERC Record for ERC Case No. 2002-194, pp. 1-5.
[12]
Supra note 9, at 110-122.
[13]
Id. at 215-224.
[14]
NPC-SPUG's Motion for Reconsideration dated August 13, 2003 also prayed that it be allowed (1) to
have flexibility in the utilization of UC-ME considering its mandate to implement the MEDP responsive to
the needs and constraints of missionary electrification; (2) to authorize it to re-prioritize its CAPEX and its
OPEX to the extent possible, for CY 2003; and (3) to give it the flexibility to reallocate available UC-ME
funds among the revised priority activities/projects for CY 2003, Id. at 225-236.
[15]
Id. at 237-239.
[16]
[17]
Rollo, p. 8.
[18]
Supra note 3.
[19]
Osmea v. Orbos, G.R. No. 99886, March 31, 1993, 220 SCRA 703; Valmonte v. Energy Regulatory
Board, G.R. Nos. L-79601-03, June 23, 1988, 162 SCRA 521; and Gaston v. Republic Planters Bank, No.
L-77194, March 15, 1988, 158 SCRA 626.
[20]
These funds are the Oil Price Stabilization Fund (OPSF) and Sugar Stabilization Fund (SSF).
[21]
Petitioners' Memorandum dated October 6, 2004; rollo, pp. 123-138.
[22]
PSALM's Memorandum dated December 8, 2004; id. at 154-167.
[23]
OSG's Memorandum dated January 4, 2005; id. at 168-187.
[24]
SECTION 46. Fines and Penalties. The fines and penalties that shall be imposed by the ERC for any
violation of or non-compliance with this Act or the IRR shall range from a minimum of Fifty thousand
pesos (P50,000.00) to a maximum of Fifty million pesos (P50,000,000.00).
Any person who is found guilty of any of the prohibited acts pursuant to Section 45 hereof shall suffer the
penalty of prision mayor and a fine ranging from Ten thousand pesos (P10,000.00) to Ten million pesos
(P10,000.000.00), or both, at the discretion of the court.
The members of the Board of Directors of the juridical companies participating in or covered in the
generation companies, the distribution utilities, the TRANSCO or its concessionaire or supplier who violate
the provisions of this Act may be fined by an amount not exceeding double the amount of damages caused
by the offender or by imprisonment of one (1) year or two (2) years or both at the discretion of the court.
This rule shall apply to the members of the Board who knowingly or by neglect allows the commission or
omission under the law.
If the offender is a government official or employee, he shall, in addition, be dismissed from the government
service with prejudice to reinstatement and with perpetual or temporary disqualification from holding any
elective or appointive office.
If the offender is an alien, he may, in addition to the penalties prescribed, be deported without further
proceedings after service of sentence.
Any case which involves question of fact shall be appealable to the Court of Appeals and those which
involve question of law shall be directly appealable to the Supreme Court.
The administrative sanction that may be imposed by the ERC shall be without prejudice to the filing of a
criminal action, if warranted.
To ensure compliance with this Act, the penalty of prision correccional or a fine ranging from Five thousand
pesos (P5,000.00) to Five million pesos (P5,000,000.00), or both, at the discretion of the court, shall be
imposed on any person, including but not limited to the president, member of the Board, Chief Executive
Officer or Chief Operating Officer of the corporation, partnership, or any other entity involved, found guilty
of violating or refusing to comply with any provision of this Act or its IRR, other than those provided
herein.
Any party to an administrative proceeding may, at any time, make an offer to the ERC, conditionally or
otherwise, for a consented decree, voluntary compliance or desistance and other settlement of the case. The
offer and any or all of the ultimate facts upon which the offer is based shall be considered for settlement
purposes only and shall not be used as evidence against any party for any other purpose and shall not
constitute an admission by the party making the offer of any violation of the laws, rules, regulations, orders
and resolutions of the ERC, nor as a waiver to file any warranted criminal actions.
In addition, Congress may, upon recommendation of the DOE and/or ERC, revoke such franchise or
privilege granted to the party who violated the provisions of this Act.
[25]
PECO's Memorandum dated April 18, 2005; rollo, pp. 205-210.
[26]
Supra note 21, at 125.
[27]
Emphasis supplied.
[28]
Francisco, Jr. v. Fernando, G.R. No. 166501, November 16, 2006, citing People v. Cuaresma, 172
SCRA 415, 423-424 (1989).
[29]
Lacson Hermanas, Inc. v. Heirs of Cenon Ignacio, G.R. No. 165973, June 29, 2005, 462 SCRA 290,
294 and Santiago v. Vasquez, G.R. Nos. 99289-90, January 27, 1993, 217 SCRA 633, 652.
[30]
Mactan Cebu International Airport Authority v. Marcos, 330 Phil. 392, 404 (1996).
[31]
Proton Pilipinas Corporation v. Republic of the Philippines, G.R. No. 165027, October 16, 2006,
citing Province of Tarlac v. Alcantara, 216 SCRA 790, 798 (1992).
[32]
National Power Corporation v. City of Cabanatuan, 449 Phil. 233, 248 (2003).
[33]
Didipio Earth-Savers' Multi-Purpose Association, Inc. (DESAMA) v. Gozun, G.R. No. 157882, March
30, 2006, 485 SCRA 586, 604, citing U.S. v. Torribio, 15 Phil. 85, 93 (1910) and Rubi v. The Provincial
Board of Mindoro, 39 Phil. 660, 708 (1919).
[34]
JMM Promotion and Management, Inc. v. Court of Appeals, G.R. No. 120095, August 5, 1996, 260
SCRA 319, 324.
[35]
Philippine Association of Service Exporters, Inc. v. Hon. Ruben D. Torres, G.R. No. 101279, August 6,
1992, 212 SCRA 298, 304, citing Philippine Communications Satellite Corporation v. Alcuaz, 180 SCRA
218 (1989).
[36]
Progressive Development Corporation vs. Quezon City, G.R. No. 36081, April 24, 1989, 172 SCRA
629, 635, citing Manila Electric Company v. El Auditor General y La Comision de Servicios Publicos, 73
Phil. 133 (1941); Republic v. Philippine Rabbit Lines, 143 Phil. 158, 163 (1970).
[37]
The purposes are:
(a) Payment for the stranded debts in excess of the amount assumed by the National Government
and stranded contract costs of NPC and as well as qualified stranded contract costs of distribution utilities
resulting from the restructuring of the industry;
(b) Missionary electrification;
(c) The equalization of the taxes and royalties applied to indigenous or renewable sources of energy
vis--vis imported energy fuels;
(d) An environmental charge equivalent to one-fourth of one centavo per kilowatt-hour
(P0.0025/kWh), which shall accrue to an environmental fund to be used solely for watershed rehabilitation
and management. Said fund shall be managed by NPC under existing arrangements; and
(e) A charge to account for all forms of cross-subsidies for a period not exceeding three (3) years.
[38]
Osmea v. Orbos, supra note 19, at 710, Gaston v. Republic Planters Bank, supra note 19, at 632, Tio v.
Videogram Regulatory Board, No. L-75697, June 18, 1987, 151 SCRA 208, 216, and Lutz v. Araneta, 98
Phil. 148 (1955).
[39]
Supra note 19, at 539; Decided jointly with Citizen's Alliance for Consumer Protection v. Energy
Regulatory Board., G.R. Nos. L-78888-90, and Kilusang Mayo Uno Labor Center v. Energy Regulatory,
Board., G.R. Nos. L-79690-92.
[40]
[41]
Id. at 710-711.
[42]
Last paragraph, Sec. 34, EPIRA provides: The PSALM Corp., as administrator of the fund, shall create
a Special Trust Fund which shall be disbursed only for the purposes specified herein in an open and
transparent manner. All amount collected for the universal charge shall be distributed to the respective
beneficiaries within a reasonable period to be provided by the ERC.
IRR of the EPIRA, Rule 18, SECTION 6, also provides:
(a) Pursuant to the last paragraph of Section 34 of the Act, PSALM shall act as the administrator of the
funds generated from the Universal Charge. For this purpose, the PSALM shall create a STF to be
established in the Bureau of Treasury (BTr) or in a Government Financing Institution (GFI) that is
acceptable to the DOF. Separate STFs shall be established for each of the intended purposes of the Universal
Charge. Funds shall be disbursed in an open and transparent manner and shall only be used for the intended
purposes specified in Section 3 of this Rule.
[43]
EPIRA, Sec. 33, last paragraph and IRR, Sec. 5 (f), Rule 17.
[44]
IRR, Sec. 6 (f), Rule 18.
[45]
IRR, Sec. 4, Rule 21.
[46]
Supra note 23, at 177-178, citing Osmea v. Orbos, supra note 19.
[47]
Abakada Guro Party List v. Ermita, G.R. Nos. 168056, 168207, 168461, 168463 and 168730, September
1, 2005, 469 SCRA 10, 115-116.
[48]
The recognized exceptions to the general principle are as follows:
(1) Delegation of tariff powers to the President under Section 28(2) of Article VI of the Constitution;
(2) Delegation of emergency powers to the President under Section 23(2) of Article VI of the Constitution;
(3) Delegation to the people at large;
(4) Delegation to local governments; and
(5) Delegation to administrative bodies. Abakada Guro Party List v. Ermita, supra note 47, at 117
and Santiago v. Comelec, 336 Phil. 848, 897-898 (1997), citing People v. Vera, 65 Phil. 56 (1937).
[49]
Equi-Asia Placement, Inc. v. DFA, G.R. No. 152214, September 19, 2006, citing Beltran v. Secretary
of Health, 476 SCRA 168, 191 (2005); The Conference of Maritime Manning Agencies v. Philippine
Overseas Employment Agency, 313 Phil. 592, 606 (1995); and Eastern Shipping Lines, Inc. v. Philippine
Overseas Employment Agency, G.R. No. L-76633, October 18, 1998, 166 SCRA 533, 543.
[50]
Emphasis supplied.
[51]
Rubi v. Provincial Board of Mindoro, supra note 33, at 706.
[52]
Philippine Association of Colleges and University v. Secretary of Education, 97 Phil. 806, 814 (1955).
[53]
People v. Rosenthal, 68 Phil. 328, 342 (1939).
[54]
Antamok Gold Fields v. CIR, 70 Phil. 340 (1940).
[55]
Calalang v. Williams, 70 Phil. 726, 733 (1940).
[56]
Cervantes v. Auditor General, 91 Phil 359, 364 (1952).
[57]
Tablarin v. Gutierrez, No. L-78164, July 31, 1987, 152 SCRA 731.
[58]
The Conference of Maritime Manning Agencies, Inc. v. Philippine Overseas Employment
Administration, supra note 49.
[59]
Sec. 2(a) and (b), Declaration of Policies of the EPIRA.
[60]
Supra note 37.
[61]
G.R. No. 161113, June 15, 2004, 432 SCRA 157, 182.
[62]
Id. at 219-220 (Emphasis supplied).
[63]
G.R. No. 163935, February 2, 2006, 481 SCRA 480, 515-516, citing Freedom from Debt Coalition v.
Energy Regulatory Commission, supra note 61.
[64]
Rollo, pp. 108-109
[65]
Republic v. Kalaw, G.R. No. 155138, June 8, 2004, 431 SCRA 401, 406.
[66]
Lopez v. City of Manila, G.R. No. 127139, February 19, 1999, 303 SCRA 448, 460, citing Ty v.
Trampe, 250 SCRA 500 (1995).
[67]
Freedom from Debt Coalition v. Energy Regulatory Commission, supra note 61, at 171-172.
[68]
Arceta v. Mangrobang, G.R. Nos. 152895 & 153151, June 15, 2004, 432 SCRA 136, 142, citing Lacson
v. The Executive Secretary, 361 Phil. 251, 263 (1999).
EN BANC
ABAKADA GURO PARTY LIST (Formerly G.R. No. 168056

AASJAS) OFFICERS SAMSON S.
ALCANTARA and ED VINCENT S. ALBANO,
Petitioners, Present:
DAVIDE, JR., C.J.,

PUNO,
PANGANIBAN,
QUISUMBING,
YNARES-SANTIAGO,
SANDOVAL-GUTIERREZ,
- versus - CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
CARPIO-MORALES,
CALLEJO, SR.,
AZCUNA,
TINGA,
CHICO-NAZARIO, and
GARCIA, JJ.
THE HONORABLE EXECUTIVE
SECRETARY EDUARDO ERMITA;
HONORABLE SECRETARY OF THE
DEPARTMENT OF FINANCE CESAR
PURISIMA; and HONORABLE
COMMISSIONER OF INTERNAL REVENUE
GUILLERMO PARAYNO, JR.,
Respondents.
x-------------------------x
AQUILINO Q. PIMENTEL, JR., LUISA P. G.R. No. 168207

EJERCITO-ESTRADA, JINGGOY E.
ESTRADA, PANFILO M. LACSON, ALFREDO
S. LIM, JAMBY A.S. MADRIGAL, AND
SERGIO R. OSMEA III,
Petitioners,
- versus -
EXECUTIVE SECRETARY EDUARDO R.

ERMITA, CESAR V. PURISIMA,
SECRETARY OF FINANCE, GUILLERMO L.
PARAYNO, JR., COMMISSIONER OF THE
BUREAU OF INTERNAL REVENUE,
Respondents.
x-------------------------x
ASSOCIATION OF PILIPINAS SHELL G.R. No. 168461

DEALERS, INC. represented by its President,
ROSARIO ANTONIO; PETRON DEALERS
ASSOCIATION represented by its President,
RUTH E. BARBIBI; ASSOCIATION OF
CALTEX DEALERS OF THE PHILIPPINES
represented by its President, MERCEDITAS A.
GARCIA; ROSARIO ANTONIO doing business
under the name and style of ANB NORTH
SHELL SERVICE STATION; LOURDES
MARTINEZ doing business under the name and
style of SHELL GATE N. DOMINGO;
BETHZAIDA TAN doing business under the
name and style of ADVANCE SHELL
STATION; REYNALDO P. MONTOYA doing
business under the name and style of NEW
LAMUAN SHELL SERVICE STATION;
EFREN SOTTO doing business under the name
and style of RED FIELD SHELL SERVICE
STATION; DONICA CORPORATION
represented by its President, DESI
TOMACRUZ; RUTH E. MARBIBI doing
business under the name and style of R&R
PETRON STATION; PETER M. UNGSON
doing business under the name and style of
CLASSIC STAR GASOLINE SERVICE
STATION; MARIAN SHEILA A. LEE doing
business under the name and style of NTE
GASOLINE & SERVICE STATION; JULIAN
CESAR P. POSADAS doing business under the
name and style of STARCARGA
ENTERPRISES; ADORACION MAEBO doing
business under the name and style of CMA
MOTORISTS CENTER; SUSAN M. ENTRATA
doing business under the name and style of
LEONAS GASOLINE STATION and SERVICE
CENTER; CARMELITA BALDONADO doing
business under the name and style of FIRST
CHOICE SERVICE CENTER; MERCEDITAS
A. GARCIA doing business under the name and
style of LORPED SERVICE CENTER;
RHEAMAR A. RAMOS doing business under
the name and style of RJRAM PTT GAS
STATION; MA. ISABEL VIOLAGO doing
business under the name and style of VIOLAGO-
PTT SERVICE CENTER; MOTORISTS
HEART CORPORATION represented by its
Vice-President for Operations, JOSELITO F.
FLORDELIZA; MOTORISTS HARVARD
CORPORATION represented by its Vice-
President for Operations, JOSELITO F.
FLORDELIZA; MOTORISTS HERITAGE
FLORDELIZA; PHILIPPINE STANDARD OIL
FLORDELIZA; ROMEO MANUEL doing
business under the name and style of ROMMAN
GASOLINE STATION; ANTHONY ALBERT
CRUZ III doing business under the name and
style of TRUE SERVICE STATION,
Petitioners,
- versus -
CESAR V. PURISIMA, in his capacity as

Secretary of the Department of Finance and
GUILLERMO L. PARAYNO, JR., in his
capacity as Commissioner of Internal Revenue,
Respondents.
x-------------------------x
FRANCIS JOSEPH G. ESCUDERO, VINCENT G.R. No. 168463

CRISOLOGO, EMMANUEL JOEL J.
VILLANUEVA, RODOLFO G. PLAZA,
DARLENE ANTONINO-CUSTODIO, OSCAR
G. MALAPITAN, BENJAMIN C. AGARAO,
JR. JUAN EDGARDO M. ANGARA, JUSTIN
MARC SB. CHIPECO, FLORENCIO G. NOEL,
MUJIV S. HATAMAN, RENATO B.
MAGTUBO, JOSEPH A. SANTIAGO,
TEOFISTO DL. GUINGONA III, RUY ELIAS
C. LOPEZ, RODOLFO Q. AGBAYANI and
TEODORO A. CASIO,
Petitioners,
- versus -
CESAR V. PURISIMA, in his capacity as
Secretary of Finance, GUILLERMO L.
PARAYNO, JR., in his capacity as Commissioner
of Internal Revenue, and EDUARDO R.
ERMITA, in his capacity as Executive Secretary,
Respondents.
x-------------------------x
BATAAN GOVERNOR ENRIQUE T. G.R. No. 168730

GARCIA, JR.
Petitioner,
- versus -
HON. EDUARDO R. ERMITA, in his capacity as

the Executive Secretary; HON. MARGARITO
TEVES, in his capacity as Secretary of Finance;
HON. JOSE MARIO BUNAG, in his capacity as
the OIC Commissioner of the Bureau of Internal
Revenue; and HON. ALEXANDER AREVALO,
in his capacity as the OIC Commissioner of the
Bureau of Customs,
Promulgated:
Respondents. September 1, 2005
x-----------------------------------------------------------x
DECISION
AUSTRIA-MARTINEZ, J.:
The expenses of government, having for their object the interest of all, should be
borne by everyone, and the more man enjoys the advantages of society, the more he ought
to hold himself honored in contributing to those expenses.
-Anne Robert Jacques Turgot (1727-1781)
French statesman and economist
Mounting budget deficit, revenue generation, inadequate fiscal allocation for education, increased
emoluments for health workers, and wider coverage for full value-added tax benefits these are the reasons
why Republic Act No. 9337 (R.A. No. 9337)[1] was enacted. Reasons, the wisdom of which, the Court even
with its extensive constitutional power of review, cannot probe. The petitioners in these cases, however,
question not only the wisdom of the law, but also perceived constitutional infirmities in its passage.
Every law enjoys in its favor the presumption of constitutionality. Their arguments
notwithstanding, petitioners failed to justify their call for the invalidity of the law. Hence, R.A. No. 9337 is
not unconstitutional.
LEGISLATIVE HISTORY
R.A. No. 9337 is a consolidation of three legislative bills namely, House Bill Nos. 3555 and 3705,
and Senate Bill No. 1950.
House Bill No. 3555[2] was introduced on first reading on January 7, 2005. The House Committee
on Ways and Means approved the bill, in substitution of House Bill No. 1468, which Representative (Rep.)
Eric D. Singson introduced on August 8, 2004. The President certified the bill on January 7, 2005 for
immediate enactment. On January 27, 2005, the House of Representatives approved the bill on second and
third reading.
House Bill No. 3705[3] on the other hand, substituted House Bill No. 3105 introduced by Rep.
Salacnib F. Baterina, and House Bill No. 3381 introduced by Rep. Jacinto V. Paras. Its mother bill is House
Bill No. 3555. The House Committee on Ways and Means approved the bill on February 2, 2005. The
President also certified it as urgent on February 8, 2005. The House of Representatives approved the bill
on second and third reading on February 28, 2005.
Meanwhile, the Senate Committee on Ways and Means approved Senate Bill No. 1950[4] on March
7, 2005, in substitution of Senate Bill Nos. 1337, 1838 and 1873, taking into consideration House Bill Nos.
3555 and 3705. Senator Ralph G. Recto sponsored Senate Bill No. 1337, while Senate Bill Nos. 1838 and
1873 were both sponsored by Sens. Franklin M. Drilon, Juan M. Flavier and Francis N. Pangilinan. The
President certified the bill on March 11, 2005, and was approved by the Senate on second and third reading
on April 13, 2005.
On the same date, April 13, 2005, the Senate agreed to the request of the House of Representatives
for a committee conference on the disagreeing provisions of the proposed bills.
Before long, the Conference Committee on the Disagreeing Provisions of House Bill No. 3555,
House Bill No. 3705, and Senate Bill No. 1950, after having met and discussed in full free and conference,
recommended the approval of its report, which the Senate did on May 10, 2005, and with the House of
Representatives agreeing thereto the next day, May 11, 2005.
On May 23, 2005, the enrolled copy of the consolidated House and Senate version was transmitted
to the President, who signed the same into law on May 24, 2005. Thus, came R.A. No. 9337.
July 1, 2005 is the effectivity date of R.A. No. 9337.[5] When said date came, the Court issued a
temporary restraining order, effective immediately and continuing until further orders, enjoining
respondents from enforcing and implementing the law.
Oral arguments were held on July 14, 2005. Significantly, during the hearing, the Court speaking
through Mr. Justice Artemio V. Panganiban, voiced the rationale for its issuance of the temporary
restraining order on July 1, 2005, to wit:
J. PANGANIBAN : . . . But before I go into the details of your presentation, let me just tell
you a little background. You know when the law took effect
on July 1, 2005, the Court issued a TRO at about 5 oclock in the
afternoon. But before that, there was a lot of complaints aired on
television and on radio. Some people in a gas station were
complaining that the gas prices went up by 10%. Some people
were complaining that their electric bill will go up by 10%. Other
times people riding in domestic air carrier were complaining that
the prices that theyll have to pay would have to go up by 10%.
While all that was being aired, per your presentation and per our
own understanding of the law, thats not true. Its not true that the
e-vat law necessarily increased prices by 10% uniformly isnt it?
ATTY. BANIQUED : No, Your Honor.
J. PANGANIBAN : It is not?
ATTY. BANIQUED : Its not, because, Your Honor, there is an Executive Order that
granted the Petroleum companies some subsidy . . . interrupted
J. PANGANIBAN : Thats correct . . .
ATTY. BANIQUED : . . . and therefore that was meant to temper the impact . . . interrupted
J. PANGANIBAN : . . . mitigating measures . . .
ATTY. BANIQUED : Yes, Your Honor.
J. PANGANIBAN : As a matter of fact a part of the mitigating measures would be the

elimination of the Excise Tax and the import duties. That is why,
it is not correct to say that the VAT as to petroleum dealers
increased prices by 10%.
J. PANGANIBAN : And therefore, there is no justification for increasing the retail price
by 10% to cover the E-Vat tax. If you consider the excise tax and
the import duties, the Net Tax would probably be in the
neighborhood of 7%? We are not going into exact figures I am just
trying to deliver a point that different industries, different
products, different services are hit differently. So its not correct to
say that all prices must go up by 10%.
ATTY. BANIQUED : Youre right, Your Honor.
J. PANGANIBAN : Now. For instance, Domestic Airline companies, Mr. Counsel, are at
present imposed a Sales Tax of 3%. When this E-Vat law took
effect the Sales Tax was also removed as a mitigating measure.
So, therefore, there is no justification to increase the fares by 10%
at best 7%, correct?
ATTY. BANIQUED : I guess so, Your Honor, yes.
J. PANGANIBAN : There are other products that the people were complaining on that first
day, were being increased arbitrarily by 10%. And thats one
reason among many others this Court had to issue TRO because
of the confusion in the implementation. Thats why we added as an
issue in this case, even if its tangentially taken up by the pleadings
of the parties, the confusion in the implementation of the E-vat.
Our people were subjected to the mercy of that confusion of an
across the board increase of 10%, which you yourself now admit
and I think even the Government will admit is incorrect. In some
cases, it should be 3% only, in some cases it should be 6%
depending on these mitigating measures and the location and
situation of each product, of each service, of each company, isnt
it?

J. PANGANIBAN : Alright. So thats one reason why we had to issue a TRO pending the
clarification of all these and we wish the government will take
time to clarify all these by means of a more detailed implementing
rules, in case the law is upheld by this Court. . . .[6]
The Court also directed the parties to file their respective Memoranda.
G.R. No. 168056
Before R.A. No. 9337 took effect, petitioners ABAKADA GURO Party List, et al., filed a petition
for prohibition on May 27, 2005. They question the constitutionality of Sections 4, 5 and 6 of R.A. No.
9337, amending Sections 106, 107 and 108, respectively, of the National Internal Revenue Code (NIRC).
Section 4 imposes a 10% VAT on sale of goods and properties, Section 5 imposes a 10% VAT on
importation of goods, and Section 6 imposes a 10% VAT on sale of services and use or lease of properties.
These questioned provisions contain a uniform proviso authorizing the President, upon recommendation of
the Secretary of Finance, to raise the VAT rate to 12%, effective January 1, 2006, after any of the following
conditions have been satisfied, to wit:
. . . That the President, upon the recommendation of the Secretary of Finance, shall,
effective January 1, 2006, raise the rate of value-added tax to twelve percent (12%), after
any of the following conditions has been satisfied:
(i) Value-added tax collection as a percentage of Gross Domestic Product (GDP)

of the previous year exceeds two and four-fifth percent (2 4/5%); or
(ii) National government deficit as a percentage of GDP of the previous year

exceeds one and one-half percent (1 %).
Petitioners argue that the law is unconstitutional, as it constitutes abandonment by Congress of its
exclusive authority to fix the rate of taxes under Article VI, Section 28(2) of the 1987 Philippine
Constitution.
G.R. No. 168207
On June 9, 2005, Sen. Aquilino Q. Pimentel, Jr., et al., filed a petition for certiorari likewise
assailing the constitutionality of Sections 4, 5 and 6 of R.A. No. 9337.
Aside from questioning the so-called stand-by authority of the President to increase the VAT rate
to 12%, on the ground that it amounts to an undue delegation of legislative power, petitioners also contend
that the increase in the VAT rate to 12% contingent on any of the two conditions being satisfied violates
the due process clause embodied in Article III, Section 1 of the Constitution, as it imposes an unfair and
additional tax burden on the people, in that: (1) the 12% increase is ambiguous because it does not state if
the rate would be returned to the original 10% if the conditions are no longer satisfied; (2) the rate is unfair
and unreasonable, as the people are unsure of the applicable VAT rate from year to year; and (3) the increase
in the VAT rate, which is supposed to be an incentive to the President to raise the VAT collection to at least
2 4/5 of the GDP of the previous year, should only be based on fiscal adequacy.
Petitioners further claim that the inclusion of a stand-by authority granted to the President by the
Bicameral Conference Committee is a violation of the no-amendment rule upon last reading of a bill laid
down in Article VI, Section 26(2) of the Constitution.
G.R. No. 168461
Thereafter, a petition for prohibition was filed on June 29, 2005, by the Association
of Pilipinas Shell Dealers, Inc., et al., assailing the following provisions of R.A. No. 9337:
1) Section 8, amending Section 110 (A)(2) of the NIRC, requiring that the input tax on
depreciable goods shall be amortized over a 60-month period, if the acquisition,
excluding the VAT components, exceeds One Million Pesos (P1, 000,000.00);
2) Section 8, amending Section 110 (B) of the NIRC, imposing a 70% limit on the amount
of input tax to be credited against the output tax; and
3) Section 12, amending Section 114 (c) of the NIRC, authorizing the Government or any
of its political subdivisions, instrumentalities or agencies, including GOCCs, to
deduct a 5% final withholding tax on gross payments of goods and services, which
are subject to 10% VAT under Sections 106 (sale of goods and properties) and 108
(sale of services and use or lease of properties) of the NIRC.
Petitioners contend that these provisions are unconstitutional for being arbitrary, oppressive,
excessive, and confiscatory.
Petitioners argument is premised on the constitutional right of non-deprivation of life, liberty or

property without due process of law under Article III, Section 1 of the Constitution. According to
petitioners, the contested sections impose limitations on the amount of input tax that may be claimed.
Petitioners also argue that the input tax partakes the nature of a property that may not be confiscated,
appropriated, or limited without due process of law. Petitioners further contend that like any other property
or property right, the input tax credit may be transferred or disposed of, and that by limiting the same, the
government gets to tax a profit or value-added even if there is no profit or value-added.
Petitioners also believe that these provisions violate the constitutional guarantee of equal protection
of the law under Article III, Section 1 of the Constitution, as the limitation on the creditable input tax if: (1)
the entity has a high ratio of input tax; or (2) invests in capital equipment; or (3) has several transactions
with the government, is not based on real and substantial differences to meet a valid classification.
Lastly, petitioners contend that the 70% limit is anything but progressive, violative of Article VI,
Section 28(1) of the Constitution, and that it is the smaller businesses with higher input tax to output tax
ratio that will suffer the consequences thereof for it wipes out whatever meager margins the petitioners
make.
G.R. No. 168463
Several members of the House of Representatives led by Rep. Francis Joseph G. Escudero filed
this petition for certiorari on June 30, 2005. They question the constitutionality of R.A. No. 9337 on the
following grounds:
1) Sections 4, 5, and 6 of R.A. No. 9337 constitute an undue delegation of legislative power,
in violation of Article VI, Section 28(2) of the Constitution;
2) The Bicameral Conference Committee acted without jurisdiction in deleting the no pass
on provisions present in Senate Bill No. 1950 and House Bill No. 3705; and
3) Insertion by the Bicameral Conference Committee of Sections 27, 28, 34, 116, 117, 119,
121, 125,[7] 148, 151, 236, 237 and 288, which were present in Senate Bill No.
1950, violates Article VI, Section 24(1) of the Constitution, which provides that
all appropriation, revenue or tariff bills shall originate exclusively in the House of
Representatives
G.R. No. 168730
On the eleventh hour, Governor Enrique T. Garcia filed a petition for certiorari and prohibition on
July 20, 2005, alleging unconstitutionality of the law on the ground that the limitation on the creditable
input tax in effect allows VAT-registered establishments to retain a portion of the taxes they collect, thus
violating the principle that tax collection and revenue should be solely allocated for public purposes and
expenditures. Petitioner Garcia further claims that allowing these establishments to pass on the tax to the
consumers is inequitable, in violation of Article VI, Section 28(1) of the Constitution.
RESPONDENTS COMMENT
The Office of the Solicitor General (OSG) filed a Comment in behalf of respondents. Preliminarily,
respondents contend that R.A. No. 9337 enjoys the presumption of constitutionality and petitioners failed
to cast doubt on its validity.
Relying on the case of Tolentino vs. Secretary of Finance, 235 SCRA
630 (1994), respondents argue that the procedural issues raised by petitioners, i.e., legality of the bicameral
proceedings, exclusive origination of revenue measures and the power of the Senate concomitant thereto,
have already been settled. With regard to the issue of undue delegation of legislative power to the President,
respondents contend that the law is complete and leaves no discretion to the President but to increase the
rate to 12% once any of the two conditions provided therein arise.
Respondents also refute petitioners argument that the increase to 12%, as well as the 70% limitation
on the creditable input tax, the 60-month amortization on the purchase or importation of capital goods
exceeding P1,000,000.00, and the 5% final withholding tax by government agencies, is arbitrary,
oppressive, and confiscatory, and that it violates the constitutional principle on progressive taxation, among
others.
Finally, respondents manifest that R.A. No. 9337 is the anchor of the governments fiscal reform
agenda. A reform in the value-added system of taxation is the core revenue measure that will tilt the balance
towards a sustainable macroeconomic environment necessary for economic growth.
ISSUES
The Court defined the issues, as follows:
PROCEDURAL ISSUE
Whether R.A. No. 9337 violates the following provisions of the Constitution:
a. Article VI, Section 24, and

b. Article VI, Section 26(2)
SUBSTANTIVE ISSUES
1. Whether Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106, 107 and 108 of
the NIRC, violate the following provisions of the Constitution:
a. Article VI, Section 28(1), and

2. Whether Section 8 of R.A. No. 9337, amending Sections 110(A)(2) and 110(B) of the
NIRC; and Section 12 of R.A. No. 9337, amending Section 114(C) of the NIRC, violate
the following provisions of the Constitution:

b. Article III, Section 1
RULING OF THE COURT
As a prelude, the Court deems it apt to restate the general principles and concepts of value-added
tax (VAT), as the confusion and inevitably, litigation, breeds from a fallacious notion of its nature.
The VAT is a tax on spending or consumption. It is levied on the sale, barter, exchange or lease of
goods or properties and services.[8] Being an indirect tax on expenditure, the seller of goods or services may
pass on the amount of tax paid to the buyer,[9] with the seller acting merely as a tax collector.[10] The burden
of VAT is intended to fall on the immediate buyers and ultimately, the end-consumers.
In contrast, a direct tax is a tax for which a taxpayer is directly liable on the transaction or business
it engages in, without transferring the burden to someone else.[11]Examples are individual and corporate
income taxes, transfer taxes, and residence taxes.[12]
In the Philippines, the value-added system of sales taxation has long been in existence, albeit in a
different mode. Prior to 1978, the system was a single-stage tax computed under the cost deduction method
and was payable only by the original sellers. The single-stage system was subsequently modified, and a
mixture of the cost deduction method and tax credit method was used to determine the value-added tax
payable.[13] Under the tax credit method, an entity can credit against or subtract from the VAT charged on
its sales or outputs the VAT paid on its purchases, inputs and imports.[14]
It was only in 1987, when President Corazon C. Aquino issued Executive Order No. 273, that the
VAT system was rationalized by imposing a multi-stage tax rate of 0% or 10% on all sales using the tax
credit method.[15]
E.O. No. 273 was followed by R.A. No. 7716 or the Expanded VAT Law,[16] R.A. No. 8241 or the
Improved VAT Law,[17] R.A. No. 8424 or the Tax Reform Act of 1997,[18] and finally, the presently
beleaguered R.A. No. 9337, also referred to by respondents as the VAT Reform Act.
The Court will now discuss the issues in logical sequence.
PROCEDURAL ISSUE
I.
Whether R.A. No. 9337 violates the following provisions of the Constitution:
a. Article VI, Section 24, and

A. The Bicameral Conference Committee
Petitioners Escudero, et al., and Pimentel, et al., allege that the Bicameral Conference Committee
exceeded its authority by:
1) Inserting the stand-by authority in favor of the President in Sections 4, 5, and 6 of R.A.
No. 9337;
2) Deleting entirely the no pass-on provisions found in both the House and Senate bills;
3) Inserting the provision imposing a 70% limit on the amount of input tax to be credited
against the output tax; and
4) Including the amendments introduced only by Senate Bill No. 1950 regarding other
kinds of taxes in addition to the value-added tax.
Petitioners now beseech the Court to define the powers of the Bicameral Conference Committee.
It should be borne in mind that the power of internal regulation and discipline are intrinsic in any
legislative body for, as unerringly elucidated by Justice Story, [i]f the power did not exist, it would be
utterly impracticable to transact the business of the nation, either at all, or at least with decency,
deliberation, and order.[19] Thus, Article VI, Section 16 (3) of the Constitution provides that each House
may determine the rules of its proceedings. Pursuant to this inherent constitutional power to promulgate
and implement its own rules of procedure, the respective rules of each house of Congress provided for the
creation of a Bicameral Conference Committee.
Thus, Rule XIV, Sections 88 and 89 of the Rules of House of Representatives provides as follows:
Sec. 88. Conference Committee. In the event that the House does not agree with
the Senate on the amendment to any bill or joint resolution, the differences may be settled
by the conference committees of both chambers.
In resolving the differences with the Senate, the House panel shall, as much as
possible, adhere to and support the House Bill. If the differences with the Senate are so
substantial that they materially impair the House Bill, the panel shall report such fact to the
House for the latters appropriate action.
Sec. 89. Conference Committee Reports. . . . Each report shall contain a detailed,
sufficiently explicit statement of the changes in or amendments to the subject measure.
...
The Chairman of the House panel may be interpellated on the Conference

Committee Report prior to the voting thereon. The House shall vote on the Conference
Committee Report in the same manner and procedure as it votes on a bill on third and final
reading.
Rule XII, Section 35 of the Rules of the Senate states:

Sec. 35. In the event that the Senate does not agree with the House of
Representatives on the provision of any bill or joint resolution, the differences shall be
settled by a conference committee of both Houses which shall meet within ten (10) days
after their composition. The President shall designate the members of the Senate Panel in
the conference committee with the approval of the Senate.
Each Conference Committee Report shall contain a detailed and sufficiently

explicit statement of the changes in, or amendments to the subject measure, and shall be
signed by a majority of the members of each House panel, voting separately.
A comparative presentation of the conflicting House and Senate provisions and a

reconciled version thereof with the explanatory statement of the conference committee
shall be attached to the report.
The creation of such conference committee was apparently in response to a problem, not addressed
by any constitutional provision, where the two houses of Congress find themselves in disagreement over
changes or amendments introduced by the other house in a legislative bill. Given that one of the most basic
powers of the legislative branch is to formulate and implement its own rules of proceedings and to discipline
its members, may the Court then delve into the details of how Congress complies with its internal rules or
how it conducts its business of passing legislation? Note that in the present petitions, the issue is not whether
provisions of the rules of both houses creating the bicameral conference committee are unconstitutional, but
whether the bicameral conference committee has strictly complied with the rules of both houses,
thereby remaining within the jurisdiction conferred upon it by Congress.
In the recent case of Farias vs. The Executive Secretary,[20] the Court En
Banc, unanimously reiterated and emphasized its adherence to the enrolled bill doctrine, thus, declining
therein petitioners plea for the Court to go behind the enrolled copy of the bill. Assailed in said case was
Congresss creation of two sets of bicameral conference committees, the lack of records of said committees
proceedings, the alleged violation of said committees of the rules of both houses, and the disappearance or
deletion of one of the provisions in the compromise bill submitted by the bicameral conference committee.
It was argued that such irregularities in the passage of the law nullified R.A. No. 9006, or the Fair Election
Act.
Striking down such argument, the Court held thus:
Under the enrolled bill doctrine, the signing of a bill by the Speaker of the House
and the Senate President and the certification of the Secretaries of both Houses of Congress
that it was passed are conclusive of its due enactment. A review of cases reveals the Courts
consistent adherence to the rule. The Court finds no reason to deviate from the salutary
rule in this case where the irregularities alleged by the petitioners mostly involved the
internal rules of Congress, e.g., creation of the 2nd or 3rd Bicameral Conference
Committee by the House. This Court is not the proper forum for the enforcement of
these internal rules of Congress, whether House or Senate. Parliamentary rules are
merely procedural and with their observance the courts have no concern. Whatever
doubts there may be as to the formal validity of Rep. Act No. 9006 must be resolved
in its favor. The Court reiterates its ruling in Arroyo vs. De Venecia, viz.:
But the cases, both here and abroad, in varying forms of

expression, all deny to the courts the power to inquire into allegations
that, in enacting a law, a House of Congress failed to comply with its
own rules, in the absence of showing that there was a violation of a
constitutional provision or the rights of private individuals. In Osmea
v. Pendatun, it was held: At any rate, courts have declared that the rules
adopted by deliberative bodies are subject to revocation, modification or
waiver at the pleasure of the body adopting them. And it has been said
that Parliamentary rules are merely procedural, and with their
observance, the courts have no concern. They may be waived or
disregarded by the legislative body. Consequently, mere failure to
conform to parliamentary usage will not invalidate the action (taken
by a deliberative body) when the requisite number of members have
agreed to a particular measure.[21] (Emphasis supplied)
The foregoing declaration is exactly in point with the present cases, where petitioners allege
irregularities committed by the conference committee in introducing changes or deleting provisions in the
House and Senate bills. Akin to the Farias case,[22] the present petitions also raise an issue regarding the
actions taken by the conference committee on matters regarding Congress compliance with its own internal
rules. As stated earlier, one of the most basic and inherent power of the legislature is the power to formulate
rules for its proceedings and the discipline of its members. Congress is the best judge of how it should
conduct its own business expeditiously and in the most orderly manner. It is also the sole
concern of Congress to instill discipline among the members of its conference committee if it believes that
said members violated any of its rules of proceedings. Even the expanded jurisdiction of this Court cannot
apply to questions regarding only the internal operation of Congress, thus, the Court is wont to deny a
review of the internal proceedings of a co-equal branch of government.
Moreover, as far back as 1994 or more than ten years ago, in the case of Tolentino vs. Secretary of
Finance,[23] the Court already made the pronouncement that [i]f a change is desired in the practice [of the
Bicameral Conference Committee] it must be sought in Congress since this question is not covered
by any constitutional provision but is only an internal rule of each house. [24] To date, Congress has not
seen it fit to make such changes adverted to by the Court. It seems, therefore, that Congress finds the
practices of the bicameral conference committee to be very useful for purposes of prompt and efficient
legislative action.
Nevertheless, just to put minds at ease that no blatant irregularities tainted the proceedings of the
bicameral conference committees, the Court deems it necessary to dwell on the issue. The Court observes
that there was a necessity for a conference committee because a comparison of the provisions of House Bill
Nos. 3555 and 3705 on one hand, and Senate Bill No. 1950 on the other, reveals that there were indeed
disagreements. As pointed out in the petitions, said disagreements were as follows:
House Bill No. 3555

