5.

Delegation to Administrative Bodies

Problem
Solution

Scope
Validity

Problem
Specialization
Lack of competence
Growing modern complexity

Solution
Subordinate legislation
It refers to a legislative instrument made by an entity under a
power delegated to the entity by the Congress.

It can be necessary for legislative power to be

delegated for any of the following reasons:
To save pressure on Congress time

Legislation is too technical or detailed

To allow for swift action in the case of
an emergency.
To deal with rapidly changing or
uncertain situations

Note: Administrative bodies refer to principal

agencies tasked to execute laws in their specialized
fields
Examples:
Land Transportation Franchising Regulatory Board
Bureau of Customs
Maritime Industry Authority
Local Waters Utilities Administration

Scope
Supplementary Regulations

With this power, the administrative bodies may

implement the broad policies laid down in a statute by
filling in the details which the Congress may not have
the competence to provide.
These regulations have the force and effect of law
exception: unless declared null and void

Contingent Regulations
These may also be issued pursuant to a delegation
to determine some fact or state of things upon
which enforcement of law depends.
They are allowed to ascertain the existence of
particular contingencies and on the basis thereof
enforce or suspend the operation of a law.
It also has the force and effect of law.

In Cruz vs Youngberg,
The law involved here prohibit the entry of cattle
into the country of foreign cattle, which had been
determined by the Philippine Legislature as the cause of
an epidemic that killed many of the local livestock.
The same law, however authorized the GovernorGeneral to lift the prohibition, with the consent of the
presiding officers of the law making body, if he should
ascertain after a fact-finding investigation that there was
no longer any threat of contagion from imported cattle.

Validity
It must be authorized by the legislature;
It must be within the scope of authority given by the
legislature;
It must be promulgated in accordance with
prescribed procedure and;
It must be reasonable

Completeness test
Sufficient standard test

Completeness test
A law is complete when it sets forth therein the policy to
be executed, carried out or implemented by the
delegate.
Example of invalid delegation (in connection with
Completeness test) :
When the delegate have been given opportunity to
step into the shoes of the legislature and to repair
the gaps in the law that will prevent its
enforcement unless they are first filled.

United States v Ang Tang Ho

United States vs Ang Tang Ho

Facts:
July 1919, the Philippine Legislature
(during special session) passed and
approved Act No. 2868 entitled An Act
Penalizing the Monopoly and Hoarding
of Rice, Palay and Corn.
It authorizes the Governor General
(GG) to issue the necessary Rules and
Regulations
in
regulating
the
distribution of such products.
The said EO fixed the price at which
rice should be sold..

On the other hand, Ang Tang Ho, a rice

dealer, sold a ganta of rice to Pedro
Trinidad at the price of eighty centavos.
The said amount was way higher than
that prescribed by the EO.
He appealed the sentence countering
that there is an undue delegation of
power to the Governor General.

Issue:
Whether or not there is undue
delegation to the Governor General.

Held:
The said Act wholly fails to provide
definitely and clearly what the standard
policy should contain, so that it could
be put in use as a uniform policy
required to take the place of all others
without the determination of the
insurance commissioner in respect to
matters involving the exercise of a
legislative discretion that could not be
delegated, and without which the act
could not possibly be put in use.
Hence, there was an invalid delegation.

The law must be complete in all its

terms and provisions when it leaves the
legislative branch of the government
and nothing must be left to the
judgment of the electors or other
appointee or delegate of the legislature,
so that, in form and substance, it is a
law in all its details in presenti, but
which may be left to take effect in
future, if necessary, upon the
ascertainment of any prescribed fact or
event.

Sufficient Standard test

It is intended to map out the boundaries of the
delegates authority by
(1)defining the legislative policy;
(2) indicating circumstance under which it is to be
pursued and effected and;
(3) specifies the public agency to apply.

Sufficient standard test

To prevent a total
transference of legislative
power from the law making
body to the delegate.

Note:
Sufficient standard is
usually indicated in the
law delegating legislative
power.

