POWERS AND FUNCTIONF OF THE PRESIDENT, FOREIGN AFFAIRS

G.R. No. L-14279

COMMISSIONER OF CUSTOMS VS. EASTERN SEA TRADING
CONCEPCION, J.

Summarized by Mil Ramos

This case involves the Customs Commissioner disputing the CTA reversal of Commission’s earlier decision regarding the forfeiture and release on bonds
of shipments confiscated from respondent Eastern Sea Trading. The Court rules in favor of the Commission stating the validity of EO 328 pursuant to an
executive agreement entered into with Japan. The Court also stressed on the authority of the Central Bank and its laws in managing imports entering the
country.

IMPORTANT PEOPLE
Petitioners: Commissioner of Customs and Collector of Customs
Respondent: Eastern Sea Trading

FACTS
1. Respondent Eastern Sea Trading, the consignee of several shipments of onion and garlic, was at the Port of Manila from August 25 to September
7, 1954
 Carried shipment from Japan and Hong Kong
 Because none of the shipments had the certificate required by Central Bank Circulars Nos. 44 and 45 for the release thereof, the goods
were seized and subjected to forfeiture proceedings for alleged violations of section 1363(f) of the Revised Administrative Code
2. The Collector of Customs of Manila rendered a decision on September 4, 1956
 Declared said goods forfeited to the Government (but are released to the consignees in the meantime on surety bonds → Alto Surety &
Insurance Co., Inc.)
 Done in compliance with orders of CFI Manila, directing that the amounts of bonds to be paid, by said principal and surety, jointly and
severally, to the Bureau of Customs, within thirty (30) days from notice
3. Consignee appealed but decision was affirmed by the Commissioner of Customs on December 27, 1956
4. Subsequently, the consignee sought a review of the decision of said two (2) officers by the Court of Tax Appeals → reversed the decision of the
Commissioner of Customs and ordered that the aforementioned bonds be cancelled and withdrawn
5. This present petition is filed by the Commissioner of Customs for review of the decision of the Court of Tax Appeals.
6. Premises considered by CTA decision:
 Central Bank has no authority to regulate transactions not involving foreign exchange
 the shipments in question are in the nature of "no-dollar" imports therefore they do not involve foreign exchange
 insofar as a 1) Central Bank license and 2) a certificate authorizing the importation or release of the goods are required by Central Bank
Circulars Nos. 44 and 45, the latter are null and void
 the seizure and forfeiture of the goods imported from Japan cannot be justified under Executive Order No. 328 because:
 it seeks to implement an executive agreement extending the effectivity of our Trades and Financial Agreements with Japan →
believed to be of dubious validity (bec. It is an Exec. Agreement w/o Senate concurrence)
  there is no governmental agency authorized to issue the import license required by the aforementioned executive order

ISSUE with HOLDING

W/N Trades and Financial Agreements with Japan, an executive agreement, should be considered in reversing the CTA decision and consequently
ordering the release of the forfeited goods on the basis of surety bonds (vs. being released unconditionally/for free kasi daw null and void yung agreement
and yung provisions) – YES

