EN BANC

[G.R. No. 124360. November 5, 1997]

essential to the general !elfare/ enacted the #il $ndustry Co""ission Act. '6( $t created the O0> I1?9/6r7 Comm0//0o1 *#$C- to re<9>46e the business of i"porting/ e)porting/ re7e)porting/ shipping/ transporting/ processing/ refining/ storing/ distributing/ "ar0eting and selling crude oil/ gasoline/ 0erosene/ gas and other refined petroleu" products. The #$C !as .ested !ith the 5o@er 6o ;08 the "ar0et 5r03e/ of petroleu" products/ to regulate the capacities of refineries/ to license ne! refineries and to regulate the operations and trade practices of the industry.'1( $n addition to the creation of the #$C/ the go.ern"ent sa! the i"perious need for a "ore acti.e role of %ilipinos in the oil industry. *160> 62e e4r>7 /eve160e/, 62e ?o@1/6re4m o0> 01?9/6r7 @4/ 3o16ro>>e? b7 m9>601460o14> 3om5410e/. All the oil refineries and "ar0eting co"panies !ere o!ned by ;ore0<1er/ !hose econo"ic interests did not al!ays coincide !ith the interest of the %ilipino. Crude oil !as transported to the country by foreign7controlled tan0ers. Crude processing !as done locally by foreign7o!ned refineries and petroleu" products !ere "ar0eted through foreign7o!ned retail outlets. #n No.e"ber 8/ 1896/ &resident %erdinand E. 4arcos boldly created the &hilippine National #il Corporation *&N#C- to brea0 the control by foreigners of our oil industry. ':( &N#C engaged in the business of refining/ "ar0eting/ shipping/ transporting/ and storing petroleu". $t ac;uired o!nership of E22# &hilippines and %iloil to ser.e as its "ar0eting ar". $t bought the controlling shares of Bataan Refining Corporation/ the largest refinery in the country. ',( &N#C later put up its o!n "ar0eting subsidiary 77 &etrophil. &N#C operated under the business na"e &ETR#N Corporation. %or the first ti"e/ there !as a %ilipino presence in the &hilippine oil "ar0et. $n 1881/ &resident 4arcos through 2ection 8 of &residential ecree No. 18:,/ created the O0> #r03e S64b0>0A460o1 F91? *#&2%- to cushion the effects of fre;uent changes in the price of oil caused by e)change rate ad<ust"ents or increase in the !orld "ar0et prices of crude oil and i"ported petroleu" products. The fund is used *1- to rei"burse the oil co"panies for cost increases in crude oil and i"ported petroleu" products resulting fro" e)change rate ad<ust"ent and=or increase in !orld "ar0et prices of crude oil/ and *+- to rei"burse oil co"panies for cost underreco.ery incurred as a result of the reduction of do"estic prices of petroleu" products. >nder the la!/ the #&2% "ay be sourced fro"? 1. any increase in the ta) collection fro" ad .alore" ta) or custo"s duty i"posed on petroleu" products sub<ect to ta) under &. . No. 18:, arising fro" e)change rate ad<ust"ent/ +. any increase in the ta) collection as a result of the lifting of ta) e)e"ptions of go.ern"ent corporations/ as "ay be deter"ined by the 4inister of %inance in consultation !ith the Board of Energy/ 6. any additional a"ount to be i"posed on petroleu" products to aug"ent the resources of the fund through an appropriate order that "ay be issued by the Board of Energy re;uiring pay"ent of persons or co"panies engaged in the business of

FRANCISCO S. TATAD, petitioner, vs. T ! S!CR!TAR" OF T ! D!#ART$!NT OF !N!RG" AND T ! S!CR!TAR" OF T ! D!#ART$!NT OF FINANC!, respondents.

[G.R. No. 127%67. November 5, 1997]

!DC!& C. &AG$AN, 'O(!R #. ARRO"O, !NRI)*! GARCIA, +IG,!RTO TANADA, F&AG *$AN RIG TS FO*NDATION, INC., FR!!DO$ FRO$ D!,T COA&ITION -FDC., SAN&A(AS, petitioners, v/. ON. R*,!N TORR!S 01 20/ 34543067 4/ 62e !8e3960ve Se3re64r7, ON. FRANCISCO :IRA", 01 20/ 34543067 4/ 62e Se3re64r7 o; !1er<7, CA&T!= #20>05501e/, I13., #!TRON Cor5or460o1 41? #I&I#INAS S !&& Cor5or460o1,respondents. D!CISION #*NO, J.: The petitions at bar challenge the constitutionality of Republic Act No. 8180 entitled "An Act eregulating the o!nstrea" #il $ndustry and %or #ther &urposes."'1( R.A. No. 8180 ends t!enty si) *+,- years of go.ern"ent regulation of the do!nstrea" oil industry. %e! cases carry a surpassing i"portance on the life of e.ery %ilipino as these petitions for the ups!ing and do!ns!ing of our econo"y "aterially depend on the oscillation of oil. %irst/ the facts !ithout the fat. #r0or 6o 1971/ there !as no go.ern"ent agency regulating the oil industry other than those dealing !ith ordinary co""odities. #il co"panies !ere free to enter and e)it the "ar0et !ithout any go.ern"ent interference. There !ere four *1- refining co"panies *2hell/ Calte)/ Bataan Refining Co"pany and %iloil Refining- and si) *,- petroleu" "ar0eting co"panies *Esso/ %iloil/ Calte)/ 3etty/ 4obil and 2hell-/ then operating in the country. '+( I1 1971/ the country !as dri.en to its 0nees by a crippling oil crisis. The go.ern"ent/ reali5ing that petroleu" and its products are .ital to national security and that their continued supply at reasonable prices is

i"porting/ "anufacturing products/ or

and=or

"ar0eting

petroleu"

1. any resulting peso costs differentials in case the actual peso costs paid by oil co"panies in the i"portation of crude oil and petroleu" products is less than the peso costs co"puted using the reference foreign e)change rate as fi)ed by the Board of Energy.'9( ,7 19%5/ only three *6- oil co"panies !ere operating in the country 77 Calte)/ 2hell and the go.ern"ent7o!ned &N#C. $n $47, 19%7/ &resident Cora5on C. A;uino signed E)ecuti.e #rder No. 19+ creating the !1er<7 Re<9>46or7 ,o4r? to regulate the business of i"porting/ e)porting/ re7e)porting/ shipping/ transporting/ processing/ refining/ "ar0eting and distributing energy resources "!hen !arranted and only !hen public necessity re;uires." The Board had the follo!ing po!ers and functions? 1. %i) and regulate the prices of petroleu" products@ +. %i) and regulate the rate schedule or prices of piped gas to be charged by duly franchised gas co"panies !hich distribute gas by "eans of underground pipe syste"@ 6. %i) and regulate the rates of pipeline concessionaries under the pro.isions of R.A. No. 689/ as a"ended ) ) )@ 1. Regulate the capacities of ne! refineries or additional capacities of e)isting refineries and license refineries that "ay be organi5ed after the issuance of *E.#. No. 19+- under such ter"s and conditions as are consistent !ith the national interest@ and :. Ahene.er the Board has deter"ined that there is a shortage of any petroleu" product/ or !hen public interest so re;uires/ it "ay ta0e such steps as it "ay consider necessary/ including the te"porary ad<ust"ent of the le.els of prices of petroleu" products and the pay"ent to the #il &rice 2tabili5aton %und ) ) ) by persons or entities engaged in the petroleu" industry of such a"ounts as "ay be deter"ined by the Board/ !hich "ay enable the i"porter to reco.er its cost of i"portation. '8( #n De3ember 9, 1992, Congress enacted R.A. No. 9,68 !hich created the De54r6me16 o; !1er<7 to prepare/ integrate/ coordinate/ super.ise and control all plans/ progra"s/ pro<ects/ and acti.ities of the go.ern"ent in relation to energy e)ploration/ de.elop"ent/ utili5ation/ distribution and conser.ation. '8( The thrust of the &hilippine energy progra" under the la! !as to!ard5r0v460A460o1 of go.ern"ent agencies related to energy/ ?ere<9>460o1 of the po!er and energy industry and reduction of dependency on oil7fired plants. '10( The la! also ai"ed to encourage free and acti.e participation and in.est"ent by the pri.ate sector in all energy acti.ities. 2ection :*e- of the la! states that "at the end of four *1- years fro" the effecti.ity of this Act/ the epart"ent shall/

