RUTH E.

BARBIBI; ASSOCIATION OF CALTEX

DEALERS OF THE PHILIPPINES represented
by its President, MERCEDITAS A. GARCIA;
EN BANC ROSARIO ANTONIO doing business under the
name and style of ANB NORTH SHELL
SERVICE STATION; LOURDES MARTINEZ
ABAKADA GURO PARTY LIST (Formerly G.R. No. 168056 doing business under the name and style of
AASJAS) OFFICERS SAMSON S. SHELL GATE N. DOMINGO; BETHZAIDA TAN
ALCANTARA and ED VINCENT S. ALBANO, doing business under the name and style of
Petitioners, Present: ADVANCE SHELL STATION; REYNALDO P.
MONTOYA doing business under the name and
DAVIDE, JR., C.J., style of NEW LAMUAN SHELL SERVICE
PUNO, STATION; EFREN SOTTO doing business
PANGANIBAN, under the name and style of RED FIELD SHELL
QUISUMBING, SERVICE STATION; DONICA CORPORATION
YNARES-SANTIAGO, represented by its President, DESI
SANDOVAL-GUTIERREZ, TOMACRUZ; RUTH E. MARBIBI doing business
- versus - CARPIO, under the name and style of R&R PETRON
AUSTRIA-MARTINEZ, STATION; PETER M. UNGSON doing business
CORONA, under the name and style of CLASSIC STAR
CARPIO-MORALES, GASOLINE SERVICE STATION; MARIAN
CALLEJO, SR., SHEILA A. LEE doing business under the name
AZCUNA, and style of NTE GASOLINE & SERVICE
TINGA, STATION; JULIAN CESAR P. POSADAS doing
CHICO-NAZARIO, and business under the name and style of
GARCIA, JJ. STARCARGA ENTERPRISES; ADORACION
THE HONORABLE EXECUTIVE SECRETARY MAEBO doing business under the name and
EDUARDO ERMITA; HONORABLE style of CMA MOTORISTS CENTER; SUSAN M.
SECRETARY OF THE DEPARTMENT OF ENTRATA doing business under the name and
FINANCE CESAR PURISIMA; and HONORABLE style of LEONAS GASOLINE STATION and
COMMISSIONER OF INTERNAL REVENUE SERVICE CENTER; CARMELITA BALDONADO
GUILLERMO PARAYNO, JR., doing business under the name and style of
Respondents. FIRST CHOICE SERVICE CENTER;
MERCEDITAS A. GARCIA doing business
x-------------------------x under the name and style of LORPED SERVICE
CENTER; RHEAMAR A. RAMOS doing
AQUILINO Q. PIMENTEL, JR., LUISA P. G.R. No. 168207 business under the name and style of RJRAM
EJERCITO-ESTRADA, JINGGOY E. ESTRADA, PTT GAS STATION; MA. ISABEL VIOLAGO
PANFILO M. LACSON, ALFREDO S. LIM, doing business under the name and style of
JAMBY A.S. MADRIGAL, AND SERGIO R. VIOLAGO-PTT SERVICE CENTER; MOTORISTS
OSMEA III, HEART CORPORATION represented by its
Petitioners, Vice-President for Operations, JOSELITO F.
FLORDELIZA; MOTORISTS HARVARD
- versus - CORPORATION represented by its Vice-
President for Operations, JOSELITO F.
EXECUTIVE SECRETARY EDUARDO R. FLORDELIZA; MOTORISTS HERITAGE
ERMITA, CESAR V. PURISIMA, SECRETARY CORPORATION represented by its Vice-
OF FINANCE, GUILLERMO L. PARAYNO, JR., President for Operations, JOSELITO F.
COMMISSIONER OF THE BUREAU OF FLORDELIZA; PHILIPPINE STANDARD OIL
INTERNAL REVENUE, CORPORATION represented by its Vice-
Respondents. President for Operations, JOSELITO F.
FLORDELIZA; ROMEO MANUEL doing
x-------------------------x business under the name and style of
ROMMAN GASOLINE STATION; ANTHONY
ASSOCIATION OF PILIPINAS SHELL G.R. No. 168461 ALBERT CRUZ III doing business under the
DEALERS, INC. represented by its President, name and style of TRUE SERVICE STATION,
ROSARIO ANTONIO; PETRON DEALERS Petitioners,
ASSOCIATION represented by its President,
 - versus - AUSTRIA-MARTINEZ, J.:

CESAR V. PURISIMA, in his capacity as

Secretary of the Department of Finance and
GUILLERMO L. PARAYNO, JR., in his capacity The expenses of government, having for their object the interest
as Commissioner of Internal Revenue, of all, should be borne by everyone, and the more man enjoys the
Respondents. advantages of society, the more he ought to hold himself honored in
contributing to those expenses.
x-------------------------x
-Anne Robert Jacques Turgot (1727-1781)
FRANCIS JOSEPH G. ESCUDERO, VINCENT G.R. No. 168463 French statesman and economist
CRISOLOGO, EMMANUEL JOEL J.
VILLANUEVA, RODOLFO G. PLAZA, DARLENE
ANTONINO-CUSTODIO, OSCAR G.
MALAPITAN, BENJAMIN C. AGARAO, JR. Mounting budget deficit, revenue generation, inadequate fiscal allocation for
JUAN EDGARDO M. ANGARA, JUSTIN MARC
SB. CHIPECO, FLORENCIO G. NOEL, MUJIV S. education, increased emoluments for health workers, and wider coverage for full value-added
HATAMAN, RENATO B. MAGTUBO, JOSEPH A.
SANTIAGO, TEOFISTO DL. GUINGONA III, RUY tax benefits these are the reasons why Republic Act No. 9337 (R.A. No. 9337) [1] was enacted.
ELIAS C. LOPEZ, RODOLFO Q. AGBAYANI and
TEODORO A. CASIO, Reasons, the wisdom of which, the Court even with its extensive constitutional power of review,
Petitioners,
cannot probe. The petitioners in these cases, however, question not only the wisdom of the law,
- versus -
but also perceived constitutional infirmities in its passage.
CESAR V. PURISIMA, in his capacity as
Secretary of Finance, GUILLERMO L.
Every law enjoys in its favor the presumption of constitutionality. Their arguments
PARAYNO, JR., in his capacity as
Commissioner of Internal Revenue, and
notwithstanding, petitioners failed to justify their call for the invalidity of the law. Hence, R.A. No.
EDUARDO R. ERMITA, in his capacity as
Executive Secretary,
9337 is not unconstitutional.
Respondents.

x-------------------------x LEGISLATIVE HISTORY

BATAAN GOVERNOR ENRIQUE T. GARCIA, G.R. No. 168730
JR. R.A. No. 9337 is a consolidation of three legislative bills namely, House Bill Nos. 3555
Petitioner,
and 3705, and Senate Bill No. 1950.
- 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,
Respondents.
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
Promulgated: Representatives approved the bill on second and third reading.
September 1, 2005

x-----------------------------------------------------------x 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
DECISION
mother bill is House Bill No. 3555. The House Committee on Ways and Means approved the bill
 were complaining that the gas prices went up
on February 2, 2005. The President also certified it as urgent on February 8, 2005. The House of by 10%. Some people were complaining that
their electric bill will go up by 10%. Other
Representatives approved the bill on second and third reading on February 28, 2005. times people riding in domestic air carrier
were complaining that the prices that theyll
have to pay would have to go up by 10%.
Meanwhile, the Senate Committee on Ways and Means approved Senate Bill No. While all that was being aired, per your
presentation and per our own understanding
1950[4] on March 7, 2005, in substitution of Senate Bill Nos. 1337, 1838 and 1873, taking into of the law, thats not true. Its not true that the
e-vat law necessarily increased prices by
consideration House Bill Nos. 3555 and 3705. Senator Ralph G. Recto sponsored Senate Bill 10% uniformly isnt it?

No. 1337, while Senate Bill Nos. 1838 and 1873 were both sponsored by Sens. Franklin M. ATTY. BANIQUED : No, Your Honor.

Drilon, Juan M. Flavier and Francis N. Pangilinan. The President certified the bill on March 11, J. PANGANIBAN : It is not?
2005, and was approved by the Senate on second and third reading on April 13, 2005. ATTY. BANIQUED : Its not, because, Your Honor, there is an Executive
Order that granted the Petroleum companies
some subsidy . . . interrupted
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. J. PANGANIBAN : Thats correct . . .

ATTY. BANIQUED : . . . and therefore that was meant to temper the impact
Before long, the Conference Committee on the Disagreeing Provisions of House Bill . . . interrupted
No. 3555, House Bill No. 3705, and Senate Bill No. 1950, after having met and discussed in full
J. PANGANIBAN : . . . mitigating measures . . .
free and conference, recommended the approval of its report, which the Senate did on May 10,
ATTY. BANIQUED : Yes, Your Honor.
2005, and with the House of Representatives agreeing thereto the next day, May 11, 2005.
J. PANGANIBAN : As a matter of fact a part of the mitigating measures
would be the elimination of the Excise Tax
On May 23, 2005, the enrolled copy of the consolidated House and Senate version
and the import duties. That is why, it is not
correct to say that the VAT as to petroleum
was transmitted to the President, who signed the same into law on May 24, 2005. Thus, came
dealers increased prices by 10%.
R.A. No. 9337.
ATTY. BANIQUED : Yes, Your Honor.

July 1, 2005 is the effectivity date of R.A. No. 9337.[5] When said date came, the Court J. PANGANIBAN : And therefore, there is no justification for increasing the
retail price by 10% to cover the E-Vat tax. If
issued a temporary restraining order, effective immediately and continuing until further orders, you consider the excise tax and the import
duties, the Net Tax would probably be in the
enjoining respondents from enforcing and implementing the law. neighborhood of 7%? We are not going into
exact figures I am just trying to deliver a point
that different industries, different products,
Oral arguments were held on July 14, 2005. Significantly, during the hearing, the different services are hit differently. So its not
correct to say that all prices must go up by
Court speaking through Mr. Justice Artemio V. Panganiban, voiced the rationale for its issuance 10%.
ATTY. BANIQUED : Youre right, Your Honor.
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 J. PANGANIBAN : Now. For instance, Domestic Airline companies, Mr.
know when the law took effect on July 1, Counsel, are at present imposed a Sales Tax
2005, the Court issued a TRO at about 5 of 3%. When this E-Vat law took effect the
oclock in the afternoon. But before that, there Sales Tax was also removed as a mitigating
was a lot of complaints aired on television measure. So, therefore, there is no
and on radio. Some people in a gas station
 justification to increase the fares by 10% at
best 7%, correct? . . . That the President, upon the recommendation of the
Secretary of Finance, shall, effective January 1, 2006, raise the rate of
ATTY. BANIQUED : I guess so, Your Honor, yes. value-added tax to twelve percent (12%), after any of the following
conditions has been satisfied:
J. PANGANIBAN : There are other products that the people were
complaining on that first day, were being (i) Value-added tax collection as a percentage of Gross Domestic
increased arbitrarily by 10%. And thats one Product (GDP) of the previous year exceeds two and four-fifth percent (2
reason among many others this Court had to 4/5%); or
issue TRO because of the confusion in the
implementation. Thats why we added as an (ii) National government deficit as a percentage of GDP of the
issue in this case, even if its tangentially previous year exceeds one and one-half percent (1 %).
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 Petitioners argue that the law is unconstitutional, as it constitutes abandonment by
increase of 10%, which you yourself now
admit and I think even the Government will Congress of its exclusive authority to fix the rate of taxes under Article VI, Section 28(2) of the
admit is incorrect. In some cases, it should be
3% only, in some cases it should be 6% 1987 Philippine Constitution.
depending on these mitigating measures and
the location and situation of each product, of
each service, of each company, isnt it? G.R. No. 168207

ATTY. BANIQUED : Yes, Your Honor.

On June 9, 2005, Sen. Aquilino Q. Pimentel, Jr., et al., filed a petition
J. PANGANIBAN : Alright. So thats one reason why we had to issue a TRO
pending the clarification of all these and we for certiorari likewise assailing the constitutionality of Sections 4, 5 and 6 of R.A. No. 9337.
wish the government will take time to clarify
all these by means of a more detailed Aside from questioning the so-called stand-by authority of the President to increase
implementing rules, in case the law is upheld
by this Court. . . .[6] 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 Court also directed the parties to file their respective Memoranda.
the Constitution, as it imposes an unfair and additional tax burden on the people, in that: (1) the

G.R. No. 168056 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
Before R.A. No. 9337 took effect, petitioners ABAKADA GURO Party List, et al., filed a
people are unsure of the applicable VAT rate from year to year; and (3) the increase in the VAT
petition for prohibition on May 27, 2005. They question the constitutionality of Sections 4, 5 and
rate, which is supposed to be an incentive to the President to raise the VAT collection to at least
6 of R.A. No. 9337, amending Sections 106, 107 and 108, respectively, of the National Internal
2 4/5 of the GDP of the previous year, should only be based on fiscal adequacy.
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 Petitioners further claim that the inclusion of a stand-by authority granted to the

services and use or lease of properties. These questioned provisions contain a President by the Bicameral Conference Committee is a violation of the no-amendment rule upon

uniform proviso authorizing the President, upon recommendation of the Secretary of Finance, to last reading of a bill laid down in Article VI, Section 26(2) of the Constitution.

raise the VAT rate to 12%, effective January 1, 2006, after any of the following conditions have
G.R. No. 168461
been satisfied, to wit:
 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
b. Article VI, Section 28(2)
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:
a. Article VI, Section 28(1), and
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.
[17] [18]
8241 or the Improved VAT Law, R.A. No. 8424 or the Tax Reform Act of 1997, 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
b. Article VI, Section 26(2)
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.
...
 But the cases, both here and abroad, in
The creation of such conference committee was apparently in response to a problem, varying forms of expression, all deny to the courts
the power to inquire into allegations that, in
not addressed by any constitutional provision, where the two houses of Congress find enacting a law, a House of Congress failed to
comply with its own rules, in the absence of
themselves in disagreement over changes or amendments introduced by the other house in a showing that there was a violation of a
constitutional provision or the rights of private
legislative bill. Given that one of the most basic powers of the legislative branch is to formulate individuals. In Osmea v. Pendatun, it was held: At any
rate, courts have declared that the rules adopted by
and implement its own rules of proceedings and to discipline its members, may the Court then deliberative bodies are subject to revocation,
modification or waiver at the pleasure of the body
delve into the details of how Congress complies with its internal rules or how it conducts its adopting them. And it has been said that
Parliamentary rules are merely procedural, and with
business of passing legislation? Note that in the present petitions, the issue is not whether their observance, the courts have no concern. They
may be waived or disregarded by the legislative
provisions of the rules of both houses creating the bicameral conference committee are body. Consequently, mere failure to conform to
parliamentary usage will not invalidate the action
unconstitutional, but whether the bicameral conference committee has strictly complied (taken by a deliberative body) when the requisite
number of members have agreed to a particular
with the rules of both houses, thereby remaining within the jurisdiction conferred upon it measure.[21] (Emphasis supplied)
by Congress.

The foregoing declaration is exactly in point with the present cases, where petitioners
In the recent case of Farias vs. The Executive Secretary,[20] the Court En
allege irregularities committed by the conference committee in introducing changes or deleting
Banc, unanimously reiterated and emphasized its adherence to the enrolled bill doctrine, thus,
provisions in the House and Senate bills. Akin to the Farias case,[22] the present petitions also
declining therein petitioners plea for the Court to go behind the enrolled copy of the bill. Assailed
raise an issue regarding the actions taken by the conference committee on matters regarding
in said case was Congresss creation of two sets of bicameral conference committees, the lack of
Congress compliance with its own internal rules. As stated earlier, one of the most basic and
records of said committees proceedings, the alleged violation of said committees of the rules of
inherent power of the legislature is the power to formulate rules for its proceedings and the
both houses, and the disappearance or deletion of one of the provisions in the compromise bill
discipline of its members. Congress is the best judge of how it should conduct its own business
submitted by the bicameral conference committee. It was argued that such irregularities in the
expeditiously and in the most orderly manner. It is also the sole
passage of the law nullified R.A. No. 9006, or the Fair Election Act.
concern of Congress to instill discipline among the members of its conference committee if it
Striking down such argument, the Court held thus: believes that said members violated any of its rules of proceedings. Even the expanded
Under the enrolled bill doctrine, the signing of a bill by the jurisdiction of this Court cannot apply to questions regarding only the internal operation of
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 Congress, thus, the Court is wont to deny a review of the internal proceedings of a co-equal
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 branch of government.
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 Moreover, as far back as 1994 or more than ten years ago, in the case of Tolentino vs.
House. This Court is not the proper forum for the enforcement of these
internal rules of Congress, whether House or Senate. Parliamentary Secretary of Finance,[23] the Court already made the pronouncement that [i]f a change is
rules are merely procedural and with their observance the courts have
no concern. Whatever doubts there may be as to the formal validity of desired in the practice [of the Bicameral Conference Committee] it must be sought in
Rep. Act No. 9006 must be resolved in its favor. The Court reiterates its
ruling in Arroyo vs. De Venecia, viz.: 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
 companies or sellers, distribution companies, as
adverted to by the Court. It seems, therefore, that Congress finds the practices of the bicameral respectively, and shall not well as those of franchise
be passed on to consumers grantees of electric utilities
conference committee to be very useful for purposes of prompt and efficient legislative action. shall not apply to residential
end-users. VAT shall be
absorbed by generation,
Nevertheless, just to put minds at ease that no blatant irregularities tainted the transmission, and distribution
companies.
proceedings of the bicameral conference committees, the Court deems it necessary to dwell on With regard to 70% limit on input tax credit

the issue. The Court observes that there was a necessity for a conference committee because a
Provides that the input No similar provision Provides that the input tax
comparison of the provisions of House Bill Nos. 3555 and 3705 on one hand, and Senate Bill
tax credit for capital credit for capital goods on
goods on which a VAT which a VAT has been paid
No. 1950 on the other, reveals that there were indeed disagreements. As pointed out in the
has been paid shall be shall be equally distributed
petitions, said disagreements were as follows: equally distributed over over 5 years or the
5 years or the depreciable life of such
House Bill No. 3555 House Bill No.3705 Senate Bill No. 1950 depreciable life of such capital goods; the input tax
capital goods; the input credit for goods and services
tax credit for goods and other than capital goods shall
services other than not exceed 90% of the output
With regard to Stand-By Authority in favor of President capital goods shall not VAT.
exceed 5% of the total
amount of such goods
Provides for 12% VAT Provides for 12% VAT in Provides for a single rate of and services; and for
on every sale of goods general on sales of goods or 10% VAT on sale of goods or persons engaged in
or properties (amending properties and reduced properties (amending Sec. retail trading of goods,
Sec. 106 of NIRC); 12% rates for sale of certain 106 of NIRC), 10% VAT on the allowable input tax
VAT on importation of locally manufactured goods sale of services including credit shall not exceed
goods (amending Sec. and petroleum products and sale of electricity by 11% of the total amount
107 of NIRC); and 12% raw materials to be used in generation companies, of goods purchased.
VAT on sale of services the manufacture thereof transmission and distribution
and use or lease of (amending Sec. 106 of companies, and use or lease
properties (amending NIRC); 12% VAT on of properties (amending Sec.
Sec. 108 of NIRC) importation of goods and 108 of NIRC) With regard to amendments to be made to NIRC provisions regarding income and
reduced rates for certain excise taxes
imported products including
petroleum products
(amending Sec. 107 of No similar provision No similar provision Provided for amendments to
NIRC); and 12% VAT on several NIRC provisions
sale of services and use or regarding corporate income,
lease of properties and a percentage, franchise and
reduced rate for certain excise taxes
services including power
generation (amending Sec.
108 of NIRC)
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
With regard to the no pass-on provision
electricity generation, transmission and distribution companies should not be passed on to

No similar provision
Provides that the VAT
imposed on power
generation and on the sale
of petroleum products shall
be absorbed by generation
consumers, as proposed in the Senate bill, or both the VAT imposed on electricity generation,
Provides that the VAT
imposed on sales of
transmission and distribution companies and the VAT imposed on sale of petroleum products
electricity by generation
companies and services of should not be passed on to consumers, as proposed in the House bill; (3) in what manner input
transmission companies and
tax credits should be limited; (4) and whether the NIRC provisions on corporate income taxes,
3. With regard to the disagreement on whether input tax credits should be limited or
percentage, franchise and excise taxes should be amended.
not, the Bicameral Conference Committee decided to adopt the position of the House by putting
There being differences and/or disagreements on the foregoing provisions of the
a limitation on the amount of input tax that may be credited against the output tax, although it
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. crafted its own language as to the amount of the limitation on input tax credits and the manner of

The Bicameral Conference Committee acted on the disagreeing provisions by making the
computing the same by providing thus:
following changes:
(A) Creditable Input Tax. . . .

...
1. With regard to the disagreement on the rate of VAT to be imposed, it would appear
Provided, The input tax on goods purchased or
imported in a calendar month for use in trade or
from the Conference Committee Report that the Bicameral Conference Committee tried to
business for which deduction for depreciation is allowed
under this Code, shall be spread evenly over the month
bridge the gap in the difference between the 10% VAT rate proposed by the Senate, and the of acquisition and the fifty-nine (59) succeeding months
if the aggregate acquisition cost for such goods,
excluding the VAT component thereof, exceeds one
various rates with 12% as the highest VAT rate proposed by the House, by striking a 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,
compromise whereby the present 10% VAT rate would be retained until certain conditions then the input VAT shall be spread over such shorter
period: . . .
arise, i.e., the value-added tax collection as a percentage of gross domestic product (GDP) of
(B) Excess Output or Input Tax. If at the end of any
taxable quarter the output tax exceeds the input tax, the
the previous year exceeds 2 4/5%, or National Government deficit as a percentage of GDP of 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:
the previous year exceeds 1%, when the President, upon recommendation of the Secretary of 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
Finance shall raise the rate of VAT to 12% effective January 1, 2006. 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
2. With regard to the disagreement on whether only the VAT imposed on electricity option be refunded or credited against other internal
revenue taxes, . . .
generation, transmission and distribution companies should not be passed on to consumers or

whether both the VAT imposed on electricity generation, transmission and distribution
4. With regard to the amendments to other provisions of the NIRC on corporate
companies and the VAT imposed on sale of petroleum products may be passed on to
income tax, franchise, percentage and excise taxes, the conference committee decided to
consumers, the Bicameral Conference Committee chose to settle such disagreement by
include such amendments and basically adopted the provisions found in Senate Bill No. 1950,
altogether deleting from its Report any no pass-on provision.
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)
 disagreeing provisions in bills that have been acted upon by both houses of Congress is
B. R.A. No. 9337 Does Not Violate Article VI, Section
26(2) of the Constitution on the No- prohibited.
Amendment Rule
C. R.A. No. 9337 Does Not Violate Article VI, Section
24 of the Constitution on Exclusive
Origination of Revenue Bills
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 Coming to the issue of the validity of the amendments made regarding the NIRC
final form have been distributed to its Members three days before its
passage, except when the President certifies to the necessity of its provisions on corporate income taxes and percentage, excise taxes. Petitioners refer to the
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 following provisions, to wit:
thereon shall be taken immediately thereafter, and the yeas and nays
entered in the Journal. Section
27
Rates of Income Tax on
Domestic Corporation
Petitioners argument that the practice where a bicameral conference committee is 28(A)(1) Tax on Resident Foreign
Corporation
allowed to add or delete provisions in the House bill and the Senate bill after these had passed
28(B)(1) Inter-corporate Dividends
three readings is in effect a circumvention of the no amendment rule (Sec. 26 (2), Art. VI of the
34(B)(1) Inter-corporate Dividends
1987 Constitution), fails to convince the Court to deviate from its ruling in the Tolentino case 116 Tax on Persons Exempt from
VAT
that:
117 Percentage Tax on domestic
Nor is there any reason for requiring that the Committees Report carriers and keepers of Garage
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 119 Tax on franchises
house may seek modification of the compromise bill. . . . 121 Tax on banks and Non-Bank
Financial Intermediaries
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 148 Excise Tax on manufactured oils
the conference committee report.[32](Emphasis supplied) and other fuels
151 Excise Tax on mineral products
236 Registration requirements
The Court reiterates here that the no-amendment rule refers only to the procedure
237 Issuance of receipts or sales or
to be followed by each house of Congress with regard to bills initiated in each of said commercial invoices

respective houses, before said bill is transmitted to the other house for its concurrence 288 Disposition of Incremental
Revenue
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
Petitioners claim that the amendments to these provisions of the NIRC did not at all
house of Congress would be deprived of its constitutional power to amend or introduce changes
originate from the House. They aver that House Bill No. 3555 proposed amendments only
to said bill. Thus, Art. VI, Sec. 26 (2) of the Constitution cannot be taken to mean that the
regarding Sections 106, 107, 108, 110 and 114 of the NIRC, while House Bill No. 3705 proposed
introduction by the Bicameral Conference Committee of amendments and modifications to
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 them that not because there is a light at the end of the tunnel, this
reiterated that we all acknowledged that on top of our agenda must be the government will keep on making the tunnel long.
restoration of the health of our fiscal system.
The responsibility will not rest solely on the weary shoulders of
In order to considerably lower the consolidated public sector the small man. Big business will be there to share the burden.[35]
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 As the Court has said, the Senate can propose amendments and in fact, the
existing tax rates, evaluating the relevance given our present
conditions.[34] (Emphasis supplied) 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.

Notably therefore, the main purpose of the bills emanating from the House of

Representatives is to bring in sizeable revenues for the government Likewise, the Court finds the sections referring to other percentage and excise taxes

to supplement our countrys serious financial problems, and improve tax administration and germane to the reforms to the VAT system, as these sections would cushion the effects of VAT

control of the leakages in revenues from income taxes and value-added taxes. As these house on consumers. Considering that certain goods and services which were subject to percentage

bills were transmitted to the Senate, the latter, approaching the measures from the point of tax and excise tax would no longer be VAT-exempt, the consumer would be burdened more as

national perspective, can introduce amendments within the purposes of those bills. It can they would be paying the VAT in addition to these taxes. Thus, there is a need to amend these

provide for ways that would soften the impact of the VAT measure on the consumer, i.e., by sections to soften the impact of VAT. Again, in his sponsorship speech, Sen. Recto said:

distributing the burden across all sectors instead of putting it entirely on the shoulders of the 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
consumers. The sponsorship speech of Sen. Ralph Recto on why the provisions on income tax product.

on corporation were included is worth quoting:

For electric utilities like Meralco, we will wipe out the franchise tax
All in all, the proposal of the Senate Committee on Ways and in exchange for a VAT.
Means will raise P64.3 billion in additional revenues annually even while by
mitigating prices of power, services and petroleum products. 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
However, not all of this will be wrung out of VAT. In fact, the excise tax on socially sensitive products such as diesel, bunker, fuel and
only P48.7 billion amount is from the VAT on twelve goods and services. kerosene.
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 What do all these exercises point to? These are not contortions of
pain? Why should the fiscal salvation be only on the burden of the giving to the left hand what was taken from the right. Rather, these sprang
consumer? 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 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 The other sections amended by the Senate pertained to matters of tax administration
rate of 32 percent, but two notches lower, to 30 percent.
which are necessary for the implementation of the changes in the VAT system.
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 To reiterate, the sections introduced by the Senate are germane to the subject matter
have an expiry date.
and purposes of the house bills, which is to supplement our countrys fiscal deficit, among others.
For their assistance, a reward of tax reduction awaits them. We
Thus, the Senate acted within its power to propose those amendments.
intend to keep the length of their sacrifice brief. We would like to assure

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. Article VI, Section 28(1), and
b. Article VI, Section 28(2)
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
(ii) national government deficit as a percentage of
GDP of the previous 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
(ii) national government deficit as a percentage of
GDP of the previous 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 by the President since the former is a mere alter ego of the latter, such that, ultimately, it is the

provides: President who decides whether to impose the increased tax rate or not.

The Congress may, by law, authorize the President to fix within

specified limits, and may impose, tariff rates, import and export quotas, A brief discourse on the principle of non-delegation of powers is instructive.
tonnage and wharfage dues, and other duties or imposts within the
framework of the national development program of the government.
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
They argue that the VAT is a tax levied on the sale, barter or exchange of goods and
constitutionally allocated sphere.[37] A logical
properties as well as on the sale or exchange of services, which cannot be included within the
corollary to the doctrine of separation of powers is the principle of non-delegation of powers, as
purview of tariffs under the exempted delegation as the latter refers to customs duties, tolls or
expressed in the Latin maxim: potestas delegata non delegari potest which means what has
tribute payable upon merchandise to the government and usually imposed on goods or
been delegated, cannot be delegated.[38] This doctrine is based on the ethical principle that such
merchandise imported or exported.
as delegated power constitutes not only a right but a duty to be performed by the delegate

Petitioners ABAKADA GURO Party List, et al., further contend that delegating to the through the instrumentality of his own judgment and not through the intervening mind of

President the legislative power to tax is contrary to republicanism. They insist that accountability, another.[39]

responsibility and transparency should dictate the actions of Congress and they should not pass
With respect to the Legislature, Section 1 of Article VI of the Constitution provides
to the President the decision to impose taxes. They also argue that the law also effectively
that the Legislative power shall be vested in the Congress of the Philippines which shall consist
nullified the Presidents power of control, which includes the authority to set aside and nullify the
of a Senate and a House of Representatives. The powers which Congress is prohibited from
acts of her subordinates like the Secretary of Finance, by mandating the fixing of the tax rate by
delegating are those which are strictly, or inherently and exclusively, legislative. Purely
the President upon the recommendation of the Secretary of Finance.
legislative power, which can never be delegated, has been described as the authority to make

Petitioners Pimentel, et al. aver that the President has ample powers to cause, a complete law complete as to the time when it shall take effect and as to whom it shall be

influence or create the conditions provided by the law to bring about either or both the conditions applicable and to determine the expediency of its enactment.[40] Thus, the rule is that in

precedent. 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,
On the other hand, petitioners Escudero, et al. find bizarre and revolting the situation
one appertaining exclusively to the legislative department. It is the nature of the power, and not
that the imposition of the 12% rate would be subject to the whim of the Secretary of Finance, an
the liability of its use or the manner of its exercise, which determines the validity of its delegation.
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 Nonetheless, the general rule barring delegation of legislative powers is subject to the

not even give his recommendation. Moreover, they allege that no guiding standards are provided following recognized limitations or exceptions:

in the law on what basis and as to how he will make his recommendation. They claim, (1) Delegation of tariff powers to the President under Section 28 (2) of
Article VI of the Constitution;
nonetheless, that any recommendation of the Secretary of Finance can easily be brushed aside
 (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.
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
rate under the law is contingent. The legislature has made the operation of the 12% rate
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 effective January 1, 2006, contingent upon a specified fact or condition. It leaves the entire

operation depends.[50] operation or non-operation of the 12% rate upon factual matters outside of the control of the

The rationale for this is that the preliminary ascertainment of facts as basis for the executive.

enactment of legislation is not of itself a legislative function, but is simply ancillary to legislation.
No discretion would be exercised by the President. Highlighting the absence of
Thus, the duty of correlating information and making recommendations is the kind of subsidiary
discretion is the fact that the word shall is used in the common proviso. The use of the
activity which the legislature may perform through its members, or which it may delegate to
word shall connotes a mandatory order. Its use in a statute denotes an imperative obligation
others to perform. Intelligent legislation on the complicated problems of modern society is
and is inconsistent with the idea of discretion.[53] Where the law is clear and unambiguous, it
impossible in the absence of accurate information on the part of the legislators, and any
must be taken to mean exactly what it says, and courts have no choice but to see to it that the
reasonable method of securing such information is proper.[51] The Constitution as a continuously
mandate is obeyed.[54]
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 Thus, it is the ministerial duty of the President to immediately impose the 12% rate

determinations which it has declared to be prerequisite to application of legislative policy to upon the existence of any of the conditions specified by Congress. This is a duty which cannot
[52]
particular facts and circumstances impossible for Congress itself properly to investigate. 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%
In the present case, the challenged section of R.A. No. 9337 is the common proviso in
VAT rate when the specified conditions are present. The time of taking into effect of the 12%
Sections 4, 5 and 6 which reads as follows:
VAT rate is based on the happening of a certain specified contingency, or upon the
That the President, upon the recommendation of the Secretary of
Finance, shall, effective January 1, 2006, raise the rate of value-added tax ascertainment of certain facts or conditions by a person or body other than the legislature itself.
to twelve percent (12%), after any of the following conditions has been
satisfied:
The Court finds no merit to the contention of petitioners ABAKADA GURO Party List,
(i) Value-added tax collection as a
percentage of Gross Domestic Product (GDP) of the et al. that the law effectively nullified the Presidents power of control over the Secretary of
previous year exceeds two and four-fifth percent (2
4/5%); or Finance by mandating the fixing of the tax rate by the President upon the recommendation of the

(ii) National government deficit as a Secretary of Finance. The Court cannot also subscribe to the position of petitioners
percentage of GDP of the previous year exceeds one
and one-half percent (1 %). 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
The case before the Court is not a delegation of legislative power. It is simply a
can easily be brushed aside by the President since the former is a mere alter ego of the latter.
delegation of ascertainment of facts upon which enforcement and administration of the increase
 When one speaks of the Secretary of Finance as the alter ego of the President, it exceeds one and one-half percent (1%). If either of these two instances has occurred, the

simply means that as head of the Department of Finance he is the assistant and agent of the Secretary of Finance, by legislative mandate, must submit such information to the President.