House Bill No.3705 Senate Bill No. 1950
With regard to Stand-By Authority in favor of President
Provides for 12% VAT on Provides for 12% VAT in Provides for a single rate of 10%
every sale of goods or general on sales of goods or VAT on sale of goods or
properties (amending Sec. properties and reduced rates for properties (amending Sec. 106 of
106 of NIRC); 12% VAT sale of certain locally NIRC), 10% VAT on sale of
on importation of goods manufactured goods and services including sale of
(amending Sec. 107 of petroleum products and raw electricity by generation
NIRC); and 12% VAT on materials to be used in the companies, transmission and
sale of services and use or manufacture thereof (amending distribution companies, and use
lease of properties Sec. 106 of NIRC); 12% VAT or lease of properties (amending
(amending Sec. 108 of on importation of goods and Sec. 108 of NIRC)
NIRC) reduced rates for certain
imported products including
petroleum products (amending
Sec. 107 of NIRC); and 12%
VAT on sale of services and use
or lease of properties and a
reduced rate for certain services
including power generation
(amending Sec. 108 of NIRC)
With regard to the no pass-on provision
No similar provision Provides that the VAT imposed Provides that the VAT imposed
on power generation and on the on sales of electricity by
sale of petroleum products shall generation companies and
be absorbed by generation services of transmission
companies or sellers, companies and distribution
respectively, and shall not be companies, as well as those of
passed on to consumers franchise grantees of electric
utilities shall not apply to
residential
end-users. VAT shall be
absorbed by generation,
transmission, and distribution
companies.
With regard to 70% limit on input tax credit
Provides that the input tax No similar provision Provides that the input tax credit
credit for capital goods on for capital goods on which a
which a VAT has been paid VAT has been paid shall be
shall be equally distributed equally distributed over 5 years
over 5 years or the or the depreciable life of such
depreciable life of such capital goods; the input tax credit
capital goods; the input tax for goods and services other than
credit for goods and capital goods shall not exceed
services other than capital 90% of the output VAT.
goods shall not exceed 5%
of the total amount of such
goods and services; and for
persons engaged in retail
trading of goods, the
allowable input tax credit
shall not exceed 11% of the
total amount of goods
purchased.
With regard to amendments to be made to NIRC provisions regarding income and excise taxes
No similar provision No similar provision Provided for amendments to

several NIRC provisions
regarding corporate income,
percentage, franchise and excise
taxes
The disagreements between the provisions in the House bills and the Senate bill were with regard
to (1) what rate of VAT is to be imposed; (2) whether only the VAT imposed on electricity generation,
transmission and distribution companies should not be passed on to consumers, as proposed in the Senate
bill, or both the VAT imposed on electricity generation, transmission and distribution companies and the
VAT imposed on sale of petroleum products should not be passed on to consumers, as proposed in the
House bill; (3) in what manner input tax credits should be limited; (4) and whether the NIRC provisions on
corporate income taxes, percentage, franchise and excise taxes should be amended.
There being differences and/or disagreements on the foregoing provisions of the House and Senate
bills, the Bicameral Conference Committee was mandated by the rules of both houses of Congress to act
on the same by settling said differences and/or disagreements. The Bicameral Conference Committee acted
on the disagreeing provisions by making the following changes:
1. With regard to the disagreement on the rate of VAT to be imposed, it would appear from the
Conference Committee Report that the Bicameral Conference Committee tried to bridge the gap in the
difference between the 10% VAT rate proposed by the Senate, and the various rates with 12% as the
highest VAT rate proposed by the House, by striking a compromise whereby the present 10% VAT rate
would be retained until certain conditions arise, i.e., the value-added tax collection as a percentage of
gross domestic product (GDP) of the previous year exceeds 2 4/5%, or National Government deficit as
a percentage of GDP of the previous year exceeds 1%, when the President, upon recommendation of the
Secretary of Finance shall raise the rate of VAT to 12% effective January 1, 2006.
2. With regard to the disagreement on whether only the VAT imposed on electricity generation,
transmission and distribution companies should not be passed on to consumers or whether both the VAT
imposed on electricity generation, transmission and distribution companies and the VAT imposed on
sale of petroleum products may be passed on to consumers, the Bicameral Conference Committee chose
to settle such disagreement by altogether deleting from its Report any no pass-on provision.
3. With regard to the disagreement on whether input tax credits should be limited or not, the
Bicameral Conference Committee decided to adopt the position of the House by putting a limitation on
the amount of input tax that may be credited against the output tax, although it crafted its own language
as to the amount of the limitation on input tax credits and the manner of computing the same by providing
thus:
(A) Creditable Input Tax. . . .
...
Provided, The input tax on goods purchased or imported in a calendar

month for use in trade or business for which deduction for depreciation is
allowed under this Code, shall be spread evenly over the month of
acquisition and the fifty-nine (59) succeeding months if the aggregate
acquisition cost for such goods, excluding the VAT component thereof,
exceeds one million Pesos (P1,000,000.00): PROVIDED, however, that if
the estimated useful life of the capital good is less than five (5) years, as
used for depreciation purposes, then the input VAT shall be spread over
such shorter period: . . .
(B) Excess Output or Input Tax. If at the end of any taxable quarter the
output tax exceeds the input tax, the excess shall be paid by the VAT-
registered person. If the input tax exceeds the output tax, the excess shall
be carried over to the succeeding quarter or quarters: PROVIDED that the
input tax inclusive of input VAT carried over from the previous quarter
that may be credited in every quarter shall not exceed seventy percent
(70%) of the output VAT: PROVIDED, HOWEVER, THAT any input tax
attributable to zero-rated sales by a VAT-registered person may at his
option be refunded or credited against other internal revenue taxes, . . .
4. With regard to the amendments to other provisions of the NIRC on corporate income tax,
franchise, percentage and excise taxes, the conference committee decided to include such amendments
and basically adopted the provisions found in Senate Bill No. 1950, with some changes as to the rate of
the tax to be imposed.
Under the provisions of both the Rules of the House of Representatives and Senate Rules, the
Bicameral Conference Committee is mandated to settle the differences between the disagreeing provisions
in the House bill and the Senate bill. The term settle is synonymous to reconcile and harmonize.[25] To
reconcile or harmonize disagreeing provisions, the Bicameral Conference Committee may then (a) adopt
the specific provisions of either the House bill or Senate bill, (b) decide that neither provisions in the House
bill or the provisions in the Senate bill would
be carried into the final form of the bill, and/or (c) try to arrive at a compromise between the disagreeing
provisions.
In the present case, the changes introduced by the Bicameral Conference Committee on disagreeing
provisions were meant only to reconcile and harmonize the disagreeing provisions for it did not inject any
idea or intent that is wholly foreign to the subject embraced by the original provisions.
The so-called stand-by authority in favor of the President, whereby the rate of 10% VAT wanted
by the Senate is retained until such time that certain conditions arise when the 12% VAT wanted by the
House shall be imposed, appears to be a compromise to try to bridge the difference in the rate of VAT
proposed by the two houses of Congress. Nevertheless, such compromise is still totally within the subject
of what rate of VAT should be imposed on taxpayers.
The no pass-on provision was deleted altogether. In the transcripts of the proceedings of the
Bicameral Conference Committee held on May 10, 2005, Sen. Ralph Recto, Chairman of the Senate Panel,
explained the reason for deleting the no pass-on provision in this wise:
. . . the thinking was just to keep the VAT law or the VAT bill simple. And we
were thinking that no sector should be a beneficiary of legislative grace, neither should any
sector be discriminated on. The VAT is an indirect tax. It is a pass on-tax. And lets keep
it plain and simple. Lets not confuse the bill and put a no pass-on provision. Two-thirds of
the world have a VAT system and in this two-thirds of the globe, I have yet to see a VAT
with a no pass-though provision. So, the thinking of the Senate is basically simple, lets
keep the VAT simple.[26] (Emphasis supplied)
Rep. Teodoro Locsin further made the manifestation that the no pass-on provision never really
enjoyed the support of either House.[27]
With regard to the amount of input tax to be credited against output tax, the Bicameral Conference
Committee came to a compromise on the percentage rate of the limitation or cap on such input tax credit,
but again, the change introduced by the Bicameral Conference Committee was totally within the intent of
both houses to put a cap on input tax that may be
credited against the output tax. From the inception of the subject revenue bill in the House of
Representatives, one of the major objectives was to plug a glaring loophole in the tax policy and
administration by creating vital restrictions on the claiming of input VAT tax credits . . . and [b]y
introducing limitations on the claiming of tax credit, we are capping a major leakage that has placed our
collection efforts at an apparent disadvantage.[28]
As to the amendments to NIRC provisions on taxes other than the value-added tax proposed in
Senate Bill No. 1950, since said provisions were among those referred to it, the conference committee had
to act on the same and it basically adopted the version of the Senate.
Thus, all the changes or modifications made by the Bicameral Conference Committee were
germane to subjects of the provisions referred
to it for reconciliation. Such being the case, the Court does not see any grave abuse of discretion amounting
to lack or excess of jurisdiction committed by the Bicameral Conference Committee. In the earlier cases
of Philippine Judges Association vs. Prado[29] and Tolentino vs. Secretary of Finance,[30] the Court
recognized the long-standing legislative practice of giving said conference committee ample latitude for
compromising differences between the Senate and the House. Thus, in the Tolentino case, it was held that:
. . . it is within the power of a conference committee to include in its report an

entirely new provision that is not found either in the House bill or in the Senate bill. If the
committee can propose an amendment consisting of one or two provisions, there is no
reason why it cannot propose several provisions, collectively considered as an amendment
in the nature of a substitute, so long as such amendment is germane to the subject of the
bills before the committee. After all, its report was not final but needed the approval of
both houses of Congress to become valid as an act of the legislative department. The
charge that in this case the Conference Committee acted as a third legislative chamber
is thus without any basis.[31] (Emphasis supplied)
B. R.A. No. 9337 Does Not Violate Article VI, Section 26(2) of the
Constitution on the No-Amendment Rule
Article VI, Sec. 26 (2) of the Constitution, states:
No bill passed by either House shall become a law unless it has passed three
readings on separate days, and printed copies thereof in its final form have been distributed
to its Members three days before its passage, except when the President certifies to the
necessity of its immediate enactment to meet a public calamity or emergency. Upon the
last reading of a bill, no amendment thereto shall be allowed, and the vote thereon shall be
taken immediately thereafter, and the yeas and nays entered in the Journal.
Petitioners argument that the practice where a bicameral conference committee is allowed to add
or delete provisions in the House bill and the Senate bill after these had passed three readings is in effect a
circumvention of the no amendment rule (Sec. 26 (2), Art. VI of the 1987 Constitution), fails to convince
the Court to deviate from its ruling in the Tolentino case that:
Nor is there any reason for requiring that the Committees Report in these cases
must have undergone three readings in each of the two houses. If that be the case, there
would be no end to negotiation since each house may seek modification of the compromise
bill. . . .
Art. VI. 26 (2) must, therefore, be construed as referring only to bills

introduced for the first time in either house of Congress, not to the conference
committee report.[32](Emphasis supplied)
The Court reiterates here that the no-amendment rule refers only to the procedure to be
followed by each house of Congress with regard to bills initiated in each of said respective houses,
before said bill is transmitted to the other house for its concurrence or amendment. Verily, to construe
said provision in a way as to proscribe any further changes to a bill after one house has voted on it would
lead to absurdity as this would mean that the other house of Congress would be deprived of its constitutional
power to amend or introduce changes to said bill. Thus, Art. VI, Sec. 26 (2) of the Constitution cannot be
taken to mean that the introduction by the Bicameral Conference Committee of amendments and
modifications to disagreeing provisions in bills that have been acted upon by both houses of Congress is
prohibited.
C. R.A. No. 9337 Does Not Violate Article VI, Section 24 of the
Constitution on Exclusive Origination of Revenue Bills
Coming to the issue of the validity of the amendments made regarding the NIRC provisions on
corporate income taxes and percentage, excise taxes. Petitioners refer to the following provisions, to wit:
Section
27
Rates of Income Tax on Domestic Corporation
28(A)(1) Tax on Resident Foreign Corporation
28(B)(1) Inter-corporate Dividends
34(B)(1) Inter-corporate Dividends
116 Tax on Persons Exempt from VAT
117 Percentage Tax on domestic carriers and keepers
of Garage
119 Tax on franchises

121 Tax on banks and Non-Bank Financial
Intermediaries
148 Excise Tax on manufactured oils and other fuels
151 Excise Tax on mineral products
236 Registration requirements
237 Issuance of receipts or sales or commercial
invoices
288 Disposition of Incremental Revenue
Petitioners claim that the amendments to these provisions of the NIRC did not at all originate from
the House. They aver that House Bill No. 3555 proposed amendments only regarding Sections 106, 107,
108, 110 and 114 of the NIRC, while House Bill No. 3705 proposed amendments only to Sections 106,
107,108, 109, 110 and 111 of the NIRC; thus, the other sections of the NIRC which the Senate amended
but which amendments were not found in the House bills are not intended to be amended by the House of
Representatives. Hence, they argue that since the proposed amendments did not originate from the House,
such amendments are a violation of Article VI, Section 24 of the Constitution.
The argument does not hold water.
Article VI, Section 24 of the Constitution reads:
Sec. 24. All appropriation, revenue or tariff bills, bills authorizing increase of the
public debt, bills of local application, and private bills shall originate exclusively in the
House of Representatives but the Senate may propose or concur with amendments.
In the present cases, petitioners admit that it was indeed House Bill Nos. 3555 and 3705 that
initiated the move for amending provisions of the NIRC dealing mainly with the value-added tax. Upon
transmittal of said House bills to the Senate, the Senate came out with Senate Bill No. 1950 proposing
amendments not only to NIRC provisions on the value-added tax but also amendments to NIRC provisions
on other kinds of taxes. Is the introduction by the Senate of provisions not dealing directly with the value-
added tax, which is the only kind of tax being amended in the House bills, still within the purview of the
constitutional provision authorizing the Senate to propose or concur with amendments to a revenue bill that
originated from the House?
The foregoing question had been squarely answered in the Tolentino case, wherein the Court held,
thus:
. . . To begin with, it is not the law but the revenue bill which is required by the
Constitution to originate exclusively in the House of Representatives. It is important to
emphasize this, because a bill originating in the House may undergo such extensive
changes in the Senate that the result may be a rewriting of the whole. . . . At this point,
what is important to note is that, as a result of the Senate action, a distinct bill may be
produced. To insist that a revenue statute and not only the bill which initiated the
legislative process culminating in the enactment of the law must substantially be the
same as the House bill would be to deny the Senates power not only to concur with
amendments but also to propose amendments. It would be to violate the coequality of
legislative power of the two houses of Congress and in fact make the House superior to the
Senate.
Given, then, the power of the Senate to propose amendments, the Senate can
propose its own version even with respect to bills which are required by the
Constitution to originate in the House.
...
Indeed, what the Constitution simply means is that the initiative for filing revenue,
tariff or tax bills, bills authorizing an increase of the public debt, private bills and bills of
local application must come from the House of Representatives on the theory that, elected
as they are from the districts, the members of the House can be expected to be more
sensitive to the local needs and problems. On the other hand, the senators, who are
elected at large, are expected to approach the same problems from the national
perspective. Both views are thereby made to bear on the enactment of such
laws.[33] (Emphasis supplied)
Since there is no question that the revenue bill exclusively originated in the House of
Representatives, the Senate was acting within its
constitutional power to introduce amendments to the House bill when it included provisions in Senate Bill
No. 1950 amending corporate income taxes, percentage, excise and franchise taxes. Verily, Article VI,
Section 24 of the Constitution does not contain any prohibition or limitation on the extent of the
amendments that may be introduced by the Senate to the House revenue bill.
Furthermore, the amendments introduced by the Senate to the NIRC provisions that had not been
touched in the House bills are still in furtherance of the intent of the House in initiating the subject revenue
bills. The Explanatory Note of House Bill No. 1468, the very first House bill introduced on the floor, which
was later substituted by House Bill No. 3555, stated:
One of the challenges faced by the present administration is the urgent and
daunting task of solving the countrys serious financial problems. To do this, government
expenditures must be strictly monitored and controlled and revenues must be significantly
increased. This may be easier said than done, but our fiscal authorities are still optimistic
the government will be operating on a balanced budget by the year 2009. In fact, several
measures that will result to significant expenditure savings have been identified by the
administration. It is supported with a credible package of revenue measures that
include measures to improve tax administration and control the leakages in revenues
from income taxes and the value-added tax (VAT). (Emphasis supplied)
Rep. Eric D. Singson, in his sponsorship speech for House Bill No. 3555, declared that:
In the budget message of our President in the year 2005, she reiterated that we all
acknowledged that on top of our agenda must be the restoration of the health of our fiscal
system.
In order to considerably lower the consolidated public sector deficit and eventually
achieve a balanced budget by the year 2009, we need to seize windows of opportunities
which might seem poignant in the beginning, but in the long run prove effective and
beneficial to the overall status of our economy. One such opportunity is a review of
existing tax rates, evaluating the relevance given our present conditions.[34] (Emphasis
supplied)
Notably therefore, the main purpose of the bills emanating from the House of Representatives is to
bring in sizeable revenues for the government
to supplement our countrys serious financial problems, and improve tax administration and control of the
leakages in revenues from income taxes and value-added taxes. As these house bills were transmitted to the
Senate, the latter, approaching the measures from the point of national perspective, can introduce
amendments within the purposes of those bills. It can provide for ways that would soften the impact of the
VAT measure on the consumer, i.e., by distributing the burden across all sectors instead of putting it entirely
on the shoulders of the consumers. The sponsorship speech of Sen. Ralph Recto on why the provisions on
income tax on corporation were included is worth quoting:
All in all, the proposal of the Senate Committee on Ways and Means will
raise P64.3 billion in additional revenues annually even while by mitigating prices of
power, services and petroleum products.
However, not all of this will be wrung out of VAT. In fact, only P48.7 billion
amount is from the VAT on twelve goods and services. The rest of the tab P10.5 billion-
will be picked by corporations.
What we therefore prescribe is a burden sharing between corporate Philippines and

the consumer. Why should the latter bear all the pain? Why should the fiscal salvation be
only on the burden of the consumer?
The corporate worlds equity is in form of the increase in the corporate income tax
from 32 to 35 percent, but up to 2008 only. This will raise P10.5 billion a year. After that,
the rate will slide back, not to its old rate of 32 percent, but two notches lower, to 30 percent.
Clearly, we are telling those with the capacity to pay, corporations, to bear with
this emergency provision that will be in effect for 1,200 days, while we put our fiscal house
in order. This fiscal medicine will have an expiry date.
For their assistance, a reward of tax reduction awaits them. We intend to keep the
length of their sacrifice brief. We would like to assure them that not because there is a light
at the end of the tunnel, this government will keep on making the tunnel long.
The responsibility will not rest solely on the weary shoulders of the small man. Big
business will be there to share the burden.[35]
As the Court has said, the Senate can propose amendments and in fact, the amendments made on
provisions in the tax on income of corporations are germane to the purpose of the house bills which is to
raise revenues for the government.
Likewise, the Court finds the sections referring to other percentage and excise taxes germane to the
reforms to the VAT system, as these sections would cushion the effects of VAT on consumers. Considering
that certain goods and services which were subject to percentage tax and excise tax would no longer be
VAT-exempt, the consumer would be burdened more as they would be paying the VAT in addition to these
taxes. Thus, there is a need to amend these sections to soften the impact of VAT. Again, in his sponsorship
speech, Sen. Recto said:
However, for power plants that run on oil, we will reduce to zero the present excise
tax on bunker fuel, to lessen the effect of a VAT on this product.
For electric utilities like Meralco, we will wipe out the franchise tax in exchange
for a VAT.
And in the case of petroleum, while we will levy the VAT on oil products, so as
not to destroy the VAT chain, we will however bring down the excise tax on socially
sensitive products such as diesel, bunker, fuel and kerosene.
...
What do all these exercises point to? These are not contortions of giving to the left
hand what was taken from the right. Rather, these sprang from our concern of softening
the impact of VAT, so that the people can cushion the blow of higher prices they will have
to pay as a result of VAT.[36]
The other sections amended by the Senate pertained to matters of tax administration which are
necessary for the implementation of the changes in the VAT system.
To reiterate, the sections introduced by the Senate are germane to the subject matter and purposes
of the house bills, which is to supplement our countrys fiscal deficit, among others. Thus, the Senate acted
within its power to propose those amendments.
SUBSTANTIVE ISSUES
I.
Whether Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106, 107 and 108 of the NIRC, violate
the following provisions of the Constitution:

A. No Undue Delegation of Legislative Power
Petitioners ABAKADA GURO Party List, et al., Pimentel, Jr., et al., and Escudero, et al. contend in
common that Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106, 107 and 108, respectively, of
the NIRC giving the President the stand-by authority to raise the VAT rate from 10% to 12% when a certain
condition is met, constitutes undue delegation of the legislative power to tax.
The assailed provisions read as follows:
SEC. 4. Sec. 106 of the same Code, as amended, is hereby further amended to read
as follows:
SEC. 106. Value-Added Tax on Sale of Goods or Properties.
(A) Rate and Base of Tax. There shall be levied, assessed and collected on
every sale, barter or exchange of goods or properties, a value-added tax
equivalent to ten percent (10%) of the gross selling price or gross value in
money of the goods or properties sold, bartered or exchanged, such tax to
be paid by the seller or transferor: provided, that the President, upon the
recommendation of the Secretary of Finance, shall, effective January
1, 2006, raise the rate of value-added tax to twelve percent (12%),
after any of the following conditions has been satisfied.
(i) value-added tax collection as a percentage of Gross

Domestic Product (GDP) of the previous year exceeds two and
four-fifth percent (2 4/5%) or
(ii) national government deficit as a percentage of GDP of the previous

year exceeds one and one-half percent (1 %).
SEC. 5. Section 107 of the same Code, as amended, is hereby further amended to
read as follows:
SEC. 107. Value-Added Tax on Importation of Goods.

(A) In General. There shall be levied, assessed and collected on every
importation of goods a value-added tax equivalent to ten percent (10%)
based on the total value used by the Bureau of Customs in determining
tariff and customs duties, plus customs duties, excise taxes, if any, and
other charges, such tax to be paid by the importer prior to the release of
such goods from customs custody: Provided, That where the customs
duties are determined on the basis of the quantity or volume of the goods,
the value-added tax shall be based on the landed cost plus excise taxes, if
any: provided, further, that the President, upon the recommendation
of the Secretary of Finance, shall, effective January 1, 2006, raise the
rate of value-added tax to twelve percent (12%) after any of the
following conditions has been satisfied.
(i) value-added tax collection as a percentage of Gross Domestic

Product (GDP) of the previous year exceeds two and four-fifth
percent (2 4/5%) or
year exceeds one and one-half percent (1 %).
SEC. 6. Section 108 of the same Code, as amended, is hereby further amended to
read as follows:
SEC. 108. Value-added Tax on Sale of Services and Use or Lease of

Properties
(A) Rate and Base of Tax. There shall be levied, assessed and collected, a
value-added tax equivalent to ten percent (10%) of gross receipts derived
from the sale or exchange of services: provided, that the President, upon
the recommendation of the Secretary of Finance, shall, effective
January 1, 2006, raise the rate of value-added tax to twelve percent
(12%), after any of the following conditions has been satisfied.
(i) value-added tax collection as a percentage of Gross Domestic

Product (GDP) of the previous year exceeds two and four-fifth
percent (2 4/5%) or
year exceeds one and one-half percent (1 %). (Emphasis
supplied)
Petitioners allege that the grant of the stand-by authority to the President to increase the VAT rate
is a virtual abdication by Congress of its exclusive power to tax because such delegation is not within the
purview of Section 28 (2), Article VI of the Constitution, which provides:
The Congress may, by law, authorize the President to fix within specified limits,
and may impose, tariff rates, import and export quotas, tonnage and wharfage dues, and
other duties or imposts within the framework of the national development program of the
government.
They argue that the VAT is a tax levied on the sale, barter or exchange of goods and properties as
well as on the sale or exchange of services, which cannot be included within the purview of tariffs under
the exempted delegation as the latter refers to customs duties, tolls or tribute payable upon merchandise to
the government and usually imposed on goods or merchandise imported or exported.
Petitioners ABAKADA GURO Party List, et al., further contend that delegating to the President the
legislative power to tax is contrary to republicanism. They insist that accountability, responsibility and
transparency should dictate the actions of Congress and they should not pass to the President the decision
to impose taxes. They also argue that the law also effectively nullified the Presidents power of control,
which includes the authority to set aside and nullify the acts of her subordinates like the Secretary of
Finance, by mandating the fixing of the tax rate by the President upon the recommendation of the Secretary
of Finance.
Petitioners Pimentel, et al. aver that the President has ample powers to cause, influence or create
the conditions provided by the law to bring about either or both the conditions precedent.
On the other hand, petitioners Escudero, et al. find bizarre and revolting the situation that the
imposition of the 12% rate would be subject to the whim of the Secretary of Finance, an unelected
bureaucrat, contrary to the principle of no taxation without representation. They submit that the Secretary
of Finance is not mandated to give a favorable recommendation and he may not even give his
recommendation. Moreover, they allege that no guiding standards are provided in the law on what basis
and as to how he will make his recommendation. They claim, nonetheless, that any recommendation of the
Secretary of Finance can easily be brushed aside by the President since the former is a mere alter ego of the
latter, such that, ultimately, it is the President who decides whether to impose the increased tax rate or not.
A brief discourse on the principle of non-delegation of powers is instructive.
The principle of separation of powers ordains that each of the three great branches of government
has exclusive cognizance of and is supreme in matters falling within its own constitutionally allocated
sphere.[37] A logical
corollary to the doctrine of separation of powers is the principle of non-delegation of powers, as expressed
in the Latin maxim: potestas delegata non delegari potest which means what has been delegated, cannot be
delegated.[38] This doctrine is based on the ethical principle that such as delegated power constitutes not
only a right but a duty to be performed by the delegate through the instrumentality of his own judgment and
not through the intervening mind of another.[39]
With respect to the Legislature, Section 1 of Article VI of the Constitution provides that the
Legislative power shall be vested in the Congress of the Philippines which shall consist of a Senate and a
House of Representatives. The powers which Congress is prohibited from delegating are those which are
strictly, or inherently and exclusively, legislative. Purely legislative power, which can never be delegated,
has been described as the authority to make a complete law complete as to the time when it shall take
effect and as to whom it shall be applicable and to determine the expediency of its enactment.[40] Thus,
the rule is that in order that a court may be justified in holding a statute unconstitutional as a delegation of
legislative power, it must appear that the power involved is purely legislative in nature that is, one
appertaining exclusively to the legislative department. It is the nature of the power, and not the liability of
its use or the manner of its exercise, which determines the validity of its delegation.
Nonetheless, the general rule barring delegation of legislative powers is subject to the following
recognized limitations or exceptions:
(1) Delegation of tariff powers to the President under Section 28 (2) of Article VI of the
Constitution;
(2) Delegation of emergency powers to the President under Section 23 (2) of Article VI of
the Constitution;
(5) Delegation to administrative bodies.
In every case of permissible delegation, there must be a showing that the delegation itself is valid.
It is valid only if the law (a) is complete in itself, setting forth therein the policy to be executed, carried out,
or implemented by the delegate;[41] and (b) fixes a standard the limits of which are sufficiently determinate
and determinable to which the delegate must conform in the performance of his functions. [42] A sufficient
standard is one which defines legislative policy, marks its limits, maps out its boundaries and specifies the
public agency to apply it. It indicates the circumstances under which the legislative command is to be
effected.[43] Both tests are intended to prevent a total transference of legislative authority to the delegate,
who is not allowed to step into the shoes of the legislature and exercise a power essentially legislative.[44]
In People vs. Vera,[45] the Court, through eminent Justice Jose P. Laurel, expounded on the concept
and extent of delegation of power in this wise:
In testing whether a statute constitutes an undue delegation of legislative power or

not, it is usual to inquire whether the statute was complete in all its terms and provisions
when it left the hands of the legislature so that nothing was left to the judgment of any other
appointee or delegate of the legislature.
The true distinction, says Judge Ranney, is between the delegation of power
to make the law, which necessarily involves a discretion as to what it shall be, and
conferring an authority or discretion as to its execution, to be exercised under and in
pursuance of the law. The first cannot be done; to the latter no valid objection can be
made.
...
It is contended, however, that a legislative act may be made to the effect as law
after it leaves the hands of the legislature. It is true that laws may be made effective on
certain contingencies, as by proclamation of the executive or the adoption by the people of
a particular community. In Wayman vs. Southard, the Supreme Court of the United States
ruled that the legislature may delegate a power not legislative which it may itself rightfully
exercise. The power to ascertain facts is such a power which may be delegated. There
is nothing essentially legislative in ascertaining the existence of facts or conditions as
the basis of the taking into effect of a law. That is a mental process common to all
branches of the government.Notwithstanding the apparent tendency, however, to relax
the rule prohibiting delegation of legislative authority on account of the complexity arising
from social and economic forces at work in this modern industrial age, the orthodox
pronouncement of Judge Cooley in his work on Constitutional Limitations finds
restatement in Prof. Willoughby's treatise on the Constitution of the United States in the
following language speaking of declaration of legislative power to administrative
agencies: The principle which permits the legislature to provide that the
administrative agent may determine when the circumstances are such as require the
application of a law is defended upon the ground that at the time this authority is
granted, the rule of public policy, which is the essence of the legislative act, is
determined by the legislature. In other words, the legislature, as it is its duty to do,
determines that, under given circumstances, certain executive or administrative
action is to be taken, and that, under other circumstances, different or no action at all
is to be taken. What is thus left to the administrative official is not the legislative
determination of what public policy demands, but simply the ascertainment of what
the facts of the case require to be done according to the terms of the law by which he
is governed. The efficiency of an Act as a declaration of legislative will must, of course,
come from Congress, but the ascertainment of the contingency upon which the Act
shall take effect may be left to such agencies as it may designate. The legislature, then,
may provide that a law shall take effect upon the happening of future specified
contingencies leaving to some other person or body the power to determine when the
specified contingency has arisen. (Emphasis supplied).[46]
In Edu vs. Ericta,[47] the Court reiterated:
What cannot be delegated is the authority under the Constitution to make laws and
to alter and repeal them; the test is the completeness of the statute in all its terms and
provisions when it leaves the hands of the legislature. To determine whether or not there is
an undue delegation of legislative power, the inquiry must be directed to the scope and
definiteness of the measure enacted. The legislative does not abdicate its functions when
it describes what job must be done, who is to do it, and what is the scope of his
authority. For a complex economy, that may be the only way in which the legislative
process can go forward. A distinction has rightfully been made between delegation of
power to make the laws which necessarily involves a discretion as to what it shall be,
which constitutionally may not be done, and delegation of authority or discretion as
to its execution to be exercised under and in pursuance of the law, to which no valid
objection can be made. The Constitution is thus not to be regarded as denying the
legislature the necessary resources of flexibility and practicability. (Emphasis supplied).[48]
Clearly, the legislature may delegate to executive officers or bodies the power to determine certain
facts or conditions, or the happening of contingencies, on which the operation of a statute is, by its terms,
made to depend, but the legislature must prescribe sufficient standards, policies or limitations on their
authority.[49] While the power to tax cannot be delegated to executive agencies, details as to the enforcement
and administration of an exercise of such power may be left to them, including the power to determine the
existence of facts on which its operation depends.[50]
The rationale for this is that the preliminary ascertainment of facts as basis for the enactment of
legislation is not of itself a legislative function, but is simply ancillary to legislation. Thus, the duty of
correlating information and making recommendations is the kind of subsidiary activity which the legislature
may perform through its members, or which it may delegate to others to perform. Intelligent legislation on
the complicated problems of modern society is impossible in the absence of accurate information on the
part of the legislators, and any reasonable method of securing such information is proper.[51] The
Constitution as a continuously operative charter of government does not require that Congress find for itself
every fact upon which it desires to base legislative action or that it make for itself detailed determinations
which it has declared to be prerequisite to application of legislative policy to particular facts and
circumstances impossible for Congress itself properly to investigate.[52]
In the present case, the challenged section of R.A. No. 9337 is the common proviso in Sections 4,
5 and 6 which reads as follows:
That the President, upon the recommendation of the Secretary of Finance, shall,
effective January 1, 2006, raise the rate of value-added tax to twelve percent (12%), after
any of the following conditions has been satisfied:
(i) Value-added tax collection as a percentage of Gross Domestic

Product (GDP) of the previous year exceeds two and four-fifth percent (2
4/5%); or
(ii) National government deficit as a percentage of GDP of the

previous year exceeds one and one-half percent (1 %).
The case before the Court is not a delegation of legislative power. It is simply a delegation of
ascertainment of facts upon which enforcement and administration of the increase rate under the law is
contingent. The legislature has made the operation of the 12% rate effective January 1, 2006, contingent
upon a specified fact or condition. It leaves the entire operation or non-operation of the 12% rate upon
factual matters outside of the control of the executive.
No discretion would be exercised by the President. Highlighting the absence of discretion is the
fact that the word shall is used in the common proviso. The use of the word shall connotes a mandatory
order. Its use in a statute denotes an imperative obligation and is inconsistent with the idea of
discretion.[53] Where the law is clear and unambiguous, it must be taken to mean exactly what it says, and
courts have no choice but to see to it that the mandate is obeyed.[54]
Thus, it is the ministerial duty of the President to immediately impose the 12% rate upon the
existence of any of the conditions specified by Congress. This is a duty which cannot be evaded by the
President. Inasmuch as the law specifically uses the word shall, the exercise of discretion by the President
does not come into play. It is a clear directive to impose the 12% VAT rate when the specified conditions
are present. The time of taking into effect of the 12% VAT rate is based on the happening of a certain
specified contingency, or upon the ascertainment of certain facts or conditions by a person or body other
than the legislature itself.
The Court finds no merit to the contention of petitioners ABAKADA GURO Party List, et al. that
the law effectively nullified the Presidents power of control over the Secretary of Finance by mandating the
fixing of the tax rate by the President upon the recommendation of the Secretary of Finance. The Court
cannot also subscribe to the position of petitioners
Pimentel, et al. that the word shall should be interpreted to mean may in view of the phrase upon the
recommendation of the Secretary of Finance. Neither does the Court find persuasive the submission of
petitioners Escudero, et al. that any recommendation by the Secretary of Finance can easily be brushed
aside by the President since the former is a mere alter ego of the latter.
When one speaks of the Secretary of Finance as the alter ego of the President, it simply means that
as head of the Department of Finance he is the assistant and agent of the Chief Executive. The multifarious
executive and administrative functions of the Chief Executive are performed by and through the executive
departments, and the acts of the secretaries of such departments, such as the Department of Finance,
performed and promulgated in the regular course of business, are, unless disapproved or reprobated by the
Chief Executive, presumptively the acts of the Chief Executive. The Secretary of Finance, as such, occupies
a political position and holds office in an advisory capacity, and, in the language of Thomas Jefferson,
"should be of the President's bosom confidence" and, in the language of Attorney-General Cushing, is
subject to the direction of the President."[55]
In the present case, in making his recommendation to the President on the existence of either of the
two conditions, the Secretary of Finance is not acting as the alter ego of the President or even her
subordinate. In such instance, he is not subject to the power of control and direction of the President. He is
acting as the agent of the legislative department, to determine and declare the event upon which its
expressed will is to take effect.[56] The Secretary of Finance becomes the means or tool by which legislative
policy is determined and implemented, considering that he possesses all the facilities to gather data and
information and has a much broader perspective to properly evaluate them. His function is to gather and
collate statistical data and other pertinent information and verify if any of the two conditions laid out by
Congress is present. His personality in such instance is in reality but a projection of that of Congress. Thus,
being the agent of Congress and not of the President, the President cannot alter or modify or nullify, or set
aside the findings of the Secretary of Finance and to substitute the judgment of the former for that of the
latter.
Congress simply granted the Secretary of Finance the authority to ascertain the existence of a fact,
namely, whether by December 31, 2005, the value-added tax collection as a percentage of Gross Domestic
Product (GDP) of the previous year exceeds two and four-fifth percent (24/5%) or the national government
deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1%). If either of
these two instances has occurred, the Secretary of Finance, by legislative mandate, must submit such
information to the President. Then the 12% VAT rate must be imposed by the President effective January
1, 2006. There is no undue delegation of legislative power but only of the discretion as to the execution
of a law. This is constitutionally permissible.[57] Congress does not abdicate its functions or unduly
delegate power when it describes what job must be done, who must do it, and what is the scope of his
authority; in our complex economy that is frequently the only way in which the legislative process can go
forward.[58]
As to the argument of petitioners ABAKADA GURO Party List, et al. that delegating to the
President the legislative power to tax is contrary to the principle of republicanism, the same deserves scant
consideration. Congress did not delegate the power to tax but the mere implementation of the law. The
intent and will to increase the VAT rate to 12% came from Congress and the task of the President is to
simply execute the legislative policy. That Congress chose to do so in such a manner is not within the
province of the Court to inquire into, its task being to interpret the law.[59]
The insinuation by petitioners Pimentel, et al. that the President has ample powers to cause, influence or
create the conditions to bring about either or both the conditions precedent does not deserve any merit as
this argument is highly speculative. The Court does not rule on allegations which are manifestly conjectural,
as these may not exist at all.The Court deals with facts, not fancies; on realities, not appearances. When the
Court acts on appearances instead of realities, justice and law will be short-lived.
B. The 12% Increase VAT Rate Does Not Impose an Unfair and
Unnecessary Additional Tax Burden
Petitioners Pimentel, et al. argue that the 12% increase in the VAT rate imposes an unfair and
additional tax burden on the people. Petitioners also argue that the 12% increase, dependent on any of
the 2 conditions set forth in the contested provisions, is ambiguous because it does not state if the VAT
rate would be returned to the original 10% if the rates are no longer satisfied. Petitioners also argue that
such rate is unfair and unreasonable, as the people are unsure of the applicable VAT rate from year to
year.
Under the common provisos of Sections 4, 5 and 6 of R.A. No. 9337, if any of the two conditions
set forth therein are satisfied, the President shall increase the VAT rate to 12%. The provisions of the law
are clear. It does not provide for a return to the 10% rate nor does it empower the President to so revert if,
after the rate is increased to 12%, the VAT collection goes below the 24/5 of the GDP of the previous year
or that the national government deficit as a percentage of GDP of the previous year does not exceed 1%.
Therefore, no statutory construction or interpretation is needed. Neither can conditions or

limitations be introduced where none is provided for. Rewriting the law is a forbidden ground that only
Congress may tread upon.[60]
Thus, in the absence of any provision providing for a return to the 10% rate, which in this case the
Court finds none, petitioners argument is, at best, purely speculative. There is no basis for petitioners fear
of a fluctuating VAT rate because the law itself does not provide that the rate should go back to 10% if the
conditions provided in Sections 4, 5 and 6 are no longer present. The rule is that where the provision of the
law is clear and unambiguous, so that there is no occasion for the court's seeking the legislative intent, the
law must be taken as it is, devoid of judicial addition or subtraction.[61]
Petitioners also contend that the increase in the VAT rate, which was allegedly an incentive to the
President to raise the VAT collection to at least 2 4/5 of the GDP of the previous year, should be based on
fiscal adequacy.
Petitioners obviously overlooked that increase in VAT collection is not the only condition. There
is another condition, i.e., the national government deficit as a percentage of GDP of the previous year
exceeds one and one-half percent (1 %).
Respondents explained the philosophy behind these alternative conditions:
1. VAT/GDP Ratio > 2.8%
The condition set for increasing VAT rate to 12% have economic or fiscal
meaning. If VAT/GDP is less than 2.8%, it means that government has weak or no
capability of implementing the VAT or that VAT is not effective in the function of the tax
collection. Therefore, there is no value to increase it to 12% because such action will also
be ineffectual.
2. Natl Govt Deficit/GDP >1.5%