Court:
1. Authority of the Central Bank to regulate no-dollar imports and the validity of the aforementioned Circulars Nos. 44, and 45 have already been
passed upon and repeatedly upheld by this Court
 broad powers of the Central Bank to maintain monetary stability and to preserve the international value of our currency
 under section 2 of Republic Act No. 265, in relation to section 14 of said Act — authorizing the bank to issue such rules and
regulations as it may consider necessary for the effective discharge of the responsibilities and the exercise of the
powers assigned to the Monetary Board and to the Central Bank —
 provisions connote the authority to regulate no-dollar imports, owing to the influence and effect that the same may and do
have upon the stability of our peso and its international value
2. Court of Tax Appeals entertained doubts on the legality of the executive agreement sought to be implemented by Executive Order No. 328
because Senate had not concurred in the making of said executive agreement
 Concurrence required by our fundamental law in the making of "treaties" (Art. VII, Sec. 10(7), 1935 Const.; Art XVIII, Sec. 4, 1987 Const.)
 Executive agreements are distinct from treaties; they may be validly entered into without such concurrence.
 Treaties are formal documents which require ratification with the approval of two thirds of the Senate; usually involve political
issues/changes of national policy and international arrangements of a permanent character
 Executive agreements become binding through executive action without the need of a vote by the Senate or by Congress;
embody adjustments of detail carrying out well-established national policies and traditions and those involving arrangements of a
more or less temporary nature
3. Executive Agreements in foreign affairs:
 Right of the Executive to enter into binding agreements without the necessity of subsequent Congressional approval has been confirmed
by long usage
 earliest days of our history → executive agreements covering such subjects as commercial and consular relations, most-favored-
nation rights, patent rights, trademark and copyright protection, postal and navigation arrangements and the settlement of claims;
validity of these has never been seriously questioned by our courts
 Agreements with respect to the registration of trade-marks have been concluded by the Executive with various countries under the Act of
Congress of March 3, 1881. Pres. McKinley has entered into 10 EA’spursuant to the McKinley Tariff Act of 1890, and 9 under the Dingley
Tariff Act 1897;
 larger number of agreements provide for most-favored-nation treatment in customs and related matters have been entered into
since the passage of the Tariff Act of 1922
 United States Supreme Court has expressly recognized the validity and constitutionality of executive agreements entered into without
Senate approval.
 Francis B. Sayre, in "The Constitutionality of Trade Agreement Acts":
 “Agreements concluded by the President which fall short of treaties are commonly referred to as executive agreements and are no
less common in our scheme of government than are the more formal instruments — treaties and conventions. They sometimes
take the form of exchanges of notes and at other times that of more formal documents denominated "agreements" time or
"protocols"…Hundreds of executive agreements, other than those entered into under the trade-agreements act, have been
negotiated with foreign governments. . . . It would seem to be sufficient, in order to show that the trade agreements under the act
of 1934 are not anomalous in character, that they are not treaties, and that they have abundant precedent in our history, to
refer to certain classes of agreements heretofore entered into by the Executive without the approval of the Senate. They cover
such subjects as the inspection of vessels, navigation dues, income tax on shipping profits, the admission of civil aircraft, customs
matters, and commercial relations generally, international claims, postal matters, the registration of trademarks and copyrights,
etcetera. Some of them were concluded…in conformity with policies declared in acts of Congress with respect to the general
subject matter, such as tariff acts; while still others, particularly those with respect of the settlement of claims against foreign
governments, were concluded independently of any legislation.”
4. CTA was wrong in saying that it would be unreasonable to require from respondent-appellee an import license when the Import Control
Commission was no longer in existence → therefore no agency authorized to issue the aforementioned license.
 Wrong because authority to issue the aforementioned licenses was not vested exclusively upon the Import Control Commission or
Administration. Executive Order No. 328 provided for export or import licenses "from the Central Bank of the Philippines or the Import
Control Administration" or Commission.
 Upon the abolition of said Commission, the duty had merely to be discharged directly by the Monetary Board and the Central Bank.

DISPOSITIVE PORTION
WHEREFORE, the decision appealed from is hereby reversed and another one shall be entered affirming that of the Commissioner of Customs,
with cost against respondents defendant-appellee, Eastern Sea Trading. It is so ordered.
Plaridel M. Abaya vs. Hon. Secretary Hermogenes E. Ebdane, Jr.G. R. No. 167919 February 14, 2007
G. R. No. 167919
February 14, 2007
Plaridel M. Abaya vs. Hon. Secretary Hermogenes E. Ebdane, Jr.