Chief Executive. The multifarious executive and administrative functions of the Chief Executive Then the 12% VAT rate must be imposed by the President effective January 1, 2006. There is

are performed by and through the executive departments, and the acts of the secretaries of such no undue delegation of legislative power but only of the discretion as to the execution of

departments, such as the Department of Finance, performed and promulgated in the regular a law. This is constitutionally permissible.[57] Congress does not abdicate its functions or

course of business, are, unless disapproved or reprobated by the Chief Executive, presumptively unduly delegate power when it describes what job must be done, who must do it, and what is the

the acts of the Chief Executive. The Secretary of Finance, as such, occupies a political position scope of his authority; in our complex economy that is frequently the only way in which the

and holds office in an advisory capacity, and, in the language of Thomas Jefferson, "should be legislative process can go forward. [58]

of the President's bosom confidence" and, in the language of Attorney-General Cushing, is

As to the argument of petitioners ABAKADA GURO Party List, et al. that delegating to
subject to the direction of the President."[55]
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
In the present case, in making his recommendation to the President on the existence
Congress and the task of the President is to simply execute the legislative policy. That Congress
of either of the two conditions, the Secretary of Finance is not acting as the alter ego of the
chose to do so in such a manner is not within the province of the Court to inquire into, its task
President or even her subordinate. In such instance, he is not subject to the power of control and
being to interpret the law.[59]
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
The insinuation by petitioners Pimentel, et al. that the President has ample powers to cause,
becomes the means or tool by which legislative policy is determined and implemented,
influence or create the conditions to bring about either or both the conditions precedent does not
considering that he possesses all the facilities to gather data and information and has a much
deserve any merit as this argument is highly speculative. The Court does not rule on allegations
broader perspective to properly evaluate them. His function is to gather and collate statistical
which are manifestly conjectural, as these may not exist at all.The Court deals with facts, not
data and other pertinent information and verify if any of the two conditions laid out by Congress
fancies; on realities, not appearances. When the Court acts on appearances instead of realities,
is present. His personality in such instance is in reality but a projection of that of
justice and law will be short-lived.
Congress. Thus, being the agent of Congress and not of the President, the President cannot
B. The 12% Increase VAT Rate Does Not Impose an
alter or modify or nullify, or set aside the findings of the Secretary of Finance and to substitute Unfair and Unnecessary Additional Tax
Burden
the judgment of the former for that of the latter.

Congress simply granted the Secretary of Finance the authority to ascertain the Petitioners Pimentel, et al. argue that the 12% increase in the VAT rate imposes an
existence of a fact, namely, whether by December 31, 2005, the value-added tax collection as a
unfair and additional tax burden on the people. Petitioners also argue that the 12% increase,
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 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
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
not 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. opinions does not suffice to bring them within the range of judicial
Again, that shows you that this is not a sustainable situation. cognizance.[66]

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. In the same vein, the Court in this case will not dawdle on the purpose of Congress or

What do I mean by that? the executive policy, given that it is not for the judiciary to "pass upon questions of wisdom,

In the past five years, weve been lucky because we were justice or expediency of legislation.[67]
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 II.
ability to borrow at reasonable prices is going to be challenged. In fact, Whether Section 8 of R.A. No. 9337, amending Sections 110(A)(2) and 110(B) of the NIRC; and
ultimately, the question is our ability to access the financial markets. Section 12 of R.A. No. 9337, amending Section 114(C) of the NIRC, violate the following
provisions of the Constitution:
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 a. Article VI, Section 28(1), and
most financial institutions. So, we were assuming that raising 80 billion b. Article III, Section 1
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 A. Due Process and Equal Protection Clauses
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 Petitioners Association of Pilipinas Shell Dealers, Inc., et al. argue that Section 8 of
favorable and up to now we have not accessed and we might pull back
because the conditions are not very good. R.A. No. 9337, amending Sections 110 (A)(2), 110 (B), and Section 12 of R.A. No. 9337,

So given this situation, we at the Department of Finance believe amending Section 114 (C) of the NIRC are arbitrary, oppressive, excessive and confiscatory.
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 Their argument is premised on the constitutional right against deprivation of life, liberty of
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 property without due process of law, as embodied in Article III, Section 1 of the Constitution.
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]
Petitioners also contend that these provisions violate the constitutional guarantee of

equal protection of the law.

The image portrayed is chilling. Congress passed the law hoping for rescue from an
The doctrine is that where the due process and equal protection clauses are invoked,
inevitable catastrophe. Whether the law is indeed sufficient to answer the states economic
considering that they are not fixed rules but rather broad standards, there is a need for proof of
dilemma is not for the Court to judge. In the Farias case, the Court refused to consider the
such persuasive character as would lead to such a conclusion. Absent such a showing, the
various arguments raised therein that dwelt on the wisdom of Section 14 of R.A. No. 9006 (The
presumption of validity must prevail.[68]
Fair Election Act), pronouncing that:

. . . policy matters are not the concern of the Court. Government Section 8 of R.A. No. 9337, amending Section 110(B) of the NIRC imposes a limitation
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 on the amount of input tax that may be credited against the output tax. It states, in part:
legislative determination. Indeed, whether an enactment is wise or unwise,
whether it is based on sound economic theory, whether it is the best means [P]rovided, that the input tax inclusive of the input VAT carried over from the previous quarter
to achieve the desired results, whether, in short, the legislative discretion
within its prescribed limits should be exercised in a particular manner are that may be credited in every quarter shall not exceed seventy percent (70%) of the output VAT:
matters for the judgment of the legislature, and the serious conflict of
 Input Tax is defined under Section 110(A) of the NIRC, as amended, as the value- Therefore, petitioners argument must be rejected.

added tax due from or paid by a VAT-registered person on the importation of goods or local
On the other hand, it appears that petitioner Garcia failed to comprehend the
purchase of good and services, including lease or use of property, in the course of trade or
operation of the 70% limitation on the input tax. According to petitioner, the limitation on the
business, from a VAT-registered person, and Output Tax is the value-added tax due on the sale
creditable input tax in effect allows VAT-registered establishments to retain a portion of the taxes
or lease of taxable goods or properties or services by any person registered or required to
they collect, which violates the principle that tax collection and revenue should be for public
register under the law.
purposes and expenditures

As earlier stated, the input tax is the tax paid by a person, passed on to him by the
Petitioners claim that the contested sections impose limitations on the amount of input
seller, when he buys goods. Output tax meanwhile is the tax due to the person when he sells
tax that may be claimed. In effect, a portion of the input tax that has already been paid cannot
goods. In computing the VAT payable, three possible scenarios may arise:
now be credited against the output tax.

First, if at the end of a taxable quarter the output taxes charged by the seller are equal
Petitioners argument is not absolute. It assumes that the input tax exceeds 70% of the
to the input taxes that he paid and passed on by the suppliers, then no payment is required;
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 Second, when the output taxes exceed the input taxes, the person shall be liable for

creditable. the excess, which has to be paid to the Bureau of Internal Revenue (BIR);[69] and

More importantly, the excess input tax, if any, is retained in a businesss books of Third, if the input taxes exceed the output taxes, the excess shall be carried over to

accounts and remains creditable in the succeeding quarter/s. This is explicitly allowed by the succeeding quarter or quarters. Should the input taxes result from zero-rated or effectively

Section 110(B), which provides that if the input tax exceeds the output tax, the excess shall be zero-rated transactions, any excess over the output taxes shall instead be refunded to the

carried over to the succeeding quarter or quarters. In addition, Section 112(B) allows a VAT- taxpayer or credited against other internal revenue taxes, at the taxpayers option.[70]

registered person to apply for the issuance of a tax credit certificate or refund for any unused
Section 8 of R.A. No. 9337 however, imposed a 70% limitation on the input tax. Thus,
input taxes, to the extent that such input taxes have not been applied against the output taxes.
a person can credit his input tax only up to the extent of 70% of the output tax. In laymans term,
Such unused input tax may be used in payment of his other internal revenue taxes.
the value-added taxes that a person/taxpayer paid and passed on to him by a seller can only be

The non-application of the unutilized input tax in a given quarter is not ad infinitum, as credited up to 70% of the value-added taxes that is due to him on a taxable transaction. There is

petitioners exaggeratedly contend. Their analysis of the effect of the 70% limitation is incomplete no retention of any tax collection because the person/taxpayer has already previously paid the

and one-sided. It ends at the net effect that there will be unapplied/unutilized inputs VAT for a input tax to a seller, and the seller will subsequently remit such input tax to the BIR. The party

given quarter. It does not proceed further to the fact that such unapplied/unutilized input tax may directly liable for the payment of the tax is the seller. [71] What only needs to be done is for the

be credited in the subsequent periods as allowed by the carry-over provision of Section 110(B) person/taxpayer to apply or credit these input taxes, as evidenced by receipts, against his output

or that it may later on be refunded through a tax credit certificate under Section 112(B). 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 argument is pedantic, if not outright baseless. The law does not make any

the excess may form part of the cost. Equally, should the actual input tax be less than 5%, the classification in the subject of taxation, the kind of property, the rates to be levied or the amounts

difference is treated as income.[81] to be raised, the methods of assessment, valuation and collection. Petitioners alleged

distinctions are based on variables that bear different consequences. While the implementation
Petitioners also argue that by imposing a limitation on the creditable input tax, the
of the law may yield varying end results depending on ones profit margin and value-added, the
government gets to tax a profit or value-added even if there is no profit or value-added.
Court cannot go beyond what the legislature has laid down and interfere with the affairs of

Petitioners stance is purely hypothetical, argumentative, and again, one-sided. The business.

Court will not engage in a legal joust where premises are what ifs, arguments, theoretical and The equal protection clause does not require the universal application of the laws on

facts, uncertain. Any disquisition by the Court on this point will only be, as Shakespeare all persons or things without distinction. This might in fact sometimes result in unequal

describes life in Macbeth,[82] full of sound and fury, signifying nothing. protection. What the clause requires is equality among equals as determined according to a

valid classification. By classification is meant the grouping of persons or things similar to each
Whats more, petitioners contention assumes the proposition that there is no profit or
other in certain particulars and different from all others in these same particulars.[85]
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
Petitioners brought to the Courts attention the introduction of Senate Bill No. 2038 by
that a business is created precisely for profit.
Sens. S.R. Osmea III and Ma. Ana Consuelo A.S. Madrigal on June 6, 2005, and House Bill No.
The equal protection clause under the Constitution means that no person or class of
4493 by Rep. Eric D. Singson. The proposed legislation seeks to amend the 70% limitation by
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.[83] increasing the same to 90%. This, according to petitioners, supports their stance that the 70%

The power of the State to make reasonable and natural classifications for the limitation is arbitrary and confiscatory. On this score, suffice it to say that these are still proposed

purposes of taxation has long been established. Whether it relates to the subject of taxation, the
legislations. Until Congress amends the law, and absent any unequivocal basis for its
kind of property, the rates to be levied, or the amounts to be raised, the methods of assessment,
unconstitutionality, the 70% limitation stays.
valuation and collection, the States power is entitled to presumption of validity. As a rule, the

judiciary will not interfere with such power absent a clear showing of unreasonableness, B. Uniformity and Equitability of Taxation

discrimination, or arbitrariness.[84]
Article VI, Section 28(1) of the Constitution reads:
Petitioners point out that the limitation on the creditable input tax if the entity has a
The rule of taxation shall be uniform and equitable. The Congress
high ratio of input tax, or invests in capital equipment, or has several transactions with the shall evolve a progressive system of taxation.

government, is not based on real and substantial differences to meet a valid classification.
 Uniformity in taxation means that all taxable articles or kinds of property of the same percentage tax on VAT-exempt persons under Section 109(v), i.e., transactions with gross

class shall be taxed at the same rate. Different articles may be taxed at different amounts annual sales and/or receipts not exceeding P1.5 Million. This acts as a equalizer because in

provided that the rate is uniform on the same class everywhere with all people at all times. [86] effect, bigger businesses that qualify for VAT coverage and VAT-exempt taxpayers stand on

equal-footing.
In this case, the tax law is uniform as it provides a standard rate of 0% or 10% (or

12%) on all goods and services. Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106, Moreover, Congress provided mitigating measures to cushion the impact of the

107 and 108, respectively, of the NIRC, provide for a rate of 10% (or 12%) on sale of goods and imposition of the tax on those previously exempt. Excise taxes on petroleum products[91]and

properties, importation of goods, and sale of services and use or lease of properties. These natural gas[92] were reduced. Percentage tax on domestic carriers was removed.[93] Power

same sections also provide for a 0% rate on certain sales and transaction. producers are now exempt from paying franchise tax.[94]

Neither does the law make any distinction as to the type of industry or trade that will Aside from these, Congress also increased the income tax rates of corporations, in

bear the 70% limitation on the creditable input tax, 5-year amortization of input tax paid on order to distribute the burden of taxation. Domestic, foreign, and non-resident corporations are

purchase of capital goods or the 5% final withholding tax by the government. It must be stressed now subject to a 35% income tax rate, from a previous 32%.[95] Intercorporate dividends of non-

that the rule of uniform taxation does not deprive Congress of the power to classify subjects of resident foreign corporations are still subject to 15% final withholding tax but the tax credit

taxation, and only demands uniformity within the particular class. [87] allowed on the corporations domicile was increased to 20%. [96] The Philippine Amusement and

Gaming Corporation (PAGCOR) is not exempt from income taxes anymore.[97] Even the sale by
R.A. No. 9337 is also equitable. The law is equipped with a threshold margin. The
an artist of his works or services performed for the production of such works was not spared.
VAT rate of 0% or 10% (or 12%) does not apply to sales of goods or services with gross annual

sales or receipts not exceeding P1,500,000.00.[88] Also, basic marine and agricultural food All these were designed to ease, as well as spread out, the burden of taxation, which

products in their original state are still not subject to the tax, [89] thus ensuring that prices at the would otherwise rest largely on the consumers. It cannot therefore be gainsaid that R.A. No.

grassroots level will remain accessible. As was stated in Kapatiran ng mga Naglilingkod sa 9337 is equitable.

Pamahalaan ng Pilipinas, Inc. vs. Tan:[90] C. Progressivity of Taxation

The disputed sales tax is also equitable. It is imposed only on

sales of goods or services by persons engaged in business with an
aggregate gross annual sales exceeding P200,000.00. Small corner sari- Lastly, petitioners contend that the limitation on the creditable input tax is anything but
sari stores are consequently exempt from its application. Likewise exempt
from the tax are sales of farm and marine products, so that the costs of regressive. It is the smaller business with higher input tax-output tax ratio that will suffer the
basic food and other necessities, spared as they are from the incidence of
the VAT, are expected to be relatively lower and within the reach of the consequences.
general public.

Progressive taxation is built on the principle of the taxpayers ability to pay. This

It is admitted that R.A. No. 9337 puts a premium on businesses with low profit principle was also lifted from Adam Smiths Canons of Taxation, and it states:

margins, and unduly favors those with high profit margins. Congress was not oblivious to this. I. The subjects of every state ought to contribute towards the support of the
government, as nearly as possible, in proportion to their
Thus, to equalize the weighty burden the law entails, the law, under Section 116, imposed a 3% respective abilities; that is, in proportion to the revenue which they
respectively enjoy under the protection of the state.
 Taxation is progressive when its rate goes up depending on the resources of the It has been said that taxes are the lifeblood of the government. In this case, it is just
[98]
person affected. an enema, a first-aid measure to resuscitate an economy in distress. The Court is neither blind

nor is it turning a deaf ear on the plight of the masses. But it does not have the panacea for the
The VAT is an antithesis of progressive taxation. By its very nature, it is regressive.
malady that the law seeks to remedy. As in other cases, the Court cannot strike down a law as
The principle of progressive taxation has no relation with the VAT system inasmuch as the VAT
unconstitutional simply because of its yokes.
paid by the consumer or business for every goods bought or services enjoyed is the same
Let us not be overly influenced by the plea that for every wrong
regardless of income. In there is a remedy, and that the judiciary should stand ready to afford relief.
There are undoubtedly many wrongs the judicature may not correct, for
other words, the VAT paid eats the same portion of an income, whether big or small. The instance, those involving political questions. . . .

disparity lies in the income earned by a person or profit margin marked by a business, such that
the higher the income or profit margin, the smaller the portion of the income or profit that is eaten
by VAT. A converso, the lower the income or profit margin, the bigger the part that the VAT eats
away. At the end of the day, it is really the lower income group or businesses with low-profit
margins that is always hardest hit.
Let us likewise disabuse our minds from the notion that the
judiciary is the repository of remedies for all political or social ills; We should
not forget that the Constitution has judiciously allocated the powers of
government to three distinct and separate compartments; and that judicial
interpretation has tended to the preservation of the independence of the
three, and a zealous regard of the prerogatives of each, knowing full well
that one is not the guardian of the others and that, for official wrong-doing,
each may be brought to account, either by impeachment, trial or by the
ballot box.[100]

Nevertheless, the Constitution does not really prohibit the imposition of indirect taxes,
The words of the Court in Vera vs. Avelino[101] holds true then, as it still holds true now.
like the VAT. What it simply provides is that Congress shall "evolve a progressive system of
All things considered, there is no raison d'tre for the unconstitutionality of R.A. No. 9337.
taxation." The Court stated in the Tolentino case, thus:

The Constitution does not really prohibit the imposition of indirect WHEREFORE, Republic Act No. 9337 not being unconstitutional, the petitions in G.R.
taxes which, like the VAT, are regressive. What it simply provides is that
Congress shall evolve a progressive system of taxation. The constitutional Nos. 168056, 168207, 168461, 168463, and 168730, are hereby DISMISSED.
provision has been interpreted to mean simply that direct taxes are . . . to be
preferred [and] as much as possible, indirect taxes should be minimized. (E.
FERNANDO, THE CONSTITUTION OF THE PHILIPPINES 221 (Second There being no constitutional impediment to the full enforcement and implementation
ed. 1977)) Indeed, the mandate to Congress is not to prescribe, but to
evolve, a progressive tax system. Otherwise, sales taxes, which perhaps of R.A. No. 9337, the temporary restraining order issued by the Court on July 1, 2005
are the oldest form of indirect taxes, would have been prohibited with the
proclamation of Art. VIII, 17 (1) of the 1973 Constitution from which the is LIFTED upon finality of herein decision.
present Art. VI, 28 (1) was taken. Sales taxes are also regressive.

Resort to indirect taxes should be minimized but not avoided

entirely because it is difficult, if not impossible, to avoid them by imposing
such taxes according to the taxpayers' ability to pay. In the case of the VAT,
the law minimizes the regressive effects of this imposition by providing for
zero rating of certain transactions (R.A. No. 7716, 3, amending 102 (b) of
the NIRC), while granting exemptions to other transactions. (R.A. No. 7716,
4 amending 103 of the NIRC)[99]

CONCLUSION
 EN BANC AVELINO J. CRUZ, JR., SECRETARY, DND
RONALDO V. PUNO, SECRETARY, DILG,
GENEROSO SENGA, AFP CHIEF OF STAFF,
PROF. RANDOLF S. DAVID, LORENZO TAADA III, G.R. No. 171396 ARTURO LOMIBAO, CHIEF PNP,
RONALD LLAMAS, H. HARRY L. ROQUE, JR., JOEL Respondents.
RUIZ BUTUYAN, ROGER R. RAYEL, GARY S. Present: x-------------------------------------------------x
MALLARI, ROMEL REGALADO BAGARES, KILUSANG MAYO UNO, REPRESENTED BY ITS
CHRISTOPHER F.C. BOLASTIG, PANGANIBAN, C.J., CHAIRPERSON ELMER C. LABOG AND
*
Petitioners, PUNO, SECRETARY GENERAL JOEL MAGLUNSOD,
QUISUMBING, NATIONAL FEDERATION OF LABOR UNIONS
- versus - YNARES-SANTIAGO, KILUSANG MAYO UNO (NAFLU-KMU),
SANDOVAL-GUTIERREZ, REPRESENTED BY ITS NATIONAL PRESIDENT,
CARPIO, JOSELITO V. USTAREZ, ANTONIO C. PASCUAL,
GLORIA MACAPAGAL-ARROYO, AS AUSTRIA-MARTINEZ, SALVADOR T. CARRANZA, EMILIA P. DAPULANG,
PRESIDENT AND COMMANDER-IN-CHIEF, CORONA, MARTIN CUSTODIO, JR., AND ROQUE M. TAN,
EXECUTIVE SECRETARY EDUARDO ERMITA, CARPIO MORALES, Petitioners,
HON. AVELINO CRUZ II, SECRETARY OF CALLEJO, SR.,
NATIONAL DEFENSE, GENERAL GENEROSO AZCUNA,
SENGA, CHIEF OF STAFF, ARMED FORCES OF TINGA,
THE PHILIPPINES, DIRECTOR GENERAL ARTURO CHICO-NAZARIO, G.R. No. 171483
LOMIBAO, CHIEF, PHILIPPINE NATIONAL POLICE, GARCIA, and - versus -
Respondents. VELASCO, JJ.
x-------------------------------------------------x
NIEZ CACHO-OLIVARES AND TRIBUNE Promulgated:
PUBLISHING CO., INC.,
Petitioners, May 3, 2006 HER EXCELLENCY, PRESIDENT GLORIA
MACAPAGAL-ARROYO, THE HONORABLE
EXECUTIVE SECRETARY, EDUARDO ERMITA,
- versus - G.R. No. 171409 THE CHIEF OF STAFF, ARMED FORCES OF THE
PHILIPPINES, GENEROSO SENGA, AND THE PNP
DIRECTOR GENERAL, ARTURO LOMIBAO,
HONORABLE SECRETARY EDUARDO ERMITA Respondents.
AND HONORABLE DIRECTOR GENERAL ARTURO x-------------------------------------------------x
C. LOMIBAO, ALTERNATIVE LAW GROUPS, INC. (ALG),
Respondents. Petitioner,
x-------------------------------------------------x - versus -
FRANCIS JOSEPH G. ESCUDERO, JOSEPH A.
SANTIAGO, TEODORO A. CASINO, AGAPITO A.
AQUINO, MARIO J. AGUJA, SATUR C. OCAMPO, EXECUTIVE SECRETARY EDUARDO R. ERMITA,
MUJIV S. HATAMAN, JUAN EDGARDO ANGARA, LT. GEN. GENEROSO SENGA, AND DIRECTOR
TEOFISTO DL. GUINGONA III, EMMANUEL JOSEL GENERAL ARTURO LOMIBAO,
J. VILLANUEVA, LIZA L. MAZA, IMEE R. MARCOS, G.R. No. 171485 Respondents.
RENATO B. MAGTUBO, JUSTIN MARC SB. x-------------------------------------------------x
CHIPECO, ROILO GOLEZ, DARLENE ANTONINO- JOSE ANSELMO I. CADIZ, FELICIANO M.
CUSTODIO, LORETTA ANN P. ROSALES, JOSEL G. BAUTISTA, ROMULO R. RIVERA, JOSE AMOR M.
VIRADOR, RAFAEL V. MARIANO, GILBERT C. AMORADO, ALICIA A. RISOS-VIDAL, FELIMON C.
REMULLA, FLORENCIO G. NOEL, ANA THERESIA ABELITA III, MANUEL P. LEGASPI, J.B. JOVY C.
HONTIVEROS-BARAQUEL, IMELDA C. NICOLAS, BERNABE, BERNARD L. DAGCUTA, ROGELIO V.
MARVIC M.V.F. LEONEN, NERI JAVIER GARCIA AND INTEGRATED BAR OF THE
COLMENARES, MOVEMENT OF CONCERNED PHILIPPINES (IBP),
CITIZENS FOR CIVIL LIBERTIES REPRESENTED Petitioners, G.R. No. 171400
BY AMADO GAT INCIONG,
Petitioners, - versus -

- versus -
HON. EXECUTIVE SECRETARY EDUARDO
ERMITA, GENERAL GENEROSO SENGA, IN HIS
EDUARDO R. ERMITA, EXECUTIVE SECRETARY, CAPACITY AS AFP CHIEF OF STAFF, AND
DIRECTOR GENERAL ARTURO LOMIBAO, IN HIS
CAPACITY AS PNP CHIEF, dispossessed and the weak. Laws and actions that restrict fundamental rights come to the
Respondents.
courts with a heavy presumption against their constitutional validity.[2]
x-------------------------------------------------x
LOREN B. LEGARDA,
Petitioner,
These seven (7) consolidated petitions for certiorari and prohibition allege that in issuing
- versus - G.R. No. 171489 Presidential Proclamation No. 1017 (PP 1017) and General Order No. 5 (G.O. No. 5),

President Gloria Macapagal-Arroyo committed grave abuse of discretion. Petitioners contend

GLORIA MACAPAGAL-ARROYO, IN HER CAPACITY
AS PRESIDENT AND COMMANDER-IN-CHIEF; that respondent officials of the Government, in their professed efforts to defend and preserve
ARTURO LOMIBAO, IN HIS CAPACITY AS democratic institutions, are actually trampling upon the very freedom guaranteed and protected
DIRECTOR-GENERAL OF THE PHILIPPINE
NATIONAL POLICE (PNP); GENEROSO SENGA, IN by the Constitution. Hence, such issuances are void for being unconstitutional.
HIS CAPACITY AS CHIEF OF STAFF OF THE
ARMED FORCES OF THE PHILIPPINES (AFP); AND
EDUARDO ERMITA, IN HIS CAPACITY AS
EXECUTIVE SECRETARY,
Respondents.
Once again, the Court is faced with an age-old but persistently modern problem. How

does the Constitution of a free people combine the degree of liberty, without which, law

becomes tyranny, with the degree of law, without which, liberty becomes license?[3]

On February 24, 2006, as the nation celebrated the 20th Anniversary of the Edsa People

Power I, President Arroyo issued PP 1017 declaring a state of national emergency, thus:
G.R. No. 171424
NOW, THEREFORE, I, Gloria Macapagal-Arroyo, President of the
Republic of the Philippines and Commander-in-Chief of the Armed Forces of
the Philippines, by virtue of the powers vested upon me by Section 18,
x---------------------------------------------------------------------------------------------x
Article 7 of the Philippine Constitution which states that: The President. . .
whenever it becomes necessary, . . . may call out (the) armed forces to
prevent or suppress. . .rebellion. . ., and in my capacity as their
Commander-in-Chief, do hereby command the Armed Forces of the
DECISION
Philippines, to maintain law and order throughout the Philippines,
prevent or suppress all forms of lawless violence as well as any act of
insurrection or rebellion and to enforce obedience to all the laws and
SANDOVAL-GUTIERREZ, J.:
to all decrees, orders and regulations promulgated by me personally
or upon my direction; and as provided in Section 17, Article 12 of the
Constitution do hereby declare a State of National Emergency.
All powers need some restraint; practical adjustments rather than rigid formula are

necessary.[1] Superior strength the use of force cannot make wrongs into rights. In this
She cited the following facts as bases:
regard, the courts should be vigilant in safeguarding the constitutional rights of the citizens,
specifically their liberty.
Chief Justice Artemio V. Panganibans philosophy of liberty is thus most
relevant. He said: In cases involving liberty, the scales of justice should weigh heavily
against government and in favor of the poor, the oppressed, the marginalized, the
WHEREAS, over these past months, elements in the political
opposition have conspired with authoritarians of the extreme Left
represented by the NDF-CPP-NPA and the extreme Right, represented
by military adventurists the historical enemies of the democratic
Philippine State who are now in a tactical alliance and engaged in a
concerted and systematic conspiracy, over a broad front, to bring down the
duly constituted Government elected in May 2004;
 WHEREAS, these conspirators have repeatedly tried to bring
down the President;
WHEREAS, the claims of these elements have
recklessly magnified by certain segments of the national media;
WHEREAS, this series of actions is hurting the Philippine State
by obstructing governance including hindering the growth of the
economy and sabotaging the peoples confidence in government and
their faith in the future of this country;
WHEREAS, these actions are adversely affecting
economy;
WHEREAS, these activities give totalitarian forces of both the
extreme Left and extreme Right the opening to intensify their avowed
aims to bring down the democratic Philippine State;
WHEREAS, Article 2, Section 4 of the our Constitution makes the
defense and preservation of the democratic institutions and the State the
primary duty of Government;
WHEREAS, the activities above-described, their consequences,
ramifications and collateral effects constitute a clear and present danger to
the safety and the integrity of the Philippine State and of the Filipino people;
On the same day, the President issued G. O. No. 5 implementing PP 1017, thus:
WHEREAS, over these past months, elements in the political
opposition have conspired with authoritarians of the extreme Left,
represented by the NDF-CPP-NPA and the extreme Right, represented by
military adventurists - the historical enemies of the democratic Philippine
State and who are now in a tactical alliance and engaged in a concerted
and systematic conspiracy, over a broad front, to bring down the duly-
constituted Government elected in May 2004;
WHEREAS, these conspirators have repeatedly tried to bring down
our republican government;
WHEREAS, the claims of these elements have been recklessly
magnified by certain segments of the national media;
WHEREAS, these series of actions is hurting the Philippine State
by obstructing governance, including hindering the growth of the economy
and sabotaging the peoples confidence in the government and their faith
in the future of this country;
WHEREAS, these actions are adversely affecting the economy;
WHEREAS, these activities give totalitarian forces; of both the
extreme Left and extreme Right the opening to intensify their avowed aims
to bring down the democratic Philippine State;
WHEREAS, Article 2, Section 4 of our Constitution makes the
defense and preservation of the democratic institutions and the State the
primary duty of Government;
WHEREAS, the activities above-described, their consequences,
ramifications and collateral effects constitute a clear and present danger to
the safety and the integrity of the Philippine State and of the Filipino people;
been
WHEREAS, Proclamation 1017 date February 24, 2006 has been
issued declaring a State of National Emergency;
NOW, THEREFORE, I GLORIA MACAPAGAL-ARROYO, by
virtue of the powers vested in me under the Constitution as President of the
Republic of the Philippines, and Commander-in-Chief of the Republic of the
Philippines, and pursuant to Proclamation No. 1017 dated February 24,
the 2006, do hereby call upon the Armed Forces of the Philippines (AFP) and
the Philippine National Police (PNP), to prevent and suppress acts of
terrorism and lawless violence in the country;
I hereby direct the Chief of Staff of the AFP and the Chief of the
PNP, as well as the officers and men of the AFP and PNP, to immediately
carry out the necessary and appropriate actions and measures to
suppress and prevent acts of terrorism and lawless violence.
On March 3, 2006, exactly one week after the declaration of a state of national
emergency and after all these petitions had been filed, the President lifted PP 1017. She issued
Proclamation No. 1021 which reads:
WHEREAS, pursuant to Section 18, Article VII and Section 17,
Article XII of the Constitution, Proclamation No. 1017 dated February 24,
2006, was issued declaring a state of national emergency;
WHEREAS, by virtue of General Order No.5 and No.6 dated
February 24, 2006, which were issued on the basis of Proclamation No.
1017, the Armed Forces of the Philippines (AFP) and the Philippine
National Police (PNP), were directed to maintain law and order
throughout the Philippines, prevent and suppress all form of lawless
violence as well as any act of rebellion and to undertake such action as
may be necessary;
WHEREAS, the AFP and PNP have effectively prevented,
suppressed and quelled the acts lawless violence and rebellion;
NOW, THEREFORE, I, GLORIA MACAPAGAL-
ARROYO, President of the Republic of the Philippines, by virtue of the
powers vested in me by law, hereby declare that the state of national
emergency has ceased to exist.
In their presentation of the factual bases of PP 1017 and G.O. No. 5, respondents
stated that the proximate cause behind the executive issuances was the conspiracy among
some military officers, leftist insurgents of the New Peoples Army (NPA), and some members
of the political opposition in a plot to unseat or assassinate President Arroyo.[4] They considered
the aim to oust or assassinate the President and take-over the reigns of government as a clear documents.[7] Prior to his arrest, Lt. San Juan announced through DZRH that the Magdalos

and present danger. D-Day would be on February 24, 2006, the 20th Anniversary of Edsa I.