upon appro.al of the &resident/ institute the progra"s and 60me64b>e o; ?ere<9>460o1 of appropriate energy pro<ects and acti.ities of the energy industry." &ursuant to the policies enunciated in R.A. No. 9,68/ the go.ern"ent appro.ed the 5r0v460A460o1 o; #e6ro1 Cor5or460o1 in 1886. #n ece"ber 1,/ 1886/ &N#C sold 10B of its e;uity in &etron Corporation to the Ara"co #.erseas Co"pany. $n $4r32 1996/ Congress too0 the audacious step of ?ere<9>4601< 62e ?o@1/6re4m o0> 01?9/6r7 . $t enacted R.A. No. %1%0/ entitled the " o!nstrea" #il $ndustry eregulation Act of 188,." >nder the deregulated en.iron"ent/ "any person or entity "ay i"port or purchase any ;uantity of crude oil and petroleu" products fro" a foreign or do"estic source/ lease or o!n and operate refineries and other do!nstrea" oil facilities and "ar0et such crude oil or use the sa"e for his o!n re;uire"ent/" sub<ect only to "onitoring by the epart"ent of Energy.'11( T2e ?ere<9>460o1 5ro3e// 24/ 6@o 524/e/B 62e 6r41/060o1 524/e 41? 62e ;9>> ?ere<9>460o1 524/e. uring the transition phase/ 3o16ro>/ o; 62e 1o1C5r0301< 4/5e36/ of the oil industry !ere to be lifted. The follo!ing !ere to be acco"plished? *1- liberali5ation of oil i"portation/ e)portation/ "anufacturing/ "ar0eting and distribution/ *+i"ple"entation of an auto"atic pricing "echanis"/ *6- i"ple"entation of an auto"atic for"ula to set "argins of dealers and rates of haulers/ !ater transport operators and pipeline concessionaires/ and *1- restructuring of oil ta)es. >pon full deregulation/ 3o16ro>/ o1 62e 5r03e o; o0> and the foreign e)change co.er !ere to be lifted and the #&2% !as to be abolished. The first phase of deregulation co""enced on August 1+/ 188,. O1 Febr94r7 %, 1997, 62e #re/0?e16 0m5>eme16e? 62e ;9>> ?ere<9>460o1 o; 62e Do@1/6re4m O0> I1?9/6r7 62ro9<2 !.O. No. 372. The petitions at bar assail the constitutionality of .arious pro.isions of R.A. No. 8180 and E.#. No. 69+. I1 G.R. No. 124360/ petitioner %rancisco 2. Tatad see0s the annul"ent of section : *b- of R.A. No. 8180. 2ection : *b- pro.ides? "b- Any la! to the contrary not!ithstanding and starting !ith the effecti.ity of this Act/ tariff duty shall be i"posed and collected on i"ported crude oil at the rate of three percent *6B- and i"ported refined petroleu" products at the rate of se.en percent *9B-/ e)cept fuel oil and C&3/ the rate for !hich shall be the sa"e as that for i"ported crude oil? &ro.ided/ That beginning on Danuary 1/ +001 the tariff rate on i"ported crude oil and refined petroleu" products shall be the sa"e? &ro.ided/ further/ That this pro.ision "ay be a"ended only by an Act of Congress." The petition is anchored on three argu"ents?

%irst/ that the i"position of different tariff rates on i"ported crude oil and i"ported refined petroleu" products .iolates the e;ual protection clause. &etitioner contends that the 6B79B tariff differential unduly fa.ors the three e)isting oil refineries and discri"inates against prospecti.e in.estors in the do!nstrea" oil industry !ho do not ha.e their o!n refineries and !ill ha.e to source refined petroleu" products fro" abroad. 2econd/ that the i"position of different tariff rates does not deregulate the do!nstrea" oil industry but instead controls the oil industry/ contrary to the a.o!ed policy of the la!. &etitioner a.ers that the tariff differential bet!een i"ported crude oil and i"ported refined petroleu" products bars the entry of other players in the oil industry because it effecti.ely protects the interest of oil co"panies !ith e)isting refineries. Thus/ it runs counter to the ob<ecti.e of the la! "to foster a truly co"petiti.e "ar0et." Third/ that the inclusion of the tariff pro.ision in section :*b- of R.A. No. 8180 .iolates 2ection +,*1- Article E$ of the Constitution re;uiring e.ery la! to ha.e only one sub<ect !hich shall be e)pressed in its title. &etitioner contends that the i"position of tariff rates in section :*bof R.A. No. 8180 is foreign to the sub<ect of the la! !hich is the deregulation of the do!nstrea" oil industry. I1 G.R. No. 127%67/ petitioners Edcel C. Cag"an/ Do0er &. Arroyo/ Enri;ue 3arcia/ Aigberto Tanada/ %lag Fu"an Rights %oundation/ $nc./ %reedo" fro" ebt Coalition *% C- and 2anla0as contest the constitutionality of section 1: of R.A. No. 8180 and E.#. No. 68+. 2ection 1: pro.ides? "2ec. 1:. $"ple"entation of %ull eregulation. 77 &ursuant to 2ection :*eof Republic Act No. 9,68/ the #E shall/ upon appro.al of the &resident/ i"ple"ent the full deregulation of the do!nstrea" oil industry not later than 4arch 1889. As far as practicable/ the #E shall ti"e the full deregulation !hen the prices of crude oil and petroleu" products in the !orld "ar0et are declining and !hen the e)change rate of the peso in relation to the >2 dollar is stable. >pon the i"ple"entation of the full deregulation as pro.ided herein/ the transition phase is dee"ed ter"inated and the follo!ing la!s are dee"ed repealed? ))) E.#. No. 69+ states in full/ viz.? "AFEREA2/ Republic Act No. 9,68/ other!ise 0no!n as the " epart"ent of Energy Act of 188+/" pro.ides that/ at the end of four years fro" its effecti.ity last ece"ber 188+/ "the epart"ent *of Energy- shall/ upon appro.al of the &resident/ institute the progra"s and ti"e table of deregulation of appropriate energy pro<ects and acti.ities of the energy sector@"

AFEREA2/ 2ection 1: of Republic Act No. 8180/ other!ise 0no!n as the " o!nstrea" #il $ndustry eregulation Act of 188,/" pro.ides that "the #E shall/ upon appro.al of the &resident/ i"ple"ent full deregulation of the do!nstrea" oil industry not later than 4arch/ 1889. As far as practicable/ the #E shall ti"e the full deregulation !hen the prices of crude oil and petroleu" products in the !orld "ar0et are declining and !hen the e)change rate of the peso in relation to the >2 dollar is stable@" AFEREA2/ pursuant to the reco""endation of the epart"ent of Energy/ there is an i"perati.e need to i"ple"ent the full deregulation of the do!nstrea" oil industry because of the follo!ing recent de.elop"ents? *idepletion of the buffer fund on or about 9 %ebruary 1889 pursuant to the Energy Regulatory BoardGs #rder dated 1, Danuary 1889@ *ii- the prices of crude oil had been stable at H+17H+6 per barrel since #ctober 188, !hile prices of petroleu" products in the !orld "ar0et had been stable since "id7 ece"ber of last year. 4oreo.er/ crude oil prices are beginning to soften for the last fe! days !hile prices of so"e petroleu" products had already declined@ and *iii- the e)change rate of the peso in relation to the >2 dollar has been stable for the past t!el.e *1+- "onths/ a.eraging at around &+,.+0 to one >2 dollar@ AFEREA2/ E)ecuti.e #rder No. 699 dated 61 #ctober 188, pro.ides for an institutional fra"e!or0 for the ad"inistration of the deregulated industry by defining the functions and responsibilities of .arious go.ern"ent agencies@ AFEREA2/ pursuant to Republic Act No. 8180/ the deregulation of the industry !ill foster a truly co"petiti.e "ar0et !hich can better achie.e the social policy ob<ecti.es of fair prices and ade;uate/ continuous supply of en.iron"entally7clean and high ;uality petroleu" products@ N#A/ TFERE%#RE/ $/ %$ EC E. RA4#2/ &resident of the Republic of the &hilippines/ by the po!ers .ested in "e by la!/ do hereby declare the full deregulation of the do!nstrea" oil industry." $n assailing section 1: of R.A. No. 8180 and E.#. No. 68+/ petitioners offer the follo!ing sub"issions? %irst/ section 1: of R.A. No. 8180 constitutes an undue delegation of legislati.e po!er to the &resident and the 2ecretary of Energy because it does not pro.ide a deter"inate or deter"inable standard to guide the E)ecuti.e Branch in deter"ining !hen to i"ple"ent the full deregulation of the do!nstrea" oil industry. &etitioners contend that the la! does not define !hen it is practicable for the 2ecretary of Energy to reco""end to the &resident the full deregulation of the do!nstrea" oil industry or !hen the &resident "ay consider it practicable to declare full deregulation. Also/ the la! does not pro.ide any specific standard to deter"ine !hen the prices of crude oil in the !orld "ar0et are considered to be declining nor !hen the e)change rate of the peso to the >2 dollar is considered stable.

2econd/ petitioners a.er that E.#. No. 68+ i"ple"enting the full deregulation of the do!nstrea" oil industry is arbitrary and unreasonable because it !as enacted due to the alleged depletion of the #&2% fund 77 a condition not found in R.A. No. 8180. Third/ section 1: of R.A. No. 8180 and E.#. No. 68+ allo! the for"ation of a de facto cartel a"ong the three e)isting oil co"panies 77 &etron/ Calte) and 2hell 77 in .iolation of the constitutional prohibition against "onopolies/ co"binations in restraint of trade and unfair co"petition. Respondents/ on the other hand/ fer.ently defend the constitutionality of R.A. No. 8180 and E.#. No. 68+. $n addition/ respondents contend that the issues raised by the petitions are not <usticiable as they pertain to the !isdo" of the la!. Respondents further a.er that petitioners ha.e no locus standi as they did not sustain nor !ill they sustain direct in<ury as a result of the i"ple"entation of R.A. No. 8180. The petitions !ere heard by the Court on 2epte"ber 60/ 1889. #n #ctober 9/ 1889/ the Court ordered the pri.ate respondents oil co"panies "to "aintain the status ;uo and to cease and desist fro" increasing the prices of gasoline and other petroleu" fuel products for a period of thirty *60- days ) ) ) sub<ect to further orders as conditions "ay !arrant." Ae shall no! resol.e the petitions on the "erit. The petitions raise procedural and substanti.e issues bearing on the constitutionality of R.A. No. 8180 and E.#. No. 68+. The 5ro3e?9r4> 0//9e/ are? *1- !hether or not the petitions raise a <usticiable contro.ersy/ and *+- !hether or not the petitioners ha.e the standing to assail the .alidity of the sub<ect la! and e)ecuti.e order. The /9b/64160ve 0//9e/ are? *1- !hether or not section : *b- .iolates the one title 7 one sub<ect re;uire"ent of the Constitution@ *+- !hether or not the sa"e section .iolates the e;ual protection clause of the Constitution@ *6- !hether or not section 1: .iolates the constitutional prohibition on undue delegation of po!er@ *1- !hether or not E.#. No. 68+ is arbitrary and unreasonable@ and *:- !hether or not R.A. No. 8180 .iolates the constitutional prohibition against "onopolies/ co"binations in restraint of trade and unfair co"petition. Ae shall first tac0le the procedural issues. Respondents clai" that the a.alanche of argu"ents of the petitioners assail the !isdo" of R.A. No. 8180. They a.er that deregulation of the do!nstrea" oil industry is a policy decision "ade by Congress and it cannot be re.ie!ed/ "uch less be re.ersed by this Court. $n constitutional parlance/ respondents contend that the petitions failed to raise a <usticiable contro.ersy. RespondentsG <oint stance is unnote!orthy. Dudicial po!er includes not only the duty of the courts to settle actual contro.ersies in.ol.ing rights !hich are legally de"andable and enforceable/ but also the duty to deter"ine !hether or not there has been gra.e abuse of discretion a"ounting to lac0 or e)cess of <urisdiction on the part of any branch or instru"entality of the go.ern"ent. '1+(The courts/ as guardians of the Constitution/ ha.e the inherent authority to deter"ine !hether a statute

