EN BANC

motorcycles along the entire breadth of North and South Luzon Expressways and
the Manila-Cavite (Coastal Road) Toll Expressway under DO 215.

[G.R. NO. 158793 : June 8, 2006]

4. On June 28, 2001, the trial court, thru then Presiding Judge Teofilo Guadiz, after
JAMES MIRASOL, RICHARD SANTIAGO, and LUZON MOTORCYCLISTS due hearing, issued an order granting petitioners' application for preliminary
FEDERATION, INC.,Petitioners,  v.  DEPARTMENT OF PUBLIC WORKS AND injunction. On July 16, 2001, a writ of preliminary injunction was issued by the trial
HIGHWAYS and TOLL REGULATORY BOARD, Respondents.
court, conditioned upon petitioners' filing of cash bond in the amount
of P100,000.00, which petitioners subsequently complied with.

D E C I S I O N

CARPIO, J.:
5. On July 18, 2001, the DPWH acting thru the TRB, issued Department Order No.
123 allowing motorcycles with engine displacement of 400 cubic centimeters inside
This Petition for Review on  Certiorari  1  seeks to reverse the Decision dated 10 limited access facilities (toll ways).

March 2003 of the Regional Trial Court, Branch 147, Makati City (RTC) in Civil Case
No. 01-034, as well as the RTC's Order dated 16 June 2003 which denied
petitioners' Motion for Reconsideration. Petitioners assert that Department of
Public Works and Highways' (DPWH) Department Order No. 74 (DO 74),
Department Order No. 215 (DO 215), and the Revised Rules and Regulations on
6. Upon the assumption of Honorable Presiding Judge Ma. Cristina Cornejo, both
the petitioners and respondents were required to file their respective Memoranda.
Petitioners likewise filed [their] Supplemental Memorandum. Thereafter, the case
was deemed submitted for decision.

Limited Access Facilities of the Toll Regulatory Board (TRB) violate Republic Act
No. 2000 (RA 2000) or the Limited Access Highway Act. Petitioners also seek to 7. Consequently, on March 10, 2003, the trial court issued the assailed decision
declare Department Order No. 123 (DO 123) and Administrative Order No. 1 (AO dismissing the petition but declaring invalid DO 123. Petitioners moved for a
1)2 unconstitutional.
reconsideration of the dismissal of their petition; but it was denied by the trial court
in its Order dated June 16, 2003.3

Antecedent Facts
Hence, this petition.

The facts are not in dispute. As summarized by the Solicitor General, the facts are The RTC's Ruling

as follows:

The dispositive portion of the RTC's Decision dated 10 March 2003 reads:

1. On January 10, 2001, petitioners filed before the trial court a Petition for
Declaratory Judgment with Application for Temporary Restraining Order and WHEREFORE, [t]he Petition is denied/dismissed insofar as petitioners seek to
Injunction docketed as Civil Case No. 01-034. The petition sought the declaration declare null and void ab initio DPWH Department Order No. 74, Series of 1993,
of nullity of the following administrative issuances for being inconsistent with the Administrative Order No. 1, and Art. II, Sec. 3(a) of the Revised Rules on Limited
provisions of Republic Act 2000, entitled "Limited Access Highway Act" enacted in Access Facilities promulgated by the DPWH thru the TRB, the presumed validity
1957:
thereof not having been overcome; but the petition is granted insofar as DPWH
Department Order No. 123 is concerned, declaring the same to be invalid for being
A. DPWH Administrative Order No. 1, Series of 1968;
violative of the equal protection clause of the Constitution.

b. DPWH Department Order No. 74, Series of 1993;

c. Art. II, Sec. 3(a) of the Revised Rules on Limited Access Facilities promulgated in SO ORDERED.4

199[8] by the DPWH thru the Toll Regulatory Board (TRB).

The Issues

2. Previously, pursuant to its mandate under R.A. 2000, DPWH issued on June 25,
1998 Department Order (DO) No. 215 declaring the Manila-Cavite (Coastal Road) Petitioners seek a reversal and raise the following issues for resolution:

Toll Expressway as limited access facilities.

1. WHETHER THE RTC'S DECISION IS ALREADY BARRED BY RES JUDICATA;

3. Accordingly, petitioners filed an Amended Petition on February 8, 2001 wherein 2. WHETHER DO 74, DO 215 AND THE TRB REGULATIONS CONTRAVENE RA
petitioners sought the declaration of nullity of the aforesaid administrative 2000; AND

issuances. Moreover, petitioners prayed for the issuance of a temporary restraining 3. WHETHER AO 1 AND DO 123 ARE UNCONSTITUTIONAL.5

order and/or preliminary injunction to prevent the enforcement of the total ban on
The Ruling of the Court

The petition is partly meritorious.
Whether the RTC's Decision Dismissing Petitioners' Case is Barred by Res Judicata
Petitioners rely on the RTC's Order dated 28 June 2001, which granted their prayer
for a writ of preliminary injunction. Since respondents did not appeal from that
Order, petitioners argue that the Order became "a final judgment" on the issues.
Petitioners conclude that the RTC erred when it subsequently dismissed their
petition in its Decision dated 10 March 2003.
Petitioners are mistaken. As the RTC correctly stated, the Order dated 28 June
2001 was not an adjudication on the merits of the case that would
trigger res judicata. A preliminary injunction does not serve as a final determination
of the issues. It is a provisional remedy, which merely serves to preserve the status
quo until the court could hear the merits of the case.6 Thus, Section 9 of Rule 58 of
the 1997 Rules of Civil Procedure requires the issuance of a final injunction to
confirm the preliminary injunction should the court during trial determine that the
acts complained of deserve to be permanently enjoined. A preliminary injunction is
a mere adjunct, an ancillary remedy which exists only as an incident of the main
proceeding.7
and the South Luzon Expressway from Nichols to Alabang as Limited Access
Validity of DO 74, DO 215 and the TRB Regulations
Petitioners claim that DO 74,8  DO 215,9  and the TRB's Rules and Regulations
issued under them violate the provisions of RA 2000. They contend that the two
issuances unduly expanded the power of the DPWH in Section 4 of RA 2000 to
regulate toll ways. Petitioners assert that the DPWH's regulatory authority is limited
to acts like redesigning curbings or central dividing sections. They claim that the
DPWH is only allowed to re-design the physical structure of toll ways, and not to
determine "who or what can be qualified as toll way users."10
ways open to use by all customary forms of street and highway traffic."
Section 4 of RA 200011 reads:
Section 3 of the same Act authorizes the Department of Public Works and
SEC. 4. Design of limited access facility. - The Department of Public Works and
Communications is authorized to so design any limited access facility and to
so regulate, restrict, or prohibit access as to best serve the traffic for which
such facility is intended; and its determination of such design shall be final. In this
connection, it is authorized to divide and separate any limited access facility into
separate roadways by the construction of raised curbings, central dividing sections,
or other physical separations, or by designating such separate roadways by signs,
markers, stripes, and the proper lane for such traffic by appropriate signs, markers,
stripes and other devices. No person, shall have any right of ingress or egress to,
from or across limited access facilities to or from abutting lands, except at such
designated points at which access may be permitted, upon such terms and
conditions as may be specified from time to time.
In view thereof, the National Capital Region (NCR) of this Department is hereby
On 19 February 1968, Secretary Antonio V. Raquiza of the  Department of Public
Works and Communications  issued AO 1, which, among others, prohibited
motorcycles on limited access highways. The pertinent provisions of AO 1 read:
enforcement and security group for the purpose of assuring the continued closure
SUBJECT: Revised Rules and Regulations Governing Limited Access Highways
By virtue of the authority granted the Secretary [of] Public Works and
Communications under Section 3 of R.A. 2000, otherwise known as the Limited
Access Highway Act, the following rules and regulations governing limited access
highways are hereby promulgated for the guidance of all concerned:
x x x x
Section 3 - On limited access highways, it is unlawful for any person or group
of persons to:
x x x x
(h) Drive any bicycle, tricycle, pedicab, motorcycle or any vehicle (not motorized);
On 5 April 1993, Acting Secretary Edmundo V. Mir of the  Department of Public
Works and Highwaysissued DO 74:
SUBJECT: Declaration of the North Luzon Expressway from Balintawak to Tabang
Facilities
Pursuant to Section 2 of Republic Act No. 2000, a limited access facility is defined
as "a highway or street especially designed for through traffic, and over, from, or to
which owners or occupants of abutting land or other persons have no right or
easement or only a limited right or easement of access, light, air or view by reason
of the fact that their proper[t]y abuts upon such limited access facility or for any
other reason. Such highways or streets may be parkways, from which trucks,
buses, and other commerical [sic] vehicles shall be excluded; or they may be free
Communications (now Department of Public Works and Highways) "to plan,
designate, establish, regulate, vacate, alter, improve, maintain, and provide limited
access facilities for public use wherever it is of the opinion that traffic conditions,
present or future, will justify such special facilities."
Therefore, by virtue of the authority granted above, the Department of Public Works
and Highways hereby designates and declares the Balintawak to Tabang Sections
of the North Luzon Expressway, and the Nichols to Alabang Sections of the South
Luzon Expressways, to be LIMITED ACCESS HIGHWAYS/FACILITIES subject to
such rules and regulations that may be imposed by the DPWH thru the Toll
Regulatory Board (TRB).
ordered, after consultation with the TRB and in coordination with the Philippine
National Police (PNP), to close all illegal openings along the said Limited Access
Highways/Facilities. In this connection, the NCR is instructed to organize its own
of the right-of-way fences and the implementation of the rules and regulations that Limited Access Facilities, which ban motorcycles' entry or access to the limited
may be imposed by the DPWH thru the TRB.
access facilities, are not inconsistent with RA 2000.

This Order shall take effect immediately.13

RA 2000, otherwise known as the Limited Access Highway Act, was approved on
22 June 1957. Section 4 of RA 2000 provides that "[t]he  Department of Public
On 25 June 1998, then DPWH Secretary Gregorio R. Vigilar issued DO 215:
Works and Communications is authorized to so design any limited access facility
and to so regulate, restrict, or prohibit access as to best serve the traffic for which
SUBJECT: Declaration of the R-1 Expressway, from Seaside drive to Zapote, C-5 such facility is intended." The RTC construed this authorization to regulate, restrict,
Link Expressway, from Zapote to Noveleta, of the Manila Cavite Toll Expressway as or prohibit access to limited access facilities to apply to the Department of Public
Limited Access Facility.
Works and Highways (DPWH).

Pursuant to Section 2 of Republic Act No. 2000, a limited access facility is defined
as "a highway or street especially designed for through traffic, and over, from, or to
which owners or occupants of abutting land or other persons have no right or
easement or only a limited right or easement of access, light, air or view by reason
of the fact that their property abuts upon such limited access facility or for any
other reason. Such highways or streets may be parkways, from which trucks,
The RTC's ruling is based on a wrong premise. The RTC assumed that the DPWH
derived its authority from its predecessor, the Department of Public Works and
Communications, which is expressly authorized to regulate, restrict, or prohibit
access to limited access facilities under Section 4 of RA 2000. However, such
assumption fails to consider the evolution of the Department of Public Works and
Communications.

buses, and other commercial vehicles shall be excluded; or they may be free ways
open to use by all customary forms of street and highway traffic."
Under Act No. 2711, otherwise known as the Revised Administrative Code,
approved on 10 March 1917, there were only seven executive departments,
Section 3 of the same Act authorizes the Department of Public Works and namely: the Department of the Interior, the Department of Finance, the Department
Communications (now Department of Public Works and Highways) "to plan, of Justice, the Department of Agriculture and Commerce, the  Department of
designate, establish, regulate, vacate, alter, improve, maintain, and provide limited Public Works and Communications, the Department of Public Instruction, and the
access facilities for public use wherever it is of the opinion that traffic conditions, Department of Labor.15 On 20 June 1964, Republic Act No. 413616 created the Land
present or future, will justify such special facilities."
Transportation Commission under the Department of Public Works and
Communications. Later, the Department of Public Works and Communications was
Therefore, by virtue of the authority granted above, the Department of Public Works restructured into the  Department of Public Works, Transportation and
and Highways hereby designates and declares the R-1 Expressway, C-5 Link Communications.

Expressway and the R-1 Extension Expressway Sections of the Manila Cavite Toll
Expressway to be LIMITED ACCESS HIGHWAYS/FACILITIES subject to such rules On 16 May 1974, Presidential Decree No. 458 (PD 458) separated the Bureau of
and regulations that may be imposed by the DPWH thru the Toll Regulatory Board Public Highways from the Department of Public Works, Transportation and
(TRB).
Communications and created it as a department to be known as Department of
Public Highways. Under Section 3 of PD 458, the Department of Public Highways is
In view thereof, the National Capital Region (NCR) of this Department is hereby "responsible for developing and implementing programs on the construction and
ordered, after consultation with the TRB and in coordination with the Philippine maintenance of roads, bridges and airport runways."

National Police (PNP), to close all illegal openings along the said Limited Access
Highways/Facilities. In this connection, the NCR is instructed to organize its own With the amendment of the 1973 Philippine Constitution in 1976, resulting in the
enforcement and security group for the purpose of assuring the continued closure shift in the form of government, national agencies were renamed from Departments
of the right-of-way fences and the implementation of the rules and regulations that to Ministries. Thus, the Department of Public Works, Transportation and
may be imposed by the DPWH thru the TRB.
Communications became the  Ministry of Public Works, Transportation and
Communications.

This Order shall take effect immediately.14

The RTC held that Section 4 of RA 2000 expressly authorized the DPWH to design
limited access facilities and to regulate, restrict, or prohibit access as to serve the
traffic for which such facilities are intended. According to the RTC, such authority to
regulate, restrict, or prohibit logically includes the determination of who and what
can and cannot be permitted entry or access into the limited access facilities. Thus,
the RTC concluded that AO 1, DO 74, and the Revised Rules and Regulations on
On 23 July 1979, then President Ferdinand E. Marcos issued Executive Order No.
546 (EO 546), creating a  Ministry of Public Works  and a  Ministry of
Transportation and Communications.17 Under Section 1 of EO 546, the Ministry
of Public Works  assumed the  public works  functions of the  Ministry of Public
Works, Transportation and Communications. The functions of the  Ministry of
Public Works were the "construction, maintenance and repair of port works, harbor
facilities, lighthouses, navigational aids, shore protection works, airport buildings
and associated facilities, public buildings and school buildings, monuments and Works and the Ministry of Transportation and Communications ' by virtue of EO
other related structures, as well as undertaking harbor and river dredging works, 546. The question is,  which of these two agencies is now authorized to regulate,
reclamation of foreshore and swampland areas, water supply, and flood control and restrict, or prohibit access to limited access facilities?23

drainage works."18

Under Section 1 of EO 546, the Ministry of Public Works (now DPWH) assumed

On the other hand, the Ministry of Transportation and Communications became the  public works functions of the  Ministry of Public Works, Transportation and
the "primary policy, planning, programming, coordinating, implementing, regulating Communications. On the other hand, among the functions of the  Ministry of
and administrative entity of the executive branch of the government in the Transportation and Communications  (now  Department of Transportation and
promotion, development, and regulation of a dependable and coordinated network Communications [DOTC]) were to (1) formulate and recommend national policies
of transportation and communication systems."19 The functions of the Ministry of and guidelines for the preparation and implementation of an integrated and
Transportation and Communications were:
comprehensive transportation and communications systems at the national,
regional, and local levels; and (2) regulate, whenever necessary, activities relative to
A. Coordinate and supervise all activities of the Ministry relative to transportation transportation and communications and prescribe and collect fees in the exercise
and communications;
of such power. Clearly, under EO 546, it is the DOTC, not the DPWH, which has
b. Formulate and recommend national policies and guidelines for the authority to regulate, restrict, or prohibit access to limited access facilities.

preparation and implementation of an integrated and comprehensive

transportation and communications system at the national, regional and local Even under Executive Order No. 125 (EO 125)24 and Executive Order No. 125-A (EO
levels;
125-A),25  which further reorganized the DOTC, the authority to administer and
c. Establish and administer comprehensive and integrated programs for enforce all laws, rules and regulations relative to transportation is clearly with the
transportation and communication, and for this purpose, may call on any agency, DOTC.26

corporation, or organization, whether government or private, whose development

programs include transportation and communications as an integral part to Thus, DO 74 and DO 215 are void because the DPWH has no authority to declare
participate and assist in the preparation and implementation of such programs;
certain expressways as limited access facilities. Under the law, it is the DOTC
d. Regulate, whenever necessary, activities relative to transportation and which is authorized to administer and enforce all laws, rules and regulations in the
communications and prescribe and collect fees in the exercise of such power;
field of transportation and to regulate related activities.

e. Assess, review and provide direction to transportation and communications

research and development programs of the government in coordination with other Since the DPWH has no authority to regulate activities relative to transportation, the
institutions concerned; and
TRB27  cannot derive its power from the DPWH to issue regulations governing
f. Perform such other functions as may be necessary to carry into effect the limited access facilities. The DPWH cannot delegate a power or function which it
provisions of this Executive Order.
does not possess in the first place. Since DO 74 and DO 215 are void, it follows
that the rules implementing them are likewise void.

On 27 July 1981, then President Marcos issued Executive Order No. 710 (EO 710),
which merged the Ministry of Public Works and the Ministry of Public Highways for Whether AO 1 and DO 123 are Unconstitutional

"greater simplicity and economy in operations."21 The restructured agency became

known as the Ministry of Public Works and Highways. Under Section 1 of EO 710 DPWH Secretary Simeon A. Datumanong issued DO 123 on 18 July 2001. DO 123
the functions of the Ministry of Public Works and the Ministry of Public reads in part:

Highways22 were transferred to the Ministry of Public Works and Highways.

SUBJECT: Revised Rules and Regulations Governing Limited Access Highways

Upon the ratification of the 1987 Constitution in February 1987, the former Ministry
of Public Works and Highways became the  Department of Public Works and
Highways (DPWH) and the former Ministry of Transportation and Communications
became the Department of Transportation and Communications (DOTC).
are hereby promulgated for the guidance of all concerned:
By virtue of the authority granted the Secretary of Public Works and Highways
under Section 3 of R.A. 2000, otherwise known as the Limited Access Highway
Act, the following revised rules and regulations governing limited access highways

DPWH issued DO 74 and DO 215 declaring certain expressways as limited access
facilities on 5 April 1993 and 25 June 1998, respectively. Later, the TRB, under the
DPWH, issued the Revised Rules and Regulations on Limited Access Facilities.
However, on 23 July 1979, long before these department orders and regulations
were issued, the  Ministry of Public Works, Transportation and
1. Administrative Order No. 1 dated February 19, 1968, issued by the Secretary of
the then Department of Public Works and Communications, is hereby amended by
deleting the word "motorcycles" mentioned in Section 3(h) thereof.
Therefore, motorcycles are hereby allowed to operate inside the toll roads and
limited access highways, subject to the following:

Communicationswas divided into two agencies - the  Ministry of Public

A.  Motorcycles shall have an engine displacement of at least 400 cubic scope and is the "most essential, insistent and illimitable" of all government
centimeters (cc)provided that:
powers.34 The tendency is to extend rather than to restrict the use of police power.
x x x x
The sole standard in measuring its exercise is reasonableness.35  What is
"reasonable" is not subject to exact definition or scientific formulation. No all-
The RTC's Decision dated 10 March 2003 declared DO 123 unconstitutional on the embracing test of reasonableness exists,36 for its determination rests upon human
ground that it violates the equal protection clause by allowing only motorcycles with judgment applied to the facts and circumstances of each particular case.37

at least 400 cubic centimeters engine displacement to use the toll ways. The RTC
reasoned that the creation of a distinction within the class of motorcycles was not We find that AO 1 does not impose unreasonable restrictions. It merely outlines
based on real differences.
several precautionary measures, to which toll way users must adhere. These rules
were designed to ensure public safety and the uninhibited flow of traffic within
We need not pass upon the constitutionality of the classification of motorcycles limited access facilities. They cover several subjects, from what lanes should be
under DO 123. As previously discussed, the DPWH has no authority to regulate used by a certain vehicle, to maximum vehicle height. The prohibition of certain
limited access highways since EO 546 has devolved this function to the DOTC. types of vehicles is but one of these. None of these rules violates reason. The
Thus, DO 123 is void for want of authority of the DPWH to promulgate it.
purpose of these rules and the logic behind them are quite evident. A toll way is not
an ordinary road. The special purpose for which a toll way is constructed
On the other hand, the assailed portion of AO 1 states:
necessitates the imposition of guidelines in the manner of its use and operation.
Inevitably, such rules will restrict certain rights. But the mere fact that certain rights
Section 3. On limited access highways, it is unlawful for any person or group of are restricted does not invalidate the rules.

persons to:

x x x x
Consider Section 3(g) of AO 1, which prohibits the conduct of rallies inside toll
ways.38  The regulation affects the right to peaceably assemble. The exercise of
(h) Drive any bicycle, tricycle, pedicab, motorcycle or any vehicle (not motorized);
police power involves restriction, restriction being implicit in the power itself. Thus,
x x x x
the test of constitutionality of a police power measure is limited to an inquiry on
whether the restriction imposed on constitutional rights is reasonable, and not
Petitioners assail the DPWH's failure to provide "scientific" and "objective" data on whether it imposes a restriction on those rights.

the danger of having motorcycles plying our highways. They attack this exercise of
police power as baseless and unwarranted. Petitioners belabor the fact that there None of the rules outlined in AO 1 strikes us as arbitrary and capricious. The
are studies that provide proof that motorcycles are safe modes of transport. They DPWH, through the Solicitor General, maintains that the toll ways were not
also claim that AO 1 introduces an unreasonable classification by singling-out designed to accommodate motorcycles and that their presence in the toll ways will
motorcycles from other motorized modes of transport. Finally, petitioners argue that compromise safety and traffic considerations. The DPWH points out that the same
AO 1 violates their right to travel.
study the petitioners rely on cites that the inability of other drivers to detect
motorcycles is the predominant cause of accidents.39 Arguably, prohibiting the use
Petitioners' arguments do not convince us.
of motorcycles in toll ways may not be the "best" measure to ensure the safety and
comfort of those who ply the toll ways.

We emphasize that  the Secretary of the  Department of Public Works and

Communications issued AO 1 on 19 February 1968.
However, the means by which the government chooses to act is not judged in
terms of what is "best," rather, on simply whether the act is reasonable. The validity
Section 3 of RA 200029  authorized the issuance of the guidelines. In of a police power measure does not depend upon the absolute assurance that the
contrast,  DPWH  issued DO 74, DO 215 and DO 123 after EO 546 devolved to purpose desired can in fact be probably fully accomplished, or upon the certainty
the DOTC the authority to regulate limited access highways.
that it will best serve the purpose intended.40  Reason, not scientific exactitude, is
We now discuss the constitutionality of AO 1. Administrative issuances have the the measure of the validity of the governmental regulation. Arguments based on
force and effect of law.30They benefit from the same presumption of validity and what is "best" are arguments reserved for the Legislature's discussion. Judicial
constitutionality enjoyed by statutes.31  These two precepts place a heavy burden intervention in such matters will only be warranted if the assailed regulation is
upon any party assailing governmental regulations. The burden of proving patently whimsical. We do not find the situation in this case to be so.

unconstitutionality rests on such party.32  The burden becomes heavier when the
police power is at issue.
Neither do we find AO 1 oppressive. Petitioners are not being deprived of their right
to use the limited access facility. They are merely being required, just like the rest of
The use of public highways by motor vehicles is subject to regulation as an the public, to adhere to the rules on how to use the facility. AO 1 does not infringe
exercise of the police power of the state.33  The police power is far-reaching in upon petitioners' right to travel but merely bars motorcycles, bicycles, tricycles,
pedicabs, and any non-motorized vehicles as the mode of traveling along limited
access highways.41  Several cheap, accessible and practical alternative modes of
transport are open to petitioners. There is nothing oppressive in being required to
take a bus or drive a car instead of one's scooter, bicycle,  calesa, or motorcycle
upon using a toll way.
would be that a two-wheeled vehicle is less stable and more easily overturned than
Petitioners' reliance on the studies they gathered is misplaced. Police power does
not rely upon the existence of definitive studies to support its use. Indeed, no
requirement exists that the exercise of police power must first be conclusively
justified by research. The yardstick has always been simply whether the
government's act is reasonable and not oppressive.42  The use of "reason" in this
sense is simply meant to guard against arbitrary and capricious government action.
Scientific certainty and conclusiveness, though desirable, may not be demanded in
every situation. Otherwise, no government will be able to act in situations
demanding the exercise of its residual powers because it will be tied up conducting
studies.
A police power measure may be assailed upon proof that it unduly violates
constitutional limitations like due process and equal protection of the law.
43 Petitioners' attempt to seek redress from the motorcycle ban under the aegis of
equal protection must fail. Petitioners' contention that AO 1 unreasonably singles
out motorcycles is specious. To begin with, classification by itself is not prohibited.
44
access to certain destinations, its use, operation, and maintenance require close
A classification can only be assailed if it is deemed invidious, that is, it is not based
on real or substantial differences. As explained by Chief Justice Fernando
in Bautista v. Juinio:45
x x x To assure that the general welfare be promoted, which is the end of law, a
regulatory measure may cut into the rights to liberty and property. Those adversely
affected may under such circumstances invoked the equal protection clause only if
they can show that the governmental act assailed, far from being inspired by the
attainment of the common weal was prompted by the spirit of hostility, or at the
very least, discrimination that finds no support in reason. It suffices then that the
laws operate equally and uniformly on all persons under similar circumstances or
that all persons must be treated in the same manner, the conditions not being
different, both in the privileges conferred and the liabilities imposed. Favoritism and
undue preference cannot be allowed. For the principle is that equal protection and
security shall be given to every person under circumstances, which if not identical
is analogous. If law be looked upon in terms of burden or charges, those that fall
within a class should be treated in the same fashion, whatever restrictions cast on
some in the group equally binding the rest.
construction barriers, etc.), are not suffered by them alone.
We find that it is neither warranted nor reasonable for petitioners to say that the
only justifiable classification among modes of transport is the motorized against the
non-motorized. Not all motorized vehicles are created equal. A 16-wheeler truck is
substantially different from other light vehicles. The first may be denied access to
some roads where the latter are free to drive. Old vehicles may be reasonably
differentiated from newer models.46  We find that real and substantial differences
exist between a motorcycle and other forms of transport sufficient to justify its
classification among those prohibited from plying the toll ways. Amongst all types
of motorized transport, it is obvious, even to a child, that a motorcycle is quite
different from a car, a bus or a truck. The most obvious and troubling difference
a four-wheeled vehicle.
A classification based on practical convenience and common knowledge is not
unconstitutional simply because it may lack purely theoretical or scientific
uniformity. Moreover, we take note that the Philippines is home to a host of unique
motorized modes of transport ranging from modified hand-carts (kuliglig) to bicycle
"sidecars" outfitted with a motor. To follow petitioners' argument to its logical
conclusion would open up toll ways to all these contraptions. Both safety and
traffic considerations militate against any ruling that would bring about such a
nightmare.
Petitioners complain that the prohibition on the use of motorcycles in toll ways
unduly deprive them of their right to travel.
We are not persuaded.
A toll way is not an ordinary road. As a facility designed to promote the fastest
regulation. Public interest and safety require the imposition of certain restrictions on
toll ways that do not apply to ordinary roads. As a special kind of road, it is but
reasonable that not all forms of transport could use it.
The right to travel does not mean the right to choose any vehicle in traversing a toll
way. The right to travel refers to the right to move from one place to another.
Petitioners can traverse the toll way any time they choose using private or public
four-wheeled vehicles. Petitioners are not denied the right to move from Point A to
Point B along the toll way. Petitioners are free to access the toll way, much as the
rest of the public can. The mode by which petitioners wish to travel pertains to the
manner of using the toll way, a subject that can be validly limited by regulation.
Petitioners themselves admit that alternative routes are available to them. Their
complaint is that these routes are not the safest and most convenient. Even if their
claim is true, it hardly qualifies as an undue curtailment of their freedom of
movement and travel. The right to travel does not entitle a person to the best form
of transport or to the most convenient route to his destination. The obstructions
found in normal streets, which petitioners complain of (i.e., potholes, manholes,
Finally, petitioners assert that their possession of a driver's license from the Land
Transportation Office (LTO) and the fact that their vehicles are registered with that
office entitle them to use all kinds of roads in the country. Again, petitioners are
mistaken. There exists no absolute right to drive. On the contrary, this privilege, is
heavily regulated. Only a qualified group is allowed to drive motor vehicles: those
who pass the tests administered by the LTO. A driver's license issued by the LTO
merely allows one to drive a particular mode of transport. It is not a license to drive January 5, 1965, CAB granted said urgent petition of Fairways. The pertinent part of
or operate any form of transportation on any type of road. Vehicle registration in the said resolution provides: 

LTO on the other hand merely signifies the roadworthiness of a vehicle. This does 

not preclude the government from prescribing which roads are accessible to certain "Filipinas Orient Airways, Inc., (FAIRWAYS) having presented to the Board evidence
vehicles.
showing prima facie its fitness, willingness and ability to operate the services
applied for and the public need for more air transportation service, and to
WHEREFORE, we  PARTLY GRANT  the petition. We  MODIFY  the Decision dated encourage and develop commercial air transportation, RESOLVED, to grant, as the
10 March 2003 of the Regional Trial Court, Branch 147, Makati City and its Order Board hereby grants, the said Filipinas Orient Airways, Inc., provisional authority to
dated 16 June 2003 in Civil Case No. 01-034. We declare VOID Department Order operate scheduled and non-scheduled domestic air services with the use of DC-3
Nos. 74, 215, and 123 of the Department of Public Works and Highways, and the aircraft, subject to the following conditions:chanrob1es virtual 1aw library

Revised Rules and Regulations on Limited Access Facilities of the Toll Regulatory 

Board. We declare  VALID  Administrative Order No. 1 of the Department of Public 1. The term of the provisional authority herein granted shall be until such time as
Works and Communications.
the main application for a certificate of public convenience and necessity is finally
decided or for such period as the Board may at any time determine;

SO ORDERED.


x       x       x" 



A reconsideration of this resolution having been denied, PAL filed the present civil
EN BANC
 action alleging that, in issuing said resolution, CAB had acted illegally and in excess
[G.R. No. L-24219. June 13, 1968.]
 of its jurisdiction or with grave abuse of discretion, because: 


 

PHILIPPINE AIR LINES, INC., Petitioner, v. CIVIL AERONAUTICS BOARD, and (1) CAB is not empowered to grant any provisional authority to operate, prior to the
FILIPINAS ORIENT AIRWAYS, INC., Respondents.
 submission for decision of the main application for a certificate of public
convenience and necessity;

D E C I S I O N


(2) CAB had no evidence before it that could have justified the granting of the
CONCEPCION, J.:
provisional authority complained of;



(3) PAL was denied due process when CAB granted said authority before the
Original petition for  certiorari, to set aside and annul a resolution of the Civil presentation of its evidence on Fairways’ main application; and

Aeronautics Board — hereinafter referred to as CAB — granting respondent 

Filipinas Orient Airways, Inc. — hereinafter referred to as Fairways — "provisional (4) In granting said provisional authority, the CAB had prejudged the merits of said
authority to operate scheduled and non-scheduled domestic air services with the application.

use of DC-3 aircrafts", subject to specified conditions.
 