FACTS:

 The Government of Japan and the Government of the Philippines, through their respective representatives, namely, Mr. Yoshihisa Ara,
Ambassador Extraordinary and Plenipotentiary of Japan to the Republic of the Philippines, and then Secretary of Foreign Affairs Domingo
L. Siazon, have reached an understanding concerning Japanese loans to be extended to the Philippines. These loans were aimed at
promoting our country’s economic stabilization and development efforts.
 The assailed resolution recommended the award to private respondent China Road & Bridge Corporation of the contract for the
implementation of civil works for Contract Package No. I (CP I), which consists of the improvement/rehabilitation of the San Andres
(Codon)-Virac-Jct. Bago-Viga road, with the length of 79.818 kilometers, in the island province of Catanduanes.The DPWH caused the
publication of the “Invitation to Prequalify and to Bid” for the implementation of the CP I project, in two leading national newspapers,
namely, the Manila Times and Manila Standard on November 22 and 29, and December 5, 2002.
o A total of twenty-three (23) foreign and local contractors responded to the invitation by submitting their accomplished
prequalification documents on January 23, 2003. In accordance with the established prequalification criteria, eight contractors
were evaluated or considered eligible to bid as concurred by the JBIC. Prior to the opening of the respective bid proposals, it was
announced that the Approved Budget for the Contract (ABC) was in the amount of P738,710,563.67.
 The bid goes to private respondent China Road & Bridge Corporation was corrected from the original P993,183,904.98 (with variance of
34.45% from the ABC) to P952,564,821.71 (with variance of 28.95% from the ABC) based on their letter clarification dated April 21, 2004.
 The petitioners anchor the instant petition on the contention that the award of the contract to private respondent China Road & Bridge
Corporation violates RA 9184, particularly Section 31 thereof which reads:
o SEC. 31. Ceiling for Bid Prices. – The ABC shall be the upper limit or ceiling for the Bid prices. Bid prices that exceed this ceiling
shall be disqualified outright from further participating in the bidding. There shall be no lower limit to the amount of the award.
 The petitioners insist that Loan Agreement is neither an international nor an executive agreement that would bar the application of RA
9184. They point out that to be considered a treaty, an international or an executive agreement, the parties must be two sovereigns or
States whereas in the case of Loan Agreement No. PH-P204, the parties are the Philippine Government and the JBIC, a banking agency
of Japan, which has a separate juridical personality from the Japanese Government.
 The respondents however contend that foreign loan agreements, including Loan Agreement No. PH-P204, as executive agreements and,
as such, should be observed pursuant to the fundamental principle in international law of pacta sunt servanda. The Constitution, the public
respondents emphasize, recognizes the enforceability of executive agreements in the same way that it recognizes generally accepted
principles of international law as forming part of the law of the land.34This recognition allegedly buttresses the binding effect of executive
agreements to which the Philippine Government is a signatory. It is pointed out by the public respondents that executive agreements are
essentially contracts governing the rights and obligations of the parties. A contract, being the law between the parties, must be faithfully
adhered to by them. Guided by the fundamental rule of pacta sunt servanda, the Philippine Government bound itself to perform in good
faith its duties and obligations under Loan Agreement.
 ISSUE:
Whether or not the Loan Agreement No. PH-204 between the JBIC and the Philippine Government is a kind of a treaty.

HELD:
 The Loan Agreement No. PH-204 taken in conjunction with the Exchange of Notes dated December 27, 1999 between the Japanese
Government and the Philippine Government is an executive agreement.
o An “exchange of notes” is a record of a routine agreement that has many similarities with the private law contract. The agreement
consists of the exchange of two documents, each of the parties being in the possession of the one signed by the representative of
the other.
…treaties, agreements, conventions, charters, protocols, declarations, memoranda of understanding, modus vivendi and
exchange of notes all are refer to international instruments binding at international law.

 Although these instruments differ from each other by title, they all have common features and international law has applied basically the
same rules to all these instruments. These rules are the result of long practice among the States, which have accepted them as binding
norms in their mutual relations. Therefore, they are regarded as international customary law.
o That case was dismissed by the SCORP last Feb. 14 2007.
o What the petitioners wanted was that Foreign funded projects also undergo the procurement process.
 The dismissal of the case somehow gave justification for the delay of the implementing rules for foreign funded projects (IRR-B) of the
procurement law If we recall the decision of the Abaya vs Ebdane was used by the DOJ when the DOTC Secretary was asking for an
opinion from the former, during the ZTE controversy.as ruled by the Supreme Court in Abaya v. Ebdane, an exchange of notes is
considered a form of an executive agreement, which becomes binding through executive action without need of a vote by the
Senate and that (like treaties and conventions, it is an international instrument binding at international law,
 The second issue involves an examination of the coverage of Republic Act No. 9184, otherwise known as the “Government Procurement
Reform Act”. Section 4 of the said Act provides that it shall apply to: … the Procurement of infrastructure Projects, Goods and Consulting
Services, regardless of source of funds, whether local or foreign, by all branches and instrumentalities of government, its departments,
offices and agencies, including government-owned and/or -controlled corporations and local government units, subject to the provisions of
Commonwealth Act No. 138. Any treaty or international or executive agreement affecting the subject matter of this Act to which the
Philippine government is a signatory shall be observed.
 Bayan Muna v. Romulo