enacted by the legislature transcends the li"it i"posed by the funda"ental la!. Ahere a statute .iolates the Constitution/ it is not only the right but the duty of the <udiciary to declare such act as unconstitutional and .oid.'16( Ae held in the recent case of Tanada v. Angara?'11( ") ) ) $n see0ing to nullify an act of the &hilippine 2enate on the ground that it contra.enes the Constitution/ the petition no doubt raises a <usticiable contro.ersy. Ahere an action of the legislati.e branch is seriously alleged to ha.e infringed the Constitution/ it beco"es not only the right but in fact the duty of the <udiciary to settle the dispute. The ;uestion thus posed is <udicial rather than political. The duty to ad<udicate re"ains to assure that the supre"acy of the Constitution is upheld. #nce a contro.ersy as to the application or interpretation of a constitutional pro.ision is raised before this Court/ it beco"es a legal issue !hich the Court is bound by constitutional "andate to decide." E.en a sideglance at the petitions !ill re.eal that petitioners ha.e raised constitutional issues !hich deser.e the resolution of this Court in .ie! of their seriousness and their .alue as precedents. #ur state"ent of facts and definition of issues clearly sho! that petitioners are assailing R.A. No. 8180 because its pro.isions infringe the Constitution and not because the la! lac0s !isdo". The principle of separation of po!er "andates that challenges on the constitutionality of a la! should be resol.ed in our courts of <ustice !hile doubts on the !isdo" of a la! should be debated in the halls of Congress. E.ery no! and then/ a la! "ay be denounced in court both as bereft of !isdo" and constitutionally infir"ed. 2uch denunciation !ill not deny this Court of its <urisdiction to resol.e the constitutionality of the said la! !hile prudentially refusing to pass on its !isdo". The effort of respondents to ;uestion the locus standi of petitioners "ust also fall on barren ground. $n language too lucid to be "isunderstood/ this Court has brightlined its liberal stance on a petitionerGs locus standi !here the petitioner is able to craft an issue of transcendental significance to the people. '1:( $n Kapatiran ng mga Naglilingkod sa Pamahalaan ng Pilipinas, Inc. v. Tan ,'1,( !e stressed? ") ) ) #b<ections to ta)payersG suit for lac0 of sufficient personality/ standing or interest are/ ho!e.er/ in the "ain procedural "atters. Considering the i"portance to the public of the cases at bar/ and in 0eeping !ith the CourtGs duty/ under the 1889 Constitution/ to deter"ine !hether or not the other branches of go.ern"ent ha.e 0ept the"sel.es !ithin the li"its of the Constitution and the la!s and that they ha.e not abused the discretion gi.en to the"/ the Court has brushed aside technicalities of procedure and has ta0en cogni5ance of these petitions."

There is not a dot of disagree"ent bet!een the petitioners and the respondents on the far reaching i"portance of the .alidity of RA No. 8180 deregulating our do!nstrea" oil industry. Thus/ there is no good sense in being hypertechnical on the standing of petitioners for they pose issues !hich are significant to our people and !hich deser.e our forthright resolution. Ae shall no! trac0 do!n the substanti.e issues. $n 3.R. No. 1+16,0 !here petitioner is 2enator Tatad/ it is contended that section :*b- of R.A. No. 8180 on tariff differential .iolates the pro.ision '19( of the Constitution re;uiring e.ery la! to ha.e only one sub<ect !hich should be e)pressed in its title. Ae do not concur !ith this contention. As a policy/ this Court has adopted a liberal construction of the one title 7 one sub<ect rule. Ae ha.e consistently ruled'18( that the title need not "irror/ fully inde) or catalogue all contents and "inute details of a la!. A la! ha.ing a single general sub<ect indicated in the title "ay contain any nu"ber of pro.isions/ no "atter ho! di.erse they "ay be/ so long as they are not inconsistent !ith or foreign to the general sub<ect/ and "ay be considered in furtherance of such sub<ect by pro.iding for the "ethod and "eans of carrying out the general sub<ect.'18( Ae hold that section :*b- pro.iding for tariff differential is ger"ane to the sub<ect of R.A. No. 8180 !hich is the deregulation of the do!nstrea" oil industry. The section is supposed to s!ay prospecti.e in.estors to put up refineries in our country and "a0e the" rely less on i"ported petroleu".'+0( Ae shall/ ho!e.er/ return to the .alidity of this pro.ision !hen !e e)a"ine its bloc0ing effect on ne! entrants to the oil "ar0et. Ae shall no! slide to the substanti.e issues in 3.R. No. 1+98,9. &etitioners assail section 1: of R.A. No. 8180 !hich fi)es the ti"e fra"e for the full deregulation of the do!nstrea" oil industry. Ae restate its pertinent portion for e"phasis/ viz.? "2ec. 1:. $"ple"entation of %ull eregulation 7 &ursuant to section :*eof Republic Act No. 9,68/ the #E shall/ upon appro.al of the &resident/ i"ple"ent the full deregulation of the do!nstrea" oil industry not later than 4arch 1889. A/ ;4r 4/ 5r436034b>e/ the #E shall ti"e the full deregulation !hen the prices of crude oil and petroleu" products in the !orld "ar0et are ?e3>0101< and !hen the e)change rate of the peso in relation to the >2 dollar is /64b>e ..." &etitioners urge that the phrases "as far as practicable/" "decline of crude oil prices in the !orld "ar0et" and "stability of the peso e)change rate to the >2 dollar" are a"bi.alent/ unclear and inconcrete in "eaning. They sub"it that they do not pro.ide the "deter"inate or deter"inable standards" !hich can guide the &resident in his decision to fully deregulate the do!nstrea" oil industry. $n addition/ they contend that E.#. No. 68+ !hich ad.anced the date of full deregulation is .oid for it illegally considered the depletion of the #&2% fund as a factor. The po!er of Congress to delegate the e)ecution of la!s has long been settled by this Court. As early as 181, in Compania General de

Ta acos de !ilipinas vs. The "oard o# Pu lic $tilit% Commissioners / '+1( this Court thru/ 4r. Dustice 4oreland/ held that "the true distinction is bet!een the delegation of po!er to "a0e the la!/ !hich necessarily in.ol.es a discretion as to !hat it shall be/ and conferring authority or discretion as to its e)ecution/ to be e)ercised under and in pursuance of the la!. The first cannot be done@ to the latter no .alid ob<ection can be "ade." #.er the years/ as the legal engineering of "enGs relationship beca"e "ore difficult/ Congress has to rely "ore on the practice of delegating the e)ecution of la!s to the e)ecuti.e and other ad"inistrati.e agencies. T!o tests ha.e been de.eloped to deter"ine !hether the delegation of the po!er to e)ecute la!s does not in.ol.e the abdication of the po!er to "a0e la! itself. Ae delineated the "etes and bounds of these tests in &astern 'hipping (ines, Inc. vs. P)&A,'++( thus? "There are t!o accepted tests to deter"ine !hether or not there is a .alid delegation of legislati.e po!er/ viz? the co"pleteness test and the sufficient standard test. >nder the first test/ the la! "ust be co"plete in all its ter"s and conditions !hen it lea.es the legislati.e such that !hen it reaches the delegate the only thing he !ill ha.e to do is to enforce it. >nder the sufficient standard test/ there "ust be ade;uate guidelines or li"itations in the la! to "ap out the boundaries of the delegateGs authority and pre.ent the delegation fro" running riot. Both tests are intended to pre.ent a total transference of legislati.e authority to the delegate/ !ho is not allo!ed to step into the shoes of the legislature and e)ercise a po!er essentially legislati.e." The .alidity of delegating legislati.e po!er is no! a ;uiet area in our constitutional landscape. As sagely obser.ed/ delegation of legislati.e po!er has beco"e an ine.itability in light of the increasing co"ple)ity of the tas0 of go.ern"ent. Thus/ courts bend as far bac0 as possible to sustain the constitutionality of la!s !hich are assailed as unduly delegating legislati.e po!ers. Citing *ira a%ashi v. $nited 'tates'+6( as authority/ 4r. Dustice $sagani A. Cru5 states "that e.en if the la! does not e)pressly pinpoint the standard/ the courts !ill bend o.er bac0!ard to locate the sa"e else!here in order to spare the statute/ if it can/ fro" constitutional infir"ity."'+1( 3i.en the groo.e of the CourtGs rulings/ the atte"pt of petitioners to stri0e do!n section 1: on the ground of undue delegation of legislati.e po!er cannot prosper. 2ection 1: can hurdle both the co"pleteness test and the sufficient standard test. $t !ill be noted that Congress e)pressly pro.ided in R.A. No. 8180 that full deregulation !ill start at the end of 4arch 1889/ regardless of the occurrence of any e.ent. %ull deregulation at the end of 4arch 1889 is "andatory and the E)ecuti.e has no discretion to postpone it for any purported reason. Thus/ the la! is co"plete on the ;uestion of the final date of full deregulation. The discretion gi.en to the &resident is to ad.ance the date of full deregulation before the end of 4arch 1889. 2ection 1: lays do!n the standard to guide the <udg"ent of the &resident 777 he is to ti"e it as far 4/ 5r436034b>e !hen the prices of crude oil and petroleu" products in

