LAW ON PUBLIC CORPORATIONS Bagabuyo vs. COMELEC 573 S 290
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Syllabus:
1. Public Corporations
a. Distinguished from GOCCs
b. Classification: Quasi-Corps & Municipal Corps.
2. Municipal Corporations
a. Elements
b. Nature and Functions
c. Requisites for creation, conversion, division, merger or dissolution
Section 14. Beginning of Corporate Existence. - When a new local government unit is
created, its corporate existence shall commence upon the election and qualification of its
chief executive and a majority of the members of its sanggunian, unless some other time is
fixed therefor by the law or ordinance creating it.
Creation of Municipal Corporation:
Section 6. Authority to Create Local Government Units. - A local government unit may be
created, divided, merged, abolished, or its boundaries substantially altered either by law
enacted by Congress in the case of a province, city, municipality, or any other political
subdivision, or by ordinance passed by the sangguniang panlalawigan or sangguniang
panlungsod concerned in the case of a barangay located within its territorial jurisdiction,
subject to such limitations and requirements prescribed in this Code.
1987 Consti. Art. X. Section 10. No province, city, municipality, or barangay may be
created, divided, merged, abolished, or its boundary substantially altered, except in
accordance with the criteria established in the local government code and subject to
approval by a majority of the votes cast in a plebiscite in the political units directly affected.
Limitations for creation:
Section 7. Creation and Conversion. - As a general rule, the creation of a local
government unit or its conversion from one level to another level shall be based on verifiable
indicators of viability and projected capacity to provide services, to wit:
(a) Income. - It must be sufficient, based on acceptable standards, to provide for all essential
government facilities and services and special functions commensurate with the size of its
population, as expected of the local government unit concerned;
(b) Population. - It shall be determined as the total number of inhabitants within the territorial
jurisdiction of the local government unit concerned; and
(c) Land Area. - It must be contiguous, unless it comprises two or more islands or is
separated by a local government unit independent of the others; properly identified by metes
and bounds with technical descriptions; and sufficient to provide for such basic services and
facilities to meet the requirements of its populace.
Compliance with the foregoing indicators shall be attested to by the Department of Finance
(DOF), the National Statistics Office (NSO), and the Lands Management Bureau (LMB) of
the Department of Environment and Natural Resources (DENR).
Cases:
Kapalong vs. Moya 166 S 71
Patricio Tan vs. COMELEC 142 S 727
Navarro vs. Ermita 612 S 161
Sema vs. COMELEC 7/16/08
Section 62. Notice of hearing.
Atitiw vs. Zamora 471 S 330
Saranggani vs. COMELEC 06/26/00
League of Cities vs. COMELEC 2/15/11
Alvarez vs. Guingona 1/31/96
Mariano vs. COMELEC 03/07/95
Settlement of Boundary Dispute:
Section 118. Jurisdictional Responsibility for Settlement of Boundary Dispute. -
Boundary disputes between and among local government units shall, as much as possible,
be settled amicably. To this end:
(a) Boundary disputes involving two (2) or more barangays in the same city or municipality
shall be referred for settlement to the sangguniang panlungsod or sangguniang bayan
concerned.
(b) Boundary disputes involving two (2) or more municipalities within the same province shall
be referred for settlement to the sangguniang panlalawigan concerned.
(c) Boundary disputes involving municipalities or component cities of different provinces shall
be jointly referred for settlement to the sanggunians of the province concerned.
(d) Boundary disputes involving a component city or municipality on the one hand and a
highly urbanized city on the other, or two (2) or more highly urbanized cities, shall be jointly
referred for settlement to the respective sanggunians of the parties.
(e) In the event the sanggunian fails to effect an amicable settlement within sixty (60) days
from the date the dispute was referred thereto, it shall issue a certification to that effect.
Thereafter, the dispute shall be formally tried by the sanggunian concerned which shall
decide the issue within sixty (60) days from the date of the certification referred to above.
Section 119. Appeal. - Within the time and manner prescribed by the Rules of Court, any
party may elevate the decision of the sanggunian concerned to the proper Regional Trial
Court having jurisdiction over the area in dispute. The Regional Trial Court shall decide the
appeal within one (1) year from the filing thereof. Pending final resolution of the disputed
area prior to the dispute shall be maintained and continued for all legal purposes.
De Facto Municipal Corporation:
Requisites:
Municipality of San Narciso, Quezon vs. Mendez 239 S 12
Municipality of Jimenez, Misamis Occ. vs. Baz 265 S 183
Legislative Control over Municipal Corporations:
Relation of the President to LGUs:
1987 Consti. Article X. Section 4. The President of the Philippines shall exercise general
supervision over local governments. Provinces with respect to component cities and
municipalities, and cities and municipalities with respect to component barangays, shall
ensure that the acts of their component units are within the scope of their prescribed powers
and functions.
1987 Consti. Article X. Section 16. The President shall exercise general supervision over
autonomous regions to ensure that laws are faithfully executed.
(a) Within seven (7) days after the administrative complaint is filed, the Office of the
President or the sanggunian concerned, as the case may be, shall require the respondent to
submit his verified answer within fifteen (15) days from receipt thereof, and commence the
investigation of the case within ten (10) days after receipt of such answer of the respondent.
(b) When the respondent is an elective official of a province or highly urbanized city, such
hearing and investigation shall be conducted in the place where he renders or holds office.
For all other local elective officials, the venue shall be the place where the sanggunian
concerned is located.
(c) However, no investigation shall be held within ninety (90) days immediately prior to any
local election, and no preventive suspension shall be imposed within the said period. If
preventive suspension has been imposed prior to the 90-day period immediately preceding
local election, it shall be deemed automatically lifted upon the start of aforesaid period.
Section 63. Preventive Suspension. -
(a) Preventive suspension may be imposed:
(1) By the President, if the respondent is an elective official of a province, a highly urbanized
or an independent component city;
(2) By the governor, if the respondent is an elective official of a component city or
municipality; or
(3) By the mayor, if the respondent is an elective official of the barangay.
(b) Preventive suspension may be imposed at any time after the issues are joined, when the
evidence of guilt is strong, and given the gravity of the offense, there is great probability that
the continuance in office of the respondent could influence the witnesses or pose a threat to
the safety and integrity of the records and other evidence: Provided, That, any single
preventive suspension of local elective officials shall not extend beyond sixty (60) days:
Provided, further, That in the event that several administrative cases are filed against an
elective official, he cannot be preventively suspended for more than ninety (90) days within a
single year on the same ground or grounds existing and known at the time of the first
suspension.
(c) Upon expiration of the preventive suspension, the suspended elective official shall be
deemed reinstated in office without prejudice to the continuation of the proceedings against
him, which shall be terminated within one hundred twenty (120) days from the time he was
formally notified of the case against him. However, if the delay in the proceedings of the case
is due to his fault, neglect, or request, other than the appeal duly filed, the duration of such
delay shall not be counted in computing the time of termination of the case.
(d) Any abuse of the exercise of the power of preventive suspension shall be penalized as
abuse of authority.
Grounds for Disciplinary Action:
Section 60. Grounds for Disciplinary Actions. - An elective local official may be
disciplined, suspended, or removed from office on any of the following grounds:
(a) Disloyalty to the Republic of the Philippines;
(b) Culpable violation of the Constitution;
(c) Dishonesty, oppression, misconduct in office, gross negligence, or dereliction of duty;
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(d) Commission of any offense involving moral turpitude or an offense punishable by at least
prision mayor;
(e) Abuse of authority;
(f) Unauthorized absence for fifteen (15) consecutive working days, except in the case of
members of the sangguniang panlalawigan, sangguniang panlungsod, sangguniang bayan,
and sangguniang barangay;
(g) Application for, or acquisition of, foreign citizenship or residence or the status of an
immigrant of another country; and
(h) Such other grounds as may be provided in this Code and other laws.
An elective local official may be removed from office on the grounds enumerated above by
order of the proper court.
Section 64. Salary of Respondent Pending Suspension. - The respondent official
preventively suspended from office shall receive no salary or compensation during such
suspension; but upon subsequent exoneration and reinstatement, he shall be paid full salary
or compensation including such emoluments accruing during such suspension.
Section 65. Rights of Respondent. - The respondent shall be accorded full opportunity to
appear and defend himself in person or by counsel, to confront and cross-examine the
witnesses against him, and to require the attendance of witnesses and the production of
documentary process of subpoena or subpoena duces tecum.
Section 66. Form and Notice of Decision. -
(a) The investigation of the case shall be terminated within ninety (90) days from the start
thereof. Within thirty (30) days after the end of the investigation, the Office of the President
or the sanggunian concerned shall render a decision in writing stating clearly and distinctly
the facts and the reasons for such decision. Copies of said decision shall immediately be
furnished the respondent and all interested parties.
(b) The penalty of suspension shall not exceed the unexpired term of the respondent or a
period of six (6) months for every administrative offense, nor shall said penalty be a bar to
the candidacy of the respondent so suspended as long as he meets the qualifications
required for the office.
(c) The penalty of removal from office as a result of an administrative investigation shall be
considered a bar to the candidacy of the respondent for any elective position.
Section 67. Administrative Appeals. - Decisions in administrative cases may, within thirty
(30) days from receipt thereof, be appealed to the following:
(a) The sangguniang panlalawigan, in the case of decisions of the sangguniang panlungsod
of component cities and the sangguniang bayan; and
(b) The Office of the President, in the case of decisions of the sangguniang panlalawigan
and the sangguniang panlungsod of highly urbanized cities and independent component
cities.
Decisions of the Office of the President shall be final and executory.
Section 68. Execution Pending Appeal. - An appeal shall not prevent a decision from
becoming final or executory. The respondent shall be considered as having been placed
under preventive suspension during the pendency of an appeal in the event he wins such White Light Corp. vs. Manila City 1/20/09
appeal. In the event the appeal results in an exoneration, he shall be paid his salary and City of Manila vs. Laguio, Jr. 455 S 308
such other emoluments during the pendency of the appeal. Velasco vs. Villegas 120 S 568
LLDA vs. CA 251 S 42
Joson vs. Torres 290 S 279 Balacuit vs. CFI 163 S 182
Regidor vs. Chiongbian 173 S 507 Tan vs. Perena 452 S 53
Malinao vs. Reyes 255 S 616 Dr. Velasco vs. Blas 115 S 540
Berces vs. Guingona & Mayor Corral 241 S 439
Sangguniang Barangay of Don Mariano Marcos, Bayombong, Nueva Viscaya vs. Martinez Section 398. Powers of the Barangay Assembly. - The barangay assembly shall:
3/3/08
Berces vs. Guingona & Mayor Corral 241 S 539 (a) Initiate legislative processes by recommending to the sangguniang barangay the
adoption of measures for the welfare of the barangay and the city or municipality concerned;
3. Principles of Local Autonomy
(b) Decide on the adoption of initiative as a legal process whereby the registered voters of
1987 Consti. Art. X. Section 2. The territorial and political subdivisions shall enjoy local the barangay may directly propose, enact, or amend any ordinance; and
autonomy. (Administrative Autonomy)
(c) Hear and pass upon the semestral report of the sangguniang barangay concerning its
1987 Consti. Art. X. Section 18. The Congress shall enact an organic act for each activities and finances.
autonomous region with the assistance and participation of the regional consultative
commission composed of representatives appointed by the President from a list of nominees Section 491. Purpose of Organization. - There shall be an organization of all barangays to
be known as the liga ng mga barangay for the primary purpose of determining the
from multi-sectoral bodies. The organic act shall define the basic structure of government for
the region consisting of the executive department and legislative assembly, both of which representation of the Liga in the sanggunians, and for ventilating, articulating and
shall be elective and representative of the constituent political units. The organic acts shall crystallizing issues affecting barangay government administration and securing, through
likewise provide for special courts with personal, family, and property law jurisdiction proper and legal means, solutions thereto.
consistent with the provisions of this Constitution and national laws.
Dela Cruz vs. Paras 123 S 569
The creation of the autonomous region shall be effective when approved by majority of the Tatel vs. Mun. of Vigan 207 S 157
votes cast by the constituent units in a plebiscite called for the purpose, provided that only RB of Makati vs. Mun. of Makati 433 S 362
provinces, cities, and geographic areas voting favorably in such plebiscite shall be included Tano vs. Socrates 278 S 144
in the autonomous region. (Political Autonomy) Villegas vs. Hiu Pao Ho 86 S 270
Lina vs. Pano 364 S 76
4. Powers of LGU Province of North Cotabato vs. GRP Peace Panel on AD 10/14/08
a. Police Power Javellana vs. Kintanar 119 S 627
Lucena Grand Central Terminal Inc. vs. JAC Liner Inc. 452 S 174
Section 16. General Welfare. - Every local government unit shall exercise the powers Batangas CATV vs. SP of Batangas 439 S 327
expressly granted, those necessarily implied therefrom, as well as powers necessary, Monteverde vs. Generoso
appropriate, or incidental for its efficient and effective governance, and those which are Bayan vs. Ermita 4/25/06
essential to the promotion of the general welfare. Within their respective territorial
jurisdictions, local government units shall ensure and support, among other things, the b. Eminent Domain
preservation and enrichment of culture, promote health and safety, enhance the right of the
people to a balanced ecology, encourage and support the development of appropriate and 1987 Consti. Art. III. Section 9. Private property shall not be taken for public use without
self-reliant scientific and technological capabilities, improve public morals, enhance just compensation.
economic prosperity and social justice, promote full employment among their residents,
maintain peace and order, and preserve the comfort and convenience of their inhabitants.
Beluso vs. Mun. of Panay 498 S 113
Sangalang vs. IAC 176 S 720 Requisites:
Baguio Citizens Action vs. City Council
Quezon City vs. Ericta
Section 19. Eminent Domain. - A local government unit may, through its chief executive