During the oral arguments held on March 7, 2006, the Solicitor General specified the On February 23, 2006, PNP Chief Arturo Lomibao intercepted information that

facts leading to the issuance of PP 1017 and G.O. No. 5. Significantly, there was no members of the PNP- Special Action Force were planning to defect. Thus, he immediately
refutation from petitioners counsels. ordered SAF Commanding General Marcelino Franco, Jr. to disavow any defection. The

latter promptly obeyed and issued a public statement: All SAF units are under the effective

The Solicitor General argued that the intent of the Constitution is to give control of responsible and trustworthy officers with proven integrity and unquestionable loyalty.

full discretionary powers to the President in determining the necessity of calling out the armed

forces. He emphasized that none of the petitioners has shown that PP 1017 was without factual On the same day, at the house of former Congressman Peping Cojuangco, President

bases. While he explained that it is not respondents task to state the facts behind the Cory Aquinos brother, businessmen and mid-level government officials plotted moves to bring

questioned Proclamation, however, they are presenting the same, narrated hereunder, for the down the Arroyo administration. Nelly Sindayen of TIME Magazine reported that Pastor Saycon,

elucidation of the issues. longtime Arroyo critic, called a U.S. government official about his groups plans if President

Arroyo is ousted. Saycon also phoned a man code-named Delta. Saycon identified him as
On January 17, 2006, Captain Nathaniel Rabonza and First Lieutenants
B/Gen. Danilo Lim, Commander of the Armys elite Scout Ranger. Lim said it was all systems
Sonny Sarmiento, Lawrence San Juan and Patricio Bumidang, members of the Magdalo Group
go for the planned movement against Arroyo.[8]
indicted in the Oakwood mutiny, escaped their detention cell in Fort Bonifacio, Taguig City. In a

public statement, they vowed to remain defiant and to elude arrest at all costs. They called upon
B/Gen. Danilo Lim and Brigade Commander Col. Ariel Querubin confided to Gen.
the people to show and proclaim our displeasure at the sham regime. Let us demonstrate our
Generoso Senga, Chief of Staff of the Armed Forces of the Philippines (AFP), that a huge
disgust, not only by going to the streets in protest, but also by wearing red bands on our left
number of soldiers would join the rallies to provide a critical mass and armed component to the
arms. [5]
Anti-Arroyo protests to be held on February 24, 2005. According to these two (2) officers, there

was no way they could possibly stop the soldiers because they too, were breaking the chain of
On February 17, 2006, the authorities got hold of a document entitled Oplan Hackle
command to join the forces foist to unseat the President. However, Gen. Senga has remained
I which detailed plans for bombings and attacks during the Philippine Military Academy Alumni
faithful to his Commander-in-Chief and to the chain of command. He immediately took custody
Homecoming in Baguio City. The plot was to assassinate selected targets including some
of B/Gen. Lim and directed Col. Querubin to return to the Philippine Marines Headquarters in
cabinet members and President Arroyo herself.[6] Upon the advice of her security, President
Fort Bonifacio.
Arroyo decided not to attend the Alumni Homecoming. The next day, at the height of the

celebration, a bomb was found and detonated at the PMA parade ground.
Earlier, the CPP-NPA called for intensification of political and revolutionary work within

the military and the police establishments in order to forge alliances with its members and key
On February 21, 2006, Lt. San Juan was recaptured in a communist safehouse in
officials. NPA spokesman Gregorio Ka Roger Rosal declared: The Communist Party and
Batangas province. Found in his possession were two (2) flash disks containing minutes of the
revolutionary movement and the entire people look forward to the possibility in the coming year
meetings between members of the Magdalo Group and the National Peoples Army (NPA), a

tape recorder, audio cassette cartridges, diskettes, and copies of subversive

of accomplishing its immediate task of bringing down the Arroyo regime; of rendering it to Gonzales stated that political rallies, which to the Presidents mind were organized for purposes
[9]
weaken and unable to rule that it will not take much longer to end it. of destabilization, are cancelled. Presidential Chief of Staff Michael Defensor announced that

warrantless arrests and take-over of facilities, including media, can already be

On the other hand, Cesar Renerio, spokesman for the National Democratic Front implemented.[11]

(NDF) at North Central Mindanao, publicly announced: Anti-Arroyo groups within the military

and police are growing rapidly, hastened by the economic difficulties suffered by the families of Undeterred by the announcements that rallies and public assemblies would not be

AFP officers and enlisted personnel who undertake counter-insurgency operations in the allowed, groups of protesters (members of Kilusang Mayo Uno [KMU] and National Federation

field. He claimed that with the forces of the national democratic movement, the anti-Arroyo of Labor Unions-Kilusang Mayo Uno [NAFLU-KMU]), marched from various parts of Metro

conservative political parties, coalitions, plus the groups that have been reinforcing since June Manila with the intention of converging at the EDSA shrine. Those who were already near the

2005, it is probable that the Presidents ouster is nearing its concluding stage in the first half of EDSA site were violently dispersed by huge clusters of anti-riot police. The well-trained

2006. policemen used truncheons, big fiber glass shields, water cannons, and tear gas to stop and

break up the marching groups, and scatter the massed participants. The same police action was

Respondents further claimed that the bombing of telecommunication towers and cell used against the protesters marching forward to Cubao, Quezon City and to the corner of

sites in Bulacan and Bataan was also considered as additional factual basis for the issuance of Santolan Street and EDSA. That same evening, hundreds of riot policemen broke up an EDSA

PP 1017 and G.O. No. 5. So is the raid of an army outpost in Benguet resulting in the death of celebration rally held along Ayala Avenue and Paseo de Roxas Street in Makati City.[12]

three (3) soldiers. And also the directive of the Communist Party of the Philippines ordering its

front organizations to join 5,000 Metro Manila radicals and 25,000 more from the provinces in According to petitioner Kilusang Mayo Uno, the police cited PP 1017 as the ground for

mass protests.[10] the dispersal of their assemblies.

By midnight of February 23, 2006, the President convened her security advisers and During the dispersal of the rallyists along EDSA, police arrested (without warrant)

several cabinet members to assess the gravity of the fermenting peace and order petitioner Randolf S. David, a professor at the University of the Philippines and newspaper

situation. She directed both the AFP and the PNP to account for all their men and ensure that columnist. Also arrested was his companion, Ronald Llamas, president of party-list Akbayan.

the chain of command remains solid and undivided. To protect the young students from any

possible trouble that might break loose on the streets, the President suspended classes in all At around 12:20 in the early morning of February 25, 2006, operatives of the Criminal
levels in the entire National Capital Region. Investigation and Detection Group (CIDG) of the PNP, on the basis of PP 1017 and G.O. No. 5,

raided the Daily Tribune offices in Manila. The raiding team confiscated news stories by
For their part, petitioners cited the events that followed after the issuance of PP reporters, documents, pictures, and mock-ups of the Saturday issue. Policemen from Camp

1017 and G.O. No. 5. Crame in Quezon City were stationed inside the editorial and business offices of the newspaper;

while policemen from the Manila Police District were stationed outside the building. [13]

Immediately, the Office of the President announced the cancellation of all programs

and activities related to the 20th anniversary celebration of Edsa People Power I; and revoked

the permits to hold rallies issued earlier by the local governments. Justice Secretary Raul
 A few minutes after the search and seizure at the Daily Tribune offices, the police Retired Major General Ramon Montao, former head of the Philippine Constabulary,

surrounded the premises of another pro-opposition paper, Malaya, and its sister publication, the was arrested while with his wife and golfmates at the Orchard Golf and Country Club in

tabloid Abante. Dasmarias, Cavite.

The raid, according to Presidential Chief of Staff Michael Defensor, is meant to Attempts were made to arrest Anakpawis Representative Satur Ocampo,

show a strong presence, to tell media outlets not to connive or do anything that would help Representative Rafael Mariano, Bayan Muna Representative Teodoro Casio and Gabriela

the rebels in bringing down this government. The PNP warned that it would take over any Representative Liza Maza. Bayan Muna Representative Josel Virador was arrested at the PAL

media organization that would not follow standards set by the government during the state of Ticket Office in Davao City. Later, he was turned over to the custody of the House of

national emergency. Director General Lomibao stated that if they do not follow the Representatives where the Batasan 5 decided to stay indefinitely.

standards and the standards are - if they would contribute to instability in the government, or if

they do not subscribe to what is in General Order No. 5 and Proc. No. 1017 we will Let it be stressed at this point that the alleged violations of the rights of
recommend a takeover. National Telecommunications Commissioner Ronald Solis urged Representatives Beltran, Satur Ocampo, et al., are not being raised in these petitions.
television and radio networks to cooperate with the government for the duration of the state

of national emergency. He asked for balanced reporting from broadcasters when covering On March 3, 2006, President Arroyo issued PP 1021 declaring that the state of
the events surrounding the coup attempt foiled by the government. He warned that his agency national emergency has ceased to exist.
will not hesitate to recommend the closure of any broadcast outfit that violates rules set out for

media coverage when the national security is threatened.[14]

In the interim, these seven (7) petitions challenging the constitutionality of PP 1017

and G.O. No. 5 were filed with this Court against the above-named respondents. Three (3) of
Also, on February 25, 2006, the police arrested Congressman Crispin Beltran, these petitions impleaded President Arroyo as respondent.
representing the Anakpawis Party and Chairman of Kilusang Mayo Uno (KMU), while leaving his

farmhouse in Bulacan. The police showed a warrant for his arrest dated 1985. Beltrans
In G.R. No. 171396, petitioners Randolf S. David, et al. assailed PP 1017 on the grounds
lawyer explained that the warrant, which stemmed from a case of inciting to rebellion filed during
that (1) it encroaches on the emergency powers of Congress; (2) it is a subterfuge to avoid the
the Marcos regime, had long been quashed. Beltran, however, is not a party in any of these
constitutional requirements for the imposition of martial law; and (3) it violates the constitutional
petitions.
guarantees of freedom of the press, of speech and of assembly.

When members of petitioner KMU went to Camp Crame to visit Beltran, they were told
In G.R. No. 171409, petitioners Ninez Cacho-Olivares and Tribune Publishing Co.,
they could not be admitted because of PP 1017 and G.O. No. 5. Two members were arrested
Inc. challenged the CIDGs act of raiding the Daily Tribune offices as a clear case of
and detained, while the rest were dispersed by the police.
censorship or prior restraint. They also claimed that the term emergency refers only

to tsunami, typhoon, hurricane and similar occurrences, hence, there is absolutely no

Bayan Muna Representative Satur Ocampo eluded arrest when the police went after emergency that warrants the issuance of PP 1017.
him during a public forum at the Sulo Hotel in Quezon City. But his two drivers, identified as

Roel and Art, were taken into custody.

 In G.R. No. 171485, petitioners herein are Representative Francis Joseph G. Escudero, regard, she stated that these issuances prevented her from fully prosecuting her election protest

and twenty one (21) other members of the House of Representatives, including Representatives pending before the Presidential Electoral Tribunal.

Satur Ocampo, Rafael Mariano, Teodoro Casio, Liza Maza, and Josel Virador. They asserted

that PP 1017 and G.O. No. 5 constitute usurpation of legislative powers; violation of
freedom of expression and a declaration of martial law. They alleged that President
Arroyo gravely abused her discretion in calling out the armed forces without clear and
verifiable factual basis of the possibility of lawless violence and a showing that there is
necessity to do so.
In respondents Consolidated Comment, the Solicitor General countered that: first, the
petitions should be dismissed for being moot; second, petitioners in G.R. Nos. 171400
(ALGI), 171424 (Legarda), 171483 (KMU et al.), 171485 (Escudero et al.) and 171489 (Cadiz et
al.) have no legal standing; third, it is not necessary for petitioners to implead President Arroyo
as respondent; fourth, PP 1017 has constitutional and legal basis; and fifth, PP 1017 does not

violate the peoples right to free expression and redress of grievances.

In G.R. No. 171483, petitioners KMU, NAFLU-KMU, and their members averred that PP

1017 and G.O. No. 5 are unconstitutional because (1) they arrogate unto President Arroyo the On March 7, 2006, the Court conducted oral arguments and heard the parties on the
power to enact laws and decrees; (2) their issuance was without factual basis; and (3) they above interlocking issues which may be summarized as follows:
violate freedom of expression and the right of the people to peaceably assemble to redress their

grievances. A. PROCEDURAL:

1) Whether the issuance of PP 1021 renders the petitions moot

In G.R. No. 171400, petitioner Alternative Law Groups, Inc. (ALGI) alleged that PP and academic.
1017 and G.O. No. 5 are unconstitutional because they violate (a) Section 4[15] of Article 2) Whether petitioners in 171485 (Escudero et al.), G.R. Nos.
II, (b) Sections 1,[16] 2,[17] and 4[18] of Article III, (c) Section 23[19] of Article VI, and (d) Section 171400 (ALGI), 171483 (KMU et al.), 171489 (Cadiz et al.),
17[20] of Article XII of the Constitution. and 171424 (Legarda) have legal standing.

B. SUBSTANTIVE:

In G.R. No. 171489, petitioners Jose Anselmo I. Cadiz et al., alleged that PP 1017 is 1) Whether the Supreme Court can review the factual bases of

an arbitrary and unlawful exercise by the President of her Martial Law powers. And PP 1017.

assuming that PP 1017 is not really a declaration of Martial Law, petitioners argued that it 2) Whether PP 1017 and G.O. No. 5 are unconstitutional.
a. Facial Challenge
amounts to an exercise by the President of emergency powers without congressional b. Constitutional Basis
c. As Applied Challenge
approval. In addition, petitioners asserted that PP 1017 goes beyond the nature and function

of a proclamation as defined under the Revised Administrative Code. A. PROCEDURAL

First, we must resolve the procedural roadblocks.

And lastly, in G.R. No. 171424, petitioner Loren B. Legarda maintained that PP 1017

and G.O. No. 5 are unconstitutional for being violative of the freedom of expression, including
I- Moot and Academic Principle
its cognate rights such as freedom of the press and the right to access to information on matters

of public concern, all guaranteed under Article III, Section 4 of the 1987 Constitution. In this
 One of the greatest contributions of the American system to this country is the concept of
judicial review enunciated in Marbury v. Madison.[21] This concept rests on the extraordinary
simple foundation --
The Constitution is the supreme law. It was ordained by the people,
the ultimate source of all political authority. It confers limited powers on the
national government. x x x If the government consciously or
unconsciously oversteps these limitations there must be some
authority competent to hold it in control, to thwart its unconstitutional
attempt, and thus to vindicate and preserve inviolate the will of the
people as expressed in the Constitution. This power the courts
exercise. This is the beginning and the end of the theory of judicial
review.[22]
But the power of judicial review does not repose upon the courts a self-starting
capacity.[23] Courts may exercise such power only when the following requisites are
present: first, there must be an actual case or controversy; second, petitioners have to raise a
question of constitutionality; third, the constitutional question must be raised at the earliest
opportunity; and fourth, the decision of the constitutional question must be necessary to the
determination of the case itself.[24]
Respondents maintain that the first and second requisites are absent, hence, we shall
limit our discussion thereon.
An actual case or controversy involves a conflict of legal right, an opposite legal claims
susceptible of judicial resolution. It is definite and concrete, touching the legal relations of
parties having adverse legal interest; a real and substantial controversy admitting of specific
relief.[25] The Solicitor General refutes the existence of such actual case or controversy,
contending that the present petitions were rendered moot and academic by President
Arroyos issuance of PP 1021.
Such contention lacks merit.
A moot and academic case is one that ceases to present a justiciable controversy by
virtue of supervening events,[26] so that a declaration thereon would be of no practical use or
value.[27] Generally, courts decline jurisdiction over such case[28] or dismiss it on ground of
mootness.[29]
The Court holds that President Arroyos issuance of PP 1021 did not render the
present petitions moot and academic. During the eight (8) days that PP 1017 was operative,
the police officers, according to petitioners, committed illegal acts in implementing it. Are PP
1017 and G.O. No. 5 constitutional or valid? Do they justify these alleged illegal
acts? These are the vital issues that must be resolved in the present petitions. It must be
stressed that an unconstitutional act is not a law, it confers no rights, it imposes no
duties, it affords no protection; it is in legal contemplation, inoperative.[30]
The moot and academic principle is not a magical formula that can automatically
dissuade the courts in resolving a case. Courts will decide cases, otherwise moot and
academic, if: first, there is a grave violation of the Constitution;[31] second, the exceptional
character of the situation and the paramount public interest is involved; [32] third, when
constitutional issue raised requires formulation of controlling principles to guide the bench, the
bar, and the public;[33] and fourth, the case is capable of repetition yet evading review.[34]
All the foregoing exceptions are present here and justify this Courts assumption of
jurisdiction over the instant petitions. Petitioners alleged that the issuance of PP 1017 and G.O.
No. 5 violates the Constitution. There is no question that the issues being raised affect the
publics interest, involving as they do the peoples basic rights to freedom of expression, of
assembly and of the press. Moreover, the Court has the duty to formulate guiding and
controlling constitutional precepts, doctrines or rules. It has the symbolic function of educating
the bench and the bar, and in the present petitions, the military and the police, on the extent of
the protection given by constitutional guarantees.[35] And lastly, respondents contested actions
are capable of repetition. Certainly, the petitions are subject to judicial review.
In their attempt to prove the alleged mootness of this case, respondents cited Chief
Justice Artemio V. Panganibans Separate Opinion in Sanlakas v. Executive
[36]
Secretary. However, they failed to take into account the Chief Justices very statement that
an otherwise moot case may still be decided provided the party raising it in a proper case
has been and/or continues to be prejudiced or damaged as a direct result of its issuance. The citizen to interfere and see that a public offence be properly pursued and punished, and

present case falls right within this exception to the mootness rule pointed out by the Chief that a public grievance be remedied. With respect to taxpayers suits, Terr v.

Justice. Jordan[41] held that the right of a citizen and a taxpayer to maintain an action in courts to

restrain the unlawful use of public funds to his injury cannot be denied.

II- Legal Standing

However, to prevent just about any person from seeking judicial interference in any official

In view of the number of petitioners suing in various personalities, the Court deems it policy or act with which he disagreed with, and thus hinders the activities of governmental

imperative to have a more than passing discussion on legal standing or locus standi. agencies engaged in public service, the United State Supreme Court laid down the more

stringent direct injury test in Ex Parte Levitt,[42] later reaffirmed in Tileston v. Ullman.[43] The

Locus standi is defined as a right of appearance in a court of justice on a given same Court ruled that for a private individual to invoke the judicial power to determine the validity

question.[37] In private suits, standing is governed by the real-parties-in interest rule as of an executive or legislative action, he must show that he has sustained a direct injury as a

contained in Section 2, Rule 3 of the 1997 Rules of Civil Procedure, as amended. It provides that result of that action, and it is not sufficient that he has a general interest common to all

every action must be prosecuted or defended in the name of the real party in members of the public.

interest. Accordingly, the real-party-in interest is the party who stands to be benefited

or injured by the judgment in the suit or the party entitled to the avails of the This Court adopted the direct injury test in our jurisdiction. In People v.
[38] [44]
suit. Succinctly put, the plaintiffs standing is based on his own right to the relief sought. Vera, it held that the person who impugns the validity of a statute must have a personal

and substantial interest in the case such that he has sustained, or will sustain direct

The difficulty of determining locus standi arises in public suits. Here, the plaintiff who injury as a result. The Vera doctrine was upheld in a litany of cases, such as, Custodio v.

asserts a public right in assailing an allegedly illegal official action, does so as a President of the Senate,[45] Manila Race Horse Trainers Association v. De la

representative of the general public. He may be a person who is affected no differently from Fuente,[46] Pascual v. Secretary of Public Works[47] and Anti-Chinese League of the Philippines

any other person. He could be suing as a stranger, or in the category of a citizen, or v. Felix.[48]

taxpayer. In either case, he has to adequately show that he is entitled to seek judicial

protection. In other words, he has to make out a sufficient interest in the vindication of the However, being a mere procedural technicality, the requirement of locus standi may

public order and the securing of relief as a citizen or taxpayer. be waived by the Court in the exercise of its discretion. This was done in the 1949 Emergency

Powers Cases, Araneta v. Dinglasan,[49] where the transcendental importance of the

Case law in most jurisdictions now allows both citizen and taxpayer standing in cases prompted the Court to act liberally. Such liberality was neither a rarity nor

public actions. The distinction was first laid down in Beauchamp v. Silk,[39] where it was held accidental. In Aquino v. Comelec,[50] this Court resolved to pass upon the issues raised due to

that the plaintiff in a taxpayers suit is in a different category from the plaintiff in a citizens the far-reaching implications of the petition notwithstanding its categorical statement that

suit. In the former, the plaintiff is affected by the expenditure of public funds, while in the petitioner therein had no personality to file the suit. Indeed, there is a chain of cases where this

latter, he is but the mere instrument of the public concern. As held by the New York liberal policy has been observed, allowing ordinary citizens, members of Congress, and civic

Supreme Court in People ex rel Case v. Collins: [40]

In matter of mere public right, organizations to prosecute actions involving the constitutionality or validity of laws, regulations

howeverthe people are the real partiesIt is at least the right, if not the duty, of every and rulings.[51]
 Thus, the Court has adopted a rule that even where the petitioners have failed to show Significantly, recent decisions show a certain toughening in the Courts attitude

direct injury, they have been allowed to sue under the principle of transcendental toward legal standing.

importance. Pertinent are the following cases:

(1) Chavez v. Public Estates Authority,[52] where the Court ruled In Kilosbayan, Inc. v. Morato,[56] the Court ruled that the status of Kilosbayan as a
that the enforcement of the constitutional right to information and the
equitable diffusion of natural resources are matters of transcendental peoples organization does not give it the requisite personality to question the validity of the on-
importance which clothe the petitioner with locus standi;
line lottery contract, more so where it does not raise any issue of constitutionality. Moreover, it
[53]
(2) Bagong Alyansang Makabayan v. Zamora, wherein the cannot sue as a taxpayer absent any allegation that public funds are being misused. Nor can it
Court held that given the transcendental importance of the issues
involved, the Court may relax the standing requirements and allow the sue as a concerned citizen as it does not allege any specific injury it has suffered.
suit to prosper despite the lack of direct injury to the parties seeking
judicial review of the Visiting Forces Agreement;
In Telecommunications and Broadcast Attorneys of the Philippines, Inc. v. Comelec,[57] the
(3) Lim v. Executive Secretary,[54] while the Court noted that the
petitioners may not file suit in their capacity as taxpayers absent a showing Court reiterated the direct injury test with respect to concerned citizens cases involving
that Balikatan 02-01 involves the exercise of Congress taxing or constitutional issues. It held that there must be a showing that the citizen personally suffered
spending powers, it reiterated its ruling in Bagong Alyansang
Makabayan v. Zamora,[55] that in cases of transcendental importance, some actual or threatened injury arising from the alleged illegal official act.
the cases must be settled promptly and definitely and standing
requirements may be relaxed.

In Lacson v. Perez,[58] the Court ruled that one of the petitioners, Laban ng

Demokratikong Pilipino (LDP), is not a real party-in-interest as it had not demonstrated any injury
By way of summary, the following rules may be culled from the cases decided by this
to itself or to its leaders, members or supporters.
Court. Taxpayers, voters, concerned citizens, and legislators may be accorded standing to sue,

provided that the following requirements are met:

In Sanlakas v. Executive Secretary,[59] the Court ruled that only the petitioners who are

members of Congress have standing to sue, as they claim that the Presidents declaration of a
(1) the cases involve constitutional issues;
state of rebellion is a usurpation of the emergency powers of Congress, thus impairing

their legislative powers. As to petitioners Sanlakas, Partido Manggagawa, and Social Justice
(2) for taxpayers, there must be a claim of illegal disbursement of public
Society, the Court declared them to be devoid of standing, equating them with the LDP
funds or that the tax measure is unconstitutional;
in Lacson.

(3) for voters, there must be a showing of obvious interest in the validity of

the election law in question; Now, the application of the above principles to the present petitions.

(4) for concerned citizens, there must be a showing that the issues raised
The locus standi of petitioners in G.R. No. 171396, particularly David and Llamas, is
are of transcendental importance which must be settled early; and
beyond doubt. The same holds true with petitioners in G.R. No. 171409, Cacho-Olivares

and Tribune Publishing Co. Inc. They alleged direct injury resulting from illegal arrest and
(5) for legislators, there must be a claim that the official action
unlawful search committed by police operatives pursuant to PP 1017. Rightly so, the
complained of infringes upon their prerogatives as legislators.
Solicitor General does not question their legal standing.
 In G.R. No. 171485, the opposition Congressmen alleged there was usurpation of that her prerogatives as a lawmaker have been impaired by PP 1017 and G.O. No. 5. Her

legislative powers. They also raised the issue of whether or not the concurrence of Congress is claim that she is a media personality will not likewise aid her because there was no showing that

necessary whenever the alarming powers incident to Martial Law are used. Moreover, it is in the enforcement of these issuances prevented her from pursuing her occupation. Her

the interest of justice that those affected by PP 1017 can be represented by their Congressmen submission that she has pending electoral protest before the Presidential Electoral Tribunal is

in bringing to the attention of the Court the alleged violations of their basic rights. likewise of no relevance. She has not sufficiently shown that PP 1017 will affect the proceedings

or result of her case. But considering once more the transcendental importance of the issue

In G.R. No. 171400, (ALGI), this Court applied the liberality rule in Philconsa v. involved, this Court may relax the standing rules.
[60]
Enriquez, Kapatiran Ng Mga Naglilingkod sa Pamahalaan ng Pilipinas, Inc. v.
[61]
Tan, Association of Small Landowners in the Philippines, Inc. v. Secretary of Agrarian It must always be borne in mind that the question of locus standi is but corollary to the
[62] [63]
Reform, Basco v. Philippine Amusement and Gaming Corporation, and Taada v. bigger question of proper exercise of judicial power. This is the underlying legal tenet of the

Tuvera,[64] that when the issue concerns a public right, it is sufficient that the petitioner is a liberality doctrine on legal standing. It cannot be doubted that the validity of PP No. 1017

citizen and has an interest in the execution of the laws. and G.O. No. 5 is a judicial question which is of paramount importance to the Filipino

people. To paraphrase Justice Laurel, the whole of Philippine society now waits with bated

In G.R. No. 171483, KMUs assertion that PP 1017 and G.O. No. 5 violated its right breath the ruling of this Court on this very critical matter. The petitions thus call for the

to peaceful assembly may be deemed sufficient to give it legal standing. Organizations may be application of the transcendental importance doctrine, a relaxation of the standing

granted standing to assert the rights of their members. [65]

We take judicial notice of the requirements for the petitioners in the PP 1017 cases.

announcement by the Office of the President banning all rallies and canceling all permits for

public assemblies following the issuance of PP 1017 and G.O. No. 5. This Court holds that all the petitioners herein have locus standi.

In G.R. No. 171489, petitioners, Cadiz et al., who are national officers of the Incidentally, it is not proper to implead President Arroyo as respondent. Settled is the

Integrated Bar of the Philippines (IBP) have no legal standing, having failed to allege any direct doctrine that the President, during his tenure of office or actual incumbency, [67] may not be sued

or potential injury which the IBP as an institution or its members may suffer as a consequence of in any civil or criminal case, and there is no need to provide for it in the Constitution or law. It will

the issuance of PP No. 1017 and G.O. No. 5. In Integrated Bar of the Philippines v. degrade the dignity of the high office of the President, the Head of State, if he can be dragged

Zamora,[66] the Court held that the mere invocation by the IBP of its duty to preserve the rule of into court litigations while serving as such. Furthermore, it is important that he be freed from

law and nothing more, while undoubtedly true, is not sufficient to clothe it with standing in this any form of harassment, hindrance or distraction to enable him to fully attend to the performance

case. This is too general an interest which is shared by other groups and the whole of his official duties and functions. Unlike the legislative and judicial branch, only one constitutes

citizenry. However, in view of the transcendental importance of the issue, this Court declares the executive branch and anything which impairs his usefulness in the discharge of the many

that petitioner have locus standi. great and important duties imposed upon him by the Constitution necessarily impairs the

operation of the Government. However, this does not mean that the President is not

accountable to anyone. Like any other official, he remains accountable to the people[68] but he
In G.R. No. 171424, Loren Legarda has no personality as a taxpayer to file the instant
may be removed from office only in the mode provided by law and that is by impeachment.[69]
petition as there are no allegations of illegal disbursement of public funds. The fact that she is a

former Senator is of no consequence. She can no longer sue as a legislator on the allegation
B. SUBSTANTIVE The Integrated Bar of the Philippines v. Zamora[80] -- a recent case most pertinent to

these cases at bar -- echoed a principle similar to Lansang. While the Court considered the
I. Review of Factual Bases
Presidents calling-out power as a discretionary power solely vested in his wisdom, it

stressed that this does not prevent an examination of whether such power was exercised

within permissible constitutional limits or whether it was exercised in a manner

Petitioners maintain that PP 1017 has no factual basis. Hence, it was not
constituting grave abuse of discretion. This ruling is mainly a result of the Courts
necessary for President Arroyo to issue such Proclamation.
reliance on Section 1, Article VIII of 1987 Constitution which fortifies the authority of the courts to

determine in an appropriate action the validity of the acts of the political departments. Under
The issue of whether the Court may review the factual bases of the Presidents
the new definition of judicial power, the courts are authorized not only to settle actual
exercise of his Commander-in-Chief power has reached its distilled point - from the indulgent
controversies involving rights which are legally demandable and enforceable, but also to
days of Barcelon v. Baker[70] and Montenegro v. Castaneda[71] to the volatile era
determine whether or not there has been a grave abuse of discretion amounting to lack or
of Lansang v. Garcia,[72] Aquino, Jr. v. Enrile,[73] and Garcia-Padilla v. Enrile.[74] The tug-
excess of jurisdiction on the part of any branch or instrumentality of the
of-war always cuts across the line defining political questions, particularly those questions
government. The latter part of the authority represents a broadening of judicial power to
in regard to which full discretionary authority has been delegated to the legislative or executive
enable the courts of justice to review what was before a forbidden territory, to wit, the
branch of the government.[75] Barcelon and Montenegro were in unison in declaring that [81]
discretion of the political departments of the government. It speaks of judicial prerogative not
the authority to decide whether an exigency has arisen belongs to the President and his [82]
only in terms of power but also of duty.
decision is final and conclusive on the courts. Lansang took the opposite view. There, the

members of the Court were unanimous in the conviction that the Court has the authority to

inquire into the existence of factual bases in order to determine their constitutional As to how the Court may inquire into the Presidents exercise of

sufficiency. From the principle of separation of powers, it shifted the focus to the system power, Lansang adopted the test that judicial inquiry can go no further than to satisfy the

of checks and balances, under which the President is supreme, x x x Court not that the Presidents decision is correct, but that the President did not
only if and when he acts within the sphere allotted to him by the Basic Law,
act arbitrarily. Thus, the standard laid down is not correctness, but
and the authority to determine whether or not he has so acted is vested in
arbitrariness.[83] In Integrated Bar of the Philippines, this Court further ruled that it is
the Judicial Department, which in this respect, is, in turn,
incumbent upon the petitioner to show that the Presidents decision is totally bereft of
constitutionally supreme.[76] In 1973, the unanimous Court of Lansang was divided
factual basis and that if he fails, by way of proof, to support his assertion, then this Court
in Aquino v. Enrile.[77] There, the Court was almost evenly divided on the issue of

whether the validity of the imposition of Martial Law is a political or justiciable cannot undertake an independent investigation beyond the pleadings.

question.[78] Then came Garcia-Padilla v. Enrile which greatly diluted Lansang. It declared that

there is a need to re-examine the latter case, ratiocinating that in times of war or national
Petitioners failed to show that President Arroyos exercise of the calling-out power,
emergency, the President must be given absolute control for the very life of the nation
by issuing PP 1017, is totally bereft of factual basis. A reading of the Solicitor Generals
and the government is in great peril. The President, it intoned, is answerable only to his
Consolidated Comment and Memorandum shows a detailed narration of the events leading to
conscience, the People, and God.[79]
the issuance of PP 1017, with supporting reports forming part of the records. Mentioned are the

escape of the Magdalo Group, their audacious threat of the Magdalo D-Day, the defections in
the military, particularly in the Philippine Marines, and the reproving statements from the
communist leaders. There was also the Minutes of the Intelligence Report and Security Group of
the Philippine Army showing the growing alliance between the NPA and the military. Petitioners
presented nothing to refute such events. Thus, absent any contrary allegations, the Court is
convinced that the President was justified in issuing PP 1017 calling for military aid.
Indeed, judging the seriousness of the incidents, President Arroyo was not expected
to simply fold her arms and do nothing to prevent or suppress what she believed was lawless
violence, invasion or rebellion. However, the exercise of such power or duty must not stifle
liberty.
II. Constitutionality of PP 1017 and G.O. No. 5
Doctrines of Several Political Theorists
on the Power of the President
in Times of Emergency
This case brings to fore a contentious subject -- the power of the President in times of
emergency. A glimpse at the various political theories relating to this subject provides an
adequate backdrop for our ensuing discussion.
John Locke, describing the architecture of civil government, called upon the English
doctrine of prerogative to cope with the problem of emergency. In times of danger to the nation,
positive law enacted by the legislature might be inadequate or even a fatal obstacle to the
promptness of action necessary to avert catastrophe. In these situations, the Crown retained a
prerogative power to act according to discretion for the public good, without the
[84]
proscription of the law and sometimes even against it. But Locke recognized that this
moral restraint might not suffice to avoid abuse of prerogative powers. Who shall judge the
need for resorting to the prerogative and how may its abuse be avoided? Here, Locke
readily admitted defeat, suggesting that the people have no other remedy in this, as in all
other cases where they have no judge on earth, but to appeal to Heaven.[85]
Jean-Jacques Rousseau also assumed the need for temporary suspension of
democratic processes of government in time of emergency. According to him:
The inflexibility of the laws, which prevents them from adopting
themselves to circumstances, may, in certain cases, render them disastrous
and make them bring about, at a time of crisis, the ruin of the State
It is wrong therefore to wish to make political institutions as strong
as to render it impossible to suspend their operation. Even Sparta allowed
its law to lapse...
If the peril is of such a kind that the paraphernalia of the laws are
an obstacle to their preservation, the method is to nominate a supreme
lawyer, who shall silence all the laws and suspend for a moment the
sovereign authority. In such a case, there is no doubt about the general will,
and it clear that the peoples first intention is that the State shall not
perish.[86]
Rosseau did not fear the abuse of the emergency dictatorship or supreme
magistracy as he termed it. For him, it would more likely be cheapened by indiscreet
use. He was unwilling to rely upon an appeal to heaven. Instead, he relied upon a tenure
of office of prescribed duration to avoid perpetuation of the dictatorship.[87]
John Stuart Mill concluded his ardent defense of representative government: I am
far from condemning, in cases of extreme necessity, the assumption of absolute power in
the form of a temporary dictatorship.[88]
Nicollo Machiavellis view of emergency powers, as one element in the whole
scheme of limited government, furnished an ironic contrast to the Lockean theory of
prerogative. He recognized and attempted to bridge this chasm in democratic political
theory, thus:
Now, in a well-ordered society, it should never be necessary to
resort to extra constitutional measures; for although they may for a time be
beneficial, yet the precedent is pernicious, for if the practice is once
established for good objects, they will in a little while be disregarded under
that pretext but for evil purposes. Thus, no republic will ever be perfect if
she has not by law provided for everything, having a remedy for every
emergency and fixed rules for applying it.[89]