the !orld "ar0et are ?e3>0101< and !hen the e)change rate of the peso in relation to the >2 dollar is /64b>e. &etitioners contend that the !ords "as far as practicable/" "declining" and "stable" should ha.e been defined in R.A. No. 8180 as they do not set deter"inate or deter"inable standards. The stubborn sub"ission deser.es scant consideration. The dictionary "eanings of these !ords are !ell settled and cannot confuse "en of reasonable intelligence. Aebster defines "practicable" as "eaning possible to practice or perfor"/ "decline" as "eaning to ta0e a do!n!ard direction/ and "stable" as "eaning fir"ly established.'+:( The fear of petitioners that these !ords !ill result in the e)ercise of e)ecuti.e discretion that !ill run riot is thus groundless. To be sure/ the Court has sustained the .alidity of si"ilar/ if not "ore general standards in other cases.'+,( $t ought to follo! that the argu"ent that E.#. No. 68+ is null and .oid as it !as based on indeter"inate standards set by R.A. 8180 "ust li0e!ise fail. $f that !ere all to the attac0 against the .alidity of E.#. No. 68+/ the issue need not further detain our discourse. But petitioners further posit the thesis that the E)ecuti.e "isapplied R.A. No. 8180 !hen it considered the depletion of the #&2% fund as a factor in fully deregulating the do!nstrea" oil industry in %ebruary 1889. A perusal of section 1: of R.A. No. 8180 !ill readily re.eal that it only enu"erated t!o factors to be considered by the epart"ent of Energy and the #ffice of the &resident/ viz.? *1- the ti"e !hen the prices of crude oil and petroleu" products in the !orld "ar0et are declining/ and *+- the ti"e !hen the e)change rate of the peso in relation to the >2 dollar is stable. 2ection 1: did not "ention the depletion of the #&2% fund as a factor to be gi.en !eight by the E)ecuti.e before ordering full deregulation. #n the contrary/ the debates in Congress !ill sho! that so"e of our legislators !anted to i"pose as a pre7condition to deregulation a sho!ing that the #&2% fund "ust not be in deficit. '+9( Ae therefore hold that the E)ecuti.e depart"ent failed to follo! faithfully the standards set by R.A. No. 8180 !hen it considered the e)traneous factor of depletion of the #&2% fund. The "isappreciation of this e)tra factor cannot be <ustified on the ground that the E)ecuti.e depart"ent considered any!ay the stability of the prices of crude oil in the !orld "ar0et and the stability of the e)change rate of the peso to the dollar. By considering another factor to hasten full deregulation/ the E)ecuti.e depart"ent re!rote the standards set forth in R.A. 8180. The E)ecuti.e is bereft of any right to alter either by subtraction or addition the standards set in R.A. No. 8180 for it has no po!er to "a0e la!s. To cede to the E)ecuti.e the po!er to "a0e la! is to in.ite tyranny/ indeed/ to transgress the principle of separation of po!ers. The e)ercise of delegated po!er is gi.en a strict scrutiny by courts for the delegate is a "ere agent !hose action cannot infringe the ter"s of agency. $n the cases at bar/ the E)ecuti.e co7"ingled the factor of depletion of the #&2% fund !ith the factors of decline of the price of crude oil in the !orld "ar0et and the stability of the peso to the >2 dollar. #n the basis of the te)t of E.#. No. 68+/ it is i"possible to deter"ine the !eight gi.en by the E)ecuti.e depart"ent to the depletion of the #&2% fund. $t could !ell be the principal consideration for the early deregulation. $t could ha.e been accorded an e;ual significance. #r its

i"portance could be nil. $n light of this uncertainty/ !e rule that the early deregulation under E.#. No. 68+ constitutes a "isapplication of R.A. No. 8180. Ae no! co"e to grips !ith the contention that so"e pro.isions of R.A. No. 8180 .iolate section 18 of Article I$$ of the 1889 Constitution. These pro.isions are? *1- 2ection : *b- !hich states 7 "Any la! to the contrary not!ithstanding and starting !ith the effecti.ity of this Act/ tariff duty shall be i"posed and collected on i"ported crude oil at the rate of three percent *6B- and i"ported refined petroleu" products at the rate of se.en percent *9B- e)cept fuel oil and C&3/ the rate for !hich shall be the sa"e as that for i"ported crude oil. &ro.ided/ that beginning on Danuary 1/ +001 the tariff rate on i"ported crude oil and refined petroleu" products shall be the sa"e. &ro.ided/ further/ that this pro.ision "ay be a"ended only by an Act of Congress." *+- 2ection , !hich states 7 "To ensure the security and continuity of petroleu" crude and products supply/ the #E shall re;uire the refiners and i"porters to "aintain a "ini"u" in.entory e;ui.alent to ten percent *10B- of their respecti.e annual sales .olu"e or forty *10- days of supply/ !hiche.er is lo!er/" and *6- 2ection 8 *b- !hich states 7 "To ensure fair co"petition and pre.ent cartels and "onopolies in the do!nstrea" oil industry/ the follo!ing acts shall be prohibited? ))) *b&redatory pricing !hich "eans selling or offering to sell any product at a price unreasonably belo! the industry a.erage cost so as to attract custo"ers to the detri"ent of co"petitors." #n the other hand/ section 18 of Article I$$ of the Constitution allegedly .iolated by the aforestated pro.isions of R.A. No. 8180 "andates? "The 2tate shall regulate or prohibit "onopolies !hen the public interest so re;uires. No co"binations in restraint of trade or unfair co"petition shall be allo!ed." A "onopoly is a pri.ilege or peculiar ad.antage .ested in one or "ore persons or co"panies/ consisting in the e)clusi.e right or po!er to carry on a particular business or trade/ "anufacture a particular article/ or control the sale or the !hole supply of a particular co""odity. $t is a for" of "ar0et structure in !hich one or only a fe! fir"s do"inate the total sales of a product or ser.ice. '+8( #n the other hand/ a co"bination in restraint of trade is an agree"ent or understanding bet!een t!o or "ore persons/ in the for" of a contract/ trust/ pool/ holding co"pany/ or other for" of association/ for the purpose of unduly restricting co"petition/ "onopoli5ing trade and co""erce in a certain co""odity/ controlling its

production/ distribution and price/ or other!ise interfering !ith freedo" of trade !ithout statutory authority.'+8( Co"bination in restraint of trade refers to the "eans !hile "onopoly refers to the end.'60( Article 18, of the Re.ised &enal Code and Article +8 of the Ne! Ci.il Code breathe life to this constitutional policy. Article 18, of the Re.ised &enal Code penali5es "onopoli5ation and creation of co"binations in restraint of trade/'61( !hile Article +8 of the Ne! Ci.il Code "a0es any person !ho shall engage in unfair co"petition liable for da"ages. '6+( Respondents a.er that sections :*b-/ , and 8*b- i"ple"ent the policies and ob<ecti.es of R.A. No. 8180. They e)plain that the 1B tariff differential is designed to encourage ne! entrants to in.est in refineries. They stress that the in.entory re;uire"ent is "eant to guaranty continuous do"estic supply of petroleu" and to discourage fly7 by7night operators. They also sub"it that the prohibition against predatory pricing is intended to protect prospecti.e entrants. Respondents "anifested to the Court that ne! players ha.e entered the &hilippines after deregulation and ha.e no! captured 6B 7 :B of the oil "ar0et. The .alidity of the assailed pro.isions of R.A. No. 8180 has to be decided in light of the letter and spirit of our Constitution/ especially section 18/ Article I$$. Beyond doubt/ the Constitution co""itted us to the free enterprise syste" but it is a syste" i"pressed !ith its o!n distinctness. Thus/ !hile the Constitution e"braced free enterprise as an econo"ic creed/ it did not prohibit per se the operation of "onopolies !hich can/ ho!e.er/ be regulated in the public interest. '66( Thus too/ our free enterprise syste" is not based on a "ar0et of pure and unadulterated co"petition !here the 2tate pursues a strict hands7off policy and follo!s the let7the7de.il de.our the hind"ost rule. Co"binations in restraint of trade and unfair co"petitions are absolutely proscribed and the proscription is directed both against the 2tate as !ell as the pri.ate sector. '61( This distinct free enterprise syste" is dictated by the need to achie.e the goals of our national econo"y as defined by section 1/ Article I$$ of the Constitution !hich are? "ore e;uitable distribution of opportunities/ inco"e and !ealth@ a sustained increase in the a"ount of goods and ser.ices produced by the nation for the benefit of the people@ and an e)panding producti.ity as the 0ey to raising the ;uality of life for all/ especially the underpri.ileged. $t also calls for the 2tate to protect %ilipino enterprises against unfair co"petition and trade practices. 2ection 18/ Article I$$ of our Constitution is anti7trust in history and in spirit. $t espouses co"petition. The desirability of co"petition is the reason for the prohibition against restraint of trade/ the reason for the interdiction of unfair co"petition/ and the reason for regulation of un"itigated "onopolies. Co"petition is thus the underlying principle of section 18/ Article I$$ of our Constitution !hich cannot be .iolated by R.A. No. 8180. Ae subscribe to the obser.ation of &rof. Gellhorn that the ob<ecti.e of anti7trust la! is "to assure a co"petiti.e econo"y/ based upon the belief that through co"petition producers !ill stri.e to satisfy consu"er !ants at the lo!est price !ith the sacrifice of the fe!est