Ponente : Velasco Jr
February 1, 2011
Petitioner : Bayan Muna represented by Satur Ocampo, Crispin Beltran, and Liza Maza Defendant : Alberto Romulo as Exec. Secretary and
Ople as Sec. of. DFA
Petition for certiorari, mandamus and prohibition under Rule 65 assails and seeks to
nullify the Non-‐Surrender Agreement concluded by and between RP and USA.

Facts:

- Petitioner Bayan Muna is a duly registered party-‐list group established to represent the marginalized sectors of society.
Respondent Blas Ople (deceased), was the Sec. of Foreign Affairs during the period material to the case. Respondent Alberto
Romulo was impleaded in his capacity as Exec. Secretary.

- Rome Statute establishes the Int’l Criminal Court (ICC) w/ “the power to exercise its jurisdiction over persons for the most
serious crimes of international concern (ie. Genocide, war crimes, etc.) xxx and shall be complementary to the national
criminal jurisdictions.”

- Dec. 28, 2000—RP, through Enrique Manolo (Charge d’Affaires) signed the Rome Statute. Yet, as of the filing of the
instant petition, PH is not among the signatory countries that appear to have completed the ratification, approval and
concurrence process.

- May 9 2003—US (through their Ambassador) sent US Embassy Note No. 0470 to DFA proposing the terms of the non-‐
surrender bilateral agreement (Agreement) bet. RP and USA; May 13, 2003 RP (represented by Ople) agreed and accepted
the proposals. The Agreement aims to protect what it refers to and defines as “persons” of the RP and US from
frivolous and harassment suits that might be brought against them in international tribunals.

Issue/ Held/ Ratio:

Procedural Issue: Locus Standi of Petitioner

Petitioner contends that the issue of the validity or invalidity of the Agreement carries with it constitutional significance and is of
paramount importance that justifies its standing. In emergency cases, ordinary citizens and taxpayers were accorded the personality
to question the constitutionality of executive issuances.

Court held that the petitioner’s representatives have complied with the qualifying conditions or specific requirements exacted under the
locus standi rule. As citizens, their interest in the subject matter of the petition is direct and personal

1. Whether or not the Agreement was contracted validly, which resolves itself into the question of whether or not
respondents gravely abused their discretion in concluding it. – YES

Validity of the RP-‐US Non‐Surrender Agreement

Petitioner’s initial challenge against the Agreement relates to form, its threshold posture being that E/N BFO-‐028-‐03 cannot
be a valid medium for concluding the Agreement.

Court held that Petitioners’ contention is untenable. An exchange of notes falls “into the category of inter-‐governmental
agreements,” which is an internationally accepted form of international agreement. In another perspective, exchange of notes is
being considered a form of executive agreement that becomes binding through executive action. It is fairly clear from the
foregoing disquisition that E/N BFO-‐028-‐03 is a recognized mode of concluding a legally binding international written
contract among nations.

2. Whether or not the Agreement, which has not been submitted to the Senate for concurrence, contravenes and
undermines the Rome Statute and other treaties. --NO

Senate Concurrence Not Required

International agreements may be in form of:

1. Treaties that require legislative concurrence after executive ratification

2. Executive agreements that are similar to treaties, except that they do not require legislative concurrence and are usually less
formal and deal with a narrower range of subject matters than treaties.

Petitioner parlays the notion that the Agreement is of dubious validity, partaking as it does of the nature of a treaty; hence, it
must be duly concurred by the Senate.

