G.R. No.

124360 November 5, 1997

FRANCISCO S. TATAD, petitioner,
vs.
THE SECRETARY OF THE DEPARTMENT OF ENERGY AND THE
SECRETARY OF THE DEPARTMENT OF FINANCE, respondents.

Equal Protection - Oil Deregulation Law

Prior to 1971
NO GOVERNMENT AGENCY REGULATING THE OIL INDUSTRY.

Refining Companies Shell, Caltex, Bataan Refining

Company and Filoil Refining
Petroleum Marketing Companies Esso, Filoil, Caltex,
Getty, Mobil and Shell

1971. CRIPPLING OIL CRISIS

Oil Industry Commission Act. - power to fix the market prices of
petroleum products, to regulate the capacities of refineries, to
license new refineries and to regulate the operations and trade
practices
Importing, Exporting, Re-Exporting, Shipping, Transporting,
Processing, Refining, Storing, Distributing, Marketing And
Selling Crude Oil, Gasoline, Kerosene, Gas And Other Refined
Petroleum Products
Until early 70's
Crude oil transported to the country by foreign-controlled
tankers.
Crude processing done locally by foreign-owned refineries
and
Petroleum products were marketed through foreign-owned
retail outlets.
November 9, 1973,
Philippine National Oil Corporation (PNOC)
PETRON CORPORATION
Engaged in the business of refining, marketing, shipping,
transporting, and storing petroleum

1984
PD No. 1956 Oil Price Stabilization Fund (OPSF)
Cushion the effects of frequent changes in the price of oil
caused by
Exchange rate adjustments or increase in the world market
prices of CRUDE OIL AND IMPORTED PETROLEUM PRODUCTS.
FUND IS USED
To reimburse the oil companies for cost increases
(EXCHANGE RATE ADJUSTMENT/INCREASE IN WORLD MARKET
PRICES)
To reimburse oil companies for cost underrecovery
(REDUCTION OF DOMESTIC PRICES OF PETROLEUM
PRODUCTS)
By 1985
CALTEX, SHELL AND THE GOVERNMENT-OWNED PNOC
May, 1987
EXECUTIVE ORDER NO. 172 ENERGY REGULATORY BOARD
When warranted and only when public necessity
requires.
December 9, 1992
R.A. NO. 7638 DEPARTMENT OF ENERGY
March 1996
R.A. No. 8180 Downstream Oil Industry Deregulation Act of
1996.

ISSUES
Procedural Issues
Whether or not the petitions raise a justiciable controversy
Whether or not the petitioners have the standing to assail
the validity of the subject law and executive order
Substantive Issues
Whether or not section 5 Violates the one title one
subject requirement of the Constitution
Whether or not the same section violates the equal
protection clause of the Constitution
Whether or not section 15 violates the constitutional
prohibition on undue delegation of power
Whether or not E.O. No. 392 is arbitrary and unreasonable
Whether or not R.A. No. 8180 violates the constitutional
prohibition against monopolies, combinations in restraint of
trade and unfair competition.
HELD
R.A. No. 8180 is declared unconstitutional and E.O. No. 372
void.