resources. Co"petition a"ong producers allo!s consu"ers to bid for goods and ser.ices/ and thus "atches their desires !ith societyGs opportunity costs."'6:( Fe adds !ith appropriateness that there is a reliance upon "the operation of the J"ar0etG syste" *free enterprise- to decide !hat shall be produced/ ho! resources shall be allocated in the production process/ and to !ho" the .arious products !ill be distributed. The "ar0et syste" relies on the consu"er to decide !hat and ho! "uch shall be produced/ and on co"petition/ a"ong producers to deter"ine !ho !ill "anufacture it." Again/ !e underline in scarlet that the funda"ental principle espoused by section 18/ Article I$$ of the Constitution is co"petition for it alone can release the creati.e forces of the "ar0et. But the co"petition that can unleash these creati.e forces is co"petition that is fighting yet is fair. $deally/ this 0ind of co"petition re;uires the presence of not one/ not <ust a fe! but se.eral players. A "ar0et controlled by one player *"onopoly- or do"inated by a handful of players *oligopoly- is hardly the "ar0et !here honest7to7goodness co"petition !ill pre.ail. 4onopolistic or oligopolistic "ar0ets deser.e our careful scrutiny and la!s !hich barricade the entry points of ne! players in the "ar0et should be .ie!ed !ith suspicion. &rescinding fro" these baseline propositions/ !e shall proceed to e)a"ine !hether the pro.isions of R.A. No. 8180 on tariff differential/ in.entory reser.es/ and predatory prices i"posed substantial barriers to the entry and e)it of ne! players in our do!nstrea" oil industry. $f they do/ they ha.e to be struc0 do!n for they !ill necessarily inhibit the for"ation of a truly co"petiti.e "ar0et. Contrari!ise/ if they are insignificant i"pedi"ents/ they need not be stric0en do!n. $n the cases at bar/ it cannot be denied that our do!nstrea" oil industry is operated and controlled by an oligopoly/ a foreign oligopoly at that. &etron/ 2hell and Calte) stand as the only "a<or league players in the oil "ar0et. All other players belong to the lilliputian league. As the do"inant players/ &etron/ 2hell and Calte) boast of e)isting refineries of .arious capacities. The tariff differential of 1B therefore !or0s to their i""ense benefit. Ket/ this is only one edge of the tariff differential. The other edge cuts and cuts deep in the heart of their co"petitors. $t erects a high barrier to the entry of ne! players. Ne! players that intend to e;uali5e the "ar0et po!er of &etron/ 2hell and Calte) by building refineries of their o!n !ill ha.e to spend billions of pesos. Those !ho !ill not build refineries but co"pete !ith the" !ill suffer the huge disad.antage of increasing their product cost by 1B. They !ill be co"peting on an une.en field. The argu"ent that the 1B tariff differential is desirable because it !ill induce prospecti.e players to in.est in refineries puts the cart before the horse. The first need is to attract ne! players and they cannot be attracted by burdening the" !ith hea.y disincenti.es. Aithout ne! players belonging to the league of &etron/ 2hell and Calte)/ co"petition in our do!nstrea" oil industry is an idle drea". The pro.ision on in.entory !idens the balance of ad.antage of &etron/ 2hell and Calte) against prospecti.e ne! players. &etron/

2hell and Calte) can easily co"ply !ith the in.entory re;uire"ent of R.A. No. 8180 in .ie! of their e)isting storage facilities. &rospecti.e co"petitors again !ill find co"pliance !ith this re;uire"ent difficult as it !ill entail a prohibiti.e cost. The construction cost of storage facilities and the cost of in.entory can thus scare prospecti.e players. Their net effect is to further occlude the entry points of ne! players/ da"pen co"petition and enhance the control of the "ar0et by the three *6- e)isting oil co"panies. %inally/ !e co"e to the pro.ision on predatory pricing !hich is defined as ") ) ) selling or offering to sell any product at a price unreasonably belo! the industry a.erage cost so as to attract custo"ers to the detri"ent of co"petitors." Respondents contend that this pro.ision !or0s against &etron/ 2hell and Calte) and protects ne! entrants. The ban on predatory pricing cannot be analy5ed in isolation. $ts .alidity is interloc0ed !ith the barriers i"posed by R.A. No. 8180 on the entry of ne! players. The in;uiry should be to deter"ine !hether predatory pricing on the part of the do"inant oil co"panies is encouraged by the pro.isions in the la! bloc0ing the entry of ne! players. Te)t7!riter *ovenkamp/ '6,( gi.es the authoritati.e ans!er and !e ;uote? ") ) ) "The rationale for predatory pricing is the sustaining of losses today that !ill gi.e a fir" "onopoly profits in the future. The "onopoly profits !ill ne.er "ateriali5e/ ho!e.er/ if the "ar0et is flooded !ith ne! entrants as soon as the successful predator atte"pts to raise its price. #re?46or7 5r0301< @0>> be 5ro;064b>e o1>7 0; 62e m4rDe6 3o16401/ /0<10;03416 b4rr0er/ 6o 1e@ e16r7." As aforediscussed/ the 1B tariff differential and the in.entory re;uire"ent are significant barriers !hich discourage ne! players to enter the "ar0et. Considering these significant barriers established by R.A. No. 8180 and the lac0 of players !ith the co"parable clout of &ETR#N/ 2FECC and CACTEI/ the te"ptation for a do"inant player to engage in predatory pricing and succeed is a chilling reality. &etitionersG charge that this pro.ision on predatory pricing is anti7co"petiti.e is not !ithout reason. Respondents belittle these barriers !ith the allegation that ne! players ha.e entered the "ar0et since deregulation. A scrutiny of the list of the alleged ne! players !ill/ ho!e.er/ re.eal that not one belongs to the class and category of &ETR#N/ 2FECC and CACTEI. $ndeed/ there is no sho!ing that any of these ne! players intends to install any refinery and effecti.ely co"pete !ith these do"inant oil co"panies. $n any e.ent/ it cannot be gainsaid that the ne! players could ha.e been "ore in nu"ber and "ore i"pressi.e in "ight if the illegal entry barriers in R.A. No. 8180 !ere not erected. Ae co"e to the final point. Ae no! resol.e the 6o64> e;;e36 of the unti"ely deregulation/ the i"position of 1B tariff differential on i"ported

crude oil and refined petroleu" products/ the re;uire"ent of in.entory and the prohibition on predatory pricing on the constitutionality of R.A. No. 8180. The ;uestion is !hether these offending pro.isions can be indi.idually struc0 do!n !ithout in.alidating the entire R.A. No. 8180. The ruling case la! is !ell stated by author Agpalo/'69( viz.? ") ) ) The <e1er4> r9>e is that !here part of a statute is .oid as repugnant to the Constitution/ !hile another part is .alid/ the .alid portion/ if separable fro" the in.alid/ "ay stand and be enforced. The presence of a separability clause in a statute creates the presu"ption that the legislature intended separability/ rather than co"plete nullity of the statute. To <ustify this result/ the .alid portion "ust be so far independent of the in.alid portion that it is fair to presu"e that the legislature !ould ha.e enacted it by itself if it had supposed that it could not constitutionally enact the other. Enough "ust re"ain to "a0e a co"plete/ intelligible and .alid statute/ !hich carries out the legislati.e intent. ) ) ) The e83e560o1 6o 62e <e1er4> r9>e is that !hen the parts of a statute are so "utually dependent and connected/ as conditions/ considerations/ induce"ents/ or co"pensations for each other/ as to !arrant a belief that the legislature intended the" as a !hole/ the nullity of one part !ill .itiate the rest. $n "a0ing the parts of the statute dependent/ conditional/ or connected !ith one another/ the legislature intended the statute to be carried out as a !hole and !ould not ha.e enacted it if one part is .oid/ in !hich case if so"e parts are unconstitutional/ all the other pro.isions thus dependent/ conditional/ or connected "ust fall !ith the"." R.A. No. 8180 contains a separability clause. 2ection +6 pro.ides that "if for any reason/ any section or pro.ision of this Act is declared unconstitutional or in.alid/ such parts not affected thereby shall re"ain in full force and effect." This separability clause not!ithstanding/ !e hold that the offending pro.isions of R.A. No. 8180 so per"eate its essence that the entire la! has to be struc0 do!n. The pro.isions on tariff differential/ in.entory and predatory pricing are a"ong the principal props of R.A. No. 8180. Congress could not ha.e deregulated the do!nstrea" oil industry !ithout these pro.isions. >nfortunately/ contrary to their intent/ these pro.isions on tariff differential/ in.entory and predatory pricing inhibit fair co"petition/ encourage "onopolistic po!er and interfere !ith the free interaction of "ar0et forces. R.A. No. 8180 needs pro.isions to .ouchsafe free and fair co"petition. The need for these .ouchsafing pro.isions cannot be o.erstated. ,e;ore ?ere<9>460o1/ &ETR#N/ 2FECC and CACTEI had no real co"petitors but did not ha.e a free run of the "ar0et because go.ern"ent controls both the pricing and non7pricing aspects of the oil industry. A;6er ?ere<9>460o1/ &ETR#N/ 2FECC and CACTEI re"ain unthreatened by real co"petition yet are no longer sub<ect to control by go.ern"ent !ith respect to their pricing and non7pricing decisions. The after"ath of R.A. No. 8180 is a deregulated