 The first ground is devoid of merit. Section 10-C(1) of Republic Act No. 776,
Pursuant to Republic Act No. 4147, granting thereto "a franchise to establish, reading: 

operate and maintain transport services for the carriage of passengers, mail, 

industrial flights and cargo by air in and between any and all points and places "(C) The Board shall have the following specific powers and duties:chanrob1es
throughout the Philippines and other countries", on September 16, 1964, Fairways virtual 1aw library

filed with CAB the corresponding application for a "certificate of public 

convenience and necessity", which was docketed as economic proceedings (EP) (1) In accordance with the provisions of Chapter IV of this Act, to issue, deny,
No. 625, and was objected to by herein petitioner, Philippine Air Lines, Inc., amend, revise, alter, modify, cancel, suspend or revoke, in whole or in part, upon
hereinafter referred to as PAL. Subsequently, a CAB hearing officer began to receive petitioner complaint, or upon its own initiative, any temporary operating permit or
evidence on said application. After several hearings before said officer, or on Certificate of Public Convenience and Necessity; Provided, however, That in the
December 14, 1964, Fairways filed an "urgent petition for provisional authority to case of foreign air carriers, the permit shall be issued with the approval of the
operate" under a detailed "program of implementation" attached to said petition, President of the Republic of the Philippines . . ."cralaw virtua1aw library

and for the approval of its bond therefor, as well as the provisional approval of its 

"tariff regulations and the conditions of carriage to be printed at the back of the explicitly authorizes CAB to issue a "temporary operating permit," and nothing
passenger tickets." Despite PAL’s opposition thereto, in a resolution issued on contained, either in said section, or in Chapter IV of Republic Act No. 776, negates
the power to issue said "permit", before the completion of the applicant’s evidence
and that of the oppositor thereto on the main petition. Indeed, the CAB’s authority
to grant a temporary permit "upon its own initiative," strongly suggests the power
to exercise said authority, even before the presentation of said evidence has begun.
 merely on the prima facie effect of the evidence so far introduced and do not


Moreover, we perceive no cogent reason to depart, in connection with the
commercial air transport service, from the policy of our public service law, which
sanctions the issuance of temporary or provisional permits or certificates of public
convenience and necessity, before the submission of a case for decision on the
merits. 1 The overriding considerations in both instances are the same, namely, that
Lastly, the provisional nature of the permit granted to Fairways refutes the assertion
that it prejudges the merits of Fairways’ application and PAL’s opposition thereto.
As stated in the questioned order, CAB’s findings therein made reflect its view
connote a pronouncement or an advanced expression of opinion on the merits of
the case.



WHEREFORE, the petition herein should be, as it is hereby dismissed, and the writ
prayed for denied, with costs against petitioner, Philippine Air Lines, Inc. It is so
ordered.

the service be required by public convenience and necessity, and, that the
applicant is fit, as well as willing and able to render such service properly, in
conformity with law and the pertinent rules, regulations and requirements. 2 



As regards PAL’s second contention, we have no more than PAL’s assertion and
conclusion regarding the absence of substantial evidence in support of the finding,
in the order complained of, to the effect that Fairways’ evidence had established"
prima facie" its fitness, willingness and ability to operate the services applied for
and the public need for more transportation service . . ." Apart from PAL’s assertion
being contradicted by the tenor of said order, there is the legal presumption that
official duty has been duly performed.



Such presumption is particularly strong as regards administrative agencies, like the
CAB, vested with powers said to be quasi-judicial in nature, in connection with the
enforcement of laws affecting particular fields of activity, the proper regulation and/
or promotion of which requires a technical or special training, aside from a good
knowledge and grasp of the overall conditions, relevant to said field, obtaining in
the nation. 3 The consequent policy and practice underlying our Administrative Law
is that courts of justice should respect the findings of fact of said administrative
agencies, unless there is absolutely no evidence in support thereof or such
evidence is clearly, manifestly and patently insubstantial. 4 This, in turn, is but a
recognition of the necessity of permitting the executive department to adjust law
enforcement to changing conditions, without being unduly hampered by the rigidity
and the delays often attending ordinary court proceedings or the enactment of new
or amendatory legislations. In the case at bar, petitioner has not satisfactorily
shown that the aforementioned findings of the CAB are lacking in the necessary
evidentiary support.



Needless to say, the case of Ang Tibay v. C.I.R. 5 on which petitioner relies, is not in
point. Said case refers to the conditions essential to a valid decision on the merits,
from the viewpoint of due process, whereas, in the case at bar, we are concerned
with an interlocutory order prior to the rendition of said decision. In fact,
interlocutory orders may sometimes be issued ex parte, particularly, in
administrative proceedings, without previous notice and hearing, consistently with
due process. 6 Again, the constitutional provision to the effect that "no decision
shall be rendered by any court of record without expressing therein clearly and
distinctly the facts and the law on which it is based", 7 applies, not to such
interlocutory orders, but to the determination of the case on the merits. 8 



EXECUTIVE ORDER NO. 125-A April 13, 1987
government corporate entities attached to the Department shall
AMENDING EXECUTIVE ORDER NO. 125, ENTITLED "REORGANIZING THE
MINISTRY OF TRANSPORTATION AND COMMUNICATIONS. DEFINING ITS
POWERS AND FUNCTIONS, AND FOR OTHER PURPOSES."
WHEREAS, considering the peculiar situation obtaining in the Department of
Transportation and Communications (DOTC), there is a compelling need to clarify
and/or modify structural and functional organization of the Department as provided
under Executive Order No. 125 in order to ensure compliance with its mandate and
the attainment of the corresponding objectives as specified in Section 4 of said
Executive Order.
NOW, THEREFORE, I, CORAZON C. AQUINO, President of the Republic of the
Philippines, by virtue of the powers vested in me by the Constitution, do hereby
order:
Sec. 1. Sections 5, 8, 9, 10 and 11 of Executive Order No. 125, otherwise known as
the Reorganization Act of the Ministry of Transportation and Communications, are
hereby amended to read as follows:
"Sec. 5. Powers and Functions. To accomplish its mandate, the
Department shall have the following powers and functions:
telecommunications facilities in areas not adequately served by
(a) Formulate and recommend national policies and guidelines for
the preparation and implementation of integrated and
comprehensive transportation and communications systems at
the national, regional and local levels;
(k) Establish and prescribe rules and regulations for the operation
(b) Establish and administer comprehensive and integrated
programs for transportation and communications, and for this
purpose, may call on any agency, corporation, or organization,
whether public or private, whose development programs include
transportation and communications as an integral part thereof, to
participate and assist in the preparation and implementation of
such program;
(c) Assess, review and provide direction to transportation and
communication research and development programs of the
government in coordination with other institutions concerned;
(d) Administer and enforce all laws, rules and regulations in the
field of transportation and communications;
airmen;
(e) Coordinate with the Department of Public Works and
Highways in the design, location, development, rehabilitation,
improvement, construction, maintenance and repair of all
infrastructure projects and facilities of the Department. However,
be authorized to undertake specialized telecommunications,
ports, airports and railways projects and facilities as directed by
the President of the Philippines or as provided by law;
(f) Establish, operate and maintain a nationwide postal system
that shall include mail processing, delivery services, and money
order services and promote the art of philately;
(g) Issue certificates of public convenience for the operation of
public land and rail transportation utilities and services;
(h) Accredit foreign aircraft manufacturers and/or international
organizations for aircraft certification in accordance with
established procedures and standards;
(i) Establish and prescribe rules and regulations for identification
of routes, zones and/or areas of operations of particular
operators of public land services;
(j) Establish and prescribe rules and regulations for the
establishment, operation and maintenance of such
the private sector in order to render such domestic and overseas
services that are necessary with due consideration for advances
in technology;
and maintenance of a nationwide postal system that shall include
mail processing, delivery services, money order services and
promotion of philately;
(l) Establish and prescribe rules and regulations for issuance of
certificates of public convenience for public land transportation
utilities, such as motor vehicles, trimobiles and railways;
(m) Establish and prescribe rules and regulations for the
inspection and registration of air and land transportation facilities,
such as motor vehicles, trimobiles, railways and aircrafts;
(n) Establish and prescribe rules and regulations for the issuance
of licenses to qualified motor vehicle drivers, conductors, and
(o) Establish and prescribe the corresponding rules and
regulations for the enforcement of laws governing land
transportation, air transportation and postal services, including
 the penalties for violations thereof, and for the deputation of c) Office of the Assistant Secretary for Planning and Project
appropriate law enforcement agencies in pursuance thereof;
Development;

1) Planning Service, and

(p) Determine, fix and/or prescribe charges and/or rates pertinent 2) Project Development Service

to the operation of public air and land transportation utility

facilities and services, except such rates and/or charges as may (d) Office of the Assistant Secretary for Management Information
be prescribed by the Civil Aeronautics Board under its charter, Service and Project Management;

and, in cases where charges or rates are established by 1) Management Information Service, and

international bodies or associations of which the Philippines is a 2) Project Management Service

participating member or by bodies or associations recognized by e) Office of the Assistant Secretary for Land Transportation;

the Philippine government as the proper arbiter of such charges (f) Office of the Assistant Secretary for Postal Services;

or rates;
(g) Office of the Assistant Secretary for Telecommunications;

(h) Office of the Assistant Secretary for Air Transportation.

(q) Establish and prescribe the rules, regulations, procedures and

standards for the accreditation of driving schools;
Each of the above-named services shall be headed by a service chief
appointed by the President upon the recommendation of the Secretary."

(r) Administer and operate the Civil Aviation Training Center

(CATC) and the National Telecommunications Training Institute Sec. 10. Structural Organization. The Department, aside from the
(NTTI); and
Department proper which is comprised of the Offices of the Secretary,
Undersecretary and Assistant Secretaries shall include the Department
(s) Perform such other powers and functions as may be regional offices and the attached agencies and corporations referred to in
prescribed by law, or as may be necessary, incidental, or proper Section 14 hereof.

to its mandate or as may be assigned from time to time by the

President of the Republic of the Philippines."
The Office of the Secretary shall have direct line supervision and control
over the Department regional offices. The Department proper shall be
"Sec. 8. Undersecretaries. The Secretary shall be assisted by four (4) responsible for developing and implementing policies, plans, programs
Undersecretaries Appointed by the President upon the recommendation of and projects for the Department."

the Secretary.

"Sec. 11. Department Regional Offices. The Department shall have three
"Sec. 9. Assistant Secretaries and Service Chiefs. The Secretary shall also (3) Department Regional Offices in each of the administrative regions of
be assisted by eight (8) Assistant Secretaries appointed by the President the country: the Department Regional Office for land Transportation, the
upon the recommendation of the Secretary, each of whom shall Department Regional Office for Telecommunications and the Department
respectively be responsible for the following four (4) staff offices Regional Office for Postal Services. The present Regional Offices of the
composed of eight (8) services and four (4) line offices, and shall report to Land Transportation Commission are hereby abolished and their functions
the respective Undersecretaries assigned by the Secretary, which are transferred to the respective Department Regional Offices for Land
Undersecretary shall have control and supervision over said respective Transportation. The present Regional Offices of the Bureau of
services and offices:
Telecommunications are hereby abolished and their functions are
transferred to the respective Department Regional Offices for
(a) Office of the Assistant Secretary for Administrative and Legal Telecommunications. The present Regional Offices of the Bureau of Posts
Affairs;
are hereby abolished and their functions are transferred to the
1) Administrative Service, and
corresponding Department Regional Offices for Postal Services. Each
2) Legal Service
Department Regional Office shall be headed by a Department Regional
Director and assisted by a Department Assistant Regional Director. The
(b) Office of the Assistant Secretary for Finance and present Airport Offices of the Bureau of Air Transportation are hereby
Comptrollership;
abolished and their functions are transferred to the Department Airport
1) Finance and Management Service, and
Offices. The abolition of the herein Regional Offices and the transfer of
2) Comptrollership Service
their functions shall be governed by the provisions of Section 15 (b)
hereof.

 the Philippine Coast Guard and other law enforcement agencies

The Department Regional Offices shall essentially be line in character and to effectively discharge these functions;

shall be responsible for the delivery of all front line services of the
Department.
(g) Undertake the issuance of licenses to qualified seamen and
harbor, bay and river pilots;

For such purposes, the Department Regional Offices shall have within their
respective administrative regions, the following functions:
(h) Determine, fix and/or prescribe charges and/or rates pertinent
to the operation of public water transport utilities, facilities and
(a) Implement laws, and policies, plans, programs, projects, rules services except in cases where charges or rates are established
and regulations of the Department;
by international bodies or associations of which the Philippines is
(b) Provide efficient, and effective service to the people;
a participating member or by bodies or associations recognized
(c) Coordinate with regional offices of other departments, offices by the Philippine Government as the proper arbiter of such
and agencies;
charges or rates.

(d) Coordinate with local government units;

(e) Perform such other functions as may be provided by law."

(i) Accredit marine surveyors and maritime enterprises engaged in
shipbuilding, shiprepair, shipbreaking, domestic and overseas
Sec. 2. Sections 12, 13, 15 and 16 of said Executive Order are hereby deleted.
shipping ship management and agency;

Sec. 3. Section 14 of said Executive Order is hereby renumbered as Section 12 and (j) Issue and register the continuous discharge book of Filipino
amended to read as follows:
seamen;

"Sec. 12. Maritime Industry Authority. The Maritime Industry Authority is (k) Establish and prescribe rules and regulations, standards and
hereby retained and shall have the following functions:
procedures for the efficient and effective discharge of the above
functions;

(a) Develop and formulate plans, policies, programs, projects,

standards, specifications and guidelines geared toward the (l) Perform such other functions as may now or hereafter be
promotion and development of the maritime industry, the growth provided by law."

and effective regulation of shipping enterprises, and for the

national security objectives of the country;
Sec. 4. Section 17 of Executive Order No. 125 is hereby renumbered as Section 13
and amended to read as follows:

(b) Establish, prescribe and regulate routes, zones and/or areas of

operation of particular operators of public water services;
"Sec. 13. Abolition/Transfer/Consolidation:

(c) Issue Certificates of Public Convenience for the operation of (a) The Land Transportation Commission is hereby abolished and
domestic and overseas water carriers;
its staff functions are transferred to the service offices of the
Department Proper and its line functions are transferred to the
(d) Register vessels as well as issue certificates, licenses or Department Regional Offices for Land Transportation as provided
documents necessary or incident thereto;
in Section 11 herein. Such transfer of functions is subject to the
provisions of Section 15 (b) hereof. The quasi-judicial powers and
(e) Undertake the safety regulatory functions pertaining to vessel functions of the Commission are transferred to the Department.
construction and operation including the determination of The corresponding position structure and staffing pattern shall be
manning levels and issuance of certificates of competency to approved and prescribed by the Secretary pursuant to Section 16
seamen;
hereof.

(f) Enforce laws, prescribe and enforce rules and regulations, (b) PNL Leasing, Inc. is hereby abolished and its functions are
including penalties for violations thereof, governing water transferred to Philippine National Lines, Inc. subject to the
transportation and the Philippine merchant marine, and deputize provisions of Section 15 (b) hereof. The Secretary of
 Transportation and Communications or his designated Section 2. Mandate. - The Department of Transportation and Communications shall
representative shall be the Chairman of the Board.
be the primary policy, planning, programming, coordinating, implementing,
regulating and administrative entity of the Executive Branch of the government in
(c) The National Aero Manufacturing, Inc. and the Philippine Aero the promotion, development and regulation of dependable and coordinated
Systems, Inc. are hereby abolished in accordance with the networks of transportation and communications systems as well as in the fast,
provisions of Section 15 (a) hereof.
safe, efficient and reliable postal, transportation and communications services.

(d) The Civil Aeronautics Board is hereby transferred from the Section 3. Powers and Functions.- To accomplish its mandate, the Department
Department of Tourism to the Department as an attached agency shall:

in accordance with the provision of Section 15 (a) hereof. The

Secretary of Transportation and Communications or his
designated representative shall be the Chairman of the Board.
preparation and implementation of integrated and comprehensive
(e) The Maritime Training Council's function of issuing certificates
(1) Formulate and recommend national policies and guidelines for the
transportation and communications systems at the national, regional and
local levels;

of competency to seamen under LOI 1404 is hereby transferred

to the Maritime Industry Authority."
(2) Establish and administer comprehensive and integrated programs for
transportation and communications, and for this purpose, it may call on
Sec. 5. Sections 18, 19, 20, 21, 22, 23, 24, 25 and 26 of said Executive Order are any agency, corporation or organization, whether public or private, whose
hereby renumbered as Sections 14, 15, 16, 17, 18, 19, 20, 21 and 22, respectively.
development programs include transportation and communications as
integral parts thereof, to participate and assist in the preparation and
Sec. 6. Section 27 of said Executive Order is hereby renumbered as Section 23 and implementation of such programs;

amended as follows;

(3) Assess, review and provide direction to transportation and

"Sec. 23. Repealing Clause. Presidential Decree No. 890, Letter of communications research and development programs of the government
Instruction Nos. 263 and 371 Executive Order No. 1011 dated March 20, in coordination with other institutions concerned;

1985 are hereby repealed. All laws ordinances, rules, regulations, other
issuances or parts thereof which are inconsistent with this Executive Order (4) Administer and enforce all laws, rules and regulations in the field of
are hereby repealed or modified accordingly."
transportation and communications;

Sec. 7. Section 28 of said Executive Order is hereby renumbered as Section 24.

(5) Coordinate with the Department of Public Works and Highways in the
Sec. 8. This Executive Order shall take effect immediately upon its approval.
maintenance and repair of all infrastructure projects and facilities of the
ADMINISTRATIVE CODE OF 1987; Title XV, Section 9(1)
Title XV
TRANSPORTATION AND COMMUNICATIONS
design, location, development, rehabilitation, improvement, construction,
Department. However, government corporate entities attached to the
Department shall be authorized to undertake specialized
telecommunications, ports, airports and railways projects and facilities as
directed by the President of the Philippines or as provided by law;

CHAPTER 1
 (6) Establish, operate and maintain a nationwide postal system that shall
GENERAL PROVISIONS include mail processing, delivery services and money order services and
promote the art of philately;

Section 1. Declaration of Policy. - The State is committed to the maintenance and

expansion of viable, efficient, fast, safe and dependable transportation and (7) Issue certificates of public convenience for the operation of public land
communications systems as effective instruments for national recovery and and rail transportation utilities and services;

economic progress. It shall not compete as a matter of policy with private

enterprise and shall operate transportation and communications facilities only in (8) Accredit foreign aircraft manufacturers or international organizations for
those areas where private initiatives are inadequate or non-existent.
aircraft certification in accordance with established procedures and
standards;

 (9) Establish and prescribe rules and regulations for identification of routes,
zones or areas of operation of particular operators of public land services;
Section 5. Office of the Secretary. - The Office of the Secretary shall consist of the
Secretary, his immediate staff, the Franchising Review Staff and the Investigation,
(10) Establish and prescribe rules and regulations for the establishment, Security and Law Enforcement Staff.

operation and maintenance of such telecommunications facilities in areas

not adequately served by the private sector in order to render such The Franchising Review Staff shall be headed by a Review Staff Director with the
domestic and overseas services that are necessary with due consideration same rank, salary and privileges of a Department Regional Director who shall be
for advances in technology;
appointed by the President upon the recommendation of the Secretary. The
Franchising Review Staff shall assist the Secretary in the review of cases and
(11) Establish and prescribe rules and regulations for the issuance of matters pertaining to, among others, grants of franchises and the regulation
certificates of public convenience for public land transportation utilities, thereof.

such as motor vehicles, trimobiles and railways;

The Investigation, Security and Law Enforcement Staff shall be headed by a Staff
(12) Establish and prescribe rules and regulations for the inspection and Director with the same rank, salary and privileges of a Department Service Chief.
registration of air and land transportation facilities, such as motor vehicles, The Investigation, Security and Law Enforcement Staff shall be responsible for: (a)
trimobiles, railways and aircraft;
providing security and intelligence for the Department; (b) coordinating security and
intelligence activities of security units of its offices and attached agencies; and (c)
(13) Establish and prescribe rules and regulations for the issuance of undertaking law enforcement, functions and activities relating to land
licenses to qualified motor vehicle drivers, conductors and airmen;
transportation.

(14) Establish and prescribe the corresponding rules and regulations for Section 6. Undersecretaries. - The Secretary shall be assisted by four (4)
enforcement of laws governing land transportation, air transportation and Undersecretaries. Each Undersecretary shall have control and supervision over the
postal services, including the penalties for violations thereof, and for the respective offices and services assigned to him by the Secretary.

deputation of appropriate law enforcement agencies in pursuance thereof;

Section 7. Assistant Secretaries. - The Secretary shall also be assisted by eight (8)
(15) Determine, fix or prescribe charges or rates pertinent to postal Assistant Secretaries each of whom shall be responsible for the four (4) staff offices
services and to the operation of public air and land transportation utility and four (4) line offices. Each Assistant Secretary shall report to the respective
facilities and services, except such rates or charges as may be prescribed Undersecretary to whom he is assigned by the President.

by the Civil Aeronautics Board under its charter and, in cases where
charges or rates are established by international bodies or associations of Section 8. Staff Offices. - The Department shall have the following staff offices:

which the Philippines is a participating member or by bodies or (1) The Office of the Assistant Secretary for Administrative and Legal
associations recognized by the Philippine government as the proper Affairs composed of the Administrative Service and the Legal Service;

arbiter of such charges or rates;

(2) The Office of the Assistant Secretary for Finance and Comptrollership
composed of the Finance and Management Service and the
(16) Establish and prescribe the rules, regulations, procedures and Comptrollership Service;

standards for the accreditation of driving schools;

(3) The Office of the Assistant Secretary for Planning and Project
Development composed of the Planning Service and the Project
(17) Administer and operate the Civil Aviation Training Center (CATC) and Development Service; and

the National Telecommunications Training Institute (NTTI); and

(4) The Office of the Assistant Secretary for Management Information and
Project Management composed of the Management Information Service
(18) Perform such other powers and functions as may be provided by law.
and the Project Management Service.

Section 4. Organizational Structure.  - The Department shall consist of the Section 9. Line Offices. - The Department shall have the following line offices:

Department Proper, the Department Regional Offices, the Land Transportation (1) The Office of the Assistant Secretary for Land Transportation;

Franchising and Regulatory Board, and the Attached Agencies.

(2) The Office of the Assistant Secretary for Postal Services;

(3) The Office of the Assistant Secretary for Telecommunications; and

CHAPTER 2
 (4) The Office of the Assistant Secretary for Air Transportation.

DEPARTMENT PROPER
The line offices shall each have an Executive Director who shall assist the (5) To perform such other functions and duties as may be provided by law,
respective Assistant Secretary in the implementation and enforcement of the or as may be necessary, or proper or incidental to its powers and
policies, programs and projects, and the pertinent laws on their respective areas of functions.

responsibilities.

CHAPTER 3

Section 10. Service Units in the Office of the Assistant Secretary for Land DEPARTMENT SERVICES
Transportation.  - There shall be two service units in the Office of the Assistant
Secretary for Land Transportation, namely:
Section 13. Department Services.  - The Department Services shall include the
following:

(1) Law Enforcement Service, and

(2) Traffic Adjudication Service.

(1) Administrative Service;

(2) Legal Service;

Each of the aforesaid service units shall be headed by a Service Chief to be (3) Finance and Management Service;

appointed by the President upon recommendation of the Secretary of (4) Comptrollership Service;

Transportation and Communication.

(5) Planning Service;

(6) Project Development Service;

Section 11. Functions of the Law Enforcement Service.  - The Law Enforcement (7) Management Information Service; and

Service shall have the same functions and powers as those that the former Law (8) Project Management Service.

Enforcement Division in the Office of the Assistant Secretary for Land

Transportation exercised.
Each of the above named services shall be headed by a Service Chief appointed by
the President upon the recommendation of the Secretary.

Section 12. Functions of the Traffic Adjudication Service. - The Traffic Adjudication
Service shall have the following powers and functions:
CHAPTER 4

REGIONAL OFFICES
(1) To hear and decide cases involving violations of laws, rules and
regulations governing land transportation and to impose fines and/or Section 14. Regional Offices.  - The Department shall have three (3) Regional
penalties therefor; provided that violations resulting in damage to property Offices in each of the administrative regions of the country: the Regional Office for
and/or physical injuries or violations constituting offenses punishable Land Transportation, the Regional Office for Telecommunications and the Regional
under the Revised Penal Code and other penal laws shall be under the Office for Postal Services. Each Regional Office shall be headed by a Regional
jurisdiction of the regular courts;
Director to be assisted by an Assistant Regional Director.

(2) To order the impounding of motor vehicles and confiscation of plates or The Regional Offices shall essentially be line in character and shall be responsible
the arrest of violators of laws, rules and regulations governing land for the delivery of all front line services of the Department.

transportation;

For such purposes, the Regional Offices shall have, within their respective
(3) To issue subpoena and subpoena duces tecum and to summon administrative regions, the following functions:

witnesses to appear in any proceedings thereof, and to administer oaths

and affirmations;
(1) Implement laws, policies, plans, programs, projects, rules and
regulations of the Department;

(4) To promulgate rules and regulations governing the proceedings before (2) Provide efficient and effective service to the people;

it; provided that except with respect to paragraph c, the rules of procedure (3) Coordinate with regional offices of other departments, offices and
and evidence prevailing in the courts of law shall not be controlling and all agencies;

reasonable means to ascertain the facts in each case shall be used (4) Coordinate with local government units; and

without regard to technicalities of law and procedures but all in the interest (5) Perform such other functions as may be provided by law.

of due process; and

The Office of the Secretary shall have direct line supervision and control over
Regional Offices.

CHAPTER 5

REGULATORY BOARD (4) Issue preliminary or permanent injunctions, whether prohibitory or
mandatory, in all cases in which it has jurisdiction and in which cases the
Section 15. Land Transportation Franchising and Regulatory Board.  - The quasi- pertinent provisions of the Rules of Court shall apply;

judicial powers and functions with respect to land transportation shall be exercised
through the Land Transportation and Regulatory Board, hereinafter referred to as (5) Punish for contempt of the Board, both direct and indirect, in
the "Board".
accordance with the pertinent provisions of, and the penalties prescribed
by, the Rules of Court;

Section 16. Composition of the Board.  - The Board shall be composed of a

Chairman and two (2) members with the rank, salary and privileges of an Assistant
Secretary, all of whom shall be appointed by the President of the Philippines upon
recommendation of the Secretary of Transportation and Communications. One (1)
member of the Board shall be a member of the Bar and shall have been engaged in
the practice of law in the Philippines for at least five (5) years, another a holder of a
(6) Issue subpoena and subpoena duces tecum and to summon witnesses
to appear in any proceedings of the Board, to administer oaths and
affirmations, and, in appropriate cases, to order the search and seizure of
all vehicles and documents, upon probable cause and as may be
necessary for the proper disposition of the cases before it;

degree in civil engineering, and the other a holder of a degree in economics, finance
or management both with the same number of years of experience and practice.
public service laws on land transportation and of the Board's rules and
Section 17. Executive Director and Support Staff of the Board.  - The Board shall
(7) Conduct investigations and hearings of complaints for violation of the
regulations, orders, decisions or rulings and to impose fines or penalties
for such violations;

have an Executive Director who shall also be appointed by the President of the
Philippines upon the recommendation of the Secretary of Transportation and (8) Review motu propio the decisions/actions of the Regional Franchising
Communications. He shall have the rank, salary and privileges of a Department and Regulatory Offices;

Service Chief. He shall assist the Board in the performance of its powers and
functions.
(9) Promulgate rules and regulations governing proceedings before the
The Board shall be supported by the Technical Evaluation Division, Legal Division, Board and the Regional Franchising and Regulatory Office. However,
Management Information Division, Administrative Division and Finance Division.
except with respect to paragraphs 4, 5, 6, and 7 hereof, the rules of
procedure and evidence prevailing in the courts of law should not be
Section 18. Supervision and Control Over the Board.  - The Secretary of controlling but rather the spirit and intention of said rules. The Board and
Transportation and Communications, through his duly designated Undersecretary, the Regional Franchising and Regulatory Offices shall use every and all
shall exercise administrative supervision and control over the Land Transportation reasonable means to ascertain facts in each case speedily and objectively
Franchising and Regulatory Board.
and without regard to technicalities of law and procedures, all in the
interest of due process;

Section 19. Powers and Functions of the Land Transportation Franchising and
Regulatory Board. - The Board shall:
(10) Fix, impose and collect, and periodically review and adjust,
reasonable fees and other related charges for services rendered;

(1) Prescribe and regulate routes, economically viable capacities, and

zones or areas of operation of public land transportation services provided (11) Formulate, promulgate, administer, implement and enforce rules and
by motorized vehicles in accordance with the public land transportation regulations on land transportation public utilities, standards of
development plans and programs approved by the Department of measurements or design, and rules and regulations requiring operators of
Transportation and Communications;
any public land transportation service to equip, install and provide in their
utilities and in their stations such devices, equipment, facilities and
(2) Issue, amend, revise, suspend or cancel Certificates of Public operating procedures and techniques as may promote safety, protection,
Convenience or permits authorizing the operation of public land comfort and convenience to persons and property in their charges as well
transportation services provided by motorized vehicles, and prescribe the as the safety of persons and property within their areas of operation;

appropriate terms and conditions therefor;

(12) Coordinate and cooperate with other government agencies and

(3) Determine, prescribe, approve and periodically review and adjust entities concerned with any aspect involving public land transportation
reasonable fares, rates and other related charges, relative to the operation services with the end in view of effecting continuing improvement of such
of public land transportation services provided by motorized vehicles;
services; and

 (13) Perform such other functions and duties as may be provided by law,
EXECUTIVE ORDER NO. 202 June 19, 1987

or as may be necessary, or proper or incidental to the purposes and

objectives of the Department;

CREATING THE LAND TRANSPORTATION FRANCHISING AND REGULATORY

BOARD
Section 20. Decisions of the Board; Appeals therefrom or Review Thereof .  - The
Board, in the exercise of its powers and functions, shall sit and render its decision
WHEREAS, the Department of Transportation and Communications is vested with,
en banc. Every such decision, order, or resolution of the Board must bear the
among others, quasi-judicial powers and functions pursuant to Executive Order No.
concurrence and signature of at least two (2) members thereof.

125, as amended;

The decision, order or resolution of the Board shall be appealable to the Secretary
within thirty (30) days from receipt of the decision. However, the Secretary may
NOW, THEREFORE, I, CORAZON C. AQUINO, President of the Philippines, do
motu propio review and decision or action of the Board before the same becomes
hereby order:

final.

Sec. 1. Creation of the Land Transportation Franchising and Regulatory Board.

Section 21. Regional Franchising and Regulatory Offices.  - There shall be a
There is hereby created in the Department of Transportation and Communications,
Regional Franchising and Regulatory Office in each of the administrative regions of
the Land Transportation Franchising and Regulatory Board hereinafter referred to as
the country which shall be headed by a Regional Director having the rank, salary
the "Board".

and privileges of a Department Assistant Regional Director. The Regional

Franchising and Regulatory Offices shall hear and decide uncontested applications/
Sec. 2. Composition of the Board. The Board shall be composed of a Chairman and
petitions for routes, within their respective administrative regions but that
two (2) members with the same rank, salary and privileges of an Assistant
applications/petitions for routes extending beyond their respective territorial
Secretary, all of whom shall be appointed by the President of the Philippines upon
jurisdiction shall be heard and decided by the Board.

recommendation of the Secretary of Transportation and Communications. One (1)

member of the Board shall be a member of the Bar and shall have engaged in the
Section 22. Appeals.  - The decisions, orders or resolutions of the Regional
practice of law in the Philippines for at least five (5) years, another a holder of a
Franchising and Regulatory Offices shall be appealable to the Board within thirty
degree in civil engineering, and the other a holder of a degree in economics, finance
(30) days from receipt of the decision.

or management both with the same number of years of experience and practice.

CHAPTER 6

Sec. 3. Executive Director and Support Staff of the Board. The Board shall have an
ATTACHED AGENCIES
Executive Director who shall also appointed by the President of the Philippines
upon the recommendation of the Secretary of Transportation and Communications.
Section 23. Attached Agencies and Corporations. - The following agencies and
He shall have the rank, salary and privileges of a Department Service Chief. He
corporations are attached to the Department: The Philippine National Railways, the
shall assist the Board in the performance of its powers and functions.

Maritime Industry Authority, the Philippine National Lines, the Philippine Aerospace
Development Corporation, the Metro Manila Transit Corporation, the Office of
The Board shall be supported by the Technical Evaluation Division, Legal Division,
Transport Cooperatives, the Philippine Ports Authority, the Philippine Merchant
Management Information Division, Administrative Division and Finance Division.

Marine Academy, the Toll Regulatory Board, the Light Rail Transit Authority, the
Transport Training Center, the Civil Aeronautics Board, the National
Sec. 4. Supervision and Control Over the Board. The Secretary of Transportation
Telecommunications Commission and the Manila International Airport Authority.

and Communications, through his duly designated Undersecretary, shall exercise

administrative supervision and control over the Land Transportation Franchising
Section 24. Functions of Attached Agencies and Corporations.  - The Agencies
and Regulatory Board.

attached to the Department shall continue to operate and function in accordance

with the respective charters or laws creating them, except when they conflict with
Sec. 5. Powers and Functions of the Land Transportation Franchising and
this Code.