The condition set for increasing VAT when deficit/GDP is 1.5% or less means the
fiscal condition of government has reached a relatively sound position or is towards the
direction of a balanced budget position. Therefore, there is no need to increase the VAT
rate since the fiscal house is in a relatively healthy position. Otherwise stated, if the ratio
is more than 1.5%, there is indeed a need to increase the VAT rate.[62]
That the first condition amounts to an incentive to the President to increase the VAT collection
does not render it unconstitutional so long as there is a public purpose for which the law was passed, which
in this case, is mainly to raise revenue. In fact, fiscal adequacy dictated the need for a raise in revenue.
The principle of fiscal adequacy as a characteristic of a sound tax system was originally stated by
Adam Smith in his Canons of Taxation (1776), as:
IV. Every tax ought to be so contrived as both to take out and to keep out of the pockets
of the people as little as possible over and above what it brings into the public
treasury of the state.[63]
It simply means that sources of revenues must be adequate to meet government expenditures and
their variations.[64]
The dire need for revenue cannot be ignored. Our country is in a quagmire of financial woe. During
the Bicameral Conference Committee hearing, then Finance Secretary Purisima bluntly depicted the
countrys gloomy state of economic affairs, thus:
First, let me explain the position that the Philippines finds itself in right now. We
are in a position where 90 percent of our revenue is used for debt service. So, for every
peso of revenue that we currently raise, 90 goes to debt service. Thats interest plus
amortization of our debt. So clearly, this is not a sustainable situation. Thats the first fact.
The second fact is that our debt to GDP level is way out of line compared to other
peer countries that borrow money from that international financial markets. Our debt to
GDP is approximately equal to our GDP. Again, that shows you that this is not a sustainable
situation.
The third thing that Id like to point out is the environment that we are presently
operating in is not as benign as what it used to be the past five years.
What do I mean by that?
In the past five years, weve been lucky because we were operating in a period of
basically global growth and low interest rates. The past few months, we have seen an
inching up, in fact, a rapid increase in the interest rates in the leading economies of the
world. And, therefore, our ability to borrow at reasonable prices is going to be challenged.
In fact, ultimately, the question is our ability to access the financial markets.
When the President made her speech in July last year, the environment was not as
bad as it is now, at least based on the forecast of most financial institutions. So, we were
assuming that raising 80 billion would put us in a position where we can then convince
them to improve our ability to borrow at lower rates. But conditions have changed on us
because the interest rates have gone up. In fact, just within this room, we tried to access the
market for a billion dollars because for this year alone, the Philippines will have to borrow
4 billion dollars. Of that amount, we have borrowed 1.5 billion. We issued last January a
25-year bond at 9.7 percent cost. We were trying to access last week and the market was
not as favorable and up to now we have not accessed and we might pull back because the
conditions are not very good.
So given this situation, we at the Department of Finance believe that we really need
to front-end our deficit reduction. Because it is deficit that is causing the increase of the
debt and we are in what we call a debt spiral. The more debt you have, the more deficit you
have because interest and debt service eats and eats more of your revenue. We need to get
out of this debt spiral. And the only way, I think, we can get out of this debt spiral is really
have a front-end adjustment in our revenue base.[65]
The image portrayed is chilling. Congress passed the law hoping for rescue from an inevitable
catastrophe. Whether the law is indeed sufficient to answer the states economic dilemma is not for the Court
to judge. In the Farias case, the Court refused to consider the various arguments raised therein that dwelt
on the wisdom of Section 14 of R.A. No. 9006 (The Fair Election Act), pronouncing that:
. . . policy matters are not the concern of the Court. Government policy is within
the exclusive dominion of the political branches of the government. It is not for this Court
to look into the wisdom or propriety of legislative determination. Indeed, whether an
enactment is wise or unwise, whether it is based on sound economic theory, whether it is
the best means to achieve the desired results, whether, in short, the legislative discretion
within its prescribed limits should be exercised in a particular manner are matters for the
judgment of the legislature, and the serious conflict of opinions does not suffice to bring
them within the range of judicial cognizance.[66]
In the same vein, the Court in this case will not dawdle on the purpose of Congress or the executive
policy, given that it is not for the judiciary to "pass upon questions of wisdom, justice or expediency of
legislation.[67]
II.
Whether Section 8 of R.A. No. 9337, amending Sections 110(A)(2) and 110(B) of the NIRC; and Section
12 of R.A. No. 9337, amending Section 114(C) of the NIRC, violate the following provisions of the
Constitution:

b. Article III, Section 1
A. Due Process and Equal Protection Clauses
Petitioners Association of Pilipinas Shell Dealers, Inc., et al. argue that Section 8 of R.A. No. 9337,
amending Sections 110 (A)(2), 110 (B), and Section 12 of R.A. No. 9337, amending Section 114 (C) of the
NIRC are arbitrary, oppressive, excessive and confiscatory. Their argument is premised on the
constitutional right against deprivation of life, liberty of property without due process of law, as embodied
in Article III, Section 1 of the Constitution.
Petitioners also contend that these provisions violate the constitutional guarantee of equal
protection of the law.
The doctrine is that where the due process and equal protection clauses are invoked, considering
that they are not fixed rules but rather broad standards, there is a need for proof of such persuasive character
as would lead to such a conclusion. Absent such a showing, the presumption of validity must prevail.[68]
Section 8 of R.A. No. 9337, amending Section 110(B) of the NIRC imposes a limitation on the
amount of input tax that may be credited against the output tax. It states, in part: [P]rovided, that the input
tax inclusive of the input VAT carried over from the previous quarter that may be credited in every quarter
shall not exceed seventy percent (70%) of the output VAT:
Input Tax is defined under Section 110(A) of the NIRC, as amended, as the value-added tax
due from or paid by a VAT-registered person on the importation of goods or local purchase of good and
services, including lease or use of property, in the course of trade or business, from a VAT-registered
person, and Output Tax is the value-added tax due on the sale or lease of taxable goods or properties or
services by any person registered or required to register under the law.
Petitioners claim that the contested sections impose limitations on the amount of input tax that may
be claimed. In effect, a portion of the input tax that has already been paid cannot now be credited against
the output tax.
Petitioners argument is not absolute. It assumes that the input tax exceeds 70% of the output tax,
and therefore, the input tax in excess of 70% remains uncredited. However, to the extent that the input tax
is less than 70% of the output tax, then 100% of such input tax is still creditable.
More importantly, the excess input tax, if any, is retained in a businesss books of accounts and
remains creditable in the succeeding quarter/s. This is explicitly allowed by Section 110(B), which provides
that if the input tax exceeds the output tax, the excess shall be carried over to the succeeding quarter or
quarters. In addition, Section 112(B) allows a VAT-registered person to apply for the issuance of a tax
credit certificate or refund for any unused input taxes, to the extent that such input taxes have not been
applied against the output taxes. Such unused input tax may be used in payment of his other internal revenue
taxes.
The non-application of the unutilized input tax in a given quarter is not ad infinitum, as petitioners
exaggeratedly contend. Their analysis of the effect of the 70% limitation is incomplete and one-sided. It
ends at the net effect that there will be unapplied/unutilized inputs VAT for a given quarter. It does not
proceed further to the fact that such unapplied/unutilized input tax may be credited in the subsequent periods
as allowed by the carry-over provision of Section 110(B) or that it may later on be refunded through a tax
credit certificate under Section 112(B).
Therefore, petitioners argument must be rejected.
On the other hand, it appears that petitioner Garcia failed to comprehend the operation of the 70%
limitation on the input tax. According to petitioner, the limitation on the creditable input tax in effect allows
VAT-registered establishments to retain a portion of the taxes they collect, which violates the principle that
tax collection and revenue should be for public purposes and expenditures
As earlier stated, the input tax is the tax paid by a person, passed on to him by the seller, when he
buys goods. Output tax meanwhile is the tax due to the person when he sells goods. In computing the VAT
payable, three possible scenarios may arise:
First, if at the end of a taxable quarter the output taxes charged by the seller are equal to the input
taxes that he paid and passed on by the suppliers, then no payment is required;
Second, when the output taxes exceed the input taxes, the person shall be liable for the excess,
which has to be paid to the Bureau of Internal Revenue (BIR);[69] and
Third, if the input taxes exceed the output taxes, the excess shall be carried over to the succeeding
quarter or quarters. Should the input taxes result from zero-rated or effectively zero-rated transactions, any
excess over the output taxes shall instead be refunded to the taxpayer or credited against other internal
revenue taxes, at the taxpayers option.[70]
Section 8 of R.A. No. 9337 however, imposed a 70% limitation on the input tax. Thus, a person
can credit his input tax only up to the extent of 70% of the output tax. In laymans term, the value-added
taxes that a person/taxpayer paid and passed on to him by a seller can only be credited up to 70% of the
value-added taxes that is due to him on a taxable transaction. There is no retention of any tax collection
because the person/taxpayer has already previously paid the input tax to a seller, and the seller will
subsequently remit such input tax to the BIR. The party directly liable for the payment of the tax is the
seller.[71] What only needs to be done is for the person/taxpayer to apply or credit these input taxes, as
evidenced by receipts, against his output taxes.
Petitioners Association of Pilipinas Shell Dealers, Inc., et al. also argue that the input tax partakes
the nature of a property that may not be confiscated, appropriated, or limited without due process of law.
The input tax is not a property or a property right within the constitutional purview of the due
process clause. A VAT-registered persons entitlement to the creditable input tax is a mere statutory
privilege.
The distinction between statutory privileges and vested rights must be borne in mind for persons
have no vested rights in statutory privileges. The state may change or take away rights, which were created
by the law of the state, although it may not take away property, which was vested by virtue of such rights.[72]
Under the previous system of single-stage taxation, taxes paid at every level of distribution are not
recoverable from the taxes payable, although it becomes part of the cost, which is deductible from the gross
revenue. When Pres. Aquino issued E.O. No. 273 imposing a 10% multi-stage tax on all sales, it was then
that the crediting of the input tax paid on purchase or importation of goods and services by VAT-registered
persons against the output tax was introduced.[73] This was adopted by the Expanded VAT Law (R.A. No.
7716),[74] and The Tax Reform Act of 1997 (R.A. No. 8424).[75] The right to credit input tax as against the
output tax is clearly a privilege created by law, a privilege that also the law can remove, or in this case,
limit.
Petitioners also contest as arbitrary, oppressive, excessive and confiscatory, Section 8 of R.A. No.
9337, amending Section 110(A) of the NIRC, which provides:
SEC. 110. Tax Credits.
(A) Creditable Input Tax.
Provided, That the input tax on goods purchased or imported in a calendar month for use
in trade or business for which deduction for depreciation is allowed under this Code, shall
be spread evenly over the month of acquisition and the fifty-nine (59) succeeding months
if the aggregate acquisition cost for such goods, excluding the VAT component thereof,
exceeds One million pesos (P1,000,000.00): Provided, however, That if the estimated
useful life of the capital goods is less than five (5) years, as used for depreciation purposes,
then the input VAT shall be spread over such a shorter period: Provided, finally, That in
the case of purchase of services, lease or use of properties, the input tax shall be creditable
to the purchaser, lessee or license upon payment of the compensation, rental, royalty or fee.
The foregoing section imposes a 60-month period within which to amortize the creditable input tax
on purchase or importation of capital goods with acquisition cost of P1 Million pesos, exclusive of the VAT
component. Such spread out only poses a delay in the crediting of the input tax. Petitioners argument is
without basis because the taxpayer is not permanently deprived of his privilege to credit the input tax.
It is worth mentioning that Congress admitted that the spread-out of the creditable input tax in this
case amounts to a 4-year interest-free loan to the government.[76] In the same breath, Congress also justified
its move by saying that the provision was designed to raise an annual revenue of 22.6 billion.[77] The
legislature also dispelled the fear that the provision will fend off foreign investments, saying that foreign
investors have other tax incentives provided by law, and citing the case of China, where despite a 17.5%
non-creditable VAT, foreign investments were not deterred.[78] Again, for whatever is the purpose of the
60-month amortization, this involves executive economic policy and legislative wisdom in which the Court
cannot intervene.
With regard to the 5% creditable withholding tax imposed on payments made by the government
for taxable transactions, Section 12 of R.A. No. 9337, which amended Section 114 of the NIRC, reads:
SEC. 114. Return and Payment of Value-added Tax.
(C) Withholding of Value-added Tax. The Government or any of its political

subdivisions, instrumentalities or agencies, including government-owned or controlled
corporations (GOCCs) shall, before making payment on account of each purchase of goods
and services which are subject to the value-added tax imposed in Sections 106 and 108 of
this Code, deduct and withhold a final value-added tax at the rate of five percent (5%) of
the gross payment thereof: Provided, That the payment for lease or use of properties or
property rights to nonresident owners shall be subject to ten percent (10%) withholding tax
at the time of payment. For purposes of this Section, the payor or person in control of the
payment shall be considered as the withholding agent.
The value-added tax withheld under this Section shall be remitted within ten (10)
days following the end of the month the withholding was made.
Section 114(C) merely provides a method of collection, or as stated by respondents, a more

simplified VAT withholding system. The government in this case is constituted as a withholding agent with
respect to their payments for goods and services.
Prior to its amendment, Section 114(C) provided for different rates of value-added taxes to be
withheld -- 3% on gross payments for purchases of goods; 6% on gross payments for services supplied by
contractors other than by public works contractors; 8.5% on gross payments for services supplied by public
work contractors; or 10% on payment for the lease or use of properties or property rights to nonresident
owners. Under the present Section 114(C), these different rates, except for the 10% on lease or property
rights payment to nonresidents, were deleted, and a uniform rate of 5% is applied.
The Court observes, however, that the law the used the word final. In tax usage, final, as opposed
to creditable, means full. Thus, it is provided in Section 114(C): final value-added tax at the rate of five
percent (5%).
In Revenue Regulations No. 02-98, implementing R.A. No. 8424 (The Tax Reform Act of 1997),
the concept of final withholding tax on income was explained, to wit:
SECTION 2.57. Withholding of Tax at Source
(A) Final Withholding Tax. Under the final withholding tax system the amount of
income tax withheld by the withholding agent is constituted as full and final payment of
the income tax due from the payee on the said income. The liability for payment of the tax
rests primarily on the payor as a withholding agent. Thus, in case of his failure to withhold
the tax or in case of underwithholding, the deficiency tax shall be collected from the
payor/withholding agent.
(B) Creditable Withholding Tax. Under the creditable withholding tax system,
taxes withheld on certain income payments are intended to equal or at least approximate
the tax due of the payee on said income. Taxes withheld on income payments covered by
the expanded withholding tax (referred to in Sec. 2.57.2 of these regulations) and
compensation income (referred to in Sec. 2.78 also of these regulations) are creditable in
nature.
As applied to value-added tax, this means that taxable transactions with the government are subject
to a 5% rate, which constitutes as full payment of the tax payable on the transaction. This represents the net
VAT payable of the seller. The other 5% effectively accounts for the standard input VAT (deemed input
VAT), in lieu of the actual input VAT directly or attributable to the taxable transaction.[79]
The Court need not explore the rationale behind the provision. It is clear that Congress intended to
treat differently taxable transactions with the government.[80] This is supported by the fact that under the
old provision, the 5% tax withheld by the government remains creditable against the tax liability of the
seller or contractor, to wit:
SEC. 114. Return and Payment of Value-added Tax.
(C) Withholding of Creditable Value-added Tax. The Government or any of its

political subdivisions, instrumentalities or agencies, including government-owned or
controlled corporations (GOCCs) shall, before making payment on account of each
purchase of goods from sellers and services rendered by contractors which are subject to
the value-added tax imposed in Sections 106 and 108 of this Code, deduct and withhold
the value-added tax due at the rate of three percent (3%) of the gross payment for the
purchase of goods and six percent (6%) on gross receipts for services rendered by
contractors on every sale or installment payment which shall be creditable against the
value-added tax liability of the seller or contractor: Provided, however, That in the case
of government public works contractors, the withholding rate shall be eight and one-half
percent (8.5%): Provided, further, That the payment for lease or use of properties or
property rights to nonresident owners shall be subject to ten percent (10%) withholding tax
at the time of payment. For this purpose, the payor or person in control of the payment shall
be considered as the withholding agent.
The valued-added tax withheld under this Section shall be remitted within ten (10)
days following the end of the month the withholding was made. (Emphasis supplied)
As amended, the use of the word final and the deletion of the word creditable exhibits Congresss
intention to treat transactions with the government differently. Since it has not been shown that the class
subject to the 5% final withholding tax has been unreasonably narrowed, there is no reason to invalidate
the provision. Petitioners, as petroleum dealers, are not the only ones subjected to the 5% final withholding
tax. It applies to all those who deal with the government.
Moreover, the actual input tax is not totally lost or uncreditable, as petitioners believe. Revenue
Regulations No. 14-2005 or the Consolidated Value-Added Tax Regulations 2005 issued by the BIR,
provides that should the actual input tax exceed 5% of gross payments, the excess may form part of the
cost. Equally, should the actual input tax be less than 5%, the difference is treated as income.[81]
Petitioners also argue that by imposing a limitation on the creditable input tax, the government gets
to tax a profit or value-added even if there is no profit or value-added.
Petitioners stance is purely hypothetical, argumentative, and again, one-sided. The Court will not
engage in a legal joust where premises are what ifs, arguments, theoretical and facts, uncertain. Any
disquisition by the Court on this point will only be, as Shakespeare describes life in Macbeth,[82] full of
sound and fury, signifying nothing.
Whats more, petitioners contention assumes the proposition that there is no profit or value-added.
It need not take an astute businessman to know that it is a matter of exception that a business will sell goods
or services without profit or value-added. It cannot be overstressed that a business is created precisely for
profit.
The equal protection clause under the Constitution means that no person or class of persons shall
be deprived of the same protection of laws which is enjoyed by other persons or other classes in the same
place and in like circumstances.
EN BANC
[G.R. No. 132601. October 12, 1998]
LEO ECHEGARAY y PILO, petitioner, vs. THE SECRETARY OF JUSTICE and THE DIRECTOR
OF THE BUREAU OF CORRECTIONS, THE EXECUTIVE JUDGE OF THE REGIONAL
TRIAL COURT OF QUEZON CITY AND THE PRESIDING JUDGE OF REGIONAL
TRIAL COURT OF QUEZON CITY, BRANCH 104, respondents.
DECISION
PER CURIAM:
On June 25, 1996, this Court affirmed[1] the conviction of petitioner Leo Echegaray y Pilo for the crime
of rape of the 10 year-old daughter of his common-law spouse and the imposition upon him of the death
penalty for the said crime.
Petitioner duly filed a Motion for Reconsideration raising mainly factual issues, and on its heels, a
Supplemental Motion for Reconsideration raising for the first time the issue of the constitutionality of
Republic Act No. 7659[2] (the death penalty law) and the imposition of the death penalty for the crime of
rape.
On February 7, 1998, this Court denied[3] petitioner's Motion for Reconsideration and Supplemental
Motion for Reconsideration with a finding that Congress duly complied with the requirements for the
reimposition of the death penalty and therefore the death penalty law is not unconstitutional.
In the meantime, Congress had seen it fit to change the mode of execution of the death penalty from
electrocution to lethal injection,[4] and passed Republic Act No. 8177, AN ACT DESIGNATING DEATH
BY LETHAL INJECTION AS THE METHOD OF CARRYING OUT CAPITAL PUNISHMENT,
AMENDING FOR THE PURPOSE ARTICLE 81 OF THE REVISED PENAL CODE, AS AMENDED
BY SECTION 24 OF REPUBLIC ACT NO. 7659.[5] Pursuant to the provisions of said law, the Secretary
of Justice promulgated the Rules and Regulations to Implement Republic Act No. 8177 ("implementing
rules")[6] and directed the Director of the Bureau of Corrections to prepare the Lethal Injection Manual.[7]
On March 2, 1998, petitioner filed a Petition[8] for Prohibition, Injunction and/or Temporary
Restraining Order to enjoin respondents Secretary of Justice and Director of the Bureau of Prisons from
carrying out the execution by lethal injection of petitioner under R.A. No. 8177 and its implementing rules
as these are unconstitutional and void for being: (a) cruel, degrading and inhuman punishment per seas well
as by reason of its being (b) arbitrary, unreasonable and a violation of due process, (c) a violation of the
Philippines' obligations under international covenants, (d) an undue delegation of legislative power by
Congress, (e) an unlawful exercise by respondent Secretary of the power to legislate, and (f) an unlawful
delegation of delegated powers by the Secretary of Justice to respondent Director.
On March 3, 1998, petitioner, through counsel, filed a Motion for Leave of Court[9] to Amend and
Supplement Petition with the Amended and Supplemental Petition[10] attached thereto, invoking the
additional ground of violation of equal protection, and impleading the Executive Judge of the Regional
Trial Court of Quezon City and the Presiding Judge of the Regional Trial Court, Branch 104, in order to
enjoin said public respondents from acting under the questioned rules by setting a date for petitioner's
execution.
On March 3, 1998, the Court resolved, without giving due course to the petition, to require the
respondents to COMMENT thereon within a non-extendible period of ten (10) days from notice, and
directed the parties "to MAINTAIN the status quo prevailing at the time of the filing of this petition."
On March 10, 1998, the Court granted the Motion for Leave of Court to Amend and Supplement
Petition, and required respondents to COMMENT thereon within ten (10) days from notice.
On March 16, 1998, petitioner filed a Very Urgent Motion (1) To clarify Status Quo Order, and (2)
For the Issuance of a Temporary Restraining Order expressly enjoining public respondents from taking any
action to carry out petitioner's execution until the petition is resolved.
On March 16, 1998, the Office of the Solicitor General [11] filed a Comment (On the Petition and the
Amended Supplemental Petition)[12] stating that (1) this Court has already upheld the constitutionality of
the Death Penalty Law, and has repeatedly declared that the death penalty is not cruel, unjust, excessive or
unusual punishment; (2) execution by lethal injection, as authorized under R.A. No. 8177 and the
questioned rules, is constitutional, lethal injection being the most modern, more humane, more economical,
safer and easier to apply (than electrocution or the gas chamber); (3) the International Covenant on Civil
and Political Rights does not expressly or impliedly prohibit the imposition of the death penalty; (4) R.A.
No. 8177 properly delegated legislative power to respondent Director; and that (5) R.A. No. 8177 confers
the power to promulgate the implementing rules to the Secretary of Justice, Secretary of Health and the
Bureau of Corrections.
On March 17, 1998, the Court required the petitioner to file a REPLY thereto within a non-extendible
period of ten days from notice.
On March 25, 1998, the Commission on Human Rights[13] filed a Motion for Leave of Court to
Intervene and/or Appear as Amicus Curiae[14] with the attached Petition to Intervene and/or Appear
as Amicus Curiae[15] alleging that the death penalty imposed under R.A. No. 7659 which is to be
implemented by R.A. No. 8177 is cruel, degrading and outside the limits of civil society standards, and
further invoking (a) Article II, Section 11 of the Constitution which provides: "The State values the dignity
of every human person and guarantees full respect for human rights."; (b) Article III of the Universal
Declaration of Human Rights which states that "Everyone has the right to life, liberty and security of
person," and Article V thereof, which states that "No one shall be subjected to torture or to cruel, inhuman
or degrading treatment or punishment."; (c) The International Covenant on Civil and Political Rights, in
particular, Article 6 thereof, and the Second Optional Protocol to the International Covenant on Civil and
Political Rights Aiming At The Abolition of the Death Penalty; (d) Amnesty International statistics showing
that as of October 1996, 58 countries have abolished the death penalty for all crimes, 15 countries have
abolished the death penalty for ordinary crimes, and 26 countries are abolitionists de facto, which means
that they have retained the death penalty for ordinary crimes but are considered abolitionists in practice that
they have not executed anyone during the past ten (10) years or more, or in that they have made an
international commitment not to carry out executions, for a total of 99 countries which are total abolitionists
in law or practice, and 95 countries as retentionists;[16] and (e) Pope John Paul II's encyclical, "Evangelium
Vitae." In a Resolution dated April 3, 1998, the Court duly noted the motion.
On March 27, 1998, petitioner filed a Reply[17] stating that (1) this Court is not barred from exercising
judicial review over the death penalty per se, the death penalty for rape and lethal injection as a mode of
carrying out the death penalty; (2) capital punishment is a cruel, degrading and inhuman punishment; (3)
lethal injection is cruel, degrading and inhuman punishment, and that being the "most modern" does not
make it less cruel or more humane, and that the Solicitor General's "aesthetic" criteria is short-sighted, and
that the lethal injection is not risk free nor is it easier to implement; and (4) the death penalty violates
the International Covenant on Civil and Political Rights considering that the Philippines participated in the
deliberations of and voted for the Second Optional Protocol.
After deliberating on the pleadings, the Court gave due course to the petition, which it now resolves
on the merits.
In the Amended and Supplemental Petition, petitioner assails the constitutionality of the mode of
carrying out his death sentence by lethal injection on the following grounds:[18]
I.
DEATH BY LETHAL INJECTION IS UNCONSTITUTIONAL FOR BEING A CRUEL,

DEGRADING AND INHUMAN PUNISHMENT.
II.
THE DEATH PENALTY VIOLATES THE INTERNATIONAL COVENANT ON CIVIL

AND POLITICAL RIGHTS, WHICH IS PART OF THE LAW OF THE LAND.
III.
LETHAL INJECTION, AS AUTHORIZED UNDER REPUBLIC ACT NO. 8177 AND THE
QUESTIONED RULES, IS UNCONSTITUTIONAL BECAUSE IT IS AN UNNECESSARY
AND WANTON INFLICTION OF PAIN ON A PERSON AND IS, THUS, A CRUEL,
DEGRADING, AND INHUMAN PUNISHMENT.
IV.
REPUBLIC ACT NO. 8177 UNDULY DELEGATES LEGISLATIVE POWER TO

RESPONDENT DIRECTOR.
V.
RESPONDENT SECRETARY UNLAWFULLY DELEGATED THE LEGISLATIVE

POWERS DELEGATED TO HIM UNDER REPUBLIC ACT NO. 8177 TO RESPONDENT
DIRECTOR.
VI.
RESPONDENT SECRETARY EXCEEDED THE AUTHORITY DELEGATED TO HIM

UNDER REPUBLIC ACT NO. 8177 AND UNLAWFULLY USURPED THE POWER TO
LEGISLATE IN PROMULGATING THE QUESTIONED RULES.
VII.
SECTION 17 OF THE QUESTIONED RULES IS UNCONSTITUTIONAL FOR BEING

DISCRIMINATORY AS WELL AS FOR BEING AN INVALID EXERCISE BY
RESPONDENT SECRETARY OF THE POWER TO LEGISLATE.
VIII.
INJUCTION MUST ISSUE TO PREVENT IRREPARABLE DAMAGE AND INJURY TO

PETITIONER'S RIGHTS BY REASON OF THE EXISTENCE, OPERATION AND
IMPLEMENTATION OF AN UNCONSTITUTIONAL STATUTE AND EQUALLY
INVALID AND IMPLEMENTING RULES.
Concisely put, petitioner argues that R.A. No. 8177 and its implementing rules do not pass
constitutional muster for: (a) violation of the constitutional proscription against cruel, degrading or inhuman
punishment, (b) violation of our international treaty obligations, (c) being an undue delegation of legislative
power, and (d) being discriminatory.
The Court shall now proceed to discuss these issues in seriatim.
I. LETHAL INJECTION, NOT CRUEL, DEGRADING OR INHUMAN PUNISHMENT UNDER
SECTION 19, ARTICLE III OF THE 1987 CONSTITUTION.
The main challenge to R.A. 8177 and its implementing rules is anchored on Article III, Section 19 (1)
of the 1987 Constitution which proscribes the imposition of "cruel, degrading or inhuman"
punishment. "The prohibition in the Philippine Bill against cruel and unusual punishments is an Anglo-
Saxon safeguard against governmental oppression of the subject, which made its first appearance in the
reign of William and Mary of England in 'An Act declaring the rights and liberties of the subject, and
settling the succession of the crown,' passed in the year 1689. It has been incorporated into the Constitution
of the United States (of America) and into most constitutions of the various States in substantially the same
language as that used in the original statute. The exact language of the Constitution of the United States is
used in the Philippine Bill."[19] "The counterpart of Section 19 (1) in the 1935 Constitution reads: 'Excessive
fines shall not be imposed, nor cruel and inhuman punishment inflicted.' xxx In the 1973 Constitution the
phrase became 'cruel or unusual punishment.' The Bill of Rights Committee of the 1986 Constitutional
Commission read the 1973 modification as prohibiting 'unusual' punishment even if not 'cruel.' It was thus
seen as an obstacle to experimentation in penology. Consequently, the Committee reported out the present
text which prohibits 'cruel, degrading or inhuman punishment' as more consonant with the meaning desired
and with jurisprudence on the subject."[20]
Petitioner contends that death by lethal injection constitutes cruel, degrading and inhuman punishment
considering that (1) R.A. No. 8177 fails to provide for the drugs to be used in carrying out lethal injection,
the dosage for each drug to be administered, and the procedure in administering said drug/s into the accused;
(2) R.A. No. 8177 and its implementing rules are uncertain as to the date of the execution, time of
notification, the court which will fix the date of execution, which uncertainties cause the greatest pain and
suffering for the convict; and (3) the possibility of "botched executions" or mistakes in administering the
drugs renders lethal injection inherently cruel.
Before the Court proceeds any further, a brief explanation of the process of administering lethal
injection is in order.
In lethal injection, the condemned inmate is strapped on a hospital gurney and wheeled into the
execution room. A trained technician inserts a needle into a vein in the inmate's arm and begins an
intravenous flow of saline solution. At the warden's signal, a lethal combination of drugs is injected into
the intravenous line. The deadly concoction typically includes three drugs: (1) a nonlethal dose of sodium
thiopenthotal, a sleep inducing barbiturate; (2) lethal doses of pancuronium bromide, a drug that paralyzes
the muscles; and (3) potassium chloride, which stops the heart within seconds. The first two drugs are
commonly used during surgery to put the patient to sleep and relax muscles; the third is used in heart bypass
surgery.[21]
Now it is well-settled in jurisprudence that the death penalty per se is not a cruel, degrading or inhuman
punishment.[22] In the oft-cited case of Harden v. Director of Prisons,[23] this Court held that "[p]unishments
are cruel when they involve torture or a lingering death; but the punishment of death is not cruel, within the
meaning of that word as used in the constitution. It implies there something inhuman and barbarous,
something more than the mere extinguishment of life." Would the lack in particularity then as to the details
involved in the execution by lethal injection render said law "cruel, degrading or inhuman"? The Court
believes not. For reasons hereafter discussed, the implementing details of R.A. No. 8177 are matters which
are properly left to the competence and expertise of administrative officials.[24]
Petitioner contends that Sec. 16[25] of R.A. No. 8177 is uncertain as to which "court" will fix the time
and date of execution, and the date of execution and time of notification of the death convict. As petitioner
already knows, the "court" which designates the date of execution is the trial court which convicted the
accused, that is, after this Court has reviewed the entire records of the case[26] and has affirmed the judgment
of the lower court. Thereupon, the procedure is that the "judgment is entered fifteen (15) days after its
promulgation, and 10 days thereafter, the records are remanded to the court below including a certified
copy of the judgment for execution.[27] Neither is there any uncertainty as to the date of execution nor the
time of notification. As to the date of execution, Section 15 of the implementing rules must be read in
conjunction with the last sentence of Section 1 of R.A. No. 8177 which provides that the death sentence
shall be carried out "not earlier than one (1) year nor later then eighteen (18) months from the time the
judgment imposing the death penalty became final and executory, without prejudice to the exercise by the
President of his executive clemency powers at all times." Hence, the death convict is in effect assured of
eighteen (18) months from the time the judgment imposing the death penalty became final and
executory[28] wherein he can seek executive clemency[29] and attend to all his temporal and spiritual
affairs.[30]
Petitioner further contends that the infliction of "wanton pain" in case of possible complications in the
intravenous injection, considering and as petitioner claims, that respondent Director is an untrained and
untested person insofar as the choice and administration of lethal injection is concerned, renders lethal
injection a cruel, degrading and inhuman punishment. Such supposition is highly speculative and
unsubstantiated.
First. Petitioner has neither alleged nor presented evidence that lethal injection required the expertise
only of phlebotomists and not trained personnel and that the drugs to be administered are unsafe or
ineffective.[31] Petitioner simply cites situations in the United States wherein execution by lethal injection
allegedly resulted in prolonged and agonizing death for the convict,[32] without any other evidence
whatsoever.
Second. Petitioner overlooked Section 1, third paragraph of R.A. No. 8177 which requires that all
personnel involved in the execution proceedings should be trained prior to the performance of such task.We
must presume that the public officials entrusted with the implementation of the death penalty (by lethal
injection) will carefully avoid inflicting cruel punishment.[33]
Third. Any infliction of pain in lethal injection is merely incidental in carrying out the execution of
death penalty and does not fall within the constitutional proscription against cruel, degrading and inhuman
punishment. "In a limited sense, anything is cruel which is calculated to give pain or distress, and since
punishment imports pain or suffering to the convict, it may be said that all punishments are cruel. But of
course the Constitution does not mean that crime, for this reason, is to go unpunished." [34] The cruelty
against which the Constitution protects a convicted man is cruelty inherent in the method of punishment,
not the necessary suffering involved in any method employed to extinguish life humanely. [35] Numerous
federal and state courts of the United States have been asked to review whether lethal injections constitute
cruel and unusual punishment. No court has found lethal injections to implicate prisoner's Eighth
Amendment rights. In fact, most courts that have addressed the issue state in one or two sentences that
lethal injection clearly is a constitutional form of execution.[36] A few jurisdictions, however, have
addressed the merits of the Eighth Amendment claims. Without exception, these courts have found that
lethal injection does not constitute cruel and unusual punishment. After reviewing the medical evidence
that indicates that improper doses or improper administration of the drugs causes severe pain and that prison
officials tend to have little training in the administration of the drugs, the courts have found that the few
minutes of pain does not rise to a constitutional violation.[37]
What is cruel and unusual "is not fastened to the obsolete but may acquire meaning as public opinion
becomes enlightened by a humane justice" and "must draw its meaning from the evolving standards of
decency that mark the progress of a maturing society."[38] Indeed, "[o]ther (U.S.) courts have focused on
'standards of decency' finding that the widespread use of lethal injections indicates that it comports with
contemporary norms."[39] the primary indicator of society's standard of decency with regard to capital
punishment is the response of the country's legislatures to the sanction.[40] Hence, for as long as the death
penalty remains in our statute books and meets the most stringent requirements provided by the
Constitution, we must confine our inquiry to the legality of R.A. No. 8177, whose constitutionality we duly
sustain in the face of petitioner's challenge. We find that the legislature's substitution of the mode of
carrying out the death penalty from electrocution to lethal injection infringes no constitutional rights of
petitioner herein.
II. REIMPOSITION OF THE DEATH PENALTY LAW DOES NOT VIOLATE INTERNATIONAL
TREATY OBLIGATIONS
Petitioner assiduously argues that the reimposition of the death penalty law violates our international
obligations, in particular, the International Covenant on Civil And Political Rights, which was adopted by
the General Assembly of the United Nations on December 16, 1996, signed and ratified by the Philippines
on December 19, 1966 and October 23, 1986,[41] respectively.
Article 6 of the International Covenant on Civil and Political Rights provides:
"1. Every human being has the inherent right to life. This right shall be protected by law. No one shall be
arbitrarily deprived of his life.
2. In countries which have not abolished the death penalty, sentence of death may be imposed only for
the most serious crimes in accordance with the law in force at the time of the commission of the crime
and not contrary to the provisions of the present Covenant and to the Convention on the Prevention and
Punishment of the Crime of Genocide. This penalty can only be carried out pursuant to a final judgment
rendered by a competent court." (emphasis supplied)
3. When deprivation of life constitutes the crime of genocide, it is understood that nothing in this article
shall authorize any State Party to the present Covenant to derogate in any way from any obligation
assumed under the provisions of the Convention on the Prevention and Punishment of the Crime of
Genocide.
4. Anyone sentenced to death shall have the right to seek pardon or commutation of the
sentence. Amnesty, pardon or commutation of the sentence of death may be granted in all-cases.
5. Sentence of death shall not be imposed for crimes committed by persons below eighteen years of age
and shall not be carried out on pregnant women.
6. Nothing in this article shall be invoked to delay or to prevent the abolition of capital punishment by
any State. Party to the present Covenant."
Indisputably, Article 6 of the Covenant enshrines the individual's right to life. Nevertheless, Article 6
(2) of the Covenant explicitly recognizes that capital punishment is an allowable limitation on the right to
life, subject to the limitation that it be imposed for the "most serious crimes". Pursuant to Article 28 of
the Covenant, a Human Rights Committee was established and under Article 40 of the Covenant, State
parties to the Covenant are required to submit an initial report to the Committee on the measures they have
adopted which give effect to the rights recognized within the Covenant and on the progress made on the
enjoyment of those rights one year of its entry into force for the State Party concerned and thereafter, after
five years. On July 27, 1982, the Human Rights Committee issued General Comment No. 6 interpreting
Article 6 of the Covenant stating that "(while) it follows from Article 6 (2) to (6) that State parties are not
obliged to abolish the death penalty totally, they are obliged to limit its use and, in particular, to abolish it
for other than the 'most serious crimes.' Accordingly, they ought to consider reviewing their criminal laws
in this light and, in any event, are obliged to restrict the application of the death penalty to the most serious
crimes.' The article strongly suggests (pars. 2 (2) and (6) that abolition is desirable. xxx The Committee is
of the opinion that the expression 'most serious crimes' must be read restrictively to mean that the death
penalty should be a quite exceptional measure." Further, the Safeguards Guaranteeing Protection of Those
Facing the Death Penalty[42] adopted by the Economic and Social Council of the United Nations declare
that the ambit of the term 'most serious crimes' should not go beyond intentional crimes, with lethal or other
extremely grave consequences.
The Optional Protocol to the International Covenant on Civil and Political Rights was adopted by the
General Assembly of the United Nations on December 16, 1966, and signed and ratified by the Philippines
on December 19, 1966 and August 22, 1989,[43] respectively. The Optional Protocol provides that the
Human Rights Committee shall receive and consider communications from individuals claiming to be
victims of violations of any of the rights set forth in the Covenant.
On the other hand, the Second Optional Protocol to the International Covenant on Civil and Political
Rights, Aiming at the Abolition of the Death Penalty was adopted by the General Assembly on December
15, 1989. The Philippines neither signed nor ratified said document.[44] Evidently, petitioner's assertion
of our obligation under the Second Optional Protocol is misplaced.
III. THERE IS NO UNDUE DELEGATION OF LEGISLATIVE POWER IN R.A. NO. 8177 TO
THE SECRETARY OF JUSTICE AND THE DIRECTOR OF BUREAU OF CORRECTIONS,
BUT SECTION 19 OF THE RULES AND REGULATIONS TO IMPLEMENT R.A. NO. 8177
IS INVALID.
The separation of powers is a fundamental principle in our system of government. It obtains not
through express provision but by actual division in the framing of our Constitution. Each department of the
government has exclusive cognizance of matters placed within its jurisdiction, and is supreme within its
own sphere.[45] Corollary to the doctrine of separation of powers is the principle of non-delegation of
powers. "The rule is that what has been delegated, cannot be delegated or as expressed in a Latin
maxim: potestas delegata non delegari potest."[46] The recognized exceptions to the rule are as follows:
(1) Delegation of tariff powers to the President under Section 28 (2) of Article VI of the
Constitution;
(2) Delegation of emergency powers to the President under Section 23 (2) of Article VI of the
Constitution;
(5) Delegation to administrative bodies.[47]
Empowering the Secretary of Justice in conjunction with the Secretary of Health and the Director of
the Bureau of Corrections, to promulgate rules and regulations on the subject of lethal injection is a form
of delegation of legislative authority to administrative bodies.
The reason for delegation of authority to administrative agencies is the increasing complexity of the
task of government requiring expertise as well as the growing inability of the legislature to cope directly
with the myriad problems demanding its attention. The growth of society has ramified its activities and
created peculiar and sophisticated problems that the legislature cannot be expected to attend to by
itself. Specialization even in legislation has become necessary. On many problems involving day-to-day
undertakings, the legislature may not have the needed competence to provide the required direct and
efficacious, not to say, specific solutions. These solutions may, however, be expected from its delegates,
who are supposed to be experts in the particular fields assigned to them.[48]
Although Congress may delegate to another branch of the Government the power to fill in the details
in the execution, enforcement or administration of a law, it is essential, to forestall a violation of the
principle of separation of powers, that said law: (a) be complete in itself - it must set forth therein the policy
to be executed, carried out or implemented by the delegate[49] - and (b) fix a standard - the limits of which
are sufficiently determinate or determinable - to which the delegate must conform in the performance of
his functions.[50]
Considering the scope and the definiteness of R.A. No. 8177, which changed the mode of carrying out
the death penalty, the Court finds that the law sufficiently describes what job must be done, who is to do it,
and what is the scope of his authority.[51]
R.A. No. 8177 likewise provides the standards which define the legislative policy, mark its limits, map
out its boundaries, and specify the public agencies which will apply it. it indicates the circumstances under
which the legislative purpose may be carried out.[52] R.A. No. 8177 specifically requires that "[t]he death
sentence shall be executed under the authority of the Director of the Bureau of Corrections, endeavoring
so far as possible to mitigate the sufferings of the person under the sentence during the lethal injection
as well as during the proceedings prior to the execution."[53] Further, "[t]he Director of the Bureau of
Corrections shall take steps to ensure that the lethal injection to be administered is sufficient to cause
the instantaneous death of the convict."[54] The legislature also mandated that "all personnel involved in
the administration of lethal injection shall be trained prior to the performance of such task."[55] The
Court cannot see that any useful purpose would be served by requiring greater detail.[56] The question raised
is not the definition of what constitutes a criminal offense,[57] but the mode of carrying out the penalty
already imposed by the Courts. In this sense, R.A. No. 8177 is sufficiently definite and the exercise of
discretion by the administrative officials concerned is, to use the words of Justice Benjamin Cardozo,
canalized within banks that keep it from overflowing.
Thus, the Court finds that the existence of an area for exercise of discretion by the Secretary of Justice
and the Director of the Bureau of Corrections under delegated legislative power is proper where standards
are formulated for the guidance and the exercise of limited discretion, which though general, are capable
of reasonable application.[58]
It is also noteworthy that Article 81 of the Revised Penal Code which originally provided for the death
penalty by electrocution was not subjected to attack on the ground that it failed to provide for details such
as the kind of chair to be used, the amount of voltage, volume of amperage or place of attachment of
electrodes on the death convict. Hence, petitioner's analogous argument with respect to lethal injection must
fail.
A careful reading of R.A. No. 8177 would show that there is no undue delegation of legislative power
from the Secretary of Justice to the Director of the Bureau of Corrections for the simple reason that under
the Administrative Code of 1987, the Bureau of Corrections is a mere constituent unit of the Department
of Justice.[59] Further, the Department of Justice is tasked, among others, to take charge of the
"administration of the correctional system."[60] Hence, the import of the phraseology of the law is that the
Secretary of Justice should supervise the Director of the Bureau of Corrections in promulgating the Lethal
Injection Manual, in consultation with the Department of Health.[61]
However, the Rules and Regulations to Implement Republic Act No. 8177 suffer serious flaws that
could not be overlooked. To begin with, something basic appears missing in Section 19 of the implementing
rules which provides:
"SEC. 19. EXECUTION PROCEDURE. - Details of the procedure prior to, during and after
administering the lethal injection shall be set forth in a manual to be prepared by the Director. The
manual shall contain details of, among others, the sequence of events before and after execution;
procedures in setting up the intravenous line; the administration of the lethal drugs; the
pronouncement of death; and the removal of the intravenous system.
Said manual shall be confidential and its distribution shall be limited to authorized prison
personnel."
Thus, the Courts finds in the first paragraph of Section 19 of the implementing rules a veritable
vacuum. The Secretary of Justice has practically abdicated the power to promulgate the manual on the
execution procedure to the Director of the Bureau of Corrections, by not providing for a mode of review
and approval thereof. Being a mere constituent unit of the Department of Justice, the Bureau of Corrections
could not promulgate a manual that would not bear the imprimatur of the administrative superior, the
Secretary of Justice as the rule-making authority under R.A. No. 8177. Such apparent abdication of
departmental responsibility renders the said paragraph invalid.
As to the second paragraph of section 19, the Court finds the requirement of confidentiality of the
contents of the manual even with respect to the convict unduly suppressive. It sees no legal impediment for
the convict, should he so desire, to obtain a copy of the manual. The contents of the manual are matters of
public concern "which the public may want to know, either because these directly affect their lives, or
simply because such matters naturally arouse the interest of an ordinary citizen."[62] Section 7 of Article III
of the 1987 Constitution provides:
"SEC. 7. The right of the people to information on matters of public concern shall be
recognized. Access to official records, and to documents and papers pertaining to official acts,
transaction, or decisions, as well as to government research data used as a basis for policy
development, shall be afforded the citizen, subject to such limitation as may be provided by law."
The incorporation in the Constitution of a guarantee of access to information of public concern is a
recognition of the essentiality of the free flow of ideas and information in a democracy.[63] In the same way
that free discussion enables members of society to cope with the exigencies of their time, [64] access to
information of general interest aids the people in democratic decision-making[65] by giving them a better
perspective of the vital issues confronting the nation.[66]
D. SECTION 17 OF THE RULES AND REGULATIONS TO IMPLEMENT R.A. NO. 8177 IS
INVALID FOR BEING DISCRIMINATORY AND CONTRARY TO LAW.
Even more seriously flawed than Section 19 is Section of the implementing rules which provides:
"SEC. 17. SUSPENSION OF THE EXECUTION OF THE DEATH SENTENCE. Execution