Lim vs. CA 387 S 149 and acting pursuant to an ordinance, exercise the power of eminent domain for public use, or
Parayno vs. Jovellanos 495 S 85
purpose or welfare for the benefit of the poor and the landless, upon payment of just
Albon vs. Fernando 494 S 143 compensation, pursuant to the provisions of the Constitution and pertinent laws: Provided,
however, That the power of eminent domain may not be exercised unless a valid and definite
Section 335. Prohibitions Against Expenditures for Religious or Private Purposes. - No offer has been previously made to the owner, and such offer was not accepted: Provided,
public money or property shall be appropriated or applied for religious or private purposes. further, That the local government unit may immediately take possession of the property
upon the filing of the expropriation proceedings and upon making a deposit with the proper
Ermita Malate Hotel Operators vs. Mayor of Manila 7/31/67 court of at least fifteen percent (15%) of the fair market value of the property based on the
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current tax declaration of the property to be expropriated: Provided, finally, That, the amount
to be paid for the expropriated property shall be determined by the proper court, based on
the fair market value at the time of the taking of the property.
Beluso vs. Mun. of Panay 498 S 113
Limitations:
1987 Consti. Art. III. Section 1. No person shall be deprived of life, liberty, or property
without due process of law, nor shall any person be denied the equal protection of the laws.
1987 Consti. Art. III. Section 9. Private property shall not be taken for public use without
just compensation.
Moday vs. CA 268 S 587
Guido vs. Rural Administration
Lagcao vs. Labra 440 S 279
Mun. of Paranaque vs. VM Realty 292 S 677
Distinction between Ordinance and Resolution
Section 20. Reclassification of Lands. -
(a) A city or municipality may, through an ordinance passed by the sanggunian after
conducting public hearings for the purpose, authorize the reclassification of agricultural lands
and provide for the manner of their utilization or disposition in the following cases: (1) when
the land ceases to be economically feasible and sound for agricultural purposes as
determined by the Department of Agriculture or (2) where the land shall have substantially
greater economic value for residential, commercial, or industrial purposes, as determined by
the sanggunian concerned: Provided, That such reclassification shall be limited to the
following percentage of the total agricultural land area at the time of the passage of the
ordinance:
(1) For highly urbanized and independent component cities, fifteen percent (15%);
(2) For component cities and first to the third class municipalities, ten percent (10%); and
(3) For fourth to sixth class municipalities, five percent (5%): Provided, further, That
agricultural lands distributed to agrarian reform beneficiaries pursuant to Republic Act
Numbered Sixty-six hundred fifty-seven (R.A. No. 6657). otherwise known as "The
Comprehensive Agrarian Reform Law", shall not be affected by the said reclassification and
the conversion of such lands into other purposes shall be governed by Section 65 of said
Act.
(b) The President may, when public interest so requires and upon recommendation of the
National Economic and Development Authority, authorize a city or municipality to reclassify
lands in excess of the limits set in the next preceding paragraph.
(c) The local government units shall, in conformity with existing laws, continue to prepare
their respective comprehensive land use plans enacted through zoning ordinances which
shall be the primary and dominant bases for the future use of land resources: Provided. That
the requirements for food production, human settlements, and industrial expansion shall be
taken into consideration in the preparation of such plans.
(d) Where approval by a national agency is required for reclassification, such approval shall
not be unreasonably withheld. Failure to act on a proper and complete application for
reclassification within three (3) months from receipt of the same shall be deemed as
approval thereof.
(e) Nothing in this Section shall be construed as repealing, amending, or modifying in any
manner the provisions of R.A. No. 6657.
DAR vs. PCPI 564 S 81
City of Manila vs. Arellano Colleges
Yujuico vs. Atienza 472 S 466
c. Taxing Power
1987 Consti. Art. X Section 5. Each local government unit shall have the power to create its
own sources of revenues and to levy taxes, fees and charges subject to such guidelines and
limitations as the Congress may provide, consistent with the basic policy of local autonomy.
Such taxes, fees, and charges shall accrue exclusively to the local governments.
Section 130. Fundamental Principles. - The following fundamental principles shall govern
the exercise of the taxing and other revenue-raising powers of local government units:
(a) Taxation shall be uniform in each local government unit;
(b) Taxes, fees, charges and other impositions shall:
(1) be equitable and based as far as practicable on the taxpayer's ability to pay;
(2) be levied and collected only for public purposes;
(3) not be unjust, excessive, oppressive, or confiscatory;
(4) not be contrary to law, public policy, national economic policy, or in the restraint of trade;
(c) The collection of local taxes, fees, charges and other impositions shall in no case be let to
any private person;
(d) The revenue collected pursuant to the provisions of this Code shall inure solely to the
benefit of, and be subject to the disposition by, the local government unit levying the tax, fee,
charge or other imposition unless otherwise specifically provided herein; and,
(e) Each local government unit shall, as far as practicable, evolve a progressive system of
taxation.
Section 186. Power To Levy Other Taxes, Fees or Charges. - Local government units
may exercise the power to levy taxes, fees or charges on any base or subject not otherwise
specifically enumerated herein or taxed under the provisions of the National Internal
Revenue Code, as amended, or other applicable laws: Provided, That the taxes, fees, or
charges shall not be unjust, excessive, oppressive, confiscatory or contrary to declared
national policy: Provided, further, That the ordinance levying such taxes, fees or charges
shall not be enacted without any prior public hearing conducted for the purpose.
Section 187. Procedure for Approval and Effectivity of Tax, Ordinances and Revenue
Measures; Mandatory Public Hearings. - The procedure for approval of local tax
ordinances and revenue measures shall be in accordance with the provisions of this Code:
Provided, That public hearings shall be conducted for the purpose prior to the enactment
thereof: Provided, further, That any question on the constitutionality or legality of tax
ordinances or revenue measures may be raised on appeal within thirty (30) days from the
effectivity thereof to the Secretary of Justice who shall render a decision within sixty (60)
days from the date of receipt of the appeal: Provided, however, That such appeal shall not
have the effect of suspending the effectivity of the ordinance and the accrual and payment of
the tax, fee, or charge levied therein: Provided, finally, That within thirty (30) days after
receipt of the decision or the lapse of the sixty-day period without the Secretary of Justice
acting upon the appeal, the aggrieved party may file appropriate proceedings with a court of
competent jurisdiction.
Drilon vs. Lim 235 S 135
Fundamental Principles governing LGUs’ Financial Affairs/Op’ns:
Section 305. Fundamental Principles. - The financial affairs, transactions, and operations
of local government units shall be governed by the following fundamental principles:
(a) No money shall be paid out of the local treasury except in pursuance of an appropriations
ordinance or law;
(b) Local government funds and monies shall be spent solely for public purposes;
(c) Local revenue is generated only from sources expressly authorized by law or ordinance,
and collection thereof shall at all times be acknowledged properly;
(d) All monies officially received by a local government officer in any capacity or on any
occasion shall be accounted for as local funds, unless otherwise provided by law;
(e) Trust funds in the local treasury shall not be paid out except in fulfillment of the purpose
for which the trust was created or the funds received;
(f) Every officer of the local government unit whose duties permit or require the possession
or custody of local funds shall be properly bonded, and such officer shall be accountable and
responsible for said funds and for the safekeeping thereof in conformity with the provisions of
law;
(g) Local governments shall formulate sound financial plans, and local budgets shall be
based on functions, activities, and projects, in terms of expected results;
(h) Local budget plans and goals shall, as far as practicable, be harmonized with national
development plans, goals, and strategies in order to optimize the utilization of resources and
to avoid duplication in the use of fiscal and physical resources;
(i) Local budgets shall operationalize approved local development plans;
(j) Local government units shall ensure that their respective budgets incorporate the
requirements of their component units and provide for equitable allocation of resources
among these component units;
(k) National planning shall be based on local planning to ensure that the needs and
aspirations of the people as articulated by the local government units in their respective local
development plans are considered in the formulation of budgets of national line agencies or
offices;
(l) Fiscal responsibility shall be shared by all those exercising authority over the financial
affairs, transactions, and operations of the local government units; and
(m) The local government unit shall endeavor to have a balanced budget in each fiscal year
of operation.
MIAA vs. CA 495 S 591
General Rule:
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Section 234. Exemptions from Real Property Tax. - The following are exempted from
payment of the real property tax:
(a) Real property owned by the Republic of the Philippines or any of its political subdivisions
except when the beneficial use thereof has been granted, for consideration or otherwise, to a
taxable person;
(b) Charitable institutions, churches, parsonages or convents appurtenant thereto, mosques,
non-profit or religious cemeteries and all lands, buildings, and improvements actually,
directly, and exclusively used for religious, charitable or educational purposes;
(c) All machineries and equipment that are actually, directly and exclusively used by local
water districts and government owned or controlled corporations engaged in the supply and
distribution of water and/or generation and transmission of electric power;
(d) All real property owned by duly registered cooperatives as provided for under R.A. No.
6938; and
(e) Machinery and equipment used for pollution control and environmental protection.
Except as provided herein, any exemption from payment of real property tax previously
granted to, or presently enjoyed by, all persons, whether natural or juridical, including all
government-owned or controlled corporations are hereby withdrawn upon the effectivity of
this Code.
Exception:
Section 133. Common Limitations on the Taxing Powers of Local Government Units. -
Unless otherwise provided herein, the exercise of the taxing powers of provinces, cities,
municipalities, and barangays shall not extend to the levy of the following:
(a) Income tax, except when levied on banks and other financial institutions;
(b) Documentary stamp tax;
(c) Taxes on estates, inheritance, gifts, legacies and other acquisitions mortis causa, except
as otherwise provided herein;
(d) Customs duties, registration fees of vessel and wharfage on wharves, tonnage dues, and
all other kinds of customs fees, charges and dues except wharfage on wharves constructed
and maintained by the local government unit concerned;
(e) Taxes, fees, and charges and other impositions upon goods carried into or out of, or
passing through, the territorial jurisdictions of local government units in the guise of charges
for wharfage, tolls for bridges or otherwise, or other taxes, fees, or charges in any form
whatsoever upon such goods or merchandise;
(f) Taxes, fees or charges on agricultural and aquatic products when sold by marginal
farmers or fishermen;
(g) Taxes on business enterprises certified to by the Board of Investments as pioneer or non-
pioneer for a period of six (6) and four (4) years, respectively from the date of registration;
(h) Excise taxes on articles enumerated under the national Internal Revenue Code, as
amended, and taxes, fees or charges on petroleum products;
(i) Percentage or value-added tax (VAT) on sales, barters or exchanges or similar
transactions on goods or services except as otherwise provided herein;
(j) Taxes on the gross receipts of transportation contractors and persons engaged in the
transportation of passengers or freight by hire and common carriers by air, land or water,
except as provided in this Code;
(k) Taxes on premiums paid by way or reinsurance or retrocession;
(l) Taxes, fees or charges for the registration of motor vehicles and for the issuance of all
kinds of licenses or permits for the driving thereof, except tricycles;
(m) Taxes, fees, or other charges on Philippine products actually exported, except as
otherwise provided herein;
(n) Taxes, fees, or charges, on Countryside and Barangay Business Enterprises and
cooperatives duly registered under R.A. No. 6810 and Republic Act Numbered Sixty-nine
hundred thirty-eight (R.A. No. 6938) otherwise known as the "Cooperative Code of the
Philippines" respectively; and
(o) Taxes, fees or charges of any kind on the National Government, its agencies and
instrumentalities, and local government units.
Coca Cola vs. Manila City 493 S 279
Villanueva vs. Mayor Ople of Hagonoy, Bulacan 475 S 540
Requisites for validity of municipal contracts:
Section 23. Authority to Negotiate and Secure Grants. - Local chief executives may,
upon authority of the sanggunian, negotiate and secure financial grants or donations in kind,
in support of the basic services or facilities enumerated under Section 17 hereof, from local
and foreign assistance agencies without necessity of securing clearance or approval therefor
from any department, agency, or office of the national government of from any higher local
government unit: Provided, That projects financed by such grants or assistance with national
security implications shall be approved by the national agency concerned: Provided, further,
That when such national agency fails to act on the request for approval within thirty (30) days
from receipt thereof, the same shall be deemed approved.
The local chief executive shall, within thirty (30) days upon signing of such grant agreement
or deed of donation, report the nature, amount, and terms of such assistance to both Houses
of Congress and the President.
d. Closure and Opening of Roads
Section 21. Closure and Opening of Roads. -
(a) A local government unit may, pursuant to an ordinance, permanently or temporarily close
or open any local road, alley, park, or square falling within its jurisdiction: Provided, however,
That in case of permanent closure, such ordinance must be approved by at least two-thirds
(2/3) of all the members of the sanggunian, and when necessary, an adequate substitute for
the public facility that is subject to closure is provided.
(b) No such way or place or any part thereof shall be permanently closed without making
provisions for the maintenance of public safety therein. A property thus permanently
withdrawn from public use may be used or conveyed for any purpose for which other real
property belonging to the local government unit concerned may be lawfully used or
conveyed: Provided, however, That no freedom park shall be closed permanently without
provision for its transfer or relocation to a new site.
(c) Any national or local road, alley, park, or square may be temporarily closed during an
actual emergency, or fiesta celebrations, public rallies, agricultural or industrial fairs, or an
undertaking of public works and highways, telecommunications, and waterworks projects,
