National Economy and Patrimony Flashcards
(49 cards)
What are the goals of the state with regards to National Economy and Patrimony?
Goals
- More equitable distribution of opportunities, income and wealth
- Sustained increase in amount of goods and services produced by the nation for the benefit of the people
- Expanding production as the key to raising the quality of life for all, especially the underprivileged.
What is the Regalian Doctrine?
Embodied in the Constitution through:
Sec. 2, Art. XII. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned by the State. With the exception of agricultural lands, all other natural resources shall not be alienated.
The classification of public lands are an exclusive prerogative by what department?
The classification of public lands is an exclusive prerogative of the Executive Department through the Office of the President
[Republic v. Register of Deeds of Quezon, G.R. No. 73974 (1995)]
What is the Doctrine of Native Title?
Ownership over native land is already vested on natives even if they do not have formal titles
[Cariño v. Insular Government, 212 U.S. 449 (1909)]
What endeavors are limited for filipino citizens or 100% Filipino corporations?
- Use and
enjoyment of marine wealth, exclusive to Filipino citizens [Art. XII, Sec. 2, par. 2]
2. Rules on agricultural lands (Art. XII, Sec. 3) (1) Citizens may lease only < 500 ha. (2) Citizens may acquire by purchase, homestead or grant only < 12 ha.
- Practice of
professions, save in cases
provided by law [Art. XII, Sec. 14(2)] - Small-scale utilization of natural resources, as may be provided by law [Art. XII, Sec. 2(3)]
What endeavors are limited for filipino citizens, or 60-40 Filipino Corporations?
- Co-production, Joint venture, and Production sharing agreements over natural resources [Art. XII, Sec. 2(1)] Agreements shall not exceed a period of 25 years renewable for another 25 years
- Educational Institutions [Art. XIV, Sec. 4(2)] Congress may increase Filipino equity participation.
- Areas of Investment as Congress may prescribe (Congress may prescribe
a higher percentage) [Art. XII, Sec. 10] - Operation of public utilities [Art. XII, Sec. 11] o Cannot be for longer period than 50 years o Executive and managing officers must be Filipino
What endeavors are limited to filipino citizens, or 70-30 Filipino corporations?
Engagement in advertising Industry [Art. XVI, Sec. 11]
Can private corporations or associations hold alienable land of public domain?
NO.
The Constitution holds that private corporations or associations may not hold alienable lands of the public domain except by lease, for a period not exceeding 25 years, renewable for not more than 25 years, and not to exceed 1000 ha. in area, [Art. XII, Sec. 3] but the Const. does not specify the capital requirements for such corporations.
What are the requirements or rules for a private corporation or association to hold alienable lands of public domain?
Sec 3, Art XII, Constitution
“Private corporations or associations may not hold such alienable lands of the public domain except by lease, for a period not exceeding twenty-five years, renewable for not more than twenty-five years, and not to exceed one thousand hectares in area.”
[iden]
A business or service engaged in regularly supplying the public with some commodity or service of public consequence.
A public utility
[JG Summit Holdings v. CA, G.R. No. 124293 (2000)].
What capital is covered by the Constitution limitation of 60% filipino owned corporations?
What “capital” is covered – The 60% requirement applies to both the voting control and the beneficial ownership of the public utility. Therefore, it shall apply uniformly, separately, and across the board to all classes of shares, regardless of nomenclature or category, comprising the capital of the corporation (e.g. 60% of common stock, 60% of preferred voting stock, and 60% of preferred non-voting stock)
[Gamboa v. Teves, G.R. No. 176579 (2012)].
Filipino First policy in the Constitution
Art. XII, Sec. 10. In the grant of rights, privileges, and concessions covering the national economy and patrimony, the State shall give preference to qualified Filipinos. The State shall regulate and exercise authority over foreign investments within its national jurisdiction and in accordance with its national goals and priorities.
What does the term “patrimony” mean in Sec 10, Art XII of the Constitution?
The term “patrimony” pertains to heritage, and given the history of the Manila Hotel, it has become a part of our national economy and patrimony. Thus, the Filipino First policy provision of the Constitution is applicable. Such provision is per se enforceable, and requires no further guidelines or implementing rules or laws for its operation [Manila Prince Hotel v. GSIS, G.R. No. 122156 (1997)].
Does the Constitution impose a policy of Filipino monopoly of the economic environment?
NO.
The Constitution does not impose a policy of Filipino monopoly of the economic environment. It does not rule out the entry of foreign investments, goods, and services. While it does not encourage their unlimited entry into the country, it does not prohibit them either. In fact, it allows an exchange on the basis of equality and reciprocity, frowning only on foreign competition that is unfair. The key, as in all economies in the world, is to strike a balance between protecting local businesses and allowing the entry of foreign investments and services
[Tañada v. Angara, G.R. No. 118295 (1997)].