by lethal injection shall not be inflicted upon a woman within the three years next following the date
of the sentence or while she is pregnant, nor upon any person over seventy (70) years of age. In this
latter case, the death penalty shall be commuted to the penalty of reclusion perpetua with the
accessory penalties provided in Article 40 of the Revised Penal Code."
Petitioner contends that Section 17 is unconstitutional for being discriminatory as well as for being an
invalid exercise of the power to legislate by respondent Secretary. Petitioner insists that Section 17 amends
the instances when lethal injection may be suspended, without an express amendment of Article 83 of the
Revised Penal Code, as amended by section 25 of R.A. No. 7659.
Article 83 f the Revised Penal Code, as amended by section 25 of R.A. No. 7659 now reads as follows:
"ART. 83, Suspension of the execution of the death sentence.- The death sentence shall not be
inflicted upon a woman while she is pregnant or within one (1) year after delivery, nor upon any
person over seventy years of age. In this last case, the death sentence shall be commuted to the
penalty of reclusion perpetua with the accessory penalty provided in Article 40. x x x".
On this point, the Courts finds petitioner's contention impressed with merit. While Article 83 of the
Revised Penal Code, as amended by Section 25 of Republic Act No. 7659, suspends the implementation of
the death penalty while a woman is pregnant or within one (1) year after delivery, Section 17 of the
implementing rules omits the one (1) year period following delivery as an instance when the death sentence
is suspended, and adds a ground for suspension of sentence no longer found under Article 83 of the Revised
Penal Code as amended, which is the three-year reprieve after a woman is sentenced. This addition is, in
petitioner's view, tantamount to a gender-based discrimination sans statutory basis, while the omission is
an impermissible contravention of the applicable law.
Being merely an implementing rule, Section 17 aforecited must not override, but instead remain
consistent and in harmony with the law it seeks to apply and implement. Administrative rules and
regulations are intended to carry out, neither to supplant nor to modify, the law." [67] An administrative
agency cannot amend an act of Congress.[68] In case of discrepancy between a provision of statute and a
rule or regulation issued to implement said statute, the statutory provision prevails. Since the cited clause
in Section 17 which suspends the execution of a woman within the three (3) years next following the date
of sentence finds no supports in Article 83 of the Revised Penal Code as amended, perforce Section 17 must
be declared invalid.
One member of the Court voted to declare Republic Act. No. 8177 as unconstitutional insofar as it
delegates the power to make rules over the same subject matter to two persons (the Secretary of Justice and
the Director of the Bureau of Corrections) and constitutes a violation of the international norm towards the
abolition of the death penalty. One member of the Court, consistent with his view in People v. Echegaray,
267 SCRA 682, 734-758 (1997) that the death penalty law (Republic Act. No. 7659) is itself
unconstitutional, believes that Republic Act No. 8177 which provides for the means of carrying out the
death sentence, is likewise unconstitutional. Two other members of the court concurred in the aforesaid
Separate Opinions in that the death penalty law (Republic Act No. 7659) together with the assailed statute
(Republic Act No. 8177) are unconstitutional. In sum, four members of the Court voted to declare Republic
Act. No. 8177 as unconstitutional. These Separate Opinions are hereto annexed, infra.
WHEREFORE, the petition is DENIED insofar as petitioner seeks to declare the assailed statute
(Republic Act No. 8177) as unconstitutional; but GRANTED insofar as Sections 17 and 19 of the Rules
and Regulations to Implement Republic Act No. 8177 are concerned, which are hereby
declared INVALID because (a) Section 17 contravenes Article 83 of the Revised Penal Code, as amended
by Section 25 of the Republic Act No. 7659; and (b) Section 19 fails to provide for review and approval of
the Lethal Injection Manual by the Secretary of Justice, and unjustifiably makes the manual confidential,
hence unavailable to interested parties including the accused/convict and counsel. Respondents are hereby
enjoined from enforcing and implementing Republic Act No. 8177 until the aforesaid Sections 17 and 19
of the Rules and Regulations to Implement Republic Act No. 8177 are appropriately amended, revised
and/or corrected in accordance with this Decision.
NO COSTS.
SO ORDERED.
Regalado, Davide, Jr., Romero, Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza, Panganiban,
Martinez, Quisumbing and Purisima, JJ., concur.
Narvasa, C.J., On official leave
Pardo, J., No part.
See Per Curiams Dissenting Opinion A and B
[1]
People v. Echegaray, G.R. No. 117472, 257 SCRA 561 [1996]. The lower Court decision was penned by
Judge Maximiano C. Asuncion.
[2]
AN ACT TO IMPOSE THE DEATH PENALTY ON CERTAIN HEINOUS CRIMES, AMENDING
FOR THAT PURPOSE THE REVISED PENAL CODE, AS AMENDED, OTHER SPECIAL LAWS,
AND FOR OTHER PURPOSES, which took effect on December 31, 1993; People v. Simon, 234 SCRA
555, 569 [1994].
[3]
People v. Echegaray, G.R. No. 117472, 267 SCRA 682 [1997].
[4]
Records of the Senate, October 5, 1995, p. 48. Senator Ernesto F. Herrera explained that: "The present
prescribed method in carrying out capital punishment is death by electrocution. This will later be changed
to gas poisoning, as provided by Sec. 24 of R.A. No. 7659, as soon as the Bureau of Corrections can have
the proper facilities for the purpose.
There would not have been any problem had the old electric chair been saved from fire in the New Bilibid
Prison that totally destroyed it. Without an electric chair or gas chamber, our penal system today has no
means of implementing the death sentence. The very high cost needed for the replacement of the electric
chair and the building of a gas chamber bogs down the whole process. This is, indeed, the appropriate time
to introduce lethal injection as a new means of carrying out the death penalty. This method is less expensive,
more humane, easier to administer and conveniently more portable."
[5]
Published in the Manila Times on March 23, 1996.
[6]
Published in the Philippine Star on May 23, 1998.
[7]
RULES AND REGULATIONS TO IMPLEMENT R.A. NO. 8177, Section 19.
[8]
Rollo, p. 3.
[9]
Rollo, p. 49.
[10]
Rollo, p. 51.
[11]
Through then Solicitor-General Romeo C. de la Cruz, Assistant Solicitors-General Pio C. Guerrero and
Antonio G. Castro, and Solicitor-General Evelyn C. Balgos-Guballa.
[12]
Rollo, p. 102.
[13]
Through Commissioner Jorge R. Coquia and Director Emmanuel C. Neri.
[14]
Rollo, p. 129.
[15]
Rollo, p. 136.
[16]
Annex "A" to the Petition to Intervene and/or Appear as Amicus Curiae, Rollo, p. 151.
[17]
Rollo, p. 157.
[18]
Amended and Supplemental Petition, Rollo, pp. 55-81.
[19]
U.S. v. Borromeo, 23 Phil, 285-286 [1912].
[20]
Bernas, J., The 1987 Constitution of the Republic of the Philippines, A Commentary, 1996 ed., p., 501;
I RECORD 707-8.
[21]
Comment of the Solicitor-General, Rollo, p. 115; Rules and Regulations to Implement Republic Act No.
8177, Sections 2(b), 15, 20-22; Bureau of Corrections Lethal Injection Manual, pp. 13-22.
[22]
People v. Echegaray, 267 SCRA 682, 694 [1997]; People v. Marcos, 147 SCRA 204, 216
[1987]; People v. Puda, 133 SCRA 1, 13 [1984]; People v. Camano, 115 SCRA 688, 702 [1982]; Harden
v. Director of Prisons, 81 Phil. 741, 747 [1948].
[23]
81 Phil. At 747, citing In Ex Parte Kemmler, 136 U.S. 436.
[24]
Records of the Senate, January 29, 1996, pp. 15, 13:
Senator Macapagal. I notice that the bill does not specify exactly what drug, chemical, or combination of
drug and chemical is to be administered. Is my impression correct, Mr. President?
Senator Maceda. Yes, Mr. President. Precisely, those are the kinds of details that are better left to the
Executive department to implement by administrative regulation. (emphasis supplied)
Senator Macapagal. Therefore, it would be up to the Director of the Bureau of Corrections to choose the
drugs or chemicals to be used. Is that correct, Mr. President?
Senator Maceda. I would think this is a matter that would be initiated by the Director of the Bureau of
Corrections. But following established procedure, it will have to be with the approval of the Secretary of
Justice.
xxx
Senator Macapagal. And as far as the procedure is concerned, the bill does not also state exactly how the
execution is to be carried out, or the procedure to be used. Is there no intention or would it not be more
pragmatic for the law to provide the procedure to be undertaken in carrying out the execution in order to
lessen the possibility of negligence during the actual execution?
Senator Maceda. We felt, Mr. President, that when it comes to the details of the procedure, it would be
better to leave it to administrative regulation. After all, the main import of the law really is to change
the method of execution from the "electric chair" to "lethal injection." (emphasis supplied)
[25]
Sec. 16. NOTIFICATION AND EXECUTION OF THE SENTENCE AND ASSISTANCE TO THE
CONVICT. - The court shall designate a working day for the execution of the death penalty but not the
hour thereof. Such designation shall only be communicated to the convict after sunrise of the day of the
execution, and the execution shall not take place until after the expiration of at least eight (8) hours
following the notification, but before sunset. - During the interval between the notification and execution,
the convict shall, as far as possible, be furnished such assistance as he may request in order to be attended
in his last moments by a priest or minister of the religion he professes and to consult his lawyers, as well as
in order to make a will and confer with members of his family or of persons in charge of the management
of his business, of the administration of his property, or of the care of his descendants.
[26]
As mandated by Article VIII Section 5 (2) (d) of the 1987 Constitution, and Section 3 (e) of Rule 122,
Rules on Criminal Procedure.
[27]
Sections 10 and 11 of Rule 51 of the 1997 Rules of Civil Procedure in relation to Section 17 of Rule
124 of the Rules on Criminal Procedure.
[28]
In G.R. No. 117472, we issued an en banc resolution dated September 2, 1997, wherein we held that:
"xxx In criminal cases, Section 7 of Rule 120 of the Rules on Criminal Procedure states the circumstances
when a judgment becomes final.However, we cannot specifically apply these tenets to judgments imposing
the death penalty which is imposed or affirmed by this Court itself since, obviously, no appeal lies
therefrom. Thus, it is only but proper that a judgment of this Court imposing the death sentence becomes
final and executory after the expiration of fifteen (15) days from service of a copy thereof on counsel of the
accused-appellant, or on the latter if so ordered by this Court, and no motion for reconsideration or, where
allowed by this Court, a motion for new trial [see Helmuth, Jr. v. People, 112 SCRA 573 [1982]; People v.
Amparado, 156 SCRA 712 [1987]] has been filed by accused-appellant, or no ground has supervened
which would justifiably interrupt or warrant the suspension of the running of the reglementary period for
finality. Where a motion for reconsideration has been filed and denied, the finality of such resolution shall
be substantially subject to the same rule." Records, pp. 308-309.
[29]
Records of the Senate, January 29, 1996, pp. 8-9.:
Senator Drilon. xxx [O]n page 2 of Senate Bill No. 436, it is provided here that the death sentence shall
be carried out not later than one year after the judgment has become final. I would just like to get a
confirmation from the distinguished Sponsor if this provision will not in any way interfere with or diminish
the constitutional power of the President to reduce or commute or grant pardon to convicts who are
sentenced to death through lethal injection as provided under this bill.
Senator Maceda. No, Mr. President, it would not diminish the power of the President. I would express the
view at this time that while we hope that the President will make such judgment within the one-year period,
I would take the view that if within the one-year period or near the end of the expiration of the one-year
period he were to issue a suspension or commutation, then certainly the constitutional power lodged in him
cannot be diminished by legislation.
Senator Drilon. Can the President commute a death penalty to life imprisonment after one year, from the
time the judgment has become final?
Senator Maceda. I would say that as long as the convict is not yet dead or executed, then the President still
retains that power.
[30]
RULES AND REGULATIONS TO IMPLEMENT R.A. NO. 8177, Sections 4, 6-9 provide
Sec. 4. PRISON SERVICES. - Subject to the availability of resources, a death convict shall enjoy the
following services and privileges to encourage and enhance his self-respect and dignity:
a. Medical and Dental;
b. Religious, Guidance and Counselling;
c. Exercise;
d. Visitation; and
e. Mail.
xxx
Sec. 6. RELIGIOUS SERVICES. - Subject to security conditions, a death convict may be visited by the
priest or minister of his faith and given such available religious materials which he may require.
Sec. 7. EXERCISE. - A death convict shall be allowed to enjoy regular exercise periods under the
supervision of a guard.
Sec. 8. MEAL SERVICES.- Meals shall, whenever practicable, be served individually to a death convict
outside his cell. Mess utensils shall be made of plastic. After each meal, said utensils shall be collected and
accounted.
Sec. 9. VISITATION. - A death convict shall be allowed to be visited by his immediate family and
reputable friends at regular intervals and during designated hours subject to security procedures.
In addition, Article 82 of the Revised Penal Code provides: "xxx During the interval between the
notification and the execution, the culprit shall, in so far as possible, be furnished such assistance as he may
request in order to be attended in his last moments by priests or ministers of the religion he professes and
to consult lawyers, as well as in order to make a will and confer with members of his family or persons in
charge of the management of his business, of the administration of his property, or of the care of his
descendants."
[31]
See Woolls v. McCotter, 798 F.2d 695, 698 (5TH Cir. 1986), wherein the U.S. Court of Appeals held
that "First, the appellant has not even alleged, much less produced any evidence, that the Texas Department
of Corrections allows anyone other than trained medical personnel to administer lethal injections. Second,
the appellant has neither alleged nor produced evidence that would indicate that improper dosages of
sodium thiopental have been or will be administered so as to result in physical or mental pain. Finally, even
if the physical and mental manifestations noted by Dr. Hodes were experienced by an individual, this
showing "of discomfort or unnecessary pain" falls far short of the showing found insufficient in Gray v.
Lucas, [710 f2d. 1048, 1057-61 (5TH Cir.), cert. Denied, 463 U.S. 1237, 104 S. Ct. 211, 77 L.Ed. 2d 1453
(1983)]." O'Bryan, 729 F.2d at 994. Woolls has failed to make a substantial showing of the denial of his
right to be free from cruel and unusual punishment under the eighth amendment."
[32]
Amended and Supplemental Petition, Rollo, pp. 65-67.
[33]
See State of Nevada v. Gee Jon, 46 Nev. 418, 211 P. 676, 682, 30 A.L.R. 1443, 1450-1451 [1923].
[34]
American Law Reports, Annotated, 30 A.L.R. 1452 at 1453.
[35]
Ex Parte Granviel, 561 S.W. 2d 503, 509 [1978], citing Lousiana ex. rel. Francis v. Resweber, 329 U.S.
459, 464, 67 S. Ct. 374, 376, 91 L.Ed. 422 (1947).
[36]
19 Thomas Jefferson Law Review (Spring 1997), 1-38, at 31-32., citing Kelly v. Lynaugh, 862 F. 2d
1126, 1135 (5TH Cir., 1988) ("Finally, Kelly argues against lethal injection as a method of execution,
arguing that it is cruel and unusual punishment, especially when administered by an unqualified
person. Again, "[w]e have rejected this argument"); O' Bryan v. McKaskle, 729 F.2d 991, 994 (5TH Cir.
1984) ("[w]e agree with the state that the showing made by O'Bryan of discomfort or unnecessary pain falls
short of the showing found insufficient in Gray v. Lucas"); Silagy v. Peters, 713 F.Supp. 1246, 1258 (C.D.
III, 1989 ("The petitioner claims that lethal injection is cruel and unusual punishment. There is nothing in
the record that supports that contention."); State v. Moen, 786 P.2d. 111, 143 (Ore. 1990); Hopkinson v.
State, 798 P.2d 1186, 1187 (Wyo. 1990).
[37]
Supra. at 32, citing Woolls v. McCotter, 798 F.2d 695 (5TH Cir. 1986) (holding that the use of sodium
thiopental for executions, although it may cause conscious death by suffocation, is not cruel and
unusual); LaGrand v. Lewis, 883 F. Supp. 469, 469-71 (D. Ariz. 1995) (reviewing affidavits of physicians
and prison execution protocols); Hill v. Lockhart, 791 F. Supp. 1388, 1394 (E.D. Ark. 1992) (holding that,
when the executioner has difficulty locating a vein, multiple insertions of the needle do not constitute a
cruel and unusual punishment).
[38]
Ex Parte Granviel, supra. at 509, citing Trop v. Dulles, 356 U.S. 86, 78 S. Ct. 590, 2 L.Ed. 2d 630
(1958). See also Estelle v. Gamble, 429 U.S. 97, 97 S. Ct. 285, 290, 50 L. Ed. 2d 251, 258-259 (1976).
[39]
19 Thomas Jefferson Law Review (Spring 1997) at 32-33, citing LaGrand v. Lewis, 883 F.Supp. 469,
471 (D. Ariz. 1995) (holding that lethal injection comports with societal norms based on the fact that 26
states and the federal government have adopted this method of execution); State v. Deputy, 644 A.2d 411,
421 (Del. 1994) (surveying that 28 of 37 States permitting capital punishment permit the use of lethal
injection); Delaware v. Gattis, 1995 WL 790961, at *21 (Del. Super. 1995) (holding that the AMA's ethical
ban on physician's assisting at executions does not provide evidence of society's evolving standards of
decency).
[40]
66 The George Washington Law Review (November 1997, No. 1) 84 at 100, citing Stanford v. Kentucky,
492 U.S. 361, 370-371 (1989) (plurality opinion) ("(F)irst among the "objective indicia that reflect the
public attitude toward a given sanction" are statutes passed by society's elected representatives." (quoting
McClesky, 481 U.S. at 300 (quoting Gregg, 428 U.S. at 173))); Thompson, 487 U.S. at 849 (O'Connor, J.,
concurring) ("[The] decisions of the [American legislatures] should provide the most reliable signs of a
society-wide consensus on this issue."); Gregg, 428 U.S. at 175-176) ("[T]he constitutional test [in judging
a punishment under the Cruel and Unusual Punishments Clause] is intertwined with an assessment of
contemporary standards and the legislative judgment weighs heavily in ascertaining such
standards.)"; Furman, 408 U.S. at 436-37 (Powell, J., dissenting) ("In a democracy the first indicator of the
public's attitude must always be found in the legislative judgments of the people's chosen representatives.").
[41]
Multilateral Treaties Deposited with the Secretary-General Status as at 31 December 1994, United
Nations, New York, p. 117; United Nations, Treaty Series, vol. 999, p. 171 and vol. 1057, p. 407; Human
Rights, International Instruments, Chart of Ratifications as at 31 December 1997, United Nations, p. 8.
[42]
The Safeguards Guaranteeing Protection of the Rights of Those Facing the Death Penalty was
adopted by Economic and Social Council resolution 1984-50 of May 25, 1984. The Safeguards provide:
"1. In countries which have not abolished the death penalty, capital punishment may be imposed only for
the most serious crimes, it being understood that their scope should not go beyond intentional crimes with
lethal or other extremely grave consequences.
2. Capital punishment may be imposed only for a crime for which the death penalty is prescribed by law at
the time of its commission, it being understood that if, subsequent to the commission of the crime, provision
is made by law for the imposition of a lighter penalty, the offender shall benefit thereby.
3. Persons below 18 years of age at the time of the commission of the crime shall not be sentenced to death,
nor shall the death sentence be carried out on pregnant women, or on new mothers, or on persons who have
become insane.
4. Capital punishment may be imposed only when the guilt of the person charged is based upon clear and
convincing evidence leaving no room for an alternative explanation of the facts.
5. Capital punishment may only be carried out pursuant to a final judgment rendered by a competent court
after legal process which gives all possible safeguards to ensure a fair trial, at least equal to those contained
in Article 14 of the International Covenant on Civil and Political Rights, including the right of anyone
suspected of or charged with a crime for which capital punishment may be imposed to adequate legal
assistance at all stages of the proceedings.
6. Anyone sentenced to death shall have the right to appeal to a court of higher jurisdiction, and steps should
be taken to ensure that such appeals shall become mandatory.
7. Anyone sentenced to death shall have the right to seek pardon, or commutation of sentence; pardon or
commutation of sentence may be granted in all cases of capital punishment.
8. Capital punishment shall not be carried out pending any appeal or other recourse procedure or other
proceeding relating to pardon or commutation of the sentence.
9. Where capital punishment occurs, it shall be carried out so as to inflict the minimum possible suffering."
[43]
Multilateral Treaties Deposited with the Secretary-General, Status as at 31 December 1994, United
Nations, New York, 1995, p. 153; United Nations Treaty Series, vol. 999, p. 171; Human Rights,
International Instruments, Chart of Ratifications as at 31 December 1997, United Nations, p. 8.
[44]
Multilateral Treaties Deposited with the Secretary-General, Status as at 31 December 1994, United
Nations, New York; United Nations, Doc. A/RES/44/128; Human Rights, International Instruments, Chart
of Ratifications as at 31 December 1997, United Nations, p. 8.
[45]
See Angara v. Electoral Commission, 63 Phil. 139, 156 [1936].
[46]
Defensor-Santiago v. Commission on Elections, 270 SCRA 106, 153 [1997], citing People v. Rosenthal,
68 Phil. 328 [1939]; ISAGANI A. CRUZ, Philippine Political Law 86 [1996].
[47]
Id., citing People v. Vera, 65 Phil. 56 [1937]; CRUZ, supra. 87.
[48]
See Eastern Shipping Lines, Inc. v. POEA, 166 SCRA 533, 544 [1988].
[49]
Pelaez v. Auditor-General, 15 SCRA 569, 576-577 [1965], citing Calalang v. Williams, 70 Phil.
726; Pangasinan Transp. Co. v. Public Service Commission, 70 Phil. 221; Cruz v. Youngberg, 56 Phil.
234; Alegre v. Collector of Customs, 53 Phil. 394; Mulford v. Smith, 307 U.S. 38.
[50]
Id., citing People v. Lim Ho, L-12091-2, January 28, 1960; People v. Jolliffee, L-9553, May 13, 1959;
People v. Vera, 65 Phil. 56; U.S. v. Ang Tang Ho, 43 Phil. 1; Compaia General de Tabacos v. Board of
Public Utility, 34 Phil. 136; Mutual Film Co. v. Industrial Commission, 236 U.S. 247, 59 L. Ed.,
561; Mutual Film Co. v. Industrial Commission, 236 U.S. 230, 59 L. Ed. 552; Pamana Refining Co. v.
Ryan, 293 U.S. 388, 79 L. Ed..446; A.L.A. Schecter Poulty Corp. v. U.S., 295 U.S. 495, 79 L. Ed.
1446; Bowles v. Willingham, 321 U.S. 503, 88 L. Ed. 892; Araneta v. Gatmaitan, L-8895, April 30,
1957; Cervantes v. Auditor-General, L-4043, May 26 1952; Phil. Association of Colleges v. Sec. Of
Education, 51 Off. Gaz. 6230; People v. Arnault, 48 Off. Gaz. 4805; Antamok Gold Fields v. CIR, 68 Phil.
340; U.S. v. Barrias, 11 Phil. 327; Yakus v. White, 321 U.S. 414; Ammann v. Mailonce, 332 U.S. 245.
[51]
See Edu v. Ericta, 35 SCRA 481, 496 [1970].
[52]
Id. at 497.
[53]
R.A. No. 8177, Sec. 1, first paragraph.
[54]
Id., second paragraph.
[55]
Id., third paragraph.
[56]
State v. Gee Jon, 46 Nev. 418, 211 P. 676, 682, 30 A.L.R. 1443, 1451 (1923).
[57]
Ex Parte Granviel, supra. at 513 citing citing Langford v. State, 532 S.W.2d 91, 94 (Tex. Cr.App. 1976).
[58]
Id., at 514 citing Nichols v. Dallas, 347 S.W.2d 326 (Tex.Civ.App. - Dallas, 1961).
[59]
Section 4 of Chapter I, Title III of the Administrative Code of 1987 provides:
"SEC. 4. Organizational structure. - The Department (of Justice) shall consist of the following constituent
units:
(1) Department proper;
(2) Office of the Government Corporate Counsel;
(3) National Bureau of Investigation;
(4) Public Attorney's Office;
(5) Board of Pardons and Parole;
(6) Parole and Probation Administration;
(7) Bureau of Corrections;
(8) Land Registration Authority;
(9) Commission on the Settlement of Land Problems."
[60]
Section 1 of Chapter I, Title III of the Administrative Code of 1987 provides:
"SEC. 1. Declaration of Policy. - It is the declared policy of the State to provide the government with a
principal law agency which shall be both its legal counsel and prosecution arm; administer the criminal
justice system in accordance with the accepted processes thereof consisting in the investigation of the
crimes, prosecution of offenders and administration of the correctional system; implement the laws on the
admission and stay of aliens, citizenship, land titling system, and settlement of land problems involving
small landowners and members of indigenous cultural minorities; and provide free legal services to indigent
members of the society."
[61]
Section 3 of R.A. No. 8177 provides:
"SEC. 3. Implementing Rules. - The Secretary of Justice in coordination with the Secretary of Health and
the Bureau of Corrections shall, within thirty (30) days from the effectivity of this Act, promulgate the rules
to implement its provisions."
[62]
Legaspi v. Civil Service Commission, 150 SCRA 530, 541 [1987]
[63]
Id. at 540, citing Baldoza v. Dimaano, Adm, Matter No. 1120-MJ, May 5, 1976, 17 SCRA 14.
[64]
Id., citing Thornill v. Alabama, 310 U.S. 88, 102 [1939].
[65]
Id., citing 87 Harvard Law Review 1505 [1974].
[66]
Id.
[67]
Grego v. Commission on Elections, 274 SCRA 481, 498 [1997], citing Commissioner of Internal
Revenue v. Court of Appeals, 240 SCRA 368 [1995].
[68]
Id. At 498-499, citing Miners Association of the Philippines, Inc. v. Factoran, Jr., 240 SCRA 100
[1995], further citing Santos v. Estenzo, 109 Phil. 419, 422 (1960); Teoxon v. Members of the Board of
Administrators, 33 SCRA 585 [1970]; Manuel v. General Auditing Office, 42 SCRA 660 [1971], Deluao
v. Casteel, 29 SCRA 350 [1969].
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 74457 March 20, 1987
RESTITUTO YNOT, petitioner,
vs.
INTERMEDIATE APPELLATE COURT, THE STATION COMMANDER, INTEGRATED
NATIONAL POLICE, BAROTAC NUEVO, ILOILO and THE REGIONAL DIRECTOR,
BUREAU OF ANIMAL INDUSTRY, REGION IV, ILOILO CITY, respondents.
Ramon A. Gonzales for petitioner.
CRUZ, J.:
The essence of due process is distilled in the immortal cry of Themistocles to Alcibiades "Strike but
hear me first!" It is this cry that the petitioner in effect repeats here as he challenges the constitutionality
of Executive Order No. 626-A.
The said executive order reads in full as follows:
WHEREAS, the President has given orders prohibiting the interprovincial movement of carabaos and the
slaughtering of carabaos not complying with the requirements of Executive Order No. 626 particularly
with respect to age;
WHEREAS, it has been observed that despite such orders the violators still manage to circumvent the
prohibition against inter-provincial movement of carabaos by transporting carabeef instead; and
WHEREAS, in order to achieve the purposes and objectives of Executive Order No. 626 and the
prohibition against interprovincial movement of carabaos, it is necessary to strengthen the said Executive
Order and provide for the disposition of the carabaos and carabeef subject of the violation;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the
powers vested in me by the Constitution, do hereby promulgate the following:
SECTION 1. Executive Order No. 626 is hereby amended such that henceforth, no carabao regardless of
age, sex, physical condition or purpose and no carabeef shall be transported from one province to another.
The carabao or carabeef transported in violation of this Executive Order as amended shall be subject to
confiscation and forfeiture by the government, to be distributed to charitable institutions and other similar
institutions as the Chairman of the National Meat Inspection Commission may ay see fit, in the case of
carabeef, and to deserving farmers through dispersal as the Director of Animal Industry may see fit, in the
case of carabaos.
SECTION 2. This Executive Order shall take effect immediately.
Done in the City of Manila, this 25th day of October, in the year of Our Lord, nineteen hundred and
eighty.
(SGD.) FERDINAND E. MARCOS
President
The petitioner had transported six carabaos in a pump boat from Masbate to Iloilo on January 13, 1984,
when they were confiscated by the police station commander of Barotac Nuevo, Iloilo, for violation of the
above measure. 1 The petitioner sued for recovery, and the Regional Trial Court of Iloilo City issued a
writ of replevin upon his filing of a supersedeas bond of P12,000.00. After considering the merits of the
case, the court sustained the confiscation of the carabaos and, since they could no longer be produced,
ordered the confiscation of the bond. The court also declined to rule on the constitutionality of the
executive order, as raise by the petitioner, for lack of authority and also for its presumed validity. 2
The petitioner appealed the decision to the Intermediate Appellate Court,* 3 which upheld the trial
court, ** and he has now come before us in this petition for review on certiorari.
The thrust of his petition is that the executive order is unconstitutional insofar as it authorizes outright
confiscation of the carabao or carabeef being transported across provincial boundaries. His claim is that
the penalty is invalid because it is imposed without according the owner a right to be heard before a
competent and impartial court as guaranteed by due process. He complains that the measure should not
have been presumed, and so sustained, as constitutional. There is also a challenge to the improper
exercise of the legislative power by the former President under Amendment No. 6 of the 1973
Constitution. 4
While also involving the same executive order, the case of Pesigan v. Angeles 5 is not applicable here.
The question raised there was the necessity of the previous publication of the measure in the Official
Gazette before it could be considered enforceable. We imposed the requirement then on the basis of due
process of law. In doing so, however, this Court did not, as contended by the Solicitor General, impliedly
affirm the constitutionality of Executive Order No. 626-A. That is an entirely different matter.
This Court has declared that while lower courts should observe a becoming modesty in examining
constitutional questions, they are nonetheless not prevented from resolving the same whenever warranted,
subject only to review by the highest tribunal. 6 We have jurisdiction under the Constitution to "review,
revise, reverse, modify or affirm on appeal or certiorari, as the law or rules of court may provide," final
judgments and orders of lower courts in, among others, all cases involving the constitutionality of certain
measures. 7 This simply means that the resolution of such cases may be made in the first instance by these
lower courts.
And while it is true that laws are presumed to be constitutional, that presumption is not by any means
conclusive and in fact may be rebutted. Indeed, if there be a clear showing of their invalidity, and of the
need to declare them so, then "will be the time to make the hammer fall, and heavily," 8 to recall Justice
Laurel's trenchant warning. Stated otherwise, courts should not follow the path of least resistance by
simply presuming the constitutionality of a law when it is questioned. On the contrary, they should probe
the issue more deeply, to relieve the abscess, paraphrasing another distinguished jurist, 9 and so heal the
wound or excise the affliction.
Judicial power authorizes this; and when the exercise is demanded, there should be no shirking of the task
for fear of retaliation, or loss of favor, or popular censure, or any other similar inhibition unworthy of the
bench, especially this Court.
The challenged measure is denominated an executive order but it is really presidential decree,
promulgating a new rule instead of merely implementing an existing law. It was issued by President
Marcos not for the purpose of taking care that the laws were faithfully executed but in the exercise of his
legislative authority under Amendment No. 6. It was provided thereunder that whenever in his judgment
there existed a grave emergency or a threat or imminence thereof or whenever the legislature failed or
was unable to act adequately on any matter that in his judgment required immediate action, he could, in
order to meet the exigency, issue decrees, orders or letters of instruction that were to have the force and
effect of law. As there is no showing of any exigency to justify the exercise of that extraordinary power
then, the petitioner has reason, indeed, to question the validity of the executive order. Nevertheless, since
the determination of the grounds was supposed to have been made by the President "in his judgment, " a
phrase that will lead to protracted discussion not really necessary at this time, we reserve resolution of this
matter until a more appropriate occasion. For the nonce, we confine ourselves to the more fundamental
question of due process.
It is part of the art of constitution-making that the provisions of the charter be cast in precise and
unmistakable language to avoid controversies that might arise on their correct interpretation. That is the
Ideal. In the case of the due process clause, however, this rule was deliberately not followed and the
wording was purposely kept ambiguous. In fact, a proposal to delineate it more clearly was submitted in
the Constitutional Convention of 1934, but it was rejected by Delegate Jose P. Laurel, Chairman of the
Committee on the Bill of Rights, who forcefully argued against it. He was sustained by the body. 10
The due process clause was kept intentionally vague so it would remain also conveniently resilient. This
was felt necessary because due process is not, like some provisions of the fundamental law, an "iron rule"
laying down an implacable and immutable command for all seasons and all persons. Flexibility must be
the best virtue of the guaranty. The very elasticity of the due process clause was meant to make it adapt
easily to every situation, enlarging or constricting its protection as the changing times and circumstances
may require.
Aware of this, the courts have also hesitated to adopt their own specific description of due process lest
they confine themselves in a legal straitjacket that will deprive them of the elbow room they may need to
vary the meaning of the clause whenever indicated. Instead, they have preferred to leave the import of the
protection open-ended, as it were, to be "gradually ascertained by the process of inclusion and exclusion
in the course of the decision of cases as they arise." 11 Thus, Justice Felix Frankfurter of the U.S.
Supreme Court, for example, would go no farther than to define due process and in so doing sums it all
up as nothing more and nothing less than "the embodiment of the sporting Idea of fair play." 12
When the barons of England extracted from their sovereign liege the reluctant promise that that Crown
would thenceforth not proceed against the life liberty or property of any of its subjects except by the
lawful judgment of his peers or the law of the land, they thereby won for themselves and their progeny
that splendid guaranty of fairness that is now the hallmark of the free society. The solemn vow that King
John made at Runnymede in 1215 has since then resounded through the ages, as a ringing reminder to all
rulers, benevolent or base, that every person, when confronted by the stern visage of the law, is entitled to
have his say in a fair and open hearing of his cause.
The closed mind has no place in the open society. It is part of the sporting Idea of fair play to hear "the
other side" before an opinion is formed or a decision is made by those who sit in judgment. Obviously,
one side is only one-half of the question; the other half must also be considered if an impartial verdict is
to be reached based on an informed appreciation of the issues in contention. It is indispensable that the
two sides complement each other, as unto the bow the arrow, in leading to the correct ruling after
examination of the problem not from one or the other perspective only but in its totality. A judgment
based on less that this full appraisal, on the pretext that a hearing is unnecessary or useless, is tainted with
the vice of bias or intolerance or ignorance, or worst of all, in repressive regimes, the insolence of power.
The minimum requirements of due process are notice and hearing 13 which, generally speaking, may not
be dispensed with because they are intended as a safeguard against official arbitrariness. It is a gratifying
commentary on our judicial system that the jurisprudence of this country is rich with applications of this
guaranty as proof of our fealty to the rule of law and the ancient rudiments of fair play. We have
consistently declared that every person, faced by the awesome power of the State, is entitled to "the law
of the land," which Daniel Webster described almost two hundred years ago in the famous Dartmouth
College Case, 14 as "the law which hears before it condemns, which proceeds upon inquiry and renders
judgment only after trial." It has to be so if the rights of every person are to be secured beyond the reach
of officials who, out of mistaken zeal or plain arrogance, would degrade the due process clause into a
worn and empty catchword.
This is not to say that notice and hearing are imperative in every case for, to be sure, there are a number of
admitted exceptions. The conclusive presumption, for example, bars the admission of contrary evidence
as long as such presumption is based on human experience or there is a rational connection between the
fact proved and the fact ultimately presumed therefrom. 15 There are instances when the need for
expeditions action will justify omission of these requisites, as in the summary abatement of a nuisance per
se, like a mad dog on the loose, which may be killed on sight because of the immediate danger it poses to
the safety and lives of the people. Pornographic materials, contaminated meat and narcotic drugs are
inherently pernicious and may be summarily destroyed. The passport of a person sought for a criminal
offense may be cancelled without hearing, to compel his return to the country he has fled. 16 Filthy
restaurants may be summarily padlocked in the interest of the public health and bawdy houses to protect
the public morals. 17 In such instances, previous judicial hearing may be omitted without violation of due
process in view of the nature of the property involved or the urgency of the need to protect the general
welfare from a clear and present danger.
The protection of the general welfare is the particular function of the police power which both restraints
and is restrained by due process. The police power is simply defined as the power inherent in the State to
regulate liberty and property for the promotion of the general welfare. 18 By reason of its function, it
extends to all the great public needs and is described as the most pervasive, the least limitable and the
most demanding of the three inherent powers of the State, far outpacing taxation and eminent domain.
The individual, as a member of society, is hemmed in by the police power, which affects him even before
he is born and follows him still after he is dead from the womb to beyond the tomb in practically
everything he does or owns. Its reach is virtually limitless. It is a ubiquitous and often unwelcome
intrusion. Even so, as long as the activity or the property has some relevance to the public welfare, its
regulation under the police power is not only proper but necessary. And the justification is found in the
venerable Latin maxims, Salus populi est suprema lex and Sic utere tuo ut alienum non laedas, which call
for the subordination of individual interests to the benefit of the greater number.
It is this power that is now invoked by the government to justify Executive Order No. 626-A, amending
the basic rule in Executive Order No. 626, prohibiting the slaughter of carabaos except under certain
conditions. The original measure was issued for the reason, as expressed in one of its Whereases, that
"present conditions demand that the carabaos and the buffaloes be conserved for the benefit of the small
farmers who rely on them for energy needs." We affirm at the outset the need for such a measure. In the
face of the worsening energy crisis and the increased dependence of our farms on these traditional beasts
of burden, the government would have been remiss, indeed, if it had not taken steps to protect and
preserve them.
A similar prohibition was challenged in United States v. Toribio, 19 where a law regulating the
registration, branding and slaughter of large cattle was claimed to be a deprivation of property without
due process of law. The defendant had been convicted thereunder for having slaughtered his own carabao
without the required permit, and he appealed to the Supreme Court. The conviction was affirmed. The law
was sustained as a valid police measure to prevent the indiscriminate killing of carabaos, which were then
badly needed by farmers. An epidemic had stricken many of these animals and the reduction of their
number had resulted in an acute decline in agricultural output, which in turn had caused an incipient
famine. Furthermore, because of the scarcity of the animals and the consequent increase in their price,
cattle-rustling had spread alarmingly, necessitating more effective measures for the registration and
branding of these animals. The Court held that the questioned statute was a valid exercise of the police
power and declared in part as follows:
To justify the State in thus interposing its authority in behalf of the public, it must appear, first, that the
interests of the public generally, as distinguished from those of a particular class, require such
interference; and second, that the means are reasonably necessary for the accomplishment of the purpose,
and not unduly oppressive upon individuals. ...
From what has been said, we think it is clear that the enactment of the provisions of the statute under
consideration was required by "the interests of the public generally, as distinguished from those of a
particular class" and that the prohibition of the slaughter of carabaos for human consumption, so long as
these animals are fit for agricultural work or draft purposes was a "reasonably necessary" limitation on
private ownership, to protect the community from the loss of the services of such animals by their
slaughter by improvident owners, tempted either by greed of momentary gain, or by a desire to enjoy the
luxury of animal food, even when by so doing the productive power of the community may be
measurably and dangerously affected.
In the light of the tests mentioned above, we hold with the Toribio Case that the carabao, as the poor
man's tractor, so to speak, has a direct relevance to the public welfare and so is a lawful subject of
Executive Order No. 626. The method chosen in the basic measure is also reasonably necessary for the
purpose sought to be achieved and not unduly oppressive upon individuals, again following the above-
cited doctrine. There is no doubt that by banning the slaughter of these animals except where they are at
least seven years old if male and eleven years old if female upon issuance of the necessary permit, the
executive order will be conserving those still fit for farm work or breeding and preventing their
improvident depletion.
But while conceding that the amendatory measure has the same lawful subject as the original executive
order, we cannot say with equal certainty that it complies with the second requirement, viz., that there be a
lawful method. We note that to strengthen the original measure, Executive Order No. 626-A imposes an
absolute ban not on the slaughter of the carabaos but on their movement, providing that "no carabao
regardless of age, sex, physical condition or purpose (sic) and no carabeef shall be transported from one
province to another." The object of the prohibition escapes us. The reasonable connection between the
means employed and the purpose sought to be achieved by the questioned measure is missing
We do not see how the prohibition of the inter-provincial transport of carabaos can prevent their
indiscriminate slaughter, considering that they can be killed anywhere, with no less difficulty in one
province than in another. Obviously, retaining the carabaos in one province will not prevent their
slaughter there, any more than moving them to another province will make it easier to kill them there. As
for the carabeef, the prohibition is made to apply to it as otherwise, so says executive order, it could be
easily circumvented by simply killing the animal. Perhaps so. However, if the movement of the live
animals for the purpose of preventing their slaughter cannot be prohibited, it should follow that there is no
reason either to prohibit their transfer as, not to be flippant dead meat.
Even if a reasonable relation between the means and the end were to be assumed, we would still have to
reckon with the sanction that the measure applies for violation of the prohibition. The penalty is outright
confiscation of the carabao or carabeef being transported, to be meted out by the executive authorities,
usually the police only. In the Toribio Case, the statute was sustained because the penalty prescribed was
fine and imprisonment, to be imposed by the court after trial and conviction of the accused. Under the
challenged measure, significantly, no such trial is prescribed, and the property being transported is
immediately impounded by the police and declared, by the measure itself, as forfeited to the government.
In the instant case, the carabaos were arbitrarily confiscated by the police station commander, were
returned to the petitioner only after he had filed a complaint for recovery and given a supersedeas bond of
P12,000.00, which was ordered confiscated upon his failure to produce the carabaos when ordered by the
trial court. The executive order defined the prohibition, convicted the petitioner and immediately imposed
punishment, which was carried out forthright. The measure struck at once and pounced upon the
petitioner without giving him a chance to be heard, thus denying him the centuries-old guaranty of
elementary fair play.
It has already been remarked that there are occasions when notice and hearing may be validly dispensed
with notwithstanding the usual requirement for these minimum guarantees of due process. It is also
conceded that summary action may be validly taken in administrative proceedings as procedural due
process is not necessarily judicial only. 20 In the exceptional cases accepted, however. there is a
justification for the omission of the right to a previous hearing, to wit, the immediacy of the problem
sought to be corrected and the urgency of the need to correct it.
In the case before us, there was no such pressure of time or action calling for the petitioner's peremptory
treatment. The properties involved were not even inimical per se as to require their instant destruction.
There certainly was no reason why the offense prohibited by the executive order should not have been
proved first in a court of justice, with the accused being accorded all the rights safeguarded to him under
the Constitution. Considering that, as we held in Pesigan v. Angeles, 21 Executive Order No. 626-A is
penal in nature, the violation thereof should have been pronounced not by the police only but by a court of
justice, which alone would have had the authority to impose the prescribed penalty, and only after trial
and conviction of the accused.
We also mark, on top of all this, the questionable manner of the disposition of the confiscated property as
prescribed in the questioned executive order. It is there authorized that the seized property shall "be
distributed to charitable institutions and other similar institutions as the Chairman of the National Meat
Inspection Commission may see fit, in the case of carabeef, and to deserving farmers through dispersal as
the Director of Animal Industry may see fit, in the case of carabaos." (Emphasis supplied.) The
phrase "may see fit" is an extremely generous and dangerous condition, if condition it is. It is laden with
perilous opportunities for partiality and abuse, and even corruption. One searches in vain for the usual
standard and the reasonable guidelines, or better still, the limitations that the said officers must observe
when they make their distribution. There is none. Their options are apparently boundless. Who shall be
the fortunate beneficiaries of their generosity and by what criteria shall they be chosen? Only the officers
named can supply the answer, they and they alone may choose the grantee as they see fit, and in their own
exclusive discretion. Definitely, there is here a "roving commission," a wide and sweeping authority that
is not "canalized within banks that keep it from overflowing," in short, a clearly profligate and therefore
invalid delegation of legislative powers.
To sum up then, we find that the challenged measure is an invalid exercise of the police power because
the method employed to conserve the carabaos is not reasonably necessary to the purpose of the law and,
worse, is unduly oppressive. Due process is violated because the owner of the property confiscated is
denied the right to be heard in his defense and is immediately condemned and punished. The conferment
on the administrative authorities of the power to adjudge the guilt of the supposed offender is a clear
encroachment on judicial functions and militates against the doctrine of separation of powers. There is,
finally, also an invalid delegation of legislative powers to the officers mentioned therein who are granted
unlimited discretion in the distribution of the properties arbitrarily taken. For these reasons, we hereby
declare Executive Order No. 626-A unconstitutional.
We agree with the respondent court, however, that the police station commander who confiscated the
petitioner's carabaos is not liable in damages for enforcing the executive order in accordance with its
mandate. The law was at that time presumptively valid, and it was his obligation, as a member of the
police, to enforce it. It would have been impertinent of him, being a mere subordinate of the President, to
declare the executive order unconstitutional and, on his own responsibility alone, refuse to execute it.
Even the trial court, in fact, and the Court of Appeals itself did not feel they had the competence, for all
their superior authority, to question the order we now annul.
The Court notes that if the petitioner had not seen fit to assert and protect his rights as he saw them, this
case would never have reached us and the taking of his property under the challenged measure would
have become a faitaccompli despite its invalidity. We commend him for his spirit. Without the present
challenge, the matter would have ended in that pump boat in Masbate and another violation of the
Constitution, for all its obviousness, would have been perpetrated, allowed without protest, and soon
forgotten in the limbo of relinquished rights.
The strength of democracy lies not in the rights it guarantees but in the courage of the people to invoke
them whenever they are ignored or violated. Rights are but weapons on the wall if, like expensive