Machiavelli in contrast to Locke, Rosseau and Mill sought to incorporate into the
constitution a regularized system of standby emergency powers to be invoked with suitable
checks and controls in time of national danger. He attempted forthrightly to meet the problem of
combining a capacious reserve of power and speed and vigor in its application in time of
emergency, with effective constitutional restraints.[90]
Contemporary political theorists, addressing themselves to the problem of response to
emergency by constitutional democracies, have employed the doctrine of constitutional
dictatorship.[91] Frederick M. Watkins saw no reason why absolutism should not be used as
a means for the defense of liberal institutions, provided it serves to protect established
institutions from the danger of permanent injury in a period of temporary emergency and
is followed by a prompt return to the previous forms of political life.[92] He recognized
the two (2) key elements of the problem of emergency governance, as well as all constitutional
governance: increasing administrative powers of the executive, while at the same
time imposing limitation upon that power.[93] Watkins placed his real faith in a scheme of
constitutional dictatorship. These are the conditions of success of such a dictatorship: The
period of dictatorship must be relatively shortDictatorship should always be strictly
legitimate in characterFinal authority to determine the need for dictatorship in any given
case must never rest with the dictator himself[94] and the objective of such an emergency
dictatorship should be strict political conservatism.
Carl J. Friedrich cast his analysis in terms similar to those of Watkins. [95] It is a
problem of concentrating power in a government where power has consciously been divided
to cope with situations of unprecedented magnitude and gravity. There must be a broad grant
of powers, subject to equally strong limitations as to who shall exercise such powers, when, for
how long, and to what end.[96] Friedrich, too, offered criteria for judging the adequacy of any of
scheme of emergency powers, to wit: The emergency executive must be appointed by
constitutional means i.e., he must be legitimate; he should not enjoy power to
determine the existence of an emergency; emergency powers should be exercised under
a strict time limitation; and last, the objective of emergency action must be the defense of
the constitutional order.[97]
Clinton L. Rossiter, after surveying the history of the employment of emergency
powers in Great Britain, France, Weimar, Germany and the United States, reverted to a
description of a scheme of constitutional dictatorship as solution to the vexing problems
presented by emergency.[98] Like Watkins and Friedrich, he stated a priori the conditions of
success of the constitutional dictatorship, thus:
1) No general regime or particular institution of
constitutional dictatorship should be initiated unless it is
necessary or even indispensable to the preservation of the State
and its constitutional order
2) the decision to institute a constitutional
dictatorship should never be in the hands of the man or men who
will constitute the dictator
3) No government should initiate a constitutional
dictatorship without making specific provisions for its termination
4) all uses of emergency powers and all
readjustments in the organization of the government should be
effected in pursuit of constitutional or legal requirements
5) no dictatorial institution should be adopted, no
right invaded, no regular procedure altered any more than is
absolutely necessary for the conquest of the particular crisis . . .
6) The measures adopted in the prosecution of the a
constitutional dictatorship should never be permanent in character
or effect
7) The dictatorship should be carried on by persons
representative of every part of the citizenry interested in the
defense of the existing constitutional order. . .
8) Ultimate responsibility should be maintained for
every action taken under a constitutional dictatorship. . .
9) The decision to terminate a constitutional
dictatorship, like the decision to institute one should never be in
the hands of the man or men who constitute the dictator. . .
10) No constitutional dictatorship should extend beyond
the termination of the crisis for which it was instituted
11) the termination of the crisis must be followed by a
complete return as possible to the political and governmental
 conditions existing prior to the initiation of the constitutional
dictatorship[99] In the final analysis, the various approaches to emergency of the above political

theorists - from Locks theory of prerogative, to Watkins doctrine of constitutional

dictatorship and, eventually, to McIlwains principle of constitutionalism --- ultimately aim

Rossiter accorded to legislature a far greater role in the oversight exercise of emergency powers
to solve one real problem in emergency governance, i.e., that of allotting increasing areas of
than did Watkins. He would secure to Congress final responsibility for declaring the existence
discretionary power to the Chief Executive, while insuring that such powers will be
or termination of an emergency, and he places great faith in the effectiveness of congressional
exercised with a sense of political responsibility and under effective limitations and
investigating committees.[100]
checks.
Scott and Cotter, in analyzing the above contemporary theories in light of recent

experience, were one in saying that, the suggestion that democracies surrender the
Our Constitution has fairly coped with this problem. Fresh from the fetters of a
control of government to an authoritarian ruler in time of grave danger to the nation
repressive regime, the 1986 Constitutional Commission, in drafting the 1987 Constitution,
is not based upon sound constitutional theory. To appraise emergency power in terms of
endeavored to create a government in the concept of Justice Jacksons balanced power
constitutional dictatorship serves merely to distort the problem and hinder realistic analysis. It
structure.[102] Executive, legislative, and judicial powers are dispersed to the President, the
matters not whether the term dictator is used in its normal sense (as applied to authoritarian
Congress, and the Supreme Court, respectively. Each is supreme within its own sphere. But
rulers) or is employed to embrace all chief executives administering emergency powers.
none has the monopoly of power in times of emergency. Each branch is given a role to
However used, constitutional dictatorship cannot be divorced from the implication of
serve as limitation or check upon the other. This system does not weaken the
suspension of the processes of constitutionalism. Thus, they favored instead the concept of
President, it just limits his power, using the language of McIlwain. In other words, in times of
constitutionalism articulated by Charles H. McIlwain:
emergency, our Constitution reasonably demands that we repose a certain amount of faith in the
A concept of constitutionalism which is less misleading in the basic integrity and wisdom of the Chief Executive but, at the same time, it obliges him to
analysis of problems of emergency powers, and which is consistent with the
findings of this study, is that formulated by Charles H. McIlwain. While it operate within carefully prescribed procedural limitations.
does not by any means necessarily exclude some indeterminate limitations
upon the substantive powers of government, full emphasis is placed
upon procedural limitations, and political responsibility. McIlwain clearly
recognized the need to repose adequate power in government. And in a. Facial Challenge
discussing the meaning of constitutionalism, he insisted that the historical
and proper test of constitutionalism was the existence of adequate
processes for keeping government responsible. He refused to equate Petitioners contend that PP 1017 is void on its face because of its overbreadth.
constitutionalism with the enfeebling of government by an exaggerated
emphasis upon separation of powers and substantive limitations on They claim that its enforcement encroached on both unprotected and protected rights under
governmental power. He found that the really effective checks on despotism
have consisted not in the weakening of government but, but rather in Section 4, Article III of the Constitution and sent a chilling effect to the citizens.
the limiting of it; between which there is a great and very significant
difference. In associating constitutionalism with limited as
distinguished from weak government, McIlwain meant government A facial review of PP 1017, using the overbreadth doctrine, is uncalled for.
limited to the orderly procedure of law as opposed to the processes of
force. The two fundamental correlative elements of constitutionalism
for which all lovers of liberty must yet fight are the legal limits to
First and foremost, the overbreadth doctrine is an analytical tool developed for
arbitrary power and a complete political responsibility of government
to the governed.[101] testing on their faces statutes in free speech cases, also known under the American Law as

First Amendment cases.[103]

 A plain reading of PP 1017 shows that it is not primarily directed to speech or even
speech-related conduct. It is actually a call upon the AFP to prevent or suppress all forms
of lawless violence. In United States v. Salerno,[104] the US Supreme Court held that we
have not recognized an overbreadth doctrine outside the limited context of the First
Amendment (freedom of speech).
Moreover, the overbreadth doctrine is not intended for testing the validity of a law that
reflects legitimate state interest in maintaining comprehensive control over harmful,
constitutionally unprotected conduct. Undoubtedly, lawless violence, insurrection and rebellion
are considered harmful and constitutionally unprotected conduct. In Broadrick v.
Oklahoma,[105] it was held:
It remains a matter of no little difficulty to determine when a
law may properly be held void on its face and when such summary
action is inappropriate. But the plain import of our cases is, at the very
least, that facial overbreadth adjudication is an exception to our
traditional rules of practice and that its function, a limited one at the
outset, attenuates as the otherwise unprotected behavior that it
forbids the State to sanction moves from pure speech toward
conduct and that conduct even if expressive falls within the scope
of otherwise valid criminal laws that reflect legitimate state interests in
maintaining comprehensive controls over harmful, constitutionally
unprotected conduct.
Thus, claims of facial overbreadth are entertained in cases involving statutes which, by
their terms, seek to regulate only spoken words and again, that overbreadth claims, if
entertained at all, have been curtailed when invoked against ordinary criminal laws that
are sought to be applied to protected conduct.[106] Here, the incontrovertible fact remains
that PP 1017 pertains to a spectrum of conduct, not free speech, which is manifestly subject to
state regulation.
Second, facial invalidation of laws is considered as manifestly strong medicine, to be
used sparingly and only as a last resort, and is generally disfavored;[107] The reason
for this is obvious. Embedded in the traditional rules governing constitutional adjudication is the
principle that a person to whom a law may be applied will not be heard to challenge a law on the
ground that it may conceivably be applied unconstitutionally to others, i.e., in other situations
not before the Court.[108] A writer and scholar in Constitutional Law explains further:
The most distinctive feature of the overbreadth technique is
that it marks an exception to some of the usual rules of constitutional
litigation. Ordinarily, a particular litigant claims that a statute is
unconstitutional as applied to him or her; if the litigant prevails, the
courts carve away the unconstitutional aspects of the law by
invalidating its improper applications on a case to case
basis. Moreover, challengers to a law are not permitted to raise the
rights of third parties and can only assert their own interests. In
overbreadth analysis, those rules give way; challenges are permitted
to raise the rights of third parties; and the court invalidates the entire
statute on its face, not merely as applied for so that the overbroad
law becomes unenforceable until a properly authorized court construes it
more narrowly. The factor that motivates courts to depart from the normal
adjudicatory rules is the concern with the chilling; deterrent effect of the
overbroad statute on third parties not courageous enough to bring suit. The
Court assumes that an overbroad laws very existence may cause others
not before the court to refrain from constitutionally protected speech or
expression. An overbreadth ruling is designed to remove that deterrent
effect on the speech of those third parties.
In other words, a facial challenge using the overbreadth doctrine will require the Court
to examine PP 1017 and pinpoint its flaws and defects, not on the basis of its actual operation to
petitioners, but on the assumption or prediction that its very existence may cause others not
before the Court to refrain from constitutionally protected speech or expression. In Younger v.
Harris,[109] it was held that:
[T]he task of analyzing a proposed statute, pinpointing its
deficiencies, and requiring correction of these deficiencies before the statute
is put into effect, is rarely if ever an appropriate task for the judiciary. The
combination of the relative remoteness of the controversy, the impact
on the legislative process of the relief sought, and above all the
speculative and amorphous nature of the required line-by-line analysis
of detailed statutes,...ordinarily results in a kind of case that is wholly
unsatisfactory for deciding constitutional questions, whichever way they
might be decided.
And third, a facial challenge on the ground of overbreadth is the most difficult
challenge to mount successfully, since the challenger must establish that there can be no
instance when the assailed law may be valid. Here, petitioners did not even attempt to show
whether this situation exists.
Petitioners likewise seek a facial review of PP 1017 on the ground of
vagueness. This, too, is unwarranted.
 Related to the overbreadth doctrine is the void for vagueness doctrine which
holds that a law is facially invalid if men of common intelligence must necessarily guess
at its meaning and differ as to its application.[110] It is subject to the same principles
governing overbreadth doctrine. For one, it is also an analytical tool for testing on their
faces statutes in free speech cases. And like overbreadth, it is said that a litigant may
challenge a statute on its face only if it is vague in all its possible applications. Again,
petitioners did not even attempt to show that PP 1017 is vague in all its application. They
First Provision: Calling-out Power
also failed to establish that men of common intelligence cannot understand the meaning and
application of PP 1017.
Sanlakas v. Executive Secretary,[111] this Court, through Mr. Justice Dante O. Tinga, held that
Section 18, Article VII of the Constitution reproduced as follows:
b. Constitutional Basis of PP 1017
Now on the constitutional foundation of PP 1017.
The operative portion of PP 1017 may be divided into three important provisions, thus:
First provision:
by virtue of the power vested upon me by Section 18, Artilce VII
do hereby command the Armed Forces of the Philippines, to maintain law
and order throughout the Philippines, prevent or suppress all forms of
lawless violence as well any act of insurrection or rebellion
Second provision:
and to enforce obedience to all the laws and to all decrees,
orders and regulations promulgated by me personally or upon my
direction;
Third provision:
as provided in Section 17, Article XII of the Constitution do
hereby declare a State of National Emergency.
The first provision pertains to the Presidents calling-out power. In
Sec. 18. The President shall be the Commander-in-Chief of all
armed forces of the Philippines and whenever it becomes necessary, he
may call out such armed forces to prevent or suppress lawless
violence, invasion or rebellion. In case of invasion or rebellion, when the
public safety requires it, he may, for a period not exceeding sixty days,
suspend the privilege of the writ of habeas corpus or place the Philippines
or any part thereof under martial law. Within forty-eight hours from the
proclamation of martial law or the suspension of the privilege of the writ
of habeas corpus, the President shall submit a report in person or in writing
to the Congress. The Congress, voting jointly, by a vote of at least a
majority of all its Members in regular or special session, may revoke such
proclamation or suspension, which revocation shall not be set aside by the
President. Upon the initiative of the President, the Congress may, in the
same manner, extend such proclamation or suspension for a period to be
determined by the Congress, if the invasion or rebellion shall persist and
public safety requires it.
The Congress, if not in session, shall within twenty-four hours following
such proclamation or suspension, convene in accordance with its rules
without need of a call.
The Supreme Court may review, in an appropriate proceeding filed
by any citizen, the sufficiency of the factual bases of the proclamation of
martial law or the suspension of the privilege of the writ or the extension
thereof, and must promulgate its decision thereon within thirty days from its
filing.
A state of martial law does not suspend the operation of the
Constitution, nor supplant the functioning of the civil courts or legislative
assemblies, nor authorize the conferment of jurisdiction on military courts
and agencies over civilians where civil courts are able to function, nor
automatically suspend the privilege of the writ.
The suspension of the privilege of the writ shall apply only to persons
judicially charged for rebellion or offenses inherent in or directly connected
with invasion.
 During the suspension of the privilege of the writ, any person thus
arrested or detained shall be judicially charged within three days, otherwise
he shall be released.
grants the President, as Commander-in-Chief, a sequence of graduated powers. From the
most to the least benign, these are: the calling-out power, the power to suspend the privilege of
the writ of habeas corpus, and the power to declare Martial Law. Citing Integrated Bar of the
[112]
Philippines v. Zamora, the Court ruled that the only criterion for the exercise of the calling-out
power is that whenever it becomes necessary, the President may call the armed forces
to prevent or suppress lawless violence, invasion or rebellion. Are these conditions
present in the instant cases? As stated earlier, considering the circumstances then prevailing,
President Arroyo found it necessary to issue PP 1017. Owing to her Offices vast intelligence
network, she is in the best position to determine the actual condition of the country.
Under the calling-out power, the President may summon the armed forces to aid him in
suppressing lawless violence, invasion and rebellion. This involves ordinary police
action. But every act that goes beyond the Presidents calling-out power is considered illegal
or ultra vires. For this reason, a President must be careful in the exercise of his powers. He
cannot invoke a greater power when he wishes to act under a lesser power. There lies the
wisdom of our Constitution, the greater the power, the greater are the limitations.
It is pertinent to state, however, that there is a distinction between the Presidents
authority to declare a state of rebellion (in Sanlakas) and the authority to proclaim a state of
national emergency. While President Arroyos authority to declare a state of rebellion
emanates from her powers as Chief Executive, the statutory authority cited in Sanlakas was
Section 4, Chapter 2, Book II of the Revised Administrative Code of 1987, which provides:
SEC. 4. Proclamations. Acts of the President fixing a
date or declaring a status or condition of public moment or
interest, upon the existence of which the operation of a specific
law or regulation is made to depend, shall be promulgated in
proclamations which shall have the force of an executive order.
President Arroyos declaration of a state of rebellion was merely an act declaring a
status or condition of public moment or interest, a declaration allowed under Section 4 cited
above. Such declaration, in the words of Sanlakas, is harmless, without legal significance, and
deemed not written. In these cases, PP 1017 is more than that. In declaring a state of national
emergency, President Arroyo did not only rely on Section 18, Article VII of the Constitution, a
provision calling on the AFP to prevent or suppress lawless violence, invasion or rebellion. She
also relied on Section 17, Article XII, a provision on the States extraordinary power to take over
privately-owned public utility and business affected with public interest. Indeed, PP 1017 calls
for the exercise of an awesome power. Obviously, such Proclamation cannot be deemed
harmless, without legal significance, or not written, as in the case of Sanlakas.
Some of the petitioners vehemently maintain that PP 1017 is actually a declaration of
Martial Law. It is no so. What defines the character of PP 1017 are its wordings. It is plain
therein that what the President invoked was her calling-out power.
The declaration of Martial Law is a warn[ing] to citizens that the military power has been
called upon by the executive to assist in the maintenance of law and order, and that, while the
emergency lasts, they must, upon pain of arrest and punishment, not commit any acts which will
in any way render more difficult the restoration of order and the enforcement of law.[113]
In his Statement before the Senate Committee on Justice on March 13, 2006, Mr.
Justice Vicente V. Mendoza,[114] an authority in constitutional law, said that of the three powers of
the President as Commander-in-Chief, the power to declare Martial Law poses the most severe
threat to civil liberties. It is a strong medicine which should not be resorted to lightly. It cannot
be used to stifle or persecute critics of the government. It is placed in the keeping of the
President for the purpose of enabling him to secure the people from harm and to restore order
so that they can enjoy their individual freedoms. In fact, Section 18, Art. VII, provides:
A state of martial law does not suspend the operation of the
Constitution, nor supplant the functioning of the civil courts or legislative
assemblies, nor authorize the conferment of jurisdiction on military courts
and agencies over civilians where civil courts are able to function, nor
automatically suspend the privilege of the writ.
Justice Mendoza also stated that PP 1017 is not a declaration of Martial Law. It is no
more than a call by the President to the armed forces to prevent or suppress lawless
violence. As such, it cannot be used to justify acts that only under a valid declaration of Martial
Law can be done. Its use for any other purpose is a perversion of its nature and scope, and any
act done contrary to its command is ultra vires.
Justice Mendoza further stated that specifically, (a) arrests and seizures without judicial
warrants; (b) ban on public assemblies; (c) take-over of news media and agencies and press
censorship; and (d) issuance of Presidential Decrees, are powers which can be exercised by the
President as Commander-in-Chief only where there is a valid declaration of Martial Law or
suspension of the writ of habeas corpus.
Based on the above disquisition, it is clear that PP 1017 is not a declaration of Martial
Law. It is merely an exercise of President Arroyos calling-out power for the armed forces
to assist her in preventing or suppressing lawless violence.
Second Provision: Take Care Power
The second provision pertains to the power of the President to ensure that the laws be
faithfully executed. This is based on Section 17, Article VII which reads:
SEC. 17. The President shall have control of all the executive
departments, bureaus, and offices. He shall ensure that the laws be
faithfully executed.
As the Executive in whom the executive power is vested, [115] the primary function of
the President is to enforce the laws as well as to formulate policies to be embodied in existing
laws. He sees to it that all laws are enforced by the officials and employees of his
department. Before assuming office, he is required to take an oath or affirmation to the effect
that as President of the Philippines, he will, among others, execute its laws. [116] In the
exercise of such function, the President, if needed, may employ the powers attached to his office
as the Commander-in-Chief of all the armed forces of the country,[117] including the Philippine
[118] [119]
National Police under the Department of Interior and Local Government.
Petitioners, especially Representatives Francis Joseph G. Escudero, Satur Ocampo,
Rafael Mariano, Teodoro Casio, Liza Maza, and Josel Virador argue that PP 1017 is
unconstitutional as it arrogated upon President Arroyo the power to enact laws and decrees in
violation of Section 1, Article VI of the Constitution, which vests the power to enact laws in
Congress. They assail the clause to enforce obedience to all the laws and to all decrees,
orders and regulations promulgated by me personally or upon my direction.
\
Petitioners contention is understandable. A reading of PP 1017 operative clause
shows that it was lifted[120] from Former President Marcos Proclamation No. 1081, which partly
reads:
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of
the Philippines by virtue of the powers vested upon me by Article VII,
Section 10, Paragraph (2) of the Constitution, do hereby place the entire
Philippines as defined in Article 1, Section 1 of the Constitution under
martial law and, in my capacity as their Commander-in-Chief, do hereby
command the Armed Forces of the Philippines, to maintain law and
order throughout the Philippines, prevent or suppress all forms of
lawless violence as well as any act of insurrection or rebellion and to
enforce obedience to all the laws and decrees, orders and regulations
promulgated by me personally or upon my direction.
We all know that it was PP 1081 which granted President Marcos legislative
power. Its enabling clause states: to enforce obedience to all the laws and decrees,
orders and regulations promulgated by me personally or upon my direction. Upon the
other hand, the enabling clause of PP 1017 issued by President Arroyo is: to enforce
obedience to all the laws and to all decrees, orders and regulations promulgated by me
personally or upon my direction.
Is it within the domain of President Arroyo to promulgate decrees?
PP 1017 states in part: to enforce obedience to all the laws and decrees x x
x promulgated by me personally or upon my direction.
 The President is granted an Ordinance Power under Chapter 2, Book III of Executive

Order No. 292 (Administrative Code of 1987). She may issue any of the following: Can President Arroyo enforce obedience to all decrees and laws through the military?

Sec. 2. Executive Orders. Acts of the President providing for

As this Court stated earlier, President Arroyo has no authority to enact decrees. It follows
rules of a general or permanent character in implementation or execution of
constitutional or statutory powers shall be promulgated in executive orders. that these decrees are void and, therefore, cannot be enforced. With respect to laws, she
Sec. 3. Administrative Orders. Acts of the President which cannot call the military to enforce or implement certain laws, such as customs laws, laws
relate to particular aspect of governmental operations in pursuance of his
duties as administrative head shall be promulgated in administrative orders. governing family and property relations, laws on obligations and contracts and the like. She can
Sec. 4. Proclamations. Acts of the President fixing a date or only order the military, under PP 1017, to enforce laws pertinent to its duty to suppress lawless
declaring a status or condition of public moment or interest, upon the
existence of which the operation of a specific law or regulation is made to violence.
depend, shall be promulgated in proclamations which shall have the force of
an executive order.
Sec. 5. Memorandum Orders. Acts of the President on matters
of administrative detail or of subordinate or temporary interest which only
concern a particular officer or office of the Government shall be embodied in
memorandum orders.
Sec. 6. Memorandum Circulars. Acts of the President on
matters relating to internal administration, which the President desires to Third Provision: Power to Take Over
bring to the attention of all or some of the departments, agencies, bureaus
or offices of the Government, for information or compliance, shall be
embodied in memorandum circulars.
The pertinent provision of PP 1017 states:
Sec. 7. General or Special Orders. Acts and commands of the
President in his capacity as Commander-in-Chief of the Armed Forces of
the Philippines shall be issued as general or special orders. x x x and to enforce obedience to all the laws
and to all decrees, orders, and regulations promulgated
by me personally or upon my direction; and as
provided in Section 17, Article XII of the
President Arroyos ordinance power is limited to the foregoing issuances. She Constitution do hereby declare a state of national
emergency.
cannot issue decrees similar to those issued by Former President Marcos under PP

1081. Presidential Decrees are laws which are of the same category and binding force as

statutes because they were issued by the President in the exercise of his legislative power The import of this provision is that President Arroyo, during the state of national

during the period of Martial Law under the 1973 Constitution.[121] emergency under PP 1017, can call the military not only to enforce obedience to all the laws

and to all decrees x x x but also to act pursuant to the provision of Section 17, Article XII which

This Court rules that the assailed PP 1017 is unconstitutional insofar as it reads:

grants President Arroyo the authority to promulgate decrees. Legislative power is Sec. 17. In times of national emergency, when the public interest so
requires, the State may, during the emergency and under reasonable terms
peculiarly within the province of the Legislature. Section 1, Article VI categorically states that prescribed by it, temporarily take over or direct the operation of any
[t]he legislative power shall be vested in the Congress of the Philippines which shall privately-owned public utility or business affected with public interest.

consist of a Senate and a House of Representatives. To be sure, neither Martial Law nor a

state of rebellion nor a state of emergency can justify President Arroyos exercise of legislative

power by issuing decrees.


What could be the reason of President Arroyo in invoking the above provision when
she issued PP 1017?
The answer is simple. During the existence of the state of national emergency, PP
(2) In times of war or other national emergency, the Congress
may, by law, authorize the President, for a limited period and subject to
such restrictions as it may prescribe, to exercise powers necessary and
proper to carry out a declared national policy. Unless sooner withdrawn by
resolution of the Congress, such powers shall cease upon the next
adjournment thereof.

1017 purports to grant the President, without any authority or delegation from Congress, to take
It may be pointed out that the second paragraph of the above provision refers not only to
over or direct the operation of any privately-owned public utility or business affected with public
war but also to other national emergency. If the intention of the Framers of our
interest.
Constitution was to withhold from the President the authority to declare a state of national

emergency pursuant to Section 18, Article VII (calling-out power) and grant it to Congress (like
This provision was first introduced in the 1973 Constitution, as a product of the
the declaration of the existence of a state of war), then the Framers could have provided
martial law thinking of the 1971 Constitutional Convention.[122] In effect at the time of its
so. Clearly, they did not intend that Congress should first authorize the President before he can
approval was President Marcos Letter of Instruction No. 2 dated September 22, 1972
declare a state of national emergency. The logical conclusion then is that President Arroyo
instructing the Secretary of National Defense to take over the management, control and
could validly declare the existence of a state of national emergency even in the absence of a
operation of the Manila Electric Company, the Philippine Long Distance Telephone Company,
Congressional enactment.
the National Waterworks and Sewerage Authority, the Philippine National Railways, the

Philippine Air Lines, Air Manila (and) Filipinas Orient Airways . . . for the successful prosecution
But the exercise of emergency powers, such as the taking over of privately owned
by the Government of its effort to contain, solve and end the present national emergency.
public utility or business affected with public interest, is a

different matter. This requires a delegation from Congress.

Petitioners, particularly the members of the House of Representatives, claim that President

Arroyos inclusion of Section 17, Article XII in PP 1017 is an encroachment on the legislatures
Courts have often said that constitutional provisions in pari materia are to be
emergency powers.
construed together. Otherwise stated, different clauses, sections, and provisions of a

constitution which relate to the same subject matter will be construed together and considered in
This is an area that needs delineation.
the light of each other.[123] Considering that Section 17 of Article XII and Section 23 of Article VI,

previously quoted, relate to national emergencies, they must be read together to determine the
A distinction must be drawn between the Presidents authority to declare a state of
limitation of the exercise of emergency powers.
national emergency and to exercise emergency powers. To the first, as elucidated by

the Court, Section 18, Article VII grants the President such power, hence, no legitimate
Generally, Congress is the repository of emergency powers. This is evident in
constitutional objection can be raised. But to the second, manifold constitutional issues arise.
the tenor of Section 23 (2), Article VI authorizing it to delegate such powers to the

President. Certainly, a body cannot delegate a power not reposed upon it. However,
Section 23, Article VI of the Constitution reads: knowing that during grave emergencies, it may not be possible or practicable for Congress to

meet and exercise its powers, the Framers of our Constitution deemed it wise to allow Congress
SEC. 23. (1) The Congress, by a vote of two-thirds of both
Houses in joint session assembled, voting separately, shall have the sole to grant emergency powers to the President, subject to certain conditions, thus:
power to declare the existence of a state of war.
 (1) There must be a war or other emergency. silent nor equivocal about who shall make laws which the President is
to execute. The first section of the first article says that All
(2) The delegation must be for a limited period only. legislative Powers herein granted shall be vested in a Congress of the
United States. . .[126]
(3) The delegation must be subject to such restrictions as the
Congress may prescribe.
(4) The emergency powers must be exercised to carry out a
national policy declared by Congress.[124]
Petitioner Cacho-Olivares, et al. contends that the term emergency under Section

17, Article XII refers to tsunami, typhoon, hurricane and similar

occurrences. This is a limited view of emergency.

Section 17, Article XII must be understood as an aspect of the emergency powers

clause. The taking over of private business affected with public interest is just another facet of

the emergency powers generally reposed upon Congress. Thus, when Section 17 states that

the the State may, during the emergency and under reasonable terms prescribed by it,
Emergency, as a generic term, connotes the existence of conditions suddenly
temporarily take over or direct the operation of any privately owned public utility or
intensifying the degree of existing danger to life or well-being beyond that which is accepted as
business affected with public interest, it refers to Congress, not the President. Now,
normal. Implicit in this definitions are the elements of intensity, variety, and
whether or not the President may exercise such power is dependent on whether Congress may
[127]
perception. Emergencies, as perceived by legislature or executive in the United Sates since
delegate it to him pursuant to a law prescribing the reasonable terms thereof. Youngstown
1933, have been occasioned by a wide range of situations, classifiable under three (3) principal
Sheet & Tube Co. et al. v. Sawyer,[125] held:
heads: a) economic,[128] b) natural disaster,[129] and c) national security.[130]
It is clear that if the President had authority to issue the order he
did, it must be found in some provision of the Constitution. And it is not
claimed that express constitutional language grants this power to the
President. The contention is that presidential power should be implied from
the aggregate of his powers under the Constitution. Particular reliance is
placed on provisions in Article II which say that The executive Power shall Emergency, as contemplated in our Constitution, is of the same breadth. It may
be vested in a President . . . .; that he shall take Care that the Laws be
faithfully executed; and that he shall be Commander-in-Chief of the include rebellion, economic crisis, pestilence or epidemic, typhoon, flood, or other similar
Army and Navy of the United States.
catastrophe of nationwide proportions or effect.[131] This is evident in the Records of the
The order cannot properly be sustained as an exercise of the
Presidents military power as Commander-in-Chief of the Armed Constitutional Commission, thus:
Forces. The Government attempts to do so by citing a number of cases
upholding broad powers in military commanders engaged in day-to-day MR. GASCON. Yes. What is the Committees definition of national
fighting in a theater of war. Such cases need not concern us here. Even emergency which appears in Section 13, page 5? It reads:
though theater of war be an expanding concept, we cannot with
faithfulness to our constitutional system hold that the Commander-in- When the common good so requires, the State may temporarily take
Chief of the Armed Forces has the ultimate power as such to take over or direct the operation of any privately owned public utility or business
possession of private property in order to keep labor disputes from affected with public interest.
stopping production. This is a job for the nations lawmakers, not for
its military authorities. MR. VILLEGAS. What I mean is threat from external aggression, for
example, calamities or natural disasters.
Nor can the seizure order be sustained because of the
several constitutional provisions that grant executive power to the MR. GASCON. There is a question by Commissioner de los
President. In the framework of our Constitution, the Presidents Reyes. What about strikes and riots?
power to see that the laws are faithfully executed refutes the idea that
he is to be a lawmaker. The Constitution limits his functions in the
lawmaking process to the recommending of laws he thinks wise and MR. VILLEGAS. Strikes, no; those would not be covered by the term
national emergency.
the vetoing of laws he thinks bad. And the Constitution is neither
 MR. BENGZON. Unless they are of such proportions such that they
would paralyze government service.[132]
Following our interpretation of Section 17, Article XII, invoked by President Arroyo in
x x x x x x
issuing PP 1017, this Court rules that such Proclamation does not authorize her during the
MR. TINGSON. May I ask the committee if national emergency
emergency to temporarily take over or direct the operation of any privately owned public utility or
refers to military national emergency or could this be economic
emergency? business affected with public interest without authority from Congress.

MR. VILLEGAS. Yes, it could refer to both military or economic

dislocations.
Let it be emphasized that while the President alone can declare a state of national
[133]
MR. TINGSON. Thank you very much. emergency, however, without legislation, he has no power to take over privately-owned public

utility or business affected with public interest. The President cannot decide whether

exceptional circumstances exist warranting the take over of privately-owned public

It may be argued that when there is national emergency, Congress may not be able to utility or business affected with public interest. Nor can he determine when such exceptional
convene and, therefore, unable to delegate to the President the power to take over privately- circumstances have ceased. Likewise, without legislation, the President has no power to point
owned public utility or business affected with public interest. out the types of businesses affected with public interest that should be taken over. In short, the

President has no absolute authority to exercise all the powers of the State under Section 17,
In Araneta v. Dinglasan,[134] this Court emphasized that legislative power, through which Article VII in the absence of an emergency powers act passed by Congress.
extraordinary measures are exercised, remains in Congress even in times of crisis.

x x x c. AS APPLIED CHALLENGE

After all the criticisms that have been made against the One of the misfortunes of an emergency, particularly, that which pertains to security, is
efficiency of the system of the separation of powers, the fact
remains that the Constitution has set up this form of government, that military necessity and the guaranteed rights of the individual are often not compatible. Our
with all its defects and shortcomings, in preference to the
commingling of powers in one man or group of men. The Filipino history reveals that in the crucible of conflict, many rights are curtailed and trampled upon. Here,
people by adopting parliamentary government have given notice
that they share the faith of other democracy-loving peoples in this the right against unreasonable search and seizure; the right against warrantless
system, with all its faults, as the ideal. The point is, under this
arrest; and the freedom of speech, of expression, of the press, and of assembly under the
framework of government, legislation is preserved for Congress
all the time, not excepting periods of crisis no matter how Bill of Rights suffered the greatest blow.
serious. Never in the history of the United States, the basic
features of whose Constitution have been copied in ours, have
specific functions of the legislative branch of enacting laws been
surrendered to another department unless we regard as Of the seven (7) petitions, three (3) indicate direct injury.
legislating the carrying out of a legislative policy according to
prescribed standards; no, not even when that Republic was
fighting a total war, or when it was engaged in a life-and-death In G.R. No. 171396, petitioners David and Llamas alleged that, on February 24, 2006,
struggle to preserve the Union. The truth is that under our concept
of constitutional government, in times of extreme perils more than they were arrested without warrants on their way to EDSA to celebrate the 20thAnniversary
in normal circumstances the various branches, executive,
legislative, and judicial, given the ability to act, are called upon of People Power I. The arresting officers cited PP 1017 as basis of the arrest.
to perform the duties and discharge the responsibilities
committed to them respectively.
 In G.R. No. 171409, petitioners Cacho-Olivares and Tribune Publishing Co., Inc. implementing them have acted arbitrarily. If this were so, judging from the blunders committed

claimed that on February 25, 2006, the CIDG operatives raided and ransacked without by policemen in the cases passed upon by the Court, majority of the provisions of the Revised

warrant their office. Three policemen were assigned to guard their office as a possible Penal Code would have been declared unconstitutional a long time ago.

source of destabilization. Again, the basis was PP 1017.