the duration of which shall be specified by the local chief executive concerned in a written
order: Provided, however, That no national or local road, alley, park, or square shall be
temporarily closed for athletic, cultural, or civic activities not officially sponsored, recognized,
or approved by the local government unit concerned.
(d) Any city, municipality, or barangay may, by a duly enacted ordinance, temporarily close
and regulate the use of any local street, road, thoroughfare, or any other public place where
shopping malls, Sunday, flea or night markets, or shopping areas may be established and
where goods, merchandise, foodstuffs, commodities, or articles of commerce may be sold
and dispensed to the general public.
Mun. of Cavite vs. Rojas
Cebu Oxygen & Acetylene vs. Bercilles
Legal Counsel of LGUs:
Section 481. Qualifications, Terms, Powers and Duties.
(a) No person shall be appointed legal officer unless he is a citizen of the Philippines, a
resident of the local government concerned, of good moral character, and a member of the
Philippine Bar. He must have practiced his profession for at least five (5) years in the case of
the provincial and city legal officer, and three (3) years in the case of the municipal legal
officer.
The term of the legal officer shall be coterminous with that of his appointing authority.
The appointment of legal officer shall be mandatory for the provincial and city governments
and optional for the municipal government.
(b) The legal officer, the chief legal counsel of the local government unit, shall take charge of
the office of legal services and shall:
(1) Formulate measures for the consideration of the sanggunian and provide legal
assistance and support to the governor or mayor, as the case may be, in carrying out the
delivery of basic services and provisions of adequate facilities as provided for under Section
17 of this Code;
(2) Develop plans and strategies and upon approval thereof by the governor or mayor, as the
case may be, implement the same, particularly those which have to do with programs and
projects related to legal services which the governor or mayor is empowered to implement
and which the sanggunian is empowered to provide for under this Code;
(3) In addition to the foregoing duties and functions, the legal officer shall:
(i) Represent the local government unit in all civil actions and special proceedings wherein
the local government unit or any official thereof, in his official capacity, is a party: Provided,
That, in actions or proceedings where a component city or municipality is a party adverse to
the provincial government or to another component city or municipality, a special legal officer
may be employed to represent the adverse party;
(ii) When required by the governor, mayor or sanggunian, draft ordinances, contracts, bonds,
leases and other instruments, involving any interest of the local government unit and provide
comments and recommendations on any instrument already drawn;
(iii) Render his opinion in writing on any question of law when requested to do so by the
governor, mayor or sanggunian;
Law on Public Corporations and Officers | 4
(iv) Investigate or cause to be investigated any local official or employee for administrative
neglect or misconduct in office, and recommend appropriate action to the governor, mayor or
sanggunian, as the case may be;
(v) Investigate or cause to be investigated any person, firm or corporation holding any
franchise or exercising any public privilege for failure to comply with any term or condition in
the grant of such franchise or privilege, and recommending appropriate action to the
governor, mayor or sanggunian, as the case may be;
(vi) When directed by the governor, mayor, or sanggunian, initiate and prosecute in the
interest of the local government unit concerned any civil action on any bond, lease or other
contract upon any breach or violation thereof; and
(vii) Review and submit recommendations on ordinances approved and execute orders
issued by component units;
(3) Recommend measures to the sanggunian and advise the governor or mayor as the case
may be on all other matters related to upholding the rule of law;
(4) Be in the frontline of protecting human rights and prosecuting any violations thereof,
particularly those which occur during and in the aftermath of man-made or natural disasters
or calamities; and
(5) Exercise such other powers and perform such other duties and functions as may be
prescribed by law or ordinance.
Asean Pacific vs. Urdaneta City 566 S 221
Mun. of Pililla, Rizal vs. CA 233 S 484
e. Legislative Power
i. Requisites for valid ordinance
Section 48. Local Legislative Power. - Local legislative power shall be exercised by the
sangguniang panlalawigan for the province; the sangguniang panlungsod for the city; the
sangguniang bayan for the municipality; and the sangguniang barangay for the barangay.
Section 49. Presiding Officer. -
(a) The vice-governor shall be the presiding officer of the sangguniang panlalawigan; the city
vice-mayor, of the sangguniang panlungsod; the municipal vice-mayor, of the sangguniang
bayan; and the punong barangay, of the sangguniang barangay. The presiding officer shall
vote only to break a tie.
(b) In the event of the inability of the regular presiding officer to preside at a sanggunian
session, the members present and constituting a quorum shall elect from among themselves
a temporary presiding officer. He shall certify within ten (10) days from the passage of
ordinances enacted and resolutions adopted by the sanggunian in the session over which he
temporarily presided.
Section 50. Internal Rules of Procedure. -
(a) On the first regular session following the election of its members and within ninety (90)
days thereafter, the sanggunian concerned shall adopt or update its existing rules of
procedure.
(b) The rules of procedure shall provided for the following:
(1) The organization of the sanggunian and the election of its officers as well as the creation
of standing committees which shall include, but shall not be limited to, the committees on
appropriations, women and family, human rights, youth and sports development,
environmental protection, and cooperatives; the general jurisdiction of each committee; and
the election of the chairman and members of each committee;
(2) The order and calendar of business for each session;
(3) The legislative process;
(4) The parliamentary procedures which include the conduct of members during sessions;
(5) The discipline of members for disorderly behavior and absences without justifiable cause
for four (4) consecutive sessions, for which they may be censured, reprimanded, or excluded
from the session, suspended for not more than sixty (60) days, or expelled: Provided, That
the penalty of suspension or expulsion shall require the concurrence of at least two-thirds
(2/3) vote of all the sanggunian members: Provided, further, That a member convicted by
final judgment to imprisonment of at least one (1) year for any crime involving moral turpitude
shall be automatically expelled from the sanggunian; and
(6) Such other rules as the sanggunian may adopt.lawphil™
Section 51. Full Disclosure of Financial and Business Interests of Sanggunian
Members. -
(a) Every sanggunian member shall, upon assumption to office, make a full disclosure of his
business and financial interests, or professional relationship or any relation by affinity or
consanguinity within the fourth civil degree, which he may have with any person, firm, or
entity affected by any ordinance or resolution under consideration by the sanggunian of
which he is a member, which relationship may result in conflict of interest. Such relationship
shall include:
(1) Ownership of stock or capital, or investment, in the entity or firm to which the ordinance
or resolution may apply; and
(2) Contracts or agreements with any person or entity which the ordinance or resolution
under consideration may affect.
In the absence of a specific constitutional or statutory provision applicable to this situation,
"conflict of interest" refers in general to one where it may be reasonably deduced that a
member of a sanggunian may not act in the public interest due to some private, pecuniary, or
other personal considerations that may tend to affect his judgment to the prejudice of the
service or the public.
(b) The disclosure required under this Act shall be made in writing and submitted to the
secretary of the sanggunian or the secretary of the committee of which he is a member. The
disclosure shall, in all cases, form part of the record of the proceedings and shall be made in
the following manner:
(1) Disclosure shall be made before the member participates in the deliberations on the
ordinance or resolution under consideration: Provided, That, if the member did not
participate during the deliberations, the disclosure shall be made before voting on the
ordinance or resolution on second and third readings; and
(2) Disclosure shall be made when a member takes a position or makes a privilege speech
on a matter that may affect the business interest, financial connection, or professional
relationship described herein.
Section 52. Sessions. -
(a) On the first day of the session immediately following the election of its members, the
sanggunian shall, by resolution, fix the day, time, and place of its regular sessions. The
minimum numbers of regular sessions shall be once a week for the sangguniang
panlalawigan, sangguniang panlungsod, and sangguniang bayan, and twice a month for the
sangguniang barangay.
(b) When public interest so demands, special sessions may be called by the local chief
executive or by a majority of the members of the sanggunian.
(c) All sanggunian sessions shall be open to the public unless a closed-door session is
ordered by an affirmative vote of a majority of the members present, there being a quorum,
in the public interest or for reasons of security, decency, or morality. No two (2) sessions,
regular or special, may be held in a single day.
(d) In the case of special sessions of the sanggunian, a written notice to the members shall
be served personally at the member's usual place of residence at least twenty-four (24)
hours before the special session is held.
Unless otherwise concurred in by two-thirds (2/3) vote of the sanggunian members present,
there being a quorum, no other matters may be considered at a special session except those
stated in the notice.
(e) Each sanggunian shall keep a journal and record of its proceedings which may be
published upon resolution of the sanggunian concerned.
Section 53. Quorum. -
(a) A majority of all the members of the sanggunian who have been elected and qualified
shall constitute a quorum to transact official business. Should a question of quorum be
raised during a session, the presiding officer shall immediately proceed to call the roll of the
members and thereafter announce the results.
(b) Where there is no quorum, the presiding officer may declare a recess until such time as a
quorum is constituted, or a majority of the members present may adjourn from day to day
and may compel the immediate attendance of any member absent without justifiable cause
by designating a member of the sanggunian to be assisted by a member or members of the
police force assigned in the territorial jurisdiction of the local government unit concerned, to
arrest the absent member and present him at the session.
(c) If there is still no quorum despite the enforcement of the immediately preceding
subsection, no business shall be transacted. The presiding officer, upon proper motion duly
approved by the members present, shall then declare the session adjourned for lack of
quorum.
Section 54. Approval of Ordinances. -
(a) Every ordinance enacted by the sangguniang panlalawigan, sangguniang panlungsod, or
sangguniang bayan shall be presented to the provincial governor or city or municipal mayor,
as the case may be. If the local chief executive concerned approves the same, he shall affix
his signature on each and every page thereof; otherwise, he shall veto it and return the same
with his objections to the sanggunian, which may proceed to reconsider the same. The
sanggunian concerned may override the veto of the local chief executive by two-thirds (2/3)
vote of all its members, thereby making the ordinance or resolution effective for all legal
intents and purposes.
Law on Public Corporations and Officers | 5
(b) The veto shall be communicated by the local chief executive concerned to the
sanggunian within fifteen (15) days in the case of a province, and ten (10) days in the case
of a city or a municipality; otherwise, the ordinance shall be deemed approved as if he had
signed it.
(c) Ordinances enacted by the sangguniang barangay shall, upon approval by the majority of
all its members, be signed by the punong barangay.
Section 55. Veto Power of the Local Chief Executive. -
(a) The local chief executive may veto any ordinance of the sanggunian panlalawigan,
sangguniang panlungsod, or sanggunian bayan on the ground that it is ultra vires or
prejudicial to the public welfare, stating his reasons therefor in writing.
(b) The local chief executive, except the punong barangay, shall have the power to veto any
particular item or items of an appropriations ordinance, an ordinance or resolution adopting a
local development plan and public investment program, or an ordinance directing the
payment of money or creating liability. In such a case, the veto shall not affect the item or
items which are not objected to. The vetoed item or items shall not take effect unless the
sanggunian overrides the veto in the manner herein provided; otherwise, the item or items in
the appropriations ordinance of the previous year corresponding to those vetoed, if any, shall
be deemed reenacted.
(a) Within ten (10) days after its enactment, the sangguniang barangay shall furnish copies
of all barangay ordinances to the sangguniang panlungsod or sangguniang bayan concerned
for review as to whether the ordinance is consistent with law and city or municipal
ordinances.
(b) If the sangguniang panlungsod or sangguniang bayan, as the case may be, fails to take
action on barangay ordinances within thirty (30) days from receipt thereof, the same shall be
deemed approved.
(c) If the sangguniang panlungsod or sangguniang bayan, as the case may be, finds the
barangay ordinances inconsistent with law or city or municipal ordinances, the sanggunian
concerned shall, within thirty (30) days from receipt thereof, return the same with its
comments and recommendations to the sangguniang barangay concerned for adjustment,
amendment, or modification; in which case, the effectivity of the barangay ordinance is
suspended until such time as the revision called for is effected.
Section 58. Enforcement of Disapproved Ordinances or Resolutions. - Any attempt to
enforce any ordinance or any resolution approving the local development plan and public
investment program, after the disapproval thereof, shall be sufficient ground for the
suspension or dismissal of the official or employee concerned.
Section 59. Effectivity of Ordinances or Resolutions. -
Section 22. Corporate Powers. -
(a) Every local government unit, as a corporation, shall have the following powers:
(1) To have continuous succession in its corporate name;
(2) To sue and be sued;
(3) To have and use a corporate seal;
(4) To acquire and convey real or personal property;
(5) To enter into contracts; and
(6) To exercise such other powers as are granted to corporations, subject to the limitations
provided in this Code and other laws.
(b) Local government units may continue using, modify, or change their existing corporate
seals: Provided, That newly established local government units or those without corporate
seals may create their own corporate seals which shall be registered with the Department of
the Interior and Local Government: Provided, further, That any change of corporate seal
shall also be registered as provided hereon.
(c) Unless otherwise provided in this Code, no contract may be entered into by the local chief
executive in behalf of the local government unit without prior authorization by the sanggunian
concerned. A legible copy of such contract shall be posted at a conspicuous place in the
provincial capitol or the city, municipal or barangay hall.