Regulatory Board. The Board shall have the following powers and functions:

a. To prescribe and regulate routes of service, economically viable

capacities and zones or areas of operation of public land transportation
services provided by motorized vehicles in accordance with the public
land transportation development plans and programs approved by the l. To coordinate and cooperate with other government agencies and
Department of Transportation and Communications;
entities concerned with any aspect involving public land transportation
b. To issue, amend, revise, suspend or cancel Certificates of Public services with the end in view of effecting continuing improvement of such
Convenience or permits authorizing the operation of public land services; and

transportation services provided by motorized vehicles, and to prescribe m. To perform such other functions and duties as may be provided by law,
the appropriate terms and conditions therefor;
or as may be necessary, or proper or incidental to the purposes and
objectives of this Executive Order.

c. To determine, prescribe and approve and periodically review and adjust,

reasonable fares, rates and other related charges, relative to the operation Sec. 6. Decision of the Board; Appeals therefrom and/or Review thereof. The
of public land transportation services provided by motorized vehicles;
Board, in the exercise of its powers and functions, shall sit and render its decisions
d. To issue preliminary or permanent injunction, whether prohibitory or en banc. Every such decision, order, or resolution of the Board must bear the
mandatory, in all cases in which it has jurisdiction, and in which cases the concurrence and signature of at least two (2) members thereof.

pertinent provisions of the Rules of Court shall apply;

The decision, order or resolution of the Board shall be appealable to the Secretary
within thirty (30) days from receipt of the decision: Provided, That the Secretary
e. To punish for contempt of the Board, both direct and indirect, in may motu proprio review any decision or action of the Board before the same
accordance with the pertinent provisions of, and the penalties prescribed becomes final.

by, the Rules of Court;

f. To issue subpoena and subpoena duces tecum and summon witnesses Sec. 7. Creation of Regional Franchising and Regulatory Offices. There shall be a
to appear in any proceedings of the Board, to administer oaths and Regional Franchising and Regulatory Office in each of the administrative regions of
affirmations;
the country which shall be headed by a Board Regional Manager having the rank,
g. To conduct investigations and hearings of complaints for violation of the salary and privileges of a Department Assistant Regional Director. The Regional
public service laws on land transportation and of the Board's rules and Franchising and Regulatory Offices shall hear and decide uncontested applications/
regulations, orders, decisions and/or rulings and to impose fines and/or petitions for routes, within their respective administrative regions: Provided, That
penalties for such violations;
applications/petitions for routes extending their respective territorial jurisdictions
h. To review motu proprio the decisions/actions of the Regional shall be heard and decided by the Board.

Franchising and Regulatory Office herein created;

Sec. 8. Appeals. The decisions, orders or resolutions of the Regional Franchising

i. To promulgate rules and regulations governing proceedings before the and Regulatory Offices shall be appealable to the Board within thirty (30) days from
Board and the Regional Franchising and Regulatory Office: Provided, That receipt of the decision.

except with respect to paragraphs d, e, f and g hereof, the rules of

procedure and evidence prevailing in the courts of laws should not be Sec. 9. Appropriations. Funds needed to carry out the provisions of this Executive
controlling and it is the spirit and intention of said rules that the Board and Order shall be taken from the funds available in the Department of Transportation
the Regional Franchising and Regulatory Offices shall use every and all and Communications. Thereafter, the approved budget of the Board shall be
reasonable means to ascertain facts in its case speedily and objectively included in the General Appropriations Act.

and without regard to technicalities of law and procedures, all in the

interest of due process;
Sec. 10. Effectivity. This Executive Order shall take effect immediately.

j. To fix, impose and collect, and periodically review and adjust, reasonable
fees and other related charges for services rendered;

EXECUTIVE ORDER NO. 125 January 30, 1987

k. To formulate, promulgate, administer, implement and enforce rules and

regulations on land transportation public utilities, standards of
measurements and/or design, and rules and regulations requiring
operators of any public land transportation service to equip, install and
provide in their utilities and in their stations such devices, equipment
facilities and operating procedures and techniques as may promote safety,
protection, comfort and convenience to persons and property in their
R E O R G A N I Z I N G T H E M I N I S T R Y O F T R A N S P O R TAT I O N A N D
COMMUNICATIONS DEFINING ITS POWERS AND FUNCTIONS AND FOR
OTHER PURPOSES.
RECALLING that the reorganization of the government is mandated expressly in
Article II, Section 1 (a), and Article III of the Freedom Constitution;

charges as well as the safety of persons and property within their areas of
operations;

HAVING IN MIND that pursuant to Executive Order No. 5 (1986), it is directed that
necessary and proper changes in the organizational and functional structures of the
government, its agencies and instrumentalities, be effected in order to promote
efficiency and effectiveness in the delivery of public services;
service, and cost effectiveness;
(b) Guide government and private investment in the development of the
country's intermodal transportation and communications systems in a
most practical, expeditious, and orderly fashion for maximum safety,

CONSIDERING that viable and dependable transportation and communications (c) Impose appropriate measures to that technical, economic and other
networks are necessary tools for economic recovery;
conditions for the continuing economic viability of the transportation and
communications entities are not jeopardized and do not encourage
CONSIDERING further that rapid technological advances in communication inefficiency and distortion of traffic patronage;

facilities require a distinct response to the peculiar problems of this field;

(d) Develop an integrated plan for a nationwide transmission system in

REALIZING that the growing complexity of the transportation sector has accordance with national and international telecommunications service
necessitated its division into various sub-sectors to facilitate the regulation and requirements including, among others, radio and television broadcast
promotion of the sector as a whole; and
relaying, leased channel services and data transmission;

REALIZING further that the State needs to regulate these networks and promote
their continuous upgrading in order to preserve their viability and enhance their (e) Guide government and private investments in the establishment,
dependability;
operation and maintenance of an international switching system for
incoming and outgoing telecommunications services;

NOW, THEREFORE, I, CORAZON C. AQUINO, President of the Philippines, by

virtue of the powers vested in me by the sovereign will of the Filipino people and (f) Encourage the development of a domestic telecommunications industry
the Freedom Constitution, do hereby order:
in coordination with the concerned entities particularly, the manufacture of
communications/electronics equipment and components to complete and
Sec. 1. Title. This Executive Order shall otherwise be known as the Reorganization support, as much as possible, the expansion, development, operation and
Act of the Ministry of Transportation and Communications.
maintenance of the nationwide telecommunications network;

Sec. 2. Reorganization. The Ministry of Transportation and Communications is (g) Provide for a safe, reliable and efficient postal system for the country.

hereby reorganized, structurally and functionally, in accordance with the provisions

of this Executive Order.
Sec. 5. Powers and Functions. To accomplish its mandate, the Ministry shall have
the following powers and functions:

Sec. 3. Declaration of Policy. The State is committed to the maintenance and

expansion of viable, efficient and dependable transportation and communications (a) Formulate and recommend national policies and guidelines for the
systems as effective instruments for national recovery and economic progress. It preparation and implementation of integrated and comprehensive
shall not complete as a matter of policy with private enterprise and shall operate transportation and communications systems at the national, regional and
transportation and communications facilities only in those areas where private local levels;

initiatives are inadequate or non-existent.

(b) Establish and administer comprehensive and integrated programs for

Sec. 4. Mandate. The Ministry shall be the primary policy, planning, programming,
coordinating, implementing, regulating and administrative entity of the Executive
Branch of the government in the promotion, development and regulation of
dependable and coordinated networks of transportation and communication
systems as well as in the fast, safe, efficient and reliable postal, transportation and
transportation and communications, and for this purpose, may call on any
agency, corporation, or organization, whether public or private, whose
development programs include transportation and communications as an
integral part thereof, to participate and assist in the preparation and
implementation of such programs;

communications services.

(c) Assess, review and provide direction to transportation and

To accomplish such mandate, the Ministry shall have the following objectives:
communications research and development programs of the government
in coordination with other institutions concerned;

(a) Promote the development of dependable and coordinated networks of

transportation and communications systems;
(d) Administer all laws, rules and regulations in the field of transportation
and communications;

 (f) Visayas Regional Offices;

(e) Coordinate with the Ministry of Public Works and Highways in the (g) Mindanao Regional Offices.

design, development, rehabilitation, improvement, construction,

maintenance and repair of telecommunications, ports, airports and Sec. 10. Structural organization. The Ministry, side from the Minister Proper which is
railways projects and facilities including navigational aids and implement comprised of the Offices of the Minister, Deputy and Assistant Ministers, shall be
its development works through competitive bidding, negotiated contracts composed of the Bureaus and Ministry Regional Offices.

of other methods as the President may authorize;

There shall be four (4) Bureaus, namely: Bureau of Land Transportation, Bureau of
(f) Establish operate and maintain a nationwide postal system that shall Air Transportation, Bureau of Posts, and Bureau of Telecommunications.

include mail processing, delivery services, and money order services and
promote the art of philately;
The Office of the Minister shall have direct line supervision and control over the
Bureaus and Ministry Regional Offices. The Ministry Proper shall be responsible for
(g) Sub-allocate series of frequencies of bands allocated by the developing and implementing policies, plans, programs and projects for the
International Telecommunications Union to the specific services;
Ministry.

(h) Accredit foreign aircraft manufacturer and/or international organizations The Bureaus shall be essentially staff in character.

for aircraft certification in accordance with procedures and standards

established by the Bureau of Air Transportation;
Sec. 11. Ministry Regional Offices. The Ministry shall have two (2) Ministry Regional
Offices in each of the administrative regions of the country: The Ministry Regional
(i) Deputize the Philippine Airlines and/or the Airline Pilots Association of Office for Transportation and the Ministry Regional Office for Communications. The
the Philippines for licensing of pilots in accordance with rules, procedures present Regional Offices of the Bureau of Air Transportation and Land
and standards established by the Bureau of Air Transportation;
Transportation Commission are hereby abolished and their functions are transferred
to the respective Ministry Regional Offices for Transportation. A Ministry Regional
(j) Perform such other powers and functions as may be prescribed by law.
Office for Transportation shall be headed by a Ministry Regional Director assisted
by two (2) Assistant Ministry Regional Directors responsible for air and land affairs,
Sec. 6. Authority and Responsibility. The authority and responsibility for the respectively. The present Regional Offices of the Bureau of Posts and Bureau of
exercise of the mandate of the Ministry and for the discharge of its powers and Telecommunications are hereby abolished and their functions are transferred to
functions shall be vested in the Minister of Transportation and Communications, respective Ministry Regional Office for Communications. A Ministry Regional Office
hereinafter referred to as the Minister, who shall have supervision and control over for Communications shall be headed by a Ministry Regional Director assisted by
the Ministry and shall be appointed by the President.
two (2) Assistant Ministry Regional Directors for telecommunications and postal
services, respectively. The abolition of the herein Regional Offices and the transfer
Sec. 7. Office of the Minister. The Office of the Minister shall consist of the Minister of their functions shall be governed by the provisions of Section 19 (b) hereof.

and his immediate staff.

The Ministry Regional Offices shall be under the direct supervision of the Deputy
Sec. 8. Deputy Ministers. The Minister shall be assisted by four (4) Deputy Ministers Minister for Regional Offices. The Ministry Regional Offices shall be essentially line
appointed by the President upon the recommendation of the Minister, one to be in character and shall be responsible for the delivery of all front line Services of the
responsible for Attached Agencies and Corporations, one for Transportation, one Ministry.

for Communications and one for Ministry Regional Offices.

For such purposes, a Ministry Regional Office shall have, within its administrative
Sec. 9. Assistant Ministers. The Minister shall also be assisted by seven (7) region, the following functions:

Assistant Ministers appointed by the President upon the recommendation of the

Minister, each of whom shall head each of the following:
(a) Implement laws, and policies, plans, programs, projects, rules and
regulations of the Ministry;

(a) Administrative and Legal Service;

(b) Provide efficient, and effective service to the people;

(b) Finance and Management Service;

(c) Coordinate with regional offices of other ministries, offices and
(c) Planning and Research Service;
agencies;

(d) Technical Service;

(d) Coordinate with local government units;

(e) Luzon Regional Offices;

(e) Perform such other functions as may be provided by law.

Sec. 12. Bureau of Air Transportation. The Bureau of Air Transportation, as (d) Establish and prescribe rules and regulations for the issuance of license
reorganized herein, shall have the functions of developing, formulating and to qualified motor vehicle drivers, trimobile drivers, motor vehicle
recommending plans, policies, programs, projects, standards, specifications and conductors, train engineers and train conductors;

guidelines related to air transportation including air space utilization, air traffic
control and aeronautics communications and information services, aircraft and air (e) Establish and prescribe the corresponding rules and regulations for the
navigational facilities, services, maintenance and operations. For such purposes, it enforcement of laws governing land transportation, including the penalties
shall, with the approval of the Minister:
for violation thereof, and for the deputization of appropriate law
enforcement agencies in pursuance thereof;

(a) Establish and prescribe rules and regulations for the inspection and
registration of aircrafts;
(f) Determine, fix and/or prescribe charges and/or rates pertinent to the
operation of public and land utility facilities and services except in cases
(b) Establish and prescribe rules and regulations for the issuance of license where charges or rates are established by international bodies or
to qualified airmen;
associations of which the Philippines is a participating member or by
bodies or associations recognized by the Philippine Government as the
(c) Establish and prescribe rules and regulations for the enforcement of proper arbiter of such charges or rates;

laws governing air transportation, including the penalties for violations

thereof, and for the deputization of appropriate law enforcement agencies (g) Establish and prescribe the rules, regulations, procedure and standards
in pursuance thereof;
for the accreditation of driving schools;

(d) Determine, fix and/or prescribe charges and/or rates pertinent to the (h) Perform such other functions as may be provided by law.

operation of public air utility facilities and services except in cases where
charges or rates are established by international bodies or associations of Sec. 14. Maritime Industry Authority. The Maritime Industry Authority is hereby
which the Philippines is a participating member or by bodies or retained and shall have the following functions:

associations recognized by the Philippine Government as the proper

arbiter of such charges or rates;
(a) Develop and formulate, plans, policies, programs, projects, standards,
specifications and guidelines geared toward the promotion and
(e) Administer and operate the Civil Aeronautics Training Center;
development of the maritime industry, the growth and effective regulation
of shipping enterprises, and for the national security objectives of the
(f) Perform such other functions as may be provided by law.
country;

Sec. 13. Bureau of Land Transportation. The Bureau of Land Transportation is (b) Establish, prescribe and regulate routes, zones and/or areas of
hereby created and shall have the functions of developing, formulating and operation of particular operators of public water services;

recommending plans, programs, policies, standards, specifications and guidelines

pertaining to land transportation. For such purposes, it shall, with the approval of (c) Issue Certificates of Public Convenience for the operation of domestic
the Minister:
and overseas water carriers;

(a) Establish and prescribe rules and regulations for routes, zones and/or (d) Register vessels as well as issue certificates, licenses or documents
areas of operations of particular operators of public land services;
necessary or incident thereto;

(b) Establish and prescribe rules and regulations for the issuance of (e) Undertake the safety regulatory functions pertaining to vessel
certificates of public convenience for the operation of public and land construction and operation including the determination of manning levels
transportation utilities and services such as motor vehicles, trimobiles, and and issuance of certificates of competency to seamen;

railroad lines;

(c) Establish and prescribe rules and regulations for the inspection and
registration of public and land transportation facilities such as motor
vehicles, trimobiles and railroad lines:
agencies;
(f) Enforce laws, prescribe and enforce rules and regulations, including
penalties for violation thereof, governing water transportation and the
Philippine Merchant Marine with the aid of other law enforcement

 Sec. 16. Bureau of Posts. The Bureau of Posts, presently existing, shall have the
(g) Undertake the issuance of licenses to qualified seamen and harbor, bay functions of developing, formulating and recommending plans, policies, programs,
and river pilots;
standards, specifications and guidelines to provide safe, fast, reliable and efficient
postal service in the country. For such purposes, it shall, with the approval of the
(h) Determine, fix and/or prescribed charges and/or rates pertinent to the Minister:

operation of public water transport utilities, facilitate all services except in

cases where charges or rates are established by international bodies or
associations of which the Philippines is a participating member or by
bodies or associations recognized by the Philippine Government as the
proper arbiter if such charges or rates;
pursuance thereof;
(a) Establish and prescribe rules and regulations for the enforcement of
laws governing postal services, including the penalties for violation thereof
and for the deputization of appropriate law enforcement agencies in

(i) Accredit marine surveyors and maritime enterprises engaged in (b) Determine, fix, and/or prescribe charges and/or rates for postal
shipbuilding, shiprepair, shipbreaking, domestic and overseas shipping, services except in cases where charges or rates are established by
ship management and agency;
international bodies or associations of which the Philippines is a
participating member or by bodies of associations recognized by the
(j) Supervise the Philippine Merchant Marine Academy as reorganized Philippine Government as the proper arbiter of such charges or rates;

herein in accordance with its charter, the provisions hereof and applicable
laws, rules and regulations under the chairmanship of the maritime (c) Establish and prescribe rules and regulations for the operation and
administrator;
maintenance of a nationwide postal system that shall include mail
processing, delivery services and money order services, and the
(k) Issue and register the continuous Discharge Book of Pilipino Seamen;
promotion of philately;

(l) Establish and prescribes rules and regulations, standards and (d) Perform such other functions as may be provided by law.

procedures for the efficient and effective discharge of the above functions;

Sec. 17. Abolition/Transfer/Consolidation.

(m) Perform such other functions as may now or hereafter be provided by

law.
(a) The Land Transportation Commission is hereby abolished and its staff
functions are transferred to the Bureau of Land Transportation as provided
Sec. 15. Bureau of Telecommunications. The Bureau of Telecommunications, as in Section 13 herein and its line functions are transferred to the Ministry
recognized herein, shall develop, formulate and recommend plans, policies, Regional Offices as provided in Section 11 herein. Such transfer of
programs, standards, specifications and guidelines to provide telecommunications functions is subject to the provisions of Section 19 (b) hereof.

facilities, including telecommunications systems for purposes of augmenting limited

or inadequate existing private telecommunications service; provide (b) PNL Leasing Inc. is hereby abolished and its functions are transferred
telecommunications services in areas where no such services are available; and to Philippine National Lines, Inc. subject to the provisions of Section 19 (b)
assist the private sector engaged in telecommunication services. For such hereof.

purposes, it shall, with the approval of the Minister:

(c) The National Aero Manufacturing Inc. and the Philippine Aero Systems,
(a) Establish and prescribe rules and regulations for the operation and Inc. are hereby abolished in accordance with the provisions of Section 19
maintenance of such telecommunications facilities in areas not adequately (a) hereof.

served by the private sector in order to render such domestic and

overseas services that are necessary or proper with due consideration for (d) The Civil Aeronautics Board is hereby transferred from the Ministry as
advances in technology;
an attached agency in accordance with the provisions of Section 19 (a)
hereof.

(b) Administer and operate the Telecommunications Training Institute;

Sec. 18. Attached Agencies and Corporations.

(c) Perform such other functions as may be provided by law.

(a) The following agencies and corporations are attached to the Ministry;
the Philippine National Railways, the Maritime Industry Authority, the
Philippine National Lines, Philippine Aerospace Development Corporation,
 the Metro Manila Transit Corporation, the Office of Transport Cooperatives,
the Philippine Ports Authority, the Philippine Merchant Marine Academy,
the Toll Regulatory Board, the Light Rail Transit Authority, the Transport
Training Center, the Civil Aeronautics Board, the National
Telecommunications Commissions and the Manila International Airport
Authority.
perform their duties and responsibilities and receive the corresponding
(b) An Airport Security Center is hereby created within the Manila
International Airport Authority, to plan, supervise, control, coordinate,
integrate and direct intelligence and operational activities of all police and
military units, security and safety service units, government monitoring
and intelligence units and other security operating units employed by
government entities and/or by private agencies in the Manila International
Airport. The Center is under the direct supervision and control of the MIAA
General Manager. Moreover, the Authority shall be authorized to organize a
Manila International Airport Police Force with all the police powers
necessary to implement the objectives of the Center.
government unit that has exercised them shall include the appropriations,
The exercise of supervision and control by the Airport Security Center
does not include the transfer of appropriation, equipment and personnel to
the said Authority; PROVIDED, that the Airport Security Center may cause
the development of equipment and personnel in such manner it deems
necessary in the discharge of its functions.
laws, rules and regulations. Such personnel shall, in a hold-over capacity,
Sec. 19. Transitory Provisions. In accomplishing the acts, of reorganization herein
prescribed, the following transitory provisions shall be implied with, unless
otherwise provided elsewhere in this Executive Order.
Article III of the Freedom Constitution. Personnel, whose positions are not
(a) The transfer of a government unit shall include the functions,
appropriations, funds, records, equipment, facilities, choses in action,
rights, other assets, and liabilities, if any, of the transferred unit as well as
the personnel thereof, as may be necessary, who shall, in a hold over
capacity, continue to perform their respective duties and responsibilities
and receive the corresponding salaries and benefits unless in the
meantime they are separated from government service pursuant to
Executive Order No. 17 (1986) or Article III of the Freedom Constitution.
Those personnel of the transferred unit whose positions are not included in
the Ministry's new position structure and staffing pattern approved and
prescribed by the Minister or who are not reappointed shall be deemed
separated from the service and shall be entitled to the benefits provided in
the second paragraph of Section 20 hereof.
liabilities of the abolished unit shall be treated in accordance with the
(b) The transfer of functions which results in the abolition of the
government unit that has exercised them shall include the appropriations,
funds, records, equipment, facilities, choses in action, rights, other assets
and personnel as may be necessary to the proper discharge of the
transferred functions. The abolished unit's remaining appropriations and
funds, if any, shall revert to the General Fund and its remaining assets, if
any, shall be allocated to such appropriate units as the Minister shall
determine or shall otherwise be disposed in accordance with the
Government Auditing Code and other pertinent laws, rules and
regulations. Its liabilities, if any, shall likewise be treated in accordance
with the Government Auditing Code and other pertinent laws, rules and
regulations. Its personnel shall, in a hold-over capacity, continue to
salaries and benefits unless in the meantime they are separated from the
service pursuant to Executive Order No. 17 (1986) or Article III of the
Freedom Constitution. Its personnel, whose positions are not included in
the Ministry's new position structure and staffing pattern approved and
prescribed by the Minister under Section 20 hereof or who are not
reappointed, shall be deemed separated from the service and shall be
entitled to the benefits provided in the second paragraph of the same
Section 20.
(c) The transfer of functions which does not result in the abolition of the
funds, records, equipment, facilities, choses in action, right, other assets
and personnel as may be necessary to the proper discharge of the
transferred functions. The liabilities, if any, that may have been incurred in
connection with the discharge of the transferred functions, shall be treated
in accordance with the Government Auditing Code and other pertinent
continue to perform their respective duties and responsibilities and receive
the corresponding salaries and benefits unless in the meantime they are
separated from the service pursuant to Executive Order No. 17 (1986) or
included in the Ministry's new position structure and staffing pattern
approved and prescribed by the Minister under Section 20 hereof or who
have not been reappointed, shall be deemed separated from the service
and shall be entitled to the benefits provided in the second paragraph of
the same Section 20.
(d) In case of the abolition of a government unit which does not result in
the transfer of its functions to another unit, the appropriations and funds of
the abolished unit shall revert to the General Fund, while the records,
equipment, facilities, choses in action, rights, and other assets, thereof
shall be allocated to such appropriate units as the Minister shall determine
or shall otherwise be disposed in accordance with the Government
Auditing Code and other pertinent laws, rules and regulations. The
Government Auditing Code and other pertinent laws, rules and
regulations, while the personnel thereof, whose positions are not included
in the Ministry's new position structure and staffing pattern approved and
prescribed by the Minister under Section 20 hereof or who have not been
reappointed, shall be deemed separated from the service and shall be
entitled to the benefits provided in the second paragraph of the same
Section 20.
(e) In case of merger or consolidation of government units, the new or
surviving unit shall exercise the functions (subject to the reorganization
herein prescribed and the laws, rules and regulations pertinent to the
exercise of such functions) and shall acquire the appropriations, funds,
records, equipment, facilities, choses in action, rights, other assets,
liabilities if any, and personnel, as may be necessary, of (1) the units that
compose the merger unit or (2) the absorbed unit, as the case may be.
Such personnel shall, in a hold over capacity, continue to perform their
respective duties responsibilities and receive the corresponding salaries
and benefits unless in the meantime they are separated from the service
pursuant to Executive Order No. 17 (1986) or Article III of the Freedom
Constitution. Any such personnel, whose positions is not included in the
Ministry's new position structure and staffing pattern approved and
prescribed by the Minister under Section 20 hereof or who is not
reappointed, shall be deemed separated from the service and shall be
entitled to the benefits provided in the second paragraph of the same
Section 20.
services.
(f) In case of termination of a function which does not result in the abolition
of the government unit which has performed such function, the
appropriations and funds intended to finance the discharge of such
function shall revert to the General Fund, while the records, equipment,
facilities, choses in action, rights and other assets used in connection with
the discharge of such function shall be allocated to the appropriate units
as the Minister shall determine or shall otherwise be disposed in
accordance with the Governing Auditing Code and other pertinent laws,
rules and regulations. The liabilities, if any, that may have been incurred in
connection with the discharge of such functions shall likewise be treated in
accordance with the Government Auditing Code and other pertinent laws,
rules and regulations. The personnel who have performed such function,
whose position are not included in the Ministry's new position structure
and staffing pattern approved and prescribed by the Minister under
Section 20 hereof or who have not been reappointed, shall be deemed
separated from the service and shall be entitled to the benefits provided in
the second paragraph of the same Section 20.
be called Department of Transportation and Communications and the titles of
Sec. 20. New Structure and Pattern. Upon approval of this Executive
Order, the officers (the term "officer" as used in this Executive Order is
intended to be within the meaning of the term "official as used in the
Freedom Constitution) and employees of the Ministry shall, in a hold over
capacity, continue to perform their respective duties and responsibilities
and receive the corresponding salaries and benefits unless in the
meantime they are separated from government service pursuant to
Executive Order No. 17 (1986) or Article III of the Freedom Constitution.
Sec. 27. Repealing Clause. Presidential Decree No. 890 and Letters of Instruction
The new position structure and staffing pattern of the Ministry shall be
approved and prescribed by the Minister, for the Ministry, within one
hundred twenty (120) days from the approval of this Executive Order and
the authorized positions created thereunder shall be filled with regular
appointments by him or by the President as the case may be. Those
incumbents whose positions are not included therein or who are not
reappointed shall be deemed separated from the service. Those separated
from the service shall receive the retirement benefits to which they may be
entitled under existing laws, rules and regulations. Otherwise, they shall be
paid the equivalent of one month basic salary for every year of service, or
the equivalent nearest fraction thereof favorable to them on the basis of
the highest salary received, but in no case shall such payment exceed the
equivalent of 12 months salary.
No court or administrative body shall issue any writ or preliminary
injunction or restraining order to enjoin the separation/replacement of any
officer or employee effected under this Executive Order.
Sec. 21. Prohibition Against Changes. No change in the reorganization herein
prescribed shall be valid except upon prior approval of the President for the
purposes of promoting efficiency and effectiveness in the delivery of public
Sec. 22. Implementing Authority of Minister. The Minister shall issue such orders,
rules, regulations and other issuances as may be necessary to ensure the effective
implementation of the provisions of this Executive Order.
Sec. 23. Notice or Consent Requirements. If any reorganizational change herein
authorized is of such substance or materiality as to prejudice third persons with
rights recognized by law or conduct such that notice to or consent of creditors is
required to be made or obtained pursuant to any agreement entered into with any
of such creditors, such notice or consent requirement shall be complied with prior
to the implementation of such reorganizational change.
Sec. 24. Funding. Funds needed to carry out the provisions of this Executive order
shall be taken from funds available in the Ministry.
Sec. 25. Change of Nomenclature. In the event of the adoption of a new
Constitution which provides for a presidential form of government, the Ministry shall
Minister, Deputy Minister, and Assistant Minister shall be changed to Secretary,
Undersecretary and Assistant Secretary, respectively.
Sec. 26. Separability. Any portion or provision of this Executive Order that may be
declared unconstitutional shall not have the effect of nullifying other portions or
provisions hereof, as long as such remaining portions or provisions can still subsist
and be given effect in their entirety.
Nos. 263 and 371 are hereby repealed. All laws, ordinances, rules, regulations,
other issuances or parts thereof, which are inconsistent with this Executive Order,
are hereby repealed or modified accordingly.
Sec. 28. Effectivity. This Executive Order shall take effect immediately upon its national emergencies; and (e) function as an employment support base for our
approval.
Filipino seafarers.

To attain these objectives, it is hereby declared to the policy of the State to; (a)
promote Filipino ownership of vessels operated under the Philippine flag; (b) attract
private capital to invest in the shipping industry by creating a healthy and
competitive investment and operating environment; (c) provide necessary
assistance and incentives for the continued growth of the Philippine domestic
merchant marine fleet; (d) encourage the improvement and upgrading of the
existing domestic merchant marine fleet and Filipino crew to meet international
standards; (e) ensure the continued viability of domestic shipping operations; and (f)
encourage the development of a viable shipbuilding and ship repair industry to
support the expansion and modernization of the Philippine domestic merchant
marine fleet and its strict adherence to safety standards which will ensure the
seaworthiness of all sea-borne structures.

SEC. 3.  Definition of Terms.  - As used in and for purposes of this Act, the
following terms, whether in singular or plural are hereby defined as follows:

(a) "Domestic shipping" shall mean the transport of passenger or cargo, or

Republic Act No. 9295             May 03, 2004
both, by ships duly registered and licensed under Philippine law to engage
in trade and commerce between Philippine ports and within Philippine
AN ACT PROMOTING THE DEVELOPMENT OF PHILIPPINE DOMESTIC territorial or internal waters, for hire or compensation, with general or
SHIPPING, SHIPBUILDING, SHIP REPAIR AND SHIP BREAKING, ORDAINING limited clientele, whether permanent occasional or incidental, with or
REFORMS IN GOVERNMENT POLICIES TOWARDS SHIPPING IN THE without fixed routes, and done for contractual or commercial purposes;

PHILIPPINES AND FOR OTHER PURPOSES.

