G.R. No. L-7995 – 101 Phil.

1155 – Political Law – Constitutional Law – Treaties May Be Superseded by

Municipal Laws in the Exercise of Police Power

Lao Ichong is a Chinese businessman who entered the country to take advantage of business
opportunities herein abound (then) – particularly in the retail business. For some time he and his fellow
Chinese businessmen enjoyed a “monopoly” in the local market in Pasay. Until in June 1954 when
Congress passed the RA 1180 or the Retail Trade Nationalization Act the purpose of which is to reserve
to Filipinos the right to engage in the retail business. Ichong then petitioned for the nullification of the
said Act on the ground that it contravened several treaties concluded by the RP which, according to him,
violates the equal protection clause (pacta sund servanda). He said that as a Chinese businessman
engaged in the business here in the country who helps in the income generation of the country he
should be given equal opportunity.

ISSUE: Whether or not a law may invalidate or supersede treaties or generally accepted principles.

HELD: Yes, a law may supersede a treaty or a generally accepted principle. In this case, there is no
conflict at all between the raised generally accepted principle and with RA 1180. The equal protection of
the law clause “”does not demand absolute equality amongst residents; it merely requires that all
persons shall be treated alike, under like circumstances and conditions both as to privileges conferred
and liabilities enforced””; and, that the equal protection clause “”is not infringed by legislation which
applies only to those persons falling within a specified class, if it applies alike to all persons within such
class, and reasonable grounds exist for making a distinction between those who fall within such class
and those who do not.””

For the sake of argument, even if it would be assumed that a treaty would be in conflict with a statute
then the statute must be upheld because it represented an exercise of the police power which, being
inherent could not be bargained away or surrendered through the medium of a treaty. Hence, Ichong
can no longer assert his right to operate his market stalls in the Pasay city market.