Petitioner submits that the subject of the Agreement may not be covered by an executive agreement, as it does not fall under
any of the subject-‐categories enumerated in the Eastern Sea Trading case.

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 Petitioner asserts that an executive agreement through an exchange of notes cannot be used to amend a treaty (relying on
the case of Adolfo v. CFI of Zambales and Merchant).

Court is not persuaded by the Petitioner’s arguments.

There are no hard and fast rules, on the propriety of entering, on a given subject, into a treaty or executive agreement as an instrument of
international relations. The primary consideration in the choice of the form of agreement is the parties’ intent and desire to craft an
international agreement in the form they wish to further their respective interests.
When a treaty is required, the Constitution does not classify any subject, like that involving political issues, to be in the form of, and
ratified as, a treaty. Petitioners’ reliance on Adolfo is misplaced. The Court need not belabour at length the issue referring to the validity
and effectivity of the Agreement without the concurrence by at least two‐thirds of all the members of the Senate since the Court has given
recognition to the obligatory effect of executive agreements without the concurrence of the Senate.

The Agreement Not in Contravention of the Rome Statute.

Petitioner: Agreement undermines the establishment of he ICC and is null and void as it unduly restricts the ICC’s jurisdiction and infringes
upon the effectivity of the Rome Statute.
Overall object and purpose of the Rome Statute is to ensure that those responsible for the worst possible crimes are brought to justice in all
cases, primarily by states, but as a last resort, by the ICC; thus, any agreement (i.e. non—surrender greement) that precludes the ICC from
exercising its complementary function of acting when state is unable to or unwilling to do so, defeats the object and purpose of he Rome
Statute.
Representatives of signatory of the Rome Statute are obliged by the imperatives of good faith to refrain from performing acts that
substantially devalue the purpose and object of the Statute, as signed.

Court: Agreement does not contravene or undermine, nor does it differ from, the Rome Statute.

1. Agreement is complementary with the Rome Statute (see Art. 1 of the Rome Statute).

2. Provisions of he Rome Statute (6th preambular paragraph, Art 17 par 1, Art 20 par 3) taken collectively, argue against the idea of
jurisdictional conflict between the PH, as party to the non- surrender agreement, and the ICC; or the idea of the Agreement substantially
impairing the value of the RP’s undertaking under the Rome Statute. He Rome Statute expressly recognizes the primary jurisdiction of
states, over serious crimes committed within their respective borders, the complementary jurisdiction of the ICC coming into play only when
he ignatory states are unwilling or unable to prosecute.

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3. The Court rejects the petitioner’s suggestion that by entering into the Agreement, RP violated its duty required by the imperatives of
good faith and breached its commitment under the Vienna Convention. Nothing in the provisions of the Agreement tends to diminish he
fficacy of the Roman tatute, let alone defeats the purpose of the ICC.

4. A careful reading of Art. 90 would show that the Agreement is not incompatible with the Rome Statute.

a. US is neither a State‐Party nor a signatory to the Rome Statute

b. There is an international agreement between the US and the PH regarding extradition or surrender of persons (Agreement).

Sovereignty Limited by International Agreements

Petitioner: RP (through Agreement) abdicated its sovereignty by waiving or abandoning its right to seek recourse through the Rome Statute
of the ICC for erring Americans committing international crimes in the country.
Court: Agreement is but a form of affirmance and conformance of the PH’s national criminal jurisdiction. In the context of the Constitution,
there can be no serious objection to the PH agreeing to undertake the things set forth in the Agreement.

One State can agree to waive jurisdiction to subjects of another State due to the recognition of the principle of extraterritorial
immunity. Almost every time a state enters into an international agreement, it voluntarily sheds off part of its sovereignty. Greater benefits
may be derived from a pact or a reciprocal undertaking of one contracting party to grant the same privileges or immunities to the other.
A portion of sovereignty may be waived without violating the Constitution.

Agreement Not Immoral Not at Variance

Petitioner: Agreement be struck down as void ab initio for imposing immoral obligations and/or being at variance with allegedly universally
recognized principles of international law. It leaves criminals immune from responsibility for unimaginable atrocities that deeply shock the
conscience of humanity.