(b) "Domestic trade" shall mean the sale, barter or exchange of goods,
Be it enacted by the Senate and House of Representatives of the Philippines in materials or products within the Philippines;

Congress assembled:

(c) "Domestic Ship Operator" or "Domestic Ship Owner" may be used

CHAPTER I
 interchangeably and shall mean a citizen of the Philippines, or a
GENERAL PROVISIONS
commercial partnership wholly owned by Filipinos, or a corporation at
least sixty percent (60%) of the capital of which is owned by Filipinos,
SECTION 1.  Short Title.  - This Act shall be known as the "Domestic Shipping which is duly authorized by the Maritime Industry Authority (MARINA) to
Development Act of 2004."
engage in the business of domestic shipping;

(d) "Shipper" shall mean any person, partnership or corporation who shall
SEC. 2. Declaration of Policy. - The State recognize that shipping is a necessary procure for itself the services of a domestic ship operator for the carriage
infrastructure, which is vital to the economic development of our country.
of its cargo in the domestic trade upon payment of proper compensation;

The Philippines needs a strong and competitive domestic merchant fleet owned (e) "MARINA" shall mean the Maritime Industry Authority;

and controlled by Filipinos or by corporations at least sixty percent (60%) of the

capital of which is owned by Filipinos and manned by qualified Filipino officers and
crew which shall: (a) bridge our islands by ensuring safe, reliable, efficient,
adequate and economic passenger and cargo services; (b) encourage the dispersal
of industry and the economic development of our regional communities by ensuring
the availability of regular, reliable and efficient shipping services; (c) ensure the
(f) "Ship" or "Vessel" may be used interchangeably and shall mean any
kind, class or type of craft or artificial contrivance capable of floating in
water, designed to be used, or capable of being used as a means of water
transport in the domestic trade for the carriage of passengers or cargo, or
both, utilizing its own motive power or that of another;

growth of exports by providing necessary, competitive and economical domestic

sea linkage; (d) serve as a naval and military auxiliary in times of war and other (g) "Importation" shall mean the direct purchase, lease or charter of newly
constructed or previously owned ships, or the purchase of ship's spare
 parts from foreign sources or from registered enterprises operating in SEC. 4.  Investment Incentives.  - To insure the continued viability of domestic
special economic zones as this terms is defined in Republic Act No. 7916 shipping, and to encourage investments in the domestic shipping industry, the
entitled, "The Special Economic Zone Act of 1995,"
following incentives shall be granted to qualified domestic ship operators:

(h) "Spare parts" shall mean the replacement parts or components of
vessel, including but not limited to its hull, engines, machineries,
equipment, appurtenances, necessaries accessories, article, supplies,
materials, steelplates, aluminum plates, other metal plates,
communications, equipment, and other parts or components thereof,
installed abroad the ships necessary for its safe and efficient navigation
and operation;
limit is fifteen (15) years old, 2) For tankers, the age limit is ten (10) years
(i) "Certificate of Public Convenience' shall mean the license on authority
(a) Exemption from value-added tax on the importation and local purchase
of passenger and/or cargo vessels of one hundred fifty (150) tons and
above, including engine and spare parts of said vessels: Provided: That
the vessels to be imported shall comply with the age limit requirement at
the time of acquisition counted from the date of the vessels, original
commissioning, as follows; 1) For passenger and/or cargo vessels, the age
old, and 3) For high-speed passenger crafts, the age limit is five (5) years
old; and

issued by MARINA to a domestic ship operator to engage in domestic

shipping;
(b) Exemption from value-added tax on the importation of life saving
equipment , safety and rescue equipment and communication and
(j) "Cargo handling equipment' shall mean any machinery, gear or navigational safety equipment, steel plates and other metal plates
equipment used by the ship operator or a duly authorized and licensed including marine-grade aluminum plates, used for transport operations.

port operator to service or handle cargo, on board the vessel at the port or
in the terminal or container yard such as, but not limited to cranes, The importation of the articles under Section 4(a) and (b) of the Act shall
forklifts, top lifts, stackers, tractor heads, containers, pallet boards and the be granted exemption from value-added tax subject to the following
like, including all spare parts, replacement parts, appurtenances conditions: (1) That said articles are not manufactured domestically in
accessories, articles, supplies and materials thereof;
sufficient quantity, of comparable quality and at reasonable prices; (2) That
said articles are directly imported by a MARINA-registered domestic
(k) "Shipbuilding" shall mean the design, construction, launching and shipping operator; (3) That said articles are reasonably-needed and will be
outfitting of all types of ships and watercraft;
used exclusively by the registered domestic shipping operator in its
transport operations; (4) That the approval of MARINA was obtained prior
(l) "Ship repair" shall mean the overhaul, refurbishment renovation to the importation of said articles; and (5) That exemption from value-
improvement, or alteration of the hull, machineries, equipment, outfits and added tax on the importation of said articles shall be granted to all
components of all types of ships;
domestic shipping operators within a period of ten (10) years from the
effectivity of this Act.

(m) "Shipyard" shall mean the shipbuilding or repair facilities which have
the capability to lift vessels above the waterline in order to effect ship work Any sale, transfer or disposition of articles covered under Section 4 (a) and
on vessels, appendages, structure, machinery and equipment; and
(b) within ten (10) years from the effectivity of this Act to another registered
shipping operator enjoying similar incentive shall require prior approval of
(n) "Shipbuilder" or "Ship repairer" shall mean a citizen of the Philippines, MARINA. If the sale, transfer or disposition was made without prior
or a commercial partnership owned by majority of Filipinos or a approval of MARINA, both the vendor and the transferee or assignee shall
corporation incorporated under the laws of the Philippines, the capital of be liable to pay twice the amount of value-added tax exemption given him:
which is owned or controlled in any proportion by Filipinos or by foreign Provided, further, That if the sale transfer or disposition was made to
nationals, or by both such Filipinos or foreign nationals, or by corporations nonexempt entity or to a party other than a registered domestic ship
whether Filipino or foreign-owned, which is duly authorized by the operator within ten (10) years from the effectivity of this Act, both the
MARINA to engage in the business of shipbuilding or ship repair or to vendor and the transferee or assignee shall be solidarily liable to pay twice
otherwise operate a shipyard, graving dock or marine repair yard.
the amount of the value-added tax waived: Provided, finally. That the sale,
transfer or disposition made after ten (10) years from the effectivity of this
Act shall be made by informing MARINA in writing. The purchasers,
transferees, or recipients shall be considered the importers thereof, who
CHAPTER II
 shall be liable for any internal revenue tax on such importation. The tax
INVESTMENT INCENTIVES
due on such importation shall constitute a lien on the article itself, and
such lien shall be superior to all charges or liens on the goods, irrespective
 of the possessor thereof. The Bureau of Internal Revenue (BIR) shall be intend to operate in a fixed route shall nevertheless state in its application the
furnished with notice of actions taken by the MARINA.
service it proposes to offer.

(c) Net operating loss carry over. A net operating loss in any taxable year
immediately preceding the current taxable year, which had not been
previously offset as a deduction from gross income shall be carried over
for the next three (3) consecutive taxable years immediately following the
year of such loss subject to the pertinent provisions of the National
SEC. 8. Deregulation of the Domestic Shipping Industry. - In order to encourage
investments in the domestic shipping industry by existing domestic ship operators
and attract new investment from new operators and investors, domestic ship
operators are hereby authorized to establish their own domestic shipping rates:
Provided, That effective competition is fostered and public interest is served.

Internal Revenue Code of 1997, as amended.

The MARINA shall monitor all shipping operations and exercise regulatory
intervention where it is established after due process that public interest needs to
(d) Accelerated depreciation. Fixed assets my be depreciated as follows:
be protected and safeguarded.

(i) To the extent of not more than twice as fast as the normal rate SEC. 9. Safety Standards. - All vessels operate by domestic ship operators shall
of depreciation or depreciated at normal rate of depreciation if the at all times be in seaworthy condition properly equipped with adequate life-saving,
expected life is ten (100 years or less; or
communication, safety and other equipment operated and maintained in
accordance with the standards set by MARINA, and manned by duly licensed and
(ii) Depreciation over any number of years between five (5) years competent vessel crew.

and the expected life if the latter is more than ten (10) years, and
the depreciation thereon allowed as deduction from taxable The MARINA shall have the power to inspect vessels and all equipment on board to
Income: Provided, That the domestic shipping operator notifies ensure compliance with safety standards.

the BIR at the beginning of the depreciation period which

depreciation rate allowed by this section will be used.
SEC. 10. Jurisdiction; Power; and Duties of MARINA. - The MARINA shall have
the power and authority to:

CHAPTER III

DEREGULATION OF THE DOMESTIC SHIPPING INDUSTRY-AUTHORITY 
 (1) Register vessels;

OF THE MARITIME INDUSTRY AUTHORITY

(2) Issue certificates of public convenience or any extensions or amendments
thereto, authorizing the operation of all kinds. Classes and types of vessels in
SEC. 5.  Authority to Operate.  - No franchise, certificate or any other form domestic shipping: Provided, That no such certificate shall be valid for a
authorization for the carriage of cargo or passenger, or both in the domestic trade, period of more than twenty-five (25) years;

shall be granted except of domestic ship owners or operators.

(3) Modify, suspend or revoke at any time upon notice and hearing, any
SEC. 6.  Foreign Vessels Engaged in Trade and Commerce in the Philippines certificate, license or accreditation it may have issued to any domestic ship
Territorial Waters. - No foreign vessel shall be allowed to transport passengers or operator;

cargo between ports or place within the Philippine territorial waters, except upon
the grant Special Permit by the MARINA when no domestic vessels is available or (4) Establish and prescribe routes, zones or areas of operations of domestic
suitable to provide the needed shipping service and public interest warrants the ship operators;

same.

(5) Require any domestic ship operator to provide shipping services to any
SEC. 7. Issuance of Authority to operate. - the MARINA shall have the power and coastal area, island or region in the country where such services are
authority to issue certificates of public convenience to qualified domestic ship necessary for the development of the area, to meet emergency sealift
operators, taking into consideration the economic and beneficial effect which the requirements, or when public interest so requires;

proposed services shall have to the port province or region which it proposes to
serve, and the financial capacity of the domestic ship operator to provide and (6) Set safety standards for vessels in accordance with applicable conventions
sustain safe, reliable, adequate, efficient and economic service in accordance with and regulations;

the standards set by the government regulation.

(7) Require all domestic ship operators to comply with operational and safety
Every domestic ship operator shall state in its application the route it proposes to standards for vessels set by applicable conventions and regulations, maintain
serve, and the service it proposes to offer. Domestic ship operators who do not its vessels in safe and serviceable conditions, meet the standards of safety of
 life at sea and safe manning requirements, and furnish safe, adequate, SEC. 12.  Government Cargo.  - Every domestic ship operator shall have the
efficient, reliable and proper service at all times;
obligation to carry mail on mutually agreed terms and conditions and preferential,
negotiated conditions shall be given for the carriage of other government cargo.

(8) Inspect all vessels to ensure and enforce compliance with safety standards
and other regulations;
SEC. 13. Monopolized Routes. - The MARINA shall have the authority to draw up
such rules and regulations necessary for service in monopolized routes to
(9) Ensure that all domestic ship operators shall have the financial capacity to determine the fairness of passenger and cargo rates needed to sustain the service
provide and sustain safe, reliable, efficient and economic passenger or cargo taking into consideration the economic and beneficial effect which the service shall
service, or both;
have to the port, province, island or region it proposes to serve, the volume of
passengers and cargo available, the level and quality of service offered by the ship
(10) Determine the impact which any new service shall have to the locality it operator, and the available port facilities and terminal handling services.

will serve;

CHAPTER V

(11) Adopt and enforce such rules and regulations which will ensure COMPULSORY INSURANCE COVERAGE

compliance by every domestic ship operator with required safety standards

and other rules and regulations on vessel safety;
SEC. 14. Compulsory Insurance Coverage for Passenger and Cargo. - To meet
its financial responsibility for any liability which a domestic ship operator may incur
(12) Adopt such rules and regulations which ensure the reasonable stability of for any breach of the contract of carriage, every domestic ship operator shall be
passengers and freight rates and, if necessary, to intervene in order to protect required to submit annually the following;

public interest;

(1) Adequate insurance coverage for each passenger in an amount to be

(13) Hear and adjudicate any complaint made in writing involving any violation computer in accordance with existing laws, rules and regulations, and the
of this law or the rules and regulations of the Authority;
total amount of such coverage shall be equivalent to the total number of
passenger accommodations being offered by the vessel;

(14) Impose such fines and penalties on, including the revocations of licenses
of any domestic ship operator who shall fail to maintain its vessels in safe and (2) Adequate insurance coverage for cargo in an amount to be computed
serviceable condition, or who shall violate or fail to comply with safety in accordance with existing laws, rules and regulations, and the total
regulations;
amount of such coverage shall be equivalent to the total cargo capacity
being offered by the vessel; and

(15) Investigate any complaint made in writing against any domestic ship
operator, or any shipper, or any group of shippers regarding any matter (3) If a domestic ship operator should offer both passenger and cargo
involving violations of the provisions of this Act;
service, then the total insurance coverage shall be in the total sum
equivalent to that stipulated in paragraphs (1) and (2) of this section.
(16) Upon notice and hearing, impose such fines, suspend or revoke Provided, That if a domestic ship operator should operate more than one
certificates of public convenience or other license issued, or otherwise (1) vessels, the amount of insurance coverage required under this section,
penalize any ship operator, shipper or group of shippers found violating the for purposes of providing financial capacity, shall be the amount equivalent
provisions of this Act; and
to the total number of passenger accommodations, or total cargo
capacity, or both, of the largest operating vessel which the domestic ship
(17) Issue such rules and regulations necessary to implement the provisions of operator may have: Provided, further, That the total insurance coverage
this Act: Provided, That such rules and regulations cannot change or in any which may be required of any domestic ship operator shall not exceed the
way amend or be contrary to the intent and purposes of this Act.
value of such vessel: Provided, finally, that adequate insurance coverage
CHAPTER IV
 shall be obtained from any duly licensed insurance company or
RATES
international protection and indemnity association.

SEC. 11. Rates. - Every domestic ship operator shall have the right to fix its own SEC. 15.  Other Insurance Coverage.  - the MARINA shall have the power to
passenger pr cargo rates, or both.
require every ship operator to obtain such other compulsory insurance coverage
necessary to adequately cover claims for damages.

CHAPTER VI
 (1) Suspend or revoke any certificate of public convenience, license,
PROHIBITED ACT AND PRACTICES
permit, accreditation, or other form of authority issued to any domestic
ship operator who shall violate any provision of this Act or any rules and
SEC. 16.  Prohibited Acts and Practices of Domestic Ship Operators.  - the regulations issued pursuant thereto, or any condition impose on such
MARINA shall have the power to impose such fines and penalties against every certificate of public convenience, license, permit or accreditation;

domestic ship operator who shall:

(2) Impose a fine on a domestic ship operator who shall operate without a
(1) Operate without a valid certificate of public convenience, accreditation valid certificate of public convenience, license, permit, accreditation or
or other form of authority required by this Act;
other form of authority;

(2) Refuse to accept or carry any passenger or cargo without just cause;
(3) Impose a fine on a domestic ship operator in an amount to be
determined by the MARINA for refusing to accept, or to carry passengers
(3) Fail to maintain its vessels in safe and serviceable condition, or violate or cargo, without just cause, or for engaging in any prejudicial,
safety rules and regulations;
discriminatory or disadvantageous act towards any class of passengers or
shippers;

(4) Fail to obtain or maintain adequate insurance coverage;

(4) Impose a fine on any domestic ship operator in an amount to be

(5) Fail to meet or maintain safe manning requirements; and
determined by the MARINA, or suspend or revoke the certificate of public
convenience of such domestic ship operator, or both, who shall fail to
(6) Such other acts which the MARINA shall determine, after due notice meet the standards of such safety or who refuses to comply with or
and hearing, to be detrimental or prejudice to the safety, stability and violates safety regulations imposed by the MARINA or fails to maintain its
integrity of domestic shipping.
vessels in safe and serviceable condition;

(5) Impose a fine on any domestic ship operator in an amount to be

CHAPTER VII
 determined by the MARINA, or impose such other penalty, including the
FEE, FINES AND PENALTIES
revocation of any certificate or license, who fails to procure or renew
required insurance policies;

SEC. 17.  Fees.  - The MARINA shall have the power to impose, fix, collect and
receive, in accordance with the schedules approved by its Board, such fees
necessary for the licensing, supervision, regulation, inspection, approval and
accreditation of domestic ship operators and the promotion and development of
the country's maritime industry. The MARINA shall have the power to establish and
(6) Impose a fine on any domestic ship operator in an amount to be
determined by the MARINA or impose such other penalty, including the
revocation of any certificate or license who fails to meet or maintain safe
manning requirements; and

manage a trust fund for this purpose.

(7) Impose such other fines and penalties the MARINA may deem
Fees prescribed by the MARINA under this section shall be imposed and collected necessary and appropriate in order to enforce the provision of this Act.

in order to recover the cost for rendering the service and shall not be used in order
to impose a penalty on the domestic ship operator. Excessive fees, multiple fees CHAPTER VIII

and duplicative fees shall at all times be avoided.
SHIPBUILDING

The supervision fee provided in Section 40(e) of Commonwealth Act No. 146 Sec. 19.  Shipbuilding and Ship Repair Investment Incentives.  - To encourage
insofar as the same applies to the operation, management, control and regulation investments and to and ensure the development of a viable shipbuilding and ship
of vessels, steamboats, steamship lines, ferries, water craft and the like, is hereby repair industry, the following incentives are hereby granted:

repealed.

(a) Exemption from value-added tax on the importation of capital

SEC. 18.  Fines and Penalties.  - The MARINA, upon notice and hearing and a equipment, machinery, spare parts, life-savings ang navigational
determination of the existence of any breach or violation of the provisions of this equipment, steel plates and other metal plates including marine -grade
Act or any rules and regulations issued pursuant thereto, shall have the power and aluminum plates to be used in the construction, repair, renovation or
authority to:
alteration or any merchant marine vessel operated or to be operated in the
domestic trade.

The importation of the above articles shall be granted exemption from
value-added tax subject to the following conditions: (1) That said articles
are not manufactured domestically in sufficient quantity, of comparable
quality and at reasonable prices; (2) That said articles are directly imported
by a MARINA-registered shipbuilders and ship repairer; (3) That said
articles are reasonably needed and will be used exclusively by the
registered shipbuilders and ship repairer; (4) That the approval of MARINA
was obtained prior to the importation of said articles ; and (5) That
shipbuilders and ship repairers may avail of the exemption from value-
added tax provided herein within a period of ten (10) years from the
approval of this Act.
evaluation, the capability of MARINA-registered shipyards to build classed vessels
Any sale, transfer or disposition of articles under Section 19 (a) within ten
(10) years from the effectivity of this Act to another registered shipbuilder
or repairer enjoying similar incentive shall require prior approval of
MARINA. If the sale, transfer or disposition was made without prior
approval of MARINA, both the vendor and the transferee or assignee shall
be liable to pay twice the amount of the value-added tax exempt given
him: Provided, further, That if the sale, tranfer or disposition was made to a
nonexempt entity or to a party other than that a registered shipbuilder or
repairer within ten (10) years from the effectivity of this Act, both the
vendor and the transferee or assignee shall be solidarily liable to pay twice
the amount of the value-added tax waived; Provided, finally, That the sale,
transfer or disposition made after ten (10) years from the effectivity of this
Act shall be made by Informing MARINA in writing. The purchaser,
transferees or recipients shall be considered the Importers thereof, who
shall be liable for any internal revenue tax on such importation. The tax
due on such importation shall constitute a lien on the foods superior to all
changes or liens on the goods, irrespective of the possessor thereof. The
BIR shall be furnished with notice of actions taken by the MARINA.
SEC. 22.  Classification of Vessels in the Domestic Trade.  - A vessels, whether
(b) Net operating loss carry-over. A net operating loss in any taxable year
immediately preceding the current taxable year, which had not been
previously offset as a deduction from gross income shall be carried over
as a deduction from gross income for the next three (3) consecutive
taxable years immediately following the year of such loss subject to the
pertinent provisions of the National Internal Revenue Code of 1997, as
amemded;
government-recognized classification society.
(c) Accelerated depreciation. Fixed assets may be depreciated as follow:
mandatory vessel retirement program and which do not carry a class certificate
(i) To the extent of not more than twice as fast as the normal rate
of depreciation or depreciated at normal rate of depreciation if the
expected life is ten (10) years or less; or
Philippine Registry.
(ii) Depreciated over any number of years between five (5) years
and the expected life if the latter is more than ten (10) years, and
the depreciation thereon allowed as deduction from taxable
income. Provided, That the registered shipbuilder and ship
repairer notifies the BIR at the beginning of the depreciation
period which depreciation rate allowed by this section will be
used.
SEC. 20.  Restrictions on Vessel Importation.  - Ten (10) years from the effective
date of this Act and every year thereafter, the MARINA shall evaluate and determine
the progressive capability of MARINA- registered shipyards to build and construct
new vessels for the domestic trade.
In the first year of evaluation, the MARINA shall determine the capability of
MARINA-registered shipyards to build new vessels below 500 GRT. If, upon
below 500 GRT in quantities sufficient to meet domestic demand is proven, then all
domestic ship operators shall be discouraged from importing new or previously
owned vessels that are less than 500 GRT for the domestic trade and vessels built
in MARINA-registered shipyards shall be given priority for entry in the Philippines
Registry and allowed to operate in the domestic trade.
The MARINA shall undertake a yearly evaluation of the progressive capabilities of
all MARINA-registered shipyards to build larger classed vessels for the domestic
trade in quantities sufficient to meet the demand of domestic ship owners and shall
correspondingly adjust the size of vessels which may be sourced from MARINA-
registered shipyards.
CHAPTER IX

TRANSITORY PROVISIONS
SEC. 21.  Period of Transition.  - Upon the approval of this Act existing liner
operators shall continue to operate in their route.
newly built or previously owned, which are acquired or after the effectivity of this
Act shall be classed by a government recognized classification society on the date
of acquisition prior to the operation in the domestic trade.
SEC. 23. Retirement of Old Vessels. - Immediately upon the approved of this Act,
the MARINA shall prepare and implement a mandatory vessel retirement program
for all unclassed vessels that fail to meet the classification standards of a
All vessels which have attained the maximum vessel age stipulate by MARINA's
issued by a government-recognized classification society shall not be allowed to
operate in the domestic trade and shall be automatically de-listed from the
CHAPTER X

FINAL PROVISIONS
SEC. 24. Temporary Take-Over of Operations. - In times of national emergency,
when the public interest so requires, the State may during emergencies and under
reasonable terms prescribed by it, temporary take over or direct the operations or
any vessel engaged in domestic trade and commerce, or prescribe its rates or
routes of operation. Immediately upon the cessation of the emergency, the State
shall immediately reinstate to the domestic ship operation of its vessel under the
same terms and conditions prior to the occurrence of the emergency.

SEC. 25.  Separability Clause.  - If, for any reason, any section, subsection,
sentence, clause or term of this Act is held to be illegal invalid or unconstitutional,
such parts not affected by such declaration shall remain in full force and effect.

SEC. 26.  Repealing Clause.  - The provisions of Commonwealth Act No. 146,
insofar as the same applies to the operation, management control and regulation of
vessels, steamboats, steamships, lines, ferries, water craft and the like, as well as
the provisions of Presidential Decree No. 474, Executive Order Nos. 125 and 125-A, REPUBLIC ACT NO. 10635

and such other laws, presidential decrees, executive orders, issuances, rules and
regulations or parts thereof, which are inconsistent with the provisions of this Act AN ACT ESTABLISHING THE MARITIME INDUSTRY AUTHORITY (MARINA) AS
are hereby repealed, amended or modified accordingly.
THE SINGLE MARITIME ADMINISTRATION RESPONSIBLE FOR THE
IMPLEMENTATION AND ENFORCEMENT OF THE 1978 INTERNATIONAL
SEC. 27. Effectivity. - This Act shall take effect after fifteen (15) days following its CONVENTION ON STANDARDS OF TRAINING, CERTIFICATION AND
publication in at least two (2) newspapers of general circulation.
WATCHKEEPING FOR SEAFARERS, AS AMENDED, AND INTERNATIONAL
AGREEMENTS OR COVENANTS RELATED THERETO

Be it enacted by the Senate and House of Representatives of the Philippines in

Congress assembled:

Section 1.  Declaration of Policy.—The following are hereby declared to be the

policies of the State:

(a) The State shall ensure compliance with the 1978 International
Convention on Standards of Training, Certification and Watchkeeping for
Seafarers (STCW Convention), as amended; all international agreements
implementing or applying the STCW Convention; and other international
maritime safety conventions or agreements that the STCW Convention
seeks to promote compliance with;

(b) The State recognizes the vital contribution of the seafarers to the
national economy. Toward this end, the State shall establish systems and
mechanisms for the promotion and protection of the well-being of the
seafarers to ensure their professionalism and competitiveness, both in
local and international trade, consistent with existing local labor laws and
applicable international laws;

(c) The State shall create a single maritime administrative system and
structure that shall provide an enabling environment for the business of
Philippine seafaring; establish appropriate institutional arrangements with
other agencies of government; and create an effective regulatory
framework conducive to the efficiency, transparency and competitiveness
of the Philippine seafaring industry consistent with the STCW Convention;
and

 (d) The State shall harmonize all legal and administrative measures which out the provisions of this Act, the MARINA shall exercise the following powers and
are taken and provided for by government regulatory agencies and ensure functions:

that such measures are appropriate and consistent with the STCW
Convention.
(a) Act as the single and central maritime administration for all purposes
relating to compliance with the STCW Convention.

Section 2. Definition of Terms.—As used in this Act, the following terms shall mean:

(b) Administer and ensure the effective implementation of the STCW

(a) Certificate of competency—a certificate issued to masters, officers and Convention; including all international conventions or agreements
Global Maritime Distress and Safety System (GMDSS) radio operators in implementing or applying the same, as well as international maritime
accordance with the provisions of Chapters II, III, IV or VII of the Annex to safety conventions or agreements that it seeks to promote compliance
the STCW Convention entitling the lawful holder to serve and perform the with.

functions involved at the level of responsibility specified therein.

(c) Assume all powers and functions of the Professional Regulation

(b)  Certificate of endorsement—an attestation of the maritime Commission (PRC), the Commission on Higher Education (CHED), the
administration as to the authenticity and validity of the certificates, Technical Education and Skills Development Authority (TESDA), the
incorporated in the format of the certificates issued to masters and Department of Health (DOH) and the National Telecommunications
officers, stating that the issuance of the relevant certificate is in Commission (NTC) relative to the issuance, validation, verification,
compliance with the requirements of the STCW Convention.
correction, revocation or cancellation of certificates of competency,
endorsement, proficiency and documentary evidence required of all
(c)  Certificate of proficiency—a certificate other than a certificate of seafarers and all such other matters pertaining to the implementation of
competency issued to a seafarer, stating that the relevant requirements of the STCW Convention, subject to the following:

training competencies or seagoing service under the STCW Convention

have been met.
(1) The MARINA shall ensure that the examination, licensing and
certification system for marine deck and engine officers are in
(d) Documentary evidence—all the documentation, other than a certificate accordance with the requirements prescribed under the STCW
of competency or certificate of proficiency, used to establish that the Convention. All powers, duties and functions of the PRC on
relevant requirements of the STCW Convention have been met.
examination, licensing and certification system for marine deck
(e) Maritime administration or single maritime administration—the Maritime and engine officers as provided in Republic Act No. 8544,
Industry Authority (MARINA), as the single government agency mandated otherwise known as "The Philippine Merchant Marine Officers Act
to ensure complete and effective implementation of the STCW of 1998", shall henceforth be exercised by the MARINA. The
Convention.
compensation and allowances of the Board of Marine Deck
Officers and Marine Engine Officers under Article TV, Section 8 of
(f)  Seafarer—any person who is employed, engaged or works onboard Republic Act No. 8544 shall, however, be comparable to the
seagoing ships, whether or not such ships are engaged in the domestic or compensation and allowances being received by the
overseas trade, and to whom the STCW Convention applies.
chairpersons and members of other existing regulatory boards
under the PRC and as provided in the General Appropriations
(g) STCW Convention—the 1978 International Convention on Standards of Act.

Training, Certification and Watchkeeping for Seafarers, and its subsequent

amendments.
(2) The MARINA shall adopt rules and regulations, in accordance
with the STCW Convention, governing able-bodied deck and
Section 3. MARINA as the Single Maritime Administration.—The MARINA, created engine ratings including:

under Presidential Decree. No. 474, as amended, shall be the single maritime
administration mandated to implement and enforce the 1978 International (i) Monitoring and verification of compliance with the
Convention on Standards of Training, Certification and Watchkeeping for Seafarers. standards of ratings;

It shall carry out an effective regulatory framework conducive to the efficiency,

transparency and competitiveness of the Philippine seafaring industry.
(ii) Harmonization of the procedures for periodic
evaluation, assessment and monitoring activities
Section 4.  Powers and Functions of the MARINA.—In addition to the mandate of undertaken by accredited institutions with registered
the MARINA under Presidential Decree No. 474, as amended, and in order to carry programs for ratings; and

 with a clear understanding of the consequences of

(iii) Issuance of certificates of proficiency to ratings.
enrolling in a phased-out program;

(3) The MARINA shall ensure that all legal and administrative (5) The MARINA shall coordinate with the DOH to ensure that the
measures relative to the issuance of certificates of competency of medical standards established to ascertain the medical fitness of
GMDSS radio operators are in accordance with the STCW seafarers are in accordance with the international conventions/
Convention. For this purpose, the MARINA shall assess, treaties and existing laws. For this purpose, the MARINA shall:

revalidate and issue GMDSS radio operator’s certificate in

accordance with the provisions under the STCW Convention.
(i) Ensure that the medical examinations and issuance of
(4) The MARINA shall ensure that all maritime education,
including the curricula and training programs, are structured and
delivered in accordance with the written programs, methods and
medical certificates by the DOH accredited hospitals,
medical clinics, and laboratories, including medical
practitioners are in accordance with the standards
prescribed by the STCW Convention; and

media of delivery, procedures, and course materials compliant (ii) Ensure that medical certificates are issued by a duly-
with international standards as prescribed under the STCW qualified medical practitioner recognized by and
Convention. For this purpose, the MARINA shall:
accredited with the DOH, and for this purpose, a register
of recognized medical practitioners shall be maintained
(i) Chair the Technical Panel on Maritime Education and made available to seafarers, shipping companies
(TPME) of the CHED; the TPME shall among others, and State parties to the STCW Convention,

formulate, review and recommend to the CHED  en

banc all policies, standards, and guidelines for maritime Section 5.  Composition of the Maritime Industry Board.—To ensure the proper
education, including curricula, facilities and guidelines;
implementation and enforcement of the STCW Convention in relation to
international maritime safety and environmental agreements, the Commandant of
(ii) Monitor and verify, in coordination with the CHED, the Philippine Coast Guard (PCG), in lieu of the Secretary of National Defense, shall
compliance with the policies, standards, and guidelines be included as member of the Maritime Industry Board established pursuant to
of maritime education in the conduct of maritime Presidential Decree No. 474 creating the MARINA. The Maritime Industry Board
education and training programs;-
may create an advisory council that will assist the MARINA in ensuring compliance
with the STCW Convention, as it may deem proper. The number and members of
(iii) Review and harmonize the procedures for periodic this council shall be identified and determined by the Maritime Industry Board.

evaluation, assessment and monitoring of all maritime

education and training institutions in accordance with Section 6. Appropriations.—The Secretary of Transportation and Communications,
the standards of the CHED and other recognized through, the MARINA, shall immediately include in its programs the
international organizations;
operationalization requirement of the STCW Services, the initial funding of which
shall be charged against the savings or current year’s appropriations of the
(iv) Develop, formulate and recommend for MARINA. Thereafter, such sums as may be necessary for the continued
implementation, strict quality assurance mechanisms implementation of this Act shall be included in the annual General Appropriations
and relevant typology for maritime education programs Act.

and institutions;

(v) Recommend to the CHED  en banc  the closure/
phase-out of substandard maritime education
institutions, in accordance with the rules and regulations,
as well as recommend alternative schemes or options
for the affected maritime educational institution;
certificates of competency, endorsement, proficiency arid documentary evidence
(vi) Maintain an updated list of compliant and phased-
out maritime education and training programs, publish
such lists in appropriate media, and provide the public
Section 7.  Implementing Rules and Regulations.—The MARINA shall issue the
required implementing rules and regulations in accordance with the provisions of
this Act within six (6) months from the effectivity hereof. In the formulation of such
rules and regulations, the MARINA shall ensure that the processes and procedures
for issuance, validation, verification, correction, revocation, or cancellation of
required of seafarers under the STCW Convention shall be the most efficient and
convenient way for the seafarers including, but not limited to, the establishment of
one-stop shop arrangements, computerization and automation, and elimination of
redundant fees and charges.

Section 8.  Transitory Provisions.—All certificates of competency, endorsement, (a) "Aerial work" refers to an aircraft operation in which an aircraft is used
proficiency and documentary evidence issued prior to the effectivity of this Act shall for specialized services such as agriculture, construction, photography,
be deemed valid without necessity of revalidation or reissuance until the date of surveying, observation and patrol, search and rescue, aerial
expiration as stated in such certificates or other documents. Thereafter, new advertisement, etc.

certificates or other documents shall be revalidated or reissued only in accordance (b) "Aerodrome" refers to an airport, a defined area on land or water
with the implementing rules and regulations issued pursuant to this Act, in (including any building, installation and equipment) intended to be used
conformity with the STCW requirements.
either wholly or in part for the arrival, departure and surface movement of
aircraft.

Section 9.  Separability Clause.—If for any reason any section or provision of this (c) "Aeronautics or aviation" refers to the science and art of flight.