"ar0et !here co"petition can be corrupted and !here "ar0et forces can be "anipulated by oligopolies. The fall out effects of the defects of R.A. No. 8180 on our people ha.e not escaped Congress. A lot of our leading legislators ha.e co"e out openly !ith b0>>/ see0ing the repeal of these odious and offensi.e pro.isions in R.A. No. 8180. $n the 2enate/ Se146or Fre??0e +ebb has filed 2.B. No. +166 !hich is the result of the hearings conducted by the 2enate Co""ittee on Energy. The hearings re.ealed that *1- 62ere @4/ 4 1ee? 6o >eve> 62e 5>4701< ;0e>? ;or 62e 1e@ e16r416/ 01 62e ?o@1/6re4m o0> 01?9/6r7/ and *+- there !as no la! punishing a person for selling petroleu" products at unreasonable prices. Se146or A>ber6o G. Rom9>o also filed 2.B. No. ++08 abolishing the tariff differential beginning Danuary 1/ 1888. Fe declared that the a"end"ent ") ) ) @o9>? me41 6246 01/6e4? o; E9/6 62ree -3. b0< o0> 3om5410e/ 62ere @0>> be o62er m4Eor o0> 3om5410e/ 6o 5rov0?e more 3om5e6060ve 5r03e/ ;or 62e m4rDe6 41? 62e 3o1/9m01< 59b>03." Se146or e2er/o1 T. A>v4reA, one of the 5r013054> 5ro5o1e16/ of R.A. No. 8180/ also filed 2.B. No. ++80 increasing the penalty for .iolation of its section 8. $t is his opinion as e)pressed in the e)planatory note of the bill that 62e 5re/e16 o0> 3om5410e/ 4re e1<4<e? 01 34r6e>0A460o1 ?e/506e R.A. No. %1%0, vi+/? "))) "2ince the do!nstrea" oil industry !as fully deregulated in %ebruary 1889/ there ha.e been eight *8- fuel price ad<ust"ents "ade by the three oil "a<ors/ na"ely? Calte) &hilippines/ $nc.@ &etron Corporation@ and &ilipinas 2hell &etroleu" Corporation. Eery noticeable in the price ad<ust"ents "ade/ ho!e.er/ is the unifor"ity in the pu"p prices of practically all petroleu" products of the three oil co"panies. This/ despite the fact/ that their selling rates should be deter"ined by a co"bination of any of the follo!ing factors? the pre.ailing peso7dollar e)change rate at the ti"e pay"ent is "ade for crude purchases/ sources of crude/ and in.entory le.els of both crude and refined petroleu" products. The abo.estated factors should ha.e resulted in different/ rather than identical prices. T2e ;436 6246 62e 62ree -3. o0> 3om5410e/F 5e6ro>e9m 5ro?936/ 4re 910;orm>7 5r03e? /9<<e/6/ 3o>>9/0o1/ a"ounting to carteli5ation/ a"ong Calte) &hilippines/ $nc./ &etron Corporation and &ilipinas 2hell &etroleu" Corporation to fi) the prices of petroleu" products in .iolation of paragraph *a-/ 2ection 8 of R.A. No. 8180. To ?e6er 620/ 5er1030o9/ 5r43603e 41? 6o 4//9re 6246 5re/e16 41? 5ro/5e360ve 5>47er/ 01 62e ?o@1/6re4m o0> 01?9/6r7 3o1?936 62e0r b9/01e// @062 3o1/30e13e 41? 5ro5r0e67, 34r6e>C>0De 4360v060e/ o9<26 6o be /evere>7 5e14>0Ae?." Se146or Fr4130/3o S. T464? also filed 2.B. No. +609 pro.iding for a unifor" tariff rate on i"ported crude oil and refined petroleu"

products. $n the e)planatory note of the bill/ he declared in no uncertain ter"s that ") ) ) 62e 5re/e16 /e6C95 has raised serious public concern o.er the !ay the three oil co"panies ha.e unifor"ly ad<usted the prices of oil in the country/ 41 01?03460o1 o; 4 5o//0b>e e80/6e13e o; 4 34r6e> or 4 34r6e>C>0De /069460o1 @06201 62e ?o@1/6re4m o0> 01?9/6r7. T20/ /069460o1 0/ mo/6>7 466r0b96e? 6o 62e ;ore<o01< 5rov0/0o1 o1 64r0;; ?0;;ere1604>, @2032 24/ e;;e360ve>7 ?0/3o9r4<e? 62e e16r7 o; 1e@ 5>47er/ 01 62e ?o@1/6re4m o0> 01?9/6r7." I1 62e o9/e o; Re5re/e16460ve/ / the "o.es to rehabilitate R.A. No. 8180 are e;ually fe.erish. Re5re/e16460ve &eo5o>?o !. S41 ,9e14ve169r4 has filed F.B. No. 88+, re"o.ing the tariff differential for i"ported crude oil and i"ported refined petroleu" products. $n the e)planatory note of the bill/ Rep. Buena.entura e)plained? ") ) ) As !e no! e)perience/ this difference in tariff rates bet!een i"ported crude oil and i"ported refined petroleu" products/ 91@06601<>7 5rov0?e? 4 b90>6C01C4?v4164<e ;or 62e 62ree e80/601< o0> re;01er0e/ 01 62e 3o916r7 41? e>0m014601< 3om5e6060o1 @2032 0/ 4 m9/6 01 4 ;ree e16er5r0/e e3o1om7. 4oreo.er/ it created a disincenti.e for other players to engage e.en initially in the i"portation and distribution of refined petroleu" products and ulti"ately in the putting up of refineries. T20/ 64r0;; ?0;;ere1604> v0r694>>7 3re46e? 4 mo1o5o>7 o; 62e ?o@1/6re4m o0> 01?9/6r7 b7 62e e80/601< 62ree o0> 3om5410e/ as sho!n by their unifor" and capricious pricing of their products since this la! too0 effect/ to the great disad.antage of the consu"ing public. T29/, 01/6e4? o; 4320ev01< 62e ?e/0re? e;;e36/ o; ?ere<9>460o1, 6246 o; ;ree e16er5r0/e 41? 4 >eve> 5>4701< ;0e>? 01 62e ?o@1/6re4m o0> 01?9/6r7, R.A. %1%0 24/ 3re46e? 41 e1v0ro1me16 3o1?930ve 6o 34r6e>0A460o1, 91;4vor4b>e, 013re4/e?, 91re4>0/603 5r03e/ o; 5e6ro>e9m 5ro?936/ 01 62e 3o916r7 b7 62e 62ree e80/601< re;01er0e/." Re5re/e16460ve $4r304> C. #91A4>41, 'r., filed F.B. No. 8881 to pre.ent collusion a"ong the present oil co"panies by strengthening the o.ersight function of the go.ern"ent/ particularly its ability to sub<ect to a re.ie! any ad<ust"ent in the prices of gasoline and other petroleu" products. $n the e)planatory note of the bill/ Rep. &un5alan/ Dr./ said? ") ) ) To a.oid this/ the proposed bill see0s to strengthen the o.ersight function of go.ern"ent/ particularly its ability to re.ie! the prices set for gasoline and other petroleu" products. $t grants the Energy Regulatory Board *ERB- the authority to re.ie! prices of oil and other petroleu" products/ as "ay be petitioned by a person/ group or any entity/ and to subse;uently

co"pel any entity in the industry to sub"it any and all docu"ents rele.ant to the i"position of ne! prices. $n cases !here the Board deter"ines that there e)ist collusion/ econo"ic conspiracy/ unfair trade practice/ profiteering and=or o.erpricing/ it "ay ta0e any step necessary to protect the public/ including the read<ust"ent of the prices of petroleu" products. %urther/ the Board "ay also i"pose the fine and penalty of i"prison"ent/ as prescribed in 2ection 8 of R.A. 8180/ on any person or entity fro" the oil industry !ho is found guilty of such prohibited acts. By doing all of the abo.e/ the "easure !ill effecti.ely pro.ide %ilipino consu"ers !ith a .enue !here their grie.ances can be heard and i""ediately acted upon by go.ern"ent. Thus/ this bill stands to benefit the %ilipino consu"er by "a0ing the price7 setting process "ore transparent and "a0ing it easier to prosecute those !ho perpetrate such prohibited acts as collusion/ o.erpricing/ econo"ic conspiracy and unfair trade." Re5re/e16460ve Ser<0o A.F. A5o/6o> filed F.B. No. 10068 to re"edy an o"ission in R.A. No. 8180 !here there is no agency in go.ern"ent that deter"ines !hat is "reasonable" increase in the prices of oil products. Re5re/e16460ve D416e O. T01<4/ one of the 5r013054> /5o1/or/ of R.A. No. 8180/ filed F.B. No. 100:9 to strengthen its anti7 trust pro.isions. Fe elucidated in its e)planatory note? L) ) ) The definition of predatory pricing/ ho!e.er/ needs to be tightened up particularly !ith respect to the definiti.e bench"ar0 price and the specific anti7co"petiti.e intent. The definition in the bill at hand !hich !as ta0en fro" the Areeda7TurnerM test in the >nited 2tates on predatory pricing resol.es the ;uestions. The definition reads/ J&redatory pricing "eans selling or offering to sell any oil product at a price belo! the a.erage .ariable cost for the purpose of destroying co"petition/ eli"inating a co"petitor or discouraging a co"petitor fro" entering the "ar0et.G The appropriate actions !hich "ay be resorted to under the Rules of Court in con<unction !ith the oil deregulation la! are ade;uate. But to stress their a.ailability and dyna"is"/ it is a good "o.e to incorporate all the re"edies in the la! itself. Thus/ the present bill for"ali5es the concept of go.ern"ent inter.ention and pri.ate suits to address the proble" of antitrust .iolations. 2pecifically/ the go.ern"ent "ay file an action to pre.ent or restrain any act of carteli5ation or predatory pricing/ and if it has suffered any loss or da"age by reason of the antitrust .iolation it "ay reco.er da"ages. Ci0e!ise/ a pri.ate person or entity "ay sue to pre.ent or restrain any such .iolation !hich !ill result in da"age to his business or property/ and if he has already suffered da"age he shall reco.er treble da"ages. A class suit "ay also be allo!ed.

