LEGAL CHALLENGES AND OPPORTUNITIES OF ASEAN ECONOMIC

INTEGRATION BY 2015
ALVIN H. EBREO, LLB-4
There is a very strong storm that is brewing around the West Philippine Sea that will
surely blow away anything that is not prepared for its coming; its name is ASEAN
economic integration. This integration envisions an integrated ASEAN characterized
by a single market and production base, with free flow of goods, services,
investment and skilled labour, and freer flow of capital by 2020.

EXCITING

TIMES

We are living in exciting times as the economy is projected to chart a sustainable

growth in the years to come and with the much coveted investment grade rating of
the country within grasp. While the economic performance in the Eurozone area is
dismal and that of China slowing down, the countrys economy shows great
resilience by posting the second best Gross Domestic Product (GDP) growth in the
region. Indeed, we may be poised to become Asias next tiger economy and this is
one reason we all should be excited of. With this prevailing economic climate and
the impending ASEAN economic integration by 2015, sweeping and unprecedented
rise in legal issues with foreign element may be in the offing.
To give you a glimpse of that medium term future, just few years from now,
hereunder are the different scenarios that may greatly impact legal practice in the
country. Consider the influx of resident and non-resident aliens who will be regularly
conducting their business in the country. The corollary rise in the economic activities
of Filipinos within the ASEAN will likewise be expected. It would be inevitable that in
the course of these business activities that contracts will be entered into in a scale
never seen before. Here our lawyers will be at the forefront in the preparation of the
contracts and may travel within the ASEAN to perfect such contracts. Supply chains
of globally competitive goods will be necessarily established through complex
negotiations between the component suppliers who are incidentally nationals from
at least two nations, or even all of the member-states of the Asian economic bloc.
Again, the details of the agreement would fall into the lap of lawyers who will
ultimately be part of the negotiating team or at least in the actual writing of the
contracts. It is clear that lawyers will be there not only when the contracts are
negotiated, entered into, perfected or consummated, but also and most importantly
when they are breached whereby settlements or court litigations would naturally
ensue. The ASEAN integration will not only increase the trade and commerce in the
region but it will also transform every aspect of life in a world where national
borders are virtually eliminated. Inescapably, the way we implement our laws in
light of our international commitments will likewise change.

PROBABLE

IMPACTS

The country long known as the sick man of Asia, for being an economic laggard
compared to our neighbours is now adjudged as a diamond in the region. We
cannot afford to lose this golden opportunity to develop only to be left out again by
our neighbours who were far behind us economically in the 1960s. We are now in
the so called Pacific Century where the driving force of global economy shifts from
the US and Europe towards Asia. Incidentally, the country sits between the two most
important global trade routes, the Asian trade route and the Pacific trade route;
hence, we are strategically positioned to take an important role to define the world
economy on our own terms. In line with this geopolitical consideration, it is easy to
understand the much touted pivot of the US war machine towards the Pacific. Surely
it is a clear recognition by the US of the growing importance of Asia as the prime
mover of global economy. With all these development going on, the question that
needs to be asked then is: are we ready to lead in an Asian-led global economy?
Our commercial laws may need to be re-examined in order to be more attuned to
the increasing impact of a shrinking global community where free trade will be the
norm. Taxation laws may need to evolve in order to find new ways of raising
revenue in zero-tariff scenarios. Professionals within the region will be free to ply
their trade in the country in same manner that our countrymen will also be free to
exercise their profession elsewhere in the region. Our labour laws, consequently
may be rocked to its core as a foreign element will be injected into the picture. In
order to take full advantage of all the excitement and the conflicts that the
integration would inevitably bring, our legal practitioners must be prepared to
embrace this forthcoming change. We could not allow lawyers from the other ASEAN
nations to take over by default because we do not have the required expertise.
We need to be familiarized and conversant with the commercial, economic and legal
practices of our neighbours so that we are in a better position to offer services that
could cater to the needs of our multinational clients. We need to position ourselves
strategically, both individually and collectively as legal practitioners, lest we may be
relegated into insignificance for being an anachronism in a fast changing world.
While our laws prohibit law practice in the Philippines to foreigners, we could not
prohibit lawyers of other countries to come to represent their clients in out of court
negotiations. They would not need to able to appear before our courts to gain
economically or otherwise on the unprecedented rise of public and private
international law issues that may ensue. In fact, what they would only need is to
scout for clients here and do the legal stuff in their own countries. They could have
a breakfast meeting with a client in the country and another meeting in another
country by dinner time. Furthermore, they dont even have to come to the country
to meet their clients. With the use of modern telephony and the internet,
transactions may be done at the tip of a finger and within seconds. While we may
successfully reserve law practice solely to Filipinos in the long term, we would not
be able to restrict foreign lawyers coming in to do their thing within the cracks of
our legal system. This means that we will be losing a lot of ministerial but
economically rewarding cases and retainer agreements to aliens while we will be

left with those difficult and highly contentious ones to the detriment of the
Integrated Bar.

PREPARATIONS

AND VISIONS

I believe we are ill prepared at this time to meet the scenarios discussed above.
Consequently, we need to brace ourselves not just to remain relevant but more
importantly to be a strong driving force of Philippine economic and political
leadership within the ASEAN and the rest of the globe. We must seize the initiative
at the earliest opportunity to cash in on the developments wherever they may
emerge since the window will not always be there to wait upon us. The sooner we
make the necessary preparations the better our strategic positions would be.
Incidentally, the Philippines has been tagged as the cheap English teacher owing to
the fact that our universities offer west-style English education which is a much
cheaper alternative to that of the US or England. We could pick upon this advantage
by establishing centres such as the Angara Centre for Law and Economics which is
the first and only Philippine policy and academic think-tank featuring international
law and economics experts. I believe we could afford to have the second one of
such a think-tank under the auspices of the University of the Visayas. The UV
Leadership Institute is an evidence that the university leadership and management
could be up to the challenges of the future. Such a centre could prepare our legal
practitioners and students to the challenges that the ASEAN integration and the
shrinking global community would inevitably bring. This is where our legal experts
could carve out a new niche on this emerging field of law and economics that would
be a vehicle for them to make a big name not only locally but also internationally.
The creation of such a centre, I propose, is an absolute necessity for two reasons:
first, in order for us to produce globally competitive lawyers and economists that
will be an integral part of the driving force of the economy that will propel the
country into the Pacific Century; and second, to remodel our legal paradigm in
order for it to be in sync to globalization otherwise we will be swept away into
insignificance. The benefits for us to make the necessary preparations are great and
so are our loss should we fail to do so. It is not too much then to dream for the
establishment of a Centre for International Law and Economics with the Gullas Law
School as a cornerstone. With the creation of such a centre it would not be
farfetched to be able to produce legal luminaries in this emerging field of law and
economics with such a compelling reputation suitable to be invited by the Supreme
Court as amicus curiae to argue in a future novel controversy of international
significance. Until then, our lawyers must strive on their own to equally adapt to a
fast changing playing field while at the same time remain steadfast to the
immutable principles of law and equity which can never be swept away by any
development whatsoever.