Act is declared unconstitutional or invalid, the other sections, or provisions hereof (d) "Aeronautical telecommunication" refers to and includes any telegraph
not affected by such declaration shall remain in force and in effect.
or telephone communication signs, signals, writings, images and sounds
of any nature, by wire, radio or other systems or processes of signaling,
Section 10.  Repealing Clause.—The provisions of Presidential Decree No. 474 on used in the aeronautical service.

the composition of the Maritime Industry Board and all the provisions under (e) "Aeronautical telecommunication station" refers to any station operated
Republic Act No. 8544 relating to the examination, licensing and certification to provide telecommunications for aeronautical purposes.

system for marine deck and engine officers are hereby amended. All existing laws,
orders, decrees, rules and regulations or parts thereof inconsistent with the (f) "Air carrier or operator" refers to a person who undertakes, whether
provisions of this Act are hereby repealed or modified accordingly.
directly or indirectly, or by a lease or any other arrangements, to engage in
air transportation services or air commerce. The term may likewise refer to
Section 11. Effectivity Clause.—This Act shall take effect fifteen (15) days from its either a "Philippine air carrier" or a "foreign air carrier" as indicated by the
publication in the  Official Gazetteor in at least two (2) national newspapers of context.

general circulation.
(g) "Air commerce or commercial air transport operation" refers to and
includes scheduled or non-scheduled air transport services for pay or hire,
the navigation of aircraft in furtherance of a business, the navigation of
aircraft from one place to another for operation in the conduct of a
Republic Act No. 9497             March 04, 2008
business, or an aircraft operation involving the transport of passengers,
cargo or mail for remuneration or hire.

AN ACT CREATING THE CIVIL AVIATION AUTHORITY OF THE PHILIPPINES, (h) "Aircraft" refers to any machine that can derive support in the
AUTHORIZING THE APPROPRIATION OF FUNDS THEREFOR, AND FOR atmosphere from the reactions of the air other than the reactions of the air
OTHER PURPOSES
against the earth's surface. The term "aircraft", when used in this Act or in
regulations issued under this Act, shall refer to civil aircraft only, and will
Be it enacted by the Senate and House of Representatives of the Philippines in not include State or public aircraft.

Congress assembled::
(i) "Aircraft accident" refers to an occurrence associated with the operation
of an aircraft which takes place between the time any person boards the
CHAPTER I
 aircraft with the intention of flight until such time as all such persons have
GENERAL PROVISIONS
disembarked, in which:

(1) Any person suffers death or serious injury as a result of being

SECTION 1. Short Title. – This Act shall be known as the Civil Aviation Authority in or upon the aircraft or by direct contact with the aircraft of
Act of 2008.
anything attached thereto; or

(2) The aircraft receives substantial damage

SEC. 2.  Declaration of Policy.  - It is hereby declared the policy of the State to (j) "Aircraft radio station" refers to a radio station on board any aircraft.

provide safe and efficient air transport and regulatory services in the philippines by
providing for the creation of a civil aviation authority with jurisdiction over the (k) "Aircraft engine" refers to any engine use, or intended to be used, for
restructuring of the civil aviation system, the promotion, development and propulsion of aircraft and includes all parts, appurtenances, and
regulation of the technical, operational, safety, and aviation security functions under accessories thereof other than propellers.

the civil aviation authority.

(l) "Aircraft incident" refers to the occurrence, other than an accident,
which is associated with the operation of an aircraft when the safety of the
SEC. 3. Definition of Terms. - For purposes of this Act, the terms:
aircraft has been endangered, or is a situation which could endanger an
aircraft and if it occurred again in other circumstances.

(m) "Aircraft piracy" refers to any actual or attempted seizure or exercise of (v) "Air route and airway facilities" refers to facilities provided to permit
control, by force or violence, or by any other form of intimidation, with safe navigation of aircraft within the airspace of air routes and airways,
wrongful intent, of an aircraft within the jurisdiction of the Philippines.
including:

(n) "Airman" refers to any individual who engages, as the person in (1) Visual and non-visual aids along the air routes and airways

command or as pilot, mechanic, aeronautical engineer, flight radio (2) Visual and non-visual aids to approach and landing at airports;

operator or member of the crew, in the navigation of aircraft while under (3) Communication services;

way and any individual who is directly in charge of inspection, (4) Meteorological observations;

maintenance, overhauling, or repair of aircraft, aircraft engine, propellers, (5) Air traffic control services and facilities and

or appliances and individual who serves in the capacity of aircraft (6) Flight services and facilities.

dispatcher or air traffic control operator.

(o) "Airman license" refers to a written authorization or permission issued (w) "Airport" refers to any area of land or water designed, equipped, set
to any person for the exercise of the privileges of flying, maintaining, apart or commonly used for affording facilities for affording facilities for the
controlling, directing, dispatching, instructing or any other civil aviation landing and departure of aircraft and includes any area or space, whether
activity which is regulated and supervised by the Authority.
on the ground, on the roof of a building or elsewhere, which is designed,
equipped or set apart for affording facilities for the landing and departure
(p) "Air navigation" refers to the practice of controlling, guiding and of aircraft capable of descending or climbing vertically.

operating aircraft from airport of departure to predetermined airport of (x) "Air transport" refers to the transportation of persons, property, mail or
destination, including alternate airports. To ensure safety, regularity and cargo by aircraft.

efficiency of civil aviation operations, standardization and common (y) "Air transport service" refers to the act of transporting persons,
understanding among all parties involved are essential in all matters property, mail cargo, in whole or in part, by aircraft to points within or
affecting the operation of aircraft and the numerous facilities and services outside of the Philippines.

required in their support, such as airports, telecommunications, navigation (z) "Airworthiness" means that an aircraft, its engines, propellers, and other
aids, meteorology, air traffic services, search and rescue, aeronautical components and accessories, are of proper design and construction, and
information services and aeronautical charts, in accordance with the are safe for air navigation purposes, such design and construction being
procedures, rules and regulations contained in the appropriate Annexes to consistent with accepted engineering practice and in accordance with
the Chicago Convention.
aerodynamic laws and aircraft science.

(q) "Air navigation facility" refers to any facility used in, available for use in,
or designed for use in aid of air navigation, including airports, landing (aa) "Annexes to the Chicago Convention" refers to the documents issued
areas, lights, any apparatus or equipment for disseminating weather by the International Civil Aviation Organization (ICAO) containing the
information, for signaling, for radio directional finding, or for radio or other standards and recommended practices applicable to civil aviation.

electromagnetic communication, and any other structure or mechanism (bb) "Appliances" refers to instruments, equipment, apparatus, parts,
having a similar purpose for guiding or controlling flight in the air or the appurtenances, or accessories, of whatever description, which are used,
landing and take-off of aircraft.
or are capable of being or intended to be used, in the navigation,
(r) "Air navigation services" refers to and includes information, directions operation, or control of aircraft in flight (including parachutes and including
and other facilities furnished, issued or provided in connection with the communication equipment and any other mechanism or mechanisms
navigation or movement of aircraft, and the control of movement of installed in or attached to aircraft during flight), and which are not part or
vehicles in any part of an airport used for the movement of aircraft.
parts of aircraft, aircraft engines, or propellers.

(s) "Air operator" refers to any organization which undertakes to engage in (cc) "Authority" refers to the Philippine Civil Aviation Authority created
domestic commercial air transport or international commercial air pursuant to the provisions of this Act and shall, as indicated by the
transport, whether directly or indirectly, or by a lease or any other context, include the Board of Directors and/or Director General created
arrangement.
pursuant thereto.

(t) "Air Operator Certificate (AOC)" refers to a certificate authorizing an (dd) "Aviation certificate" means any airworthiness certificate, airman
operator to carry out specified commercial air transport operations.
certificate, air operator certificate, certificate authorizing the operation of
an aviation school or approved maintenance organization or other
(u) "Air route" refers to the navigable airspace between two points and the document issued by virtue of the provisions of this Act in respect of any
terrain beneath such airspace identified, to the extent necessary, for person, aircraft, airport or aviation-related service.

application of flight rules.

(ee) "Board of Directors" means the board of the civil aviation authority
created under this Act.

(ff) "Chicago Convention" refers to the international basis for civil aviation includes any trustee, receiver, assignee, or other similar representative of
agreements.
these entities.

(gg) "Citizen of the Philippines" refers to one of the following:

(ww) "Philippine air carrier" means an air carrier who is a citizen of the
(i) An individual who is a citizen of the Philippines;
Philippines.

(ii) A partnership of which each member is a citizen of the (xx) "Philippine aircraft" means an aircraft registered in the Philippines in
Philippines; or
accordance with the requirements of this Act.

(iii) A corporation or association created or organized and (yy) "Propeller" refers to an inclusive term for all parts, appurtenances, and
authorized under the laws of the Philippines.
accessories of a propeller.

(zz) "Public aircraft" refers to an aircraft used exclusively in the service of

(hh) "Civil aircraft" refers to any aircraft other than a State or public aircraft. any government or of any political jurisdiction thereof, including the
.
Government of the Philippines, but not including any government-owned
(ii) "Civil aviation" refers to the operation of any civil aircraft for the purpose aircraft engaged in operations which meet the definition of commercial air
of general aviation operations, aerial work or commercial air transport transport operations.

operations.

(jj) "Crew member" refers to a person assigned to perform duties on an (aaa)"Rules of the air" means those provisions for securing the safety of
aircraft in flight.
aircraft in flight and in movement on the surface and the safety of persons
(kk) "Dangerous goods" refers to articles or substances that are capable of and property on the surface. These provisions include:

posing significant risks to health or safety of property when transported by (1) Lights and signals to be shown by aircraft;

air.
(2) General, visual and instrument flight rules;

(ll) "Director General" refers to the Director General appointed under this (3) Airport traffic rules; and

Act.
(4) Airport signals and markings

(mm) "Domestic air commerce" means and includes air commerce within
the limits of the Philippine territory.
(bbb)"Spare parts" refers to any parts, appurtenances, and accessories of
(nn) "Domestic air transport" means air transportation within the limits of aircraft (other than aircraft engines and propellers), aircraft engines (other
the Philippine territory.
than propellers), propellers, and appliances, maintained for installation or
use in an aircraft, aircraft engine, propeller, or appliance, but which at the
(oo) "Foreign air carrier or foreign air operator" meane any operator, not time are not installed therein or attached thereto.

being a Philippine air operator, which undertakes, whether directly or

indirectly or by lease or any other arrangement, to engage in commercial (ccc) "Special aircraft jurisdiction of the Philippines." This includes:

air transport operations within borders or airspace of the Philippines, (i) Civil aircraft of the Philippines; and

whether on a scheduled or chartered basis.

(ii) Any other aircraft within the jurisdiction of the Philippines,
(pp) "Foreign air transport" refers to air transportation between the while the aircraft is in flight, which is from the moment when all
Philippines and any place outside it or wholly outside the Philippines.
external doors are closed following embarkation until the moment
(qq) "General aviation operation" refers to an aircraft operation of a civil when one such door is opened for disembarkation or, in case of a
aircraft for other than a commercial air transport operation or aerial work forced landing, until the competent authorities take over the
operation.
responsibility of the aircraft and the persons and property aboard.

(rr) "ICAO." Where used in this Act, refers to the abbreviation for the
International Civil Aviation Organization.
(ddd) "Validation" refers aboard to the written acceptance of an action of
(ss) "International commercial air transport" refers to the carriage by the civil aviation authority of another country in lieu of an action that this
aircraft of persons or property for remuneration or hire or the carriage of Act assigns to the Director General.

mail between any two (2) or more countries.

(eee) "Landing fees" refers to all charges for the use of any landing strip or
(tt) "Navigable airspace" refers to the airspace above the minimum runway by any aircraft landing or taking off at an aerodrome.

altitudes of flight prescribed by regulations under this Act and includes (fff) "Terminal fees" refers to charges far parking at or near the ramp,
airspace needed to insure safety in the take-off and landing of aircraft.
terminal area, or building, for purposes of loading or unloading passengers
(uu) "Navigation of aircraft" refers to a function that includes the piloting of and/or cargo.

aircraft.
(ggg) "Royalties" refers to all charges based on gross business or sales, or
(vv) "Person" refers to any individual, firm, partnership, corporation, gross or net profit.

company, association, joint-stock association, or body politic, and

 (hhh) "Supplies" includes any and all items of whatever nature or
description which may be necessary for, or incidental to, the operation of SEC. 6. Prohibited Interests. - All members of the Board or any of their relatives
an aircraft.
within the fourth civil degree of consanguinity or affinity, legitimate or common law,
shall be prohibited from holding any interest whatsoever, either as investor,
stockholder, officer or director, in any company or entity engaged in air commerce,
CHAPTER II
 whether scheduled or unscheduled, passenger or cargo, domestic or international,
ORGANIZATION OF AUTHORITY
or in any business providing support services to persons engaged in air commerce
(i.e. general sales agencies, travel agencies, cargo forwarders, ground handling,
SEC. 4.  Creation of the Authority.  - There is hereby created an independent catering, fuel servicing, aircraft maintenance, etc.) and must therefore divest,
regulatory body with quasi-judicial and quasi-legislative powers and possessing through sale or legal disposition, of any and all interests in such undertakings upon
corporate attributes to be known as the Civil Aviation Authority of the Philippines the member's assumption of office. Any violation of this section shall subject the
(CAAP), hereinafter referred to as the "Authority" attached to the Department of member concerned to removal from the Authority for cause as well as
Transportation and Communications (DOTC) for the purpose of policy coordination. administrative, civil or criminal prosecution under applicable laws.

For this purpose, the existing Air Transportation Office created under the provisions
of Republic Act No. 776, as amended, is hereby abolished.
SEC. 7. Limitation of Subsequent Employment. - No member of the Board or any
Notwithstanding the foregoing, nothing in this Act shall diminish the powers and employee of the Authority shall accept employment or enter into a contract of
functions of the Civil Aeronautics Board (CAB) as provided for under Republic Act. service with an entity regulated by the Authority until the expiry of one (1) year from
No. 776, also known as "The Civil Aeronautics Act of the Philippines", as amended.
the termination of his appointment, whether by resignation or revocation or
otherwise.

(a) Establishment of Authority Headed by a Director General - The Authority shall

beheaded by a Director General of Civil Aviation, referred to in this Act as the SEC. 8.  Quorum.  - The presence of at least four (4) members of the Board shall
"Director General," who shall be appointed by the President of the Philippines and constitute a quorum and the majority vote of three (3) members in a meeting where
shall be responsible for all civil aviation in the Philippines and the administration of a quorum is present shall be necessary for the adoption of any rule, ruling, order,
this Act. The Director General shall be appointed based on the qualifications herein resolution, decision or other act of the Board in the exercise of its functions.

provided and shall have a tenure of office for a period of four (4) years. His
appointment may be extended for another non-extendible term of four (4) years and SEC. 9.  Qualifications of Director General.  - No person shall be appointed or
shall only be removed for cause in accordance with the rules and regulations designated as the Director General unless he is a Filipino citizen, at least thirty-five
prescribed by the Civil Service Commission.
(35) years of age, of good moral character, unquestionable integrity, recognized
competence and a degree holder with at least five (5) years supervisory or
(b) Responsibility of the Director General - The Director General shall be responsible management experience in the field of aviation.

for the exercise of all powers and the discharge of all duties of the Authority and
shall have control over all personnel and activities of the Authority.
SEC. 10. Board Meetings. - The Board shall meet regularly once a month and may
hold special meetings to consider urgent matters upon call of the Chairman or upon
SEC. 5 .  Composition of the Board Members.  - The corporate powers of the the initiative of four (4) members. Internal rules of procedure in the conduct of
Authority shall be vested in a board, which is composed of seven (7) members:
Board meetings shall be as prescribed by the Board.

(a) The Secretary of the Department of Transportation and

Communications shall act as chairman ex officio;
SEC. 11. Per Diems. - The members of the Board shall receive a per diem for each
(b) The Director General of Civil Aviation (DGCA) shall automatically be the meeting actually attended. Theper diems  of the members of the Board shall be
vice chairman of the Board;
determined pursuant to a resolution adopted by the Board subject to compliance of
(c) The Secretary of Finance;
the guidelines duly existing and applicable by the Commission on Audit.

(d) The Secretary of Foreign Affairs;

(e) The Secretary of Justice;

SEC. 12. Personnel. - Qualified existing personnel of the Air Transportation Office
(f) The Secretary of the Interior and Local Government; and
(ATO) shall be given preference in the filling up of plantilla positions created in the
(g) The Secretary of the Department of Labor and Employment.
Authority, subject to existing civil service rules and regulations.

The Directors listed under subsection (a) to (g) shall be  ex officio  members of the SEC. 13.  Principal Office.  - The Authority shall have its principal office in Metro
Board of Directors:  Provided, That, in the absence of the Director appointed in Manila and may hold hearings on any proceedings at such time and places within
subsections (c) to (g), the Director concerned shall designate the officer next in rank the Philippines, as it may provide by order in writing.

to him in his department or office to act on his behalf as a Director.

SEC. 14.  Capitalization.  - The Authority shall have an authorized capital stock of SEC. 19.  Transfer of Properties.  - The funds and appropriations, records,
Fifty billion pesos (Php50,000,000,000.00) which shall be fully subscribed by the equipment and property of the AT0 is hereby transferred to the Authority.

Republic of the Philippines. The subscription of the National Government shall be

paid as follows:
SEC. 20. Annual Report. - The Authority shall prepare and submit an annual report
(a) The unexpended balances of appropriations in the current General to the President of the Philippines, to the Senate and to the House of
Appropriations Act and other acts in force upon approval hereof, Representatives on its accomplishments at the close of each calendar year.

pertaining to, held or used by, the ATO,

(b) The value of existing assets of the ATO, which shall be determined by CHAPTER III

an independent and qualified appraiser or appraisers within six (6) months GENERAL POLICIES

from the effectivity of this Act, and after deducting the loans and other
liabilities of the ATO at the time of the takeover of the assets and SEC. 21.  Policies.  - In the exercise and performance of its powers and duties
properties; and
under this Act, the Authority shall consider the following, among other things, as
(c) Such amounts as may be appropriated from time to time from the funds being in the public interest and in accordance with the public convenience and
of the National Treasury, including any outlay from the infrastructure necessity:

program of the National Government.

(a) The development and utilization of the air potential of the Philippines;

(b) The encouragement and development of an air transportation system

SEC. 15. Fiscal Autonomy. - The Authority shall enjoy fiscal autonomy. All moneys properly adapted to the present and future of foreign and domestic
earned by the Authority from the collection/levy of any and all such fees, charges, commerce of the Philippines;

dues, assessments and fines it is empowered to collect/levy under this Act shall be (c) The regulation of air transportation in such manner as to support sound
used solely to fund the operations of the Authority.
economic condition in such transportation and to improve the relations
The utilization of any funds coming from the collection and/or levy of the Authority between air carriers;

shall be subject to the examination of the Congressional Oversight Committee.

(d) Ensuring the safety, quality, reliability, and affordability of air transport
services for the riding public; and

SEC. 16. Exemption from Taxes, Customs and Tariff Duties. - (a) The importation (e) The encouragement and development of a viable and globally
of equipment, machineries, spare parts, accessories and other materials including competitive Philippine aviation industry.

supplies and services used solely and exclusively in the operations of the Authority
not obtainable locally shall be exempt from all direct and indirect taxes, wharfage CHAPTER IV

fees and other charges and restrictions, the existence of pertinent laws to the POWERS OF THE AUTHORITY

contrary notwithstanding.

(b) All obligations entered into by the Authority and any income derived therefrom, SEC. 22.  Powers and Functions.  - The Authority shall have such powers as are
including those contracted with private international banking and financial granted to the Board and the Director General under the provisions of this Act.

institutions, shall be exempt from all taxes, both principal and interest. The
Authority is also exempt from the payment of capital gains tax, documentary stamp SEC. 23. Corporate Powers. - The Authority, acting through the Board, shall have
tax, real property estate tax and all other local government-imposed taxes and fees.
the following corporate powers:

(a) To succeed in its corporate name, to sue and be sued in such

SEC. 17. Schedule of Fees and Charges. - The Authority shall adopt and publish corporate name, and to adopt, use and alter its corporate seal, which shall
its schedule of fees and charges. The Authority shall hold such public hearings or be judicially noticed;

consultative meetings with stakeholders in the industry before adapting its (b) To adopt, amend or repeal its bylaws;

schedule of fees and charges. The Authority shall not revise its schedule of fees (c) To enter into, make, perform and carry out contracts of every class,
and fines more often than once every three (3) years.
kind and description, which are necessary or incidental to the realization of
its purposes, with any person, domestic or foreign private firm, or
SEC. 18.  Compensation and Other Emoluments of Authority Personnel.  - corporation, local or national government office, agency and with
Within six (6) months from the effectivity of this Act, the Board shall determine the international institutions or foreign government;

new schedule of salaries of the employees of the Authority subject to the (d) To raise money, contract loans, indebtedness, credit and issue
compliance with the existing compensation laws:  Provided, That the Board shall commercial papers and bonds, in any local or convertible foreign currency
determine and fix the compensation and fringe benefits of employees holding from any other international financial institutions under terms and
technical positions that are not common to the other agencies of the government conditions prescribed by law, rules and regulations;

which shall be specified in the Implementing Rules and Regulations.

 (e) To execute any deed of guarantee, mortgage, pledge, trust or purposes of this section to be under oath and verified by the person in
assignment of any property for the purpose of financing the programs and custody thereof as to the truth and correctness of data appearing in such
projects deemed vital for the attainment of its goals and objectives;
books, papers, tariffs, contracts, agreements and all other documents;

(f) To construct, acquire, own, hold, operate, maintain, administer and (f) Exercise appellate powers to order the taking of depositions in any
lease personal and real properties, including buildings, machinery, proceeding, or investigation, pending before the Board at any stage of
equipment, other infrastructure, agricultural land, and its improvements, such proceeding or investigation;

property rights, and interests therein, and to encumber, mortgage,
dispose, sell, or alienate or otherwise dispose the same at the fair market
value it may deem appropriate; to lease its plant, machinery, equipment or
goods not immediately required by it: Provided, That no real property thus
acquired and any other real property shall be sold without the approval of
(g) Use available services, equipment, personnel and facilities of other
agencies of the Philippine Government, on a reimbursable basis when
appropriate and, on a similar basis, to co-operate with those agencies in
the establishment and use of services, equipment and facilities of the
Authority;

the President of the Philippines;

(h) Use the property of the Authority in such a manner as may appear to
(g) To receive gifts, donations, grants, bequests, services, properties, the Authority to be requisite, advantageous or convenient with a view to
whether personal or real, and assistance of all kinds, from private and making the best use of any of the property of the Authority in relation to its
public sources, firms, institutions, domestic and foreign governments, and functions under this Act;

international institutions, and utilize the same for the purposes set forth in (i) Invest such of the Authority's funds that are not immediately required for
this Act;
operating expenses, or other immediate obligations in any business
(h) To invest its funds and other assets in such areas, ventures, and venture the Board may deem appropriate, or in such secured note,
projects as it may deem wise;
government securities, and other negotiable instruments that satisfy the
(i) To settle, under such terms and conditions most advantageous to it, any guidelines prescribed by the Board. Funds of the Authority shall be
claim by or against it;
deposited in such commercial and universal banks as the Board may
(j) To determine and keep its own system of accounts following generally determine, subject to the requirements of existing laws. The Board shall
accepted principles of accounting, as well as the forms and contents of its designate the officials authorized to deposit in or withdraw funds from
contracts and other business documents; and
such depository banks;

(k) To perform such other acts, as are necessary or convenient in

connection with the performance of its functions, to carry out the (j) Promulgate rules and regulations as may be necessary in the interest of
purposes of this Act.
safety in air commerce pertaining to the issuance of the airman's
certificate including the licensing of operating and mechanical personnel,
CHAPTER V
 type certificate for aircraft, aircraft engines, propellers and appliances,
POWERS AND FUNCTIONS OF THE BOARD
airworthiness certificates, air carrier operating certificates, air agency
certificates, navigation facility and aerodrome certificates; air traffic routes;
SEC. 24.  Powers of the Board.  - The Board shall have the following general radio and aeronautical telecommunications and air navigation aids; aircraft
powers: accident inquiries; aerodromes, both public and private-owned;
(a) Provide comprehensive policy guidance for the promotion and construction of obstructions to aerodromes; height of buildings; antennae
development of the Philippine aviation industry, as provided for in this Act;
and other edifices; registration of aircrafts; search and rescue; facilitation
(b) Ensure that the Authority performs its functions in a proper, efficient of air transports; operations of aircrafts, both for domestic and
and effective manner;
international, including scheduled and non-scheduled; meteorology in
(c) Decide the objectives, strategies and policies of the Authority in relation to civil aviation; rules of the air; air traffic services; rules for
accordance with the provisions of this Act;
prevention of collision of aircrafts, identification of aircraft; rules for safe
(d) Determine the organizational structure of the Authority in accordance altitudes of flight; and such other rules and regulations, standards,
with the provisions of this Act, establish a human resources management governing other practices, methods and/or procedures as the Director
system based on merit and fitness, and adopt a rational compensation General may find necessary and appropriate to provide adequately for
and benefits scheme;
safety regularity and efficiency in air commerce and air navigation;

(e) Exercise appellate powers on any decisions, findings and rulings of the
Director General, to issuesubpoena ad testificandum  or  subpoena duces
tecum requiring the attendance and testimony of witnesses in any matter
or inquiry pending before the Board and require the production of books,
papers, contracts, agreements and all other documents submitted for
(k) Impose and fix reasonable charges and fees for the use of government
aerodromes or air navigation facilities; for services rendered by the
Authority in the rating of any aerodrome or air navigation facilities, civil
 aviation schools and instructors, aircraft repair stations, and aircraft radio amendment or successor thereto and the International Civil Aviation Organization
and aeronautical telecommunications stations;
Standards and Recommended Practices. Pending the promulgation of such new
(l) Fix the reasonable charges to be imposed in the use of privately-owned rules and regulations, the current rules and regulations of the AT0 shall continue to
air navigation facilities and aerodromes;
apply.

(m) Adopt a system for the registration of aircraft as hereinafter provided;

(n) Determine and fix, landing fees, parking space fees, royalties on sales SEC. 26.  Setting of Charges and Fees.  - The Board, after consultation with the
or deliveries, direct or indirect, to any aircraft for its use of aviation Director General, and after public hearing, shall determine, fix, impose, collect or
gasoline, oil and lubricants, spare parts, accessories and supplies, tools, receive reasonable charges, fees, dues or assessments in respect of aviation
other royalties, fees or rentals for the use of any of the property under its certificates, licenses and all other authorizations or permissions authorized to be
management and control;
issued under this Act and all services performed by the Authority. All charges and
(o) Approve the annual and supplementary budget plan and utilization of fees shall be formally promulgated in accordance with the requirements of the
retained revenue;
Administrative Code of the Philippines or any amendment or successor thereto.
(p) Exercise the corporate powers granted to the Authority;
Pending the promulgation of such new schedule of charges and fees, the current
charges and fees of the AT0 shall continue to apply.

(q) Upon its own initiative or the recommendation of the Director General
or an application of a private person, grant exemption from the SEC. 27.  Issuance of Rules of Procedure and Practice.  - The Board may
requirements of observing rules or regulations issued in accordance with authorize the Director General to issue or amend rules of procedures and practice
this Act: Provided, That said grant of exemption is not prejudicial to flight as may be required to be issued pursuant to the provisions of this Act or issue and
safety;
adopt rules and regulations and other issuances of the ICAO. Pending the
(r) Formulate rules and regulations concerning compliance of the carrier promulgation of such new rules of procedures and practice, current rules of
and the public for the safe transport of goods and materials by air procedures and practices of the AT0 shall continue to apply.

pursuant to international standards or Annexes to the Chicago

Convention; and
SEC. 28.  Appellate Powers.  - The Board, on an appeal properly taken by an
(s) In coordination with the appropriate government agency tasked to interested party from a decision, judgment or order of the Director General, shall
provide airport security, shall:
have the power to:

(1) Prescribe reasonable regulation requiring that all passengers (a) Review, confirm, modify, revise, amend or reverse, as the case may be,
and all property intended to be carried in the aircraft cabin in decisions, judgments and/or orders of the Director General;

commercial air transport be screened by weapon-detecting (b) Confirm, remit, mitigate, increase or compromise, as the case may be,
procedure or facilities employed or operated by employees or fines imposed by the Director General pursuant with the provisions of this
agents of the air operator or foreign air operator prior to boarding Act; and

the aircraft for such transportation;

(c) Review, confirm, modify, revise, amend or reverse, as the case may be,
(2) Prescribe such other reasonable rules and regulations impositions by the Director General of liens on personal and real
requiring such parties, methods and procedures as the Director properties of entities, persons, corporations or partnerships in default, or
General may find necessary to protect persons and property those who have failed to perform their obligations pursuant to rules and
aboard aircraft operating in commercial air transport against acts regulations promulgated under this Act, or those who shall have failed to
of criminal violence and aircraft piracy; and
pay the fines or other pecuniary penalties for violation thereof,

(3) To the extent practicable, require uniform procedures for the

inspection, detention, and search of persons and property in In no case that the Director General shall participate in the hearing and adjudication
domestic commercial air transport and international commercial of an appealed case before the Board where the subject of appeal is a judgment or
air transport to assure their safety and to assure that they will decision rendered by his office. In such case, it requires four (4) concurring votes of
receive courteous and efficient treatment by air operators and the members of the Board who actively participated in the deliberation of the
their agents and employees.
appealed case before the judgment or decision of the Director General can be
modified or reversed.

SEC. 25.  Issuance of Rules and Regulations.  - The Board, in consultation with SEC. 29.  Power to Administer Oaths.  - The members of the Board, the Director
the Director General, shall issue and provide for the enforcement of such orders, General and such other duly designated officers of the Authority shall have the
rules and regulations as may be necessary to give effect to the provisions of this authority to administer oaths in the transaction and performance of their official
Act. All rules and regulations issued in accordance with the provisions of this Act duties.

shall be formally promulgated and periodically reviewed and updated in accordance

with the requirements of the Administrative Code of the Philippines or any
SEC. 30.  Annual Budget.  - The Board shall adopt an annual budget to fund the of the Authority. The Director General may also authorize attendance of courses
operations of the Authority.
given in such schools by other governmental personnel and personnel of foreign
governments, or personnel of the aeronautical industry.

SEC. 31.  Delegation of Functions.  - (a) Delegation to Officers, Employees and

Administrative Units of the Authority - The Director General may, subject to such (b) Offset of Training Costs - The Director General is hereby authorized, where
regulations, supervision and review as may be prescribed, authorize the appropriate, to require payment of appropriate consideration to offset the costs of
performance by any officer, employee, or administrative unit under the Director training provided by such school or schools.

General's jurisdiction of any function under this Act.