(c) The local chief executive may veto an ordinance or resolution only once. The sanggunian
may override the veto of the local chief executive concerned by two-thirds (2/3) vote of all its
members, thereby making the ordinance effective even without the approval of the local chief
executive concerned.
Section 56. Review of Component City and Municipal Ordinances or Resolutions by
the Sangguniang Panlalawigan.
(a) Within three (3) days after approval, the secretary to the sanggunian panlungsod or
sangguniang bayan shall forward to the sangguniang panlalawigan for review, copies of
approved ordinances and the resolutions approving the local development plans and public
investment programs formulated by the local development councils.
(b) Within thirty (30) days after the receipt of copies of such ordinances and resolutions, the
sangguniang panlalawigan shall examine the documents or transmit them to the provincial
attorney, or if there be none, to the provincial prosecutor for prompt examination. The
provincial attorney or provincial prosecutor shall, within a period of ten (10) days from receipt
of the documents, inform the sangguniang panlalawigan in writing of his comments or
recommendations, which may be considered by the sangguniang panlalawigan in making its
decision.
(c) If the sangguniang panlalawigan finds that such an ordinance or resolution is beyond the
power conferred upon the sangguniang panlungsod or sangguniang bayan concerned, it
shall declare such ordinance or resolution invalid in whole or in part. The sangguniang
panlalawigan shall enter its action in the minutes and shall advise the corresponding city or
municipal authorities of the action it has taken.
(d) If no action has been taken by the sangguniang panlalawigan within thirty (30) days after
submission of such an ordinance or resolution, the same shall be presumed consistent with
law and therefore valid.
Section 57. Review of Barangay Ordinances by the Sangguniang Panlungsod or
Sangguniang Bayan. -
(a) Unless otherwise stated in the ordinance or the resolution approving the local (d) Local government units shall enjoy full autonomy in the exercise of their proprietary
development plan and public investment program, the same shall take effect after ten (10) functions and in the limitations provided in this Code and other applicable laws,
days from the date a copy thereof is posted in a bulletin board at the entrance of the
provincial capitol or city, municipal, or barangay hall, as the case may be, and in at least two g. Liability of LGUs
(2) other conspicuous places in the local government unit concerned.
Liability of MCs
(b) The secretary to the sanggunian concerned shall cause the posting of an ordinance or
resolution in the bulletin board at the entrance of the provincial capitol and the city, Liability for Torts
municipal, or barangay hall in at least two (2) conspicuous places in the local government Palafox vs. Province of Ilocos Norte
unit concerned not later than five (5) days after approval thereof. Torio vs. Fontanilla
The text of the ordinance or resolution shall be disseminated and posted in Filipino or Exceptions:
English and in the language understood by the majority of the people in the local government New Civil Code. Art. 2189. Provinces, cities and municipalities shall be liable for damages
unit concerned, and the secretary to the sanggunian shall record such fact in a book kept for for the death of, or injuries suffered by, any person by reason of the defective condition of
the purpose, stating the dates of approval and posting. roads, streets, bridges, public buildings, and other public works under their control or
supervision.
(c) The gist of all ordinances with penal sanctions shall be published in a newspaper of
general circulation within the province where the local legislative body concerned belongs. In
Section 24. Liability for Damages. - Local government units and their officials are not
the absence of any newspaper of general circulation within the province, posting of such
exempt from liability for death or injury to persons or damage to property.
ordinances shall be made in all municipalities and cities of the province where the
sanggunian of origin is situated.
City of Manila vs. IAC 179 S 428
(d) In the case of highly urbanized and independent component cities, the main features of Jimenez vs. City of Manila 150 S 510
the ordinance or resolution duly enacted or adopted shall, in addition to being posted, be
published once in a local newspaper of general circulation within the city: Provided, That in h. Settlement of Boundary Disputes (see above)
the absence thereof the ordinance or resolution shall be published in any newspaper of i. Discipline of Local Elective Officials (see above)
general circulation. i. Grounds
ii. Jurisdiction
f. Corporate Powers iii. Preventive Suspension
i. To Sue and be sued iv. Removal
ii. To acquire and sell property v. Administrative Appeal
iii. To enter into contracts: requisites & ultra vires vi. Doctrine of Condonation
contracts j. Recall