President Arroyo issued G.O. No. 5 to carry into effect the provisions of PP
And in G.R. No. 171483, petitioners KMU and NAFLU-KMU et al. alleged that their
1017. General orders are acts and commands of the President in his capacity as Commander-
members were turned away and dispersed when they went to EDSA and later, to Ayala
in-Chief of the Armed Forces of the Philippines. They are internal rules issued by the executive
Avenue, to celebrate the 20th Anniversary of People Power I.
officer to his subordinates precisely for the proper and efficientadministration of law. Such

rules and regulations create no relation except between the official who issues them and the
A perusal of the direct injuries allegedly suffered by the said petitioners shows that
official who receives them.[139] They are based on and are the product of, a relationship in which
they resulted from the implementation, pursuant to G.O. No. 5, of PP 1017.
power is their source, and obedience, their object.[140] For these reasons, one requirement for

these rules to be valid is that they must be reasonable, not arbitrary or capricious.
Can this Court adjudge as unconstitutional PP 1017 and G.O. No 5 on the basis of

these illegal acts? In general, does the illegal implementation of a law render it unconstitutional?
G.O. No. 5 mandates the AFP and the PNP to immediately carry out the necessary

and appropriate actions and measures to suppress and prevent acts of terrorism and
Settled is the rule that courts are not at liberty to declare statutes invalid although
lawless violence.
they may be abused and misabused[135] and may afford an opportunity for abuse in the

manner of application.[136] The validity of a statute or ordinance is to be determined from its

Unlike the term lawless violence which is unarguably extant in our statutes and the
general purpose and its efficiency to accomplish the end desired, not from its effects in a
Constitution, and which is invariably associated with invasion, insurrection or rebellion, the
particular case.[137] PP 1017 is merely an invocation of the Presidents calling-out power. Its
phrase acts of terrorism is still an amorphous and vague concept. Congress has yet to enact
general purpose is to command the AFP to suppress all forms of lawless violence, invasion or
a law defining and punishing acts of terrorism.
rebellion. It had accomplished the end desired which prompted President Arroyo to issue PP

1021. But there is nothing in PP 1017 allowing the police, expressly or impliedly, to conduct

illegal arrest, search or violate the citizens constitutional rights.

In fact, this definitional predicament or the absence of an agreed definition of

terrorism confronts not only our country, but the international

community as well. The following observations are quite apropos:

Now, may this Court adjudge a law or ordinance unconstitutional on the ground that its
implementor committed illegal acts? The answer is no. The criterion by which the validity of the
statute or ordinance is to be measured is the essential basis for the exercise of power, and not
a mere incidental result arising from its exertion.[138] This is logical. Just imagine the
absurdity of situations when laws maybe declared unconstitutional just because the officers
In the actual unipolar context of international relations, the fight
against terrorism has become one of the basic slogans when it comes to
the justification of the use of force against certain states and against groups
operating internationally. Lists of states sponsoring terrorism and of
terrorist organizations are set up and constantly being updated according to
criteria that are not always known to the public, but are clearly determined
by strategic interests.
 The basic problem underlying all these military actions or
threats of the use of force as the most recent by the United States against
Iraq consists in the absence of an agreed definition of terrorism.
Remarkable confusion persists in regard to the legal
categorization of acts of violence either by states, by armed groups such as
liberation movements, or by individuals.
The United Nations Organization has been unable to reach a
decision on the definition of terrorism exactly because of these conflicting
interests of sovereign states that determine in each and every instance how
a particular armed movement (i.e. a non-state actor) is labeled in regard to
the terrorists-freedom fighter dichotomy. A policy of double standards
on this vital issue of international affairs has been the unavoidable
consequence.

The dilemma can by summarized in the saying One countrys
terrorist is another countrys freedom fighter. The apparent contradiction
or lack of consistency in the use of the term terrorism may further be
demonstrated by the historical fact that leaders of national liberation
movements such as Nelson Mandela in South Africa, Habib Bourgouiba in
Tunisia, or Ahmed Ben Bella in Algeria, to mention only a few, were
originally labeled as terrorists by those who controlled the territory at the
time, but later became internationally respected statesmen.
This definitional predicament of an organization consisting of
sovereign states and not of peoples, in spite of the emphasis in the
Preamble to the United Nations Charter! has become even more serious
in the present global power constellation: one superpower exercises the
decisive role in the Security Council, former great powers of the Cold War
era as well as medium powers are increasingly being marginalized; and the
problem has become even more acute since the terrorist attacks of 11
September 2001 I the United States.[141]

What, then, is the defining criterion for terrorist acts

the differentia specifica distinguishing those acts from eventually legitimate
The absence of a law defining acts of terrorism may result in abuse and
acts of national resistance or self-defense?
oppression on the part of the police or military. An illustration is when a group of persons are
Since the times of the Cold War the United Nations Organization
has been trying in vain to reach a consensus on the basic issue of merely engaged in a drinking spree. Yet the military or the police may consider the act as an
definition. The organization has intensified its efforts recently, but has been
unable to bridge the gap between those who associate terrorism with act of terrorism and immediately arrest them pursuant to G.O. No. 5. Obviously, this is abuse
any violent act by non-state groups against civilians, state functionaries or
infrastructure or military installations, and those who believe in the concept and oppression on their part. It must be remembered that an act can only be considered a crime
of the legitimate use of force when resistance against foreign occupation or if there is a law defining the same as such and imposing the corresponding penalty thereon.
against systematic oppression of ethnic and/or religious groups within a
state is concerned.

The dilemma facing the international community can best be

illustrated by reference to the contradicting categorization of organizations So far, the word terrorism appears only once in our criminal laws, i.e., in P.D. No.
and movements such as Palestine Liberation Organization (PLO) which is
a terrorist group for Israel and a liberation movement for Arabs and Muslims 1835 dated January 16, 1981 enacted by President Marcos during the Martial Law regime. This
the Kashmiri resistance groups who are terrorists in the perception of
decree is entitled Codifying The Various Laws on Anti-Subversion and Increasing The
India, liberation fighters in that of Pakistan the earlier Contras in
Nicaragua freedom fighters for the United States, terrorists for the Penalties for Membership in Subversive Organizations. The word terrorism is mentioned in
Socialist camp or, most drastically, the Afghani Mujahedeen (later to
become the Taliban movement): during the Cold War period they were a the following provision: That one who conspires with any other person for the purpose of
group of freedom fighters for the West, nurtured by the United States, and a
terrorist gang for the Soviet Union. One could go on and on in enumerating overthrowing the Government of the Philippines x x x by force, violence, terrorism, x x x shall be
examples of conflicting categorizations that cannot be reconciled in any way
because of opposing political interests that are at the roots of those punished by reclusion temporal x x x.
perceptions.

How, then, can those contradicting definitions and conflicting

perceptions and evaluations of one and the same group and its actions be
explained? In our analysis, the basic reason for these striking
inconsistencies lies in the divergent interest of states. Depending on P.D. No. 1835 was repealed by E.O. No. 167 (which outlaws the Communist Party of
whether a state is in the position of an occupying power or in that of a rival,
or adversary, of an occupying power in a given territory, the definition of the Philippines) enacted by President Corazon Aquino on May 5, 1985. These two (2) laws,
terrorism will fluctuate accordingly. A state may eventually see itself as
however, do not define acts of terrorism. Since there is no law defining acts of terrorism,
protector of the rights of a certain ethnic group outside its territory and will
therefore speak of a liberation struggle, not of terrorism when acts of it is President Arroyo alone, under G.O. No. 5, who has the discretion to determine what acts
violence by this group are concerned, and vice-versa.
constitute terrorism. Her judgment on this aspect is absolute, without
restrictions. Consequently, there can be indiscriminate arrest without warrants, breaking into

offices and residences, taking over the media enterprises, prohibition and dispersal of all In the Brief Account[144] submitted by petitioner David, certain facts are

assemblies and gatherings unfriendly to the administration. All these can be effected in the established: first, he was arrested without warrant; second, the PNP operatives arrested him on

name of G.O. No. 5. These acts go far beyond the calling-out power of the President. Certainly, the basis of PP 1017; third, he was brought at Camp Karingal, Quezon City where he

they violate the due process clause of the Constitution. Thus, this Court declares that the acts was fingerprinted, photographed and booked like a criminal suspect; fourth, he was treated

of terrorism portion of G.O. No. 5 is unconstitutional. brusquely by policemen who held his head and tried to push him inside an unmarked

car; fifth, he was charged with Violation of Batas Pambansa Bilang No.
[145]
880 and Inciting to Sedition; sixth, he was detained for seven (7) hours; and seventh, he

was eventually released for insufficiency of evidence.

Significantly, there is nothing in G.O. No. 5 authorizing the military or police to commit

acts beyond what are necessary and appropriate to suppress and prevent lawless

violence, the limitation of their authority in pursuing the Order. Otherwise, such acts are Section 5, Rule 113 of the Revised Rules on Criminal Procedure provides:

considered illegal. Sec. 5. Arrest without warrant; when lawful. - A peace

officer or a private person may, without a warrant, arrest a person:

(a) When, in his presence, the person to be arrested has

committed, is actually committing, or is attempting to commit an
offense.

We first examine G.R. No. 171396 (David et al.) (b) When an offense has just been committed and he has
probable cause to believe based on personal knowledge of facts or
circumstances that the person to be arrested has committed it; and

x x x.

The Constitution provides that the right of the people to be secured in their persons,

houses, papers and effects against unreasonable search and seizure of whatever nature and for

any purpose shall be inviolable, and no search warrant or warrant of arrest shall issue except Neither of the two (2) exceptions mentioned above justifies petitioner
upon probable cause to be determined personally by the judge after examination under oath or Davids warrantless arrest. During the inquest for the charges of inciting to
affirmation of the complainant and the witnesses he may produce, and particularly describing the sedition andviolation of BP 880, all that the arresting officers could invoke was their
place to be searched and the persons or things to be seized.[142] The plain import of the observation that some rallyists were wearing t-shirts with the invective Oust Gloria
language of the Constitution is that searches, seizures and arrests are normally unreasonable Nowand their erroneous assumption that petitioner David was the leader of the
unless authorized by a validly issued search warrant or warrant of arrest. Thus, the fundamental rally. [146]
Consequently, the Inquest Prosecutor ordered his immediate release on the ground of
protection given by this provision is that between person and police must stand the protective insufficiency of evidence. He noted that petitioner David was not wearing the subject t-shirt and
authority of a magistrate clothed with power to issue or refuse to issue search warrants or even if he was wearing it, such fact is insufficient to charge him with inciting to
[143]
warrants of arrest. sedition. Further, he also stated that there is insufficient evidence for the charge of violation of

BP 880 as it was not even known whether petitioner David was the leader of the rally.[147]
 be gleaned from circumstances, the charges of inciting to seditionand violation of BP

880 were mere afterthought. Even the Solicitor General, during the oral argument, failed to

justify the arresting officers conduct. In De Jonge v. Oregon,[148] it was held that peaceable

assembly cannot be made a crime, thus:

But what made it doubly worse for petitioners David et al. is that not only was their Peaceable assembly for lawful discussion cannot be made a
crime. The holding of meetings for peaceable political action cannot be
right against warrantless arrest violated, but also their right to peaceably assemble.
proscribed. Those who assist in the conduct of such meetings cannot be
branded as criminals on that score. The question, if the rights of free speech
and peaceful assembly are not to be preserved, is not as to the auspices
under which the meeting was held but as to its purpose; not as to the
relations of the speakers, but whether their utterances transcend the bounds
of the freedom of speech which the Constitution protects. If the persons
assembling have committed crimes elsewhere, if they have formed or are
engaged in a conspiracy against the public peace and order, they may be
prosecuted for their conspiracy or other violations of valid laws. But it is a
different matter when the State, instead of prosecuting them for such
offenses, seizes upon mere participation in a peaceable assembly and
a lawful public discussion as the basis for a criminal charge.
Section 4 of Article III guarantees:

No law shall be passed abridging the freedom of speech, of

expression, or of the press, or the right of the people peaceably to assemble
and petition the government for redress of grievances. On the basis of the above principles, the Court likewise considers the dispersal and

arrest of the members of KMU et al. (G.R. No. 171483) unwarranted. Apparently, their dispersal

was done merely on the basis of Malacaangs directive canceling all permits previously issued
Assembly means a right on the part of the citizens to meet peaceably for
by local government units. This is arbitrary. The wholesale cancellation of all permits to rally is
consultation in respect to public affairs. It is a necessary consequence of our republican
a blatant disregard of the principle that freedom of assembly is not to be limited, much less
institution and complements the right of speech. As in the case of freedom of expression, this
denied, except on a showing of a clear and present danger of a substantive evil that the
right is not to be limited, much less denied, except on a showing of a clear and present
State has a right to prevent.[149] Tolerance is the rule and limitation is the exception. Only
danger of a substantive evil that Congress has a right to prevent. In other words, like other
upon a showing that an assembly presents a clear and present danger that the State may deny
rights embraced in the freedom of expression, the right to assemble is not subject to previous
the citizens right to exercise it. Indeed, respondents failed to show or convince the Court that
restraint or censorship. It may not be conditioned upon the prior issuance of a permit or
the rallyists committed acts amounting to lawless violence, invasion or rebellion. With the
authorization from the government authorities except, of course, if the assembly is intended to
blanket revocation of permits, the distinction between protected and unprotected assemblies
be held in a public place, a permit for the use of such place, and not for the assembly itself, may
was eliminated.
be validly required.

Moreover, under BP 880, the authority to regulate assemblies and rallies is lodged

with the local government units. They have the power to issue permits and to revoke such
The ringing truth here is that petitioner David, et al. were arrested while they were
permits after due notice and hearing on the determination of the presence of clear and present
exercising their right to peaceful assembly. They were not committing any crime, neither was
danger. Here, petitioners were not even notified and heard on the revocation of their
there a showing of a clear and present danger that warranted the limitation of that right. As can
permits.[150] The first time they learned of it was at the time of the dispersal. Such absence of
notice is a fatal defect. When a persons right is restricted by government action, it behooves a
democratic government to see to it that the restriction is fair, reasonable, and according to
procedure.
G.R. No. 171409, (Cacho-Olivares, et al.) presents another facet of freedom of
speech i.e., the freedom of the press. Petitioners narration of facts, which the Solicitor General
failed to refute, established the following: first, the Daily Tribunes offices were searched
without warrant; second, the police operatives seized several materials for publication; third, the
search was conducted at about 1:00 o clock in the morning of February 25, 2006; fourth, the
search was conducted in the absence of any official of the Daily Tribune except the security
guard of the building; and fifth, policemen stationed themselves at the vicinity of the Daily
Tribune offices.
Thereafter, a wave of warning came from government officials. Presidential Chief of Staff
Michael Defensor was quoted as saying that such raid was meant to show a strong
presence, to tell media outlets not to connive or do anything that would help the rebels
in bringing down this government. Director General Lomibao further stated that if they
do not follow the standards and the standards are if they would contribute to instability
in the government, or if they do not subscribe to what is in General Order No. 5 and Proc.
No. 1017 we will recommend a takeover. National Telecommunications Commissioner
Ronald Solis urged television and radio networks to cooperate with the government for the
duration of the state of national emergency. He warned that his agency will not hesitate to
recommend the closure of any broadcast outfit that violates rules set out for media
coverage during times when the national security is threatened.[151]
The search is illegal. Rule 126 of The Revised Rules on Criminal Procedure lays
down the steps in the conduct of search and seizure. Section 4 requires that a search
warrant be issued upon probable cause in connection with one specific offence to be
determined personally by the judge after examination under oath or affirmation of the
complainant and the witnesses he may produce. Section 8 mandates that the search of a
house, room, or any other premise be made in the presence of the lawful occupantthereof or
any member of his family or in the absence of the latter, in the presence of two (2) witnesses of
sufficient age and discretion residing in the same locality. And Section 9 states that the
warrant must direct that it be served in the daytime, unless the property is on the person or in
the place ordered to be searched, in which case a direction may be inserted that it be served at
any time of the day or night. All these rules were violated by the CIDG operatives.
Not only that, the search violated petitioners freedom of the press. The best gauge
of a free and democratic society rests in the degree of freedom enjoyed by its media. In
the Burgos v. Chief of Staff[152] this Court held that --
As heretofore stated, the premises searched were the business
and printing offices of the "Metropolitan Mail" and the "We Forum
newspapers. As a consequence of the search and seizure, these premises
were padlocked and sealed, with the further result that the printing and
publication of said newspapers were discontinued.
Such closure is in the nature of previous restraint or
censorship abhorrent to the freedom of the press guaranteed under
the fundamental law, and constitutes a virtual denial of petitioners'
freedom to express themselves in print. This state of being is patently
anathematic to a democratic framework where a free, alert and even
militant press is essential for the political enlightenment and growth of
the citizenry.
While admittedly, the Daily Tribune was not padlocked and sealed like the
Metropolitan Mail and We Forum newspapers in the above case, yet it cannot be denied
that the CIDG operatives exceeded their enforcement duties. The search and seizure of
materials for publication, the stationing of policemen in the vicinity of the The Daily
Tribune offices, and the arrogant warning of government officials to media, are plain
censorship. It is that officious functionary of the repressive government who tells the citizen that
he may speak only if allowed to do so, and no more and no less than what he is permitted to say
on pain of punishment should he be so rash as to disobey. [153] Undoubtedly, the The Daily
Tribune was subjected to these arbitrary intrusions because of its anti-government

sentiments. This Court cannot tolerate the blatant disregard of a constitutional right even if it
involves the most defiant of our citizens. Freedom to comment on public affairs is essential to
the vitality of a representative democracy. It is the duty of the courts to be watchful for the
constitutional rights of the citizen, and against any stealthy encroachments thereon. The motto
should always be obsta principiis.[154]
Incidentally, during the oral arguments, the Solicitor General admitted that the search
of the Tribunes offices and the seizure of its materials for publication and other papers are
illegal; and that the same are inadmissible for any purpose, thus:
JUSTICE CALLEJO:
You made quite a mouthful of admission when
you said that the policemen, when inspected
the Tribune for the purpose of gathering
evidence and you admitted that the
policemen were able to get the clippings. Is
that not in admission of the admissibility of
these clippings that were taken from the
Tribune?
SOLICITOR GENERAL BENIPAYO:
Under the law they would seem to be, if they
were illegally seized, I think and I know, Your
Honor, and these are inadmissible for any
purpose.[155]
xxx xxx xxx
SR. ASSO. JUSTICE PUNO:
These have been published in the past issues of
the Daily Tribune; all you have to do is to get
those past issues. So why do you have to go
there at 1 oclock in the morning and without
any search warrant? Did they become
suddenly part of the evidence of rebellion or
inciting to sedition or what?
SOLGEN BENIPAYO:
Well, it was the police that did that, Your
Honor. Not upon my instructions.
SR. ASSO. JUSTICE PUNO:
Are you saying that the act of the policeman is
illegal, it is not based on any law, and it is not
based on Proclamation 1017.
SOLGEN BENIPAYO:
It is not based on Proclamation 1017, Your
Honor, because there is nothing in 1017
which says that the police could go and
inspect and gather clippings from Daily
Tribune or any other newspaper.
SR. ASSO. JUSTICE PUNO:
Is it based on any law?
SOLGEN BENIPAYO:
As far as I know, no, Your Honor, from the
facts, no.
SR. ASSO. JUSTICE PUNO:
So, it has no basis, no legal basis whatsoever?
SOLGEN BENIPAYO:
Maybe so, Your Honor. Maybe so, that is why I
said, I dont know if it is premature to say
this, we do not condone this. If the people
who have been injured by this would want
to sue them, they can sue and there are
remedies for this.[156]
Likewise, the warrantless arrests and seizures executed by the police were, according
to the Solicitor General, illegal and cannot be condoned, thus:
CHIEF JUSTICE PANGANIBAN:
There seems to be some confusions if not
contradiction in your theory.
SOLICITOR GENERAL BENIPAYO:
I dont know whether this will clarify. The acts,
the supposed illegal or unlawful acts committed on the
occasion of 1017, as I said, it cannot be
condoned. You cannot blame the President for, as
you said, a misapplication of the law. These are acts of
the police officers, that is their responsibility.[157]
 standards on media or any form of prior restraint on the press, are ultra

The Dissenting Opinion states that PP 1017 and G.O. No. 5 are constitutional in every vires and unconstitutional. The Court also rules that under Section 17, Article XII of the

aspect and should result in no constitutional or statutory breaches if applied according to their Constitution, the President, in the absence of a legislation, cannot take over privately-owned

letter. public utility and private business affected with public interest.

The Court has passed upon the constitutionality of these issuances. Its ratiocination

has been exhaustively presented. At this point, suffice it to reiterate that PP 1017 is limited to

the calling out by the President of the military to prevent or suppress lawless violence, invasion In the same vein, the Court finds G.O. No. 5 valid. It is an Order issued by the

or rebellion. When in implementing its provisions, pursuant to G.O. No. 5, the military and the President acting as Commander-in-Chief addressed to subalterns in the AFP to carry out

police committed acts which violate the citizens rights under the Constitution, this Court has to the provisions of PP 1017. Significantly, it also provides a valid standard that the military and

declare such acts unconstitutional and illegal. the police should take only the necessary and appropriate actions and measures to

suppress and prevent acts of lawless violence. But the words acts of terrorism found

In this connection, Chief Justice Artemio V. Panganibans concurring opinion, in G.O. No. 5 have not been legally defined and made punishable by Congress and should thus

attached hereto, is considered an integral part of this ponencia. be deemed deleted from the said G.O. While terrorism has been denounced generally in

media, no law has been enacted to guide the military, and eventually the courts, to determine

the limits of the AFPs authority in carrying out this portion of G.O. No. 5.

SUMMATION

On the basis of the relevant and uncontested facts narrated earlier, it is also pristine
In sum, the lifting of PP 1017 through the issuance of PP 1021 a supervening event
clear that (1) the warrantless arrest of petitioners Randolf S. David and Ronald Llamas; (2) the
would have normally rendered this case moot and academic. However, while PP 1017 was
dispersal of the rallies and warrantless arrest of the KMU and NAFLU-KMU members; (3) the
still operative, illegal acts were committed allegedly in pursuance thereof. Besides, there is no
imposition of standards on media or any prior restraint on the press; and (4) the warrantless
guarantee that PP 1017, or one similar to it, may not again be issued. Already, there have
search of the Tribune offices and the whimsical seizures of some articles for publication and
been media reports on April 30, 2006 that allegedly PP 1017 would be reimposed if the May 1
other materials, are not authorized by the Constitution, the law and jurisprudence. Not even by
rallies become unruly and violent. Consequently, the transcendental issues raised by the
the valid provisions of PP 1017 and G.O. No. 5.
parties should not be evaded; they must now be resolved to prevent future constitutional

aberration.

Other than this declaration of invalidity, this Court cannot impose any civil, criminal or
The Court finds and so holds that PP 1017 is constitutional insofar as it constitutes a
administrative sanctions on the individual police officers concerned. They have not been
call by the President for the AFP to prevent or suppress lawless violence. The proclamation is
individually identified and given their day in court. The civil complaints or causes of action
sustained by Section 18, Article VII of the Constitution and the relevant jurisprudence discussed
and/or relevant criminal Informations have not been presented before this Court. Elementary
earlier. However, PP 1017s extraneous provisions giving the President express or implied
due process bars this Court from making any specific pronouncement of civil, criminal or
power (1) to issue decrees; (2) to direct the AFP to enforce obedience to all laws even those not
administrative liabilities.
related to lawless violence as well as decrees promulgated by the President; and (3) to impose
 The warrantless arrest of Randolf S. David and Ronald Llamas; the dispersal and

It is well to remember that military power is a means to an end and substantive warrantless arrest of the KMU and NAFLU-KMU members during their rallies, in the absence of

civil rights are ends in themselves. How to give the military the power it needs to protect proof that these petitioners were committing acts constituting lawless violence, invasion or

the Republic without unnecessarily trampling individual rights is one of the eternal rebellion and violating BP 880; the imposition of standards on media or any form of prior restraint

balancing tasks of a democratic state. During emergency, governmental action may vary in on the press, as well as the warrantless search of the Tribune offices and whimsical seizure of

breadth and intensity from normal times, yet they should not be arbitrary as to unduly restrain its articles for publication and other materials, are declared UNCONSTITUTIONAL.

our peoples liberty. No costs.

Perhaps, the vital lesson that we must learn from the theorists who studied the various

competing political philosophies is that, it is possible to grant government the authority to cope SO ORDERED.

with crises without surrendering the two vital principles of constitutionalism: the maintenance of

legal limits to arbitrary power, and political responsibility of the government to the

governed.[158]

WHEREFORE, the Petitions are partly granted. The Court rules that PP 1017

is CONSTITUTIONAL insofar as it constitutes a call by President Gloria Macapagal-Arroyo on

the AFP to prevent or suppress lawless violence. However, the provisions of PP 1017

commanding the AFP to enforce laws not related to lawless violence, as well as decrees
promulgated by the President, are declared UNCONSTITUTIONAL. In addition, the provision in

PP 1017 declaring national emergency under Section 17, Article VII of the Constitution

is CONSTITUTIONAL, but such declaration does not authorize the President to take over

privately-owned public utility or business affected with public interest without prior legislation.

G.O. No. 5 is CONSTITUTIONAL since it provides a standard by which the AFP and

the PNP should implement PP 1017, i.e. whatever is necessary and appropriate actions

and measures to suppress and prevent acts of lawless violence. Considering that acts

of terrorism have not yet been defined and made punishable by the Legislature, such portion of

G.O. No. 5 is declared UNCONSTITUTIONAL.

 SUPREME COURT
Manila
EN BANC
G.R. No. 103702 December 6, 1994
MUNICIPALITY OF SAN NARCISO, QUEZON; MAYOR JUAN K. UY; COUNCILORS:
DEOGRACIAS R. ARGOSINO III, BENITO T. CAPIO, EMMANUEL R. CORTEZ, NORMANDO
MONTILLA, LEONARDO C. UY, FIDEL C. AURELLANA, PEDRO C. CARABIT, LEONARDO
D. AURELLANA, FABIAN M. MEDENILLA, TRINIDAD F. CORTEZ, SALVADOR M.
MEDENILLA, CERELITO B. AUREADA and FRANCISCA A. BAMBA, petitioners,
vs.
HON. ANTONIO V. MENDEZ, SR., Presiding Judge, Regional Trial Court, Branch 62, 4th
Judicial Region, Gumaca, Quezon; MUNICIPALITY OF SAN ANDRES, QUEZON; MAYOR
FRANCISCO DE LEON; COUNCILORS: FE LUPINAC, TOMAS AVERIA, MANUEL O. OSAS,
WILFREDO O. FONTANIL, ENRICO U. NADRES, RODELITO LUZOIR, LENAC, JOSE L.
CARABOT, DOMING AUSA, VIDAL BANQUELES and CORAZON M. MAXIMO, respondents.
Manuel Laserna, Jr. for petitioners.
Florante Pamfilo for private respondents.
VITUG, J.:
On 20 August 1959, President Carlos P. Garcia, issued, pursuant to the then Sections 68 and
2630 of the Revised Administrative Code, as amended, Executive Order No. 353 creating the
municipal district of San Andres, Quezon, by segregating from the municipality of San Narciso of
the same province, the barrios of San Andres, Mangero, Alibijaban, Pansoy, Camflora and Tala
along with their respective sitios.
Executive Order No. 353 was issued upon the request, addressed to the President and coursed
through the Provincial Board of Quezon, of the municipal council of San Narciso, Quezon, in its
Resolution No. 8 of 24 May 1959.1
By virtue of Executive Order No. 174, dated 05 October 1965, issued by President Diosdado
Macapagal, the municipal district of San Andres was later officially recognized to have gained
the status of a fifth class municipality beginning 01 July 1963 by operation of Section 2 of
Republic Act No. 1515.2 The executive order added that "(t)he conversion of this municipal
district into (a) municipality as proposed in House Bill No. 4864 was approved by the House of
Representatives."
On 05 June 1989, the Municipality of San Narciso filed a petition for quo warranto with the
Regional Trial Court, Branch 62, in Gumaca, Quezon, against the officials of the Municipality of
San Andres. Docketed Special Civil Action No. 2014-G, the petition sought the declaration of
nullity of Executive Order No. 353 and prayed that the respondent local officials of the
Municipality of San Andres be permanently ordered to refrain from performing the duties and
functions of their respective offices.3 Invoking the ruling of this Court in Pelaez v. Auditor
General,4 the petitioning municipality contended that Executive Order No. 353, a presidential act,
was a clear usurpation of the inherent powers of the legislature and in violation of the
constitutional principle of separation of powers. Hence, petitioner municipality argued, the
officials of the Municipality or Municipal District of San Andres had no right to exercise the duties
and functions of their respective offices that righfully belonged to the corresponding officials of
the Municipality of San Narciso.
In their answer, respondents asked for the dismissal of the petition, averring, by way of
affirmative and special defenses, that since it was at the instance of petitioner municipality that
the Municipality of San Andres was given life with the issuance of Executive Order No. 353, it
(petitioner municipality) should be deemed estopped from questioning the creation of the new
municipality;5 that because the Municipality of San Andred had been in existence since 1959, its
corporate personality could no longer be assailed; and that, considering the petition to be one
for quo warranto, petitioner municipality was not the proper party to bring the action, that
prerogative being reserved to the State acting through the Solicitor General.6
On 18 July 1991, after the parties had submitted their respective pre-trial briefs, the trial court
resolved to defer action on the motion to dismiss and to deny a judgment on the pleadings.
On 27 November 1991, the Municipality of San Andres filed anew a motion to dismiss alleging
that the case had become moot and academic with the enactment of Republic Act No. 7160,
otherwise known as the Local Government Code of 1991, which took effect on 01 January 1991.
The movant municipality cited Section 442(d) of the law, reading thusly:
Sec. 442. Requisites for Creation. . . .
(d) Municipalities existing as of the date of the effectivity of this Code shall
continue to exist and operate as such. Existing municipal districts organized
pursuant to presidential issuances or executive orders and which have their
respective set of elective municipal officials holding office at the time of the
effectivity of this Code shall henceforth be considered as regular
municipalities.
The motion was opposed by petitioner municipality, contending that the above
provision of law was inapplicable to the Municipality of San Andres since the
enactment referred to legally existing municipalities and not to those whose mode of
creation had been void ab initio.7
In its Order of 02 December 1991, the lower court8 finally dismissed the petition9 for lack of
cause of action on what it felt was a matter that belonged to the State, adding that "whatever
defects (were) present in the creation of municipal districts by the President pursuant to
presidential issuances and executive orders, (were) cured by the enactment of R.A. 7160,
otherwise known as Local Government Code of 1991." In an order, dated 17 January 1992, the
same court denied petitioner municipality's motion for reconsideration.
Hence, this petition "for review on certiorari." Petitioners 10 argue that in issuing the orders of 02
December 1991 and 17 January 1992, the lower court has "acted with grave abuse of discretion
amounting to lack of or in excess of jurisdiction." Petitioners assert that the existence of a
municipality created by a null and void presidential order may be attacked either directly or even
collaterally by anyone whose interests or rights are affected, and that an unconstitutional act is
not a law, creates no office and is inoperative such as though its has never been passed. 11
Petitioners consider the instant petition to be one for "review on certiorari" under Rules 42 and
45 of the Rules of Court; at the same time, however, they question the orders of the lower court
for having been issued with "grave abuse of discretion amounting to lack of or in excess of
jurisdiction, and that there is no other plain, speedy and adequate remedy in the ordinary course
of law available to petitioners to correct said Orders, to protect their rights and to secure a final
and definitive interpretation of the legal issues involved." 12 Evidently, then, the petitioners intend
to submit their case in this instance under Rule 65. We shall disregard the procedural
incongruence.
The special civil action of quo warranto is a "prerogative writ by which the Government can call
upon any person to show by what warrant he holds a public office or exercises a public
franchise." 13 When the inquiry is focused on the legal existence of a body politic, the action is
reserved to the State in a proceeding for quo warranto or any other credit proceeding. 14 It must
be brought "in the name of the Republic of the Philippines" 15 and commenced by the Solicitor
General or the fiscal "when directed by the President of the Philippines . . . ." 16 Such officers
may, under certain circumstances, bring such an action "at the request and upon the relation of
another person" with the permission of the court. 17 The Rules of Court also allows an individual
to commence an action for quo warranto in his own name but this initiative can be done when he
claims to be "entitled to a public office or position usurped or unlawfully held or exercised by
another." 18 While the quo warranto proceedings filed below by petitioner municipality has so
named only the officials of the Municipality of San Andres as respondents, it is virtually,
however, a denunciation of the authority of the Municipality or Municipal District of San Andres to
exist and to act in that capacity.
At any rate, in the interest of resolving any further doubt on the legal status of the Municipality of
San Andres, the Court shall delve into the merits of the petition.
While petitioners would grant that the enactment of Republic Act
No. 7160 may have converted the Municipality of San Andres into a de facto municipality, they,
however, contend that since the petition for quo warranto had been filed prior to the passage of
said law, petitioner municipality had acquired a vested right to seek the nullification of Executive
Order No. 353, and any attempt to apply Section 442 of Republic Act 7160 to the petition would
perforce be violative of due process and the equal protection clause of the Constitution.
surpassed the income requirement laid out in Republic Act No. 1515. Section 31 of Batas
Pambansa Blg. 129, otherwise known as the Judiciary Reorganization Act of 1980, constituted
as municipal circuits, in the establishment of Municipal Circuit Trial Courts in the country, certain
municipalities that comprised the municipal circuits organized under Administrative Order No.
33, dated 13 June 1978, issued by this Court pursuant to Presidential Decree No. 537. Under
this administrative order, the Municipality of San Andres had been covered by the 10th Municipal
Circuit Court of San Francisco-San Andres for the province of Quezon.
At the present time, all doubts on the de jure standing of the municipality must be dispelled.
Under the Ordinance (adopted on 15 October 1986) apportioning the seats of the House of
Representatives, appended to the 1987 Constitution, the Municipality of San Andres has been
considered to be one of the twelve (12) municipalities composing the Third District of the
province of Quezon. Equally significant is Section 442(d) of the Local Government Code to the
effect that municipal districts "organized pursuant to presidential issuances or executive orders
and which have their respective sets of elective municipal officials holding office at the time of
the effectivity of (the) Code shall henceforth be considered as regular municipalities." No
pretension of unconstitutionality per se of Section 442(d) of the Local Government Code is
proferred. It is doubtful whether such a pretext, even if made, would succeed. The power to
create political subdivisions is a function of the legislature. Congress did just that when it has
incorporated Section 442(d) in the Code. Curative laws, which in essence are
retrospective, 21 and aimed at giving "validity to acts done that would have been invalid under
existing laws, as if existing laws have been complied with," are validly accepted in this
jurisdiction, subject to the usual qualification against impairment of vested rights. 22
All considered, the de jure status of the Municipality of San Andres in the province of Quezon
must now be conceded.
WHEREFORE, the instant petition for certiorari is hereby DISMISSED. Costs against petitioners.
SO ORDERED.