(b) Delegation to Private Persons - The Director General, in accordance with the
policy guidelines prescribed by the Board, is authorized to delegate any assigned
powers and duties to any properly qualified private person subject to his continuing
supervision, regulation, and review as may be prescribed. However, the Director
General shall ensure that such functions are not delegated in such a way that air
CHAPTER VII

THE DIRECTOR GENERAL
SEC. 35. Powers and Functions of the Director General. - The Director General
shall be the chief executive and operating officer of the Authority. He shall have the
following powers, duties and responsibilities:

operators, aerial work or general aviation operators and maintenance facilities, in

effect, regulate themselves.
(a) To carry out the purposes and policies established in this Act; to
enforce the provisions of the rules and regulations issued in pursuance to
SEC. 32.  Limitation of Powers.  - The Board shall not exercise any power or said Act; and he shall primarily be vested with authority to take charge of
function not otherwise expressly granted to it under this Act, neither shall the Board the technical and operational phase of civil aviation matters;

exercise, in the first instance, any power or function that properly falls within the (b) To designate and establish civil airways, to acquire, control, operate
authority, jurisdiction, powers or functions of the Director General.
and maintain along such airways, navigation facilities and to chart such
airways and arrange for their publication including the aeronautical charts
CHAPTER VI
 or maps required by the international aeronautical agencies, by utilizing
THE AUTHORITY PROPER
the equipment, supplies or assistance of existing agencies of the
government as far as practicable;

SEC. 33. Organizational Structure of the Authority. - Within fifteen (15) days from (c) To issue airman's certificate specifying the capacity in which the holder
the appointment of and acceptance by all members of the Board and the Director thereof is authorized to serve as airman in connection with aircraft and
General of their respective appointments, the Board, in consultation with the shall be issued only upon the finding that the applicant is properly qualified
Director General, shall meet to draw-up the Authority's organizational structure. The and physically able to perform the duties of the position. The certificate
Board shall agree on the Authority's final organizational structure not later than six shall contain such terms, conditions and limitations as the Director
(6) months from the date of the effectivity of this Act.
General may determine to be necessary to assure safety in air
In addition to the offices created under Sections 36 and 40 of this Act, the Board commerce:  Provided,  however, That the airman's license shall be issued
shall establish the following permanent offices:
only to qualified persons who are citizens of the Philippines or qualified
(a) Air Traffic Service;
citizens of countries granting similar rights and privileges to citizens of the
(b) Air Navigation Service;
Philippines;

(c) Aerodrome Development and Management Service; and

(d) To issue airworthiness certificate for aircraft which shall prescribe the
(d) Administrative and Finance Service.
duration of such certificate, the type of service for which the aircraft may
be used, and such other terms and conditions and limitations as are
The Board may agree for the viability for the creation of additional offices and the required;

finalization of the organizational structure not later than six (6) months from the date (e) To issue air carrier operating certificate in accordance with the
of the effectivity of this Act.
minimum safety standards for the operation of the air carrier to whom
Notwithstanding the qualification standards as may be prescribed by the Board and such certificate is issued. The air carrier operating certificate shall be
the Civil Service Commission, the selection and appointment of the heads of the issued only to aircrafts registered under the provisions of this Act;

foregoing offices shall be limited from the rank and file employees of the concerned
services.
(f) To issue type certificate for aircraft, aircraft engine, propellers and
appliances;

SEC. 34. Training Schools. - (a) Authority to Operate - The Director General may (g) To inspect, classify and rate any air navigation facilities and aerodromes
conduct a school or schools for the purpose of training employees of the Authority available for the use of aircraft as to its suitability for such use and to issue
in those subjects necessary for the proper performance of all authorized functions a certificate for such air navigation facility and aerodrome; and to
determine the suitability of foreign aerodromes, air navigation facilities as duplication of the laboratory research, activities or technical studies of any
well as air routes to be used prior to the operation of Philippine-registered existing governmental agency;

aircraft in foreign air transportation and from time to time thereafter as may (r) To designate such prohibited and danger areas, in consonance with the
be required in the interest of safety in air commerce;
requirements of the international aeronautical agencies and national
(h) To issue certificates of persons or civil aviation schools giving security;

instruction in flying, repair stations, and other air agencies and provide for (s) To issue, deny, suspend, cancel or revoke any certificate, license
the examination and rating thereof;
pertaining to aircraft, airmen and air agencies:  Provided, That any order
(i) To provide for the enforcement of the rules and regulations issued under denying, suspending, cancelling, revoking the certificate or license may he
the provisions of this Act and to conduct investigation for violations appealed to the Board, whose decisions shall he final within fifteen (15)
thereto. In undertaking such investigation, to require by  subpoena ad days from the date of notification of such denial, cancellation or
testificandum or subpoena duces tecum, the attendance and testimony of revocation;

witnesses, the production of books, papers, documents, exhibits matter, (t) To grant authorization to civil aircraft or persons to carry instruments or
evidence, or the taking of depositions before any person authorized to photographic devices to be used for aerial photography or taking of
administer oath. Refusal to submit the reasonable requirements of the pictures by photograph or sketching of any part of the Philippines; and

investigation committee shall be punishable in accordance with the (u) Pursuant to a board resolution, to enter into, make and execute
provisions of this Act;
contracts of any kind with any person, firm, or public or private
(j) To collect and disseminate information relative to civil aeronautics and corporation.

the development of air commerce and the aeronautical industry; to

exchange with foreign governments, information pertaining to civil SEC. 36.  The Office of Enforcement and Legal Service.  - To effectively
aeronautics; and to provide for direct communication on all matters implement the civil aviation regulatory, supervisory and administrative mandates of
relating to the technical or operational phase of aeronautics with the Director General under this Act, a permanent office within the Authority to be
international aeronautical agencies:
known as the Enforcement and Legal Service, to be composed of in-house
counsels of the Authority and its necessary support staff shall be established by the
(k) To acquire and operate such aircraft as may be necessary to execute Board.

the duties and functions of the Authority prescribed in this Act;

(l) To plan, design, acquire, establish, construct, operate, improve, This office shall provide adequate legal assistance and support to the Director
maintain, and repair necessary aerodromes and other air navigation General and to the Authority, as a whole, in the exercise of quasi-legislative and
facilities;
quasi-judicial power as provided for under this Act.

(m) To collect and receive charges and fees for the registration of aircraft
and for the issuance and/or renewal of licenses or certificates for aircraft, The exercise of the function by the Director General to issue subpoena ad
aircraft engines, propellers and appliances, and airmen as provided in this testificandum, subpoenaduces tecum and the imposition of any administrative
Act;
sanction shall be within the exclusive determination and recommendation of the
(n) To impose fines and/or civil penalties in respect thereto;
Enforcement and Legal Service.

(o) To participate actively with the largest possible degree in the

development of international standardization of practices in aviation SEC. 37. Orders. - (a) Effectiveness of Orders - Except in emergency situations, all
matters important to safe, expeditious, and easy navigation, and to orders, rules and regulations of the Director General shall take effect within such
implement as far as practicable the international standards, recommended reasonable times as the Director General may prescribe, and shall continue in force
practices and policies adopted by appropriate international aeronautical until a further order, rule or regulation, or for a specified period of time, as shall be
agencies;
prescribed in the order, rule or regulation.

(p) To exercise and perform its powers and duties under this Act
consistent with any obligation assumed by the Republic of the Philippines
in any treaty, convention or agreement on civil aviation matters;
the Director General shall have the power, either upon complaint or the Director
(q) To cooperate, assist and coordinate with any research and technical
agency of the government on matters relating to research and technical
studies on design, materials, workmanship, construction, performance,
maintenance and operation of aircraft, aircraft engines, propellers,
appliances, and air navigation facilities including aircraft fuel and
oil:  Provided, That nothing in this Act shall be construed to authorize the
(b) Emergencies - Whenever the Director General is of the opinion that an
emergency requiring immediate action exists with respect to safety in civil aviation,
General's initiative without complaint, at once, if the Director General so orders,
without answer or other form of pleading by the interested person or persons, and
with or without notice, hearing, or the making or filing of a report, to make such just
and reasonable orders, rules or regulations as may be essential in the interest of
safety in civil aviation to meet such emergency: Provided, That the Director General
shall immediately thereafter initiate proceedings relating to the matter giving rise to will assist the Director General in carrying out the responsibilities of his office for
any such order, rule or regulation.
certification and ongoing inspections of aircraft, airmen and air operators.

(c) Suspension and Modification of Orders - The Director General shall have the
power to suspend or modify orders upon such notice and in such manner as the The FSIS shall perform the following functions:

Director General shall find proper.

(1) Airworthiness inspection;

(d) Public Compliance - It shall be the duty of every person (along with any agents (2) Flight operations inspection and evaluation; and

and employees thereof in the case of entities other than individuals), subject to this (3) Personnel licensing.

Act, to observe and comply with any order, rule, regulation, or certificate issued by
the Director General under this Act, affecting such person so long as the same shall Furthermore, the Board shall create, but not limited to, the following offices which
remain in effect.
will provide support to the functions of the FSIS, namely: Aircraft Registration,
Aircraft Engineering and Standards, Airmen Examination Board and Office of the
SEC. 38.  Right of Access for Inspection.  - (a) The Director General or his Flight Surgeon.

authorized representative shall be authorized access to civil aircraft, including

aerodromes, without restriction wherever they are operated within the Philippines SEC. 41.  Validation.  - The Director General is authorized, in the discharge of his
for purposes of ensuring that those aircraft are airworthy and being operated in certification and inspection responsibilities, to validate the actions of the civil
accordance with this Act, regulations issued under this Act, and applicable ICAO authority of another State in lieu of taking the specific action, with the following
Annexes.
restrictions:

(b) The Director General or his authorized representative shall be authorized access (a) For actions on airman or airworthiness certificates, the other State must
to civil aircraft registered in the Philippines without restriction wherever they are be a signatory to the Chicago Convention and he fulfilling its obligations
operated in the world for the purposes of ensuring that these aircraft are airworthy under the Chicago Convention with respect to the issuance and currency
and are being operated in accordance with this Act and applicable regulations and of these certificates; and

directives.
(b) For actions applicable to air operators, the Director General must
exercise discretion and require supporting documents. The Director
(c) The Director General or his authorized representative shall be authorized access General should ensure that, when validation is based on the actions of
by the Philippine air operators at any place and any time to conduct any tests or another civil aviation authority, there is no information to indicate that the
inspections in their facility or offices in order to determine that those operations are State does not meet its obligations under the Chicago Convention
conducted in accordance with this Act and applicable regulations and directives.
regarding certification and ongoing validation of its air operators.

(d) The Director General or his authorized representative shall be authorized access SEC. 42.  Aircraft Accident Investigation and Inquiry Board.  - Pending the
to any aerodromes, whether privately or government-owned, to conduct establishment of an independent and separate government agency created to
inspections or evaluation of the facilities therein in order to determine that its conduct investigation of accidents on land, air and water, the Director General shall
operations are conducted.
organize an Aircraft Accident Investigation and Inquiry Board (AAIIB), to be
composed of personnel of the Authority specialized in the various disciplines of civil
SEC. 39.  Authority to Prevent Flight.  - (a) The Director General is authorized to aviation. The Board shall appoint the head of the AAIIB.

direct the operator or airman of a civil aircraft that the aircraft is not to be operated
in situations where:
(a) Reporting of Accidents - The Board shall promulgate rules and regulations
(1) The aircraft may not be airworthy; or
governing the notification and the reporting of accidents and incidents involving
(2) The airman may not be qualified or physically or mentally capable for aircraft.

the flight; or
(b) General Authority to Investigate - Except as provided in subsection c of this
(3) The operation would cause imminent danger to persons or property on section, the Director General shall have:

the ground.

(1) The power to investigate, or arrange by contract or otherwise for the

(b) The Director General may take such steps as are necessary to detain such investigation of, accidents involving aircraft occurring in the Philippines
aircraft or airmen.
and civil aircraft registered in the Fhilippines occurring outside the territory
of any foreign country for the purpose of determining the facts, conditions
SEC. 40.  Creation of Flight Standards Inspectorate Service.  - (a) The Board, and circumstances relating to each accident and the probable cause
other than the offices it shall create in furtherance of this Act, shall establish a thereof; and

permanent office known as the Flight Standards Inspectorate Service (FSIS) that (2) The authority to participate in the investigation of accidents involving
aircraft registered in the Philippines occurring outside the territory of a
 foreign country, consistent with any treaty, convention, agreement, or other SEC. 45.  Application for Aircraft Registration.  - Applications for certificate of
arrangemest between the Philippines and the country in whose territory registration shall be made in writing, signed and sworn to by the owner or lessee of
the accident occurred.
any aircraft or aircraft engine eligible for registration. The application shall also
state: (a) the date and place of filing; (b) the specification, construction and
(c) Accident Prevention - The Director General shall take any corrective actions technical description of the aircraft or aircraft engine; and (c) such other information
which, on the basis of the findings of the accident investigations authorized under as may be required by the Authority in such manner and form as the Authority may
this section, that, in the judgment of the Director General, will tend to prevent prescribe by regulation.

similar accidents in the future.

(d) Investigation of Accidents Within Military Sites - Notwithstanding any other SEC. 46.  Issuance of Certificate of Registration.  - Should the Director General,
provision of this section, and, the investigation of an accident involving aircraft upon considering the application for registration, find the aircraft or aircraft engine
occurring within military sites in the Philippines, or an accident involving solely an eligible for registration, such aircraft shall be registered under the provisions of this
aircraft of the armed forces of any foreign country occurring in the Philippines, shall Act and the owner thereof shall be issued a certificate of registration.

be the responsibility of the military. For the purpose of this subsection, the term
'military sites' means those areas within the Philippines which are under the control SEC. 47.  Nationality.  - An aircraft shall acquire Philippine nationality when
of the military of the Philippines or the military of another country.
registered pursuant to this Act.

(e) Use as Evidence - No part of any report or reports of the Director General
relating to any accident, or the investigation thereof, shall be admitted as evidence SEC. 48.  Revocation.  - Any certificate of registration may be revoked by the
or used in any suit or action for damages arising out of any matter mentioned in Authority for any cause which renders the aircraft ineligible for registration.

such report or reports except when the criminal liabilities/aspects of the accident is
put into issue.
SEC. 49.  Conveyance to be Recorded.  - No conveyance made or executed,
which affects the title to, or interest in, any aircraft of Philippine registry, or any
CHAPTER VIII
 portion thereof shall be valid in respect to such aircraft or portion thereof against
NATIONALITY AND OWNERSHIP OF AIRCRAFT
any person other than the person by whom the conveyance is made or executed,
his heirs, assignees, executors, administrators, devisees, or successors in interest,
SEC. 43. Establishment of Registry. - The Authority shall:
and any person having actual notice thereof, until such conveyance is recorded in
(a) Establish and maintain a system for the national registration of aircraft the Authority. Every such conveyance so recorded shall be valid as against all
in the Philippines;
persons. Any instrument, recording of which is required by the provisions of this
(b) Establish and maintain a system for the registration of liens, mortgages Act, shall take effect from the date of its record in the books of the Authority, and
or other interests in aircraft or aircraft engines; and
not from the date of its execution.

(c) Have sole authority to register aircraft and liens, mortgages or other
interests in aircraft or aircraft engines.
SEC. 50.  Form of Conveyance.  - No conveyance may be recorded under the
provisions of this Act unless it complies with the requirements for the registration of
SEC. 44.  Eligibility for Registration.  - Except as otherwise provided in the documents similar to the land registration process. The conveyance to be recorded
Constitution and existing treaty or treaties, no aircraft shall be eligible for shall also state: (a) the interest in the aircraft of the person by whom such
registration unless it is owned by or leased to a citizen or citizens of the Philippines conveyance is made or executed or, in the case of a contract of conditional sale,
or corporations or associations organized under the laws of the Philippines at least the interest of the vendor; and (b) the interest transferred by the conveyance.

sixty  per centum(60%) of whose capital is owned by Filipino citizens. That, under
such rules and regulations to be promulgated by the Board, foreign-owned or
registered aircraft may be registered if utilized by members of aero clubs organized
for recreation, sport or the development of flying skills as a prerequisite to any
aeronautical activities of such clubs within the Philippine airspace. (R.A. 776, P.D.
SEC. 51. Establishment of System of Recording. - The Authority shall establish a
national system for recording documents that affect the title to or any interest in any
aircraft registered in accordance with this Act and in any aircraft engine, propeller,
appliance or spare parts intended for use on any such aircraft.

1278, E.O. 546, and B.P. 504)

Such certificate shall be conclusive evidence of nationality for international SEC. 52.  Method of Recording.  - The Authority shall record conveyances
purposes, but not in any proceeding under the laws of the Republic of the delivered to it in the order of their receipt, in files kept for that purpose, indexed to
Philippines.
show:

(a) The identifying description of the aircraft;

The certificate of registration is conclusive evidence of ownership, except in a (b) The names of the parties to the conveyance;

proceeding where such ownership is, or may be, at issue.

(c) The date of the instrument and the date and time it is recorded;

(d) The interest in the aircraft transferred by the conveyance;

 (e) If such conveyance is made as security for indebtedness, the amount is physically able to, perform the duties pertaining to the position for which the
and date of maturity of such indebtedness; and
airman certificate is sought, the Director General shall issue such certificate.

(f) All particular estates, mortgages, liens, leases, orders and other
encumbrances and all decrees, instruments, attachments or entries SEC. 59. Terms and Conditions. - The airman certificate shall contain such terms,
affecting aircraft and other matters properly determined under this Act.
conditions and tests of physical fitness, and other matters as may be necessary to
assure safety in civil aviation.

SEC. 53. Validity Before Filing. - Upon the establishment of a recording system in

accordance with the provisions of this Act, no document affecting the title to or any SEC. 60. Contents. - Each airman certificate shall:

interest in such registered aircraft, aircraft engines, propellers, appliances, or spare (a) Be numbered and recorded by the Authority;

parts shall be valid except as between the parties thereto, unless the document is (b) State the name and address of, and contain a description of the
registered in such recording system.
individual to whom the airman certificate is issued; and

(c) Be titled with the designation of the airman and its authorized
SEC. 54.  Previously Unrecorded Ownership.  - Applications for the issuance or privileges.

renewal of an airworthiness certificate for aircraft whose ownership has not been
recorded as provided in this Act shall contain such information with respect to the B. Airworthiness Certificate

ownership of the aircraft as the Director General shall deem necessary to show who
have property interests in such aircraft and the nature and extent of such interest.
SEC. 61.  Authority to Issue Airworthiness Certificates.  - The owner of any
aircraft registered in accordance with this Act may file with the Director General an
CHAPTER IX
 application for an airworthiness certificate for such aircraft.

AVIATION SAFETY POWERS AND FUNCTIONS

SEC. 55.  General Powers and Functions.  - (a) Promoting Safety - The Director
General shall have the pawer and duty to promote safety of flight of civil aircraft in
civil aviation by prescribing and revising from time to time as necessary:
General.
SEC. 62. Issuance. - If it is found that the aircraft conforms to the appropriate type
of certificate and, after inspection, finds that the aircraft is in a condition allowing
for safe operation, an airworthiness certificate shall be issued by the Director

(1) Reasonable rules and regulations implementing, at minimum, all

standards of the Annexes to the Chicago Convention; and
SEC. 63.  Terms and Conditions.  the Director General shall prescribe in the
(2) Such other reasonable rules, regulations, or minimum standards airworthiness certificate the duration of such certificate, the types of service for
governing other practices, methods, and procedures as the Director which the aircraft may be used, and such other terms, conditions, limitations and
General may find necessary to provide adequately for safety in civil information as are required in the interest of safety. Each airworthiness certificate
aviation.
issued by the Director General shall be recorded by it.

(b) Considerations in the Regulation of Air Operators - In prescribing standards, SEC. 64.  Airworthiness Approvals.  - The Director General may prescribe the
rules and regulations, and in issuing certificates under this Act, the Director General terms under which additional airworthiness approvals, for purposes of modification,
shall take into consideration the obligation of air operators to perform their services may be made.

with the highest possible degree of safety pursuant to public interest.

C. Air Operator Certificate

SEC. 56.  Form of Applications.  - Applications for certificates issued by virtue of

this chapter shall be in such form, contain such information, and be filed and SEC. 65.  Authority to Certificate Carriers and Establish Safety Standards.  -
served in such manner as the Authority may prescribe and shall be under oath or The Director General is authorized to issue air operator certificates and to establish
affirmation whenever the Authority so requires.
minimum safety standards for the operation of the air carrier to which any such
certificate is issued.

A. Certification of Airmen

SEC. 57. Authority to Certificate Airmen. - The Director General is authorized to SEC. 66.  Application and Issuance.  - Any air carrier who is a citizen of the
issue airmen certificates specifying the capacity in which the holders thereof are Philippines may file with the Director General an application for an air operator
authorized to serve as airman in connection with an aircraft.
certificate. If the Director General finds, after thorough investigation, that such air
carrier is properly and adequately equipped and has demonstrated the ability to
SEC. 58.  Application and Issuance.  - Any individual may file with the Director conduct a safe operation in accordance with the requirements of this Act and the
General an application for an airman certificate. If the Director General finds, after rules, regulations and standards issued pursuant thereto, the Director General shall
due investigation, that such individual possesses the proper qualifications for, and issue an air operator certificate to such air carrier:  Provided,  however, That in no
event shall the Director General issue an air operator certificate to an air carrier that
does not possess a valid Certificate of Public Convenience and Necessity (CPCN) SEC. 69. Duties and Operations of Airmen. - It shall be the duty of:

issued pursuant to this Act and its implementing rules.

(a) Each air carrier to make or cause to be made, such inspection,

D. Aviation Schools and Approved Maintenance Organizations
maintenance, overhaul and repair of all equipment used in air transport
and to ensure that the operations conducted are in accordance with the
SEC. 67. Examination and Rating. - The Director General is authorized to provide provisions of this Act and the rules, regulations, directives and orders
for the examination and rating of:
issued by virtue of this Act;

(b) Each air carrier holding an air operator certificate to ensure that the
(a) The adequacy of the course of instruction, the suitability and maintenance of aircraft and operations thereof are conducted in the public
airworthiness of the equipment and the competency of the instructors of interest and in accordance with the requirements of this Act and the rules,
civilian schools providing instruction in flying or in the repair, alteration, regulations, directives and orders issued by virtue of this Act;

maintenance, and overhaul of aircraft, aircraft engines, propellers and (c) Each holder of an airman certificate to observe and comply with the
appliances; and
authority and limitations of that certificate, the requirements of this Act and
(b) The adequacy and suitability of the equipment, facilities and materials the rules, regulations, directives and orders issued by virtue of this Act;

for, and methods of, repair and overhaul, and the competency of those (d) Every person performing duties in air transportation to observe and
engaged in the work or giving any instruction in accredited maintenance comply with the requirements of this Act and the rules, regulations,
organizations or shops engaged in the repair, alteration, maintenance and directives and orders issued by virtue of this Act; and

overhaul of aircraft engines, propellers and appliances.

(e) Every person who offers or accepts shipments, cargo or baggage in air
commerce to offer or accept such shipments, cargo or baggage in
SEC. 68.  Air Navigation Facility Safety Standards.  - (a) Minimum Safety accordance with the provisions of Annex 18 ofthe Chicago Convention
Standards -The Director General shall have the power to prescribe and revise, from and the ICA0 Technical Instructions for the Safe Transport of Dangerous
time to time as necessary, minimum safety standards for the operation of air Goods by Air.

navigation facilities located in the Philippines.

(b) Certification of Airports - (1) The Director General is empowered to issue airport SEC. 70. Authority to Inspect. - (a) Authority to Inspect Equipment - The Director
certificates to, and to establish minimum safety standards for the operation of, General shall have the power and duty to:

airports that serve any scheduled or unscheduled passenger operations of air

operator or foreign air operator aircraft.
(1) Make such inspections of aircraft, aircraft engines, propellers and
appliances used by an operator of civil aircraft as may be necessary to
(2) Any person desiring to operate an airport that is described in this determine that the operators are maintaining the safe condition for the
section and that is required hy the Director General, by rule, to be certified operation in which they are used; and

may file with the Director General an application for an airport operating (2) Advise each operator in the inspection and maintenance of these items.

certificate. If the Director General finds, after investigation, that such

person is properly and adequately equipped and able to conduct a safe
operation in accordance with the requirements of this Act and the rules
and regulations, and standards prescribed thereunder, the Director
General shall issue an airport operating certificate to such person. Each
airport operating certificate shall prescribe such terms, conditions and
limitations as are reasonably necessary to assure safety in commercial air
transport. Unless the Director General determines that it would be contrary
(b) Unsafe Aircraft, Engines, Propellers and Appliances - When the Director General
finds that any aircraft, aircraft engine, propeller or appliance, used or intended to be
used by any operator in civil aviation, is not in a condition for safe operation, the
Director General shall notify the operator. Such aircraft, aircraft engine, propeller or
appliance then shall not be used in civil aviation or in such manner also to endanger
civil aviation, unless found by the Director General to be in a condition for safe
operation.

to public interest, such terms, conditions and limitations shall include, but
not limited to, terms and conditions, relating to:
SEC. 71.  Amendment, Modifications, Suspension and Revocation of
Certificates.  - (a) Re-inspection and Reexamination - The Director General may,
(i) The operation and maintenance of adequate safety equipment, from time to time, for any reason, reinspect or reexamine any civil aircraft, aircraft
including fire fighting and rescue equipment capable of rapid engine, propeller, appliance, air operator, school, with approved maintenance
access to any portion of the airport used for landing, takeoff, or organization, or any civil airman holding a certificate issued under this Act.

surface maneuvering of aircraft; and

(b) Actions of the Director General - If, as a result of any such re-inspection or
(ii) The condition and maintenance of primary and secondary reexamination, or if, as a result of any other investigation made by the Director
runways as the Director General determines to be necessary.
General, the Director General determines that safety in civil aviation or commercial
air transport and the public interest requires, the Director General may issue an CHAPTER X

order amending, modifying, suspending or revoking, in whole or in part, any OTHER POWERS

airworthiness certificate, airman certificate, air operator certificate or certificate for

any airport, school, or approved maintenance organization issued under this Act.
SEC. 73. Statutory Lien. - The Director General, after complying with the required
(c) Notice to Certificate Holders and Opportunity to Answer - Prior to amending, legal formalities provided by law, shall have the power to impose lien on aircraft and
modifying, suspending or revoking any of the foregoing certificates, the Director machinery:

General shall advise the holder thereof as to any charge or reason relied upon by (a) If the charges and other fees are not paid in full on due date or any part
the Director General for the proposed action and, except in cases of emergency, of the charges or the late payment penalty thereto remains unpaid; and

shall provide the holder of such certificate opportunity to answer any charges and (b) Failure to pay administrative fines arising from violation of any rules and
be heard as to why such certificate should not be amended, modified, suspended regulations promulgated by the Authority.

or revoked.

(d) Appeals - Any person whose certificate is affected by such an order of the SEC. 74. Lien on Personal and Real Properties. - The Director General shall have
Director General under this section may file his motion for reconsideration within the power to impose lien on personal and real properties, and other assets of
five (5) days from receipt thereof and in case of denial shall, within ten (IO) days, file persons, corporations, partnerships, and such other entities that shall be in default,
his appeal to the Board.
or fail to perform their obligations, or fail to pay the fines and other penalties
(e) Effectiveness of Orders Pending Appeal - The filing of motion for reconsideration imposed for violations of the law, rules and regulations of the Authority.

or appeal as provided for under this Act shall not stay the effectiveness of the Properties and assets levied upon may be sold and the proceeds thereof shall be
Director General's order except through an injunctive relief duly issued by a court of applied to the satisfaction of the obligation after due notice and hearing.

competent jurisdiction.

SEC. 75. Police Authority. - The Director General shall have the power to exercise
SEC. 72. Prohibitions. - (a) It shall be unlawful for any person to:
such police authority as may be necessary within the premises of airports under its
(1) Operate in civil aviation any civil aircraft which there is not currently in jurisdiction to carry out its functions and attain its purposes and objectives. The
effect a certificate of airworthiness and registration, or in violation of the grant of such powers shall be in conformity with the functions exclusively provided
terms of any such certificate and operation of the aircraft in a careless and by law to be exercised by the Philippine National Police and other concerned
reckless manner and operation of aircraft in contravention of its approved government agencies:  Provided, That the Authority may request the assistance of
operating limitations and manual;
other law enforcement agencies, including request for deputization as may be
(2) Serve in any capacity as an airman in connection with any civil aircraft, required. Such police authority shall be exercised in connection with the following:

aircraft engine, propeller or appliance used or intended for use in civil

aviation without an airman certificate authorizing that person to serve in (a) Maintenance of security to passengers, cargoes, aircraft, airport
such capacity, or in violation of any term, condition or limitation of his equipment, structures, facilities, personnel, funds and documents;

certificate, or in violation of any order, rule or regulation issued under this (b) Regulating the entry to, exit from and movement within an airport;

Act:
(c) Maintenance of peace and order within the premises of an airport in
(3) Employ for service in connection with any civil aircraft used in civil coordination with local police authorities and other authorized peace-
aviation an airman who does not have an airman certificate authorizing keeping entities within an airport;

that person to serve in the capacity for which the person is employed;
(d) Regulation and supervision of private security agencies operating
(4) Operate as an air operator without an air operator certificate or in within an airport; and

violation of the terms of any such certificate;

(e) Enforcement of rules and regulations promulgated by the Board
(5) Operate aircraft in civil aviation in violation of any rule, regulation, or pursuant to the authority granted under this Act.

certificate issued by the Director General under this Act; and

(6) While holding a certificate issued to a school or approved maintenance SEC. 76.  Regulation of Building Heights.  - The Board shall have the power to
organization as provided in this Act, to violate any term, condition or regulate the height of buildings, towers, antennae, and other edifices, situated
limitation thereof, to violate any order, rule or regulation made under this within the vicinity of or in close proximity to airports estimated to endanger the
Act relating to the holder of such certificate.
flight of aircrafts. It shall also have the power to prohibit or regulate the
establishment and operations of electrical, electronics, sound, magnetic, laser, or
(b) Considering that the aircraft operation is impressed with public interest, the other electronic gadgets, equipment or installations which will tend to interfere with
Director General may prescribe exemptions of the foregoing provisions for foreign or impair air navigation in accordance with the international standards and
aircraft and airmen.
recommended practices on airports, as recommended by the ICAO.