tapestry, all they do is embellish and impress. Rights, as weapons, must be a promise of protection. They
become truly meaningful, and fulfill the role assigned to them in the free society, if they are kept bright
and sharp with use by those who are not afraid to assert them.
WHEREFORE, Executive Order No. 626-A is hereby declared unconstitutional. Except as affirmed
above, the decision of the Court of Appeals is reversed. The supersedeas bond is cancelled and the
amount thereof is ordered restored to the petitioner. No costs.
SO ORDERED.
Teehankee, C.J., Yap, Fernan, Narvasa, Gutierrez, Jr., Paras, Gancayco, Padilla Bidin Sarmiento and
Cortes, JJ., concur.
Melencio-Herrera and Feliciano, JJ., are on leave.
Footnotes
1 Rollo, pp. 7, 28, 29, 34.
2 Ibid, pp. 6-7; Annex B.
* Justices Coquia, Bartolome and Ejercito.
3 Rollo, pp. 6, 27, 33.
** Judge Bethel Katalbas-Moscardon.
4 Ibid., pp. 10; 11, 14-16, 76.
5 129 SCRA 174.
6 Espiritu vs. Fugoso, 81 Phil. 637.
7 Sec. 5[2(a)], Art. X, 1973 Constitution; Sec. 5[2(a)], Art.VIII, 1987 Constitution.
8 J. Laurel, concurring opinion, Zandueta v. dela Costa, 66 Phil. 615, 627.
9 US v. Bustos, 37 Phil. 731.
10 I Aruego, The Framing of the Constitution (1936), pp. 153-159.
11 Twinning vs. New Jersey, 211 U.S. 78.
12 Frankfurter, Mr. Justice Holmes and the Supreme Court, pp. 32-33.
13 David vs. Aquilizan, 94 SCRA 707; Montemayor vs. Araneta Univ. Foundation, 77 SCRA 321;
Lentelera vs. Amores, 70 SCRA 37; Flores vs. Buencamino, 74 SCRA 332; DBP vs. Bautista, 26 SCRA
366; Ong Su Han vs. Gutierrez David, 76 Phil. 546; Banco-Espanol Filipino vs. Palanca, 37 Phil. 921.
14 Dartmouth College vs. Woodward, 4 Wheaton 518.
15 Manley v. Georgia, 279 U.S. 1; 1 Cooley 639.
16 Suntay vs. People, 101 Phil. 833.
17 12 C.J. 1224.
18 People v. Vera Reyes, 67 Phil. 190; Ermita-Malate Hotel & Motel Operators Ass. v. City Mayor, 20
SCRA 849; Primicias v. Fugoso 80 Phil. 75; U.S. v. Ling Su Tan, 10 Phil. 114; Collins v. Wolfe 5 Phil.
297; U.S. v. Gomez Jesus, 31 Phil. 225; Churchill v. Rafferty 32 Phil. 603.
19 15 Phil. 85.
20 New Filipino Maritime Agencies, Inc. vs. Rivera, 83 SCRA 602; Gas Corp. of the Phil. vs. Inciong 93
SCRA 653.
21 supra.
SUPREME COURT
Manila
EN BANC
G.R. No. 203335 February 11, 2014
JOSE JESUS M. DISINI, JR., ROWENA S. DISINI, LIANNE IVY P. MEDINA, JANETTE
TORAL and ERNESTO SONIDO, JR., Petitioners,
vs.
THE SECRETARY OF JUSTICE, THE SECRETARY OF THE DEPARTMENT OF THE
INTERIOR AND LOCAL GOVERNMENT, THE EXECUTIVE DIRECTOR OF THE
INFORMATION AND COMMUNICATIONS TECHNOLOGY OFFICE, THE CHIEF OF THE
PHILIPPINE NATIONAL POLICE and THE DIRECTOR OF THE NATIONAL BUREAU OF
INVESTIGATION, Respondents.
x-----------------------x
G.R. No. 203299
LOUIS "BAROK" C. BIRAOGO, Petitioner,
vs.
NATIONAL BUREAU OF INVESTIGATION and PHILIPPINE NATIONAL
POLICE, Respondents.
x-----------------------x
G.R. No. 203306
ALAB NG MAMAMAHAYAG (ALAM), HUKUMAN NG MAMAMAYAN MOVEMENT, INC.,
JERRY S. YAP, BERTENI "TOTO" CAUSING, HERNANI Q. CUARE, PERCY LAPID, TRACY
CABRERA, RONALDO E. RENTA, CIRILO P. SABARRE, JR., DERVIN CASTRO, ET
AL., Petitioners,
vs.
OFFICE OF THE PRESIDENT, represented by President Benigno Simeon Aquino III, SENATE
OF THE PHILIPPINES, and HOUSE OF REPRESENTATIVES, Respondents.
x-----------------------x
G.R. No. 203359
SENATOR TEOFISTO DL GUINGONA III, Petitioner,
vs.
EXECUTIVE SECRETARY, THE SECRETARY OF JUSTICE, THE SECRETARY OF THE
DEPARTMENT OF INTERIOR AND LOCAL GOVERNMENT, THE CHIEF OF THE
PHILIPPINE NATIONAL POLICE, and DIRECTOR OF THE NATIONAL BUREAU OF
INVESTIGATION, Respondents.
x-----------------------x
G.R. No. 203378
ALEXANDER ADONIS, ELLEN TORDESILLAS, MA. GISELA ORDENES-CASCOLAN, H.
HARRY L. ROQUE, JR., ROMEL R. BAGARES, and GILBERT T. ANDRES, Petitioners,
vs.
THE EXECUTIVE SECRETARY, THE DEPARTMENT OF BUDGET AND MANAGEMENT,
THE DEPARTMENT OF JUSTICE, THE DEPARTMENT OF THE INTERIOR AND LOCAL
GOVERNMENT, THE NATIONAL BUREAU OF INVESTIGATION, THE PHILIPPINE
NATIONAL POLICE, AND THE INFORMATION AND COMMUNICATIONS TECHNOLOGY
OFFICE-DEPARTMENT OF SCIENCE AND TECHNOLOGY, Respondents.
x-----------------------x
G.R. No. 203391
HON. RAYMOND V. PALATINO, HON. ANTONIO TINIO, VENCER MARI CRISOSTOMO
OF ANAKBAYAN, MA. KATHERINE ELONA OF THE PHILIPPINE COLLEGIAN,
ISABELLE THERESE BAGUISI OF THE NATIONAL UNION OF STUDENTS OF THE
PHILIPPINES, ET AL., Petitioners,
vs.
PAQUITO N. OCHOA, JR., in his capacity as Executive Secretary and alter-ego of President
Benigno Simeon Aquino III, LEILA DE LIMA in her capacity as Secretary of Justice, Respondents.
x-----------------------x
G.R. No. 203407
BAGONG ALYANSANG MAKABAYAN SECRETARY GENERAL RENATO M. REYES, JR.,
National Artist BIENVENIDO L. LUMBERA, Chairperson of Concerned Artists of the
Philippines, ELMER C. LABOG, Chairperson of Kilusang Mayo Uno, CRISTINA E. PALABAY,
Secretary General of Karapatan, FERDINAND R. GAITE, Chairperson of COURAGE, JOEL B.
MAGLUNSOD, Vice President of Anakpawis Party-List, LANA R. LINABAN, Secretary General
Gabriela Women's Party, ADOLFO ARES P. GUTIERREZ, and JULIUS GARCIA
MATIBAG, Petitioners,
vs.
BENIGNO SIMEON C. AQUINO III, President of the Republic of the Philippines, PAQUITO N.
OCHOA, JR., Executive Secretary, SENATE OF THE PHILIPPINES, represented by SENATE
PRESIDENT JUAN PONCE ENRILE, HOUSE OF REPRESENTATIVES, represented by
SPEAKER FELICIANO BELMONTE, JR., LEILA DE LIMA, Secretary of the Department of
Justice, LOUIS NAPOLEON C. CASAMBRE, Executive Director of the Information and
Communications Technology Office, NONNATUS CAESAR R. ROJAS, Director of the National
Bureau of Investigation, D/GEN. NICANOR A. BARTOLOME, Chief of the Philippine National
Police, MANUEL A. ROXAS II, Secretary of the Department of the Interior and Local
Government, Respondents.
x-----------------------x
G.R. No. 203440
MELENCIO S. STA. MARIA, SEDFREY M. CANDELARIA, AMPARITA STA. MARIA, RAY
PAOLO J. SANTIAGO, GILBERT V. SEMBRANO, and RYAN JEREMIAH D. QUAN (all of the
Ateneo Human Rights Center),Petitioners,
vs.
HONORABLE PAQUITO OCHOA in his capacity as Executive Secretary, HONORABLE LEILA
DE LIMA in her capacity as Secretary of Justice, HONORABLE MANUEL ROXAS in his capacity
as Secretary of the Department of Interior and Local Government, The CHIEF of the Philippine
National Police, The DIRECTOR of the National Bureau of Investigation (all of the Executive
Department of Government), Respondents.
x-----------------------x
G.R. No. 203453
NATIONAL UNION OF JOURNALISTS OF THE PHILIPPINES (NUJP), PHILIPPINE PRESS
INSTITUTE (PPI), CENTER FOR MEDIA FREEDOM AND RESPONSIBILITY, ROWENA
CARRANZA PARAAN, MELINDA QUINTOS-DE JESUS, JOSEPH ALWYN ALBURO, ARIEL
SEBELLINO AND THE PETITIONERS IN THE e-PETITION http://www.nujp.org/no-to-
ra10175/, Petitioners,
vs.
THE EXECUTIVE SECRETARY, THE SECRETARY OF JUSTICE, THE SECRETARY OF
THE INTERIOR AND LOCAL GOVERNMENT, THE SECRETARY OF BUDGET AND
MANAGEMENT, THE DIRECTOR GENERAL OF THE PHILIPPINE NATIONAL POLICE,
THE DIRECTOR OF THE NATIONAL BUREAU OF INVESTIGATION, THE CYBERCRIME
INVESTIGATION AND COORDINATING CENTER, AND ALL AGENCIES AND
INSTRUMENTALITIES OF GOVERNMENT AND ALL PERSONS ACTING UNDER THEIR
INSTRUCTIONS, ORDERS, DIRECTION IN RELATION TO THE IMPLEMENTATION OF
REPUBLIC ACT NO. 10175, Respondents.
x-----------------------x
G.R. No. 203454
PAUL CORNELIUS T. CASTILLO & RYAN D. ANDRES, Petitioners,
vs.
THE HON. SECRETARY OF JUSTICE THE HON. SECRETARY OF INTERIOR AND LOCAL
GOVERNMENT,Respondents.
x-----------------------x
G.R. No. 203469
ANTHONY IAN M. CRUZ; MARCELO R. LANDICHO; BENJAMIN NOEL A. ESPINA;
MARCK RONALD C. RIMORIN; JULIUS D. ROCAS; OLIVER RICHARD V. ROBILLO;
AARON ERICK A. LOZADA; GERARD ADRIAN P. MAGNAYE; JOSE REGINALD A.
RAMOS; MA. ROSARIO T. JUAN; BRENDALYN P. RAMIREZ; MAUREEN A.
HERMITANIO; KRISTINE JOY S. REMENTILLA; MARICEL O. GRAY; JULIUS IVAN F.
CABIGON; BENRALPH S. YU; CEBU BLOGGERS SOCIETY, INC. PRESIDENT RUBEN B.
LICERA, JR; and PINOY EXPAT/OFW BLOG AWARDS, INC. COORDINATOR PEDRO E.
RAHON; Petitioners,
vs.
HIS EXCELLENCY BENIGNO S. AQUINO III, in his capacity as President of the Republic of the
Philippines; SENATE OF THE PHILIPPINES, represented by HON. JUAN PONCE ENRILE, in
his capacity as Senate President; HOUSE OF REPRESENTATIVES, represented by FELICIANO
R. BELMONTE, JR., in his capacity as Speaker of the House of Representatives; HON. PAQUITO
N. OCHOA, JR., in his capacity as Executive Secretary; HON. LEILA M. DE LIMA, in her
capacity as Secretary of Justice; HON. LOUIS NAPOLEON C. CASAMBRE, in his capacity as
Executive Director, Information and Communications Technology Office; HON. NONNATUS
CAESAR R. ROJAS, in his capacity as Director, National Bureau of Investigation; and P/DGEN.
NICANOR A. BARTOLOME, in his capacity as Chief, Philippine National Police, Respondents.
x-----------------------x
G.R. No. 203501
PHILIPPINE BAR ASSOCIATION, INC., Petitioner,
vs.
HIS EXCELLENCY BENIGNO S. AQUINO III, in his official capacity as President of the
Republic of the Philippines; HON. PAQUITO N. OCHOA, JR., in his official capacity as Executive
Secretary; HON. LEILA M. DE LIMA, in her official capacity as Secretary of Justice; LOUIS
NAPOLEON C. CASAMBRE, in his official capacity as Executive Director, Information and
Communications Technology Office; NONNATUS CAESAR R. ROJAS, in his official capacity as
Director of the National Bureau of Investigation; and DIRECTOR GENERAL NICANOR A.
BARTOLOME, in his official capacity as Chief of the Philippine National Police,Respondents.
x-----------------------x
G.R. No. 203509
BAYAN MUNA REPRESENTATIVE NERI J. COLMENARES, Petitioner,
vs.
THE EXECUTIVE SECRETARY PAQUITO OCHOA, JR., Respondent.
x-----------------------x
G.R. No. 203515
NATIONAL PRESS CLUB OF THE PHILIPPINES, INC. represented by BENNY D.
ANTIPORDA in his capacity as President and in his personal capacity, Petitioner,
vs.
OFFICE OF THE PRESIDENT, PRES. BENIGNO SIMEON AQUINO III, DEPARTMENT OF
JUSTICE, DEPARTMENT OF INTERIOR AND LOCAL GOVERNMENT, PHILIPPINE
NATIONAL POLICE, NATIONAL BUREAU OF INVESTIGATION, DEPARTMENT OF
BUDGET AND MANAGEMENT AND ALL OTHER GOVERNMENT INSTRUMENTALITIES
WHO HAVE HANDS IN THE PASSAGE AND/OR IMPLEMENTATION OF REPUBLIC ACT
10175, Respondents.
x-----------------------x
G.R. No. 203518
PHILIPPINE INTERNET FREEDOM ALLIANCE, composed of DAKILA-PHILIPPINE
COLLECTIVE FOR MODERN HEROISM, represented by Leni Velasco, PARTIDO LAKAS NG
MASA, represented by Cesar S. Melencio, FRANCIS EUSTON R. ACERO, MARLON
ANTHONY ROMASANTA TONSON, TEODORO A. CASIO, NOEMI LARDIZABAL-DADO,
IMELDA ORALES, JAMES MATTHEW B. MIRAFLOR, JUAN G.M. RAGRAGIO, MARIA
FATIMA A. VILLENA, MEDARDO M. MANRIQUE, JR., LAUREN DADO, MARCO
VITTORIA TOBIAS SUMAYAO, IRENE CHIA, ERASTUS NOEL T. DELIZO, CRISTINA
SARAH E. OSORIO, ROMEO FACTOLERIN, NAOMI L. TUPAS, KENNETH KENG, ANA
ALEXANDRA C. CASTRO, Petitioners,
vs.
THE EXECUTIVE SECRETARY, THE SECRETARY OF JUSTICE, THE SECRETARY OF
INTERIOR AND LOCAL GOVERNMENT, THE SECRETARY OF SCIENCE AND
TECHNOLOGY, THE EXECUTIVE DIRECTOR OF THE INFORMATION TECHNOLOGY
OFFICE, THE DIRECTOR OF THE NATIONAL BUREAU OF INVESTIGATION, THE CHIEF,
PHILIPPINE NATIONAL POLICE, THE HEAD OF THE DOJ OFFICE OF CYBERCRIME, and
THE OTHER MEMBERS OF THE CYBERCRIME INVESTIGATION AND COORDINATING
CENTER, Respondents.
DECISION
ABAD, J.:
These consolidated petitions seek to declare several provisions of Republic Act (R.A.) 10175, the
Cybercrime Prevention Act of 2012, unconstitutional and void.
The Facts and the Case
The cybercrime law aims to regulate access to and use of the cyberspace. Using his laptop or computer, a
person can connect to the internet, a system that links him to other computers and enable him, among
other things, to:
1. Access virtual libraries and encyclopedias for all kinds of information that he needs for research, study,
amusement, upliftment, or pure curiosity;
2. Post billboard-like notices or messages, including pictures and videos, for the general public or for
special audiences like associates, classmates, or friends and read postings from them;
3. Advertise and promote goods or services and make purchases and payments;
4. Inquire and do business with institutional entities like government agencies, banks, stock exchanges,
trade houses, credit card companies, public utilities, hospitals, and schools; and
5. Communicate in writing or by voice with any person through his e-mail address or telephone.
This is cyberspace, a system that accommodates millions and billions of simultaneous and ongoing
individual accesses to and uses of the internet. The cyberspace is a boon to the need of the current
generation for greater information and facility of communication. But all is not well with the system since
it could not filter out a number of persons of ill will who would want to use cyberspace technology for
mischiefs and crimes. One of them can, for instance, avail himself of the system to unjustly ruin the
reputation of another or bully the latter by posting defamatory statements against him that people can
read.
And because linking with the internet opens up a user to communications from others, the ill-motivated
can use the cyberspace for committing theft by hacking into or surreptitiously accessing his bank account
or credit card or defrauding him through false representations. The wicked can use the cyberspace, too,
for illicit trafficking in sex or for exposing to pornography guileless children who have access to the
internet. For this reason, the government has a legitimate right to regulate the use of cyberspace and
contain and punish wrongdoings.
Notably, there are also those who would want, like vandals, to wreak or cause havoc to the computer
systems and networks of indispensable or highly useful institutions as well as to the laptop or computer
programs and memories of innocent individuals. They accomplish this by sending electronic viruses or
virtual dynamites that destroy those computer systems, networks, programs, and memories. The
government certainly has the duty and the right to prevent these tomfooleries from happening and punish
their perpetrators, hence the Cybercrime Prevention Act.
But petitioners claim that the means adopted by the cybercrime law for regulating undesirable cyberspace
activities violate certain of their constitutional rights. The government of course asserts that the law
merely seeks to reasonably put order into cyberspace activities, punish wrongdoings, and prevent hurtful
attacks on the system.
Pending hearing and adjudication of the issues presented in these cases, on February 5, 2013 the Court
extended the original 120-day temporary restraining order (TRO) that it earlier issued on October 9, 2012,
enjoining respondent government agencies from implementing the cybercrime law until further orders.
The Issues Presented
Petitioners challenge the constitutionality of the following provisions of the cybercrime law that regard
certain acts as crimes and impose penalties for their commission as well as provisions that would enable
the government to track down and penalize violators. These provisions are:
a. Section 4(a)(1) on Illegal Access;
b. Section 4(a)(3) on Data Interference;
c. Section 4(a)(6) on Cyber-squatting;
d. Section 4(b)(3) on Identity Theft;
e. Section 4(c)(1) on Cybersex;
f. Section 4(c)(2) on Child Pornography;
g. Section 4(c)(3) on Unsolicited Commercial Communications;
h. Section 4(c)(4) on Libel;
i. Section 5 on Aiding or Abetting and Attempt in the Commission of Cybercrimes;
j. Section 6 on the Penalty of One Degree Higher;
k. Section 7 on the Prosecution under both the Revised Penal Code (RPC) and R.A. 10175;
l. Section 8 on Penalties;
m. Section 12 on Real-Time Collection of Traffic Data;
n. Section 13 on Preservation of Computer Data;
o. Section 14 on Disclosure of Computer Data;
p. Section 15 on Search, Seizure and Examination of Computer Data;
q. Section 17 on Destruction of Computer Data;
r. Section 19 on Restricting or Blocking Access to Computer Data;
s. Section 20 on Obstruction of Justice;
t. Section 24 on Cybercrime Investigation and Coordinating Center (CICC); and
u. Section 26(a) on CICCs Powers and Functions.
Some petitioners also raise the constitutionality of related Articles 353, 354, 361, and 362 of the RPC on
the crime of libel.
The Rulings of the Court
Section 4(a)(1)
Section 4(a)(1) provides:
Section 4. Cybercrime Offenses. The following acts constitute the offense of cybercrime punishable
under this Act:
(a) Offenses against the confidentiality, integrity and availability of computer data and systems:
(1) Illegal Access. The access to the whole or any part of a computer system without right.
Petitioners contend that Section 4(a)(1) fails to meet the strict scrutiny standard required of laws that
interfere with the fundamental rights of the people and should thus be struck down.
The Court has in a way found the strict scrutiny standard, an American constitutional construct,1 useful in
determining the constitutionality of laws that tend to target a class of things or persons. According to this
standard, a legislative classification that impermissibly interferes with the exercise of fundamental right or
operates to the peculiar class disadvantage of a suspect class is presumed unconstitutional. The burden is
on the government to prove that the classification is necessary to achieve a compelling state interest and
that it is the least restrictive means to protect such interest.2 Later, the strict scrutiny standard was used to
assess the validity of laws dealing with the regulation of speech, gender, or race as well as other
fundamental rights, as expansion from its earlier applications to equal protection.3
In the cases before it, the Court finds nothing in Section 4(a)(1) that calls for the application of the strict
scrutiny standard since no fundamental freedom, like speech, is involved in punishing what is essentially
a condemnable act accessing the computer system of another without right. It is a universally
condemned conduct.4
Petitioners of course fear that this section will jeopardize the work of ethical hackers, professionals who
employ tools and techniques used by criminal hackers but would neither damage the target systems nor
steal information. Ethical hackers evaluate the target systems security and report back to the owners the
vulnerabilities they found in it and give instructions for how these can be remedied. Ethical hackers are
the equivalent of independent auditors who come into an organization to verify its bookkeeping records.5
Besides, a clients engagement of an ethical hacker requires an agreement between them as to the extent
of the search, the methods to be used, and the systems to be tested. This is referred to as the "get out of
jail free card."6Since the ethical hacker does his job with prior permission from the client, such
permission would insulate him from the coverage of Section 4(a)(1).
Section 4(a)(3) of the Cybercrime Law
under this Act:
xxxx
(3) Data Interference. The intentional or reckless alteration, damaging, deletion or deterioration of
computer data, electronic document, or electronic data message, without right, including the introduction
or transmission of viruses.
Petitioners claim that Section 4(a)(3) suffers from overbreadth in that, while it seeks to discourage data
interference, it intrudes into the area of protected speech and expression, creating a chilling and deterrent
effect on these guaranteed freedoms.
Under the overbreadth doctrine, a proper governmental purpose, constitutionally subject to state
regulation, may not be achieved by means that unnecessarily sweep its subject broadly, thereby invading
the area of protected freedoms.7 But Section 4(a)(3) does not encroach on these freedoms at all. It simply
punishes what essentially is a form of vandalism,8 the act of willfully destroying without right the things
that belong to others, in this case their computer data, electronic document, or electronic data message.
Such act has no connection to guaranteed freedoms. There is no freedom to destroy other peoples
computer systems and private documents.
All penal laws, like the cybercrime law, have of course an inherent chilling effect, an in terrorem
effect9 or the fear of possible prosecution that hangs on the heads of citizens who are minded to step
beyond the boundaries of what is proper. But to prevent the State from legislating criminal laws because
they instill such kind of fear is to render the state powerless in addressing and penalizing socially harmful
conduct.10 Here, the chilling effect that results in paralysis is an illusion since Section 4(a)(3) clearly
describes the evil that it seeks to punish and creates no tendency to intimidate the free exercise of ones
constitutional rights.
Besides, the overbreadth challenge places on petitioners the heavy burden of proving that under no set of
circumstances will Section 4(a)(3) be valid.11 Petitioner has failed to discharge this burden.
Section 4(a)(6) of the Cybercrime Law
under this Act:
xxxx
(6) Cyber-squatting. The acquisition of domain name over the internet in bad faith to profit, mislead,
destroy the reputation, and deprive others from registering the same, if such a domain name is:
(i) Similar, identical, or confusingly similar to an existing trademark registered with the appropriate
government agency at the time of the domain name registration;
(ii) Identical or in any way similar with the name of a person other than the registrant, in case of a
personal name; and
(iii) Acquired without right or with intellectual property interests in it.
Petitioners claim that Section 4(a)(6) or cyber-squatting violates the equal protection clause12 in that, not
being narrowly tailored, it will cause a user using his real name to suffer the same fate as those who use
aliases or take the name of another in satire, parody, or any other literary device. For example, supposing
there exists a well known billionaire-philanthropist named "Julio Gandolfo," the law would punish for
cyber-squatting both the person who registers such name because he claims it to be his pseudo-name and
another who registers the name because it happens to be his real name. Petitioners claim that, considering
the substantial distinction between the two, the law should recognize the difference.
But there is no real difference whether he uses "Julio Gandolfo" which happens to be his real name or use
it as a pseudo-name for it is the evil purpose for which he uses the name that the law condemns. The law
is reasonable in penalizing him for acquiring the domain name in bad faith to profit, mislead, destroy
reputation, or deprive others who are not ill-motivated of the rightful opportunity of registering the same.
The challenge to the constitutionality of Section 4(a)(6) on ground of denial of equal protection is
baseless.
Section 4(b)(3) of the Cybercrime Law
Section 4(b)(3) provides:
under this Act:
xxxx
b) Computer-related Offenses:
xxxx
(3) Computer-related Identity Theft. The intentional acquisition, use, misuse, transfer, possession,
alteration, or deletion of identifying information belonging to another, whether natural or juridical,
without right: Provided: that if no damage has yet been caused, the penalty imposable shall be one (1)
degree lower.
Petitioners claim that Section 4(b)(3) violates the constitutional rights to due process and to privacy and
correspondence, and transgresses the freedom of the press.
The right to privacy, or the right to be let alone, was institutionalized in the 1987 Constitution as a facet of
the right protected by the guarantee against unreasonable searches and seizures.13 But the Court
acknowledged its existence as early as 1968 in Morfe v. Mutuc,14 it ruled that the right to privacy exists
independently of its identification with liberty; it is in itself fully deserving of constitutional protection.
Relevant to any discussion of the right to privacy is the concept known as the "Zones of Privacy." The
Court explained in "In the Matter of the Petition for Issuance of Writ of Habeas Corpus of Sabio v.
Senator Gordon"15 the relevance of these zones to the right to privacy:
Zones of privacy are recognized and protected in our laws. Within these zones, any form of intrusion is
impermissible unless excused by law and in accordance with customary legal process. The meticulous
regard we accord to these zones arises not only from our conviction that the right to privacy is a
"constitutional right" and "the right most valued by civilized men," but also from our adherence to the
Universal Declaration of Human Rights which mandates that, "no one shall be subjected to arbitrary
interference with his privacy" and "everyone has the right to the protection of the law against such
interference or attacks."
Two constitutional guarantees create these zones of privacy: (a) the right against unreasonable
searches16 and seizures, which is the basis of the right to be let alone, and (b) the right to privacy of
communication and correspondence.17 In assessing the challenge that the State has impermissibly intruded
into these zones of privacy, a court must determine whether a person has exhibited a reasonable
expectation of privacy and, if so, whether that expectation has been violated by unreasonable government
intrusion.18
The usual identifying information regarding a person includes his name, his citizenship, his residence
address, his contact number, his place and date of birth, the name of his spouse if any, his occupation, and
similar data.19 The law punishes those who acquire or use such identifying information without right,
implicitly to cause damage. Petitioners simply fail to show how government effort to curb computer-
related identity theft violates the right to privacy and correspondence as well as the right to due process of
law.
Also, the charge of invalidity of this section based on the overbreadth doctrine will not hold water since
the specific conducts proscribed do not intrude into guaranteed freedoms like speech. Clearly, what this
section regulates are specific actions: the acquisition, use, misuse or deletion of personal identifying data
of another. There is no fundamental right to acquire anothers personal data.
Further, petitioners fear that Section 4(b)(3) violates the freedom of the press in that journalists would be
hindered from accessing the unrestricted user account of a person in the news to secure information about
him that could be published. But this is not the essence of identity theft that the law seeks to prohibit and
punish. Evidently, the theft of identity information must be intended for an illegitimate purpose.
Moreover, acquiring and disseminating information made public by the user himself cannot be regarded
as a form of theft.
The Court has defined intent to gain as an internal act which can be established through the overt acts of
the offender, and it may be presumed from the furtive taking of useful property pertaining to another,
unless special circumstances reveal a different intent on the part of the perpetrator.20 As such, the press,
whether in quest of news reporting or social investigation, has nothing to fear since a special circumstance
is present to negate intent to gain which is required by this Section.
Section 4(c)(1) of the Cybercrime Law
Section 4(c)(1) provides:
Sec. 4. Cybercrime Offenses. The following acts constitute the offense of cybercrime punishable under
this Act:
xxxx
(c) Content-related Offenses:
(1) Cybersex. The willful engagement, maintenance, control, or operation, directly or indirectly, of any
lascivious exhibition of sexual organs or sexual activity, with the aid of a computer system, for favor or
consideration.
Petitioners claim that the above violates the freedom of expression clause of the Constitution.21 They
express fear that private communications of sexual character between husband and wife or consenting
adults, which are not regarded as crimes under the penal code, would now be regarded as crimes when
done "for favor" in cyberspace. In common usage, the term "favor" includes "gracious kindness," "a
special privilege or right granted or conceded," or "a token of love (as a ribbon) usually worn
conspicuously."22 This meaning given to the term "favor" embraces socially tolerated trysts. The law as
written would invite law enforcement agencies into the bedrooms of married couples or consenting
individuals.
But the deliberations of the Bicameral Committee of Congress on this section of the Cybercrime
Prevention Act give a proper perspective on the issue. These deliberations show a lack of intent to
penalize a "private showing x x x between and among two private persons x x x although that may be a
form of obscenity to some."23 The understanding of those who drew up the cybercrime law is that the
element of "engaging in a business" is necessary to constitute the illegal cybersex.24 The Act actually
seeks to punish cyber prostitution, white slave trade, and pornography for favor and consideration. This
includes interactive prostitution and pornography, i.e., by webcam.25
The subject of Section 4(c)(1)lascivious exhibition of sexual organs or sexual activityis not novel.
Article 201 of the RPC punishes "obscene publications and exhibitions and indecent shows." The Anti-
Trafficking in Persons Act of 2003 penalizes those who "maintain or hire a person to engage in
prostitution or pornography."26 The law defines prostitution as any act, transaction, scheme, or design
involving the use of a person by another, for sexual intercourse or lascivious conduct in exchange for
money, profit, or any other consideration.27
The case of Nogales v. People28 shows the extent to which the State can regulate materials that serve no
other purpose than satisfy the market for violence, lust, or pornography.29 The Court weighed the property
rights of individuals against the public welfare. Private property, if containing pornographic materials,
may be forfeited and destroyed. Likewise, engaging in sexual acts privately through internet connection,
perceived by some as a right, has to be balanced with the mandate of the State to eradicate white slavery
and the exploitation of women.
In any event, consenting adults are protected by the wealth of jurisprudence delineating the bounds of
obscenity.30The Court will not declare Section 4(c)(1) unconstitutional where it stands a construction that
makes it apply only to persons engaged in the business of maintaining, controlling, or operating, directly
or indirectly, the lascivious exhibition of sexual organs or sexual activity with the aid of a computer
system as Congress has intended.
this Act:
xxxx
xxxx
(2) Child Pornography. The unlawful or prohibited acts defined and punishable by Republic Act No.
9775 or the Anti-Child Pornography Act of 2009, committed through a computer system: Provided, That
the penalty to be imposed shall be (1) one degree higher than that provided for in Republic Act No. 9775.
It seems that the above merely expands the scope of the Anti-Child Pornography Act of 200931 (ACPA) to
cover identical activities in cyberspace. In theory, nothing prevents the government from invoking the
ACPA when prosecuting persons who commit child pornography using a computer system. Actually,
ACPAs definition of child pornography already embraces the use of "electronic, mechanical, digital,
optical, magnetic or any other means." Notably, no one has questioned this ACPA provision.
Of course, the law makes the penalty higher by one degree when the crime is committed in cyberspace.
But no one can complain since the intensity or duration of penalty is a legislative prerogative and there is
rational basis for such higher penalty.32 The potential for uncontrolled proliferation of a particular piece of
child pornography when uploaded in the cyberspace is incalculable.
Petitioners point out that the provision of ACPA that makes it unlawful for any person to "produce, direct,
manufacture or create any form of child pornography"33 clearly relates to the prosecution of persons who
aid and abet the core offenses that ACPA seeks to punish.34 Petitioners are wary that a person who merely
doodles on paper and imagines a sexual abuse of a 16-year-old is not criminally liable for producing child
pornography but one who formulates the idea on his laptop would be. Further, if the author bounces off
his ideas on Twitter, anyone who replies to the tweet could be considered aiding and abetting a
cybercrime.
The question of aiding and abetting the offense by simply commenting on it will be discussed elsewhere
below. For now the Court must hold that the constitutionality of Section 4(c)(2) is not successfully
challenged.
this Act:
xxxx
xxxx
(3) Unsolicited Commercial Communications. The transmission of commercial electronic
communication with the use of computer system which seeks to advertise, sell, or offer for sale products
and services are prohibited unless:
(i) There is prior affirmative consent from the recipient; or
(ii) The primary intent of the communication is for service and/or administrative announcements from the
sender to its existing users, subscribers or customers; or
(iii) The following conditions are present:
(aa) The commercial electronic communication contains a simple, valid, and reliable way for the recipient
to reject receipt of further commercial electronic messages (opt-out) from the same source;
(bb) The commercial electronic communication does not purposely disguise the source of the electronic
message; and
(cc) The commercial electronic communication does not purposely include misleading information in any
part of the message in order to induce the recipients to read the message.
The above penalizes the transmission of unsolicited commercial communications, also known as "spam."
The term "spam" surfaced in early internet chat rooms and interactive fantasy games. One who repeats the
same sentence or comment was said to be making a "spam." The term referred to a Monty Pythons
Flying Circus scene in which actors would keep saying "Spam, Spam, Spam, and Spam" when reading
options from a menu.35
The Government, represented by the Solicitor General, points out that unsolicited commercial
communications or spams are a nuisance that wastes the storage and network capacities of internet service
providers, reduces the efficiency of commerce and technology, and interferes with the owners peaceful
enjoyment of his property. Transmitting spams amounts to trespass to ones privacy since the person
sending out spams enters the recipients domain without prior permission. The OSG contends that
commercial speech enjoys less protection in law.
But, firstly, the government presents no basis for holding that unsolicited electronic ads reduce the
"efficiency of computers." Secondly, people, before the arrival of the age of computers, have already been
receiving such unsolicited ads by mail. These have never been outlawed as nuisance since people might
have interest in such ads. What matters is that the recipient has the option of not opening or reading these
mail ads. That is true with spams. Their recipients always have the option to delete or not to read them.
To prohibit the transmission of unsolicited ads would deny a person the right to read his emails, even
unsolicited commercial ads addressed to him. Commercial speech is a separate category of speech which
is not accorded the same level of protection as that given to other constitutionally guaranteed forms of
expression but is nonetheless entitled to protection.36 The State cannot rob him of this right without
violating the constitutionally guaranteed freedom of expression. Unsolicited advertisements are legitimate
forms of expression.
Articles 353, 354, and 355 of the Penal Code
Section 4(c)(4) of the Cyber Crime Law
Petitioners dispute the constitutionality of both the penal code provisions on libel as well as Section
4(c)(4) of the Cybercrime Prevention Act on cyberlibel.
The RPC provisions on libel read:
Art. 353. Definition of libel. A libel is public and malicious imputation of a crime, or of a vice or
defect, real or imaginary, or any act, omission, condition, status, or circumstance tending to cause the
dishonor, discredit, or contempt of a natural or juridical person, or to blacken the memory of one who is
dead.
Art. 354. Requirement for publicity. Every defamatory imputation is presumed to be malicious, even if
it be true, if no good intention and justifiable motive for making it is shown, except in the following
cases:
1. A private communication made by any person to another in the performance of any legal, moral or
social duty; and
2. A fair and true report, made in good faith, without any comments or remarks, of any judicial,
legislative or other official proceedings which are not of confidential nature, or of any statement, report or
speech delivered in said proceedings, or of any other act performed by public officers in the exercise of
their functions.
Art. 355. Libel means by writings or similar means. A libel committed by means of writing, printing,
lithography, engraving, radio, phonograph, painting, theatrical exhibition, cinematographic exhibition, or
any similar means, shall be punished by prision correccional in its minimum and medium periods or a
fine ranging from 200 to 6,000 pesos, or both, in addition to the civil action which may be brought by the
offended party.
The libel provision of the cybercrime law, on the other hand, merely incorporates to form part of it the
provisions of the RPC on libel. Thus Section 4(c)(4) reads:
this Act:
xxxx
xxxx
(4) Libel. The unlawful or prohibited acts of libel as defined in Article 355 of the Revised Penal Code,
as amended, committed through a computer system or any other similar means which may be devised in
the future.
Petitioners lament that libel provisions of the penal code37 and, in effect, the libel provisions of the
cybercrime law carry with them the requirement of "presumed malice" even when the latest jurisprudence
already replaces it with the higher standard of "actual malice" as a basis for conviction. 38 Petitioners argue
that inferring "presumed malice" from the accuseds defamatory statement by virtue of Article 354 of the
penal code infringes on his constitutionally guaranteed freedom of expression.
Petitioners would go further. They contend that the laws on libel should be stricken down as
unconstitutional for otherwise good jurisprudence requiring "actual malice" could easily be overturned as
the Court has done in Fermin v. People39 even where the offended parties happened to be public figures.
The elements of libel are: (a) the allegation of a discreditable act or condition concerning another; (b)
publication of the charge; (c) identity of the person defamed; and (d) existence of malice.40
There is "actual malice" or malice in fact41 when the offender makes the defamatory statement with the
knowledge that it is false or with reckless disregard of whether it was false or not.42 The reckless
disregard standard used here requires a high degree of awareness of probable falsity. There must be
sufficient evidence to permit the conclusion that the accused in fact entertained serious doubts as to the
truth of the statement he published. Gross or even extreme negligence is not sufficient to establish actual
malice.43
The prosecution bears the burden of proving the presence of actual malice in instances where such
element is required to establish guilt. The defense of absence of actual malice, even when the statement
turns out to be false, is available where the offended party is a public official or a public figure, as in the
cases of Vasquez (a barangay official) and Borjal (the Executive Director, First National Conference on
Land Transportation). Since the penal code and implicitly, the cybercrime law, mainly target libel against
private persons, the Court recognizes that these laws imply a stricter standard of "malice" to convict the
author of a defamatory statement where the offended party is a public figure. Societys interest and the
maintenance of good government demand a full discussion of public affairs.44
Parenthetically, the Court cannot accept the proposition that its ruling in Fermin disregarded the higher
standard of actual malice or malice in fact when it found Cristinelli Fermin guilty of committing libel
against complainants who were public figures. Actually, the Court found the presence of malice in fact in
that case. Thus:
It can be gleaned from her testimony that petitioner had the motive to make defamatory imputations
against complainants. Thus, petitioner cannot, by simply making a general denial, convince us that there
was no malice on her part. Verily, not only was there malice in law, the article being malicious in itself,
but there was also malice in fact, as there was motive to talk ill against complainants during the electoral
campaign. (Emphasis ours)
Indeed, the Court took into account the relatively wide leeway given to utterances against public figures
in the above case, cinema and television personalities, when it modified the penalty of imprisonment to
just a fine of 6,000.00.
But, where the offended party is a private individual, the prosecution need not prove the presence of
malice. The law explicitly presumes its existence (malice in law) from the defamatory character of the
assailed statement.45 For his defense, the accused must show that he has a justifiable reason for the
defamatory statement even if it was in fact true.46
Petitioners peddle the view that both the penal code and the Cybercrime Prevention Act violate the
countrys obligations under the International Covenant of Civil and Political Rights (ICCPR). They point
out that in Adonis v. Republic of the Philippines,47 the United Nations Human Rights Committee
(UNHRC) cited its General Comment 34 to the effect that penal defamation laws should include the
defense of truth.
But General Comment 34 does not say that the truth of the defamatory statement should constitute an all-
encompassing defense. As it happens, Article 361 recognizes truth as a defense but under the condition
that the accused has been prompted in making the statement by good motives and for justifiable ends.
Thus:
Art. 361. Proof of the truth. In every criminal prosecution for libel, the truth may be given in evidence
to the court and if it appears that the matter charged as libelous is true, and, moreover, that it was
published with good motives and for justifiable ends, the defendants shall be acquitted.
Proof of the truth of an imputation of an act or omission not constituting a crime shall not be admitted,
unless the imputation shall have been made against Government employees with respect to facts related to
the discharge of their official duties.
In such cases if the defendant proves the truth of the imputation made by him, he shall be acquitted.
Besides, the UNHRC did not actually enjoin the Philippines, as petitioners urge, to decriminalize libel. It
simply suggested that defamation laws be crafted with care to ensure that they do not stifle freedom of
expression.48Indeed, the ICCPR states that although everyone should enjoy freedom of expression, its
exercise carries with it special duties and responsibilities. Free speech is not absolute. It is subject to
certain restrictions, as may be necessary and as may be provided by law.49
The Court agrees with the Solicitor General that libel is not a constitutionally protected speech and that
the government has an obligation to protect private individuals from defamation. Indeed, cyberlibel is
actually not a new crime since Article 353, in relation to Article 355 of the penal code, already punishes
it. In effect, Section 4(c)(4) above merely affirms that online defamation constitutes "similar means" for
committing libel.
But the Courts acquiescence goes only insofar as the cybercrime law penalizes the author of the libelous
statement or article. Cyberlibel brings with it certain intricacies, unheard of when the penal code
provisions on libel were enacted. The culture associated with internet media is distinct from that of print.
The internet is characterized as encouraging a freewheeling, anything-goes writing style.50 In a sense, they
are a world apart in terms of quickness of the readers reaction to defamatory statements posted in
cyberspace, facilitated by one-click reply options offered by the networking site as well as by the speed
with which such reactions are disseminated down the line to other internet users. Whether these reactions
to defamatory statement posted on the internet constitute aiding and abetting libel, acts that Section 5 of
the cybercrime law punishes, is another matter that the Court will deal with next in relation to Section 5 of
the law.
Section 5 of the Cybercrime Law
Section 5 provides:
Sec. 5. Other Offenses. The following acts shall also constitute an offense:
(a) Aiding or Abetting in the Commission of Cybercrime. Any person who willfully abets or aids in the
commission of any of the offenses enumerated in this Act shall be held liable.
(b) Attempt in the Commission of Cybercrime. Any person who willfully attempts to commit any of
the offenses enumerated in this Act shall be held liable.
Petitioners assail the constitutionality of Section 5 that renders criminally liable any person who willfully
abets or aids in the commission or attempts to commit any of the offenses enumerated as cybercrimes. It
suffers from overbreadth, creating a chilling and deterrent effect on protected expression.
The Solicitor General contends, however, that the current body of jurisprudence and laws on aiding and
abetting sufficiently protects the freedom of expression of "netizens," the multitude that avail themselves
of the services of the internet. He points out that existing laws and jurisprudence sufficiently delineate the
meaning of "aiding or abetting" a crime as to protect the innocent. The Solicitor General argues that plain,
ordinary, and common usage is at times sufficient to guide law enforcement agencies in enforcing the
law.51 The legislature is not required to define every single word contained in the laws they craft.
Aiding or abetting has of course well-defined meaning and application in existing laws. When a person
aids or abets another in destroying a forest,52 smuggling merchandise into the country,53 or interfering in
the peaceful picketing of laborers,54 his action is essentially physical and so is susceptible to easy
assessment as criminal in character. These forms of aiding or abetting lend themselves to the tests of
common sense and human experience.
But, when it comes to certain cybercrimes, the waters are muddier and the line of sight is somewhat
blurred. The idea of "aiding or abetting" wrongdoings online threatens the heretofore popular and
unchallenged dogmas of cyberspace use.
According to the 2011 Southeast Asia Digital Consumer Report, 33% of Filipinos have accessed the
internet within a year, translating to about 31 million users.55 Based on a recent survey, the Philippines
ranks 6th in the top 10 most engaged countries for social networking.56 Social networking sites build
social relations among people who, for example, share interests, activities, backgrounds, or real-life
connections.57
Two of the most popular of these sites are Facebook and Twitter. As of late 2012, 1.2 billion people with
shared interests use Facebook to get in touch.58 Users register at this site, create a personal profile or an
open book of who they are, add other users as friends, and exchange messages, including automatic
notifications when they update their profile.59 A user can post a statement, a photo, or a video on
Facebook, which can be made visible to anyone, depending on the users privacy settings.
If the post is made available to the public, meaning to everyone and not only to his friends, anyone on
Facebook can react to the posting, clicking any of several buttons of preferences on the programs screen
such as "Like," "Comment," or "Share." "Like" signifies that the reader likes the posting while
"Comment" enables him to post online his feelings or views about the same, such as "This is great!"
When a Facebook user "Shares" a posting, the original "posting" will appear on his own Facebook profile,
consequently making it visible to his down-line Facebook Friends.
Twitter, on the other hand, is an internet social networking and microblogging service that enables its
users to send and read short text-based messages of up to 140 characters. These are known as "Tweets."
Microblogging is the practice of posting small pieces of digital contentwhich could be in the form of
text, pictures, links, short videos, or other mediaon the internet. Instead of friends, a Twitter user has
"Followers," those who subscribe to this particular users posts, enabling them to read the same, and
"Following," those whom this particular user is subscribed to, enabling him to read their posts. Like
Facebook, a Twitter user can make his tweets available only to his Followers, or to the general public. If a
post is available to the public, any Twitter user can "Retweet" a given posting. Retweeting is just
reposting or republishing another persons tweet without the need of copying and pasting it.
In the cyberworld, there are many actors: a) the blogger who originates the assailed statement; b) the blog
service provider like Yahoo; c) the internet service provider like PLDT, Smart, Globe, or Sun; d) the
internet caf that may have provided the computer used for posting the blog; e) the person who makes a
favorable comment on the blog; and f) the person who posts a link to the blog site.60 Now, suppose Maria
(a blogger) maintains a blog on WordPress.com (blog service provider). She needs the internet to access
her blog so she subscribes to Sun Broadband (Internet Service Provider).
One day, Maria posts on her internet account the statement that a certain married public official has an
illicit affair with a movie star. Linda, one of Marias friends who sees this post, comments online, "Yes,
this is so true! They are so immoral." Marias original post is then multiplied by her friends and the
latters friends, and down the line to friends of friends almost ad infinitum. Nena, who is a stranger to
both Maria and Linda, comes across this blog, finds it interesting and so shares the link to this apparently
defamatory blog on her Twitter account. Nenas "Followers" then "Retweet" the link to that blog site.
Pamela, a Twitter user, stumbles upon a random persons "Retweet" of Nenas original tweet and posts
this on her Facebook account. Immediately, Pamelas Facebook Friends start Liking and making
Comments on the assailed posting. A lot of them even press the Share button, resulting in the further
spread of the original posting into tens, hundreds, thousands, and greater postings.
The question is: are online postings such as "Liking" an openly defamatory statement, "Commenting" on
it, or "Sharing" it with others, to be regarded as "aiding or abetting?" In libel in the physical world, if
Nestor places on the office bulletin board a small poster that says, "Armand is a thief!," he could certainly
be charged with libel. If Roger, seeing the poster, writes on it, "I like this!," that could not be libel since
he did not author the poster. If Arthur, passing by and noticing the poster, writes on it, "Correct!," would
that be libel? No, for he merely expresses agreement with the statement on the poster. He still is not its
author. Besides, it is not clear if aiding or abetting libel in the physical world is a crime.
But suppose Nestor posts the blog, "Armand is a thief!" on a social networking site. Would a reader and
his Friends or Followers, availing themselves of any of the "Like," "Comment," and "Share" reactions, be
guilty of aiding or abetting libel? And, in the complex world of cyberspace expressions of thoughts, when
will one be liable for aiding or abetting cybercrimes? Where is the venue of the crime?
Except for the original author of the assailed statement, the rest (those who pressed Like, Comment and
Share) are essentially knee-jerk sentiments of readers who may think little or haphazardly of their
response to the original posting. Will they be liable for aiding or abetting? And, considering the inherent
impossibility of joining hundreds or thousands of responding "Friends" or "Followers" in the criminal