Narvasa, C.J., Padilla, Bidin, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Quiason, Puno,
Petitioners' theory might perhaps be a point to consider had the case been seasonably brought.
Kapunan and Mendoza, JJ. concur.
Executive Order No. 353 creating the municipal district of San Andres was issued on 20 August
1959 but it was only after almost thirty (30) years, or on 05 June 1989, that the municipality of
San Narciso finally decided to challenge the legality of the executive order. In the meantime, the Feliciano, J., is on leave.
Municipal District, and later the Municipality, of San Andres, began and continued to exercise the
powers and authority of a duly created local government unit. In the same manner that the
failure of a public officer to question his ouster or the right of another to hold a position within a
one-year period can abrogate an action belatedly filed, 19 so also, if not indeed with greatest
imperativeness, must a quo warranto proceeding assailing the lawful authority of a political
subdivision be timely raised. 20 Public interest
demands it.

Granting the Executive Order No. 353 was a complete nullity for being the result of an
unconstitutional delegation of legislative power, the peculiar circumstances obtaining in this case
hardly could offer a choice other than to consider the Municipality of San Andres to have at least
attained a status uniquely of its own closely approximating, if not in fact attaining, that of a de
facto municipal corporation. Conventional wisdom cannot allow it to be otherwise. Created in
1959 by virtue of Executive Order No. 353, the Municipality of San Andres had been in existence
for more than six years when, on 24 December 1965, Pelaez v. Auditor General was
promulgated. The ruling could have sounded the call for a similar declaration of the
unconstitutionality of Executive Order No. 353 but it was not to be the case. On the contrary,
certain governmental acts all pointed to the State's recognition of the continued existence of the
Municipality of San Andres. Thus, after more than five years as a municipal district, Executive
Order No. 174 classified the Municipality of San Andres as a fifth class municipality after having
 EN BANC as well as qualified stranded contract costs of distribution utilities
resulting from the restructuring of the industry;
ROMEO P. GEROCHI, KATULONG NG BAYAN (KB) and G.R. No. 159796
ENVIRONMENTALIST CONSUMERS NETWORK, INC. (b) Missionary electrification;[6]
(ECN), Present:
Petitioners, (c) The equalization of the taxes and royalties applied to indigenous or
PUNO, C.J., renewable sources of energy vis--vis imported energy fuels;
-versus- QUISUMBING,
YNARES-SANTIAGO, (d) An environmental charge equivalent to one-fourth of one centavo per
DEPARTMENT OF ENERGY (DOE), ENERGY SANDOVAL-GUTIERREZ, kilowatt-hour (P0.0025/kWh), which shall accrue to an environmental
REGULATORY COMMISSION (ERC), NATIONAL CARPIO, fund to be used solely for watershed rehabilitation and management.
POWER CORPORATION (NPC), POWER SECTOR AUSTRIA-MARTINEZ, Said fund shall be managed by NPC under existing arrangements;
ASSETS AND LIABILITIES MANAGEMENT GROUP CORONA, and
(PSALM Corp.), STRATEGIC POWER UTILITIES CARPIO MORALES,
GROUP (SPUG), and PANAYELECTRIC COMPANY INC. AZCUNA, (e) A charge to account for all forms of cross-subsidies for a period not
(PECO), TINGA, exceeding three (3) years.
Respondents. CHICO-NAZARIO,
GARCIA, The universal charge shall be a non-bypassable charge which shall be
VELASCO, JR. and passed on and collected from all end-users on a monthly basis by the
NACHURA, JJ. distribution utilities. Collections by the distribution utilities and the
TRANSCO in any given month shall be remitted to the PSALM Corp. on or
Promulgated: 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
July 17, 2007 connected to a distribution utility shall remit its corresponding universal
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x 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
DECISION collected for the universal charge shall be distributed to the respective
beneficiaries within a reasonable period to be provided by the ERC.
NACHURA, J.:

The Facts
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
Congress enacted the EPIRA on June 8, 2001; on June 26, 2001, it took effect.[7]
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
On April 5, 2002, respondent National Power Corporation-Strategic Power Utilities
Regulations (IRR)[2] which seeks to implement the said imposition, be declared unconstitutional.
[8]
Group (NPC-SPUG) filed with respondent Energy Regulatory Commission (ERC) a petition for
Petitioners also pray that the Universal Charge imposed upon the consumers be refunded and
the availment from the Universal Charge of its share for Missionary Electrification, docketed as
that a preliminary injunction and/or temporary restraining order (TRO) be issued directing the
ERC Case No. 2002-165.[9]
respondents to refrain from implementing, charging, and collecting the said charge. [3] The

assailed provision of law reads:

On May 7, 2002, NPC filed another petition with ERC, docketed as ERC Case No. 2002-194,

SECTION 34. Universal Charge. Within one (1) year from the praying that the proposed share from the Universal Charge for the Environmental charge
effectivity of this Act, a universal charge to be determined, fixed and
of P0.0025 per kilowatt-hour (/kWh), or a total of P119,488,847.59, be approved for withdrawal
approved by the ERC, shall be imposed on all electricity end-users for the
following purposes: from the Special Trust Fund (STF) managed by respondent Power SectorAssets and
[4]
(a) Payment for the stranded debts in excess of the amount assumed by
the National Government and stranded contract costs of NPC[5] 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]
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
Petitioners contend that the Universal Charge has the characteristics of a tax and is Charge, pursuant to Sec. 34 of the EPIRA and the Decisions in ERC Case Nos. 2002-194 and
[19]
collected to fund the operations of the NPC. They argue that the cases invoked by the 2002-165. Otherwise, PECO could be held liable under Sec. 46[24] of the EPIRA, which imposes
respondents clearly show the regulatory purpose of the charges imposed therein, which is not so fines and penalties for any violation of its provisions or its IRR.[25]
[20]
in the case at bench. In said cases, the respective funds 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
The Issues
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.
The ultimate issues in the case at bar are:
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 1) Whether or not, the Universal Charge imposed under Sec. 34 of the
EPIRA is a tax; and
as support of the government, administration of the law, or payment of public expenses, the
2) Whether or not there is undue delegation of legislative power to tax on
assailed Universal Charge is levied for a specific regulatory purpose, which is to ensure the the part of the ERC.[26]
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 Before we discuss the issues, the Court shall first deal with an obvious procedural
[22]
to the execution and implementation of the provisions of the EPIRA. lapse.

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 Petitioners filed before us an original action particularly denominated as a Complaint

industry, and is, therefore, an exaction in the exercise of the State's police power. Respondents assailing the constitutionality of Sec. 34 of the EPIRA imposing the Universal Charge and Rule

further contend that said Universal Charge does not possess the essential characteristics of a 18 of the EPIRA's IRR. No doubt, petitioners have locus standi. They impugn the

tax, that its imposition would redound to the benefit of the electric power industry and not to the constitutionality of Sec. 34 of the EPIRA because they sustained a direct injury as a result of the

public, and that its rate is uniformly levied on electricity end-users, unlike a tax which is imposed imposition of the Universal Charge as reflected in their electric bills.

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,
However, petitioners violated the doctrine of hierarchy of courts when they filed this
respondents argue that the imposition of the Universal Charge is not oppressive and
Complaint directly with us. Furthermore, the Complaint is bereft of any allegation of grave abuse
confiscatory since it is an exercise of the police power of the State and it complies with the

requirements of due process.[23]

of discretion on the part of the ERC or any of the public respondents, in order for the Court to and probably involving the same parties. In the public interest and to avoid unnecessary delay,

consider it as a petition for certiorari or prohibition. this Court renders its ruling now.

The instant complaint is bereft of merit.

Article VIII, Section 5(1) and (2) of the 1987 Constitution[27] categorically provides that:

The First Issue

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

To resolve the first issue, it is necessary to distinguish the States power of taxation

from the police power.

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.
The power to tax is an incident of sovereignty and is unlimited in its range, acknowledging in its
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 very nature no limits, so that security against its abuse is to be found only in the responsibility of
lower courts in:
the legislature which imposes the tax on the constituency that is to pay it. [30] It is based on the

(a) All cases in which the constitutionality or validity of principle that taxes are the lifeblood of the government, and their prompt and certain availability
any treaty, international or executive is an imperious need.[31] Thus, the theory behind the exercise of the power to tax emanates from
agreement, law, presidential decree, proclamation,
order, instruction, ordinance, or regulation is in necessity; without taxes, government cannot fulfill its mandate of promoting the general welfare
question.
and well-being of the people.[32]

But this Court's jurisdiction to issue writs of certiorari, prohibition, mandamus, quo warranto, On the other hand, police power is the power of the state to promote public welfare by

and habeas corpus, while concurrent with that of the regional trial courts and the Court of restraining and regulating the use of liberty and property.[33] It is the most pervasive, the least

Appeals, does not give litigants unrestrained freedom of choice of forum from which to seek limitable, and the most demanding of the three fundamental powers of the State. The justification

such relief.[28] It has long been established that this Court will not entertain direct resort to it is found in the Latin maxims salus populi est suprema lex (the welfare of the people is the

unless the redress desired cannot be obtained in the appropriate courts, or where exceptional supreme law) and sic utere tuo ut alienum non laedas (so use your property as not to injure the

and compelling circumstances justify availment of a remedy within and call for the exercise of property of others). As an inherent attribute of sovereignty which virtually extends to all public

our primary jurisdiction.[29] This circumstance alone warrants the outright dismissal of the present needs, police power grants a wide panoply of instruments through which the State, as parens

action. 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]

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 The conservative and pivotal distinction between these two powers rests in the

now, the issue will certainly resurface in the near future, resulting in a repeat of this litigation, 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, was reiterated in Osmea v. Orbos[41] with respect to the OPSF. Thus, we disagree with

the fact that revenue is incidentally raised does not make the imposition a tax. [36] petitioners that the instant case is different from the aforementioned cases. With the Universal

In exacting the assailed Universal Charge through Sec. 34 of the EPIRA, the State's police Charge, a Special Trust Fund (STF) is also created under the administration of PSALM.[42] The

power, particularly its regulatory dimension, is invoked. Such can be deduced from Sec. 34 STF has some notable characteristics similar to the OPSF and the SSF, viz.:

which enumerates the purposes for which the Universal Charge is imposed [37] and which can be
1) In the implementation of stranded cost recovery, the ERC shall
amply discerned as regulatory in character. The EPIRA resonates such regulatory purposes, conduct a review to determine whether there is under-recovery or over
recovery and adjust (true-up) the level of the stranded cost recovery
thus:
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
SECTION 2. Declaration of Policy. It is hereby declared the policy of the
be created for these amounts which shall be held in trust for any future
State:
claims of distribution utilities for stranded cost recovery. At the end of
the stranded cost recovery period, any remaining amount in this
(a) To ensure and accelerate the total electrification of the country;
account shall be used to reduce the electricity rates to the end-
(b) To ensure the quality, reliability, security and affordability of the supply of
users.[43]
electric power;
(c) To ensure transparent and reasonable prices of electricity in a regime of
2) With respect to the assailed Universal Charge, if the total amount
free and fair competition and full public accountability to achieve
collected for the same is greater than the actual availments against it,
greater operational and economic efficiency and enhance the
the PSALM shall retain the balance within the STF to pay for periods
competitiveness of Philippine products in the global market;
where a shortfall occurs.[44]
(d) To enhance the inflow of private capital and broaden the ownership base
of the power generation, transmission and distribution sectors;
3) Upon expiration of the term of PSALM, the administration of the STF
(e) To ensure fair and non-discriminatory treatment of public and private
shall be transferred to the DOF or any of the DOF attached agencies
sector entities in the process of restructuring the electric power
as designated by the DOF Secretary.[45]
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 The OSG is in point when it asseverates:
resources in power generation in order to reduce dependence on
imported energy; Evidently, the establishment and maintenance of the Special Trust Fund,
(i) To provide for an orderly and transparent privatization of the assets and under the last paragraph of Section 34, R.A. No. 9136, is well within the
liabilities of the National Power Corporation (NPC); pervasive and non-waivable power and responsibility of the government to
(j) To establish a strong and purely independent regulatory body and system secure the physical and economic survival and well-being of the community,
to ensure consumer protection and enhance the competitive that comprehensive sovereign authority we designate as the police power of
operation of the electricity market; and the State.[46]
(k) To encourage the efficient use of energy and other modalities of demand
side management.
This feature of the Universal Charge further boosts the position that the same is an exaction

From the aforementioned purposes, it can be gleaned that the assailed Universal Charge is not imposed primarily in pursuit of the State's police objectives. The STF reasonably serves and

a tax, but an exaction in the exercise of the State's police power. Public welfare is surely assures the attainment and perpetuity of the purposes for which the Universal Charge is

promoted. imposed, i.e., to ensure the viability of the country's electric power industry.

Moreover, it is a well-established doctrine that the taxing power may be used as an implement of The Second Issue

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 The principle of separation of powers ordains that each of the three branches of

Stabilization Fund (SSF) were exactions made in the exercise of the police power. The doctrine 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.
 bodies with regulatory functions, its exercise should be given a wide
latitude. Police power takes on an even broader dimension in developing
As to the second test, this Court had, in the past, accepted as sufficient standards the following: countries such as ours, where the State must take a more active role in
balancing the many conflicting interests in society. The Questioned Order
"interest of law and order;"[51] "adequate and efficient instruction;"[52] "public interest;"[53] "justice
was issued by the ERC, acting as an agent of the State in the exercise of
and equity;"[54] "public convenience and welfare;"[55] "simplicity, economy and police power. We should have exceptionally good grounds to curtail its
exercise. This approach is more compelling in the field of rate-regulation of
[56] [57] electric power rates. Electric power generation and distribution is a
efficiency;" "standardization and regulation of medical education;" and "fair and equitable
traditional instrument of economic growth that affects not only a few but the
[58]
employment practices." Provisions of the EPIRA such as, among others, to ensure the total entire nation. It is an important factor in encouraging investment and
promoting business. The engines of progress may come to a screeching
electrification of the country and the quality, reliability, security and affordability of the supply of halt if the delivery of electric power is impaired. Billions of pesos would be
electric power[59] and watershed rehabilitation and management[60] meet the requirements for 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
valid delegation, as they provide the limitations on the ERCs power to formulate the IRR. These flexibility, when the need arises.

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
This was reiterated in National Association of Electricity Consumers for Reforms v. Energy
say:
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
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 public utilities.
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 From the foregoing disquisitions, we therefore hold that there is no undue delegation of
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 legislative power to the ERC.
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 Petitioners failed to pursue in their Memorandum the contention in the Complaint that
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 the imposition of the Universal Charge on all end-users is oppressive and confiscatory, and
objectives of the law.
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

In his Concurring and Dissenting Opinion[62] in the same case, then Associate Justice, now Chief
not a tax is excessive, oppressive or confiscatory is an issue which essentially involves
Justice, Reynato S. Puno described the immensity of police power in relation to the delegation of
questions of fact, and thus, this Court is precluded from reviewing the same. [66]
powers to the ERC and its regulatory functions over electric power as a vital public utility, to wit:

As a penultimate statement, it may be well to recall what this Court said of EPIRA:
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
One of the landmark pieces of legislation enacted by Congress in recent
be the primary social interests in earlier times. Police power now requires
years is the EPIRA. It established a new policy, legal structure and
the State to "assume an affirmative duty to eliminate the excesses and
regulatory framework for the electric power industry. The new thrust is to tap
injustices that are the concomitants of an unrestrained industrial economy."
private capital for the expansion and improvement of the industry as the
Police power is now exerted "to further the public welfare a concept as vast
large government debt and the highly capital-intensive character of the
as the good of society itself." Hence, "police power is but another name for
industry itself have long been acknowledged as the critical constraints to the
the governmental authority to further the welfare of society that is the basic
program. To attract private investment, largely foreign, the jaded structure of
end of all government." When police power is delegated to administrative
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.
FRANCISCO I. CHAVEZ, petitioner, vs. HON. ALBERTO G. ROMULO, IN HIS CAPACITY AS
EXECUTIVE SECRETARY; DIRECTOR GENERAL HERMOGENES E. EBDANE,
JR., IN HIS CAPACITY AS THE CHIEF OF THE PNP, et al., respondents.
DECISION
SANDOVAL-GUTIERREZ, J.:
The right of individuals to bear arms is not absolute, but is subject to regulation. The
maintenance of peace and order[1] and the protection of the people against violence are
constitutional duties of the State, and the right to bear arms is to be construed in connection and
in harmony with these constitutional duties.
Before us is a petition for prohibition and injunction seeking to enjoin the implementation of
the Guidelines in the Implementation of the Ban on the Carrying of Firearms Outside of
Residence[2] (Guidelines) issued on January 31, 2003, by respondent Hermogenes E. Ebdane,
Jr., Chief of the Philippine National Police (PNP).
The facts are undisputed:
In January 2003, President Gloria Macapagal-Arroyo delivered a speech before the
members of the PNP stressing the need for a nationwide gun ban in all public places to avert the
rising crime incidents. She directed the then PNP Chief, respondent Ebdane, to suspend the
issuance of Permits to Carry Firearms Outside of Residence (PTCFOR), thus:
THERE IS ALSO NEED TO FOCUS ON THE HIGH PROFILE CRIMES THAT TEND TO
DISTURB THE PSYCHOLOGICAL PERIMETERS OF THE COMMUNITY THE LATEST BEING
THE KILLING OF FORMER NPA LEADER ROLLY KINTANAR. I UNDERSTAND WE
ALREADY HAVE THE IDENTITY OF THE CULPRIT. LET US BRING THEM TO THE BAR OF
JUSTICE.
THE NPA WILL FIND IT MORE DIFFICULT TO CARRY OUT THEIR PLOTS IF OUR LAW
ENFORCEMENT AGENCIES CAN RID THEMSELVES OF RASCALS IN UNIFORM, AND
ALSO IF WE ENFORCE A GUN BAN IN PUBLIC PLACES.
THUS, I AM DIRECTING THE PNP CHIEF TO SUSPEND INDEFINITELY THE ISSUANCE OF
PERMIT TO CARRY FIREARMS IN PUBLIC PLACES. THE ISSUANCE OF PERMITS WILL
NOW BE LIMITED ONLY TO OWNERSHIP AND POSSESSION OF GUNS AND NOT TO
CARRYING THEM IN PUBLIC PLACES. FROM NOW ON, ONLY THE UNIFORMED MEN IN
THE MILITARY AND AUTHORIZED LAW ENFORCEMENT OFFICERS CAN CARRY
FIREARMS IN PUBLIC PLACES, AND ONLY PURSUANT TO EXISTING LAW.CIVILIAN
OWNERS MAY NO LONGER BRING THEIR FIREARMS OUTSIDE THEIR
RESIDENCES. THOSE WHO WANT TO USE THEIR GUNS FOR TARGET PRACTICE WILL
BE GIVEN SPECIAL AND TEMPORARY PERMITS FROM TIME TO TIME ONLY FOR THAT
PURPOSE. AND THEY MAY NOT LOAD THEIR GUNS WITH BULLETS UNTIL THEY ARE IN
THE PREMISES OF THE FIRING RANGE.
WE CANNOT DISREGARD THE PARAMOUNT NEED FOR LAW AND ORDER. JUST AS WE
CANNOT BE HEEDLESS OF OUR PEOPLES ASPIRATIONS FOR PEACE.
Acting on President Arroyos directive, respondent Ebdane issued the assailed Guidelines
quoted as follows:
TO : All Concerned
FROM : Chief, PNP
SUBJECT : Guidelines in the Implementation of the Ban on the Carrying of
Firearms Outside of Residence.
DATE : January 31, 2003
1. Reference: PD 1866 dated June 29, 1983 and its Implementing Rules and
Regulations.
2. General:
The possession and carrying of firearms outside of residence is a privilege
granted by the State to its citizens for their individual protection against all
threats of lawlessness and security.
As a rule, persons who are lawful holders of firearms (regular license,
special permit, certificate of registration or MR) are prohibited from carrying
their firearms outside of residence. However, the Chief, Philippine National
Police may, in meritorious cases as determined by him and under conditions
as he may impose, authorize such person or persons to carry firearms
outside of residence.
3. Purposes:
This Memorandum prescribes the guidelines in the implementation of the
ban on the carrying of firearms outside of residence as provided for in the
Implementing Rules and Regulations, Presidential Decree No. 1866,
dated June 29, 1983 and as directed by PGMA. It also prescribes the
conditions, requirements and procedures under which exemption from the
ban may be granted.
4. Specific Instructions on the Ban on the Carrying of Firearms:
a. All PTCFOR are hereby revoked. Authorized holders of licensed
firearms covered with valid PTCFOR may re-apply for a new
PTCFOR in accordance with the conditions hereinafter
prescribed.
b. All holders of licensed or government firearms are hereby
prohibited from carrying their firearms outside their residence
except those covered with mission/letter orders and duty detail
orders issued by competent authority pursuant to Section 5, IRR,
PD 1866, provided, that the said exception shall pertain only to
organic and regular employees.
5. The following persons may be authorized to carry firearms outside of
residence.
a. All persons whose application for a new PTCFOR has been approved,
provided, that the persons and security of those so authorized are
 under actual threat, or by the nature of their position, occupation and
profession are under imminent danger.
b. All organic and regular employees with Mission/Letter Orders granted by
their respective agencies so authorized pursuant to Section 5, IRR, PD
1866, provided, that such Mission/Letter Orders is valid only for the
duration of the official mission which in no case shall be more than ten
(10) days.
c. All guards covered with Duty Detail Orders granted by their respective
security agencies so authorized pursuant to Section 4, IRR, PD 1866,
provided, that such DDO shall in no case exceed 24-hour duration.
d. Members of duly recognized Gun Clubs issued Permit to Transport (PTT)
by the PNP for purposes of practice and competition, provided, that
such firearms while in transit must not be loaded with ammunition and
secured in an appropriate box or case detached from the person.
e. Authorized members of the Diplomatic Corps.
6. Requirements for issuance of new PTCFOR:
a. Written request by the applicant addressed to Chief, PNP stating his
qualification to possess firearm and the reasons why he needs to carry
firearm outside of residence.
b. Xerox copy of current firearm license duly authenticated by Records
Branch, FED;
c. Proof of actual threat, the details of which should be issued by the Chief
of Police/Provincial or City Directors and duly validated by C, RIID;
d. Copy of Drug Test Clearance, duly authenticated by the Drug Testing
Center, if photocopied;
e. Copy of DI/ RIID clearance, duly authenticated by ODI/RIID, if
photocopied;
f. Copy of Neuro-Psychiatric Clearance duly authenticated by NP Testing
Center, if photocopied;
g. Copy of Certificate of Attendance to a Gun Safety Seminar, duly validated
by Chief, Operations Branch, FED;
h. NBI Clearance;
i. Two (2) ID pictures (2 x 2) taken not earlier than one (1) year from date of
filing of application; and
j. Proof of Payment
7. Procedures:
a. Applications may be filed directly to the Office of the PTCFOR Secretariat
in Camp Crame. In the provinces, the applications may also be
submitted to the Police Regional Offices (PROs) and Provincial/City
Police Offices (P/CPOs) for initial processing before they are
forwarded to the office of the PTCFOR Secretariat. The processors,
after ascertaining that the documentary requirements are in order, shall
issue the Order of Payment (OP) indicating the amount of fees payable
by the applicant, who in turn shall pay the fees to the Land Bank.
b. Applications, which are duly processed and prepared in accordance with
existing rules and regulations, shall be forwarded to the OCPNP for
approval.
c. Upon approval of the application, OCPNP will issue PTCFOR valid for
one (1) year from date of issue.
d. Applications for renewal of PTCFOR shall be processed in accordance
with the provisions of par. 6 above.
e. Application for possession and carrying of firearms by diplomats in the
Philippines shall be processed in accordance with NHQ PNP Memo
dated September 25, 2000, with Subj: Possession and Carrying of
Firearms by Diplomats in the Philippines.
8. Restrictions in the Carrying of Firearms:
a. The firearm must not be displayed or exposed to public view, except
those authorized in uniform and in the performance of their official
duties.
b. The firearm shall not be brought inside public drinking and amusement
places, and all other commercial or public establishments.
Petitioner Francisco I. Chavez, a licensed gun owner to whom a PTCFOR has been
issued, requested the Department of Interior and Local Government (DILG) to reconsider the
implementation of the assailed Guidelines. However, his request was denied. Thus, he filed the
present petition impleading public respondents Ebdane, as Chief of PNP; Alberto G. Romulo, as
Executive Secretary; and Gerry L. Barias, as Chief of the PNP-Firearms and Explosives
Division. He anchored his petition on the following grounds:
I
THE PRESIDENT HAS NO POWER OR AUTHORITY MUCH LESS BY A MERE SPEECH TO
ALTER, MODIFY OR AMEND THE LAW ON FIREARMS BY IMPOSING A GUN BAN AND
CANCELING EXISTING PERMITS FOR GUNS TO BE CARRIED OUTSIDE RESIDENCES.
II
OFFICIALLY, THERE IS NO PRESIDENTIAL ISSUANCE ON THE GUN BAN; THE
PRESIDENTIAL SPEECH NEVER INVOKED POLICE POWER TO JUSTIFY THE GUN BAN;
THE PRESIDENTS VERBAL DECLARATION ON GUN BAN VIOLATED THE PEOPLES RIGHT
TO PROTECT LIFE AND THEIR PROPERTY RIGHT TO CARRY FIREARMS.
III
THE PNP CHIEF HAS NO POWER OR AUTHORITY TO ISSUE THE QUESTIONED
GUIDELINES BECAUSE:
1) THERE IS NO LAW, STATUTE OR EXECUTIVE ORDER WHICH GRANTS THE PNP CHIEF
THE AUTHORITY TO PROMULGATE THE PNP GUIDELINES.
2) THE IMPLEMENTING RULES AND REGULATIONS OF PD 1866 CANNOT BE THE
SUBJECT OF ANOTHER SET OF IMPLEMENTING GUIDELINES.
3) THE PRESIDENTS SPEECH CANNOT BE A BASIS FOR THE PROMULGATION OF
IMPLEMENTNG GUIDELINES ON THE GUN BAN.
IV
ASSUMING ARGUENDO, THAT THE PNP GUIDELINES IMPLEMENT PD 1866, AND THE
AMENDMENTS THERETO, THE PNP CHIEF STILL HAS NO POWER OR AUTHORITY TO
ISSUE THE SAME BECAUSE
1) PER SEC 6, RA 8294, WHICH AMENDS PD 1866, THE IRR SHALL BE
PROMULGATED JOINTLY BY THE DOJ AND THE DILG.
2) SEC. 8, PD 1866 STATES THAT THE IRR SHALL BE PROMULGATED BY THE CHIEF OF
THE PHILIPPINE CONSTABULARY.
V
THE PNP GUIDELINES VIOLATE THE DUE PROCESS CLAUSE OF THE CONSTITUTION
BECAUSE:
1) THE RIGHT TO OWN AND CARRY A FIREARM IS NECESSARILY INTERTWINED WITH
THE PEOPLES INHERENT RIGHT TO LIFE AND TO PROTECT LIFE. THUS, THE PNP
GUIDELINES DEPRIVE PETITIONER OF THIS RIGHT WITHOUT DUE PROCESS OF LAW
FOR:
A) THE PNP GUIDELINES DEPRIVE PETITIONER OF HIS MOST POTENT, IF NOT HIS
ONLY, MEANS TO DEFEND HIMSELF.
B) THE QUESTIONED GUIDELINES STRIPPED PETITIONER OF HIS MEANS OF
PROTECTION AGAINST CRIME DESPITE THE FACT THAT THE STATE COULD NOT
POSSIBLY PROTECT ITS CITIZENS DUE TO THE INADEQUACY AND INEFFICIENCY OF
THE POLICE FORCE.
2) THE OWNESHIP AND CARRYING OF FIREARMS ARE CONSTITUTIONALLY
PROTECTED PROPERTY RIGHTS WHICH CANNOT BE TAKEN AWAY WITHOUT DUE
PROCESS OF LAW AND WITHOUT JUST CAUSE.
VI
ASSUMING ARGUENDO, THAT THE PNP GUIDELINES WERE ISSUED IN THE EXERCISE
OF POLICE POWER, THE SAME IS AN INVALID EXERCISE THEREOF SINCE THE MEANS
USED THEREFOR ARE UNREASONABLE AND UNNCESSARY FOR THE
ACCOMPLISHMENT OF ITS PURPOSE TO DETER AND PREVENT CRIME THEREBY
BECOMING UNDULY OPPRESSIVE TO LAW-ABIDING GUN-OWNERS.
VII
THE PNP GUIDELINES ARE UNJUST, OPPRESSIVE AND CONFISCATORY SINCE IT
REVOKED ALL EXISTING PERMITS TO CARRY WITHOUT, HOWEVER, REFUNDING THE
PAYMENT THE PNP RECEIVED FROM THOSE WHO ALREADY PAID THEREFOR.
VIII
THE PNP GUIDELINES VIOLATE THE EQUAL PROTECTION CLAUSE OF THE
CONSTITUTION BECAUSE THEY ARE DIRECTED AT AND OPPRESSIVE ONLY TO LAW-
ABIDING GUN OWNERS WHILE LEAVING OTHER GUN-OWNERS THE LAWBREAKERS
(KIDNAPPERS, ROBBERS, HOLD-UPPERS, MNLF, MILF, ABU SAYYAF COLLECTIVELY,
AND NPA) UNTOUCHED.
IX
THE PNP GUIDELINES ARE UNJUST, OPPRESSIVE AND UNFAIR BECAUSE THEY WERE
IMPLEMENTED LONG BEFORE THEY WERE PUBLISHED.
X
THE PNP GUIDELINES ARE EFFECTIVELY AN EX POST FACTO LAW SINCE THEY APPLY
RETROACTIVELY AND PUNISH ALL THOSE WHO WERE ALREADY GRANTED PERMITS
TO CARRY OUTSIDE OF RESIDENCE LONG BEFORE THEIR PROMULGATION.
Petitioners submissions may be synthesized into five (5) major issues:
First, whether respondent Ebdane is authorized to issue the assailed Guidelines;
Second, whether the citizens right to bear arms is a constitutional right?;
Third, whether the revocation of petitioners PTCFOR pursuant to the assailed Guidelines is a
violation of his right to property?;
Fourth, whether the issuance of the assailed Guidelines is a valid exercise of police power?; and
Fifth, whether the assailed Guidelines constitute an ex post facto law?
 The Solicitor General seeks the dismissal of the petition pursuant to the doctrine of
hierarchy of courts. Nonetheless, in refutation of petitioners arguments, he contends that: (1) the
PNP Chief is authorized to issue the assailed Guidelines; (2) petitioner does not have a
constitutional right to own and carry firearms; (3) the assailed Guidelines do not violate the due
process clause of the Constitution; and (4) the assailed Guidelines do not constitute an ex post
facto law.
Initially, we must resolve the procedural barrier.
On the alleged breach of the doctrine of hierarchy of courts, suffice it to say that the
doctrine is not an iron-clad dictum. In several instances where this Court was confronted with
cases of national interest and of serious implications, it never hesitated to set aside the rule and
proceed with the judicial determination of the cases. [3] The case at bar is of similar import as it
involves the citizens right to bear arms.
I pursuant to the general power granted by P.D. No. 1866 empowering him to promulgate rules
Authority of the PNP Chief
Relying on the principle of separation of powers, petitioner argues that only Congress can
withhold his right to bear arms. In revoking all existing PTCFOR, President Arroyo and
respondent Ebdane transgressed the settled principle and arrogated upon themselves a power
they do not possess the legislative power.
We are not persuaded.
It is true that under our constitutional system, the powers of government are distributed
among three coordinate and substantially independent departments: the legislative, the
executive and the judiciary. Each has exclusive cognizance of the matters within its jurisdiction
and is supreme within its own sphere.[4]
Pertinently, the power to make laws the legislative power is vested in
Congress.[5] Congress may not escape its duties and responsibilities by delegating that power to
any other body or authority. Any attempt to abdicate the power is unconstitutional and void, on
the principle that delegata potestas non potest delegari delegated power may not be
delegated.[6]
The rule which forbids the delegation of legislative power, however, is not absolute
and inflexible. It admits of exceptions. An exception sanctioned by immemorial practice permits
the legislative body to delegate its licensing power to certain persons, municipal corporations,
towns, boards, councils, commissions, commissioners, auditors, bureaus and directors. [7] Such
licensing power includes the power to promulgate necessary rules and regulations.[8]
The evolution of our laws on firearms shows that since the early days of our Republic, the
legislatures tendency was always towards the delegation of power. Act No. 1780,[9] delegated
upon the Governor-General (now the President) the authority (1) to approve or disapprove
applications of any person for a license to deal in firearms or to possess the same for personal
protection, hunting and other lawful purposes; and (2) to revoke such license any
time.[10] Further, it authorized him to issue regulations which he may deem necessary for the
proper enforcement of the Act. [11] With the enactment of Act No. 2711, the Revised
Administrative Code of 1917, the laws on firearms were integrated. [12] The Act retained the
authority of the Governor General provided in Act No. 1780. Subsequently, the growing
complexity in the Office of the Governor-General resulted in the delegation of his authority to the
Chief of the Constabulary. On January 21, 1919, Acting Governor-General Charles E. Yeater
issued Executive Order No. 8[13] authorizing and directing the Chief of Constabulary to act on his
behalf in approving and disapproving applications for personal, special and hunting
licenses. This was followed by Executive Order No. 61[14] designating the Philippine
Constabulary (PC) as the government custodian of all firearms, ammunitions and
explosives. Executive Order No. 215,[15] issued by President Diosdado Macapagal on December
3, 1965, granted the Chief of the Constabulary, not only the authority to approve or disapprove
applications for personal, special and hunting license, but also the authority to revoke the
same. With the foregoing developments, it is accurate to say that the Chief of the Constabulary
had exercised the authority for a long time. In fact, subsequent issuances such as Sections 2
and 3 of the Implementing Rules and Regulations of Presidential Decree No. 1866 [16] perpetuate
such authority of the Chief of the Constabulary. Section 2 specifically provides that any person
or entity desiring to possess any firearm shall first secure the necessary
permit/license/authority from the Chief of the Constabulary. With regard to the issuance of
PTCFOR, Section 3 imparts: The Chief of Constabulary may, in meritorious cases as
determined by him and under such conditions as he may impose, authorize lawful
holders of firearms to carry them outside of residence. These provisions are issued
and regulations for the effective implementation of the decree.[17] At this juncture, it bears
emphasis that P.D. No. 1866 is the chief law governing possession of firearms in the Philippines
and that it was issued by President Ferdinand E. Marcos in the exercise of his legislative
power.[18]
In an attempt to evade the application of the above-mentioned laws and regulations,
petitioner argues that the Chief of the PNP is not the same as the Chief of the Constabulary, the
PC being a mere unit or component of the newly established PNP. He contends further that
Republic Act No. 8294[19] amended P.D. No. 1866 such that the authority to issue rules and
regulations regarding firearms is now jointly vested in the Department of Justice and the DILG,
not the Chief of the Constabulary.[20]
Petitioners submission is bereft of merit.
By virtue of Republic Act No. 6975,[21] the Philippine National Police (PNP) absorbed the
Philippine Constabulary (PC). Consequently, the PNP Chief succeeded the Chief of the
Constabulary and, therefore, assumed the latters licensing authority. Section 24 thereof
specifies, as one of PNPs powers, the issuance of licenses for the possession of firearms
and explosives in accordance with law.[22] This is in conjunction with the PNP Chiefs power to
issue detailed implementing policies and instructions on such matters as may be necessary to
effectively carry out the functions, powers and duties of the PNP.[23]
Contrary to petitioners contention, R.A. No. 8294 does not divest the Chief of the
Constabulary (now the PNP Chief) of his authority to promulgate rules and regulations for the
effective implementation of P.D. No. 1866. For one, R.A. No. 8294 did not repeal entirely P.D.
No. 1866. It merely provides for the reduction of penalties for illegal possession of
firearms. Thus, the provision of P.D. No. 1866 granting to the Chief of the Constabulary the
authority to issue rules and regulations regarding firearms remains effective. Correspondingly,
the Implementing Rules and Regulations dated September 15, 1997 jointly issued by the
Department of Justice and the DILG pursuant to Section 6 of R.A. No. 8294 deal only with the
automatic review, by the Director of the Bureau of Corrections or the Warden of a provincial or
city jail, of the records of convicts for violations of P.D. No. 1866. The Rules seek to give effect
to the beneficent provisions of R.A. No. 8294, thereby ensuring the early release and
reintegration of the convicts into the community.
Clearly, both P.D. No. 1866 and R.A. No. 6975 authorize the PNP Chief to issue the
assailed guidelines.
Corollarily, petitioner disputes President Arroyos declaration of a nationwide gun ban,
arguing that she has no authority to alter, modify, or amend the law on firearms through a mere
speech.
First, it must be emphasized that President Arroyos speech was just an expression of her
policy and a directive to her subordinate. It cannot, therefore, be argued that President Arroyo
enacted a law through a mere speech.
 Second, at the apex of the entire executive officialdom is the President. Section 17, Article
VII of the Constitution specifies his power as Chief Executive, thus: The President shall have
control of all the executive departments, bureaus and offices. He shall ensure that the
laws be faithfully executed. As Chief Executive, President Arroyo holds the steering wheel that
controls the course of her government. She lays down policies in the execution of her plans and
programs. Whatever policy she chooses, she has her subordinates to implement them. In short,
she has the power of control. Whenever a specific function is entrusted by law or regulation
to her subordinate, she may act directly or merely direct the performance of a
duty.[24] Thus, when President Arroyo directed respondent Ebdane to suspend the issuance of
PTCFOR, she was just directing a subordinate to perform an assigned duty. Such act is well
within the prerogative of her office.
II
Right to bear arms: Constitutional or Statutory?
Petitioner earnestly contends that his right to bear arms is a constitutionally-protected
right. This, he mainly anchors on various American authorities. We therefore find it imperative to
determine the nature of the right in light of American jurisprudence.
The bearing of arms is a tradition deeply rooted in the English and American society. It
antedates not only the American Constitution but also the discovery of firearms. [25]
A provision commonly invoked by the American people to justify their possession of
firearms is the Second Amendment of the Constitution of the United States of America, which
reads:
A well regulated militia, being necessary for the security of free state, the right of the people to
keep and bear Arms, shall not be infringed.
An examination of the historical background of the foregoing provision shows that it
pertains to the citizens collective right to take arms in defense of the State, not to the citizens
individual right to own and possess arms. The setting under which the right was contemplated
has a profound connection with the keeping and maintenance of a militia or an armed
citizenry. That this is how the right was construed is evident in early American cases.
The first case involving the interpretation of the Second Amendment that reached the
United States Supreme Court is United States vs. Miller.[26] Here, the indictment charged the
defendants with transporting an unregistered Stevens shotgun without the required stamped
written order, contrary to the National Firearms Act. The defendants filed a demurrer challenging
the facial validity of the indictment on the ground that the National Firearms Act offends the
inhibition of the Second Amendment. The District Court sustained the demurrer and quashed the
indictment. On appeal, the Supreme Court interpreted the right to bear arms under the
Second Amendment as referring to the collective right of those comprising the Militia a
body of citizens enrolled for military discipline. It does not pertain to the individual right
of citizen to bear arm. Miller expresses its holding as follows:
In the absence of any evidence tending to show that possession or use of a shotgun having a
barrel of less than eighteen inches in length at this time has some reasonable relationship to
the preservation or efficiency of a well regulated militia, we cannot say that the Second
Amendment guarantees the right to keep and bear such an instrument. Certainly it is not
within judicial notice that this weapon is any part of the ordinary military equipment or that its use
could contribute to the common defense.
The same doctrine was re-echoed in Cases vs. United States.[27] Here, the Circuit Court of
Appeals held that the Federal Firearms Act, as applied to appellant, does not conflict with the
Second Amendment. It ruled that:
While [appellants] weapon may be capable of military use, or while at least familiarity with it
might be regarded as of value in training a person to use a comparable weapon of military type
and caliber, still there is no evidence that the appellant was or ever had been a member of
any military organization or that his use of the weapon under the circumstances
disclosed was in preparation for a military career. In fact, the only inference possible is
that the appellant at the time charged in the indictment was in possession of,
transporting, and using the firearm and ammunition purely and simply on a frolic of his
own and without any thought or intention of contributing to the efficiency of the well
regulated militia which the Second amendment was designed to foster as necessary to
the security of a free state.
With the foregoing jurisprudence, it is erroneous to assume that the US Constitution grants
upon the American people the right to bear arms. In a more explicit language, the United States
vs. Cruikshank[28] decreed: The right of the people to keep and bear arms is not a right
granted by the Constitution. Neither is it in any way dependent upon that
instrument. Likewise, in People vs. Persce,[29] the Court of Appeals said: Neither is there any
constitutional provision securing the right to bear arms which prohibits legislation with reference
to such weapons as are specifically before us for consideration. The provision in the
Constitution of the United States that the right of the people to keep and bear arms shall
not be infringed is not designed to control legislation by the state.
With more reason, the right to bear arms cannot be classified as fundamental under the
1987 Philippine Constitution. Our Constitution contains no provision similar to the Second
Amendment, as we aptly observed in the early case of United States vs. Villareal:[30]
The only contention of counsel which would appear to necessitate comment is the claim that the
statute penalizing the carrying of concealed weapons and prohibiting the keeping and the use of
firearms without a license, is in violation of the provisions of section 5 of the Philippine Bill of
Rights.
Counsel does not expressly rely upon the prohibition in the United States Constitution
against the infringement of the right of the people of the United States to keep and bear
arms (U. S. Constitution, amendment 2), which is not included in the Philippine Bill. But it
may be well, in passing, to point out that in no event could this constitutional guaranty
have any bearing on the case at bar, not only because it has not been expressly extended
to the Philippine Islands, but also because it has been uniformly held that both this and
similar provisions in State constitutions apply only to arms used in civilized warfare (see
cases cited in 40 Cyc., 853, note 18); x x x.
Evidently, possession of firearms by the citizens in the Philippines is the exception,
not the rule. The right to bear arms is a mere statutory privilege, not a constitutional right. It is a
mere statutory creation. What then are the laws that grant such right to the Filipinos? The
first real firearm law is Act No. 1780 enacted by the Philippine Commission on October 12,
1907. It was passed to regulate the importation, acquisition, possession, use and transfer of
firearms. Section 9 thereof provides:
SECTION 9. Any person desiring to possess one or more firearms for personal
protection, or for use in hunting or other lawful purposes only, and ammunition therefor,
shall make application for a license to possess such firearm or firearms or ammunition as
hereinafter provided. Upon making such application, and before receiving the license, the
applicant shall make a cash deposit in the postal savings bank in the sum of one hundred pesos
for each firearm for which the license is to be issued, or in lieu thereof he may give a bond in
such form as the Governor-General may prescribe, payable to the Government of the Philippine
Islands, in the sum of two hundred pesos for each such firearm: PROVIDED, HOWEVER, That
persons who are actually members of gun clubs, duly formed and organized at the time of the
passage of this Act, who at such time have a license to possess firearms, shall not be required
to make the deposit or give the bond prescribed by this section, and the bond duly executed by
such person in accordance with existing law shall continue to be security for the safekeeping of
such arms.
The foregoing provision was restated in Section 887[31] of Act No. 2711 that integrated the
firearm laws. Thereafter, President Ferdinand E. Marcos issued P.D. No. 1866. It codified the
laws on illegal possession, manufacture, dealing in, acquisition of firearms, ammunitions or
explosives and imposed stiffer penalties for their violation. R.A. No. 8294 amended some of the
provisions of P.D. No. 1866 by reducing the imposable penalties. Being a mere statutory
creation, the right to bear arms cannot be considered an inalienable or absolute right.
III
Vested Property Right
Section 1, Article III of the Constitution provides that no person shall be deprived of life,
liberty or property without due process of law. Petitioner invokes this provision, asserting that the
revocation of his PTCFOR pursuant to the assailed Guidelines deprived him of his vested
property right without due process of law and in violation of the equal protection of law.
Petitioner cannot find solace to the above-quoted Constitutional provision.
In evaluating a due process claim, the first and foremost consideration must be whether
life, liberty or property interest exists.[32] The bulk of jurisprudence is that a license authorizing a
person to enjoy a certain privilege is neither a property nor property right. In Tan vs. The Director
of Forestry,[33] we ruled that a license is merely a permit or privilege to do what otherwise would
be unlawful, and is not a contract between the authority granting it and the person to whom it is
granted; neither is it property or a property right, nor does it create a vested right. In a
more emphatic pronouncement, we held in Oposa vs. Factoran, Jr.[34] that:
Needless to say, all licenses may thus be revoked or rescinded by executive action. It is
not a contract, property or a property right protected by the due process clause of the
Constitution.
Petitioner, in arguing that his PTCFOR is a constitutionally protected property right, relied
heavily on Bell vs. Burson[35] wherein the U.S. Supreme Court ruled that once a license is
issued, continued possession may become essential in the pursuit of livelihood. Suspension of
issued licenses thus involves state action that adjudicates important interest of the licensees.
Petitioners reliance on Bell is misplaced. This case involves a drivers license, not a license
to bear arms. The catena of American jurisprudence involving license to bear arms is perfectly in
accord with our ruling that a PTCFOR is neither a property nor a property right. In Erdelyi vs.
OBrien,[36] the plaintiff who was denied a license to carry a firearm brought suit against the
defendant who was the Chief of Police of the City of Manhattan Beach, on the ground that the
denial violated her constitutional rights to due process and equal protection of the laws. The
United States Court of Appeals Ninth Circuit ruled that Erdelyi did not have a property interest in
obtaining a license to carry a firearm, ratiocinating as follows:
Property interests protected by the Due Process Clause of the Fourteenth Amendment do
not arise whenever a person has only an abstract need or desire for, or unilateral
expectation of a benefit.x x x Rather, they arise from legitimate claims of entitlement
defined by existing rules or understanding that stem from an independent source, such
as state law. x x x
Concealed weapons are closely regulated by the State of California. x x x Whether the statute
creates a property interest in concealed weapons licenses depends largely upon the
extent to which the statute contains mandatory language that restricts the discretion of
the [issuing authority] to deny licenses to applicants who claim to meet the minimum
eligibility requirements. x x x Where state law gives the issuing authority broad discretion
to grant or deny license application in a closely regulated field, initial applicants do not
have a property right in such licenses protected by the Fourteenth Amendment. See
Jacobson, supra, 627 F.2d at 180 (gaming license under Nevada law);
Similar doctrine was announced in Potts vs. City of Philadelphia,[37] Conway vs.
King, Nichols vs. County of Sta. Clara,[39] and Gross vs. Norton.[40] These cases enunciated
[38]
that the test whether the statute creates a property right or interest depends largely on the extent
of discretion granted to the issuing authority.
In our jurisdiction, the PNP Chief is granted broad discretion in the issuance of
PTCFOR. This is evident from the tenor of the Implementing Rules and Regulations of P.D. No.
1866 which state that the Chief of Constabulary may, in meritorious cases as determined by
him and under such conditions as he may impose, authorize lawful holders of firearms to
carry them outside of residence. Following the American doctrine, it is indeed logical to say that
a PTCFOR does not constitute a property right protected under our Constitution.
Consequently, a PTCFOR, just like ordinary licenses in other regulated fields, may be
revoked any time. It does not confer an absolute right, but only a personal privilege to be
exercised under existing restrictions, and such as may thereafter be reasonably imposed. [41] A
licensee takes his license subject to such conditions as the Legislature sees fit to impose, and
one of the statutory conditions of this license is that it might be revoked by the selectmen at
their pleasure. Such a license is not a contract, and a revocation of it does not deprive the
defendant of any property, immunity, or privilege within the meaning of these words in
the Declaration of Rights.[42] The US Supreme Court, in Doyle vs. Continental Ins.
Co,[43]held: The correlative power to revoke or recall a permission is a necessary
consequence of the main power. A mere license by the State is always revocable.
The foregoing jurisprudence has been resonating in the Philippines as early as
1908. Thus, in The Government of the Philippine Islands vs. Amechazurra[44] we ruled:
x x x no private person is bound to keep arms. Whether he does or not is entirely optional with
himself, but if, for his own convenience or pleasure, he desires to possess arms, he must do so
upon such terms as the Government sees fit to impose, for the right to keep and bear arms is
not secured to him by law. The Government can impose upon him such terms as it pleases. If he
is not satisfied with the terms imposed, he should decline to accept them, but, if for the purpose
of securing possession of the arms he does agree to such conditions, he must fulfill them.
IV
Police Power
 At any rate, assuming that petitioners PTCFOR constitutes a property right protected by
the Constitution, the same cannot be considered as absolute as to be placed beyond the reach
of the States police power. All property in the state is held subject to its general regulations,
necessary to the common good and general welfare.
In a number of cases, we laid down the test to determine the validity of a police measure,
thus:
In Mekin vs. Wolfe,[48] an ex post facto law has been defined as one (a) which makes an
action done before the passing of the law and which was innocent when done criminal, and
punishes such action; or (b) which aggravates a crime or makes it greater than it was when
committed; or (c) which changes the punishment and inflicts a greater punishment than the law
annexed to the crime when it was committed; or (d) which alters the legal rules of evidence and
receives less or different testimony than the law required at the time of the commission of the
offense in order to convict the defendant.