SEC. 77.  Authority Respecting the Transportation of Dangerous Goods by

Air.  - The Director General shall monitor and enforce compliance of the rules and
regulations concerning the carriage of goods by air in relation to Annex 18 of the
Chicago Convention and the ICAO Technical Instructions for the Safe Transport of
Dangerous Goods by Air.
procedures shall be punished by a fine ranging from Twenty thousand
SEC. 78. Development of New Airports. - The Board shall be responsible for the
planning, development, construction, operation, maintenance, or the expansion of
airports. In planning and developing new airports, the Board shall consider:
3rd offense;
(1) Any person who operates any aircraft without the current airworthiness
certificate, in violation of my rule, regulation or order issued by the Director
General relating to aeronautical safety standards or practices or
pesos (Php20,000.00) to Fifty thousand pesos (Php50,000.00) for the
1st  offense, suspension of the license for three (3) months for the
2ndoffense and revocation or cancellation of such license for the

(2) Any person serving in any capacity as an airman in connection with any
(a) The suitability of a proposed site in terms of terrain and proximity to civil aircraft in violation of the terms, conditions or limitations of any such
population center(s);
airman license or certificate, or in excess of the rating of such certificate,
(b) The projected size of the market to be served by a proposed airport;
shall be punished by a fine ranging from Twenty thousand pesos
(c) The ability of a proposed airport to generate sufficient revenue to cover (Php20,000.00) to Fifty thousand pesos (Php50,000.00) for the 1st offense,
costs of operation and maintenance;
suspension of the license for three (3) months for the 2nd  offense and
(d) The availability of funding from both local and foreign sources for the revocation or cancellation of such license for the 3rd offense. The repetition
construction of a new airport or expansion of an existing one;
of this offense shall be sufficient cause for the revocation of the airman's
(e) The proximity of other airports to a proposed new airport and the certificate;

capability of such other airport to handle traffic projected to be handled by
the new proposed airport;
commerce an airman who does not have an airman's certificate
(f) The government's public service obligations, more particularly the
government's duty to ensure the availability of air transport infrastructure
for remote areas far from major population centers and that are not
otherwise easily accessible by transportation via land or sea. In such
cases, the Board shall take reasonable steps to ensure that funding will be
available for the operation and maintenance of such airports;
certificate authorizing it to engage in air carrier operation;
(3) Any person who employs in connection with any aircraft used in air
authorizing him to serve in the capacity for which he is employed shall be
punished by a fine ranging from Fifty thousand pesos (Php50,000.00) to
One hundred thousand pesos (Php100,000.00), as determined by the
Director General in the exercise of his reasonable discretion. A repetition of
the offense shall be sufficient cause for revocation of such person's

(g) ICAO best practices and recommendations concerning the (4) Any person who was issued by the Director General relating to air
development of airports; and
carrier operation, aviation school, aircraft maintenance, and other civil
(h) Such other considerations as the Board, in the exercise of its aviation regulated activity which are being certificated and regulated by
reasonable discretion, may consider relevant or important.
the Director General who have been found to have violated any term,
condition or limitation thereof, or violates any order, rule or regulation
CHAPTER XI
 issued by virtue of this Act relating to the holder of such certificate shall be
PENALTIES
punished by a fine ranging from Three hundred thousand pesos
(Php300,000.00) to Five hundred thousand pesos (Php500,000.00), as
SEC. 79.  Power of the Authority to Investigate Violations.  - Correlative to the determined by the Director General in the exercise of his reasonable
provisions of Section 36 of this Act, the Director General at his own volition, or at discretion. The repetition of this offense shall be sufficient cause for the
the instance of a private person, or upon the initiative of the Board, may conduct revocation of such person's certificate.

investigations based on the procedures that the Board may prescribe and using the (5) No person shall interfere, obstruct, hinder, or delay the Director General
Rules of Court as its suppletory guidelines.
or any person duly delegated by the Director General, in the performance
of his duties pursuant to public interest. A fine ranging from Twenty
SEC. 80.  Power to Direct an Immediate Halt to an Offending Practice.  - The thousand pesos (Php20,000.00) but not exceeding One hundred thousand
Director General, after due investigation conducted, may issue a cease and desist pesos (Php100,000.00), as determined by the Director General in the
order directing an air carrier(s) to immediately cease any practice found to be in exercise of his reasonable discretion, shall be imposed upon anyone who:

violation of the provisions of this Act. Such order shall be without prejudice to the
civil or criminal prosecution of persons or individuals found to be involved in (i) With intent to interfere in the performance of the duties of the
practices prohibited under Chapter XI of this Act.
Director General or any person duly delegated by the Director
General, shall knowingly or willfully alter, falsify, mutilate any
SEC. 81.  Penalties.  - (a) The Director General, after due notice and hearing, is report, accounts, records, books, papers, contracts, agreement
authorized to impose the following fines and penalties for each violation of this Act:
and all other documents; or

 (ii) Shall knowingly and willfully fail or refuse: (a) to make and/or
submit aircraft maintenance or flight logbooks, contracts,
manuals, technical reports and all other documents required to
be submitted by him for consideration before the Director General
or his duly authorized representative; or (b) to keep or preserve
records, reports, papers and all other documents required by the
Director General or his duly authorized representative; or
aircraft material distributorship, air carrier operations or any other civil
(iii) Is guilty of misconduct in the presence of the Director General
or his duly authorized representative, or to any member of the
Board in the performance of their quasi-judicial and quasi-
legislative functions or so near as to obstruct or interrupt the
hearing or session or any proceedings before the Director
General or any of his duly authorized representative; or shall
orally or in writing disrespectfully offend or insult any of the
above-named bodies or persons on the occasion of or in the
performance of their official duties or during any hearing, session,
or investigation held by the Director General or his duly
authorized representative; or
determined by the court;
(iv) Refuses to be sworn in as a witness or to answer as such
when lawfully required to do so:Provided, That the Director
General or his duly authorized representative shall, if necessary,
be entitled to the assistance of law enforcement officials for the
execution of any order to compel a witness to be present or to
testify; or
court; and
(v) Neglects or refuses to attend and/or testify and/or to answer
any lawful inquiry or to produce books, papers or documents, if in
his power to do so, in obedience to the subpoena or lawful
requirement of the Director General or his duly authorized
representative; or
upon any person who:
(vi) Testifies falsely or makes false affidavits or both before the
Director General or his duly authorized representative.
(i) With intent to interfere with air navigation within the Philippines,
(b) The following penalties may only be imposed by a court of competent
jurisdiction after the filing of a proper criminal complaint therein by the Director
General and a finding of guilt:
in connection with an airport or other air navigation facility; or
(1) Any person who operates any aircraft without a valid or current license
or ratings or in violation of rule, regulation or order issued by the Director
General relating to aeronautical safety standards or practices or
procedures shall be punished by imprisonment for not more than three (3)
years or a fine ranging from Fifty thousand pesos (Php50,000.00) but not
exceeding Two hundred thousand pesos (Php200,000.00), or both, at the
discretion of the court;
interferes with their operation shall be subjected to imprisonment from one
(2) Any person who knowingly and willfully forges, counterfeits, alters or
falsifies any certificate or aviation certificate authorized to be issued
pursuant to the provisions of this Act, or knowingly uses or attempts to
use any such fraudulent certificate or aviation certificate, and any person
who knowingly and willfully displays or causes to be displayed on any
aircraft any marks that are false or misleading as to the nationality or
registration of the aircraft shall be punished by imprisonment ranging from
three (3) years to six (6) years or a fine of not less than One hundred
thousand pesos (php100,000.00) but not exceeding Five hundred
thousand pesos (Php500,000.00), or both, as determined by the court;
(3) Any person who shall use for flight operation an unregistered aircraft or
engaged in the operation of aviation school, aircraft maintenance facilities,
aviation regulated activities without the required air agency certificate
issued by the Director General shall be punished by imprisonment ranging
from three (3) years to seven (7) years or a fine of not less than One
hundred thousand pesos (Php100,000.00) but not exceeding Five hundred
thousand pesos (Php500,000.00), or both, as determined by the court;
(4) Any person found guilty of violating the conditions attendant to the
issuance of the airworthiness certificate of the aircraft shall be subjected
to imprisonment ranging from three (3) years to seven (7) years or a fine of
not less than One hundred thousand pesos (Php100,000.00) but not
exceeding Five hundred thousand pesos (Php500,000.00), or both, as
(5) Any person who destroys or seriously damages the facilities of an
airport or disrupts the services of an airport shall be subjected to
imprisonment ranging from one (1) year to three (3) years or a fine of not
less than Fifty thousand pesos (Php50,000.00) but not exceeding Five
hundred thousand pesos (Php500,000.00), or both, as determined by the
(6) No person shall interfere with air navigation. An imprisonment for not
more than three (3) years or a fine of not less than Fifty thousand pesos
(Php50,000.00) but not exceeding Five hundred thousand pesos
(Php500,000.00), or both, as determined by the court, shall be imposed
exhibits within the Philippines any light or signal at such place or
in such manner that it is likely to be mistaken for a true light or
signal established pursuant to this Act or for a true light or signal
(ii) After due warning by the Director General, of his duly
authorized representative, continues to maintain any misleading
light or signal; or
(iii) Knowingly removes, extinguishes, or interferes with the
operation of any true light or signal;
(7) Any person who destroys or damages air navigation facilities or
(1) year to three (3) years or a fine of not less than Fifty thousand pesos
(Php50,000.00) but not exceeding Five hundred thousand pesos
(Php500,000.00), or both, as determined by the court. If such act
endangers the safety of air navigation, the court may impose an increased
penalty of imprisonment from three (3) years to six (6) years or a fine
ranging from Five hundred thousand pesos (Php500,000.00) to One million
pesos (Php1,000,000.00) [Convention for Suppression of Unlawful Acts
Against the Safety of Civil Aviation, signed at Montreal, 23 September
1971, Art. 1(d)];
determined by the court. [Convention on Offenses and Certain Other Acts
(8) Any person who, whether on board or on the ground, communicates
false information to an aircraft and thereby endangering the safety of an
aircraft in flight shall be subjected to imprisonment from one (1) year to
three (3) years or a fine of not less than Fifty thousand pesos
(Php50,000.00) but not exceeding Five hundred thousand pesos
(Php500,000.00), or both, as determined by the court. [Convention for
Suppression of Unlawful Acts Against the Safety of Civil Aviation, signed
at Montreal, 23 September 1971, Art. 1(e)];
exceeding Five hundred thousand pesos (Php500,000.00), or both, as
(9) Any person who, while on board an aircraft, interferes with a
crewmember's or flight attendant's performance of their duties, assaults,
intimidates, or threatens any crewmember or flight attendant, shall be
subjected to imprisonment from one (1) year to three (3) years or a fine of
not less than Fifty thousand pesos (Php50,000.00) but not exceeding Five
hundred thousand pesos (Php500,000.00), or both, as determined by the
court;
(10) Any person who, while on board or while attempting to board, any
aircraft in or intended for operation in commercial air transport, has, on or
about his person or his property, a concealed deadly or dangerous
weapon which is, or would be accessible to such person in flight, or any
person who has on or about his person, or who has placed, or attempted
to place aboard such aircraft any bomb or similar explosive or incendiary
device, shall be subjected to imprisonment from three (3) years to six (6)
years or a fine of not less than One hundred thousand pesos
(Php100,000.00) but not exceeding Five hundred thousand pesos
(Php500,000.00), or both, as determined by the court.
the provisiom of paragraph (b).
This subsection shall not apply to persons duly authorized by the Director
General to carry deadly or dangerous weapons in commercial air transport
nor shall it apply to other persons transporting weapons contained in
baggage that is not accessible to passengers in flight if the presence of
such weapons has been declared to the air carrier and duIy approved by
the proper authority;
(Php20,000.00) to One hundred thousand pesos (Php100,000.00) for each violation.
(11) Any person who imparts or conveys or causes to be imparted or
conveyed false information, knowing the information to be false,
concerning an attempt or alleged attempt being made or to be made to do
an act which would be a crime prohibited by clauses (8), (9) and (10) of this
section, shall be subjected to imprisonment from one (1) year to three (3)
years or a fine of not less than Fifty thousand pesos (Php50,000.00) but
not exceeding Five hundred thousand pesos (Php500,000.00), or both, as
determined by the court. [Convention for Suppression of Unlawful Acts
Against the Safety of Civil Aviation, signed at Montreal, 23 September
1971, Art. 1(e)];
adjust the monetary level of the penalties, as may be authorized by the Board to
(12) Any person who, while on board an aircraft, commits any other act not
otherwise expressly covered under clauses (8), (9), (10) and (11) above
which jeopardizes the safety of the aircraft or of persons or property
therein, or which jeopardizes good order and discipline on board such
aircraft shall be subjected to imprisonment from six (6) months to three (3)
years or a fine of not less than Fifty thousand pesos (Php50,000.00) but
not exceeding Five hundred thousand pesos (Php500,000.00), or both, as
Committed on Board Aircraft, signed at Tokyo, 14 September 1963, Art.
1(b)];
(13) Any person who knowingly and without authority removes, conceals
or withholds any part of an aircraft involved in an aircraft accident or any
property on board such aircraft at the time of th e aircraft accident shall be
subjected to imprisonment from three (3) years to six (6) years or a fine of
not less than One hundred thousand pesos (Php100,000.00) but not
determined by the court: and
(14) Any person who willfully delivers or causes to be delivered to an air
carrier for air transport, or if that person recklessly causes the
transportation in air transport, of any shipment, cargo, baggage or other
property in violation of the provisions of Annex 18 of the Chicago
Convention and the ICAO Technical Instruction for the Safe Transport of
Dangerous Goods by Air, or the corresponding rules and regulations
issued by the Authority shall be subjected to imprisonment from one (1)
year to three (3) years or a fine of not less than One hundred thousand
pesos (Php100,000.00) but not exceeding Five hundred thousand pesos
(Php500,000.00), or both, as determined by the court.
The provisions of paragraph (b), clauses (9), (10), (11) and (12) above shall apply to
any aircraft located within the special jurisdiction of the Philippines. Exercise by the
Director General of the powers granted to him under paragraph (a) above shall not
be a bar to a subsequent criminal prosecution in court for the same act pursuant to
SEC. 82. General Penalty. - Any violation of the provisions of this Act, or any order,
rule or regulation issued thereunder, or any term, condition or limitation of any
certificate or license issued under this Act for which no penalty is expressly
provided shall be punished by a fine ranging from Twenty thousand pesos
SEC. 83.  Penalty Considerations.  - In determining the amount of any such
penalty, the Director General shall take into account the nature, circumstances,
extent and gravity of the violation and, with respect to the person found to have
committed the violation, the degree of culpability, history of prior offenses, ability to
pay, effect on ability to continue to do business, and such other matters as justice
may require.
SEC. 84.  Inflation Adjustment to Civil Penalties.  - The Director General shall
impose, at least once every four (4) years:  Provided, That the Board shall
promulgate such revised penalties in accordance with the Administrative Code of
the Philippines and economic/monetary index provided by the Monetary Board,
including any revision or successor thereto.
CHAPTER XII
 there is an option, the one which the affected employee has
TRANSITORY PROVISIONS
chosen as the most beneficial to him/her: Provided, further, That
for the purpose of complying with the required number of years of
SEC. 85.  Abolition of the Air Transportation Office.  - The Air Transportation service under Republic Act No. 8291, the portability scheme
Office (ATO) created under Republic Act No. 776, a sectoral office of the under Republic Act No. 7699 may be applied, subject to existing
Department of Transportation and Communications (DOTC), is hereby abolished.
policies and guidelines; and

All powers, duties and rights vested by law and exercised by the AT0 is hereby (c) Those with less than three (3) years of government service may opt to
transferred to the Authority.
avail of the separation gratuity under Republic Act No. 6656, plus the
appropriate incentive provided under paragraph (b) of this section.

All assets, real and personal properties, funds and revenues owned by or vested in
the different offices of the AT0 are transferred to the Authority. All contracts, records No affected employee who opted for retirement/separation shall receive less than
and documents relating to the operations of the abolished agency and its offices an aggregate of Fifty thousand pesos (Php50,000.00) as his retirement/separation
and branches are likewise transferred to the Authority. Any real property owned by gratuity from both the national government and the GSIS.

the national government or government-owned corporation or authority which is

being used and utilized as office or facility by the AT0 shall be transferred and titled SEC. 87.  Organization of the Authority.  - Any officer/employee who availed the
in favor of the Authority.
benefits of the foregoing provisions shall not qualify for reemployment to the
Authority within seven (7) years from the date of retirement/resignation.

SEC. 86. Transfer of Personnel of Air Tramportation Office. - To ensure smooth

transition into a corporate structure, the incumbent Assistant Secretary of the AT0 SEC. 88.  Saving Clause.  - Unless otherwise provided in this Act, rights or
shall continue to hold office and assume the powers of the Director General until his privileges vested or acquired under the provisions of Republic Act No. 776, as
successor shall have been appointed and inducted into office in accordance with amended, its rules and regulations prior to the effectivity of this Act shall remain in
this Act. However, affected officials and personnel, with appointments attested by full force and effect.

the Civil Service Commission, whether hired on a permanent or temporary basis,

who would opt to retire or to be separated from the service, and those hired on a SEC. 89. Legal Counsel. - The Office of the Government Corporate Counsel shall
casual or contractual basis, if qualified, shall be given the option to avail themselves act as the external legal counsel of the Authority before any court of law or any
of any of the following, whichever is beneficial to them:
quasi-judicial bodies of the government without prejudice of any deputation or
(a) Retirement gratuity provided under Republic Act No. 1616, as designation that it may issue in favor of the in-house counsel of the Authority.

amended, plus the refund of retirement premiums payable by the

Government Service Insurance System (GSIS), without the incentive herein SEC. 90. Implementing Rules and Regulations. - The Authority shall adopt rules
provided;
and regulations to implement the provisions of this Act within sixty (60) days from
(b) Retirement benefit under Republic Act No. 660 or applicable retirement, the date of its approval.

separation or unemployment benefit provided under Republic Act No.

8291, if qualified, plus the following applicable incentives:
SEC. 91.  Congressional Oversight Committee.  - A Congressional Oversight
Committee, hereinafter referred to as the "Committee", is hereby constituted in
(1) One half (1/2) month of the present basic salary for every year accordance with the provisions of this Act. The Committee shall be composed of
of government service and a fraction thereof, for those who have the Chairman of the Senate Committee on Public Services and Chairman of the
rendered twenty (20) years of service and below;
House Committee on Transportation and four (4) additional members from each
(2) Three-fourth (3/4) month of the present basic salary for every House to be designated by the Senate President and the Speaker of the House of
year of government service and a fraction thereof, computed Representatives, respectively. The Committee shall, among others, in aid of
starting from the 1st  year, for those who have rendered twenty- legislation:

one (21) to thirty (30) years of service; and

(3) One (1) month of the present basic salary for every year of (a) Monitor and ensure the proper implementation of this Act;

government service and a fraction thereof, computed starting (b) Review the collection performance of the Authority;

from the lst year, for those who have rendered thirty-one (31) years (c) Review the proper implementation of the programs of the Authority and
of service and above:  Provided, That the GSIS shall pay, on the the use of its collected fund.

day of separation, the retirement/separation/unemployment

benefits to which an affected employee may be entitled to under In furtherance of the hereinabove cited ohjectives, the Committee is empowered to
Republic Act No. 660 or Republic Act No. 8291 and whenever require the Authority to submit all pertinent information including, but not limited to,
its collection performance data and its annual audited financial statements certified
by the Commission on Audit.

The Congressional Oversight Committee shall be in existence for a period of five (5)
years, and thereafter, its oversight functions shall be exercised by the Senate
Committee on Public Services and the House Committee on Transportation acting
separately.

SEC. 92. Separability Clause. - If any part or provision of this Act shall be declared
unconstitutional, the other parts or provisions hereof which are not affected thereby,
shall continue in full force and effect.

SEC. 93.  Repealing Clause.  - All laws, decrees, executive orders, rules and
regulations or parts thereof inconsistent with the provisions of this Act are hereby
repealed or modified accordingly, including provisions of any law, decrees,
executive orders, rules and regulations or part thereof which provides exemptions
to any air carrier, organization or entity from payment of any Civil Aviation Authority
of the Philippines imposed fees and charges, relating to, but not limited to,
navigation, communication, concession, license and permit.

Notwithstanding the foregoing, nothing in this Act shall diminish the powers and
functions of the Manila International Airport Authority created by virtue of Executive
Order No. 903, series of 1983; Subic Bay Metropolitan Authority as regards the
Subic Bay International Airport created by virtue of Republic Act No. 7227; Clark
International Airport Corporation as regards the Diosdado Macapagal International
Airport Authority, created by virtue of Executive Order No. 193, series of 2003; and
the Mactan-Cebu International Airport Authority created by virtue of Republic Act
No. 6958.

SEC. 94. Effectivity. - This Act shall take effect fifteen (15) days after its complete
publication in at least newspapers of general circulation.

Convention on International Civil Aviation (ICAO Convention) Article 3

Civil and state aircraft

Whereas the future development of international civil aviation can greatly help to
a. This Convention shall be applicable only to civil aircraft, and shall not be
create and preserve friendship and understanding among the nations and peoples
applicable to state aircraft.
of the world, yet its abuse can become a threat to the general security; and

b. Aircraft used in military, customs and police services shall be deemed to

Whereas it is desirable to avoid friction and to promote that cooperation between be state aircraft.
nations and peoples upon which the peace of the world depends;

c. No state aircraft of a contracting State shall fly over the territory of another
Therefore, the undersigned governments having agreed on certain principles and State or land thereon without authorization by special agreement or
arrangements in order that international civil aviation may be developed in a safe otherwise, and in accordance with the terms thereof.
and orderly manner and that international air transport services may be established
on the basis of equality of opportunity and operated soundly and economically;
d. The contracting States undertake, when issuing regulations for their state
aircraft, that they will have due regard for the safety of navigation of civil
Have accordingly concluded this Convention to that end.
aircraft.

Part I - Air navigation

Article 3bis[1]

Chapter I - General principles and application of the Convention

a. The contracting States recognize that every State must refrain from resorting to the
Article 1
use of weapons against civil aircraft in flight and that, in case of interception, the
Sovereignty lives of persons on board and the safety of aircraft must not be endangered. This
provision shall not be interpreted as modifying in any way the rights and obligations
The contracting States recognize that every State has complete and exclusive of States set forth in the Charter of the United Nations.
sovereignty over the airspace above its territory.

b. The contracting States recognize that every State, in the exercise of its sovereignty,
is entitled to require the landing at some designated airport of a civil aircraft flying
Article 2

above its territory without authority or if there are reasonable grounds to conclude
Territory that it is being used for any purpose inconsistent with the aims of this Convention;
it may also give such aircraft any other instructions to put an end to such violations.
For the purposes of this Convention the territory of a State shall be deemed to be For this purpose, the contracting States may resort to any appropriate means
the land areas and territorial waters adjacent thereto under the sovereignty, consistent with relevant rules of international law, including the relevant provisions
suzerainty, protection or mandate of such State.
of this Convention, specifically paragraph a) of this Article. Each contracting State
agrees to publish its regulations in force regarding the interception of civil aircraft.

c. Every civil aircraft shall comply with an order given in conformity with paragraph b)
of this Article. To this end each contracting State shall establish all necessary
provisions in its national laws or regulations to make such compliance mandatory
for any civil aircraft registered in that State or operated by an operator who has his
principal place of business or permanent residence in that State. Each contracting
State shall make any violation of such applicable laws or regulations punishable by
severe penalties and shall submit the case to its competent authorities in
accordance with its laws or regulations.

d. Each contracting State shall take appropriate measures to prohibit the deliberate
use of any civil aircraft registered in that State or operated by an operator who has
his principal place of business or permanent residence in that State for any
purpose inconsistent with the aims of this Convention. This provision shall not
affect paragraph a) or derogate from paragraphs b) and c) of this Article.
 [1] Added by amendment 1984-05-10, entered into force 1998-10-01.
Article 8

Article 4
Pilotless aircraft
Misuse of civil aviation
No aircraft capable of being flown without a pilot shall be flown without a pilot over
Each contracting State agrees not to use civil aviation for any purpose inconsistent the territory of a contracting State without special authorization by that State and in
with the aims of this Convention.
accordance with the terms of such authorization. Each contracting State
undertakes to insure that the flight of such aircraft without a pilot in regions open to
Chapter II - Flight over territory of Contracting States
civil aircraft shall be so controlled as to obviate danger to civil aircraft.

Article 5
Article 9

Right of non-scheduled flight

Prohibited areas
Each contracting State agrees that all aircraft of the other contracting States, being
a. Each contracting State may, for reasons of military necessity or public
aircraft not engaged in scheduled international air services shall have the right,
safety, restrict or prohibit uniformly the aircraft of other States from flying
subject to the observance of the terms of this Convention, to make flights into or in
over certain areas of its territory, provided that no distinction in this
transit non-stop across its territory and to make stops for non-traffic purposes
respect is made between the aircraft of the State whose territory is
without the necessity of obtaining prior permission, and subject to the right of the
involved, engaged in international scheduled airline services, and the
State flown over to require landing. Each contracting State nevertheless reserves
aircraft of the other contracting States likewise engaged. Such prohibited
the right, for reasons of safety of flight, to require aircraft desiring to proceed over
areas shall be of reasonable extent and location so as not to interfere
regions which are inaccessible or without adequate air navigation facilities to follow
unnecessarily with air navigation. Descriptions of such prohibited areas in
prescribed routes, or to obtain special permission for such flights.

the territory of a contracting State, as well as any subsequent alterations

therein, shall be communicated as soon as possible to the other
Such aircraft, if engaged in the carriage of passengers, cargo, or mail for
contracting States and to the International Civil Aviation Organization.
remuneration or hire on other than scheduled international air services, shall also,
subject to the provisions of Article 7, have the privilege of taking on or discharging b. Each contracting State reserves also the right, in exceptional
passengers, cargo, or mail, subject to the right of any State where such circumstances or during a period of emergency, or in the interest of public
embarkation or discharge takes place to impose such regulations, conditions or safety, and with immediate effect, temporarily to restrict or prohibit flying
limitations as it may consider desirable.
over the whole or any part of its territory, on condition that such restriction
or prohibition shall be applicable without distinction of nationality to
Article 6
aircraft of all other States.
Scheduled air services
c. Each contracting State, under such regulations as it may prescribe, may
No scheduled international air service may be operated over or into the territory of require any aircraft entering the areas contemplated in subparagraphs (a)
a contracting State, except with the special permission or other authorization of or (b) above to effect a landing as soon as practicable thereafter at some
that State, and in accordance with the terms of such permission or authorization.
designated airport within its territory.

Article 7

Article 10

Cabotage
Landing at customs airport
Each contracting State shall have the right to refuse permission to the aircraft of
other contracting States to take on in its territory passengers, mail and cargo
Except in a case where, under the terms of this Convention or a special
carried for remuneration or hire and destined for another point within its territory.
authorization, aircraft are permitted to cross the territory of a contracting State
Each contracting State undertakes not to enter into any arrangements which
without landing, every aircraft which enters the territory of a contracting State shall,
specifically grant any such privilege on an exclusive basis to any other State or an
if the regulations of that State so require, land at an airport designated by that State
airline of any other State, and not to obtain any such exclusive privilege from any
for the purpose of customs and other examination. On departure from the territory
other State.

of a contracting State, such aircraft shall depart from a similarly designated

customs airport. Particulars of all designated customs airports shall be published
by the State and transmitted to the International Civil Aviation Organization
established under Part 11 of this Convention for communication to all other
contracting States.
Airport and similar charges
Article 11
Every airport in a contracting State which is open to public use by its national
Applicability of air regulations
Subject to the provisions of this Convention, the laws and regulations of a
contracting State relating to the admission to or departure from its territory of
aircraft engaged in international air navigation, or to the operation and navigation of
such aircraft while within its territory, shall be applied to the aircraft of all
contracting States without distinction as to nationality, and shall be complied with
by such aircraft upon entering or departing from or while within the territory of that
State.
Article 12
Rules of the air
Each contracting State undertakes to adopt measures to insure that every aircraft
flying over or maneuvering within its territory and that every aircraft carrying its
nationality mark, wherever such aircraft may be, shall comply with the rules and
regulations relating to the flight and maneuver of aircraft there in force. Each
contracting State undertakes to keep its own regulations in these respects uniform,
to the greatest possible extent, with those established from time to time under this
Convention. Over the high seas, the rules in force shall be those established under
this Convention. Each contracting State undertakes to insure the prosecution of all
persons violating the regulations applicable.
No fees, dues or other charges shall be imposed by any contracting State in
Article 13
aircraft of a contracting State or persons or property thereon.
Entry and clearance regulations
The laws and regulations of a contracting State as to the admission to or departure
from its territory of passengers, crew or cargo of aircraft, such as regulations
relating to entry, clearance, immigration, passports, customs, and quarantine shall
be complied with by or on behalf of such passengers, crew or cargo upon entrance
into or departure from, or while within the territory of that State.
landing or departure, and to inspect the certificates and other documents
Article 14
Prevention of spread of disease
Each contracting State agrees to take effective measures to prevent the spread by
means of air navigation of cholera, typhus (epidemic), smallpox, yellow fever,
plague, and such other communicable diseases as the contracting States shall
from time to time decide to designate, and to that end contracting States will keep
in close consultation with the agencies concerned with international regulations
relating to sanitary measures applicable to aircraft. Such consultation shall be
without prejudice to the application of any existing international convention on this
subject to which the contracting States may be parties.
Article 15
aircraft shall likewise, subject to the provisions of Article 68, be open under uniform
conditions to the aircraft of all the other contracting States. The like uniform
conditions shall apply to the use, by aircraft of every contracting State, of all air
navigation facilities, including radio and meteorological services, which may be
provided for public use for the safety and expedition of air navigation. Any charges
that may be imposed or permitted to be imposed by a contracting State for the use
of such airports and air navigation facilities by the aircraft of any other contracting
State shall not be higher,
a. As to aircraft not engaged in scheduled international air services, than
those that would be paid by its national aircraft of the same class
engaged in similar operations, and
b. As to aircraft engaged in scheduled international air services, than those
that would be paid by its national aircraft engaged in similar international
air services.
All such charges shall be published and communicated to the International Civil
Aviation Organization, provided that, upon representation by an interested
contracting State, the charges imposed for the use of airports and other facilities
shall be subject to review by the Council, which shall report and make
recommendations thereon for the consideration of the State or States concerned.
respect solely of the right of transit over or entry into or exit from its territory of any
Article 16
Search of aircraft
The appropriate authorities of each of the contracting States shall have the right,
without unreasonable delay, to search aircraft of the other contracting States on
prescribed by this Convention.
Chapter III - Nationality of aircraft
Article 17
Nationality of aircraft
Aircraft have the nationality of the State in which they are registered.
Article 18
Dual registration

An aircraft cannot be validly registered in more than one State, but its registration
may be changed from one State to another.
Article 24

Customs duty
Article 19

a. Aircraft on a flight to, from, or across the territory of another contracting State shall
National laws governing registration be admitted temporarily free of duty, subject to the customs regulations of the
State. Fuel, lubricating oils, spare parts, regular equipment and aircraft stores on
The registration or transfer of registration of aircraft in any contracting State shall be board an aircraft of a contracting State, on arrival in the territory of another
made in accordance with its laws and regulations.
contracting State and retained on board on leaving the territory of that State shall
be exempt from customs duty, inspection fees or similar national or local duties and
Article 20
charges. This exemption shall not apply to any quantities or articles unloaded,
Display of marks except in accordance with the customs regulations of the State, which may require
that they shall be kept under customs supervision.
Every aircraft engaged in international air navigation shall bear its appropriate
b. Spare parts and equipment imported into the territory of a contracting State for
nationality and registration marks.
incorporation in or use on an aircraft of another contracting State engaged in
international air navigation shall be admitted free of customs duty, subject to
Article 21
compliance with the regulations of the State concerned, which may provide that the
Report of registrations articles shall be kept under customs supervision and control.

Article 25

Each contracting State undertakes to supply to any other contracting State or to

Aircraft in distress
the International Civil Aviation Organization, on demand, information concerning the
registration and ownership of any particular aircraft registered in that State. In
Each contracting State undertakes to provide such measures of assistance to
addition, each contracting State shall furnish reports to the International Civil
aircraft in distress in its territory as it may find practicable, and to permit, subject to
Aviation Organization, under such regulations as the latter may prescribe, giving
control by its own authorities, the owners of the aircraft or authorities of the State in
such pertinent data as can be made available concerning the ownership and
which the aircraft is registered to provide such measures of assistance as may be
control of aircraft registered in that State and habitually engaged in international air
necessitated by the circumstances. Each contracting State, when undertaking
navigation. The data thus obtained by the International Civil Aviation Organization
search for missing aircraft, will collaborate in coordinated measures which may be
shall be made available by it on request to the other contracting States.

recommended from time to time pursuant to this Convention.

Chapter IV - Measures to facilitate air navigation

Article 26

Investigation of accidents
Article 22

Facilitation of formalities
In the event of an accident to an aircraft of a contracting State occurring in the
territory of another contracting State, and involving death or serious injury, or
Each contracting State agrees to adopt all practicable measures, through the
indicating serious technical defect in the aircraft or air navigation facilities, the State
issuance of special regulations or otherwise, to facilitate and expedite navigation by
in which the accident occurs will institute an inquiry into the circumstances of the
aircraft between the territories of contracting States, and to prevent unnecessary
accident, in accordance, so far as its laws permit, with the procedure which may be
delays to aircraft, crews, passengers and cargo, especially in the administration of
recommended by the International Civil Aviation Organization. The State in which
the laws relating to immigration, quarantine, customs and clearance.

the aircraft is registered shall be given the opportunity to appoint observers to be

present at the inquiry and the State holding the inquiry shall communicate the
Article 23

report and findings in the matter to that State.

Customs and immigration procedures

Each contracting State undertakes, so far as it may find practicable, to establish

customs and immigration procedures affecting international air navigation in
accordance with the practices which may be established or recommended from
time to time, pursuant to this Convention. Nothing in this Convention shall be
construed as preventing the establishment of customs-free airports.