charge to be filed in court, who will make a choice as to who should go to jail for the outbreak of the
challenged posting?
The old parameters for enforcing the traditional form of libel would be a square peg in a round hole when
applied to cyberspace libel. Unless the legislature crafts a cyber libel law that takes into account its unique
circumstances and culture, such law will tend to create a chilling effect on the millions that use this new
medium of communication in violation of their constitutionally-guaranteed right to freedom of
expression.
The United States Supreme Court faced the same issue in Reno v. American Civil Liberties Union,61 a
case involving the constitutionality of the Communications Decency Act of 1996. The law prohibited (1)
the knowing transmission, by means of a telecommunications device, of
"obscene or indecent" communications to any recipient under 18 years of age; and (2) the knowing use of
an interactive computer service to send to a specific person or persons under 18 years of age or to display
in a manner available to a person under 18 years of age communications that, in context, depict or
describe, in terms "patently offensive" as measured by contemporary community standards, sexual or
excretory activities or organs.
Those who challenged the Act claim that the law violated the First Amendments guarantee of freedom of
speech for being overbroad. The U.S. Supreme Court agreed and ruled:
The vagueness of the Communications Decency Act of 1996 (CDA), 47 U.S.C.S. 223, is a matter of
special concern for two reasons. First, the CDA is a content-based regulation of speech. The vagueness of
such a regulation raises special U.S. Const. amend. I concerns because of its obvious chilling effect on
free speech. Second, the CDA is a criminal statute. In addition to the opprobrium and stigma of a criminal
conviction, the CDA threatens violators with penalties including up to two years in prison for each act of
violation. The severity of criminal sanctions may well cause speakers to remain silent rather than
communicate even arguably unlawful words, ideas, and images. As a practical matter, this increased
deterrent effect, coupled with the risk of discriminatory enforcement of vague regulations, poses greater
U.S. Const. amend. I concerns than those implicated by certain civil regulations.
xxxx
The Communications Decency Act of 1996 (CDA), 47 U.S.C.S. 223, presents a great threat of
censoring speech that, in fact, falls outside the statute's scope. Given the vague contours of the coverage
of the statute, it unquestionably silences some speakers whose messages would be entitled to
constitutional protection. That danger provides further reason for insisting that the statute not be overly
broad. The CDAs burden on protected speech cannot be justified if it could be avoided by a more
carefully drafted statute. (Emphasis ours)
Libel in the cyberspace can of course stain a persons image with just one click of the mouse. Scurrilous
statements can spread and travel fast across the globe like bad news. Moreover, cyberlibel often goes
hand in hand with cyberbullying that oppresses the victim, his relatives, and friends, evoking from mild to
disastrous reactions. Still, a governmental purpose, which seeks to regulate the use of this cyberspace
communication technology to protect a persons reputation and peace of mind, cannot adopt means that
will unnecessarily and broadly sweep, invading the area of protected freedoms.62
If such means are adopted, self-inhibition borne of fear of what sinister predicaments await internet users
will suppress otherwise robust discussion of public issues. Democracy will be threatened and with it, all
liberties. Penal laws should provide reasonably clear guidelines for law enforcement officials and triers of
facts to prevent arbitrary and discriminatory enforcement.63 The terms "aiding or abetting" constitute
broad sweep that generates chilling effect on those who express themselves through cyberspace posts,
comments, and other messages.64 Hence, Section 5 of the cybercrime law that punishes "aiding or
abetting" libel on the cyberspace is a nullity.
When a penal statute encroaches upon the freedom of speech, a facial challenge grounded on the void-for-
vagueness doctrine is acceptable. The inapplicability of the doctrine must be carefully delineated. As
Justice Antonio T. Carpio explained in his dissent in Romualdez v. Commission on Elections,65 "we must
view these statements of the Court on the inapplicability of the overbreadth and vagueness doctrines to
penal statutes as appropriate only insofar as these doctrines are used to mount facial challenges to penal
statutes not involving free speech."
In an "as applied" challenge, the petitioner who claims a violation of his constitutional right can raise any
constitutional ground absence of due process, lack of fair notice, lack of ascertainable standards,
overbreadth, or vagueness. Here, one can challenge the constitutionality of a statute only if he asserts a
violation of his own rights. It prohibits one from assailing the constitutionality of the statute based solely
on the violation of the rights of third persons not before the court. This rule is also known as the
prohibition against third-party standing.66
But this rule admits of exceptions. A petitioner may for instance mount a "facial" challenge to the
constitutionality of a statute even if he claims no violation of his own rights under the assailed statute
where it involves free speech on grounds of overbreadth or vagueness of the statute.
The rationale for this exception is to counter the "chilling effect" on protected speech that comes from
statutes violating free speech. A person who does not know whether his speech constitutes a crime under
an overbroad or vague law may simply restrain himself from speaking in order to avoid being charged of
a crime. The overbroad or vague law thus chills him into silence.67
As already stated, the cyberspace is an incomparable, pervasive medium of communication. It is
inevitable that any government threat of punishment regarding certain uses of the medium creates a
chilling effect on the constitutionally-protected freedom of expression of the great masses that use it. In
this case, the particularly complex web of interaction on social media websites would give law enforcers
such latitude that they could arbitrarily or selectively enforce the law.
Who is to decide when to prosecute persons who boost the visibility of a posting on the internet by liking
it? Netizens are not given "fair notice" or warning as to what is criminal conduct and what is lawful
conduct. When a case is filed, how will the court ascertain whether or not one netizens comment aided
and abetted a cybercrime while another comment did not?
Of course, if the "Comment" does not merely react to the original posting but creates an altogether new
defamatory story against Armand like "He beats his wife and children," then that should be considered an
original posting published on the internet. Both the penal code and the cybercrime law clearly punish
authors of defamatory publications. Make no mistake, libel destroys reputations that society values.
Allowed to cascade in the internet, it will destroy relationships and, under certain circumstances, will
generate enmity and tension between social or economic groups, races, or religions, exacerbating existing
tension in their relationships.
In regard to the crime that targets child pornography, when "Google procures, stores, and indexes child
pornography and facilitates the completion of transactions involving the dissemination of child
pornography," does this make Google and its users aiders and abettors in the commission of child
pornography crimes?68 Byars highlights a feature in the American law on child pornography that the
Cybercrimes law lacksthe exemption of a provider or notably a plain user of interactive computer
service from civil liability for child pornography as follows:
No provider or user of an interactive computer service shall be treated as the publisher or speaker of any
information provided by another information content provider and cannot be held civilly liable for any
action voluntarily taken in good faith to restrict access to or availability of material that the provider or
user considers to be obscene...whether or not such material is constitutionally protected.69
When a person replies to a Tweet containing child pornography, he effectively republishes it whether
wittingly or unwittingly. Does this make him a willing accomplice to the distribution of child
pornography? When a user downloads the Facebook mobile application, the user may give consent to
Facebook to access his contact details. In this way, certain information is forwarded to third parties and
unsolicited commercial communication could be disseminated on the basis of this information.70 As the
source of this information, is the user aiding the distribution of this communication? The legislature needs
to address this clearly to relieve users of annoying fear of possible criminal prosecution.
Section 5 with respect to Section 4(c)(4) is unconstitutional. Its vagueness raises apprehension on the part
of internet users because of its obvious chilling effect on the freedom of expression, especially since the
crime of aiding or abetting ensnares all the actors in the cyberspace front in a fuzzy way. What is more, as
the petitioners point out, formal crimes such as libel are not punishable unless consummated.71 In the
absence of legislation tracing the interaction of netizens and their level of responsibility such as in other
countries, Section 5, in relation to Section 4(c)(4) on Libel, Section 4(c)(3) on Unsolicited Commercial
Communications, and Section 4(c)(2) on Child Pornography, cannot stand scrutiny.
But the crime of aiding or abetting the commission of cybercrimes under Section 5 should be permitted to
apply to Section 4(a)(1) on Illegal Access, Section 4(a)(2) on Illegal Interception, Section 4(a)(3) on Data
Interference, Section 4(a)(4) on System Interference, Section 4(a)(5) on Misuse of Devices, Section
4(a)(6) on Cyber-squatting, Section 4(b)(1) on Computer-related Forgery, Section 4(b)(2) on Computer-
related Fraud, Section 4(b)(3) on Computer-related Identity Theft, and Section 4(c)(1) on Cybersex. None
of these offenses borders on the exercise of the freedom of expression.
The crime of willfully attempting to commit any of these offenses is for the same reason not
objectionable. A hacker may for instance have done all that is necessary to illegally access another partys
computer system but the security employed by the systems lawful owner could frustrate his effort.
Another hacker may have gained access to usernames and passwords of others but fail to use these
because the system supervisor is alerted.72 If Section 5 that punishes any person who willfully attempts to
commit this specific offense is not upheld, the owner of the username and password could not file a
complaint against him for attempted hacking. But this is not right. The hacker should not be freed from
liability simply because of the vigilance of a lawful owner or his supervisor.
Petitioners of course claim that Section 5 lacks positive limits and could cover the innocent.73 While this
may be true with respect to cybercrimes that tend to sneak past the area of free expression, any attempt to
commit the other acts specified in Section 4(a)(1), Section 4(a)(2), Section 4(a)(3), Section 4(a)(4),
Section 4(a)(5), Section 4(a)(6), Section 4(b)(1), Section 4(b)(2), Section 4(b)(3), and Section 4(c)(1) as
well as the actors aiding and abetting the commission of such acts can be identified with some reasonable
certainty through adroit tracking of their works. Absent concrete proof of the same, the innocent will of
course be spared.
Section 6 provides:
Sec. 6. All crimes defined and penalized by the Revised Penal Code, as amended, and special laws, if
committed by, through and with the use of information and communications technologies shall be
covered by the relevant provisions of this Act: Provided, That the penalty to be imposed shall be one (1)
degree higher than that provided for by the Revised Penal Code, as amended, and special laws, as the case
may be.
Section 6 merely makes commission of existing crimes through the internet a qualifying circumstance. As
the Solicitor General points out, there exists a substantial distinction between crimes committed through
the use of information and communications technology and similar crimes committed using other means.
In using the technology in question, the offender often evades identification and is able to reach far more
victims or cause greater harm. The distinction, therefore, creates a basis for higher penalties for
cybercrimes.
Section 7 provides:
Sec. 7. Liability under Other Laws. A prosecution under this Act shall be without prejudice to any
liability for violation of any provision of the Revised Penal Code, as amended, or special laws.
The Solicitor General points out that Section 7 merely expresses the settled doctrine that a single set of
acts may be prosecuted and penalized simultaneously under two laws, a special law and the Revised Penal
Code. When two different laws define two crimes, prior jeopardy as to one does not bar prosecution of the
other although both offenses arise from the same fact, if each crime involves some important act which is
not an essential element of the other.74 With the exception of the crimes of online libel and online child
pornography, the Court would rather leave the determination of the correct application of Section 7 to
actual cases.
Online libel is different. There should be no question that if the published material on print, said to be
libelous, is again posted online or vice versa, that identical material cannot be the subject of two separate
libels. The two offenses, one a violation of Article 353 of the Revised Penal Code and the other a
violation of Section 4(c)(4) of R.A. 10175 involve essentially the same elements and are in fact one and
the same offense. Indeed, the OSG itself claims that online libel under Section 4(c)(4) is not a new crime
but is one already punished under Article 353. Section 4(c)(4) merely establishes the computer system as
another means of publication.75 Charging the offender under both laws would be a blatant violation of the
proscription against double jeopardy.76
The same is true with child pornography committed online. Section 4(c)(2) merely expands the ACPAs
scope so as to include identical activities in cyberspace. As previously discussed, ACPAs definition of
child pornography in fact already covers the use of "electronic, mechanical, digital, optical, magnetic or
any other means." Thus, charging the offender under both Section 4(c)(2) and ACPA would likewise be
tantamount to a violation of the constitutional prohibition against double jeopardy.
Section 8 provides:
Sec. 8. Penalties. Any person found guilty of any of the punishable acts enumerated in Sections 4(a)
and 4(b) of this Act shall be punished with imprisonment of prision mayor or a fine of at least Two
hundred thousand pesos (Ph200,000.00) up to a maximum amount commensurate to the damage
incurred or both.
Any person found guilty of the punishable act under Section 4(a)(5) shall be punished with imprisonment
of prision mayor or a fine of not more than Five hundred thousand pesos (Ph500,000.00) or both.
If punishable acts in Section 4(a) are committed against critical infrastructure, the penalty of reclusion
temporal or a fine of at least Five hundred thousand pesos (Ph500,000.00) up to maximum amount
commensurate to the damage incurred or both, shall be imposed.
Any person found guilty of any of the punishable acts enumerated in Section 4(c)(1) of this Act shall be
punished with imprisonment of prision mayor or a fine of at least Two hundred thousand pesos
(Ph200,000.00) but not exceeding One million pesos (Ph1,000,000.00) or both.
Any person found guilty of any of the punishable acts enumerated in Section 4(c)(2) of this Act shall be
punished with the penalties as enumerated in Republic Act No. 9775 or the "Anti-Child Pornography Act
of 2009:" Provided, That the penalty to be imposed shall be one (1) degree higher than that provided for
in Republic Act No. 9775, if committed through a computer system.
Any person found guilty of any of the punishable acts enumerated in Section 4(c)(3) shall be punished
with imprisonment of arresto mayor or a fine of at least Fifty thousand pesos (Ph50,000.00) but not
exceeding Two hundred fifty thousand pesos (Ph250,000.00) or both.
Any person found guilty of any of the punishable acts enumerated in Section 5 shall be punished with
imprisonment one (1) degree lower than that of the prescribed penalty for the offense or a fine of at least
One hundred thousand pesos (Ph100,000.00) but not exceeding Five hundred thousand pesos
(Ph500,000.00) or both.
Section 8 provides for the penalties for the following crimes: Sections 4(a) on Offenses Against the
Confidentiality, Integrity and Availability of Computer Data and Systems; 4(b) on Computer-related
Offenses; 4(a)(5) on Misuse of Devices; when the crime punishable under 4(a) is committed against
critical infrastructure; 4(c)(1) on Cybersex; 4(c)(2) on Child Pornography; 4(c)(3) on Unsolicited
Commercial Communications; and Section 5 on Aiding or Abetting, and Attempt in the Commission of
Cybercrime.
The matter of fixing penalties for the commission of crimes is as a rule a legislative prerogative. Here the
legislature prescribed a measure of severe penalties for what it regards as deleterious cybercrimes. They
appear proportionate to the evil sought to be punished. The power to determine penalties for offenses is
not diluted or improperly wielded simply because at some prior time the act or omission was but an
element of another offense or might just have been connected with another crime.77 Judges and
magistrates can only interpret and apply them and have no authority to modify or revise their range as
determined by the legislative department.
The courts should not encroach on this prerogative of the lawmaking body.78
Section 12 provides:
Sec. 12. Real-Time Collection of Traffic Data. Law enforcement authorities, with due cause, shall be
authorized to collect or record by technical or electronic means traffic data in real-time associated with
specified communications transmitted by means of a computer system.
Traffic data refer only to the communications origin, destination, route, time, date, size, duration, or type
of underlying service, but not content, nor identities.
All other data to be collected or seized or disclosed will require a court warrant.
Service providers are required to cooperate and assist law enforcement authorities in the collection or
recording of the above-stated information.
The court warrant required under this section shall only be issued or granted upon written application and
the examination under oath or affirmation of the applicant and the witnesses he may produce and the
showing: (1) that there are reasonable grounds to believe that any of the crimes enumerated hereinabove
has been committed, or is being committed, or is about to be committed; (2) that there are reasonable
grounds to believe that evidence that will be obtained is essential to the conviction of any person for, or to
the solution of, or to the prevention of, any such crimes; and (3) that there are no other means readily
available for obtaining such evidence.
Petitioners assail the grant to law enforcement agencies of the power to collect or record traffic data in
real time as tending to curtail civil liberties or provide opportunities for official abuse. They claim that
data showing where digital messages come from, what kind they are, and where they are destined need
not be incriminating to their senders or recipients before they are to be protected. Petitioners invoke the
right of every individual to privacy and to be protected from government snooping into the messages or
information that they send to one another.
The first question is whether or not Section 12 has a proper governmental purpose since a law may
require the disclosure of matters normally considered private but then only upon showing that such
requirement has a rational relation to the purpose of the law,79 that there is a compelling State interest
behind the law, and that the provision itself is narrowly drawn.80 In assessing regulations affecting privacy
rights, courts should balance the legitimate concerns of the State against constitutional guarantees. 81
Undoubtedly, the State has a compelling interest in enacting the cybercrime law for there is a need to put
order to the tremendous activities in cyberspace for public good.82 To do this, it is within the realm of
reason that the government should be able to monitor traffic data to enhance its ability to combat all sorts
of cybercrimes.
Chapter IV of the cybercrime law, of which the collection or recording of traffic data is a part, aims to
provide law enforcement authorities with the power they need for spotting, preventing, and investigating
crimes committed in cyberspace. Crime-fighting is a state business. Indeed, as Chief Justice Sereno points
out, the Budapest Convention on Cybercrimes requires signatory countries to adopt legislative measures
to empower state authorities to collect or record "traffic data, in real time, associated with specified
communications."83 And this is precisely what Section 12 does. It empowers law enforcement agencies in
this country to collect or record such data.
But is not evidence of yesterdays traffic data, like the scene of the crime after it has been committed,
adequate for fighting cybercrimes and, therefore, real-time data is superfluous for that purpose?
Evidently, it is not. Those who commit the crimes of accessing a computer system without
right,84 transmitting viruses,85 lasciviously exhibiting sexual organs or sexual activity for favor or
consideration;86 and producing child pornography87 could easily evade detection and prosecution by
simply moving the physical location of their computers or laptops from day to day. In this digital age, the
wicked can commit cybercrimes from virtually anywhere: from internet cafs, from kindred places that
provide free internet services, and from unregistered mobile internet connectors. Criminals using
cellphones under pre-paid arrangements and with unregistered SIM cards do not have listed addresses and
can neither be located nor identified. There are many ways the cyber criminals can quickly erase their
tracks. Those who peddle child pornography could use relays of computers to mislead law enforcement
authorities regarding their places of operations. Evidently, it is only real-time traffic data collection or
recording and a subsequent recourse to court-issued search and seizure warrant that can succeed in
ferreting them out.
Petitioners of course point out that the provisions of Section 12 are too broad and do not provide ample
safeguards against crossing legal boundaries and invading the peoples right to privacy. The concern is
understandable. Indeed, the Court recognizes in Morfe v. Mutuc88 that certain constitutional guarantees
work together to create zones of privacy wherein governmental powers may not intrude, and that there
exists an independent constitutional right of privacy. Such right to be left alone has been regarded as the
beginning of all freedoms.89
But that right is not unqualified. In Whalen v. Roe,90 the United States Supreme Court classified privacy
into two categories: decisional privacy and informational privacy. Decisional privacy involves the right to
independence in making certain important decisions, while informational privacy refers to the interest in
avoiding disclosure of personal matters. It is the latter rightthe right to informational privacythat
those who oppose government collection or recording of traffic data in real-time seek to protect.
Informational privacy has two aspects: the right not to have private information disclosed, and the right to
live freely without surveillance and intrusion.91 In determining whether or not a matter is entitled to the
right to privacy, this Court has laid down a two-fold test. The first is a subjective test, where one claiming
the right must have an actual or legitimate expectation of privacy over a certain matter. The second is an
objective test, where his or her expectation of privacy must be one society is prepared to accept as
objectively reasonable.92
Since the validity of the cybercrime law is being challenged, not in relation to its application to a
particular person or group, petitioners challenge to Section 12 applies to all information and
communications technology (ICT) users, meaning the large segment of the population who use all sorts of
electronic devices to communicate with one another. Consequently, the expectation of privacy is to be
measured from the general publics point of view. Without reasonable expectation of privacy, the right to
it would have no basis in fact.
As the Solicitor General points out, an ordinary ICT user who courses his communication through a
service provider, must of necessity disclose to the latter, a third person, the traffic data needed for
connecting him to the recipient ICT user. For example, an ICT user who writes a text message intended
for another ICT user must furnish his service provider with his cellphone number and the cellphone
number of his recipient, accompanying the message sent. It is this information that creates the traffic data.
Transmitting communications is akin to putting a letter in an envelope properly addressed, sealing it
closed, and sending it through the postal service. Those who post letters have no expectations that no one
will read the information appearing outside the envelope.
Computer datamessages of all kindstravel across the internet in packets and in a way that may be
likened to parcels of letters or things that are sent through the posts. When data is sent from any one
source, the content is broken up into packets and around each of these packets is a wrapper or header.
This header contains the traffic data: information that tells computers where the packet originated, what
kind of data is in the packet (SMS, voice call, video, internet chat messages, email, online browsing data,
etc.), where the packet is going, and how the packet fits together with other packets.93 The difference is
that traffic data sent through the internet at times across the ocean do not disclose the actual names and
addresses (residential or office) of the sender and the recipient, only their coded internet protocol (IP)
addresses. The packets travel from one computer system to another where their contents are pieced back
together.
Section 12 does not permit law enforcement authorities to look into the contents of the messages and
uncover the identities of the sender and the recipient.
For example, when one calls to speak to another through his cellphone, the service providers
communications system will put his voice message into packets and send them to the other persons
cellphone where they are refitted together and heard. The latters spoken reply is sent to the caller in the
same way. To be connected by the service provider, the sender reveals his cellphone number to the
service provider when he puts his call through. He also reveals the cellphone number to the person he
calls. The other ways of communicating electronically follow the same basic pattern.
In Smith v. Maryland,94 cited by the Solicitor General, the United States Supreme Court reasoned that
telephone users in the 70s must realize that they necessarily convey phone numbers to the telephone
company in order to complete a call. That Court ruled that even if there is an expectation that phone
numbers one dials should remain private, such expectation is not one that society is prepared to recognize
as reasonable.
In much the same way, ICT users must know that they cannot communicate or exchange data with one
another over cyberspace except through some service providers to whom they must submit certain traffic
data that are needed for a successful cyberspace communication. The conveyance of this data takes them
out of the private sphere, making the expectation to privacy in regard to them an expectation that society
is not prepared to recognize as reasonable.
The Court, however, agrees with Justices Carpio and Brion that when seemingly random bits of traffic
data are gathered in bulk, pooled together, and analyzed, they reveal patterns of activities which can then
be used to create profiles of the persons under surveillance. With enough traffic data, analysts may be
able to determine a persons close associations, religious views, political affiliations, even sexual
preferences. Such information is likely beyond what the public may expect to be disclosed, and clearly
falls within matters protected by the right to privacy. But has the procedure that Section 12 of the law
provides been drawn narrowly enough to protect individual rights?
Section 12 empowers law enforcement authorities, "with due cause," to collect or record by technical or
electronic means traffic data in real-time. Petitioners point out that the phrase "due cause" has no
precedent in law or jurisprudence and that whether there is due cause or not is left to the discretion of the
police. Replying to this, the Solicitor General asserts that Congress is not required to define the meaning
of every word it uses in drafting the law.
Indeed, courts are able to save vague provisions of law through statutory construction. But the cybercrime
law, dealing with a novel situation, fails to hint at the meaning it intends for the phrase "due cause." The
Solicitor General suggests that "due cause" should mean "just reason or motive" and "adherence to a
lawful procedure." But the Court cannot draw this meaning since Section 12 does not even bother to
relate the collection of data to the probable commission of a particular crime. It just says, "with due
cause," thus justifying a general gathering of data. It is akin to the use of a general search warrant that the
Constitution prohibits.
Due cause is also not descriptive of the purpose for which data collection will be used. Will the law
enforcement agencies use the traffic data to identify the perpetrator of a cyber attack? Or will it be used to
build up a case against an identified suspect? Can the data be used to prevent cybercrimes from
happening?
The authority that Section 12 gives law enforcement agencies is too sweeping and lacks restraint. While it
says that traffic data collection should not disclose identities or content data, such restraint is but an
illusion. Admittedly, nothing can prevent law enforcement agencies holding these data in their hands from
looking into the identity of their sender or receiver and what the data contains. This will unnecessarily
expose the citizenry to leaked information or, worse, to extortion from certain bad elements in these
agencies.
Section 12, of course, limits the collection of traffic data to those "associated with specified
communications." But this supposed limitation is no limitation at all since, evidently, it is the law
enforcement agencies that would specify the target communications. The power is virtually limitless,
enabling law enforcement authorities to engage in "fishing expedition," choosing whatever specified
communication they want. This evidently threatens the right of individuals to privacy.
The Solicitor General points out that Section 12 needs to authorize collection of traffic data "in real time"
because it is not possible to get a court warrant that would authorize the search of what is akin to a
"moving vehicle." But warrantless search is associated with a police officers determination of probable
cause that a crime has been committed, that there is no opportunity for getting a warrant, and that unless
the search is immediately carried out, the thing to be searched stands to be removed. These preconditions
are not provided in Section 12.
The Solicitor General is honest enough to admit that Section 12 provides minimal protection to internet
users and that the procedure envisioned by the law could be better served by providing for more robust
safeguards. His bare assurance that law enforcement authorities will not abuse the provisions of Section
12 is of course not enough. The grant of the power to track cyberspace communications in real time and
determine their sources and destinations must be narrowly drawn to preclude abuses.95
Petitioners also ask that the Court strike down Section 12 for being violative of the void-for-vagueness
doctrine and the overbreadth doctrine. These doctrines however, have been consistently held by this Court
to apply only to free speech cases. But Section 12 on its own neither regulates nor punishes any type of
speech. Therefore, such analysis is unnecessary.
This Court is mindful that advances in technology allow the government and kindred institutions to
monitor individuals and place them under surveillance in ways that have previously been impractical or
even impossible. "All the forces of a technological age x x x operate to narrow the area of privacy and
facilitate intrusions into it. In modern terms, the capacity to maintain and support this enclave of private
life marks the difference between a democratic and a totalitarian society."96 The Court must ensure that
laws seeking to take advantage of these technologies be written with specificity and definiteness as to
ensure respect for the rights that the Constitution guarantees.
Sec. 13. Preservation of Computer Data. The integrity of traffic data and subscriber information
relating to communication services provided by a service provider shall be preserved for a minimum
period of six (6) months from the date of the transaction. Content data shall be similarly preserved for six
(6) months from the date of receipt of the order from law enforcement authorities requiring its
preservation.
Law enforcement authorities may order a one-time extension for another six (6) months: Provided, That
once computer data preserved, transmitted or stored by a service provider is used as evidence in a case,
the mere furnishing to such service provider of the transmittal document to the Office of the Prosecutor
shall be deemed a notification to preserve the computer data until the termination of the case.
The service provider ordered to preserve computer data shall keep confidential the order and its
compliance.
Petitioners in G.R. 20339197 claim that Section 13 constitutes an undue deprivation of the right to
property. They liken the data preservation order that law enforcement authorities are to issue as a form of
garnishment of personal property in civil forfeiture proceedings. Such order prevents internet users from
accessing and disposing of traffic data that essentially belong to them.
No doubt, the contents of materials sent or received through the internet belong to their authors or
recipients and are to be considered private communications. But it is not clear that a service provider has
an obligation to indefinitely keep a copy of the same as they pass its system for the benefit of users. By
virtue of Section 13, however, the law now requires service providers to keep traffic data and subscriber
information relating to communication services for at least six months from the date of the transaction and
those relating to content data for at least six months from receipt of the order for their preservation.
Actually, the user ought to have kept a copy of that data when it crossed his computer if he was so
minded. The service provider has never assumed responsibility for their loss or deletion while in its keep.
At any rate, as the Solicitor General correctly points out, the data that service providers preserve on orders
of law enforcement authorities are not made inaccessible to users by reason of the issuance of such orders.
The process of preserving data will not unduly hamper the normal transmission or use of the same.
Sec. 14. Disclosure of Computer Data. Law enforcement authorities, upon securing a court warrant,
shall issue an order requiring any person or service provider to disclose or submit subscribers
information, traffic data or relevant data in his/its possession or control within seventy-two (72) hours
from receipt of the order in relation to a valid complaint officially docketed and assigned for investigation
and the disclosure is necessary and relevant for the purpose of investigation.
The process envisioned in Section 14 is being likened to the issuance of a subpoena. Petitioners objection
is that the issuance of subpoenas is a judicial function. But it is well-settled that the power to issue
subpoenas is not exclusively a judicial function. Executive agencies have the power to issue subpoena as
an adjunct of their investigatory powers.98
Besides, what Section 14 envisions is merely the enforcement of a duly issued court warrant, a function
usually lodged in the hands of law enforcers to enable them to carry out their executive functions. The
prescribed procedure for disclosure would not constitute an unlawful search or seizure nor would it
violate the privacy of communications and correspondence. Disclosure can be made only after judicial
intervention.
Sec. 15. Search, Seizure and Examination of Computer Data. Where a search and seizure warrant is
properly issued, the law enforcement authorities shall likewise have the following powers and duties.
Within the time period specified in the warrant, to conduct interception, as defined in this Act, and:
(a) To secure a computer system or a computer data storage medium;
(b) To make and retain a copy of those computer data secured;
(c) To maintain the integrity of the relevant stored computer data;
(d) To conduct forensic analysis or examination of the computer data storage medium; and
(e) To render inaccessible or remove those computer data in the accessed computer or computer and
communications network.
Pursuant thereof, the law enforcement authorities may order any person who has knowledge about the
functioning of the computer system and the measures to protect and preserve the computer data therein to
provide, as is reasonable, the necessary information, to enable the undertaking of the search, seizure and
examination.
Law enforcement authorities may request for an extension of time to complete the examination of the
computer data storage medium and to make a return thereon but in no case for a period longer than thirty
(30) days from date of approval by the court.
Petitioners challenge Section 15 on the assumption that it will supplant established search and seizure
procedures. On its face, however, Section 15 merely enumerates the duties of law enforcement authorities
that would ensure the proper collection, preservation, and use of computer system or data that have been
seized by virtue of a court warrant. The exercise of these duties do not pose any threat on the rights of the
person from whom they were taken. Section 15 does not appear to supersede existing search and seizure
rules but merely supplements them.
Sec. 17. Destruction of Computer Data. Upon expiration of the periods as provided in Sections 13 and
15, service providers and law enforcement authorities, as the case may be, shall immediately and
completely destroy the computer data subject of a preservation and examination.
Section 17 would have the computer data, previous subject of preservation or examination, destroyed or
deleted upon the lapse of the prescribed period. The Solicitor General justifies this as necessary to clear
up the service providers storage systems and prevent overload. It would also ensure that investigations
are quickly concluded.
Petitioners claim that such destruction of computer data subject of previous preservation or examination
violates the users right against deprivation of property without due process of law. But, as already stated,
it is unclear that the user has a demandable right to require the service provider to have that copy of the
data saved indefinitely for him in its storage system. If he wanted them preserved, he should have saved
them in his computer when he generated the data or received it. He could also request the service provider
for a copy before it is deleted.
Section 19 empowers the Department of Justice to restrict or block access to computer data:
Sec. 19. Restricting or Blocking Access to Computer Data. When a computer data is prima facie found
to be in violation of the provisions of this Act, the DOJ shall issue an order to restrict or block access to
such computer data.
Petitioners contest Section 19 in that it stifles freedom of expression and violates the right against
unreasonable searches and seizures. The Solicitor General concedes that this provision may be
unconstitutional. But since laws enjoy a presumption of constitutionality, the Court must satisfy itself that
Section 19 indeed violates the freedom and right mentioned.
Computer data99 may refer to entire programs or lines of code, including malware, as well as files that
contain texts, images, audio, or video recordings. Without having to go into a lengthy discussion of
property rights in the digital space, it is indisputable that computer data, produced or created by their
writers or authors may constitute personal property. Consequently, they are protected from unreasonable
searches and seizures, whether while stored in their personal computers or in the service providers
systems.
Section 2, Article III of the 1987 Constitution provides that the right to be secure in ones papers and
effects against unreasonable searches and seizures of whatever nature and for any purpose shall be
inviolable. Further, it states that no search warrant shall issue except upon probable cause to be
determined personally by the judge. Here, the Government, in effect, seizes and places the computer data
under its control and disposition without a warrant. The Department of Justice order cannot substitute for
judicial search warrant.
The content of the computer data can also constitute speech. In such a case, Section 19 operates as a
restriction on the freedom of expression over cyberspace. Certainly not all forms of speech are protected.
Legislature may, within constitutional bounds, declare certain kinds of expression as illegal. But for an
executive officer to seize content alleged to be unprotected without any judicial warrant, it is not enough
for him to be of the opinion that such content violates some law, for to do so would make him judge, jury,
and executioner all rolled into one.100
Not only does Section 19 preclude any judicial intervention, but it also disregards jurisprudential
guidelines established to determine the validity of restrictions on speech. Restraints on free speech are
generally evaluated on one of or a combination of three tests: the dangerous tendency doctrine, the
balancing of interest test, and the clear and present danger rule.101 Section 19, however, merely requires
that the data to be blocked be found prima facie in violation of any provision of the cybercrime law.
Taking Section 6 into consideration, this can actually be made to apply in relation to any penal provision.
It does not take into consideration any of the three tests mentioned above.
The Court is therefore compelled to strike down Section 19 for being violative of the constitutional
guarantees to freedom of expression and against unreasonable searches and seizures.
Sec. 20. Noncompliance. Failure to comply with the provisions of Chapter IV hereof specifically the
orders from law enforcement authorities shall be punished as a violation of Presidential Decree No. 1829
with imprisonment of prision correctional in its maximum period or a fine of One hundred thousand pesos
(Php100,000.00) or both, for each and every noncompliance with an order issued by law enforcement
authorities.
Petitioners challenge Section 20, alleging that it is a bill of attainder. The argument is that the mere failure
to comply constitutes a legislative finding of guilt, without regard to situations where non-compliance
would be reasonable or valid.
But since the non-compliance would be punished as a violation of Presidential Decree (P.D.)
1829,102 Section 20 necessarily incorporates elements of the offense which are defined therein. If
Congress had intended for Section 20 to constitute an offense in and of itself, it would not have had to
make reference to any other statue or provision.
P.D. 1829 states:
Section 1. The penalty of prision correccional in its maximum period, or a fine ranging from 1,000 to
6,000 pesos, or both, shall be imposed upon any person who knowingly or willfully obstructs, impedes,
frustrates or delays the apprehension of suspects and the investigation and prosecution of criminal cases
by committing any of the following acts:
x x x.
Thus, the act of non-compliance, for it to be punishable, must still be done "knowingly or willfully."
There must still be a judicial determination of guilt, during which, as the Solicitor General assumes,
defense and justifications for non-compliance may be raised. Thus, Section 20 is valid insofar as it applies
to the provisions of Chapter IV which are not struck down by the Court.
Sections 24 and 26(a) of the Cybercrime Law
Sections 24 and 26(a) provide:
Sec. 24. Cybercrime Investigation and Coordinating Center. There is hereby created, within thirty (30)
days from the effectivity of this Act, an inter-agency body to be known as the Cybercrime Investigation
and Coordinating Center (CICC), under the administrative supervision of the Office of the President, for
policy coordination among concerned agencies and for the formulation and enforcement of the national
cybersecurity plan.
Sec. 26. Powers and Functions. The CICC shall have the following powers and functions:
(a) To formulate a national cybersecurity plan and extend immediate assistance of real time commission
of cybercrime offenses through a computer emergency response team (CERT); x x x.
Petitioners mainly contend that Congress invalidly delegated its power when it gave the Cybercrime
Investigation and Coordinating Center (CICC) the power to formulate a national cybersecurity plan
without any sufficient standards or parameters for it to follow.
In order to determine whether there is undue delegation of legislative power, the Court has adopted two
tests: the completeness test and the sufficient standard test. Under the first test, the law must be complete
in all its terms and conditions when it leaves the legislature such that when it reaches the delegate, the
only thing he will have to do is to enforce it.1avvphi1 The second test mandates adequate guidelines or
limitations in the law to determine the boundaries of the delegates authority and prevent the delegation
from running riot.103
Here, the cybercrime law is complete in itself when it directed the CICC to formulate and implement a
national cybersecurity plan. Also, contrary to the position of the petitioners, the law gave sufficient
standards for the CICC to follow when it provided a definition of cybersecurity.
Cybersecurity refers to the collection of tools, policies, risk management approaches, actions, training,
best practices, assurance and technologies that can be used to protect cyber environment and organization
and users assets.104 This definition serves as the parameters within which CICC should work in
formulating the cybersecurity plan.
Further, the formulation of the cybersecurity plan is consistent with the policy of the law to "prevent and
combat such [cyber] offenses by facilitating their detection, investigation, and prosecution at both the
domestic and international levels, and by providing arrangements for fast and reliable international
cooperation."105 This policy is clearly adopted in the interest of law and order, which has been considered
as sufficient standard.106 Hence, Sections 24 and 26(a) are likewise valid.
WHEREFORE, the Court DECLARES:
1. VOID for being UNCONSTITUTIONAL:
a. Section 4(c)(3) of Republic Act 10175 that penalizes posting of unsolicited commercial
communications;
b. Section 12 that authorizes the collection or recording of traffic data in real-time; and
c. Section 19 of the same Act that authorizes the Department of Justice to restrict or block access to
suspected Computer Data.
2. VALID and CONSTITUTIONAL:
a. Section 4(a)(1) that penalizes accessing a computer system without right;
b. Section 4(a)(3) that penalizes data interference, including transmission of viruses;
c. Section 4(a)(6) that penalizes cyber-squatting or acquiring domain name over the internet in bad faith
to the prejudice of others;
d. Section 4(b)(3) that penalizes identity theft or the use or misuse of identifying information belonging to
another;
e. Section 4(c)(1) that penalizes cybersex or the lascivious exhibition of sexual organs or sexual activity
for favor or consideration;
f. Section 4(c)(2) that penalizes the production of child pornography;
g. Section 6 that imposes penalties one degree higher when crimes defined under the Revised Penal Code
are committed with the use of information and communications technologies;
h. Section 8 that prescribes the penalties for cybercrimes;
i. Section 13 that permits law enforcement authorities to require service providers to preserve traffic data
and subscriber information as well as specified content data for six months;
j. Section 14 that authorizes the disclosure of computer data under a court-issued warrant;
k. Section 15 that authorizes the search, seizure, and examination of computer data under a court-issued
warrant;
l. Section 17 that authorizes the destruction of previously preserved computer data after the expiration of
the prescribed holding periods;
m. Section 20 that penalizes obstruction of justice in relation to cybercrime investigations;
n. Section 24 that establishes a Cybercrime Investigation and Coordinating Center (CICC);
o. Section 26(a) that defines the CICCs Powers and Functions; and
p. Articles 353, 354, 361, and 362 of the Revised Penal Code that penalizes libel.
Further, the Court DECLARES:
1. Section 4(c)(4) that penalizes online libel as VALID and CONSTITUTIONAL with respect to the
original author of the post; but VOID and UNCONSTITUTIONAL with respect to others who simply
receive the post and react to it; and
2. Section 5 that penalizes aiding or abetting and attempt in the commission of cybercrimes as VA L I D
and CONSTITUTIONAL only in relation to Section 4(a)(1) on Illegal Access, Section 4(a)(2) on Illegal
Interception, Section 4(a)(3) on Data Interference, Section 4(a)(4) on System
Interference, Section 4(a)(5) on Misuse of Devices, Section 4(a)(6) on Cyber-squatting, Section 4(b)(1)
on Computer-related Forgery, Section 4(b)(2) on Computer-related Fraud, Section 4(b)(3) on Computer-
related Identity Theft, and Section 4(c)(1) on Cybersex; but VOID and UNCONSTITUTIONAL with
respect to Sections 4(c)(2) on Child Pornography, 4(c)(3) on Unsolicited Commercial Communications,
and 4(c)(4) on online Libel.1wphi1
Lastly, the Court RESOLVES to LEAVE THE DETERMINATION of the correct application of Section
7 that authorizes prosecution of the offender under both the Revised Penal Code and Republic Act 10175
to actual cases, WITH THE EXCEPTION of the crimes of:
1. Online libel as to which, charging the offender under both Section 4(c)(4) of Republic Act 10175 and
Article 353 of the Revised Penal Code constitutes a violation of the proscription against double jeopardy;
as well as
2. Child pornography committed online as to which, charging the offender under both Section 4(c)(2) of
Republic Act 10175 and Republic Act 9775 or the Anti-Child Pornography Act of 2009 also constitutes a
violation of the same proscription, and, in respect to these, is VOID and UNCONSTITUTIONAL.
SO ORDERED.
ROBERTO A. ABAD
Associate Justice
WE CONCUR:
See Concurring & Dissenting Opinion
MARIA LOURDES P. A. SERENO
Chief Justice
See Concurring & Dissenting Opinion (no part due to prior case)
ANTONIO T. CARPIO PRESBITERO J. VELASCO, JR.*
TERESITA J. LEONARDO-DE See Separate Concurring Opinion