To "a0e the #E 2ecretary "ore effecti.e in the enforce"ent of the la!/ he shall be gi.en additional po!ers to gather infor"ation and to re;uire reports." Re5re/e16460ve !r4/mo ,. D4m4/01< filed F.B. No. 988: and has a "ore unforgi.ing .ie! of R.A. No. 8180. Fe !ants it co"pletely repealed. Fe e)plained? ") ) ) Contrary to the pro<ections at the ti"e the bill on the o!nstrea" #il $ndustry eregulation !as discussed and debated upon in the plenary session prior to its appro.al into la!/ there arenGt any ne! players or in.estors in the oil industry. Thus/ resulting in practically a cartel or "onopoly in the oil industry by the three *6- big oil co"panies/ Calte)/ 2hell and &etron. 2o "uch so/ that !ith the deregulation no! being partially i"ple"ented/ the said oil co"panies ha.e succeeded in increasing the prices of "ost of their petroleu" products !ith little or no interference at all fro" the go.ern"ent. $n the "onth of August/ there !as an increase of %ifty centa.os *:0N- per liter by subsidi5ing the sa"e !ith the #&2%/ this is only te"porary as in 4arch 1889/ or a fe! "onths fro" no!/ there !ill be full deregulation *&hase $$- !hereby the increase in the prices of petroleu" products !ill be fully absorbed by the consu"ers since #&2% !ill already be abolished by then. Certainly/ this !ould "a0e the li.es of our people/ especially the une"ployed ones/ doubly difficult and unbearable. T2e m932 b4>>72ooe? 3om01< 01 o; 1e@ 5>47er/ 01 62e o0> 01?9/6r7 0/ G906e remo6e 3o1/0?er01< 6246 62e/e 5ro/5e360ve 01ve/6or/ 3411o6 ;0<26 62e e80/601< 41? @e>> e/64b>0/2e? o0> 3om5410e/ 01 62e 3o916r7 6o?47, 14me>7, C4>6e8, S2e>> 41? #e6ro1. !ve1 0; 62e/e 1e@ 5>47er/ @0>> 3ome 01, 62e7 @0>> /60>> 24ve 1o 32413e 6o 3om5e6e @062 62e /40? 62ree -3. e80/601< b0< o0> 3om5410e/ considering that there is an i"position of oil tariff differential of 1B bet!een i"portation of crude oil by the said oil refineries paying only 6B tariff rate for the said i"portation and 9B tariff rate to be paid by business"en !ho ha.e no oil refineries in the &hilippines but !ill i"port finished petroleu"=oil products !hich is being ta)ed !ith 9B tariff rates. So, 0; o1>7 6o 2e>5 62e m417 @2o 4re 5oor ;rom ;9r62er /9;;er01< 4/ 4 re/9>6 o; 91m060<46e? 013re4/e 01 o0> 5ro?936/ ?9e 6o ?ere<9>460o1, 06 0/ 4 m9/6 6246 62e Do@1/6re4m O0> I1?9/6r7 Dere<9>460o1 A36 o; 1996, or R.A. %1%0 be re5e4>e? 3om5>e6e>7." Earious re/o>960o1/ ha.e also been filed in the 2enate calling for an 0mme?046e 41? 3om5re2e1/0ve rev0e@ of R.A. No. 8180 to pre.ent the do!npour of its ill effects on the people. Thus/ 2. Res. No. :91 !as filed by Se146or G>or04 $. $43454<4> entitled Resolution " irecting the Co""ittee on Energy to $n;uire $nto The &roper

$"ple"entation of the eregulation of the o!nstrea" #il $ndustry and #il Ta) Restructuring As 4andated >nder R.A. Nos. 8180 and 8181/ $n #rder to 4a0e The Necessary Corrections $n the Apparent 4isinterpretation #f The $ntent And &ro.ision #f The Ca!s And Curb The Rising Tide #f isenchant"ent A"ong The %ilipino Consu"ers And Bring About The Real $ntentions And Benefits #f The 2aid Ca!." Se146or ,>4/ #. O5>e filed 2. Res. No. ,,1 entitled resolution " irecting the Co""ittee on Energy To Conduct An $n;uiry $n Aid #f Cegislation To Re.ie! The 3o.ern"entGs #il eregulation &olicy $n Cight #f The 2uccessi.e $ncreases $n Transportation/ Electricity And &o!er Rates/ As !ell As #f %ood And #ther &ri"e Co""odities And Reco""end Appropriate A"end"ents To &rotect The Consu"ing &ublic." 2enator #ple obser.ed? ") ) ) AFEREA2/ since the passage of R.A. No. 8180/ the Energy Regulatory Board *ERB- has i"posed successi.e increases in oil prices !hich has triggered increases in electricity and po!er rates/ transportation fares/ as !ell as in prices of food and other pri"e co""odities to the detri"ent of our people/ particularly the poor@ + !R!AS, 62e 1e@ 5>47er/ 6246 @ere e85e36e? 6o 3om5e6e @062 62e o0> 34r6e>CS2e>>, C4>6e8 41? #e6ro1C24ve 1o6 3ome 01H AFEREA2/ it is i"perati.e that a re.ie! of the oil deregulation policy be "ade to consider appropriate a"end"ents to the e)isting la! such as an e)tension of the transition phase before full deregulation in order 6o <0ve 62e 3om5e6060ve m4rDe6 e1o9<2 60me 6o ?eve>o5@ AFEREA2/ the re.ie! can include the ad.isability of pro.iding so"e incenti.es in order to attract the entry of ne! oil co"panies to effect a dyna"ic co"petiti.e "ar0et@ AFEREA2/ it "ay also be necessary to defer the setting up of the institutional fra"e!or0 for full deregulation of the oil industry as "andated under E)ecuti.e #rder No. 699 issued by &resident Ra"os last #ctober 61/ 188, ) ) ). " Se146or A>ber6o G. Rom9>o filed 2. Res. No. 9,8 entitled resolution " irecting the Co""ittees on Energy and &ublic 2er.ices $n Aid #f Cegislation To Assess The $""ediate 4ediu" And Cong Ter" $"pact of #il eregulation #n #il &rices And The Econo"y." A"ong the reasons for the resolution is the finding that "62e reG90reme16 o; 4 40C?47 /6o3D 01ve16or7 e;;e360ve>7 >0m06/ 62e e16r7 o; o62er o0> ;0rm/ 01 62e m4rDe6 @062 62e 3o1/eG9e13e 6246 01/6e4? o; <o01< ?o@1 o0> 5r03e/ @0>> r0/e." #4r4>>e> re/o>960o1/ 24ve bee1 ;0>e? 01 62e o9/e o; Re5re/e16460ve/. Re5re/e16460ve D416e O. T01<4 filed F. Res. No.

1611 " irecting The Co""ittee on Energy To Conduct An $n;uiry/ $n Aid of Cegislation/ $nto The &ricing &olicies And ecisions #f The #il Co"panies 2ince The $"ple"entation of %ull eregulation >nder the #il eregulation Act *R.A. No. 8180- %or the &urpose of eter"ining $n the Conte)t #f The #.ersight %unctions #f Congress Ahether The Conduct #f The #il Co"panies/ Ahether 2ingly #r Collecti.ely/ Constitutes Carteli5ation Ahich $s A &rohibited Act >nder R.A. No. 8180/ And Ahat 4easures 2hould Be Ta0en To Felp Ensure The 2uccessful $"ple"entation #f The Ca! $n Accordance Aith $ts Cetter And 2pirit/ $ncluding Reco""ending Cri"inal &rosecution #f the #fficers Concerned #f the #il Co"panies $f Aarranted By The E.idence/ And %or #ther &urposes." Re5re/e16460ve/ $4r304> C. #91A4>41, 'r. D416e O. T01<4 41? A16o10o !. ,e1<Ao1 III filed F.R. No. 881 directing the Fouse Co""ittee on Energy to in;uire into the proper i"ple"entation of the deregulation of the do!nstrea" oil industry. Fouse Resolution No. 1016 !as also filed by Re5re/e16460ve/ !?3e> C. &4<m41, !1r0G9e T. G4r304, 'r. 41? 'oDer #. Arro7o urging the &resident to i""ediately suspend the i"ple"entation of E.#. No. 68+. $n recent "e"ory there is no la! enacted by the legislature afflicted !ith so "uch constitutional defor"ities as R.A. No. 8180. Ket/ R.A. No. 8180 deals !ith oil/ a co""odity !hose supply and price affect the ebb and flo! of the lifeblood of the nation. $ts shortage of supply or a slight/ up!ard spiral in its price sha0es our econo"ic foundation. 2tudies sho! that the areas "ost i"pacted by the "o.e"ent of oil are food "anufacture/ land transport/ trade/ electricity and !ater. '68( A6 4 60me @2e1 o9r e3o1om7 0/ 01 4 ?41<ero9/ ?o@1/501, 62e 5er5e69460o1 o; R.A. No. %1%0 62re46e1/ 6o m9>605>7 62e 19mber o; o9r 5eo5>e @062 be16 b43D/ 41? be<<01< bo@>/. R.A. No. %1%0 @062 06/ 4160C 3om5e6060o1 5rov0/0o1/ 3411o6 be 4>>o@e? b7 620/ Co9r6 6o /641? eve1 @20>e Co1<re// 0/ @orD01< 6o reme?7 06/ ?e;e36 s. The Court/ ho!e.er/ ta0es note of the plea of &ETR#N/ 2FECC and CACTEI to lift our restraining order to enable the" to ad<ust up!ard the price of petroleu" and petroleu" products in .ie! of the plu""eting .alue of the peso. Their plea/ ho!e.er/ !ill no! ha.e to be addressed to the Energy Regulatory Board as the effect of the declaration of unconstitutionality of R.A. No. 8180 is to re.i.e the for"er la!s it repealed. '68( The length of our return to the regi"e of regulation depends on Congress !hich can fasttrac0 the !riting of a ne! la! on oil deregulation in accord !ith the Constitution. Aith this ecision/ so"e circles !ill chide the Court for interfering !ith an econo"ic decision of Congress. 2uch criticis" is char"less for the Court is annulling R.A. No. 8180 not because it disagrees !ith deregulation as an econo"ic policy but because as cobbled by Congress in its present for"/ the la! .iolates the Constitution. The right call therefor should be for Congress to !rite a ne! oil deregulation la! that confor"s !ith the Constitution and not for this Court to shir0 its duty of stri0ing do!n a la! that offends the Constitution. 2tri0ing do!n R.A. No. 8180 "ay cost losses in ;uantifiable ter"s to the oil oligopolists. But the loss in tolerating the ta"pering of our Constitution is not ;uantifiable in pesos and centa.os. 4ore !orthy of protection than the supra7nor"al profits of