We see no reason to devote much discussion on the matter. Ex post facto law prohibits
(1) The interests of the public generally, as distinguished from those of a particular class, require
retrospectivity of penal laws.[49] The assailed Guidelines cannot be considered as an ex post
the exercise of the police power; and
facto law because it is prospective in its application. Contrary to petitioners argument, it would
not result in the punishment of acts previously committed.
(2) The means employed are reasonably necessary for the accomplishment of the purpose and
not unduly oppressive upon individuals. WHEREFORE, the petition is hereby DISMISSED.

SO ORDERED.
Deeper reflection will reveal that the test merely reiterates the essence of the
constitutional guarantees of substantive due process, equal protection, and non-impairment of Davide, Jr., C.J., Puno, Vitug, Panganiban, Quisumbing, Ynares-Santiago, Carpio,
property rights. Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr., Azcuna, and Tinga, JJ., concur.

It is apparent from the assailed Guidelines that the basis for its issuance was the need for
peace and order in the society. Owing to the proliferation of crimes, particularly those committed
by the New Peoples Army (NPA), which tends to disturb the peace of the community, President
Arroyo deemed it best to impose a nationwide gun ban. Undeniably, the motivating factor in the
issuance of the assailed Guidelines is the interest of the public in general.

The only question that can then arise is whether the means employed are appropriate and
reasonably necessary for the accomplishment of the purpose and are not unduly oppressive.In
the instant case, the assailed Guidelines do not entirely prohibit possession of firearms. What
they proscribe is merely the carrying of firearms outside of residence. However, those who wish
to carry their firearms outside of their residences may re-apply for a new PTCFOR. This we
believe is a reasonable regulation. If the carrying of firearms is regulated, necessarily, crime
incidents will be curtailed. Criminals carry their weapon to hunt for their victims; they do not wait
in the comfort of their homes. With the revocation of all PTCFOR, it would be difficult for
criminals to roam around with their guns. On the other hand, it would be easier for the PNP to
apprehend them.

Notably, laws regulating the acquisition or possession of guns have frequently been
upheld as reasonable exercise of the police power. [45] In State vs. Reams,[46] it was held that the
legislature may regulate the right to bear arms in a manner conducive to the public peace. With
the promotion of public peace as its objective and the revocation of all PTCFOR as the means,
we are convinced that the issuance of the assailed Guidelines constitutes a reasonable exercise
of police power. The ruling in United States vs. Villareal,[47] is relevant, thus:

We think there can be no question as to the reasonableness of a statutory regulation prohibiting

the carrying of concealed weapons as a police measure well calculated to restrict the too
frequent resort to such weapons in moments of anger and excitement. We do not doubt that the
strict enforcement of such a regulation would tend to increase the security of life and limb, and to
suppress crime and lawlessness, in any community wherein the practice of carrying concealed
weapons prevails, and this without being unduly oppressive upon the individual owners of these
weapons. It follows that its enactment by the legislature is a proper and legitimate exercise of the
police power of the state.

Ex post facto law

G.R. No. L-45127 May 5, 1989 being solely left to the discretion of the court as if the latter were the legislative department of the
Government.
PEOPLE OF THE PHILIPPINES, represented by the Provincial Fiscal of Leyte, petitioner,
vs. On March 30, 1976, having been advised that the petition of herein private respondents was
HON. JUDGE AUXENCIO C. DACUYCUY, CELESTINO S. MATONDO, SEGUNDINO A, related to Criminal Case No. 1978 for violation of Presidential Decree No. 442 previously
CAVAL and CIRILO M. ZANORIA, respondents. transferred from Branch VIII to Branch IV of the erstwhile Court of First Instance of Leyte, Judge
Fortunate B. Cuna of the former branch transferred the said petition to the latter branch for
further proceedings and where it was subsequently docketed therein as Civil Case No.
The Office of the Solicitor General for petitioner.
5428. 8 On March 15, 1976, the petitioner herein filed an opposition to the admission of the said
amended petitions 9 but respondent judge denied the same in his resolution of April 20,
Adelino B. Sitoy for private respondents. 1976. 10 On August 2, 1976, herein petitioner filed a supplementary memorandum in answer to
the amended petition. 11

On September 8, 1976, respondent judge rendered the aforecited challenged decision holding in
substance that Republic Act No. 4670 is valid and constitutional but cases for its violation fall
REGALADO, J.:
outside of the jurisdiction of municipal and city courts, and remanding the case to the former
Municipal Court of Hindang, Leyte only for preliminary investigation.
Involved in this special civil action is the unique situation, to use an euphemistic phrase, of an
alternative penal sanction of imprisonment imposed by law but without a specification as to the As earlier stated, on September 25, 1976, petitioner filed a motion for
term or duration thereof.
reconsideration. 12 Likewise, private respondents filed a motion for reconsideration of the lower
court's decision but the same was limited only to the portion thereof which sustains the validity of
As a consequence of such legislative faux pas or oversight, the petition at bar seeks to set aside Section 32 of Republic Act No. 4670. 13 Respondent judge denied both motions for
the decision of the then Court of First Instance of Leyte, Branch IV, dated September reconsideration in a resolution dated October 19, 1976. 14
8,1976, 1 penned by herein respondent judge and granting the petition for certiorari and
prohibition with preliminary injunction filed by herein private respondents and docketed therein The instant petition to review the decision of respondent judge poses the following questions of
as Civil Case No. 5428, as well as his resolution of October 19, 1976 2 denying the motions for
law: (1) Whether the municipal and city courts have jurisdiction over violations of Republic Act
reconsideration filed by the parties therein. Subject of said decision were the issues on No. 4670; and (2) Whether Section 32 of said Republic Act No. 4670 is constitutional.
jurisdiction over violations of Republic Act No. 4670, otherwise known as the Magna Carta for
Public School Teachers, and the constitutionality of Section 32 thereof.
We shall resolve said queries in inverse order, since prior determination of the constitutionality of
the assailed provision of the law involved is necessary for the adjudication of the jurisdictional
In a complaint filed by the Chief of Police of Hindang, Leyte on April 4, 1975, herein private issue raised in this petition.
respondents Celestino S. Matondo, Segundino A. Caval and Cirilo M. Zanoria, public school
officials of Leyte, were charged before the Municipal Court of Hindang, Leyte in Criminal Case
No. 555 thereof for violation of Republic Act No. 4670. The case was set for arraignment and 1. The disputed section of Republic Act No. 4670 provides:
trial on May 29, 1975. At the arraignment, the herein private respondents, as the accused
therein, pleaded not guilty to the charge. Immediately thereafter, they orally moved to quash the
Sec. 32. Penal Provision. A person who shall wilfully interfere with,
complaint for lack of jurisdiction over the offense allegedly due to the correctional nature of the
restrain or coerce any teacher in the exercise of his rights guaranteed by
penalty of imprisonment prescribed for the offense. The motion to quash was subsequently
this Act or who shall in any other manner commit any act to defeat any of
reduced to writing on June 13, 1975. 3 On August 21, 1975, the municipal court denied the
the provisions of this Act shall, upon conviction, be punished by a fine of not
motion to quash for lack of merit. 4 On September 2, 1975, private respondents filed a motion for
less than one hundred pesos nor more than one thousand pesos, or by
the reconsideration of the aforesaid denial order on the same ground of lack of jurisdiction, but
imprisonment, in the discretion of the court. (Emphasis supplied).
with the further allegation that the facts charged do not constitute an offense considering that
Section 32 of Republic Act No. 4670 is null and void for being unconstitutional. In an undated
order received by the counsel for private respondents on October 20,1975, the motion for Two alternative and distinct penalties are consequently imposed, to wit: (a) a fine ranging from
reconsideration was denied. 5 P100.00 to P1,000.00; or (b) imprisonment. It is apparent that the law has no prescribed period
or term for the imposable penalty of imprisonment. While a minimum and maximum amount for
the penalty of fine is specified, there is no equivalent provision for the penalty of imprisonment,
On October 26, 1975, private respondents filed a petitions 6 for certiorari and prohibition with
although both appear to be qualified by the phrase "in the discretion of the court.
preliminary injunction before the former Court of First Instance of Leyte, Branch VIII, where it
was docketed as Civil Case No. B-622, to restrain the Municipal Judge, Provincial Fiscal and
Chief of Police of Hindang, Leyte from proceeding with the trial of said Criminal Case No. 555 Private respondents contend that a judicial determination of what Congress intended to be the
upon the ground that the former Municipal Court of Hindang had no jurisdiction over the offense duration of the penalty of imprisonment would be violative of the constitutional prohibition against
charged. Subsequently, an amended petition 7 alleged the additional ground that the facts undue delegation of legislative power, and that the absence of a provision on the specific term of
charged do not constitute an offense since the penal provision, which is Section 32 of said law, imprisonment constitutes that penalty into a cruel and unusual form of punishment. Hence, it is
is unconstitutional for the following reasons: (1) It imposes a cruel and unusual punishment, the vigorously asserted, said Section 32 is unconstitutional.
term of imprisonment being unfixed and may run to reclusion perpetua; and (2) It also
constitutes an undue delegation of legislative power, the duration of the penalty of imprisonment
The basic principle underlying the entire field of legal concepts pertaining to the validity of
legislation is that in the enactment of legislation a constitutional measure is thereby created. In
every case where a question is raised as to the constitutionality of an act, the court employs this
doctrine in scrutinizing the terms of the law. In a great volume of cases, the courts have
enunciated the fundamental rule that there is a presumption in favor of the constitutionality of a
legislative enactment. 15
It is contended that Republic Act No. 4670 is unconstitutional on the ground that the imposable
but indefinite penalty of imprisonment provided therein constitutes a cruel and unusual
punishment, in defiance of the express mandate of the Constitution. This contention is
inaccurate and should be rejected.
We note with approval the holding of respondent judge that
The rule is established beyond question that a punishment authorized by
statute is not cruel or unusual or disproportionate to the nature of the
offense unless it is a barbarous one unknown to the law or so wholly
disproportionate to the nature of the offense as to shock the moral sense of
the community. Based on the principle, our Supreme Court has consistently
overruled contentions of the defense that the punishment of fine or
imprisonment authorized by the statute involved is cruel and unusual.
(Legarda vs. Valdez, 1 Phil. 146; U.S. vs. Pico, 18 Phil. 386; People vs.
Garay, 2 ACR 149; People vs. Estoista 93 Phil. 647; People vs. Tiu Ua. 96
Phil. 738; People vs. Dionisio, 22 SCRA 1299). The language of our
Supreme Court in the first of the cases it decided after the last world war is
appropriate here:
The Constitution directs that 'Excessive fines shall not
be imposed, nor cruel and unusual punishment
inflicted.' The prohibition of cruel and unusual
punishments is generally aimed at the form or character
of the punishment rather than its severity in respect of
duration or amount, and apply to punishments which
never existed in America, or which public sentiment has
regarded as cruel or obsolete (15 Am. Jur., p. 172), for
instance there (sic) inflicted at the whipping post, or in
the pillory, burning at the stake, breaking on the wheel,
disemboweling, and the like (15 Am. Jur. Supra, Note
35 L.R.A. p. 561). Fine and imprisonment would not
thus be within the prohibition.' (People vs. de la Cruz,
92 Phil. 906). 16
The question that should be asked, further, is whether the constitutional prohibition looks only to
the form or nature of the penalty and not to the proportion between the penalty and the crime.
The answer thereto may be gathered from the pronouncement in People vs. Estoista, 17 where
an "excessive" penalty was upheld as constitutional and was imposed but with a
recommendation for executive clemency, thus:
... If imprisonment from 5 to 10 years is out of proportion to the present case
in view of certain circumstances, the law is not to be declared
unconstitutional for this reason. The constitutionality of an act of the
legislature is not to be judged in the light of exceptional cases. Small
transgressors for which the heavy net was not spread are, like small fishes,
bound to be caught, and it is to meet such a situation as this that courts are
advised to make a recommendation to the Chief Executive for clemency or
reduction of the penalty...
That the penalty is grossly disproportionate to the crime is an insufficient basis to declare the law
unconstitutional on the ground that it is cruel and unusual. The fact that the punishment
authorized by the statute is severe does not make it cruel or unusual. 18 In addition, what degree
of disproportion the Court will consider as obnoxious to the Constitution has still to await
appropriate determination in due time since, to the credit of our legislative bodies, no decision
has as yet struck down a penalty for being "cruel and unusual" or "excessive."
We turn now to the argument of private respondents that the entire penal provision in question
should be invalidated as an 49 "undue delegation of legislative power, the duration of penalty of
imprisonment being solely left to the discretion of the court as if the lattter were the legislative
department of the government."
Petitioner counters that the discretion granted therein by the legislature to the courts to
determine the period of imprisonment is a matter of statutory construction and not an undue
delegation of legislative power. It is contended that the prohibition against undue delegation of
legislative power is concerned only with the delegation of power to make laws and not to
interpret the same. It is also submitted that Republic Act No. 4670 vests in the courts the
discretion, not to fix the period of imprisonment, but to choose which of the alternative penalties
shall be imposed.
Respondent judge sustained these theses of petitioner on his theory that "the principle of
separation of powers is not violated by vesting in courts discretion as to the length of sentence
or amount of fine between designated limits in sentencing persons convicted of crime. In such
instance, the exercise of judicial discretion by the courts is not an attempt to use legislative
power or to prescribe and create a law but is an instance of the administration of justice and the
application of existing laws to the facts of particular cases." 19 What respondent judge obviously
overlooked is his own reference to penalties "between designated limits."
In his commentary on the Constitution of the United States, Corwin wrote:
.. At least three distinct ideas have contributed to the development of the
principle that legislative power cannot be delegated. One is the doctrine of
separation of powers: Why go to the trouble of separating the three powers
of government if they can straightway remerge on their own motion? The
second is the concept of due process of laws which precludes the transfer
of regulatory functions to private persons. Lastly, there is the maxim of
agency "Delegata potestas non potest delegari." 20
An apparent exception to the general rule forbidding the delegation of legislative authority to the
courts exists in cases where discretion is conferred upon said courts. It is clear, however, that
when the courts are said to exercise a discretion, it must be a mere legal discretion which is
exercised in discerning the course prescribed by law and which, when discerned, it is the duty of
the court to follow. 21
So it was held by the Supreme Court of the United States that the principle of separation of
powers is not violated by vesting in courts discretion as to the length of sentence or the amount
of fine between designated limits in sentencing persons convicted of a crime. 22
In the case under consideration, the respondent judge erronneously assumed that since the
penalty of imprisonment has been provided for by the legislature, the court is endowed with the
discretion to ascertain the term or period of imprisonment. We cannot agree with this postulate.
It is not for the courts to fix the term of imprisonment where no points of reference have been
provided by the legislature. What valid delegation presupposes and sanctions is an exercise of
discretion to fix the length of service of a term of imprisonment which must be encompassed
within specific or designated limits provided by law, the absence of which designated limits well
constitute such exercise as an undue delegation, if not-an outright intrusion into or assumption,
of legislative power.

Section 32 of Republic Act No. 4670 provides for an indeterminable period of imprisonment, with
neither a minimum nor a maximum duration having been set by the legislative authority. The
courts are thus given a wide latitude of discretion to fix the term of imprisonment, without even
the benefit of any sufficient standard, such that the duration thereof may range, in the words of
respondent judge, from one minute to the life span of the accused. Irremissibly, this cannot be
allowed. It vests in the courts a power and a duty essentially legislative in nature and which, as
applied to this case, does violence to the rules on separation of powers as well as the non-
delegability of legislative powers. This time, the preumption of constitutionality has to yield.

On the foregoing considerations, and by virtue of the separability clause in Section 34 of

Republic Act No. 4670, the penalty of imprisonment provided in Section 32 thereof should be, as
it is hereby, declared unconstitutional.

It follows, therefore, that a ruling on the proper interpretation of the actual term of imprisonment,
as may have been intended by Congress, would be pointless and academic. It is, however,
worth mentioning that the suggested application of the so-called rule or principle of parallelism,
whereby a fine of P1,000.00 would be equated with one year of imprisonment, does not merit
judicial acceptance. A fine, whether imposed as a single or as an alternative penalty, should not
and cannot be reduced or converted into a prison term; it is to be considered as a separate and
independent penalty consonant with Article 26 of the Revised Penal Code. 23 It is likewise
declared a discrete principal penalty in the graduated scales of penalties in Article 71 of said
Code. There is no rule for transmutation of the amount of a fine into a term of imprisonment.
Neither does the Code contain any provision that a fine when imposed in conjunction with
imprisonment is subordinate to the latter penalty. In sum, a fine is as much a principal penalty as
imprisonment. Neither is subordinate to the other. 24

2. It has been the consistent rule that the criminal jurisdiction of the court is determined by the
statute in force at the time of the commencement of the action. 25

With the deletion by invalidation of the provision on imprisonment in Section 32 of Republic Act
No. 4670, as earlier discussed, the imposable penalty for violations of said law should be limited
to a fine of not less than P100.00 and not more than P1,000.00, the same to serve as the basis
in determining which court may properly exercise jurisdiction thereover. When the complaint
against private respondents was filed in 1975, the pertinent law then in force was Republic Act
No. 296, as amended by Republic Act No. 3828, under which crimes punishable by a fine of not
more than P 3,000.00 fall under the original jurisdiction of the former municipal courts.
Consequently, Criminal Case No. 555 against herein private respondents falls within the original
jurisdiction of the Municipal Trial Court of Hindang, Leyte.