Illustrations:
The Blue Sky law required the National Treasurer to
cancel certificates for the sale of the speculative
securities whenever necessary in the public interest
(People v Rosenthal, 68 Phil. 328).
Under R.A. No. 51, the President of the Philippines was
authorized to reorganize government-owned or
controlled corporations for the purpose of promoting
simplicity, economy and efficiency in their operations
(Cervaintes v. Auditor General, 91 Phil. 359).

Other accepted standards are:

Justice and equity

National Security
Sense and common
experience of man

Hirabayashi v United States

Facts: The petitioner challenged the regulation establishing
curfew hours for Niseis (American Citizens of Japanese
ancestry), during World War I. He claimed that the rule was
invalidly delegated legislative power, there being no sufficient
standard mentioned in the pertinent law to limit the delegates
discretion.
Held: The U.S Supreme Court held that there was a sufficient
standardthe national security. The proclamations themselves
followed a standard authorized by the Executive Order, the
necessity of protecting military resources in the designated areas
against espionage and sabotage.

People v. Vera
Probation Act was found unconstitutional being violative of the equal
protection clause and an invalid delegation of legislative power for
lack of sufficient standard.
The Probation Act was not to be effective immediately because it was
made to depend upon an act to be done by the provincial board of the
provinces, which of appropriating funds for the salary of a probation
officer.
If the provincial board makes the appropriation, the Probation Act is
applicable in that province; if it does not make the appropriation, the
law is not applicable therein. For purposes of the Probation Act, the
provincial boards may thus be regarded as administrative bodies
endowed with power to determine when the Act shall take effect in
their respective provinces.

 If the provincial board makes the appropriation, the

Probation Act is applicable in that province; if it does not
make the appropriation, the law is not applicable therein.
For purposes of the Probation Act, the provincial boards
may thus be regarded as administrative bodies endowed
with power to determine when the Act shall take effect in
their respective provinces.

However the law does not lay down any rule or standard to
guide the provincial boards in the exercise of their
discretionary power. The applicability and application of
the Probation Act are entirely placed in the hands of the
provincial boards with no standard or rule to guide them.
This is virtual surrender of legislative power to them.

Ynot v. Intermediate Appellate Court

Facts:
There had been an existing law which prohibited the
slaughtering of carabaos (EO 626).
To strengthen the law, Marcos issued EO 626-A which not
only banned the movement of carabaos from interprovinces but as well as the movement of carabeef.
Ynot was caught transporting 6 carabaos from Masbate to
Iloilo. He was then charged in violation of EO 626-A.

HELD
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.
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.

Gerochi v DOE
FACTS :

RA 9136, otherwise known as the Electric Power Industry

Reform Act of 2001 (EPIRA), sought to impose a universal
charge on all end-users of electricity for the purpose of
funding NAPOCORs projects. Petitioners contest the
constitutionality of the EPIRA on the following grounds:
The universal charge provided for under Sec. 34 of the
EPIRA.
The power to tax is strictly a legislative function and as
the delegation of said power to any executive or administrative
agency like the Energy Regulatory Commission is

 unconstitutional for 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.
The ERC was also empowered to approve and determine
where the funds collected should be used.
Issue:
Whether or not there is undue delegation of legislative power
to tax on the part of the ERC.

Held
There is no undue delegation of legislative power to the
ERC. 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. All that is required for the valid exercise of
the 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.

The Court finds that the EPIRA, in relation to Sec. 34

thereof, is complete in all its essential terms and
conditions, and that it contains sufficient standards.

 1st test - Although Sec. 34 of the EPIRA only provided that

within one (1) year from effectivity thereof, a Universal
Charge to be determined, fixed and approved by the ERC,
shall be imposed on all electricity end-users and did not
state the specific amount to be paid as Universal Charge,
the amount is nevertheless made certain by the legislative
parameters provided in the law itself.
2nd test - Provisions of the EPIRA such as, to ensure the
total electrification of the country; and the quality,
reliability, security and affordability of the supply of electric
power and watershed rehabilitation and management
meet the requirements for valid delegation, as they provide
the limitations on the ERCs power to formulate the
Implementing Rules and Regulations.