[FIB]
Art XII, Sec 12
The State shall promote the preferential use of _____________, _____________ and ____________, and adopt measures that help make them competitive.
Filipino labor;
domestic materials;
locally produced goods
Art. XII, Sec. 12. The State shall promote the preferential use of Filipino labor, domestic materials and locally produced goods, and adopt measures that help make them competitive.
[FIB]
Par. 4, Sec. 2Art. XII.
The President may enter into ________ with foreign-owned corporations involving either _________________ for large-scale exploration, development, and utilization of ________________ according to the general terms and conditions provided by law, based on _____________ of the country. In such agreements, the State shall promote the development and use of _____________.
agreements;
technical or financial assistance;
minerals, petroleum, and other mineral oils;
real contributions to the economic growth and general welfare;
local scientific and technical resources
Par. 4, Sec. 2Art. XII.
The President may enter into ________ with foreign-owned corporations involving either _________________ for large-scale exploration, development, and utilization of ________________ according to the general terms and conditions provided by law, based on _____________ of the country. In such agreements, the State shall promote the development and use of _____________.
What are the 4 modes with which the State may undertake the exploration, development, and utilization of natural resources?
- The State may directly undertake such activities;
- The State may enter into co-production, joint venture or production-sharing agreements with Filipino citizens or qualified corporations;
- Congress may, by law, allow small-scale utilization of natural resources by Filipino citizens; or
- For the large-scale exploration, development and utilization of minerals, petroleum and other mineral oils, the President may enter into agreements with foreign-owned corporations involving technical or financial assistance
[La BugalB’Laan v. Ramos, G.R. No. 127882 (Jan. 2004)].
What are the requirements of an FTAA (financial and technical assistance agreement) in the 1987 Constitution?
- Parties: Only the President (in behalf of the State), and only with corporations
- Size of Activities: Only large-scale exploration, development and utilization
- Natural Resources Covered: Minerals, petroleum and other mineral oils
- Scope of Agreements: Involving either
financial or technical assistance
Differentiate an FTAA (financial and technical assistance) in the 1987 Constitution and Service Contract in the 1973 Constitution re parties?
FTAA:
Only the President (in behalf of the State), and only with corporations
Service Contract:
A Filipino citizen, corporation or association with a “foreign person or entity”
Differentiate an FTAA (financial and technical assistance) in the 1987 Constitution and Service Contract in the 1973 Constitution re size of parties?
FTAA:
Only exploration, development utilization large-scale
Service Contract:
Contractor provides all necessary services and technology and the requisite financing, performs the exploration work obligations, and assumes all exploration risks
Differentiate an FTAA (financial and technical assistance) in the 1987 Constitution and Service Contract in the 1973 Constitution re natural resources covered?
FTAA:
Minerals, petroleum and other mineral oils
Service Contracts:
Virtually the entire range of the country’s natural resources
Differentiate an FTAA (financial and technical assistance) in the 1987 Constitution and Service Contract in the 1973 Constitution re scope of agreements?
FTAA:
Involving either financial or technical assistance
Service Contracts:
Contractor provides financial or technical resources, undertakes the exploitation or production of a given resource,or directly manages the productive enterprise, operations of the exploration and exploitation of the resources or the disposition of marketing or resources
Are service contracts prohibited?
NO.
A verbalegis interpretation does not support an intended prohibition. The members of the CONCOM used the terms “service contracts” and “financial and technical assistance” interchangeably
[La Bugal-B’laan Tribal Assn. v. Ramos, G.R. No. 127882 (Dec. 2004)].
The following are valid:
- Financial and Technical Assistance Agreements (FTAA): not a prohibited agreement in the contemplation of the Constitution
- Philippine Mining Law (RA 7942)
- Its Implementing Rules and Regulations, insofar as they relate to financial and technical agreements [La Bugal-B’laan Tribal Assn. v. Ramos, supra (Dec. 2004)]
What are the limitations in the large scale exploration, development and utilization of minerals, petroleum and other mineral oils?
a) As to Parties. Only the President, in behalf of the State, may enter into these agreements, and only with corporations.
b) As to Size of the Activities. Only large scale exploration, development and utilization is allowed, i.e., very capital-intensive activities.
c) The natural resources subject of the activities is restricted to minerals, petroleum and other mineral oils, the intent being to limit service contracts to those areas where Filipino capital may not be sufficient.
d) Consistency with the Provisions of Statute. The FTAA must be in accordance with the terms and conditions provided by law.
e) The FTAA must be based on real contributions to economic growth and general welfare of the country.
f) The FTAA must contain rudimentary stipulations for the promotions of the development and use of local scientific and technical resources.
g) Notification Requirement. The President shall notify Congress of every FTAA entered into within 30 days from its execution.
h) Scope of the FTAA. Only for agreements involving either financial or technical assistance and does not include “service contracts” and “management or other forms of assistance.”
(La Bugal-B’laan Tribal Association, Inc., GR No. 127882, January 27, 2004)