 Every aircraft of a contracting State, engaged in international navigation, shall carry

Article 27
the following documents in conformity with the conditions prescribed in this
Exemption from seizure on patent claims Convention:

a. While engaged in international air navigation, any authorized entry of aircraft of a a. Its certificate of registration;
contracting State into the territory of another contracting State or authorized transit
across the territory of such State with or without landings shall not entail any b. Its certificate of airworthiness;
seizure or detention of the aircraft or any claim against the owner or operator
thereof or any other interference therewith by or on behalf of such State or any c. The appropriate licenses for each member of the crew;
person therein, on the ground that the construction, mechanism, parts, accessories
or operation of the aircraft is an infringement of any patent, design, or model duly d. Its journey log book;
granted or registered in the State whose territory is entered by the aircraft, it being
e. If it is equipped with radio apparatus, the aircraft radio station license;
agreed that no deposit of security in connection with the foregoing exemption from
seizure or detention of the aircraft shall in any case be required in the State entered
f. If it carries passengers, a list of their names and places of embarkation
by such aircraft.
and destination;
b. The provisions of paragraph (a) of this Article shall also be applicable to the storage
g. If it carries cargo, a manifest and detailed declarations of the cargo.
of spare parts and spare equipment for the aircraft and the right to use and install
the same in the repair of an aircraft of a contracting State in the territory of any Article 30

other contracting State, provided that any patented part or equipment so stored
shall not be sold or distributed internally in or exported commercially from the
contracting State entered by the aircraft.
c. The benefits of this Article shall apply only to such States, parties to this
Convention, as either (1) are parties to the International Convention for the
Protection of Industrial Property and to any amendments thereof; or (2) have
enacted patent laws which recognize and give adequate protection to inventions
made by the nationals of the other States parties to this Convention.
Article 28
authorities of the State in which the aircraft is registered.
Air navigation facilities and standard systems
Aircraft radio equipment
a. Aircraft of each contracting State may, in or over the territory of other contracting
States, carry radio transmitting apparatus only if a license to install and operate
such apparatus has been issued by the appropriate authorities of the State in which
the aircraft is registered. The use of radio transmitting apparatus in the territory of
the contracting State whose territory is flown over shall be in accordance with the
regulations prescribed by that State.
b. Radio transmitting apparatus may be used only by members of the flight crew who
are provided with a special license for the purpose, issued by the appropriate
Article 31

Each contracting State undertakes, so far as it may find practicable, to:

Certificates of airworthiness

a. Provide, in its territory, airports, radio services, meteorological services and other Every aircraft engaged in international navigation shall be provided with a certificate
air navigation facilities to facilitate international air navigation, in accordance with of airworthiness issued or rendered valid by the State in which it is registered.

the standards and practices recommended or established from time to time,

pursuant to this Convention;
Article 32

b. Adopt and put into operation the appropriate standard systems of communications
procedure, codes, markings, signals, lighting and other operational practices and
rules which may be recommended or established from time to time, pursuant to
this Convention;
c. Collaborate in international measures to secure the publication of aeronautical
maps and charts in accordance with standards which may be recommended or
established from time to time, pursuant to this Convention.
Chapter V - Conditions to be fulfilled with respect to aircraft
any of its nationals by another contracting State.
Licenses of personnel
a. The pilot of every aircraft and the other members of the operating crew of every
aircraft engaged in international navigation shall be provided with certificates of
competency and licenses issued or rendered valid by the State in which the aircraft
is registered.
Each contracting State reserves the right to refuse to recognize, for the purpose of
b.
flight above its own territory, certificates of competency and licenses granted to

Article 33

Article 29
Recognition of certificates and licenses
Documents carried in aircraft
Certificates of airworthiness and certificates of competency and licenses issued or To this end the International Civil Aviation Organization shall adopt and amend from
rendered valid by the contracting State in which the aircraft is registered, shall be time to time, as may be necessary, international standards and recommended
recognized as valid by the other contracting States, provided that the requirements practices and procedures dealing with:

under which such certificates or licenses were issued or rendered valid are equal to
a. Communications systems and air navigation aids, including ground marking;
or above the minimum standards which may be established from time to time
pursuant to this Convention.
b. Characteristics of airports and landing areas;

Article 34
c. Rules of the air and air traffic control practices;
Journey log books
d. Licensing of operating and mechanical personnel;
There shall be maintained in respect of every aircraft engaged in international e. Airworthiness of aircraft;
navigation a journey log book in which shall be entered particulars of the aircraft, its
crew and of each journey, in such form as may be prescribed from time to time f. Registration and identification of aircraft;
pursuant to this Convention.

g. Collection and exchange of meteorological information;

Article 35

h. Log books;
Cargo restrictions
a. No munitions of war or implements of war may be carried in or above the territory i. Aeronautical maps and charts;
of a State in aircraft engaged in international navigation, except by permission of
such State. Each State shall determine by regulations what constitutes munitions of j. Customs and immigration procedures;
war or implements of war for the purposes of this Article, giving due consideration,
k. Aircraft in distress and investigation of accidents;
for the purposes of uniformity, to such recommendations as the International Civil
Aviation Organization may from time to time make. and such other matters concerned with the safety, regularity, and efficiency of air
navigation as may from time to time appear appropriate.

b. Each contracting State reserves the right, for reasons of public order and safety, to
regulate or prohibit the carriage in or above its territory of articles other than those
enumerated in paragraph (a): provided that no distinction is made in this respect Article 38

between its national aircraft engaged in international navigation and the aircraft of Departures from international standards and procedures
the other States so engaged; and provided further that no restriction shall be
imposed which may interfere with the carriage and use on aircraft of apparatus Any State which finds it impracticable to comply in all respects with any such
necessary for the operation or navigation of the aircraft or the safety of the international standard or procedure, or to bring its own regulations or practices into
personnel or passengers. full accord with any international standard or procedure after amendment of the
latter, or which deems it necessary to adopt regulations or practices differing in any
Article 36
particular respect from those established by an international standard, shall give
Photographic apparatus immediate notification to the International Civil Aviation Organization of the
differences between its own practice and that established by the international
Each contracting State may prohibit or regulate the use of photographic apparatus standard. In the case of amendments to international standards, any State which
in aircraft over its territory.
does not make the appropriate amendments to its own regulations or practices
shall give notice to the Council within sixty days of the adoption of the amendment
Chapter VI - International standards and recommended practices
to the international standard, or indicate the action which it proposes to take. In any
such case, the Council shall make immediate notification to all other states of the
Article 37
difference which exists between one or more features of an international standard
Adoption of international standards and procedures and the corresponding national practice of that State.

Each contracting State undertakes to collaborate in securing the highest

practicable degree of uniformity in regulations, standards, procedures, and
organization in relation to aircraft, personnel, airways and auxiliary services in all
matters in which such uniformity will facilitate and improve air navigation.

Article 39
Article 44

Endorsement of certificates and licenses

a. Any aircraft or part thereof with respect to which there exists an international
standard of airworthiness or performance, and which failed in any respect to satisfy
that standard at the time of its certification, shall have endorsed on or attached to
its airworthiness certificate a complete enumeration of the details in respect of
Objectives
The aims and objectives of the Organization are to develop the principles and
techniques of international air navigation and to foster the planning and
development of international air transport so as to:

which it so failed. a. Insure the safe and orderly growth of international civil aviation throughout the
world;
b. Any person holding a license who does not satisfy in full the conditions laid down in
the international standard relating to the class of license or certificate which he b. Encourage the arts of aircraft design and operation for peaceful purposes;
holds shall have endorsed on or attached to his license a complete enumeration of
the particulars in which he does not satisfy such conditions. c. Encourage the development of airways, airports, and air navigation facilities for
international civil aviation;
Article 40

d. Meet the needs of the peoples of the world for safe, regular, efficient and
Validity of endorsed certificates and licenses economical air transport;

No aircraft or personnel having certificates or licenses so endorsed shall participate e. Prevent economic waste caused by unreasonable competition;
in international navigation, except with the permission of the State or States whose
territory is entered. The registration or use of any such aircraft, or of any certificated f. Insure that the rights of contracting States are fully respected and that every
contracting State has a fair opportunity to operate international airlines;
aircraft part, in any State other than that in which it was originally certificated shall
be at the discretion of the State into which the aircraft or part is imported.
g. Avoid discrimination between contracting States;

Article 41
h. Promote safety of flight in international air navigation;
Recognition of existing standards of airworthiness
i. Promote generally the development of all aspects of international civil aeronautics.
The provisions of this Chapter shall not apply to aircraft and aircraft equipment of
types of which the prototype is submitted to the appropriate national authorities for Article 45

certification prior to a date three years after the date of adoption of an international Permanent seat[1]
standard of airworthiness for such equipment.

The permanent seat of the Organization shall be at such place as shall be

Article 42
determined at the final meeting of the Interim Assembly of the Provisional
Recognition of existing standards of competency of personnel International Civil Aviation Organization set up by the Interim Agreement on
International Civil Aviation signed at Chicago on December 7, 1944. The seat may
The provisions of this Chapter shall not apply to personnel whose licenses are be temporarily transferred elsewhere by decision of the Council, and otherwise than
originally issued prior to a date one year after initial adoption of an international temporarily by decision of the Assembly, such decision to be taken by the number
standard of qualification for such personnel; but they shall in any case apply to all of votes specified by the Assembly. The number of votes so specified will not be
personnel whose licenses remain valid five years after the date of adoption of such less than three-fifths of the total number of contracting States.

standard.

[1] Amended 14 June 1954-06-14, entered into force on 1958-05-16.

Part II - The International Civil Aviation Organization
Article 46

Chapter VII - The Organization

First meeting of Assembly

Article 43
The first meeting of the Assembly shall be summoned by the Interim Council of the
Name and composition above-mentioned Provisional Organization as soon as the Convention has come
into force, to meet at a time and place to be decided by the Interim Council.

An organization to be named the international Civil Aviation Organization is formed

by the Convention. it is made up of an Assembly, a Council, and such other bodies
as may be necessary.

 g. Refer, at its discretion, to the Council, to subsidiary commissions, or to any other

Article 47
body any matter within its sphere of action;
Legal capacity
h. Delegate to the Council the powers and authority necessary or desirable for the
The Organization shall enjoy in the territory of each contracting State such legal discharge of the duties of the Organization and revoke or modify the delegations of
capacity as may be necessary for the performance of its functions. Full juridical authority at any time;
personality shall be granted wherever compatible with the constitution and laws of
i. Carry out the appropriate provisions of Chapter XIII;
the State concerned.

j. Consider proposals for the modification or amendment of the provisions of this

Chapter VIII - The Assembly
Convention and, if it approves of the proposals, recommend them to the
contracting States in accordance with the provisions of Chapter XXI;
Article 48

Meetings of Assembly and voting k. Deal with any matter within the sphere of action of the Organization not specifically
assigned to the Council.
a. The Assembly shall meet not less than once in three years and shall be convened
by the Council at a suitable time and place. An extraordinary meeting of the [1] Amended 1954-06-14, entered into force 1956-12-12.
Assembly may be held at any time upon the call of the Council or at the request of
not less than one-fifth of the total number of contracting States addressed to the Chapter IX - The Council

Secretary General.[1]
Article 50

b. All contracting States shall have an equal right to be represented at the meetings of Composition and election of Council
the Assembly and each contracting State shall be entitled to one vote. Delegates
representing contracting States may be assisted by technical advisers who may a. The Council shall be a permanent body responsible to the Assembly. It shall be
participate in the meetings but shall have no vote. composed of thirty-six contracting States elected by the Assembly. An election
shall be held at the first meeting of the Assembly and thereafter every three years,
c. A majority of the contracting States is required to constitute a quorum for the and the members of the Council so elected shall hold office until the next following
meetings of the Assembly. Unless otherwise provided in this Convention, decisions election.[1]
of the Assembly shall be taken by a majority of the votes cast.
b. In electing the members of tile Council, the Assembly shall give adequate
[1] Amended 1954-06-14, entered into force 1956-12-12; and 1962-09-15, representation to (1) the States of chief importance in air transport; (2) the States
entered into force 1975-09-11. not otherwise included which make the largest contribution to the provision of
facilities for international civil air navigation; and (3) the States not otherwise
Article 49
included whose designation will insure that all the major geographic areas of the
Powers and duties of Assembly world are represented on tile Council. Any vacancy on the Council shall be filled by
the Assembly as soon as possible; any contracting State so elected to the Council
The powers and duties of the Assembly shall be to:
shall hold office for the unexpired portion of its predecessor's term of office.

a. Elect at each meeting its President and other officers; c. No representative of a contracting State on the Council shall be actively associated
with the operation of an international air service or financially interested in such a
b. Elect the contracting States to be represented on the Council, in accordance with service.
the provisions of Chapter IX;
[1] Amended 1961-06-21, entered into force 1962-07-17; amended
c. Examine and take appropriate action on the reports of the Council and decide on
1971-03-12, entered into force 1973-01-16; amended 1974-10-16,
any matter referred to it by the Council;
entered into force 1980-02-15; and amended 1990-10-26, entered into
d. Determine its own rules of procedure and establish such subsidiary commissions force 2002-11-28.
as it may consider to be necessary or desirable;
Article 51

e. Vote annual budgets and determine the financial arrangements of the Organization,
in accordance with the provisions of Chapter XII;[1] President of Council

f. Review expenditures and approve the accounts of the Organization; The Council shall elect its President for a term of three years. He may be reelected.
He shall have no vote. The Council shall elect from among its members one or more
Vice Presidents who shall retain their right to vote when serving as acting President.
The President need not be selected from among the representatives of the h. Appoint a chief executive officer who shall be called the Secretary General, and
members of the Council but, if a representative is elected, his seat shall be deemed make provision for the appointment of such other personnel as may be necessary,
vacant and it shall be filled by the State which he represented. The duties of the in accordance with the provisions of Chapter XI;
President shall be to:

i. Request, collect, examine and publish information relating to the advancement of

a. Convene meetings of the Council, the Air Transport Committee, and the air navigation and the operation of international air services, including information
Air Navigation Commission; about the costs of operation and particulars of subsidies paid to airlines from
public funds;
b. Serve as representative of the Council; and
j. Report to contracting States any infraction of this Convention, as well as any
c. Carry out on behalf of the Council the functions which the Council assigns
failure to carry out recommendations or determinations of the Council;
to him.
k. Report to the Assembly any infraction of this Convention where a contracting State
Article 52

has failed to take appropriate action within a reasonable time after notice of the
Voting in Council
infraction;

Decisions by the Council shall require approval by a majority of its members. The
Council may delegate authority with respect to any particular matter to a committee
of its members. Decisions of any committee of the Council may be appealed to the
Council by any interested contracting State,
taken;
l. Adopt, in accordance with the provisions of Chapter VI of this Convention,
international standards and recommended practices; for convenience, designate
them as Annexes to this Convention; and notify all contracting States of the action

m. Consider recommendations of the Air Navigation Commission for amendment of

Article 53

the Annexes and take action in accordance with the provisions of Chapter XX;
Participation without a vote
n. Consider any matter relating to the Convention which any contracting State refers
Any contracting State may participate, without a vote, in the consideration by the to it.
Council and by its committees and commissions of any question which especially
affects its interests. No member of the Council shall vote in the consideration by the Article 55

Council of a dispute to which it is a party.

Permissive functions of Council

Article 54
The Council may:

Mandatory functions of Council a. Where appropriate and as experience may show to be desirable, create
subordinate air transport commissions on a regional or other basis and define
The Council shall:
groups of states or airlines with or through which it may deal to facilitate the
carrying out of the aims of this Convention;
a. Submit annual reports to the Assembly;
b. Delegate to the Air Navigation Commission duties additional to those set forth in
b. Carry out the directions of the Assembly and discharge the duties and obligations the Convention and revoke or modify such delegations of authority at any time;
which are laid on it by this Convention;
c. Conduct research into all aspects of air transport and air navigation which are of
c. Determine its organization and rules of procedure; international importance, communicate the results of its research to the contracting
States, and facilitate the exchange of information between contracting States on air
d. Appoint and define the duties of an Air Transport Committee, which shall be
transport and air navigation matters;
chosen from among the representatives of the members of the Council, and which
shall be responsible to it; d. Study any matters affecting the organization and operation of international air
transport, including the international ownership and operation of international air
e. Establish an Air Navigation Commission, in accordance with the provisions of
services on trunk routes, and submit to the Assembly plans in relation thereto;
Chapter X;
e. Investigate, at the request of any contracting State, any situation which may appear
f. Administer the finances of the Organization in accordance with the provisions of
to present avoidable obstacles to the development of international air navigation;
Chapters XII and XV;
and, after such investigation, issue such reports as may appear to it desirable.
g. Determine the emoluments of the President of the Council;
 to respect the international character of the responsibilities of the personnel and
Chapter X - The Air Navigation Commission
not to seek to influence any of its nationals in the discharge of their responsibilities.

Article 56
Article 60

Nomination and appointment of Commission Immunities and privileges of personnel

The Air Navigation Commission shall be composed of nineteen members appointed
by the Council from among persons nominated by contracting States. These
persons shall have suitable qualifications and experience in the science and
practice of aeronautics. The Council shall request all contracting States to submit
nominations. The President of the Air Navigation Commission shall be appointed by
the Council.[1]
civil servants is arrived at, the immunities and privileges accorded to the President,
[1] Amended 1971-07-07, entered into force 1974-12-19; and amended
1989-10-06, entered into force 2005-04-18.
Each contracting State undertakes, so far as possible under its constitutional
procedure, to accord to the President of the Council, the Secretary General, and
the other personnel of the Organization, the immunities and privileges which are
accorded to corresponding personnel of other public international organizations. If
a general international agreement on the immunities and privileges of international
the Secretary General, and the other personnel of the Organization shall be the
immunities and privileges accorded under that general international agreement.

Chapter XII - Finance

Article 57

Duties of Commission Article 61

Budget and apportionment of expenses

The Air Navigation Commission shall:

a. Consider, and recommend to the Council for adoption, modifications of The Council shall submit to the Assembly annual budgets, annual statements of
the Annexes to this Convention; accounts and estimates of all receipts and expenditures. The Assembly shall vote
the budgets with whatever modification it sees fit to prescribe, and, with the
b. Establish technical subcommissions on which any contracting State may exception of assessments under Chapter XV to States consenting thereto, shall
be represented, if it so desires; apportion the expenses of the Organization among the contracting States on the
basis which it shall from time to time determine.[1]

c. Advise the Council concerning the collection and communication to the

contracting States of all information which it considers necessary and [1] Amended 1954-06-14, entered into force 1956-12-12.
useful for the advancement of air navigation.
Article 62

Suspension of voting power

Chapter XI - Personnel

The Assembly may suspend the voting power in the Assembly and in the Council of
Article 58
any contracting State that fails to discharge within a reasonable period its financial
Appointment of personnel obligations to the Organization.

Subject to any rules laid down by the Assembly and to the provisions of this Article 63

Convention, the Council shall determine the method of appointment and of Expenses of delegations and other representatives
termination of appointment, the training, and the salaries, allowances, and
conditions of service of the Secretary General and other personnel of the Each contracting State shall bear the expenses of its own delegation to the
Organization, and may employ or make use of the services of nationals of any Assembly and the remuneration, travel, and other expenses of any person whom it
contracting State.
appoints to serve on the Council, and of its nominees or representatives on any
subsidiary committees or commissions of the Organization.

Article 59

International character of personnel Chapter XIII - Other international arrangements

The President of the Council, the Secretary General, and other personnel shall not Article 64

seek or receive instructions in regard to the discharge of their responsibilities from Security arrangements
any authority external to the Organization. Each contracting State undertakes fully
The Organization may, with respect to air matters within its competence directly If the Council is of the opinion that the airports or other air navigation facilities,
affecting world security, by vote of the Assembly enter into appropriate including radio and meteorological services, of a contracting State are not
arrangements with any general organization set up by the nations of the world to reasonably adequate for the safe, regular, efficient, and economical operation of
preserve peace.
international air services, present or contemplated, the Council shall consult with
the State directly concerned, and other States affected, with a view to finding
Article 65
means by which the situation may be remedied, and may make recommendations
Arrangements with other international bodies for that purpose. No contracting State shall be guilty of an infraction of this
Convention if it fails to carry out these recommendations.

The Council, on behalf of the Organization, may enter into agreements with other
international bodies for the maintenance of common services and for common Article 70

arrangements concerning personnel and, with the approval of the Assembly, may Financing of air navigation facilities
enter into such other arrangements as may facilitate the work of the Organization.

A contracting State, in the circumstances arising under the provisions of Article 69,
Article 66
may conclude an arrangement with the Council for giving effect to such
Functions relating to other agreements recommendations. The State may elect to bear all of the costs involved in any such
arrangement. If the State does not so elect, the Council may agree, at the request
a. The Organization shall also carry out the functions placed upon it by the
International Air Services Transit Agreement and by the International Air Transport of the State, to provide for all or a portion of the costs.

Agreement drawn up at Chicago on December 7, 1944, in accordance with the

terms and conditions therein set forth. Article 71

Provision and maintenance of facilities by Council

b. Members of the Assembly and the Council who have not accepted the International
Air Services Transit Agreement of the International Air Transport Agreement drawn If a contracting State so requests, the Council may agree to provide, man, maintain,
up at Chicago on December 7, 1944 shall not have the right to vote on any and administer any or all of the airports and other air navigation facilities including
questions referred to the Assembly or Council under the provisions of the relevant radio and meteorological services, required in its territory for the safe, regular,
Agreement.
efficient and economical operation of the international air services of the other
Part III - International air transport
contracting States, and may specify just and reasonable charges for the use of the
Chapter XIV - Information and reports
facilities provided.

Article 67
Article 72

File reports with Council Acquisition or use of land

Each contracting State undertakes that its international airlines shall, in accordance Where land is needed for facilities financed in whole or in part by the Council at the
with requirements laid down by the Council, file with the Council traffic reports, cost request of a contracting State, that State shall either provide the land itself,
statistics and financial statements showing among other things all receipts and the retaining title if it wishes, or facilitate the use of the land by the Council on just and
sources thereof.
reasonable terms and in accordance with the laws of the State concerned.

Article 73

Chapter XV - Airports and other air navigation facilities

Expenditure and assessment of funds
Within the limit of the funds which may be made available to it by the Assembly
Article 68
under Chapter XII, the Council may make current expenditures for the purposes of
Designation of routes and airports this Chapter from the general funds of the organization. The Council shall assess
the capital funds required for the purposes of this Chapter in previously agreed
Each contracting State may, subject to the provisions of this Convention, designate proportions over a reasonable period of time to the contracting States consenting
the route to be followed within its territory by any international air service and the thereto whose airlines use the facilities. The Council may also assess to States that
airports which any such service may use.
consent any working funds that are required.

Article 69
Article 74

Improvement of air navigation facilities Technical assistance and utilization of revenues

When the Council, at the request of a contracting State, advances funds or
provides airports or other facilities in whole or in part, the arrangement may Article 79

provide, with the consent of that State, for technical assistance in the supervision Participation in operating organizations
and operation of the airports and other facilities, and for the payment, from the
revenues derived from the operation of the airports and other facilities, of the A State may participate in joint operating organizations or in pooling arrangements,
operating expenses of the airports and the other facilities, and of interest and either through its government or through an airline company or companies
amortization charges.
designated by its government. The companies may, at the sole discretion of the
State concerned, be state-owned or partly state-owned or privately owned.

Article 75

Taking over of facilities from Council Part IV - Final provisions

Chapter XVII - Other aeronautical agreements and arrangements

A contracting State may at any time discharge any obligation into which it has
entered under Article 70, and take over airports and other facilities which the Article 80

Council has provided in its territory pursuant to the provisions of Articles 71 and 72, Paris and Habana Conventions
by paying to the Council an amount which in the opinion of the Council is
reasonable in the circumstances. If the State considers that the amount fixed by the Each contracting State undertakes, immediately upon the coming into force of this
Council is unreasonable it may appeal to the Assembly against the decision of the Convention, to give notice of denunciation of the Convention relating to the
Council and the Assembly may confirm or amend the decision of the Council.
Regulation of Aerial Navigation signed at Paris on October 13, 1919 or the
Convention on Commercial Aviation signed at Habana on February 20, 1928, if it is
Article 76
a party to either. As between contracting States, this Convention supersedes the
Return of funds Conventions of Paris and Habana previously referred to.

Funds obtained by the Council through reimbursement under Article 75 and from Article 81

receipts of interest and amortization payments under Article 74 shall, in the case of Registration of existing agreements
advances originally financed by States under Article 73, be returned to the States
which were originally assessed in the proportion of their assessments, as All aeronautical agreements which are in existence on the coming into force of this
determined by the Council.
Convention, and which are between a contracting State and any other State or
between an airline of a contracting State and any other State or the airline of any
Chapter XVI - Joint operating organizations and pooled services
other State, shall be forthwith registered with the Council.

Article 77
Article 82

Joint operating organizations permitted Abrogation of inconsistent arrangements

Nothing in this Convention shall prevent two or more contracting States from The contracting States accept this Convention as abrogating all obligations and
constituting joint air transport operating organizations or international operating understandings between them which are inconsistent with its terms, and undertake
agencies and from pooling their air services on any routes or in any regions, but not to enter into any such obligations and understandings. A contracting State
such organizations or agencies and such pooled services shall be subject to all the which, before becoming a member of the Organization has undertaken any
provisions of this Convention, including those relating to the registration of obligations toward a non-contracting State or a national of a contracting State or of
agreements with the Council. The Council shall determine in what manner the a non-contracting State inconsistent with the terms of this Convention, shall take
provisions of this Convention relating to nationality of aircraft shall apply to aircraft immediate steps to procure its release from the obligations. If an airline of any
operated by international operating agencies.
contracting State has entered into any such inconsistent obligations, the State of
which it is a national shall use its best efforts to secure their termination forth with
Article 78
and shall in any event cause them to be terminated as soon as such action can
Function of Council lawfully be taken after the coming into force of this Convention.

The Council may suggest to contracting States concerned that they form joint Article 83

organizations to operate air services on any routes or in any regions.

Registration of new arrangements
Subject to the provisions of the preceding Article, any contracting State may make shall name a single arbitrator who shall name an umpire. If either contracting State
arrangements not inconsistent with the provisions of this Convention. Any such party to the dispute fails to name an arbitrator within a period of three months from
arrangement shall be forthwith registered with the Council, which shall make it the date of the appeal, an arbitrator shall be named on behalf of that State by the
public as soon as possible.
President of the Council from a list of qualified and available persons maintained by
the Council. If, within thirty days, the arbitrators cannot agree on an umpire, the
Article 83bis
President of the Council shall designate an umpire from the list previously referred
Transfer of certain functions and duties[1] to. The arbitrators and the umpire shall then jointly constitute an arbitral tribunal.
Any arbitral tribunal established under this or the preceding Article shall settle its
a. Notwithstanding the provisions of Articles 12, 30, 3 1 and 32 a), when an aircraft
registered in a contracting State is operated pursuant to an agreement for the own procedure and give its decisions by majority vote, provided that the Council
lease, charter or interchange of the aircraft or any similar arrangement by an may determine procedural questions in the event of any delay which in the opinion
operator who has his principal place of business or, if he has no such place of of the Council is excessive.

business, his permanent residence in another contracting State, the State of

registry may, by agreement with such other State, transfer to it all or part of its Article 86

functions and duties as State of registry in respect of that aircraft under Articles 12,
30, 31 and 32 a). The State of registry shall be relieved of responsibility in respect
of the functions and duties transferred.
b. The transfer shall not have effect in respect of other contracting States before
either the agreement between States in which it is embodied has been registered
with the Council and made public pursuant to Article 83 or the existence and scope
of the agreement have been directly communicated to the authorities of the other
contracting State or States concerned by a State party to the agreement.
Appeals
Unless the Council decides otherwise any decision by the Council on whether an
international airline is operating in conformity with the provisions of this Convention
shall remain in effect unless reversed on appeal. On any other matter, decisions of
the Council shall, if appealed from, be suspended until the appeal is decided. The
decisions of the Permanent Court of International Justice and of an arbitral tribunal
shall be final and binding.

c. The provisions of paragraphs a) and b) above shall also be applicable to cases Article 87

covered by Article 77. Penalty for non-conformity of airline

[1] Added by amendment 1980-10-06, entered into force 1997-06-20. Each contracting State undertakes not to allow the operation of an airline of a
Chapter XVIII - Disputes and default
contracting State through the airspace above its territory if the Council has decided
that the airline concerned is not conforming to a final decision rendered in
Article 84
accordance with the previous Article.

Settlement of disputes
Article 88

If any disagreement between two or more contracting States relating to the Penalty for non-conformity by State
interpretation or application of this Convention and its Annexes cannot be settled
by negotiation, it shall, on the application of any State concerned in the Tile Assembly shall suspend the voting power in the Assembly and in the Council of
disagreement, be decided by the Council. No member of the Council shall vote in any contracting State that is found in default under the provisions of this Chapter.

the consideration by the Council of any dispute to which it is a party. Any

contracting State may, subject to Article 85, appeal from the decision of the Council Chapter XIX - War

to an ad hoc arbitral tribunal agreed upon with the other parties to the dispute or to
the Permanent Court of International Justice. Any such appeal shall be notified to Article 89

the Council within sixty days of receipt of notification of the decision of the Council.
War and emergency conditions

Article 85
In case of war, the provisions of this Convention shall not affect the freedom of
Arbitration procedure action of any of the contracting States affected, whether as belligerents or as
neutrals. The same principle shall apply in the case of any contracting State which
If any contracting State party to a dispute in which the decision of the Council is declares a state of national emergency and notifies the fact to the Council.

under appeal has not accepted the Statute of the Permanent Court of International
Justice and the contracting States parties to the dispute cannot agree on the
choice of the arbitral tribunal, each of the contracting States parties to the dispute
 prescribe: provided that in each case the assent of any State invaded or attacked
Chapter XX - Annexes
during the present war by the State seeking admission shall be necessary.

Article 93bis[1]

Article 90

a. Notwithstanding the provisions of Articles 9 1,92 and 93 above:

Adoption and amendment of Annexes

a. The adoption by the Council of the Annexes described in Article 54, subparagraph (1) A State whose government the General Assembly of the United Nations
(1), shall require the vote of two-thirds of the Council at a meeting called for that has recommended be debarred from membership in international agencies
purpose and shall then be submitted by the Council to each contracting State. Any established by or brought into relationship with the United Nations shall
such Annex or any amendment of an Annex shall become effective within three automatically cease to be a member of the International Civil Aviation Organization;

months after its submission to the contracting States or at the end of such longer
period of time as the Council may prescribe, unless in the meantime a majority of
the contracting States register their disapproval with the Council.
b. The Council shall immediately notify all contracting States of the Coming into force
(2) A State which has been expelled from membership in the United Nations
shall automatically cease to be a member of the International Civil Aviation
Organization unless the General Assembly of the United Nations attaches to its act
of expulsion a recommendation to the contrary.

of any Annex or amendment thereto.

Chapter XXI - Ratifications, adherences, amendments, and denunciations

b. A State which ceases to be a member of the International Civil Aviation

Article 91
Organization as a result of the provisions of paragraph a) above may, after approval
Ratification of Convention
a. This Convention shall be subject to ratification by the signatory States. The
instruments of ratification shall be deposited in the archives of the Government of
the United States of America, which shall give notice of the date of the deposit to
each of the signatory and adhering States.
b. As soon as this Convention has been ratified or adhered to by twenty-six States it
shall come into force between them on the thirtieth day after deposit of the twenty-
sixth instrument. It shall come into force for each State ratifying thereafter on the
thirtieth day after the deposit of its instrument of ratification.
by the General Assembly of the United Nations, be readmitted to the International
Civil Aviation Organization upon application and upon approval by a majority of the
Council.
c. Members of the Organization which are suspended from the exercise of the rights
and privileges of membership in the United Nations shall, upon the request of the
latter, be suspended from the rights and privileges of membership in this
Organization.
[1] Added by amendment 1947-05-27, entered into force 1961-03-20.

c. It shall be the duty of the Government of the United States of America to notify the
government of each of the signatory and adhering States of the date on which this
Convention comes into force.

Article 92

Adherence to Convention
a. This Convention shall be open for adherence by members of the United Nations
and States associated with them, and States which remained neutral during the
present world conflict.

b. Adherence shall be effected by a notification addressed to the Government of the

United States of America and shall take effect as from the thirtieth day from the
receipt of the notification by the Government of the United States of America,
which shall notify all the contracting States.

Article 93

Admission of other States

States other than those provided for in Articles 91 and 92 (a) may, subject to
approval by any general international organization set up by the nations of the
world to preserve peace, be admitted to participation in this Convention by means
of a four-fifths vote of the Assembly and on such conditions as the Assembly may
Article 94

Amendment of Convention
a. Any proposed amendment to this Convention must be approved by a two-thirds
vote of the Assembly and shall then come into force in respect of States which
have ratified such amendment when ratified by the number of contracting States
specified by the Assembly. The number so specified shall not be less than two-
thirds of the total number of contracting States.

b. If in its opinion the amendment is of such a nature as to justify this course, the
Assembly in its resolution recommending adoption may provide that any State
which has not ratified within a specified period after the amendment has come into
force shall thereupon cease to be a member of the Organization and a party to the
Convention.

Article 95

Denunciation of Convention
a. Any contracting State may give notice of denunciation of this Convention three
years after its coming into effect by notification addressed to the Government of
the United States of America, which shall at once inform each of the contracting
States.

b. Denunciation shall take effect one year from the date of the receipt of the
notification and shall operate only as regards the State effecting the denunciation.

Chapter XXII - Definitions

Article 96

For the purpose of this Convention the expression:

a. "Air service" means any scheduled air service performed by aircraft for the public
transport of passengers, mail or cargo.

b. "International air service" means an air service which passes through the air space
over the territory of more than one State.

c. "Airline" means any air transport enterprise offering or operating an international air
service.

d. "Stop for non-traffic purposes" means a landing for any purpose other than taking
on or discharging passengers, cargo or mail.

In witness whereof, the undersigned plenipotentiaries, having been duly authorized,

sign this Convention on behalf of their respective governments on the dates
appearing opposite their signatures.