CASTRO ARTURO D. BRION
DIOSDADO M. PERALTA LUCAS P. BERSAMIN

MARIANO C. DEL CASTILLO MARTIN S. VILLARAMA, JR.

I join Justice Brion in all his positions

JOSE PORTUGAL PEREZ
JOSE CATRAL MENDOZA
Associate Justice
Associate Justice
No Part
BIENVENIDO L. REYES
ESTELA M. PERLAS-BERNABE*
Associate Justice
Associate Justice
See separate dissenting and concurring opinion

MARVIC MARIO VICTOR F. LEONEN
Associate Justice
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the
above Decision had been reached in consultation before the case was assigned to the writer of the opinion
of the Court.
MARIA LOURDES P.A. SERENO
Chief Justice
Footnotes
*No part.
1
The US Supreme Court first suggested the standard by implication in footnote 4 of United States v.
Carolene Products (304 U.S. 144, 152 n.4 (1938). See Fatal in Theory and Strict in Fact: An Empirical
Analysis of Strict Scrutiny in the Federal Courts. Winkler, A. UCLA School of Law, Public Law & Legal
Theory Research Paper Series, Research Paper No. 06-14, http://ssrn.com/abstract=897360 (last accessed
April 10, 2013).
2
Serrano v. Gallant Maritime Services, Inc., G.R. No. 167614, March 24, 2009, 582 SCRA 254, 278.
3
White Light Corporation v. City of Manila, G.R. No. 122846, January 20, 2009, 576 SCRA 416, 437.
4
All 50 states of the United States have passed individual state laws criminalizing hacking or
unauthorized access, http://www.ncsl.org/issues-research/telecom/computer-hacking-and-unauthorized-
access-laws.aspx (last accessed May 16, 2013). The United States Congress has also passed the Computer
Fraud and Abuse Act 18 U.S.C. 1030 that penalizes, among others, hacking. The Budapest Convention
on Cybercrime considers hacking as an offense against the confidentiality, integrity and availability of
computer data and systems and 29 countries have already ratified or acceded,
http://conventions.coe.int/Treaty/Commun/ChercheSig.asp?NT=185&CM=&DF=&CL=ENG (last
accessed May 16, 2013).
5
Ethical Hacking. Palmer, C. IBM Systems Journal, Vol. 40, No. 3, 2001, p. 770,
http://pdf.textfiles.com/security/palmer.pdf (last accessed April 10, 2013).
6
Id. at 774.
7
Southern Hemisphere Engagement Network, Inc. v. Anti-Terrorism Council, G.R. Nos. 178552,
178554, 178581, 178890, 179157 & 179461, October 5, 2010, 632 SCRA 146, 185.
8
The intentional destruction of property is popularly referred to as vandalism. It includes behavior such
as breaking windows, slashing tires, spray painting a wall with graffiti, and destroying a computer system
through the use of a computer virus, http://legal-dictionary.thefreedictionary.com/Vandalism (last
accessed August 12, 2013).
9
Southern Hemisphere Engagement Network, Inc. v. Anti-Terrorism Council, supra note 7, at 186;
Estrada v. Sandiganbayan, 421 Phil. 290, 354 (2001).
10
Id.
11
Id., citing the Opinion of Justice Vicente V. Mendoza in Estrada v. Sandiganbayan.
12
1987 CONSTITUTION, Article III, Section 1.
13
Pollo v. Constantino-David, G.R. No. 181881, October 18, 2011, 659 SCRA 189, 204-205.
14
130 Phil. 415 (1968)
15
535 Phil. 687, 714-715 (2006).
16
Supra note 12, Article II, Section 2.
17
Supra note 12, Article III, Section 3.
18
In the Matter of the Petition for Issuance of Writ of Habeas Corpus of Sabio v. Senator Gordon, supra
note 15.
19
Section 3(g) of Republic Act 10173 or the Data Privacy Act of 2012 defines personal information as
"any information whether recorded in a material form or not, from which the identity of an individual is
apparent or can be reasonably and directly ascertained by the entity holding the information, or when put
together with other information would directly and certainly identify an individual."
20
People v. Uy, G.R. No. 174660, May 30, 2011, 649 SCRA 236.
21
Supra note 17 (G.R. No. 203359 [Guingona]; G.R. No. 203518 [PIFA]).
22
Merriam-Webster, http://www.merriam-webster.com/dictionary/favor (last accessed May 30, 2013).
23
Bicameral Conference Committee, pp. 5-6.
24
Id.
25
Office of the Solicitor General, COMMENT, p. 71.
26
REPUBLIC ACT 9208, Section 4(e).
27
Id., Section 3(c).
28
G.R. No. 191080, November 21, 2011, 660 SCRA 475.
29
REVISED PENAL CODE, Article 201 (2)(b)(2), as amended by Presidential Decree 969.
30
Pita v. Court of Appeals, 258-A Phil. 134 (1989).
31
REPUBLIC ACT 9775 entitled AN ACT DEFINING THE CRIME OF CHILD PORNOGRAPHY,
PRESCRIBING PENALTIES THEREFOR AND FOR OTHER PURPOSES.
32
Sto. Tomas v. Salac, G.R. No. 152642, November 13, 2012, 685 SCRA 245, citing People v. Ventura,
114 Phil. 162, 167 (1962).
33
Supra note 31, Section 4(b).
34
G.R. No. 203407 (Bagong Alyansang Makabayan), MEMORANDUM, pp. 34-37.
35
White Buffalo Ventures, LLC v. Univ. of Tex. at Austin, 2004 U.S. Dist. LEXIS 19152 (W.D. Tex.
Mar. 22, 2004).
36
Concurring Opinion of Chief Justice Reynato S. Puno in Pharmaceutical and Health Care Association
of the Philippines v. Duque III, 561 Phil. 387, 449 (2007).
37
Supra note 29, Article 362.
38
Borjal v. Court of Appeals, 361 Phil. 1 (1999); Vasquez v. Court of Appeals, 373 Phil. 238 (1999).
39
573 Phil. 278 (2008).
40
Vasquez v. Court of Appeals, supra note 38.
41
L. BOADO, COMPACT REVIEWER IN CRIMINAL LAW 403-404 (2d ed. 2007).
42
Vasquez v. Court of Appeals, supra note 38, citing New York Times v. Sullivan, 376 U.S. 254, 11
L.Ed.2d 686 (1964).
43
Annette F. v. Sharon S., 119 Cal. App. 4th 1146, 1151 (Cal. App. 4th Dist. 2004).
44
Borjal v. Court of Appeals, supra note 38, citing United States v. Bustos, 37 Phil. 731 (1918).
45
46
Supra note 29, Article 354.
47
Communication 1815/2008.
48
General Comment 34, ICCPR, par. 47.
49
ICCPR, Article 19(2) and (3).
50
Sandals Resorts Intl. Ltd. v. Google, Inc., 86 A.D.3d 32 (N.Y. App. Div. 1st Dept 2011).
51
Office of the Solicitor General, MEMORANDUM, pp. 69-70.
52
REPUBLIC ACT 3701, Section 1.
53
REPUBLIC ACT 4712, Section 5.
54
LABOR CODE, Article 264.
55
G.R. No. 203440 (Sta. Maria), PETITION, p. 2.
56
http://www.statisticbrain.com/social-networking-statistics/ (last accessed January 14, 2013).
57
http://en.wikipedia.org/wiki/Social_networking_service (last accessed January 14, 2013).
58
http://www.statisticbrain.com/social-networking-statistics/ (last accessed January 14, 2013).
59
http://en.wikipedia.org/wiki/Facebook (last accessed January 14, 2013).
60
G. R . No. 203378 (Adonis) and G.R. No. 203391 (Palatino), CONSOLIDATED MEMORANDUM, p.
34.
61
521 U.S. 844 (1997).
62
Griswold v. Connecticut, 381 U.S. 479 (1965).
63
G.R. No. 203378 (Adonis), First AMENDED PETITION, pp. 35-36.
64
65
576 Phil. 357 (2008).
66
Id.
67
Id.
68
A contention found in Bruce Byars, Timothy OKeefe, and Thomas Clement "Google, Inc.: Procurer,
Possessor, Distributor, Aider and Abettor in Child Pornography,"
http://forumonpublicpolicy.com/archivespring08/byars.pdf (last accessed May 25, 2013).
69
Id., citing 47 U.S.C. 230.
70
Bianca Bosker, Facebook To Share Users' Home Addresses, Phone Numbers With External Sites,
http://www.huffingtonpost.com/2011/02/28/facebook-home-addresses-phone-numbers_n_829459.html
(last accessed July 18, 2013).
71
G.R. No. 203440 (Sta Maria), MEMORANDUM, p. 14, citing Luis B. Reyes, The Revised Penal Code:
Book 1, 118 (17th ed. 2008).
72
Shiresee Bell, Man Pleads Guilty to Attempted USC Website Hacking, Email Accounts,
http://columbia-sc.patch.com/groups/police-and-fire/p/man-pleaded-guilty-to-hacking-usc-website-email-
accounts (last accessed July 18, 2013); Peter Ryan, Hackers target Bureau of Statistics data,
http://www.abc.net.au/news/2013-04-26/abs-targeted-by-hackers/4652758 (last accessed July 18, 2013).
73
74
Supra note 51, at 49, citing People v. Doriquez, 133 Phil. 295 (1968).
75
Office of the Solicitor General, MEMORANDUM, p. 49.
76
Section 21, Article III, 1987 CONSTITUTION: "No person shall be twice put in jeopardy of
punishment for the same offense. If an act is punished by a law and an ordinance, conviction or acquittal
under either shall constitute a bar to another prosecution for the same act."
77
Baylosis v. Hon. Chavez, Jr., 279 Phil. 448 (1991).
78
People v. Dela Cruz, G.R. No. 100386, December 11, 1992, 216 SCRA 476, citing People v. Millora,
252 Phil. 105 (1989).
79
80
Ople v. Torres, 354 Phil. 948, 974-975 (1998).
81
In the Matter of the Petition for Habeas Corpus of Capt. Alejano v. Gen. Cabuay, 505 Phil. 298, 322
(2005); Gamboa v. Chan, G.R. No. 193636, July 24, 2012, 677 SCRA 385.
82
SEC. 2. Declaration of Policy. The State recognizes the vital role of information and
communications industries such as content production, telecommunications, broadcasting electronic
commerce, and data processing, in the nations overall social and economic development. The State also
recognizes the importance of providing an environment conducive to the development, acceleration, and
rational application and exploitation of information and communications technology (ICT) to attain free,
easy, and intelligible access to exchange and/or delivery of information; and the need to protect and
safeguard the integrity of computer, computer and communications systems, networks, and databases, and
the confidentiality, integrity, and availability of information and data stored therein, from all forms of
misuse, abuse, and illegal access by making punishable under the law such conduct or conducts. In this
light, the State shall adopt sufficient powers to effectively prevent and combat such offenses by
facilitating their detection, investigation, and prosecution at both the domestic and international levels,
and by providing arrangements for fast and reliable international cooperation.
83
Convention on Cybercrime, Art. 20, opened for signature November 23, 2001, ETS 185.
84
Cybercrime Law, Section 4(a)(1),.
85
Id., Section 4(a)(3)
86
Id., Section 4(c)(1)
87
Id., Section 4(c)(2)
88
Supra note 14.
89
Id. at 433-437.
90
429 U.S. 589 (1977).
91
Id. at 599.
92
93
Jonathan Strickland, How IP Convergence Works, http://computer.howstuffworks.com/ip-
convergence2.htm (last accessed May 10, 2013).
94
442 U.S. 735 (1979).
95
96
Supra note 14, at 437, citing Emerson, Nine Justices in Search of a Doctrine, 64 Mich. Law Rev. 219,
229 (1965).
97
G.R. No. 203391 (Palatino v. Ochoa).
98
Biraogo v. Philippine Truth Commission, G.R. Nos. 192935 and 193036, December 7, 2010, 637
SCRA 78, 143; ADMINISTRATIVE CODE of 1987, Book I, Chapter 9, Section 37, and Book VII,
Chapter 1, Section 13.
99
Computer data is defined by R.A. 10175 as follows:
"SEC. 3. Definition of Terms. x x x
xxxx
(e) Computer data refers to any representation of facts, information, or concepts in a form suitable for
processing in a computer system including a program suitable to cause a computer system to perform a
function and includes electronic documents and/or electronic data messages whether stored in local
computer systems or online."
100
Pita v. Court of Appeals, supra note 30, at 151.
101
Chavez v. Gonzales, 569 Phil. 155 (2008).
102
Entitled PENALIZING OBSTRUCTION OF APPREHENSION AND PROSECUTION OF
CRIMINAL OFFENDERS.
103
Gerochi v. Department of Energy, 554 Phil. 563 (2007).
104
REPUBLIC ACT 10175, Section 3(k).
105
Supra note 94.
106
Gerochi v. Department of Energy, supra note 103, at 586, citing Rubi v. Provincial Board of Mindoro,
39 Phil. 660 (1919).
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 191424 August 7, 2013
ALFEO D. VIVAS, ON HIS BEHALF AND ON BEHALF OF THE SHAREHOLDERS OF
EUROCREDIT COMMUNITY BANK, PETITIONER,
vs.
THE MONETARY BOARD OF THE BANGKO SENTRAL NG PILIPINAS AND THE
PHILIPPINE DEPOSIT INSURANCE CORPORATION, RESPONDENTS.
DECISION
MENDOZA, J.:
This is a petition for prohibition with prayer for the issuance of a status quo ante order or writ of
preliminary injunction ordering the respondents to desist from closing EuroCredit Community Bank,
Incorporated (ECBI) and from pursuing the receivership thereof. The petition likewise prays that the
management and operation of ECBI be restored to its Board of Directors (BOD) and its officers.
The Facts
The Rural Bank of Faire, Incorporated (RBFI) was a duly registered rural banking institution with
principal office in Centro Sur, Sto. Nio, Cagayan. Record shows that the corporate life of RBFI expired
on May 31, 2005.1Notwithstanding, petitioner Alfeo D. Vivas (Vivas) and his principals acquired the
controlling interest in RBFI sometime in January 2006. At the initiative of Vivas and the new
management team, an internal audit was conducted on RBFI and results thereof highlighted the dismal
operation of the rural bank. In view of those findings, certain measures calculated to revitalize the bank
were allegedly introduced.2 On December 8, 2006, the Bangko Sentral ng Pilipinas (BSP) issued the
Certificate of Authority extending the corporate life of RBFI for another fifty (50) years. The BSP also
approved the change of its corporate name to EuroCredit Community Bank, Incorporated, as well as the
increase in the number of the members of its BOD, from five (5) to eleven (11).3
Pursuant to Section 28 of Republic Act (R.A.) No. 7653, otherwise known as The New Central Bank Act,
the Integrated Supervision Department II (ISD II) of the BSP conducted a general examination on ECBI
with the cut-off date of December 31, 2007. Shortly after the completion of the general examination, an
exit conference was held on March 27, 2008 at the BSP during which the BSP officials and examiners
apprised Vivas, the Chairman and President of ECBI, as well as the other bank officers and members of
its BOD, of the advance findings noted during the said examination. The ECBI submitted its comments
on BSPs consolidated findings and risk asset classification through a letter, dated April 8, 2008.4
Sometime in April 2008, the examiners from the Department of Loans and Credit of the BSP arrived at
the ECBI and cancelled the rediscounting line of the bank. Vivas appealed the cancellation to
BSP.5 Thereafter, the Monetary Board (MB) issued Resolution No. 1255, dated September 25, 2008,
placing ECBI under Prompt Corrective Action (PCA) framework because of the following serious
findings and supervisory concerns noted during the general examination: 1] negative capital of ?14.674
million and capital adequacy ratio of negative 18.42%; 2] CAMEL (Capital Asset Management Earnings
Liquidity) composite rating of "2" with a Management component rating of "1"; and 3] serious
supervisory concerns particularly on activities deemed unsafe or unsound.6 Vivas claimed that the BSP
took the above courses of action due to the joint influence exerted by a certain hostile shareholder and a
former BSP examiner.7
Through its letter, dated September 30, 2008, the BSP furnished ECBI with a copy of the Report of
Examination (ROE) as of December 31, 2007. In addition, the BSP directed the banks BOD and senior
management to: 1] infuse fresh capital of ?22.643 million; 2] book the amount of ?28.563 million
representing unbooked valuation reserves on classified loans and other risks assets on or before October
31, 2008; and 3] take appropriate action necessary to address the violations/exceptions noted in the
examination.8
Vivas moved for a reconsideration of Resolution No. 1255 on the grounds of non-observance of due
process and arbitrariness. The ISD II, on several instances, had invited the BOD of ECBI to discuss
matters pertaining to the placement of the bank under PCA framework and other supervisory concerns
before making the appropriate recommendations to the MB. The proposed meeting, however, did not
materialize due to postponements sought by Vivas.9
In its letter, dated February 20, 2009, the BSP directed ECBI to explain why it transferred the majority
shares of RBFI without securing the prior approval of the MB in apparent violation of Subsection X126.2
of the Manual of Regulation for Banks (MORB).10 Still in another letter,11 dated March 31, 2009, the ISD
II required ECBI to explain why it did not obtain the prior approval of the BSP anent the establishment
and operation of the banks sub-offices.
Also, the scheduled March 31, 2009 general examination of the books, records and general condition of
ECBI with the cut-off date of December 31, 2008, did not push through. According to Vivas, ECBI asked
for the deferment of the examination pending resolution of its appeal before the MB. Vivas believed that
he was being treated unfairly because the letter of authority to examine allegedly contained a clause
which pertained to the Anti-Money Laundering Law and the Bank Secrecy Act.12
The MB, on the other hand, posited that ECBI unjustly refused to allow the BSP examiners from
examining and inspecting its books and records, in violation of Sections 25 and 34 of R.A. No. 7653. In
its letter,13 dated May 8, 2009, the BSP informed ECBI that it was already due for another annual
examination and that the pendency of its appeal before the MB would not prevent the BSP from
conducting another one as mandated by Section 28 of R.A. No. 7653.
In view of ECBIs refusal to comply with the required examination, the MB issued Resolution No.
726,14 dated May 14, 2009, imposing monetary penalty/fine on ECBI, and referred the matter to the
Office of the Special Investigation (OSI) for the filing of appropriate legal action. The BSP also wrote a
letter,15 dated May 26, 2009, advising ECBI to comply with MB Resolution No. 771, which essentially
required the bank to follow its directives. On May 28, 2009, the ISD II reiterated its demand upon the
ECBI BOD to allow the BSP examiners to conduct a general examination on June 3, 2009.16
In its June 2, 2009 Letter-Reply,17 ECBI asked for another deferment of the examination due to the
pendency of certain unresolved issues subject of its appeal before the MB, and because Vivas was then
out of the country. The ISD II denied ECBIs request and ordered the general examination to proceed as
previously scheduled.18
Thereafter, the MB issued Resolution No. 823,19 dated June 4, 2009, approving the issuance of a cease
and desist order against ECBI, which enjoined it from pursuing certain acts and transactions that were
considered unsafe or unsound banking practices, and from doing such other acts or transactions
constituting fraud or might result in the dissipation of its assets.
On June 10, 2009, the OSI filed with the Department of Justice (DOJ) a complaint for Estafa Through
Falsification of Commercial Documents against certain officials and employees of ECBI. Meanwhile, the
MB issued Resolution No. 1164,20 dated August 13, 2009, denying the appeal of ECBI from Resolution
No. 1255 which placed it under PCA framework. On November 18, 2009, the general examination of the
books and records of ECBI with the cut-off date of September 30, 2009, was commenced and ended in
December 2009. Later, the BSP officials and examiners met with the representatives of ECBI, including
Vivas, and discussed their findings.21 On December 7, 2009, the ISD II reminded ECBI of the non-
submission of its financial audit reports for the years 2007 and 2008 with a warning that failure to submit
those reports and the written explanation for such omission shall result in the imposition of a monetary
penalty.22 In a letter, dated February 1, 2010, the ISD II informed ECBI of MB Resolution No. 1548
which denied its request for reconsideration of Resolution No. 726.
On March 4, 2010, the MB issued Resolution No. 27623 placing ECBI under receivership in accordance
with the recommendation of the ISD II which reads:
On the basis of the examination findings as of 30 September 2009 as reported by the Integrated
Supervision Department (ISD) II, in its memorandum dated 17 February 2010, which findings showed
that the Eurocredit Community Bank, Inc. a Rural Bank (Eurocredit Bank) (a) is unable to pay its
liabilities as they become due in the ordinary course of business; (b) has insufficient realizable assets to
meet liabilities; (c) cannot continue in business without involving probable losses to its depositors and
creditors; and (d) has willfully violated a cease and desist order of the Monetary Board for acts or
transactions which are considered unsafe and unsound banking practices and other acts or transactions
constituting fraud or dissipation of the assets of the institution, and considering the failure of the Board of
Directors/management of Eurocredit Bank to restore the banks financial health and viability despite
considerable time given to address the banks financial problems, and that the bank had been accorded
due process, the Board, in accordance with Section 30 of Republic Act No. 7653 (The New Central Bank
Act), approved the recommendation of ISD II as follows:
To prohibit the Eurocredit Bank from doing business in the Philippines and to place its assets and affairs
under receivership; and
To designate the Philippine Deposit Insurance Corporation as Receiver of the bank.
Assailing MB Resolution No. 276, Vivas filed this petition for prohibition before this Court, ascribing
grave abuse of discretion to the MB for prohibiting ECBI from continuing its banking business and for
placing it under receivership. The petitioner presents the following
ARGUMENTS:
(a)
It is grave abuse of discretion amounting to loss of jurisdiction to apply the general law embodied in
Section 30 of the New Central Bank Act as opposed to the specific law embodied in Sections 11 and 14
of the Rural Banks Act of 1992.
(b)
Even if it assumed that Section 30 of the New Central Bank Act is applicable, it is still the gravest abuse
of discretion amounting to lack or excess of jurisdiction to execute the law with manifest arbitrariness,
abuse of discretion, and bad faith, violation of constitutional rights and to further execute a mandate well
in excess of its parameters.
(c)
The power delegated in favor of the Bangko Sentral ng Pilipinas to place rural banks under receiverships
is unconstitutional for being a diminution or invasion of the powers of the Supreme Court, in violation of
Section 2, Article VIII of the Philippine Constitution.24
Vivas submits that the respondents committed grave abuse of discretion when they erroneously applied
Section 30 of R.A. No. 7653, instead of Sections 11 and 14 of the Rural Bank Act of 1992 or R.A. No.
7353. He argues that despite the deficiencies, inadequacies and oversights in the conduct of the affairs of
ECBI, it has not committed any financial fraud and, hence, its placement under receivership was
unwarranted and improper. He posits that, instead, the BSP should have taken over the management of
ECBI and extended loans to the financially distrained bank pursuant to Sections 11 and 14 of R.A. No.
7353 because the BSPs power is limited only to supervision and management take-over of banks.
He contends that the implementation of the questioned resolution was tainted with arbitrariness and bad
faith, stressing that ECBI was placed under receivership without due and prior hearing in violation of his
and the banks right to due process. He adds that respondent PDIC actually closed ECBI even in the
absence of any directive to this effect. Lastly, Vivas assails the constitutionality of Section 30 of R.A. No.
7653 claiming that said provision vested upon the BSP the unbridled power to close and place under
receivership a hapless rural bank instead of aiding its financial needs. He is of the view that such power
goes way beyond its constitutional limitation and has transformed the BSP to a sovereign in its own
"kingdom of banks."25
The Courts Ruling
The petition must fail.
Vivas Availed of the Wrong Remedy
To begin with, Vivas availed of the wrong remedy. The MB issued Resolution No. 276, dated March 4,
2010, in the exercise of its power under R.A. No. 7653. Under Section 30 thereof, any act of the MB
placing a bank under conservatorship, receivership or liquidation may not be restrained or set aside except
on a petition for certiorari. Pertinent portions of R.A. 7653 read:
Section 30.
x x x x.
The actions of the Monetary Board taken under this section or under Section 29 of this Act shall be final
and executory, and may not be restrained or set aside by the court except on petition for certiorari on the
ground that the action taken was in excess of jurisdiction or with such grave abuse of discretion as to
amount to lack or excess of jurisdiction. The petition for certiorari may only be filed by the stockholders
of record representing the majority of the capital stock within ten (10) days from receipt by the board of
directors of the institution of the order directing receivership, liquidation or conservatorship.
x x x x. [Emphases supplied]
Prohibition is already unavailing
Granting that a petition for prohibition is allowed, it is already an ineffective remedy under the
circumstances obtaining. Prohibition or a "writ of prohibition" is that process by which a superior court
prevents inferior courts, tribunals, officers, or persons from usurping or exercising a jurisdiction with
which they have not been vested by law, and confines them to the exercise of those powers legally
conferred. Its office is to restrain subordinate courts, tribunals or persons from exercising jurisdiction over
matters not within its cognizance or exceeding its jurisdiction in matters of which it has cognizance. 26 In
our jurisdiction, the rule on prohibition is enshrined in Section 2, Rule 65 of the Rules on Civil Procedure,
to wit:
Sec. 2. Petition for prohibition - When the proceedings of any tribunal, corporation, board, officer or
person, whether exercising judicial, quasi-judicial or ministerial functions, are without or in excess of its
or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there
is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law, a person
aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and
praying that the judgment be rendered commanding the respondent to desist from further proceedings in
the action or matter specified therein, or otherwise granting such incidental reliefs as the law and justice
require.
x x x x.
Indeed, prohibition is a preventive remedy seeking that a judgment be rendered which would direct the
defendant to desist from continuing with the commission of an act perceived to be illegal.27 As a rule, the
proper function of a writ of prohibition is to prevent the doing of an act which is about to be done. It is
not intended to provide a remedy for acts already accomplished.28
Though couched in imprecise terms, this petition for prohibition apparently seeks to prevent the acts of
closing of ECBI and placing it under receivership. Resolution No. 276, however, had already been issued
by the MB and the closure of ECBI and its placement under receivership by the PDIC were already
accomplished. Apparently, the remedy of prohibition is no longer appropriate. Settled is the rule that
prohibition does not lie to restrain an act that is already a fait accompli.29
The Petition Should Have Been Filed in the CA
Even if treated as a petition for certiorari, the petition should have been filed with the CA. Section 4 of
Rule 65 reads:
Section 4. When and where petition filed. The petition shall be filed not later than sixty (60) days from
notice of the judgment, order or resolution. In case a motion for reconsideration or new trial is timely
filed, whether such motion is required or not, the sixty (60) day period shall be counted from notice of the
denial of said motion.
The petition shall be filed in the Supreme Court or, if it relates to the acts or omissions of a lower court or
of a corporation, board, officer or person, in the Regional Trial Court exercising jurisdiction over the
territorial area as defined by the Supreme Court. It may also be filed in the Court of Appeals whether or
not the same is in aid of its appellate jurisdiction, or in the Sandiganbayan if it is in aid of its appellate
jurisdiction. If it involves the acts or omissions of a quasi-judicial agency, unless otherwise provided by
law or these Rules, the petition shall be filed in and cognizable only by the Court of Appeals. [Emphases
supplied]
That the MB is a quasi-judicial agency was already settled and reiterated in the case of Bank of
Commerce v. Planters Development Bank And Bangko Sentral Ng Pilipinas.30
Doctrine of Hierarchy of Courts
Even in the absence of such provision, the petition is also dismissible because it simply ignored the
doctrine of hierarchy of courts. True, the Court, the CA and the RTC have original concurrent jurisdiction
to issue writs of certiorari, prohibition and mandamus. The concurrence of jurisdiction, however, does not
grant the party seeking any of the extraordinary writs the absolute freedom to file a petition in any court
of his choice. The petitioner has not advanced any special or important reason which would allow a direct
resort to this Court. Under the Rules of Court, a party may directly appeal to this Court only on pure
questions of law.31 In the case at bench, there are certainly factual issues as Vivas is questioning the
findings of the investigating team.
Strict observance of the policy of judicial hierarchy demands that where the issuance of the extraordinary
writs is also within the competence of the CA or the RTC, the special action for the obtainment of such
writ must be presented to either court. As a rule, the Court will not entertain direct resort to it unless the
redress desired cannot be obtained in the appropriate lower courts; or where exceptional and compelling
circumstances, such as cases of national interest and with serious implications, justify the availment of the
extraordinary remedy of writ of certiorari, prohibition, or mandamus calling for the exercise of its primary
jurisdiction.32 The judicial policy must be observed to prevent an imposition on the precious time and
attention of the Court.
The MB Committed No Grave Abuse of Discretion
In any event, no grave abuse of discretion can be attributed to the MB for the issuance of the assailed
Resolution No. 276.
Vivas insists that the circumstances of the case warrant the application of Section 11 of R.A. No. 7353,
which provides:
Sec. 11. The power to supervise the operation of any rural bank by the Monetary Board as herein
indicated shall consist in placing limits to the maximum credit allowed to any individual borrower; in
prescribing the interest rate, in determining the loan period and loan procedures, in indicating the manner
in which technical assistance shall be extended to rural banks, in imposing a uniform accounting system
and manner of keeping the accounts and records of rural banks; in instituting periodic surveys of loan and
lending procedures, audits, test-check of cash and other transactions of the rural banks; in conducting
training courses for personnel of rural banks; and, in general, in supervising the business operations of the
rural banks.
The Central Bank shall have the power to enforce the laws, orders, instructions, rules and regulations
promulgated by the Monetary Board, applicable to rural banks; to require rural banks, their directors,
officers and agents to conduct and manage the affairs of the rural banks in a lawful and orderly manner;
and, upon proof that the rural bank or its Board of Directors, or officers are conducting and managing the
affairs of the bank in a manner contrary to laws, orders, instructions, rules and regulations promulgated by
the Monetary Board or in a manner substantially prejudicial to the interest of the Government, depositors
or creditors, to take over the management of such bank when specifically authorized to do so by the
Monetary Board after due hearing process until a new board of directors and officers are elected and
qualified without prejudice to the prosecution of the persons responsible for such violations under the
provisions of Sections 32, 33 and 34 of Republic Act No. 265, as amended.
x x x x.
The thrust of Vivas argument is that ECBI did not commit any financial fraud and, hence, its placement
under receivership was unwarranted and improper. He asserts that, instead, the BSP should have taken
over the management of ECBI and extended loans to the financially distrained bank pursuant to Sections
11 and 14 of R.A. No. 7353 because the BSPs power is limited only to supervision and management
take-over of banks, and not receivership.
Vivas argues that implementation of the questioned resolution was tainted with arbitrariness and bad
faith, stressing that ECBI was placed under receivership without due and prior hearing, invoking Section
11 of R.A. No. 7353 which states that the BSP may take over the management of a rural bank after due
hearing.33 He adds that because R.A. No. 7353 is a special law, the same should prevail over R.A. No.
7653 which is a general law.
The Court has taken this into account, but it appears from all over the records that ECBI was given every
opportunity to be heard and improve on its financial standing. The records disclose that BSP officials and
examiners met with the representatives of ECBI, including Vivas, and discussed their findings.34 There
were also reminders that ECBI submit its financial audit reports for the years 2007 and 2008 with a
warning that failure to submit them and a written explanation of such omission shall result in the
imposition of a monetary penalty.35 More importantly, ECBI was heard on its motion for reconsideration.
For failure of ECBI to comply, the MB came out with Resolution No. 1548 denying its request for
reconsideration of Resolution No. 726. Having been heard on its motion for reconsideration, ECBI cannot
claim that it was deprived of its right under the Rural Bank Act.
Close Now, Hear Later
At any rate, if circumstances warrant it, the MB may forbid a bank from doing business and place it under
receivership without prior notice and hearing. Section 30 of R.A. No. 7653 provides, viz:
Sec. 30. Proceedings in Receivership and Liquidation. Whenever, upon report of the head of the
supervising or examining department, the Monetary Board finds that a bank or quasi-bank:
(a) is unable to pay its liabilities as they become due in the ordinary course of business: Provided, That
this shall not include inability to pay caused by extraordinary demands induced by financial panic in the
banking community;
(b) has insufficient realizable assets, as determined by the Bangko Sentral, to meet its liabilities; or
(c) cannot continue in business without involving probable losses to its depositors or creditors; or
(d) has wilfully violated a cease and desist order under Section 37 that has become final, involving acts or
transactions which amount to fraud or a dissipation of the assets of the institution; in which cases, the
Monetary Board may summarily and without need for prior hearing forbid the institution from doing
business in the Philippines and designate the Philippine Deposit Insurance Corporation as receiver of the
banking institution. [Emphases supplied.]
x x x x.
Accordingly, there is no conflict which would call for the application of the doctrine that a special law
should prevail over a general law. It must be emphasized that R.A .No. 7653 is a later law and under said
act, the power of the MB over banks, including rural banks, was increased and expanded. The Court, in
several cases, upheld the power of the MB to take over banks without need for prior hearing. It is not
necessary inasmuch as the law entrusts to the MB the appreciation and determination of whether any or
all of the statutory grounds for the closure and receivership of the erring bank are present. The MB, under
R.A. No. 7653, has been invested with more power of closure and placement of a bank under receivership
for insolvency or illiquidity, or because the banks continuance in business would probably result in the
loss to depositors or creditors. In the case of Bangko Sentral Ng Pilipinas Monetary Board v. Hon.
Antonio-Valenzuela,36 the Court reiterated the doctrine of "close now, hear later," stating that it was
justified as a measure for the protection of the public interest. Thus:
The "close now, hear later" doctrine has already been justified as a measure for the protection of the
public interest. Swift action is called for on the part of the BSP when it finds that a bank is in dire straits.
Unless adequate and determined efforts are taken by the government against distressed and mismanaged
banks, public faith in the banking system is certain to deteriorate to the prejudice of the national economy
itself, not to mention the losses suffered by the bank depositors, creditors, and stockholders, who all
deserve the protection of the government.37[Emphasis supplied]
In Rural Bank of Buhi, Inc. v. Court of Appeals,38 the Court also wrote that
x x x due process does not necessarily require a prior hearing; a hearing or an opportunity to be heard may
be subsequent to the closure. One can just imagine the dire consequences of a prior hearing: bank runs
would be the order of the day, resulting in panic and hysteria. In the process, fortunes may be wiped out
and disillusionment will run the gamut of the entire banking community.39
The doctrine is founded on practical and legal considerations to obviate unwarranted dissipation of the
banks assets and as a valid exercise of police power to protect the depositors, creditors, stockholders, and
the general public.40 Swift, adequate and determined actions must be taken against financially distressed
and mismanaged banks by government agencies lest the public faith in the banking system deteriorate to
the prejudice of the national economy.
Accordingly, the MB can immediately implement its resolution prohibiting a banking institution to do
business in the Philippines and, thereafter, appoint the PDIC as receiver. The procedure for the
involuntary closure of a bank is summary and expeditious in nature. Such action of the MB shall be final
and executory, but may be later subjected to a judicial scrutiny via a petition for certiorari to be filed by
the stockholders of record of the bank representing a majority of the capital stock. Obviously, this
procedure is designed to protect the interest of all concerned, that is, the depositors, creditors and
stockholders, the bank itself and the general public. The protection afforded public interest warrants the
exercise of a summary closure.
In the case at bench, the ISD II submitted its memorandum, dated February 17, 2010, containing the
findings noted during the general examination conducted on ECBI with the cut-off date of September 30,
2009. The memorandum underscored the inability of ECBI to pay its liabilities as they would fall due in
the usual course of its business, its liabilities being in excess of the assets held. Also, it was noted that
ECBIs continued banking operation would most probably result in the incurrence of additional losses to
the prejudice of its depositors and creditors. On top of these, it was found that ECBI had willfully violated
the cease-and-desist order of the MB issued in its June 24, 2009 Resolution, and had disregarded the BSP
rules and directives. For said reasons, the MB was forced to issue the assailed Resolution No. 276 placing
ECBI under receivership. In addition, the MB stressed that it accorded ECBI ample time and opportunity
to address its monetary problem and to restore and improve its financial health and viability but it failed
to do so.
In light of the circumstances obtaining in this case, the application of the corrective measures enunciated
in Section 30 of R.A. No. 7653 was proper and justified. Management take-over under Section 11 of R.A.
No. 7353 was no longer feasible considering the financial quagmire that engulfed ECBI showing serious
conditions of insolvency and illiquidity. Besides, placing ECBI under receivership would effectively put a
stop to the further draining of its assets.
No Undue Delegation of Legislative Power
Lastly, the petitioner challenges the constitutionality of Section 30 of R.A. No. 7653, as the legislature
granted the MB a broad and unrestrained power to close and place a financially troubled bank under
receivership. He claims that the said provision was an undue delegation of legislative power. The
contention deserves scant consideration.
Preliminarily, Vivas attempt to assail the constitutionality of Section 30 of R.A. No. 7653 constitutes
collateral attack on the said provision of law. Nothing is more settled than the rule that the
constitutionality of a statute cannot be collaterally attacked as constitutionality issues must be pleaded
directly and not collaterally.41 A collateral attack on a presumably valid law is not permissible. Unless a
law or rule is annulled in a direct proceeding, the legal presumption of its validity stands.42
Be that as it may, there is no violation of the non-delegation of legislative power.1wphi1 The rationale
for the constitutional proscription is that "legislative discretion as to the substantive contents of the law
cannot be delegated. What can be delegated is the discretion to determine how the law may be enforced,
not what the law shall be. The ascertainment of the latter subject is a prerogative of the legislature. This
prerogative cannot be abdicated or surrendered by the legislature to the delegate."43
"There are two accepted tests to determine whether or not there is a valid delegation of legislative power,
viz, the completeness test and the sufficient standard test. Under the first test, the law must be complete in
all its terms and conditions when it leaves the legislature such that when it reaches the delegate the only
thing he will have to do is enforce it. Under the sufficient standard test, there must be adequate guidelines
or stations in the law to map out the boundaries of the delegate's authority and prevent the delegation
from running riot. Both tests are intended to prevent a total transference of legislative authority to the
delegate, who is not allowed to step into the shoes of the legislature and exercise a power essentially
legislative."44
In this case, under the two tests, there was no undue delegation of legislative authority in the issuance of
R.A. No. 7653. To address the growing concerns in the banking industry, the legislature has sufficiently
empowered the MB to effectively monitor and supervise banks and financial institutions and, if
circumstances warrant, to forbid them to do business, to take over their management or to place them
under receivership. The legislature has clearly spelled out the reasonable parameters of the power
entrusted to the MB and assigned to it only the manner of enforcing said power. In other words, the MB
was given a wide discretion and latitude only as to how the law should be implemented in order to attain
its objective of protecting the interest of the public, the banking industry and the economy.
WHEREFORE, the petition for prohibition is DENIED.
SO ORDERED.
JOSE CATRAL MENDOZA
Associate Justice
WE CONCUR:
PRESBITERO J. VELASCO, JR.
Associate Justice
Chairperson
DIOSDADO M. PERALTA ROBERTO A. ABAD