Court: The agreement is recognition of the primacy andcompetence of the country’s judiciary to try offenses under its national criminal
laws and dispense justice fairly and judiciously. What the Agreement contextually prohibits is the surrender by either party of individuals to
international tribunals, like the ICC, without the consent of the other party, which may desire to prosecute the crime under its existing laws.
*Nothing immoral or violative of int’l law pursuant to the non- surrender agreement.

No Grave Abuse of Discretion

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Petitioner: Non-surrender agreement executed by the President, thru the DFA Sec, is ingrave abuse of discretion (necessity of the
Senate’s concurrence in the Agreement).
Court: The President, as head of state and government, is the sole organ and authority in the external affairs of the country. Executive
agreements may be validly entered into without Senate’s concurrence.

Agreement Need Not Be in the Form of a Treaty

Petitioner: Agreement cannot be embodied in a simple exec. Agreement in the form of an exchange of notes but must be implemented
through an extradition law or a treaty with the corresponding formalities.

In reference to Sec. 2 of Art II of the Constitution, the Statute embodies principles of law, which constitute customary international law or
custom. Any derogation from the Rome Statute principles cannot be undertaken via a mere executive agreement. Therefore,
INEFFICACIOUS unless it is embodied in a treaty duly ratified with concurrence of Senate (ratified treaty partakes of the nature of a
municipal law that can AMEND or SUPERSEDE another law)

Court:
1. Agreement does not amend or is not repugnant to RA 9851.
2. Petitioners do not clearly state what precise principles of law, if any, the Agreement alters. 3. No concrete demonstration how the
Agreement seeks to frustrate the objectives of the principles of law subsumed in the Rome Statute. Agreement merely reinforces the
primacy of the national jurisdiction of the US and the PH in prosecuting criminal offenses committed by their “persons”. Nowhere in RA 9851
is there a proviso that goes against the tenor of the Agreement.

Petitioner: Par. 2 Sec. 17 RA 9851 requires the Philippine State to surrender to the proper international tribunal those persons accused of
crimes sanctioned under said law if it does not exercise its primary jurisdiction to prosecute such persons.
Court: Above quoted proviso clearly provides discretion to the PH State on whether to surrender or not a person accused of the crimes
under RA 9851. The use of the word “may” denotes discretion, and cannot be construed as having mandatory effect.

Petitioner: RP--‐US Extradition Treaty is inapplicable to RA 9851: under par. 1 Art 2 of the RP--‐US Extradition Treaty, while the PH has
criminalized under RA 9851 the acts defined in the Rome Statute as war crimes, genocide, etc., there is no similar legislation in the US.
Citing US v. Coolidge, a person cannot be tried in the federal courts for an int’l crime unless Congress adopts a law defining and punishing
the offense.

Court: US has already enacted legislation punishing the high crimes mentioned. In Dec 2009, US adopted a law that criminalized
genocide.

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Petitioner: Current US laws do not cover every crime listed within the jurisdiction of the ICC and that there is a gap between the definitions
of the diff crimes under the US laws v. the Rome Statute. This view used a report by Holt and Dallas. Court: The report used may not have
any weight or value under the international law because it does not fall under the enumerated sources of international law.

Assuming the report has weight, the perceived gaps in the definitions of the crimes are non-- existent. Please check table starting p. 286.
Despite the lack of actual domestic legislation, US notably follows the doctrine of incorporation. Thus, a person can be tried in the US for an
int’l crime despite the lack of domestic legislation. The term ‘jus cogens’ means the ‘compelling law.’ When applied to int’l crimes, jus cogens
crimes have been deemed so fundamental to the existence of a just int’l legal order that states cannot derogate from them, even by
agreement. Theses jus cogens crimes relate to the principle of universal jurisdiction. Therefore, even with the current lack of domestic
legislation on the part of the US, it still has both the doctrine of incorporation and universal jurisdiction to try these crimes. An act
of the executive branch with a foreign government must be afforded great respect. Ratio: Inviolable doctrine of separation of powers among
the legislative, executive and judicial branches of the government. Thus, absent any clear contravention of the law, courts should exercise
utmost caution in declaring any executive agreement invalid.

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