Law on Public Corporations and Officers | 6

 only upon the election and proclamation of a successor in the person of the candidate
Section 69. By Whom Exercised. - The power of recall for loss of confidence shall be receiving the highest number of votes cast during the election on recall. Should the official
exercised by the registered voters of a local government unit to which the local elective sought to be recalled receive the highest number of votes, confidence in him is thereby
official subject to such recall belongs. affirmed, and he shall continue in office.

Section 70. Initiation of the Recall Process. - Section 73. Prohibition from Resignation. - The elective local official sought to be recalled
shall not be allowed to resign while the recall process is in progress.
(a) Recall may be initiated by a preparatory recall assembly or by the registered voters of the
local government unit to which the local elective official subject to such recall belongs. Section 74. Limitations on Recall. -

(b) There shall be a preparatory recall assembly in every province, city, district, and (a) Any elective local official may be the subject of a recall election only once during his term
municipality which shall be composed of the following: of office for loss of confidence.

(1) Provincial level. - All mayors, vice-mayors, and sanggunian members of the (b) No recall shall take place within one (1) year from the date of the official's assumption to
municipalities and component cities; office or one (1) year immediately preceding a regular local election.
(2) City level. - All punong barangay and sanggunian barangay members in the city;
(3) Legislative District level. - In case where sangguniang panlalawigan members are elected Section 75. Expenses Incident to Recall Elections. - All expenses incident to recall
by district, all elective municipal officials in the district; and in cases where sangguniang elections shall be borne by the COMELEC. For this purpose, there shall be included in the
panlungsod members are elected by district, all elective barangay officials in the district; and annual General Appropriations Act a contingency fund at the disposal of the COMELEC for
(4) Municipal level. - All punong barangay and sangguniang barangay members in the the conduct of recall elections.
municipality.
k. Term Limits
(c) A majority of all the preparatory recall assembly members may convene in session in a
public place and initiate a recall proceedings against any elective official in the local
government unit concerned. Recall of provincial, city, or municipal officials shall be validly
initiated through a resolution adopted by a majority of all the members of the preparatory
recall assembly concerned during its session called for the purpose.

(d) Recall of any elective provincial, city, municipal, or barangay official may also be validly
initiated upon petition of at least twenty-five percent (25%) of the total number of registered
voters in the local government unit concerned during the election in which the local official
sought to be recalled was elected.

(1) A written petition for recall duly signed before the election registrar or his representative,
and in the presence of a representative of the petitioner and a representative of the official
sought to be recalled and, and in a public place in the province, city, municipality, or
barangay, as the case may be, shall be filed with the COMELEC through its office in the
local government unit concerned. The COMELEC or its duly authorized representative shall
cause the publication of the petition in a public and conspicuous place for a period of not less
than ten (10) days nor more than twenty (20) days, for the purpose of verifying the
authenticity and genuineness of the petition and the required percentage of voters.

(2) Upon the lapse of the aforesaid period, the COMELEC or its duly authorized
representative shall announce the acceptance of candidates to the position and thereafter
prepare the list of candidates which shall include the name of the official sought to be
recalled.

Section 71. Election on Recall. - Upon the filing of a valid resolution or petition for recall
with the appropriate local office of the COMELEC, the Commission or its duly authorized
representative shall set the date of the election on recall, which shall not be later than thirty
(30) days after the filing of the resolution or petition for recall in the case of the barangay,
city, or municipal officials. and forty-five (45) days in the case of provincial officials. The
official or officials sought to be recalled shall automatically be considered as duly registered
candidate or candidates to the pertinent positions and, like other candidates, shall be entitled
to be voted upon.

Section 72. Effectivity of Recall. - The recall of an elective local official shall be effective

