62 Heirs of Wilson P. Gamboa vs. Teves et al G.R. No.

176579 October 9,
2012.

Nature of the case: A resolved motions for reconsideration of the 28 June

2011 Decision filed by the Philippine Stock Exchange's (PSE) President
Manuel V. Pangilinan, Napoleon L. Nazareno and Securities and Exchange
Commission (SEC) (collectively movants)
Facts: The issue started when petitioner Gamboa questioned the indirect sale
of shares involving almost 12 million shares of the Philippine Long Distance
Telephone Company (PLDT) owned by PTIC to First Pacific. Thus, First Pacific's
common shareholdings in PLDT increased from 30.7 percent to 37 percent,
thereby increasing the the total common shareholdings of foreigners in PLDT
to about 81.47%. The petitioner contends that it violates the Constitutional
provision on filipinazation of public utility, stated in Section 11, Article XII of
the 1987 Philippine Constitution, which limits foreign ownership of the capital
of a public utility to not more than 40%. Then, in 2011, the court ruled the
case in favor of the petitioner,hence this new case, resolving the motion for
reconsideration for the 2011 decision filed by the respondents.

Issue: Whether or not the Court made an erroneous interpretation of the

term "capital" in its 2011 decision.

Ruling: The Court said that the Constitution is clear in expressing its State
policy of developing an economy effectively controlled by Filipinos. Asserting
the ideals that our Constitution's Preamble want to achieve, that is-to
conserve and develop our patrimony,hence the State should fortify a Filipino-
controlled economy in the 2011 decision, the Court finds no wrong in the
construction of the term "capital" which refers to the shares with voting
rights, as well with full beneficial ownership (Art. 12, sec. 10) which implies
that the right to vote in the election of directors,coupled with benefits, is
tantamount to an effective control. Therefore,the Court's interpretation of the
term 'capital' was not erroneous. Thus, the motion for reconsideration is
denied.