WHEREFORE, the decision and resolution of respondent judge are hereby REVERSED and
SET ASIDE. Criminal Case No. 555 filed against private respondents herein is hereby ordered to
be remanded to the Municipal Trial Court of Hindang, Leyte for trial on the merits.

SO ORDERED.
 RA [No.] 9335 was enacted to optimize the revenue-generation
BUREAU OF CUSTOMS EMPLOYEES ASSOCIATION G.R. No. 181704
capability and collection of the Bureau of Internal Revenue (BIR) and the
(BOCEA), represented by its National President (BOCEA
Bureau of Customs (BOC). The law intends to encourage BIR and BOC
National Executive Council) Mr. Romulo A. Pagulayan,
Present: officials and employees to exceed their revenue targets by providing a
Petitioner, system of rewards and sanctions through the creation of a Rewards and
CORONA,C.J., Incentives Fund (Fund) and a Revenue Performance Evaluation Board
CARPIO, (Board). It covers all officials and employees of the BIR and the BOC with at
VELASCO, JR.,* least six months of service, regardless of employment status.
LEONARDO-DE CASTRO,
- versus - BRION, The Fund is sourced from the collection of the BIR and the BOC
PERALTA, in excess of their revenue targets for the year, as determined by the
BERSAMIN, Development Budget and Coordinating Committee (DBCC). Any incentive
DEL CASTILLO, or reward is taken from the fund and allocated to the BIR and the BOC in
HON. MARGARITO B. TEVES, in his capacity as Secretary ABAD, proportion to their contribution in the excess collection of the targeted
of the Department of Finance, HON. NAPOLEON L. VILLARAMA, JR., amount of tax revenue.
MORALES, in his capacity as Commissioner of the PEREZ,
Bureau of Customs, HON. LILIAN B. HEFTI, in her MENDOZA,
The Boards in the BIR and the BOC are composed of the
capacity as Commissioner of the Bureau of Internal SERENO,
Secretary of the Department of Finance (DOF) or his/her Undersecretary,
Revenue, REYES, and
the Secretary of the Department of Budget and Management (DBM) or
Respondents. PERLAS-BERNABE, JJ.
his/her Undersecretary, the Director General of the National Economic
Development Authority (NEDA) or his/her Deputy Director General, the
Commissioners of the BIR and the BOC or their Deputy Commissioners,
two representatives from the rank-and-file employees and a representative
from the officials nominated by their recognized organization.
Promulgated:

Each Board has the duty to (1) prescribe the rules and guidelines
December 6, 2011 for the allocation, distribution and release of the Fund; (2) set criteria and
procedures for removing from the service officials and employees whose
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x revenue collection falls short of the target; (3) terminate personnel in
accordance with the criteria adopted by the Board; (4) prescribe a system
for performance evaluation; (5) perform other functions, including the
DECISION issuance of rules and regulations and (6) submit an annual report to
Congress.
VILLARAMA, JR., J.:
The DOF, DBM, NEDA, BIR, BOC and the Civil Service Commission (CSC)
were tasked to promulgate and issue the implementing rules and
regulations of RA [No.] 9335, to be approved by a Joint Congressional
Oversight Committee created for such purpose.[5]
Before this Court is a petition[1] for certiorari and prohibition with prayer for injunctive

relief/s under Rule 65 of the 1997 Rules of Civil Procedure, as amended, to declare Republic Act

(R.A.) No. 9335,[2] otherwise known as the Attrition Act of 2005, and its Implementing Rules and The Joint Congressional Oversight Committee approved the assailed IRR on May 22,
[3]
Regulations (IRR) unconstitutional, and the implementation thereof be enjoined permanently. 2006. Subsequently, the IRR was published on May 30, 2006 in two newspapers of general

circulation, the Philippine Star and the Manila Standard, and became effective fifteen (15) days

The Facts later.[6]

On January 25, 2005, former President Gloria Macapagal-Arroyo signed into law R.A. No. 9335 Contending that the enactment and implementation of R.A. No. 9335 are tainted with

which took effect on February 11, 2005. constitutional infirmities in violation of the fundamental rights of its members, petitioner Bureau of

Customs Employees Association (BOCEA), an association of rank-and-file employees of the

In Abakada Guro Party List v. Purisima[4] (Abakada), we said of R.A. No. 9335:
Bureau of Customs (BOC), duly registered with the Department of Labor and Employment
(DOLE) and the Civil Service Commission (CSC), and represented by its National President, Mr.

Romulo A. Pagulayan (Pagulayan), directly filed the present petition before this Court against x x x x[8]

respondents Margarito B. Teves, in his capacity as Secretary of the Department of Finance

(DOF), Commissioner Napoleon L. Morales (Commissioner Morales), in his capacity as BOC

Commissioner, and Lilian B. Hefti, in her capacity as Commissioner of the Bureau of Internal BOCEA opined that the revenue target was impossible to meet due to the

Revenue (BIR). In its petition, BOCEA made the following averments: Governments own policies on reduced tariff rates and tax breaks to big businesses, the

occurrence of natural calamities and because of other economic factors. BOCEA claimed that

Sometime in 2008, high-ranking officials of the BOC pursuant to the mandate of R.A. No. 9335 some BOC employees were coerced and forced to sign the Performance Contract. The majority

and its IRR, and in order to comply with the stringent deadlines thereof, started to disseminate of them, however, did not sign. In particular, officers of BOCEA were summoned and required to

Collection District Performance Contracts[7] (Performance Contracts) for the lower ranking sign the Performance Contracts but they also refused. To ease the brewing tension, BOCEA

officials and rank-and-file employees to sign. The Performance Contract pertinently provided: claimed that its officers sent letters, and sought several dialogues with BOC officials but the

latter refused to heed them.

xxxx

WHEREAS, pursuant to the provisions of Sec. 25 (b) of the Implementing

Rules and Regulations (IRR) of the Attrition Act of 2005, that provides for
the setting of criteria and procedures for removing from the service Officials
and Employees whose revenue collection fall short of the target in
accordance with Section 7 of Republic Act 9335.
In addition, BOCEA alleged that Commissioner Morales exerted heavy pressure on
the District Collectors, Chiefs of Formal Entry Divisions, Principal Customs Appraisers and
Principal Customs Examiners of the BOC during command conferences to make them sign their

Performance Contracts. Likewise, BOC Deputy Commissioner Reynaldo Umali (Deputy

xxxx
Commissioner Umali) individually spoke to said personnel to convince them to sign said
NOW, THEREFORE, for and in consideration of the foregoing premises,
parties unto this Agreement hereby agree and so agreed to perform the contracts. Said personnel were threatened that if they do not sign their respective Performance
following:
Contracts, they would face possible reassignment, reshuffling, or worse, be placed on floating
xxxx status. Thus, all the District Collectors, except a certain Atty. Carlos So of the Collection District

III of the Ninoy Aquino International Airport (NAIA), signed the Performance Contracts.
2. The Section 2, PA/PE hereby accepts the allocated Revenue Collection
Target and further accepts/commits to meet the said target under the
following conditions:
BOCEA further claimed that Pagulayan was constantly harassed and threatened with
a.) That he/she will meet the allocated Revenue Collection Target
lawsuits. Pagulayan approached Deputy Commissioner Umali to ask the BOC officials to stop all
and thereby undertakes and binds himself/herself that in the event the
revenue collection falls short of the target with due consideration of all forms of harassment, but the latter merely said that he would look into the matter. On February
relevant factors affecting the level of collection as provided in the
rules and regulations promulgated under the Act and its IRR, he/she 5, 2008, BOCEA through counsel wrote the Revenue Performance Evaluation Board (Board) to
will voluntarily submit to the provisions of Sec. 25 (b) of the IRR and
Sec. 7 of the Act; and desist from implementing R.A. No. 9335 and its IRR and from requiring rank-and-file employees

b.) That he/she will cascade and/or allocate to respective of the BOC and BIR to sign Performance Contracts.[9] In his letter-reply[10] dated February 12,
Appraisers/Examiners or Employees under his/her section the said 2008, Deputy Commissioner Umali denied having coerced any BOC employee to sign a
Revenue Collection Target and require them to execute a Performance
Contract, and direct them to accept their individual target. The Performance Performance Contract. He also defended the BOC, invoking its mandate of merely implementing
Contract executed by the respective Examiners/Appraisers/Employees shall
be submitted to the Office of the Commissioner through the LAIC on or the law. Finally, Pagulayan and BOCEAs counsel, on separate occasions, requested for a
before March 31, 2008.
certified true copy of the Performance Contract from Deputy Commissioner Umali but the latter with Abakada on April 16, 2008. However, pending action on said motion, the Court rendered its
[11]
failed to furnish them a copy. decision in Abakada on August 14, 2008. Thus, the consolidation of this case with Abakada was

rendered no longer possible.[16]

This petition was filed directly with this Court on March 3, 2008. BOCEA asserted that in view of

the unconstitutionality of R.A. No. 9335 and its IRR, and their adverse effects on the
constitutional rights of BOC officials and employees, direct resort to this Court is justified.
BOCEA argued, among others, that its members and other BOC employees are in great danger
of losing their jobs should they fail to meet the required quota provided under the law, in clear
violation of their constitutional right to security of tenure, and at their and their respective families
prejudice.
In Abakada, this Court, through then Associate Justice, now Chief Justice Renato C.
Corona, declared Section 12[17] of R.A. No. 9335 creating a Joint Congressional Oversight
Committee to approve the IRR as unconstitutional and violative of the principle of separation of
powers. However, the constitutionality of the remaining provisions of R.A. No. 9335 was upheld
pursuant to Section 13[18] of R.A. No. 9335. The Court also held that until the contrary is shown,
the IRR of R.A. No. 9335 is presumed valid and effective even without the approval of the Joint

Congressional Oversight Committee.[19]

[12]
In their Comment, respondents, through the Office of the Solicitor General (OSG), countered

that R.A. No. 9335 and its IRR do not violate the right to due process and right to security of Notwithstanding our ruling in Abakada, both parties complied with our
tenure of BIR and BOC employees. The OSG stressed that the guarantee of security of tenure Resolution[20]
dated February 10, 2009, requiring them to submit their respective Memoranda.
under the 1987 Constitution is not a guarantee of perpetual employment. R.A. No. 9335 and its

IRR provided a reasonable and valid ground for the dismissal of an employee which is germane

to the purpose of the law. Likewise, R.A. No. 9335 and its IRR provided that an employee may The Issues

only be separated from the service upon compliance with substantive and procedural due
BOCEA raises the following issues:
process. The OSG added that R.A. No. 9335 and its IRR must enjoy the presumption of

constitutionality.
I.

WHETHER OR NOT THE ATTRITION LAW, REPUBLIC ACT [NO.] 9335,

In its Reply,[13] BOCEA claimed that R.A. No. 9335 employs means that are unreasonable to AND ITS IMPLEMENTING RULES AND REGULATIONS ARE
achieve its stated objectives; that the law is unduly oppressive of BIR and BOC employees as it UNCONSTITUTIONAL AS THESE VIOLATE THE RIGHT TO DUE
PROCESS OF THE COVERED BIR AND BOC OFFICIALS AND
shifts the extreme burden upon their shoulders when the Government itself has adopted EMPLOYEES[;]

measures that make collection difficult such as reduced tariff rates to almost zero percent and II.
tax exemption of big businesses; and that the law is discriminatory of BIR and BOC employees. WHETHER OR NOT THE ATTRITION LAW, REPUBLIC ACT [NO.] 9335,
AND ITS IMPLEMENTING RULES AND REGULATIONS ARE
BOCEA manifested that only the high-ranking officials of the BOC benefited largely from the
UNCONSTITUTIONAL AS THESE VIOLATE THE RIGHT OF BIR AND
reward system under R.A. No. 9335 despite the fact that they were not the ones directly toiling to BOC OFFICIALS AND EMPLOYEES TO THE EQUAL PROTECTION OF
THE LAWS[;]
collect revenue. Moreover, despite the BOCEAs numerous requests, [14] BOC continually refused
III.
to provide BOCEA the Expenditure Plan on how such reward was distributed.
WHETHER OR NOT REPUBLIC ACT [NO.] 9335 AND ITS
IMPLEMENTING RULES AND REGULATIONS VIOLATE THE RIGHT TO
Since BOCEA was seeking similar reliefs as that of the petitioners in Abakada Guro SECURITY OF TENURE OF BIR AND BOC OFFICIALS AND
EMPLOYEES AS ENSHRINED UNDER SECTION 2 (3), ARTICLE IX (B)
Party List v. Purisima, BOCEA filed a Motion to Consolidate[15] the present case OF THE CONSTITUTION[;]
 IV.
WHETHER OR NOT REPUBLIC ACT [NO.] 9335 AND ITS
IMPLEMENTING RULES AND REGULATIONS ARE
UNCONSTITUTIONAL AS THEY CONSTITUTE UNDUE DELEGATION OF
LEGISLATIVE POWERS TO THE REVENUE PERFORMANCE
EVALUATION BOARD IN VIOLATION OF THE PRINCIPLE OF
SEPARATION OF POWERS ENSHRINED IN THE CONSTITUTION[; AND]
V.
WHETHER OR NOT REPUBLIC ACT [NO.] 9335 IS A BILL OF
ATTAINDER AND HENCE[,] UNCONSTITUTIONAL BECAUSE IT
INFLICTS PUNISHMENT THROUGH LEGISLATIVE FIAT UPON A
PARTICULAR GROUP OR CLASS OF OFFICIALS AND EMPLOYEES
WITHOUT TRIAL.[21]
BOCEA manifested that while waiting for the Court to give due course to its petition, events
unfolded showing the patent unconstitutionality of R.A. No. 9335. It narrated that during the first
year of the implementation of R.A. No. 9335, BOC employees exerted commendable efforts to
attain their revenue target of P196 billion which they surpassed by as much as P2 billion for that
year alone. However, this was attained only because oil companies made advance tax
payments to BOC. Moreover, BOC employees were given their reward for surpassing said target
only in 2008, the distribution of which they described as unjust, unfair, dubious and fraudulent
because only top officials of BOC got the huge sum of reward while the employees, who did the
hard task of collecting, received a mere pittance of around P8,500.00. In the same manner, the
Bonds Division of BOC-NAIA collected 400+% of its designated target but the higher
management gave out to the employees a measly sum of P8,500.00 while the top level officials
partook of millions of the excess collections. BOCEA relies on a piece of information revealed by
a newspaper showing the list of BOC officials who apparently earned huge amounts of money
by way of reward.[22] It claims that the recipients thereof included lawyers, support personnel and
other employees, including a dentist, who performed no collection functions at all. These alleged
anomalous selection, distribution and allocation of rewards was due to the failure of R.A. No.
9335 to set out clear guidelines.[23]
In addition, BOCEA avers that the Board initiated the first few cases of attrition for the Fiscal
Year 2007 by subjecting five BOC officials from the Port of Manila to attrition despite the fact that
the Port of Manila substantially complied with the provisions of R.A. No. 9335. It is thus
submitted that the selection of these officials for attrition without proper investigation was nothing
less than arbitrary. Further, the legislative and executive departments promulgation of issuances
and the Governments accession to regional trade agreements have caused a significant
diminution of the tariff rates, thus, decreasing over-all collection. These unrealistic settings of
revenue targets seriously affect BIR and BOC employees tasked with the burden of collection,
and worse, subjected them to attrition.[24]
BOCEA assails the constitutionality of R.A. No. 9335 and its IRR on the following grounds:
1. R.A. No. 9335 and its IRR violate the BIR and BOC employees right to
due process because the termination of employees who had not
attained their revenue targets for the year is peremptory and done
without any form of hearing to allow said employees to ventilate their
side. Moreover, R.A. No. 9335 and its IRR do not comply with the
requirements under CSC rules and regulations as the dismissal in this
case is immediately executory. Such immediately executory nature of
the Boards decision negates the remedies available to an employee as
provided under the CSC rules.
2. R.A. No. 9335 and its IRR violate the BIR and BOC employees right to
equal protection of the law because R.A. No. 9335 and its IRR unduly
discriminates against BIR and BOC employees as compared to
employees of other revenue generating government agencies like the
Philippine Amusement and Gaming Corporation, Department of
Transportation and Communication, the Air Transportation Office, the
Land Transportation Office, and the Philippine Charity Sweepstakes
Office, among others, which are not subject to attrition.
3. R.A. No. 9335 and its IRR violate the BIR and BOC employees right to
security of tenure because R.A. No. 9335 and its IRR effectively
removed remedies provided in the ordinary course of administrative
procedure afforded to government employees. The law likewise
created another ground for dismissal, i.e., non-attainment of revenue
collection target, which is not provided under CSC rules and which is,
by its nature, unpredictable and therefore arbitrary and unreasonable.
4. R.A. No. 9335 and its IRR violate the 1987 Constitution because
Congress granted to the Revenue Performance Evaluation Board
(Board) the unbridled discretion of formulating the criteria for
termination, the manner of allocating targets, the distribution of
rewards and the determination of relevant factors affecting the targets
of collection, which is tantamount to undue delegation of legislative
power.
5. R.A. No. 9335 is a bill of attainder because it inflicts punishment upon
a particular group or class of officials and employees without trial. This
is evident from the fact that the law confers upon the Board the power
to impose the penalty of removal upon employees who do not meet
their revenue targets; that the same is without the benefit of hearing;
and that the removal from service is immediately executory. Lastly, it
disregards the presumption of regularity in the performance of the
official functions of a public officer.[25]
On the other hand, respondents through the OSG stress that except for Section 12 of R.A. No.

9335, R.A. No. 9335 and its IRR are constitutional, as per our ruling in Abakada. Nevertheless, 3. Whether R.A. No. 9335 is a bill of attainder.

the OSG argues that the classification of BIR and BOC employees as public officers under R.A.

No. 9335 is based on a valid and substantial distinction since the revenue generated by the BIR

and BOC is essentially in the form of taxes, which is the lifeblood of the State, while the revenue Our Ruling
produced by other agencies is merely incidental or secondary to their governmental functions;

that in view of their mandate, and for purposes of tax collection, the BIR and BOC are sui
Prefatorily, we note that it is clear, and in fact uncontroverted, that BOCEA has locus standi.
generis; that R.A. No. 9335 complies with the completeness and sufficient standard tests for the
BOCEA impugns the constitutionality of R.A. No. 9335 and its IRR because its members, who
permissive delegation of legislative power to the Board; that the Board exercises its delegated
are rank-and-file employees of the BOC, are actually covered by the law and its IRR. BOCEAs
power consistent with the policy laid down in the law, that is, to optimize the revenue generation
members have a personal and substantial interest in the case, such that they have sustained or
capability and collection of the BIR and the BOC; that parameters were set in order that the
will sustain, direct injury as a result of the enforcement of R.A. No. 9335 and its IRR. [27]
Board may identify the officials and employees subject to attrition, and the proper procedure for

their removal in case they fail to meet the targets set in the Performance Contract were
However, we find no merit in the petition and perforce dismiss the same.
provided; and that the rights of BIR and BOC employees to due process of law and security of

tenure are duly accorded by R.A. No. 9335. The OSG likewise maintains that there was no
It must be noted that this is not the first time the constitutionality of R.A. No. 9335 and its IRR are
encroachment of judicial power in the enactment of R.A. No. 9335 amounting to a bill of
being challenged. The Court already settled the majority of the same issues raised by BOCEA in
attainder since R.A. No. 9335 and its IRR merely defined the offense and provided for the
our decision in Abakada, which attained finality on September 17, 2008. As such, our ruling
penalty that may be imposed. Finally, the OSG reiterates that the separation from the service of
therein is worthy of reiteration in this case.
any BIR or BOC employee under R.A. No. 9335 and its IRR shall be done only upon due

consideration of all relevant factors affecting the level of collection, subject to Civil Service laws,
We resolve the first issue in the negative.
rules and regulations, and in compliance with substantive and procedural due process. The OSG

opines that the Performance Contract, far from violating the BIR and BOC employees right to
The principle of separation of powers ordains that each of the three great branches of
due process, actually serves as a notice of the revenue target they have to meet and the
government has exclusive cognizance of and is supreme in matters falling within its own
possible consequences of failing to meet the same. More, there is nothing in the law which
constitutionally allocated sphere.[28] Necessarily imbedded in this doctrine is the principle of non-
prevents the aggrieved party from appealing the unfavorable decision of dismissal. [26]
delegation of powers, as expressed in the Latin maxim potestas delegata non delegari

potest, which means what has been delegated, cannot be delegated. This doctrine is based on
In essence, the issues for our resolution are:
the ethical principle that such delegated power constitutes not only a right but a duty to be
1. Whether there is undue delegation of legislative power to the Board;
performed by the delegate through the instrumentality of his own judgment and not through the

intervening mind of another.[29] However, this principle of non-delegation of powers admits of

numerous exceptions,[30] one of which is the delegation of legislative power to various

2. Whether R.A. No. 9335 and its IRR violate the rights of BOCEAs
members to: (a) equal protection of laws, (b) security of tenure and (c) specialized administrative agencies like the Board in this case.
due process; and

The rationale for the aforementioned exception was clearly explained in our ruling in Gerochi v.
Department of Energy,[31] to wit:
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. Given the volume and variety of
interactions in todays 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.[32]
Thus, in Abakada, we held,
Two tests determine the validity of delegation of legislative power:
(1) the completeness test and (2) the sufficient standard test. A law is
complete when it sets forth therein the policy to be executed, carried out or
implemented by the delegate. It lays down a sufficient standard when it
provides adequate guidelines or limitations in the law to map out the
boundaries of the delegates authority and prevent the delegation from
running riot. To be sufficient, the standard must specify the limits of the
delegates authority, announce the legislative policy and identify the
conditions under which it is to be implemented.
RA [No.] 9335 adequately states the policy and standards to
guide the President in fixing revenue targets and the implementing agencies
in carrying out the provisions of the law. Section 2 spells out the policy of
the law:
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.
Section 4 canalized within banks that keep it from overflowing the
delegated power to the President to fix 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), in the following percentages:
Excess of Collection [Over] the Percent (%) of the Excess
Revenue Targets Collection to Accrue to the Fund
30% or below 15%
More than 30% 15% of the first 30% plus 20% of
the remaining excess
The Fund shall be deemed automatically appropriated
the year immediately following the year when the revenue
collection target was exceeded and shall be released on the same
fiscal year.
Revenue targets shall refer to the original estimated
revenue collection expected of the BIR and the BOC for a
given fiscal year as stated in the Budget of Expenditures and
Sources of Financing (BESF) submitted by the President to
Congress. The BIR and the BOC shall submit to the DBCC the
distribution of the agencies revenue targets as allocated among
its revenue districts in the case of the BIR, and the collection
districts in the case of the BOC.
xxxxxxxxx
Revenue targets are based on the original estimated revenue
collection expected respectively of the BIR and the BOC for a given fiscal
year as approved by the DBCC and stated in the BESF submitted by the
President to Congress. Thus, the determination of revenue targets does not
rest solely on the President as it also undergoes the scrutiny of the DBCC.
On the other hand, Section 7 specifies the limits of the Boards
authority and identifies the conditions under which officials and employees
whose revenue collection falls short of the target by at least 7.5% may be
removed from the service:
SEC. 7. Powers and Functions of the Board. The Board
in the agency shall have the following powers and functions:
xxxxxxxxx
(b) To set the criteria and procedures for removing
from service officials and employees whose revenue
collection falls short of the target by at least seven and a half
percent (7.5%), with due consideration of all relevant factors
affecting the level of collection as provided in the rules and
regulations promulgated under this Act, subject to civil service
laws, rules and regulations and compliance with substantive
and procedural due process: Provided, That the following
exemptions shall apply:
1. Where the district or area of responsibility is
newly-created, not exceeding two years in operation, and
has no historical record of collection performance that can
be used as basis for evaluation; and
2. Where the revenue or customs official or
employee is a recent transferee in the middle of the period
under consideration unless the transfer was due to
 nonperformance of revenue targets or potential
nonperformance of revenue targets: Provided, however, Equal protection simply provides that all persons or things similarly situated should be treated in
That when the district or area of responsibility covered by
a similar manner, both as to rights conferred and responsibilities imposed. The purpose of the
revenue or customs officials or employees has suffered from
economic difficulties brought about by natural calamities equal protection clause is to secure every person within a states jurisdiction against intentional
or force majeure or economic causes as may be determined
by the Board, termination shall be considered only after and arbitrary discrimination, whether occasioned by the express terms of a statute or by its
careful and proper review by the Board.
improper execution through the states duly constituted authorities. In other words, the concept of
(c) To terminate personnel in accordance with the
criteria adopted in the preceding paragraph: Provided, That such equal justice under the law requires the state to govern impartially, and it may not draw
decision shall be immediately executory: Provided, further, distinctions between individuals solely on differences that are irrelevant to a legitimate
That the application of the criteria for the separation of an
official or employee from service under this Act shall be governmental objective.[36]
without prejudice to the application of other relevant laws on
accountability of public officers and employees, such as the
Code of Conduct and Ethical Standards of Public Officers
and Employees and the Anti-Graft and Corrupt Practices Act; Thus, on the issue on equal protection of the laws, we held in Abakada:

The equal protection clause recognizes a valid classification, that

xxxxxxxxx is, a classification that has a reasonable foundation or rational basis and not
arbitrary. With respect to RA [No.] 9335, its expressed public policy is the
At any rate, this Court has recognized the following as sufficient optimization of the revenue-generation capability and collection of the BIR
standards: public interest, justice and equity, public convenience and and the BOC. Since the subject of the law is the revenue-generation
welfare and simplicity, economy and welfare. In this case, the declared capability and collection of the BIR and the BOC, the incentives and/or
policy of optimization of the revenue-generation capability and collection of sanctions provided in the law should logically pertain to the said
the BIR and the BOC is infused with public interest.[33] agencies. Moreover, the law concerns only the BIR and the BOC because
they have the common distinct primary function of generating revenues for
the national government through the collection of taxes, customs duties,
fees and charges.
We could not but deduce that the completeness test and the sufficient standard test were fully
The BIR performs the following functions:
satisfied by R.A. No. 9335, as evident from the aforementioned Sections 2, 4 and 7 thereof.
Sec. 18. The Bureau of Internal Revenue. The Bureau
Moreover, Section 5[34] of R.A. No. 9335 also provides for the incentives due to District
of Internal Revenue, which shall be headed by and subject to the
Collection Offices. While it is apparent that the last paragraph of Section 5 provides that [t]he supervision and control of the Commissioner of Internal Revenue,
who shall be appointed by the President upon the
allocation, distribution and release of the district reward shall likewise be prescribed by the rules recommendation of the Secretary [of the DOF], shall have the
following functions:
and regulations of the Revenue Performance and Evaluation Board, Section 7 (a)[35] of R.A. No.
(1) Assess and collect all taxes, fees and
9335 clearly mandates and sets the parameters for the Board by providing that such rules and charges and account for all revenues collected;
guidelines for the allocation, distribution and release of the fund shall be in accordance with (2) Exercise duly delegated police powers for the
proper performance of its functions and duties;
Sections 4 and 5 of R.A. No. 9335. In sum, the Court finds that R.A. No. 9335, read and
(3) Prevent and prosecute tax evasions and all
appreciated in its entirety, is complete in all its essential terms and conditions, and that it other illegal economic activities;
contains sufficient standards as to negate BOCEAs supposition of undue delegation of (4) Exercise supervision and control over its
constituent and subordinate units; and
legislative power to the Board.
(5) Perform such other functions as may be
provided by law.
xxxxxxxxx
Similarly, we resolve the second issue in the negative.
On the other hand, the BOC has the following functions:
 Sec. 23. The Bureau of Customs. The Bureau of
Customs which shall be headed and subject to the management
and control of the Commissioner of Customs, who shall be
appointed by the President upon the recommendation of the
Secretary [of the DOF] and hereinafter referred to as
Commissioner, shall have the following functions:
(1) Collect custom duties, taxes and the
corresponding fees, charges and penalties;
(2) Account for all customs revenues
collected;
(3) Exercise police authority for the enforcement of
tariff and customs laws;
(4) Prevent and suppress smuggling, pilferage and
all other economic frauds within all ports of entry;
(5) Supervise and control exports, imports, foreign
mails and the clearance of vessels and aircrafts in all ports
of entry;
(6) Administer all legal requirements that are
appropriate;
(7) Prevent and prosecute smuggling and other
illegal activities in all ports under its jurisdiction;
(8) Exercise supervision and control over its
constituent units;
(9) Perform such other functions as may be
provided by law.
xxxxxxxxx
Both the BIR and the BOC are bureaus under the DOF. They principally
perform the special function of being the instrumentalities through which the
State exercises one of its great inherent functions taxation. Indubitably, such
substantial distinction is germane and intimately related to the purpose of
the law. Hence, the classification and treatment accorded to the BIR and the
BOC under RA [No.] 9335 fully satisfy the demands of equal protection.[37]
As it was imperatively correlated to the issue on equal protection, the issues on the security of
tenure of affected BIR and BOC officials and employees and their entitlement to due process
were also settled in Abakada:
Clearly, RA [No.] 9335 in no way violates the security of tenure of
officials and employees of the BIR and the BOC. The guarantee of security
of tenure only means that an employee cannot be dismissed from the
service for causes other than those provided by law and only after due
process is accorded the employee. In the case of RA [No.] 9335, it lays
down a reasonable yardstick for removal (when the revenue collection falls
short of the target by at least 7.5%) with due consideration of all relevant
factors affecting the level of collection. This standard is analogous to
inefficiency and incompetence in the performance of official duties, a ground
for disciplinary action under civil service laws. The action for removal is also
subject to civil service laws, rules and regulations and compliance with
substantive and procedural due process.[38]
In addition, the essence of due process is simply an opportunity to be heard, or as applied to
administrative proceedings, a fair and reasonable opportunity to explain ones side. [39] BOCEAs
apprehension of deprivation of due process finds its answer in Section 7 (b) and (c) of R.A. No.
9335.[40] The concerned BIR or BOC official or employee is not simply given a target revenue
collection and capriciously left without any quarter. R.A. No. 9335 and its IRR clearly give due
consideration to all relevant factors[41] that may affect the level of collection. In the same manner,
exemptions[42] were set, contravening BOCEAs claim that its members may be removed for
unattained target collection even due to causes which are beyond their control. Moreover, an
employees right to be heard is not at all prevented and his right to appeal is not deprived of
him.[43] In fine, a BIR or BOC official or employee in this case cannot be arbitrarily removed from
the service without according him his constitutional right to due process. No less than R.A.
No. 9335 inaccordance with the 1987 Constitution guarantees this.
We have spoken, and these issues were finally laid to rest. Now, the Court proceeds to resolve
the last, but new issue raised by BOCEA, that is, whether R.A. No. 9335 is a bill of attainder
proscribed under Section 22,[44] Article III of the 1987 Constitution.
On this score, we hold that R.A. No. 9335 is not a bill of attainder. A bill of attainder is a
legislative act which inflicts punishment on individuals or members of a particular group without a
judicial trial. Essential to a bill of attainder are a specification of certain individuals or a group of
individuals, the imposition of a punishment, penal or otherwise, and the lack of judicial trial.[45]
In his Concurring Opinion in Tuason v. Register of Deeds, Caloocan City,[46] Justice Florentino
P. Feliciano traces the roots of a Bill of Attainder, to wit:
Bills of attainder are an ancient instrument of tyranny. In England a few
centuries back, Parliament would at times enact bills or statutes which
declared certain persons attainted and their blood corrupted so that it lost all
heritable quality (Ex Parte Garland, 4 Wall. 333, 18 L.Ed. 366 [1867]). In
more modern terms, a bill of attainder is essentially a usurpation of judicial
power by a legislative body. It envisages and effects the imposition of a
penalty the deprivation of life or liberty or property not by the ordinary
 processes of judicial trial, but by legislative fiat. While cast in the form of
special legislation, a bill of attainder (or bill of pains and penalties, if it No costs.
prescribed a penalty other than death) is in intent and effect a penal
judgment visited upon an identified person or group of persons (and
not upon the general community) without a prior charge or demand, SO ORDERED.
without notice and hearing, without an opportunity to defend, without
any of the civilized forms and safeguards of the judicial process as we
know it (People v. Ferrer, 48 SCRA 382 [1972]; Cummings and Missouri, 4
Wall. 277, 18 L. Ed. 356 [1867]; U.S. v. Lovett, 328, U.S. 303, 90 L.Ed. 1252
[1945]; U.S. v. Brown, 381 U.S. 437, 14 L.Ed. 2d. 484 [1965]. Such is the
archetypal bill of attainder wielded as a means of legislative oppression. x x
x[47]

R.A. No. 9335 does not possess the elements of a bill of attainder. It does not seek to inflict

punishment without a judicial trial. R.A. No. 9335 merely lays down the grounds for the

termination of a BIR or BOC official or employee and provides for the consequences thereof.

The democratic processes are still followed and the constitutional rights of the concerned

employee are amply protected.

A final note.

We find that BOCEAs petition is replete with allegations of defects and anomalies in allocation,

distribution and receipt of rewards. While BOCEA intimates that it intends to curb graft and

corruption in the BOC in particular and in the government in general which is nothing but noble,

these intentions do not actually pertain to the constitutionality of R.A. No. 9335 and its IRR, but

rather in the faithful implementation thereof. R.A. No. 9335 itself does not tolerate these

pernicious acts of graft and corruption.[48] As the Court is not a trier of facts, the investigation on

the veracity of, and the proper action on these anomalies are in the hands of the Executive

branch. Correlatively, the wisdom for the enactment of this law remains within the domain of the

Legislative branch. We merely interpret the law as it is. The Court has no discretion to give

statutes a meaning detached from the manifest intendment and language thereof.[49] Just like

any other law, R.A. No. 9335 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.[50] We have so declared in Abakada, and we now

reiterate that R.A. No. 9335 and its IRR are constitutional.

WHEREFORE, the present petition for certiorari and prohibition with prayer for injunctive relief/s

is DISMISSED.