Law on Public Corporations and Officers | 7

 LAW ON PUBLIC OFFICERS Can a de jure officer recover the salary from the de facto officer?
14. Frequent unauthorized absences or tardiness in reporting for duty, loafing or frequent
Definition Cases unauthorized absences from duty during regular office hours;
Distinguished from contract Arimao vs. Taher 498 S 76
Elements of Public Office Menzon vs. Petilla 197 S 251 15. Habitual drunkenness;
Basic Precept underlying public office: Civil Liberties Union vs. Executive Secretary 194 S 317
Malaluan vs. COMELEC 254 S 400 16. Gambling prohibited by law;
1987 Consti. Art. XI. Section 1. Public office is a public trust. Public officers and employees Tarrosa vs. Singson 232 S 553
must, at all times, be accountable to the people, serve them with utmost responsibility, Mendoza vs. Allas 302 S 623 17. Refusal to perform official duty or render overtime service;
integrity, loyalty, and efficiency; act with patriotism and justice, and lead modest lives. Liban vs. Gordon 593 S 68
Engano vs. CA 493 S 324 18. Disgraceful, immoral or dishonest conduct prior to entering the service;
Meaning of Principle Gaminde vs. COA 12/13/00
National Amnesty Commission vs. COA 437 S 670 19. Physical or mental incapacity or disability due to immoral or vicious habits;
Cases
Laurel vs. Desierto 381 S 48 Civil Service 20. Borrowing money by superior officers from subordinates or lending by subordinates to
ABAKADA Guro Party List vs. Purisima 562 S 251 superior officers;
Figueroa vs. People 498 S 298 1987 Consti. Art. IX-B. Section 2.
Javier vs. Sandiganbayan 599 S 325 X X X 21. Lending money at usurious rates of interest;
Lagman vs. Ochoa & Biraogo vs. PTC 637 S 78 3. No officer or employee of the civil service shall be removed or suspended except for
cause provided by law. 22. Willful failure to pay just debts or willful failure to pay taxes due to the government;
Characteristics of Public Office:
PD 807. Section 36. Discipline: General Provisions. 23. Contracting loans of money or other property from persons with whom the office of the
Segovia vs. Noel 47 P 543
employee concerned has business relations;
Abeja vs. Tanada & Mayor Radovan 236 S 62
Mayor De Castro vs. COMELEC & Jamilla 267 S 806 (a) No officer or employee in the Civil Service shall be suspended or dismissed except for
cause as provided by law and after due process. 24. Pursuit of private business, vocation or profession without the permission required by
Civil Service rules and regulations;
Oath of Office:
(b) The following shall be grounds for disciplinary action:
Mendoza vs. Laxina 406 S 156 25. Insubordination;
Ombudsman vs. Jurado 561 S 137
1. Dishonesty;
26. Engaging directly or indirectly in partisan political activities by one holding non-political
General Rule: Individuals cannot be forced to accept public office 2. Oppression; office;
Exceptions:
3. Neglect of duty; 27. Conduct prejudicial to the best interest of the service;
1987 Consti. Art. II. Section 4. The prime duty of the Government is to serve and protect
the people. The Government may call upon the people to defend the State and, in the 4. Misconduct; 28. Lobbying for personal interest or gain in legislative halls and offices without authority;
fulfillment thereof, all citizens may be required, under conditions provided by law, to render
personal, military or civil service. 5. Disgraceful and immoral conduct; 29. Promoting the sale of tickets in behalf of private enterprises that are not intended for
charitable or public welfare purposes and even in the latter cases if there is no prior
RPC. Article 234. Refusal to discharge elective office. - The penalty of arresto mayor or a 6. Being notoriously undesirable; authority;
fine not exceeding 1,000 pesos, or both, shall be imposed upon any person who, having
been elected by popular election to a public office, shall refuse without legal motive to be 7. Discourtesy in the course of official duties; 30. Nepotism as defined in Section 49 of this Decree.
sworn in or to discharge the duties of said office.
8. Inefficiency and incompetence in the performance of official duties; (c) Except when initiated by the disciplining authority, no complaint against a civil service
Posse Comitatus official or employee shall be given due course unless the same is in writing and subscribed
9. Receiving for personal use of a fee, gift or other valuable thing in the course of official and sworn to by the complainant.
Classifying Public Officers of GOCCs under RA 3019 duties or in connection therewith when such fee, gift, or other valuable thing is given by any
person in the hope or expectation of receiving a favor or better treatment than that accorded (d) In meting out punishment, the same penalties shall be imposed for similar offenses and
Macalino vs. Sandiganbayan 376 S 452 other persons, or committing acts punishable under the anti-graft laws; only one penalty shall be imposed in each case. The disciplining authority may impose the
People vs. Sandiganbayan 2/16/05 penalty of removal from the service, transfer, demotion in rank, suspension for not more than
Geduspan vs. People 451 S 187 10. Conviction of a crime involving moral turpitude; one year without pay, fine in an amount not exceeding six months' salary, or reprimand.
Alzaga vs. Sandiganbayan 505 S 849
11. Improper or unauthorized solicitation of contributions from subordinate employees and by EO 292. Section 14. (Same as above)
De Facto Officer teachers or school officials from school children;
Definition Purpose of the Civil Service System
Requisites 12. Violation of existing Civil Service Law and rules or reasonable office regulations;
Distinguish from a de jure officer and a usurper Meram vs. Edralin 154 S 238
Can an officer de jure recover from the government salary paid to de facto officer? 13. Falsification of official document;
Law on Public Corporations and Officers | 8
Scope:
1987 Consti. Art. IX-B. Section 2.
1. The civil service embraces all branches, subdivisions, instrumentalities, and agencies
of the Government, including government-owned or controlled corporations with
original charters.
Corsiga vs. Defensor 391 S 267
Go vs. CA 626 S 180
Law on Administrative Jurisdiction vs. Public School Teachers
RA 4670. Sec. 9. Administrative Charges. Administrative charges against a teacher shall be
heard initially by a committee composed of the corresponding School Superintendent of the
Division or a duly authorized representative who should at least have the rank of a division
supervisor, where the teacher belongs, as chairman, a representative of the local or, in its
absence, any existing provincial or national teacher's organization and a supervisor of the
Division, the last two to be designated by the Director of Public Schools. The committee shall
submit its findings and recommendations to the Director of Public Schools within thirty days
from the termination of the hearings: Provided, however, That where the school
superintendent is the complainant or an interested party, all the members of the committee
shall be appointed by the Secretary of Education.
RA 4670. Sec. 2. …the term "teacher" shall mean all persons engaged in classroom
teaching, in any level of instruction, on full-time basis, including guidance counselors, school
librarians, industrial arts or vocational instructors, and all other persons performing
supervisory and/or administrative functions in all schools, colleges and universities operated
by the Government or its political subdivisions; but shall not include school nurses, school
physicians, school dentists, and other school employees.
Cases
Emin vs. de Leon 378 S 143
Ampong vs. CSC 563 S 293
Omb vs. Estandarte 4/13/07
Omubudsman vs. Masing 542 S 253
Omubudsman vs. Delijero 10/10/10
Higher Education Modernization Act of 1997
RA 8292. Section 4. Powers and duties of Governing Boards. – The governing board
shall have the following specific powers and duties in addition to its general powers of
administration and the exercise of all the powers granted to the board of directors of a
corporation under Section 36 of Batas Pambansa Blg. 68 otherwise known as the
Corporation Code of the Philippines;
(a) to enact rules and regulations not contrary to law as may be necessary to carry to carry
out the purposes and functions of the university or college;
(b) to receive and appropriate all sums as may be provided, for the support of the university
or college in the manner it may determine, in its discretion, to carry out the purposes and
functions of the university or college;
(c) to receive in trust legacies, gifts and donations of real and personal properties of all kinds,
to administer and dispose the same when necessary for the benefit of the university or
college, subject to limitations, directions and instructions of the donors, if any. Such
donations shall be exempt from all taxes and shall be considered as deductible items from
the income tax of the donor: Provided, however, That the rights, privileges and exemptions
extended by this Act shall likewise be extended to non-stock, non-profit private universities
and colleges: Provided, finally, That the same privileges shall also be extended to city
colleges and universities with the approval of the local government to city colleges and
universities with the approval of the local government unit concerned and in coordination
with the CHED;
(d) to fix the tuition fees and other necessary school charges, such as but not limited
matriculation fees, graduation fees and laboratory fees, as their respective boards may deem
proper to impose after due consultations with the involved sectors.
Such fees and charges, including government subsidies and other income generated by the
university or college, shall constitute special trust funds and shall be deposited in any
authorized government depository bank, and all interests shall accrue therefrom shall part of
the same fund for the use of the university or college: Provided, That income derived from
university hospitals shall be exclusively earmarked for the operating expenses of the
hospitals.
Any provision of existing laws, rules and regulations to the contrary notwithstanding, any
income generated by the university or college from tuition fees and other charges, as well as
from the operation of auxiliary services and land grants, shall be retained by the university or
college, and may be disbursed by the Board of Regents/Trustees for instruction, research,
extension, or other programs/projects of the university or college: Provided, That all fiduciary
fees shall be disbursed for the specific purposes for which they are collected.
If, for reason of control, the university or college, shall not be able to pursue any project for
which funds have been appropriated and, allocated under its approved program of
expenditures, the Board of Regents/Trustees may authorize the use of said funds for any
reasonable purpose which, in its discretion, may be necessary and urgent for the attainment
of the objectives and goals of the universities or college;
(e) to adopt and implement a socialized scheme of tuition and school fees for greater access
to poor but deserving students;
(f) to authorize the construction or repair of its buildings, machineries, equipment and other
facilities and the purchase and acquisition of real and personal properties including
necessary supplies, materials and equipment. Purchases and other transactions entered into
by the university or college through the Board of Regents/Trustees shall be exempt from all
taxes and duties;
(g) to appoint, upon the recommendation of the president of the university or college, vice
presidents, deans, directors, heads of departments, faculty members and other officials and
employees;
(h) to fix and adjust salaries of faculty members and administrative officials and employees
subject to the provisions of the revised compensation and classification system and other
pertinent budget and compensation laws governing hours of service, and such other duties
and conditions as it may deem proper; to grant them, at its discretion, leaves of absence
under such regulations as it may promulgate, any provisions of existing law to the contrary
not with standing; and to remove them for cause in accordance with the requirements of due
process of law;
(i) to approve the curricula, institutional programs and rules of discipline drawn by the
administrative and academic councils as herein provided;
(j) to set polices on admission and graduation of students;
(k) to award honorary degrees upon persons in recognition of outstanding contribution in the
field of education, public service, arts, science and technology or in any field of specialization
within the academic competence of the university or college and to authorize the award of
certificates of completion of non-degree and non-traditional courses;
(l) to absorb non-chartered tertiary institutions within their respective provinces in
coordination with the CHED and in consultation with the Department of Budget and
Management, and to offer therein needed programs or courses, to promote and carry out
equal access to educational opportunities mandated by the Constitution ;
(m) to establish research and extension centers of the SUC where such will promote the
development of the latter;
(n) to establish chairs in the university or college and to provide fellowships for qualified
faculty members and scholarships to deserving students;
(o) to delegate any of its powers and duties provided for hereinabove to the president and/or
other officials of the university or college as it may deem appropriate so as to expedite the
administration of the affairs of the university or college;
(p) to authorize an external management audit of the institution, to be financed by the CHED
and to institute reforms, including academic and structural changes, on the basis of the audit
results and recommendations;
(q) to collaborate with other governing boards of SUCs within the province or the region,
under the supervision of the CHED and in consultation with the Department of Budget and
Management, the restructuring of said colleges and universities to become more efficient,
relevant, productive, and competitive;
(r) to enter into joint ventures with business and industry for the profitable development and
management of the economic assets of the college or institution, the proceeds from which to
be used for the development and strengthening of the college or university;
(s) to develop consortia and other forms of linkages with local government units, institutions
and agencies, both public and private, local and foreign, in furtherance of the purposes and
objectives of the institution;
(t) to develop academic arrangements for institution capability building with appropriate
institutions and agencies, public or private, local or foreign, and to appoint experts/specialists
as consultants, or visiting or exchange professors, scholars, researchers, as the case may
be;
(u) to set up the adoption of modern and innovative modes of transmitting knowledge such
as the use of information technology, the dual system, open learning, community laboratory,
etc., for the promotion of greater access to higher education;
(v) to establish policy guidelines and procedures for participative decision-making and
transparency within the institution;
(w) to privatize, where most advantageous to the institution, management and non-academic
services such as health, food, building or grounds or property maintenance and similar such
other objectives; and
(x) to extend the term of the president of the college or university beyond the age of
retirement but not later than the age of seventy (70), whose performance has been
unanimously rated as outstanding and upon unanimous recommendation by the search
committee for the president of the institution concerned.
Law on Public Corporations and Officers | 9