pri.ate corporations is the sanctity of the funda"ental principles of the Constitution. $ndeed !hen confronted by a la! .iolating the Constitution/ the Court has no option but to stri0e it do!n dead. Cest it is "issed/ the Constitution is a co.enant that grants and guarantees bo62 the political and e3o1om03 r0<26/ o; 62e 5eo5>e. The Constitution "andates this Court to be the guardian not only of the peopleGs political rights but their econo"ic rights as !ell. The protection of the econo"ic rights of the poor and the po!erless is of greater i"portance to the" for they are concerned "ore !ith the e)oterics of li.ing and less !ith the esoterics of liberty. Fence/ for as long as the Constitution reigns supre"e so long !ill this Court be .igilant in upholding the econo"ic rights of our people especially fro" the onslaught of the po!erful. #ur defense of the peopleGs econo"ic rights "ay appear heartless because it cannot be half7hearted. IN :I!+ + !R!OF/ the petitions are granted. R.A. No. 8180 is declared unconstitutional and E.#. No. 69+ .oid. SO ORD!R!D. Regalado, (Acting Chief Justice), Bellosillo, and Vitug, JJ., concur. Narvasa, C.J./ on official lea.e. elo, J., see dissenting opinion. !a"unan, J., see concurring opinion. endoza, J., in the result. #rancisco, J., see dissenting opinion. $angani%an, J., see concurring opinion. Davide, Jr., Romero,

'8( '8(

2ection 6/ E.#. No. 19+. R.A. No. 9,68. 2ection :*b-/ R.A. No. 9,68. 2ection :/ R.A. No. 8180. 2ection 1/ Article E$$$/ 1889 Constitution. Bondoc v. &ineda/ +01 2CRA 98+ *1881-@ #s"ena v. C#4ECEC/ 188 2CRA 9:0 *1881-. 3.R. No. 118+8:/ 4ay +/ 1889. E.g. 3arcia v. E)ecuti.e 2ecretary/ +11 2CRA +18 *18++-@ #s"ena v. C#4ECEC/ 188 2CRA *1881-@ Basco v. &agcor/ 189 2CRA :+ *1881-@ a5a v. 2ingson/ 180 2CRA 18, *1888-/ Araneta v. inglasan/ 81 &hil. 6,8 *1818-.

'10( '11( '1+( '16(

'11( '1:(

'1,( '19(

1,6 2CRA 691 *1888-. 2ection +,*1- Article E$ of the 1889 Constitution pro.ides that "e.ery bill passed by the Congress shall e"brace only one sub<ect !hich shall be e)pressed in the title thereof." Tobias v. Abalos/ +68 2CRA 10, *1881-@ &hilippine Dudges Association v. &rado/ ++9 2CRA 906 *1886-@ Cidasan v. C#4ECEC/ +1 2CRA 18, *18,9-. Tio v. Eideogra" Regulatory Board/ 1:1 2CRA +08 *1889-. Dournal of the Fouse of Representati.es/ ece"ber 16/ 188:/ p. 6+.

'18(

'18( '+0(

'1(

o!nstrea" oil industry refers to the business of i"porting/ e)porting/ re7e)porting/ shipping/ transporting/ processing/ refining/ storing/ distributing/ "ar0eting and=or selling crude oil/ gasoline/ diesel/ li;uefied petroleu" gas/ 0erosene and other petroleu" and crude oil products. &aderanga O &aderanga/ Dr./ The #il $ndustry in the &hilippines/ &hilippine Econo"ic Dournal/ No. ,:/ Eol. +9/ pp. +9788 '1888(. 2ection 6/ R.A. No. ,196. 2ection 9/ R.A. No. ,196. &. . No. 661. 4a0asiar/ 3./ 2tructural Response to the Energy Crisis? The &hilippine Case. Energy and 2tructural Change in the Asia &acific Region? &apers and &roceedings of the 16th &acific Trade and e.elop"ent Conference. &ublished by the &hilippine $nstitute for e.elop"ent 2tudies=Asian e.elop"ent Ban0 and edited by Ro"eo 4. Bautista and 2ei<i Naya/ pp. 611761+ *1881-. &. . 18:, as a"ended by E.#. 169.

'+1(

61 &hil. 16, citing Cincinnati/ A. O P. R.R. Co. vs. Clinton Country Co""rs. *1 #hio 2t. 991,, 2CRA :66/ :167:11. 6+0 >2 88. &hilippine &olitical Ca!/ 188: ed./ p. 88. Aebster/ Ne! Third $nternational and ++18. ictionary/ 1886 ed./ pp. 1980/ :8,

'++( '+6( '+1( '+:(

'+(

'6( '1( ':( ',(

'+,(

2ee e.g./ Balbuena v. 2ecretary of Education/ 110 &hil. 1:0 used the standard "si"plicity and dignity." &eople v. Rosenthal/ ,8 &hil. 6+8 *"public interest"-@ Calalang v. Aillia"s/ 90 &hil. 9+, *"public !elfare"-@ Rubi v. &ro.incial Board of 4indoro/ 68 &hil. ,,8 *"interest of la! and order"-. 2ee for e)a"ple T2N of the 2ession of the 2enate on No.e"ber 11/ 188:/ p. 18/ .ie! of 2enator 3loria 4. Arroyo. Blac0Gs Ca! &d./ p. +,,. ictionary/ ,th edition/ p. 1009.

'+9(

'+8( '+8(

'9(

'60( '61(

:1 A" Dur +d ,,8. Art. 18,. 4onopolies and co"binations in restraint of trade. 77 The penalty of "rision correccional in its "ini"u" period or a fine ranging fro" +00 to ,/000 pesos/ or both/ shall be i"posed upon? Any person !ho shall enter into any contract or agree"ent or shall ta0e part in any conspiracy or co"bination in the for" of a trust or other!ise/ in restraint of trade or co""erce to pre.ent by artificial "eans free co"petition in the "ar0et. Any person !ho shall "onopoli5e any "erchandise or ob<ect of trade or co""erce/ or shall co"bine !ith any other person or persons to "onopoli5e said "erchandise or ob<ect in order to alter the price thereof by spreading false ru"ors or "a0ing use of any other article to restrain free co"petition in the "ar0et@ Any person !ho/ being a "anufacturer/ producer/ or processor of any "erchandise or ob<ect of co""erce or an i"porter of any "erchandise or ob<ect of co""erce fro" any foreign country/ either as principal or agent/ !holesaler or retailer/ shall co"bine/ conspire or agree in any "anner !ith any person li0e!ise engaged in the "anufacture/ production/ processing/ asse"bling or i"portation of such "erchandise or ob<ect of co""erce or !ith any other persons not so si"ilarly engaged for the purpose of "a0ing transactions pre<udicial to la!ful co""erce/ or of increasing the "ar0et price in any part of the &hilippines/ or any such "erchandise or ob<ect of co""erce "anufactured/ produced/ or processed/ asse"bled in or i"ported into the &hilippines/ or of any article in the "anufacture of !hich such "anufactured/ produced/ processed/ or i"ported "erchandise or ob<ect of co""erce is used.

'66(

1.

Bernas/ The $ntent of the 188, Constitution Ariters *188:-/ p. 899@ &hilippine Cong istance Telephone Co. v. National Teleco""unications Co""ission/ 180 2CRA 919 *1880-@ Northern Ce"ent Corporation v. $nter"ediate Appellate Court/ 1:8 2CRA 108 *1888-@ &hilippine &orts Authority v. 4endo5a/ 168 2CRA 18, *188:-@ Anglo7%il Trading Corporation v. Ca5aro/ 1+1 2CRA 181 *1886-. Record of the Constitutional Co""ission/ Eolu"e $$$/ p. +:8. (ellhorn/ Anti Trust Ca! and Econo"ics in a Nutshell/ 188, ed. p. 1:. Econo"ics and %ederal Anti7Trust Ca!/ Fornboo0 2eries/ 2tudent ed./ 188: ed./ p. 181. 2tatutory Construction/ 188, ed./ pp. +87+8. $B#N %acts and %igures/ Eol. 18/ No. 9/ p. :/ April 1:/ 188:. Cru5 v. Koungberg/ :, &hil. +61 *1861-.

'61( '6:( '6,(

+.

'69( '68( '68(

6.

$f the offense "entioned in this article affects any food substance/ "otor fuel or lubricants/ or other articles of pri"e necessity the penalty shall be that of "rision ma'or in its "a)i"u" and "ediu" periods/ it being sufficient for the i"position thereof that the initial steps ha.e been ta0en to!ard carrying out the purposes of the co"bination. ))) Ahene.er any of the offenses described abo.e is co""itted by a corporation or association/ the president and each one of the directors or "anagers of said corporation or association/ !ho shall ha.e 0no!ingly per"itted or failed to pre.ent the co""ission of such offenses/ shall be held liable as principals thereof.
'6+(

Art. +8. >nfair co"petition in agricultural/ co""ercial or industrial enterprises or in labor through the use of force/ inti"idation/ deceit/ "achination or any other un<ust/ oppressi.e or highhanded "ethod shall gi.e rise to a right of action by the person !ho thereby suffers da"age.