Abakada Guro Party List, et al vs. Exec. Sec.

Facts
The President signed Republic Act 9337 or the VAT Reform Act.
Before the law took effect the Court issued a TRO enjoining
government from implementing the law in response to petitions
for certiorari and prohibition questioning the constitutionality of
the new law.
Petitioners allege that the grant of stand-by authority to the
President to increase the VAT rate is an abdication by Congress
of its exclusive power to tax because such delegation is not
covered by Section 28 (2), Article VI of the Constitution.
Moreover, they allege that no guiding standards are made by law
as to how the Secretary of Finance will make the
recommendation.

Issue:
Whether or not the RA 9337's stand-by authority to the
Executive to increase the VAT rate constitutes undue
delegation of legislative power?

Held:
The powers which Congress is prohibited from delegating
are those which are strictly, or inherently and exclusively,
legislative. In this case, it is not a delegation of legislative
power but a delegation of ascertainment of facts upon
which enforcement and administration of the increased
rate under the law is contingent. It leaves the entire
operation or non-operation of the 12% rate upon factual
matters outside of the control of the executive The
exceptions are: (a) delegation of tariff powers to President
under Constitution; (b) delegation of emergency powers to
President under Constitution; (c) delegation to the people
at large ; (d) delegation to local governments ; (e)
delegation to administrative bodies

 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 connote a mandatory order. Its
use in a statute denotes an imperative obligation and is
inconsistent with the idea of discretion. 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
There was no undue delegation of legislative power
but only of the discretion as to the execution of a law
and this is constitutionally permissible. Congress did
not delegate the power to tax but the mere
implementation of the law.

ABAKADA GURO vs. PURISIMA

Republic Act No. 9335 was enacted to optimize the revenuegeneration capability and collection of the Bureau of Internal
Revenue (BIR) and the Bureau of Customs (BOC). It provides a
system of rewards and sanctions through the creation of
Rewards and Incentives Fund (Fund) and a Revenue
Performance Evaluation Board (Board) to BIR and BOC officials
and employees if they exceed their revenue targets. It covers
all officials and employees of the BIR and the BOC with at
least six months of service, regardless of employment status.
Petitioners, invoking their right as taxpayers, filed this petition
challenging the constitutionality of RA 9335, a tax reform
legislation. One of their contention is that the law unduly
delegates the power to fix revenue targets to the President as
it lacks sufficient standard on that matter.

Issue
Whether or not RA. 9335 unduly delegates the
power to fix revenue targets to the President
Held
Yes. RA. 9335 adequately states the policy and
standards to guide the President in fixing the revenue
targets and the implementing agencies in carrying out
the provisions of the law through Sec. 2 and Sec. 4 of
the law.
Supreme Court also recognized the following as
sufficient standards: (a) public interest; (b) justice and
equity; (c) public convenience and welfare; and (d)
simplicity, economy and welfare

SEC 2. Declaration of Policy. It is the policy of the State to

optimize the revenue-generation capability and collection of
the Bureau of Internal Revenue (BIR) and the Bureau of
Customs (BOC) by providing for a system of rewards and
sanctions through the creation of a Rewards and Incentives
Fund and a Revenue Performance Evaluation Board in the
above agencies for the purpose of encouraging their officials
and employees to exceed their revenue targets.
SEC. 4 Rewards and Incentives Fund. A rewards and
Incentives Fund, hereinafter referred to as the Fund, is hereby
created, to be sourced from the collection of the BIR and the
BOC in excess of their respective revenue targets of the year,
as determined by the Development Budget and Coordinating
Committee (DBCC).

Dagan vs PRC
Facts:
Philippine Racing Commission issued a directive
requiring Manila Jockey Club and Philippine Racing
Club, Inc to come up with their Clubs House Rule to
address the Equine Infectious Anemia (EIA) problem
and to rid their facilities of horses infected it.
Said directive was issued pursuant to Administrative
Order by the Department of Agriculture declaring it
unlawful for any person, firm or corporation to ship,
drive, or transport horses from any locality or place
except when accompanied by a certificate issued by
the authority of the Director of the Bureau of Animal
Industry (BAI).