CSC vs. Sojor 5/22/08
GOCCs not covered by Civil Service Law
Cases
PNOC-EDC vs. Leogardo 175 S 26
Bliss Development Corp. Employees Union vs. Calleja 237 S 271
PVBEU vs. PVB 8/24/90
Phil. National Construction Corp., Macalino vs. Sandiganbayan 376 S 452
Food Terminal Inc.; Lumanta vs. NLRC
Executive Order 180
I. Coverage
Sec. 1. This Executive Order applies to all employees of all branches, subdivisions,
instrumentalities, and agencies, of the Government, including government-owned or
controlled corporations with original charters. For this purpose, employees, covered by this
Executive Order shall be referred to as "government employees".
Sec. 2. All government employees can form, join or assist employees' organizations of
their own choosing for the furtherance and protection of their interests. They can also form,
in conjunction with appropriate government authorities, labor-management committees,
works councils and other forms of workers' participation schemes to achieve the same
objectives.
Sec. 3. High-level employees whose functions are normally considered as policy-
making or managerial or whose duties are of a highly confidential nature shall not be eligible
to join the organization of rank-and-file government employees.
Sec. 4. The Executive Order shall not apply to the members of the Armed Forces of the
Philippines, including police officers, policemen, firemen and jail guards.
II. Protection of the Right to Organize
Sec. 5. Government employees shall not be discriminated against in respect of their
employment by reason of their membership in employees' organizations or participation in
the normal activities of their organization. Their employment shall not be subject to the
condition that they shall not join or shall relinquish their membership in the employees'
organizations.
Sec. 6. Government authorities shall not interfere in the establishment, functioning or
administration of government employees' organizations through acts designed to place such
organizations under the control of government authority.
III. Registration of Employees' Organization
Sec. 7. Government employees' organizations shall register with the Civil Service
Commission and the Department of Labor and Employment. The application shall be filed
with the Bureau of Labor Relations of the Department which shall process the same in
accordance with the provisions of the Labor Code of the Philippines, as amended.
Applications may also be filed with the Regional Offices of the Department of Labor and
Employment which shall immediately transmit the said applications to the Bureau of Labor
Relations within three (3) days from receipt thereof.
Sec. 8. Upon approval of the application, a registration certificate be issued to the
organization recognizing it as a legitimate employees' organization with the right to represent
its members and undertake activities to further and defend its interest. The corresponding Sec. 16. The Civil Service and labor laws and procedures, whenever applicable, shall be
certificates of registration shall be jointly approved by the Chairman of the Civil Service followed in the resolution of complaints, grievances and cases involving government
Commission and Secretary of Labor and Employment. employees. In case any dispute remains unresolved after exhausting all the available
remedies under existing laws and procedures, the parties may jointly refer the dispute to the
IV. Sole and Exclusive Employees' Representatives Council, for appropriate action.
Sec. 9. The appropriate organizational unit shall be the employers unit consisting of Liban vs. Gordon 593 S 68
rank-and-file employees unless circumstances otherwise require. Liban vs. Gordon 1/18/11
Sec. 10. The duly registered employees' organization having the support of the majority GOCCs covered by the CS Law
of the employees in the appropriate organizational unit shall be designated as the sole and
exclusive representative of the employees.
BSP vs. NLRC 4/22/91; modified by BSP vs. COA 6/7/11
Baluyot vs. Holganza 2/9/00; set aside by Gordon case.
Sec. 11. A duly registered employees' organization shall be accorded voluntary
DFP vs. Mojica 471 S 76
recognition upon a showing that no other employees' organization is registered or is seeking
Alzaga vs. Sandiganbayan 505 S 848
registration, based on records of the Bureau of Labor Relations, and that the said
organizations has the majority support of the rank-and-file employees in the organizational
unit. PD 198 as amended by PD 1479 and RA 9286
Sec. 12. Where there are two or more duly registered employees' organizations in the Hagonoy Water District vs. NLRC 165 S 272
appropriate organizational unit, the Bureau of Labor Relations shall, upon petition, order the DCWD vs. CSC 201 S 605
conduct of a certification election and shall certify the winner as the exclusive representative
of the rank-and-file employees in said organization unit. COA Audit of GOCCs
V. Terms and Conditions of Employment in Government Services de Jesus vs. COA 403 S 666
BSP vs. COA 6/7/11
Sec. 13. Terms and conditions of employment or improvements thereof, except those PNOC-EDC vs. NLRC 222 S 831
that are fixed by law, may be the subject of negotiations between duly recognized ZCWD vs. Buat 232 S 587 (erroneous ruling)
employees' organizations and appropriate government authorities. DOH Dr. Rodriguez Hospital vs. NLRC 251 S 700
Intia, Jr. vs. COA 306 S 610
VI. Peaceful Concerted Activities and Strikes PRA vs. Bunag 397 S 27
Sec. 14. The Civil Service laws and rules governing concerted activities and strikes in the GOCC Governance Act if 2011
government service shall be observed, subject to any legislation that may be enacted by
Congress. SECTION 1. Short Title.—This Act shall be known as the “GOCC Governance Act of 2011″.
VII. Public Sector Labor-Management Council
SEC. 2. Declaration of Policy.—The State recognizes the potential of government-owned or -
controlled corporations (GOCCs) as significant tools for economic development. It is thus the
Sec. 15. A Public Sector Labor Management Council, hereinafter referred to as the policy of the State to actively exercise its ownership. rights in GOCCs and to promote growth
Council, is hereby constituted to be composed of the following:
by ensuring that operations are consistent with national development policies and programs.
1) Chairman, Civil Service Commission Chairman Towards this end, the State shall ensure that:
2) Secretary, Department of Labor and Employment Vice Chairman
(a) The corporate form of organization through which government carries out activities is
utilized judiciously;
3) Secretary, Department of Finance Member
(b) The operations of GOCCs are rationalized and monitored centrally in order that
4) Secretary, Department of Justice Member government assets and resources are used efficiently and the government exposure to all
forms of habilities including subsidies is warranted and incurred through prudent means;
5) Secretary, Department of Budget and Management Member
(c) The governance of GOCCs is carried out in a transparent, responsible and accountable
The Council shall implement and administer the provisions of this Executive Order. For this manner and with the utmost degree of professionalism and effectiveness;
purpose, the Council shall promulgate the necessary rules and regulations to implement this
Executive Order.
(d) A reporting and evaluation system, which will require the periodic disclosure and
examination of the operations and management of the GOCCs, their assets and finances,
VIII. Settlement of Disputes revenues and expenditures, is enforced;
Law on Public Corporations and Officers | 10
(e) The governing boards of every GOCC and its subsidiaries are competent to carry out its
functions, fully accountable to the State as its fiduciary, and acts in the best interest of the
State;
(f) Reasonable, justifiable and appropriate remuneration schemes are adopted for the
directors/trustees, officers and employees of GOCCs and their subsidiaries to prevent or
deter the granting of unconscionable and excessive remuneration packages; and
(g) There is a clear separation between the regulatory and proprietary activities of GOCCs,
in order to achieve a level playing field with corporations in the private sector performing
similar commercial activities for the public.
SEC. 3. Definition of Terms.—
(a) Affiliate refers to a corporation fifty percent (50%) or less of the outstanding capital stock
of which is owned or controlled, directly or indirectly, by the GOCC.
(b) Appointive Director refers to:
(1) In the case of chartered GOCCs, all members of its Board of Directors/Trustees who are
not ex officio members thereof;
(2) In the case of nonchartered GOCCs, members of its Board of Directors/Trustees whom
the State is entitled to nominate, to the extent of its percentage shareholdings in such
GOCC; and
(3) In the case of subsidiaries and affiliates, members of its Board of Directors/Trustees
whom the GOCC is entitled to nominate to the extent of its perrcentage shareholdings in
such subsidiary or affiliate.
(c) Board of Directors/Trustees or Board refers to the governing body that exercises the
corporate powers of a GOCC.
(d) Breakthrough Results refer to the achievement of corporate goals or other performance
indicators as determined by the GOCC or its supervising department.
(e) Charter Statement refers to a statement of the GOCC’s vision, mission and core values.
(f) Chartered GOCC refers to a GOCC, including Government Financial Institutions, created
and vested with functions by a special law.
(g) Chief Executive Officer (CEO) refers to the highest ranking corporate executive, who
could be the President or the General Manager, Chairman or the Administrator of a GOCC.
(h) Department refers to an executive department created by law. This shall include any
instrumentality having or assigned the rank of a department, regardless of its name or
designation.
(i) Ex Officio Board Member refers to any individual who sits or acts as a member of the
Board of Directors/ Trustees by virtue of one’s title to another office, and without further
warrant or appointment.
(j) Fit and Proper Rule refers to the standard for determining whether a member of the Board
of Directors/ Trustees or CEO is fit and proper to hold a position in a GOCC which shall
include, but not be limited to, standards on integrity, experience, education, training and
competence.
(k) Government Agency refers to any of the various units of the Government of the Republic
of the Philippines, including a department, bureau, office, instrumentality or GOCC, or a local
government or a distinct unit therein.
(l) Government Corporate Governance Standards refer to a set of principles derived from law
and practices, rules and standards prescribed by the Governance Commission for
Government-Owned or -Controlled Corporations (GCG) that generate long-term arid
desirable economic value for the State. It shall also refer to a system whereby shareholders,
creditors, and other stakeholders of a corporation ensure that management enhances the
value of the corporation as it competes in an increasingly global market place.
(m) Government Financial Institutions (GFIs) refer to financial institutions or corporations in
which the government directly or indirectly owns majority of the capital stock and. which are
either: (1) registered with or directly supervised by the Bangko Sentral ng Pilipinas; or (2)
collecting or transacting funds or contributions from the public and places them in financial
instruments or assets such as deposits, loans, bonds and equity including, but not limited to,
the Government Service Insurance System and the Social Security System.
(n) Government Instrumentalities with Corporate Powers (GICP)/Government Corporate
Entities (GCE) refer to instrumentahties or agencies of the government, which are neither
corporations nor agencies integrated within the departmental framework, but vested by law
with special functions or jurisdiction, endowed with some if not all corporate powers,
administering special funds, and enjoying operational autonomy usually through a charter
including, but not limited to, the following: the Manila International Airport Authority (MIAA),
the Philippine Ports Authority (PPA), the Philippine Deposit Insurance Corporation (PDIC),
the Metropolitan Waterworks and Sewerage System (MWSS), the Laguna Lake
Development Authority (LLDA), the Philippine Fisheries Development Authority (PFDA), the
Bases Conversion and Development Authority (BCDA), the Cebu Port Authority (CPA), the
Cagayan de Orb Port Authority, the San Fernando Port Authority, the Local Water Utilities
Administration (LWUA) and the Asian Productivity Organization (APO).
(o) Government-Owned or -Controlled Corporation (GOCC) refers to any agency organized
as a stock or nonstock corporation, vested with functions relating to public needs whether
governmental or proprietary in nature, and owned by the Government of the Republic of the
Philippines directly or through its instrumentahties either wholly or, where applicable as in
the case of stock corporations, to the extent of at least a majority of its outstanding capital
stock: Provided, however, That for purposes of this Act, the term “GOCC”- shall include
GICP/GCE and GFI as defined herein.
(p) Nonchartered GOCC refers to a GOCC organized and operating under Batas Pambansa
Bilang 68, or “The Corporation Code of the Philippines”.
(q) Officers refer to the corporate officers of the GOCC as provided in its charter or bylaws,
such as the CEO, Chief Financial Officer, Chief Investment Officer, President, Vice
President, General Manager, Treasurer and Corporate Secretary.
(r) Ownership Manuals refer to guidelines and rules pertaining to the ownership by the State
or corporations and enterprises or the exercise of such ownership governing the GOCCs or
any classification thereof.
(s) Per Diems refer to the compensation granted to members of the Board of Directors or
Trustees of a GOCC for actual attendance in meetings.
(t) Performance Evaluation System refers to the process of appraising the accomplishments
of GOCCs in a given fiscal year based, on set performance criteria, targets and weights.
(u) Performance Scorecard refers to a governance and management tool forming part of the
performance evaluation system which consists of a set of measures, targets and. initiatives
that facilitate the achievement of breakthrough results and performance through the effective
and efficient monitoring and coordination of the strategic objectives of the GOCC.
(v) President refers to the President of the Republic of the Philippines.
(w) Related Corporation refers to a subsidiary or affiliate of a GOCC.
(x) Secretary refers to the person vested with the authority and responsibility for the exercise
of the mandate of the Department, for the discharge of its powers and functions, and who
shall have supervision and control of the Department.
(y) Strategy Map refers to an integrated set of strategic choices or objectives drawn by the
governing body, the successful execution of which results in the achievement of the GOCC’s
vision in relation to its mission or purpose for having been created.
(z) Subsidiary refers to a corporation where at least a majority of the outstanding capital
stock is owned or controlled, directly or indirectly, through one or more intermediaries, by the
GOCC.
SEC. 4. Coverage.—This Act shall be applicable to all GOCCs, GICPs/GCEs, and
government financial institutions, including their subsidiaries, but excluding the Bangko
Sentral ng Pihpinas, state universities and colleges, cooperatives, local water districts,
economic zone authorities and research institutions: Provided, That in economic zone
authorities and research institutions, the President shall appoint one-third (1/3) of the board
members from the list submitted by the GCG.
CHAPTER II
The Governance Commission for Government-Owned or -Controlled Corporations (GCG)
SEC. 5. Creation of the Governance Commission for Government-Owned or -Controlled
Corporations.—There is hereby created a central advisory, monitoring, and oversight body
with authority- to formulate, implement and coordinate policies to be known as the
Governance Commission for Government-Owned or -Controlled Corporations, hereinafter
referred to as the GCG, which shall be attached to the Office of the President. The GCG
shall have the following powers and functions:
(a) Evaluate the performance and determine the relevance of the GOCC, to ascertain
whether such GOCC should be reorganized, merged, streamlined, abolished or privatized, in
consultation with the department or agency to which a GOCC is attached. For this purpose,
the GCG shall be guided by any of the following standards:
(1) The functions or purposes for which the GOCC was created are no longer relevant to the
State or no longer consistent with the national development policy of the State;
(2) The GOCC’s functions or purposes duplicate or unnecessarily overlap with functions,
programs, activities or projects already provided by a Government Agency;
(3) The GOCC is not producing the desired outcomes, or no longer achieving the objectives
and purposes for which it was originally designed and implemented, and/or not cost efficient
and does not generate the level of social, physical and economic returns vis-à-vis the
resource inputs;
(4) The GOCC is in fact dormant or nonoperational;
(5) The GOCC is involved in an activity best carried out by the private sector; and
Law on Public Corporations and Officers | 11