MARVIC MARIO VICTOR F. LEONEN

Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court's Division.
PRESBITERO J. VELASCO, JR.
Associate Justice
Chairperson, Third Division
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I
certify that the conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court's Division.
MARIA LOURDES P. A. SERENO
Chief Justice
Footnotes
1
Rollo, p. 155.
2
Id. at 8-11.
3
Id. at 115.
4
Id. at 116.
5
Id. at 12.
6
Id. at 181.
7
Id. at 13.
8
Id. at 117-118.
9
Id. at 236-241.
10
Id. at 119-120.
11
Id. at 262.
12
Id. at 14.
13
Id. at 263.
14
Id. at 265.
15
Id. at 267-268.
16
Id. at 271.
17
Id. at 272.
18
Id. at 273.
19
Id. at 275-277.
20
Id. at 282.
21
Id. at 125.
22
Id. at 283.
23
Id. at 50.
24
Id. at 17-18.
25
Id. at 37.
26
City Engineer of Baguio v. Baniqued, G.R. No. 150270, November 26, 2008, 57 SCRA 617, 625.
27
Guerrero v. Domingo, G.R. No. 156142, March 23, 2011, 646 SCRA 175, 180.
28
Cabanero v. Torres, 61 Phil, 522 (1935); Agustin v. De la Fuente, 84 Phil 525 (1949); Navarro v.
Lardizabal, 134 Phil. 331 (1968); Heirs of Eugenia V. Roxas, Inc. v. Intermediate Appellate Court, 255
Phil 558 (1989).
29
Montes v. Court of Appeals, 523 Phil 98, 110 (2006).
30
G.R. Nos. 154470-71, September 24, 2012 , 681 SCRA 521, 555 (citing United Coconut Planters Bank
v. E. Ganzon, Inc., G.R. No. 168859, June 30, 2009, 591 SCRA 321, 338-341).
31
Philippine Veterans Bank v. Benjamin Monillas, 573 Phil 298, 315 (2008).
32
Springfield Development Corp., Inc. v. Hon. Presiding Judge of RTC, Branch 40., Cagayan de Oro
City, Misamis Oriental, 543 Phil. 298, 315 (2007).
33
Section 11. The power to supervise the operation of any rural bank by the Monetary Board as herein
indicated shall consists in placing limits to the maximum credit allowed to any individual borrower; in
prescribing the interest rate; in determining the loan period and loan procedures; in indicating the manner
in which technical assistance shall be extended to rural banks; in imposing a uniform accounting system
and manner of keeping the accounts and records of rural banks; in instituting periodic surveys of loan and
lending procedures, audits, test-check of cash and other transactions of the rural banks; and, in general in
supervising the business operations of the rural banks.
The Central bank shall have the power to enforce the laws, orders, instructions, rules and regulations
promulgated by the Monetary Board applicable to rural banks; to require rural banks, their directors,
officers and agents to conduct and manage the affairs of the rural banks in a lawful and orderly manner,
and, upon proof that the rural bank of its Board of Directors, or officers are conducting and managing the
affairs of the banking in a manner contrary to the laws, orders, instructions, rules and regulations
promulgated by the Monetary Board or in a manner substantially prejudicial in the interest of the
Government, depositors or creditors, to take over the management of such bank when specifically
authorized to do so by the Monetary Board after due hearing process until a new board of directors and
officers are elected and qualified without prejudice to the prosecution of the persons for such violations
under the provisions of Sections 32, 33 and 34 of Republic Act No. 265, as amended.
34
Rollo, p. 125.
35
Id. at 283.
36
G.R. No. 184778, October 2, 2009, 602 SCRA 698.
37
Id. at 721.
38
245 Phil. 263 (1988).
39
Id. at 278.
40
Bangko Sentral ng Pilipinas Monetary Board v. Antonio-Valenzuela, G.R. No. 184778, October 2,
2009, 602 SCRA 698.
41
Gutierrez v. Department of Budget and Management, G.R. No. 153266, March 18, 2010, 616 SCRA 1,
25.
42
Dasmarias Water District v. Leonardo-De Castro, G.R. No. 175550, September 17, 2008, 565 SCRA
624, 637.
43
Eastern Shipping Lines, Inc. v. Philippine Overseas Employment Administration, 248 Phil 762, 771
(1998).
44
Id.
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 76633 October 18, 1988
EASTERN SHIPPING LINES, INC., petitioner,
vs.
PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION (POEA), MINISTER OF
LABOR AND EMPLOYMENT, HEARING OFFICER ABDUL BASAR and KATHLEEN D.
SACO, respondents.
Jimenea, Dala & Zaragoza Law Office for petitioner.
The Solicitor General for public respondent.
Dizon Law Office for respondent Kathleen D. Saco.
CRUZ, J.:
The private respondent in this case was awarded the sum of P192,000.00 by the Philippine Overseas
Employment Administration (POEA) for the death of her husband. The decision is challenged by the
petitioner on the principal ground that the POEA had no jurisdiction over the case as the husband was not
an overseas worker.
Vitaliano Saco was Chief Officer of the M/V Eastern Polaris when he was killed in an accident in Tokyo,
Japan, March 15, 1985. His widow sued for damages under Executive Order No. 797 and Memorandum
Circular No. 2 of the POEA. The petitioner, as owner of the vessel, argued that the complaint was
cognizable not by the POEA but by the Social Security System and should have been filed against the
State Insurance Fund. The POEA nevertheless assumed jurisdiction and after considering the position
papers of the parties ruled in favor of the complainant. The award consisted of P180,000.00 as death
benefits and P12,000.00 for burial expenses.
The petitioner immediately came to this Court, prompting the Solicitor General to move for dismissal on
the ground of non-exhaustion of administrative remedies.
Ordinarily, the decisions of the POEA should first be appealed to the National Labor Relations
Commission, on the theory inter alia that the agency should be given an opportunity to correct the errors,
if any, of its subordinates. This case comes under one of the exceptions, however, as the questions the
petitioner is raising are essentially questions of law. 1 Moreover, the private respondent himself has not
objected to the petitioner's direct resort to this Court, observing that the usual procedure would delay the
disposition of the case to her prejudice.
The Philippine Overseas Employment Administration was created under Executive Order No. 797,
promulgated on May 1, 1982, to promote and monitor the overseas employment of Filipinos and to
protect their rights. It replaced the National Seamen Board created earlier under Article 20 of the Labor
Code in 1974. Under Section 4(a) of the said executive order, the POEA is vested with "original and
exclusive jurisdiction over all cases, including money claims, involving employee-employer relations
arising out of or by virtue of any law or contract involving Filipino contract workers, including seamen."
These cases, according to the 1985 Rules and Regulations on Overseas Employment issued by the POEA,
include "claims for death, disability and other benefits" arising out of such employment. 2
The petitioner does not contend that Saco was not its employee or that the claim of his widow is not
compensable. What it does urge is that he was not an overseas worker but a 'domestic employee and
consequently his widow's claim should have been filed with Social Security System, subject to appeal to
the Employees Compensation Commission.
We see no reason to disturb the factual finding of the POEA that Vitaliano Saco was an overseas
employee of the petitioner at the time he met with the fatal accident in Japan in 1985.
Under the 1985 Rules and Regulations on Overseas Employment, overseas employment is defined as
"employment of a worker outside the Philippines, including employment on board vessels plying
international waters, covered by a valid contract. 3 A contract worker is described as "any person working
or who has worked overseas under a valid employment contract and shall include seamen" 4 or "any
person working overseas or who has been employed by another which may be a local employer, foreign
employer, principal or partner under a valid employment contract and shall include seamen." 5 These
definitions clearly apply to Vitaliano Saco for it is not disputed that he died while under a contract of
employment with the petitioner and alongside the petitioner's vessel, the M/V Eastern Polaris, while
berthed in a foreign country. 6
It is worth observing that the petitioner performed at least two acts which constitute implied or tacit
recognition of the nature of Saco's employment at the time of his death in 1985. The first is its submission
of its shipping articles to the POEA for processing, formalization and approval in the exercise of its
regulatory power over overseas employment under Executive Order NO. 797. 7 The second is its
payment 8 of the contributions mandated by law and regulations to the Welfare Fund for Overseas
Workers, which was created by P.D. No. 1694 "for the purpose of providing social and welfare services to
Filipino overseas workers."
Significantly, the office administering this fund, in the receipt it prepared for the private respondent's
signature, described the subject of the burial benefits as "overseas contract worker Vitaliano
Saco." 9 While this receipt is certainly not controlling, it does indicate, in the light of the petitioner's own
previous acts, that the petitioner and the Fund to which it had made contributions considered Saco to be
an overseas employee.
The petitioner argues that the deceased employee should be likened to the employees of the Philippine Air
Lines who, although working abroad in its international flights, are not considered overseas workers. If
this be so, the petitioner should not have found it necessary to submit its shipping articles to the POEA for
processing, formalization and approval or to contribute to the Welfare Fund which is available only to
overseas workers. Moreover, the analogy is hardly appropriate as the employees of the PAL cannot under
the definitions given be considered seamen nor are their appointments coursed through the POEA.
The award of P180,000.00 for death benefits and P12,000.00 for burial expenses was made by the POEA
pursuant to its Memorandum Circular No. 2, which became effective on February 1, 1984. This circular
prescribed a standard contract to be adopted by both foreign and domestic shipping companies in the
hiring of Filipino seamen for overseas employment. A similar contract had earlier been required by the
National Seamen Board and had been sustained in a number of cases by this Court. 10 The petitioner
claims that it had never entered into such a contract with the deceased Saco, but that is hardly a serious
argument. In the first place, it should have done so as required by the circular, which specifically declared
that "all parties to the employment of any Filipino seamen on board any ocean-going vessel are advised to
adopt and use this employment contract effective 01 February 1984 and to desist from using any other
format of employment contract effective that date." In the second place, even if it had not done so, the
provisions of the said circular are nevertheless deemed written into the contract with Saco as a postulate
of the police power of the State. 11
But the petitioner questions the validity of Memorandum Circular No. 2 itself as violative of the principle
of non-delegation of legislative power. It contends that no authority had been given the POEA to
promulgate the said regulation; and even with such authorization, the regulation represents an exercise of
legislative discretion which, under the principle, is not subject to delegation.
The authority to issue the said regulation is clearly provided in Section 4(a) of Executive Order No. 797,
reading as follows:
... The governing Board of the Administration (POEA), as hereunder provided shall promulgate the
necessary rules and regulations to govern the exercise of the adjudicatory functions of the Administration
(POEA).
Similar authorization had been granted the National Seamen Board, which, as earlier observed, had itself
prescribed a standard shipping contract substantially the same as the format adopted by the POEA.
The second challenge is more serious as it is true that legislative discretion as to the substantive contents
of the law cannot be delegated. What can be delegated is the discretion to determine how the law may be
enforced, not whatthe law shall be. The ascertainment of the latter subject is a prerogative of the
legislature. This prerogative cannot be abdicated or surrendered by the legislature to the delegate. Thus, in
Ynot v. Intermediate Apellate Court 12 which annulled Executive Order No. 626, this Court held:
We also mark, on top of all this, the questionable manner of the disposition of the confiscated property as
prescribed in the questioned executive order. It is there authorized that the seized property shall be
distributed to charitable institutions and other similar institutions as the Chairman of the National Meat
Inspection Commission may see fit, in the case of carabaos.' (Italics supplied.) The phrase "may see fit" is
an extremely generous and dangerous condition, if condition it is. It is laden with perilous opportunities
for partiality and abuse, and even corruption. One searches in vain for the usual standard and the
reasonable guidelines, or better still, the limitations that the officers must observe when they make their
distribution. There is none. Their options are apparently boundless. Who shall be the fortunate
beneficiaries of their generosity and by what criteria shall they be chosen? Only the officers named can
supply the answer, they and they alone may choose the grantee as they see fit, and in their own exclusive
discretion. Definitely, there is here a 'roving commission a wide and sweeping authority that is not
canalized within banks that keep it from overflowing,' in short a clearly profligate and therefore invalid
delegation of legislative powers.
There are two accepted tests to determine whether or not there is a valid delegation of legislative
power, viz, the completeness test and the sufficient standard test. Under the first test, the law must be
complete in all its terms and conditions when it leaves the legislature such that when it reaches the
delegate the only thing he will have to do is enforce it. 13 Under the sufficient standard test, there must be
adequate guidelines or stations in the law to map out the boundaries of the delegate's authority and
prevent the delegation from running riot. 14
Both tests are intended to prevent a total transference of legislative authority to the delegate, who is not
allowed to step into the shoes of the legislature and exercise a power essentially legislative.
The principle of non-delegation of powers is applicable to all the three major powers of the Government
but is especially important in the case of the legislative power because of the many instances when its
delegation is permitted. The occasions are rare when executive or judicial powers have to be delegated by
the authorities to which they legally certain. In the case of the legislative power, however, such occasions
have become more and more frequent, if not necessary. This had led to the observation that the delegation
of legislative power has become the rule and its non-delegation the exception.
The reason is the increasing complexity of the task of government and the growing inability of the
legislature to cope directly with the myriad problems demanding its attention. The growth of society has
ramified its activities and created peculiar and sophisticated problems that the legislature cannot be
expected reasonably to comprehend. Specialization even in legislation has become necessary. To many of
the problems attendant upon present-day undertakings, the legislature may not have the competence to
provide the required direct and efficacious, not to say, specific solutions. These solutions may, however,
be expected from its delegates, who are supposed to be experts in the particular fields assigned to them.
The reasons given above for the delegation of legislative powers in general are particularly applicable to
administrative bodies. With the proliferation of specialized activities and their attendant peculiar
problems, the national legislature has found it more and more necessary to entrust to administrative
agencies the authority to issue rules to carry out the general provisions of the statute. This is called the
"power of subordinate legislation."
With this power, administrative bodies may implement the broad policies laid down in a statute by "filling
in' the details which the Congress may not have the opportunity or competence to provide. This is
effected by their promulgation of what are known as supplementary regulations, such as the implementing
rules issued by the Department of Labor on the new Labor Code. These regulations have the force and
effect of law.
Memorandum Circular No. 2 is one such administrative regulation. The model contract prescribed
thereby has been applied in a significant number of the cases without challenge by the employer. The
power of the POEA (and before it the National Seamen Board) in requiring the model contract is not
unlimited as there is a sufficient standard guiding the delegate in the exercise of the said authority. That
standard is discoverable in the executive order itself which, in creating the Philippine Overseas
Employment Administration, mandated it to protect the rights of overseas Filipino workers to "fair and
equitable employment practices."
Parenthetically, it is recalled that this Court has accepted as sufficient standards "Public interest"
in People v. Rosenthal 15 "justice and equity" in Antamok Gold Fields v. CIR 16 "public convenience and
welfare" in Calalang v. Williams 17 and "simplicity, economy and efficiency" in Cervantes v. Auditor
General, 18 to mention only a few cases. In the United States, the "sense and experience of men" was
accepted in Mutual Film Corp. v. Industrial Commission, 19 and "national security" in Hirabayashi v.
United States. 20
It is not denied that the private respondent has been receiving a monthly death benefit pension of P514.42
since March 1985 and that she was also paid a P1,000.00 funeral benefit by the Social Security System. In
addition, as already observed, she also received a P5,000.00 burial gratuity from the Welfare Fund for
Overseas Workers. These payments will not preclude allowance of the private respondent's claim against
the petitioner because it is specifically reserved in the standard contract of employment for Filipino
seamen under Memorandum Circular No. 2, Series of 1984, that
Section C. Compensation and Benefits.
1. In case of death of the seamen during the term of his Contract, the employer shall pay his beneficiaries
the amount of:
a. P220,000.00 for master and chief engineers
b. P180,000.00 for other officers, including radio operators and master electrician
c. P 130,000.00 for ratings.
2. It is understood and agreed that the benefits mentioned above shall be separate and distinct from, and
will be in addition to whatever benefits which the seaman is entitled to under Philippine laws. ...
3. ...
c. If the remains of the seaman is buried in the Philippines, the owners shall pay the beneficiaries of the
seaman an amount not exceeding P18,000.00 for burial expenses.
The underscored portion is merely a reiteration of Memorandum Circular No. 22, issued by the National
Seamen Board on July 12,1976, providing an follows:
Income Benefits under this Rule Shall be Considered Additional Benefits.
All compensation benefits under Title II, Book Four of the Labor Code of the Philippines (Employees
Compensation and State Insurance Fund) shall be granted, in addition to whatever benefits, gratuities or
allowances that the seaman or his beneficiaries may be entitled to under the employment contract
approved by the NSB. If applicable, all benefits under the Social Security Law and the Philippine
Medicare Law shall be enjoyed by the seaman or his beneficiaries in accordance with such laws.
The above provisions are manifestations of the concern of the State for the working class, consistently
with the social justice policy and the specific provisions in the Constitution for the protection of the
working class and the promotion of its interest.
One last challenge of the petitioner must be dealt with to close t case. Its argument that it has been denied
due process because the same POEA that issued Memorandum Circular No. 2 has also sustained and
applied it is an uninformed criticism of administrative law itself. Administrative agencies are vested with
two basic powers, the quasi-legislative and the quasi-judicial. The first enables them to promulgate
implementing rules and regulations, and the second enables them to interpret and apply such regulations.
Examples abound: the Bureau of Internal Revenue adjudicates on its own revenue regulations, the Central
Bank on its own circulars, the Securities and Exchange Commission on its own rules, as so too do the
Philippine Patent Office and the Videogram Regulatory Board and the Civil Aeronautics Administration
and the Department of Natural Resources and so on ad infinitum on their respective administrative
regulations. Such an arrangement has been accepted as a fact of life of modern governments and cannot
be considered violative of due process as long as the cardinal rights laid down by Justice Laurel in the
landmark case of Ang Tibay v. Court of Industrial Relations 21 are observed.
Whatever doubts may still remain regarding the rights of the parties in this case are resolved in favor of
the private respondent, in line with the express mandate of the Labor Code and the principle that those
with less in life should have more in law.
When the conflicting interests of labor and capital are weighed on the scales of social justice, the heavier
influence of the latter must be counter-balanced by the sympathy and compassion the law must accord the
underprivileged worker. This is only fair if he is to be given the opportunity and the right to assert and
defend his cause not as a subordinate but as a peer of management, with which he can negotiate on even
plane. Labor is not a mere employee of capital but its active and equal partner.
WHEREFORE, the petition is DISMISSED, with costs against the petitioner. The temporary restraining
order dated December 10, 1986 is hereby LIFTED. It is so ordered.
Narvasa, Gancayco, Grio-Aquino and Medialdea, JJ., concur.
Footnotes
1 Bagatsing v. Ramirez, 74 SCRA 306; Del Mar v. Phil. Veterans Administration, 51 SCRA 340; Aguilar
v. Valencia, 40 SCRA 210; Begosa v. PVA 32 SCRA 446; Tapales v. President and Board of Regents, 7
SCRA 553; Pascual v. Nueva Ecija Provincial Board, 106 Phil. 466; Mondano v. Silvosa 97 Phil. 143.
2 Sec. I (d), Rule I, Book VI (1985 Rules).
3 Sec. 1 x Rule 11, Book I (1985 Rules).
4 Sec. l(g), Rule II, Book I (1985 Rules).
5 Sec. 1 (g), Rule 11, Book I (1984 Rules).
6 Rollo, p. 171 (POEA Decision, p. 8).
7 Ibid., pp. 169-170 (POEA Decision, pp. 6-7).
8 Rollo, pp. 213-217.
9 Annex "A" of Private Respondent's Comment (Rollo, p. 230).
10 Bagong Filipinas Overseas Corp. v. NLRC, 135 SCRA 278; Virgen v. NLRC, 125 SCRA 577; orse
Management v. NSB, et al., 117 SCRA 486; Virgen v. NLRC, 115 SCRA 347.
11 Stone v. Mississippi, 101 US 814,
12 148 SCRA 669.
13 People v. Vera 65 Phil. 56.
14 Cervantes v. Auditor General, 91 Phil. 359; People v. Rosen that 68 Phil. 328.
15 Supra.
16 70 Phil. 340.
17 70 Phil. 726.
18. Supra.
19 236 U.S. 247.
20 320 U.S. 99.
21 69 Phil. 635.

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EN BANC

BAI SANDRA S. A. SEMA, G.R. No. 177597

PERFECTO F. MARQUEZ, G.R. No. 178628

COMMISSION ON ELECTIONS, Promulgated:

Considering the foregoing, the Commission RESOLVED, as it hereby resolves, to adopt

The petitions raise the following issues:

I. In G.R. No. 177597:

The Ruling of the Court

On the Preliminary Matters

Respondent Dilangalens Proclamation

Whether the ARMM Regional Assembly

Legislative Districts are Created or Reapportioned

SECTION 5. (1) The House of Representatives shall be composed of not more

(3) Each legislative district shall comprise, as far as practicable, contiguous,

Except as may be provided by national law, the existing legislative district,

Each legislative district shall comprise, as far as practicable, contiguous, compact,

and Section 3 of the Ordinance appended to the Constitution, which states:

The contention has no merit.

The Constitution ordains:

The House of Representatives shall be composed of not more than one

(2) The proportional representation in the House of Representatives based on one

Atty. Vistan II:[35]

Atty. Vistan II:

Yes, Your Honor, under the correct factual circumstances.

Atty. Vistan II:

Atty. Vistan II:

Yes, Your Honor.[36] (Emphasis supplied)

Resolution No. 7902 Complies with the Constitution

WHEREFORE, we declare Section 19, Article VI of Republic Act No.

LEONARDO A. QUISUMBING CONSUELO YNARES-SANTIAGO

MA. ALICIA AUSTRIA-MARTINEZ RENATO C. CORONA

DANTE O. TINGA MINITA V. CHICO-NAZARIO

PRESBITERO J. VELASCO, JR. ANTONIO EDUARDO B. NACHURA

RUBEN T. REYES TERESITA J. LEONARDO-DE CASTRO

SECTION 19. Creation, Division or Abolition of Provinces, Cities,

WHEREAS, the Province of Maguindanao consists of two legislative districts,

WHEREAS, the last paragraph of Section 5 of Muslim Mindanao Autonomy

Considering the foregoing, the Commission RESOLVED, as it hereby

The Commission RESOLVED, as it hereby RESOLVES, to amend the pertinent portion

Section 50 of Republic Act No. 7839 (Charter of City of Pasig) provides:

Section 50. Legislative District. As highly urbanized, the City of Pasig

Section 58 of Republic Act No. RA 9230 provides:

Section 7 of Republic Act No. 9355 provides:

Section 7. Legislative District. The Province of Dinagat Islands shall constitute

ROMEO P. GEROCHI, KATULONG NG G.R. No. 159796

July 17, 2007

(b) Missionary electrification;[6]

(d) An environmental charge equivalent to one-fourth of one centavo per kilowatt-hour

WHEREFORE, the foregoing premises considered, the provisional authority

Relative thereto, NPC-SPUG is directed to submit a quarterly report on the following:

1. Projects for CY 2002 undertaken;

3) The imposition of the Universal Charge on all end-users is oppressive and

The ultimate issues in the case at bar are:

SECTION 5. The Supreme Court shall have the following powers:

1. Exercise original jurisdiction over cases affecting ambassadors, other public

(a) All cases in which the constitutionality or validity of any treaty,

The instant complaint is bereft of merit.

The First Issue

SECTION 2. Declaration of Policy. It is hereby declared the policy of the State:

(a) To ensure and accelerate the total electrification of the country;

The OSG is in point when it asseverates:

The Second Issue

WHEREFORE, the instant case is hereby DISMISSED for lack of merit.

ANTONIO EDUARDO B. NACHURA