 Thus, MJCI and PRCI ordered the owners of racehorses

stable in their establishments to submit the horses to
blood sampling and administration of the Coggins Test
to determine if they are infected.
Subsequently, Philracom issued copies of the
guidelines for the monitoring and eradication of EIA.
Despite resistance from petitioners, the blood testing
proceeded.
Issue:
Whether or not Philracom had unconstitutionally
delegated its rule-making power to PRCI and MJCI in
issuing the directive for them to come up with club rules.

Held:
The court finds no grave abuse of discretion on
the part of Philracom in issuing the contested
guidelines and on the part MJCI and PRCI in
complying with Philracoms directive. Philracoms
authority is drawn from P.D. No. 420. The
delegation made in the presidential decree is
valid.
It is valid only if the law is complete in itself and
fixes a standard to which the delegate must
conform in the performance of his functions. A
sufficient standard is one which indicates the
circumstances under which the legislative
command is to be effected.

 Philracom was created for the purpose of carrying out

the declared policy in Section 1 of said law.
Furthermore, Philracom was granted exclusive
jurisdiction and control over every aspect of the
conduct of horse racing, including the framing and
scheduling of races, the construction and safety of race
tracks, and the security of racing.
Section 9 of the law fixes the standards and limitations
to which Philracom must conform in the performance
of its functions. As to the supposed delegation by
Philracom of its rule-making powers to MJCI and PRCI,
there is no delegation of power to speak of between
Philracom, as the delegator and MJCI and PRCI as
delegates. The Philracom directive is merely instructive
in character.

 As proffered by MJCI, its duty is not derived from the

delegated authority of Philracom but arises from the
franchise granted to them by Congress.

Facts

Issue
Held
Case in
Connection

Facts
In 1964, President Ferdinand
Marcos issued executive orders creating 33
municipalities this was purportedly pursuant to
Section 68 of the Revised Administrative Code
which provides in part:
The President may by executive order define
the boundary of any municipality and
may change the seat of government within
any subdivision to such place therein as the
public welfare may require

 The then Vice President, Emmanuel Pelaez, as a taxpayer,

filed a special civil action to prohibit the auditor general
from disbursing funds to be appropriated for the said
municipalities.
Pelaez claims that the EOs were unconstitutional. He said
that Section 68 of the RAC had been impliedly repealed by
Section 3 of RA 2370 which provides that barrios may not
be created or their boundaries altered nor their names
changed except by Act of Congress.
Pelaez argues: If the President, under this new law, cannot
even create a barrio, how can he create a municipality
which is composed of several barrios, since barrios are
units of municipalities?

Issue
Whether or not Congress has delegated the power to
create barrios to the President by virtue of Sec. 68 of the
RAC

Held
No, there was no delegation here. 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 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.
as the public welfare may require
which would mean that the President may
exercise such power as the public welfare may require is
present, still, such will not replace the standard needed for
a proper delegation of power. It immediately precedes
hence, the proper interpretation is the
President may change the seat of government within any
subdivision to such place therein as the public welfare may
require.

Only the seat of government may be changed by the President

when public welfare so requires and NOT the creation of
municipality.

 The Supreme Court declared that the power

to create municipalities is essentially and
eminently legislative in character not
administrative and not executive.

Cases in Connection
Cardona v Binangonan
Where the power of the Governor-General to transfer from
one municipality to another was sustained. The Supreme Court
upheld Pelaez and ruled that the completeness test and the
sufficient standard test which had theretofore been applied
alternatively, must be applied together or currently.
Bureau of Customs Employees Association v. Teves
The Supreme Court similarly ruled that the two tests
determine the validity of the delegation and these tests were fully
satisfied by R.A. No. 9335 (An Act To Improve The Revenue
Collection Performance Of The Bureau Of Internal Revenue (BIR)
And The Bureau Of Customs (BOC) Through The Creation Of A
Rewards And Incentives Fund And Of A Revenue Performance
Evaluation Board And For Other Purposes) as evident in Sections 2,
4 and 7 thereof.