(6) The funcitional, purpose or nature of operations of any group of GOCCs require
consolidation under a holding company.
Upon determination by the GCG that it is to the best interest of the State that a GOCC
should be reorganized, merged, streamlined, abolished or privatized, it shall:
(i) Implement the reorganization, merger or streamlining of the GOCC, unless otherwise
directed by the President; or
(ii) Recommend to the President the abolition or privatization of the GOCC, and upon the
approval of the President, implement such abolition or privatization, unless the President
designates another agency to implement such abolition or privatization.
(b) Classify GOCCs into: (1) Developmental/Social Corporations; (2) Proprietary Commercial
Corporations; (3) Government Financial, Investment and Trust Institutions; (4) Corporations
with Regulatory Functions; and (5) Others as may be classified by the GCG, without
prejudice to further sub classifications in each category and/or any other classification based
on parameters as it may find relevant or . material such as, but not limited to, industry type.
The classification shall guide the GCG in exercising its powers and functions as provided
herein;
(c) In consultation with the relevant government agencies and stakeholders, adopt within one
hundred eighty (180) days from its constitution, an ownership and operations manual and the
government corporate standards governing GOCCs: Provided, That the government
corporate governance standards applicable to GOCCs shall be no less rigorous than those
required by the Philippine Stock Exchange or the Securities. and Exchange Commission of
listed companies, or those required by the Bangko Sentral ng Pilipinas or the Insurance
Commission for banking institutions and insurance companies, as the case may be. The
manual shall be consistent with the Medium-Term Philippine Development Plan issued by
the National Economic and Development Authority (NEDA) and shall include:
(1) Objectives of State ownership;
(2) Role of national government in the governance of GOCCs;
(3) Modes of implementation of the ownership policy;
(4) Guidelines on the monitoring of the operations of all GOCCs including their Related
Corporations. These shall include Strategy Maps, Charter Statements, Performance
Commitments and such other mechanisms;
(5) The roles, relationships and responsibilities of the State, the Government Agencies to
which the GOCC is attached, and the GOCC;
(6) Disclosure and transparency requirements;
(7) Code of Ethics of Directors and Officers;
(8) Creation of board committees and similar oversight bodies;
(9) Integrated corporate reporting system;
(10) Statement of the social responsibilities of the GOCC; and
(11) Such other matters as the GCG may deem proper to include in the ownership policy.
(d) Without prejudice to the filing of administrative and criminal charges, recommend to the
Board of Directors or Trustees the suspension of any member of the Board of Directors or
Trustees who participated by commission or omission in the approval of the act giving rise to
the violation or noncompliance with the ownership manual for a period depending on the
nature and extent of damage caused, during which period the director or trustee shall not be
entitled to any emolument;
(e) In addition to the qualifications required under the individual charter of the GOCCs and in
the bylaws of GOCCs. without original charters, the GCG shall identify necessary skills and
qualifications required for Appointive Directors and recommend to the President a shortlist of
suitable and qualified candidates for Appointive Directors;
(f) Establish the performance evaluation systems including performance scorecards which
shall apply to all GOCCs in general and to the various GOCC classification;
(g) Conduct periodic study, examination, evaluation and assessment of the performance of
the GOCCs, receive, and in appropriate cases, require reports on the operations and
management of the GOCCs including, but not limited to, the management of the assets and
finances of the GOCCs;
(h) Conduct compensation studies, develop and recommend to the President a competitive
compensation and remuneration system which shall attract and retain talent, at the same
time allowing the GOCC to be financially sound and sustainable;
(i) Provide technical advice and assistance to the government agencies to which the GOCCs
are attached in setting performance objectives and targets for the GOCCs and in monitoring
GOCCs performance vis-a-vis established objectives and targets;
(j) Coordinate and monitor the operations of GOCCs, ensuring alignment and consistency
with the national development policies and programs. It shall meet at least quarterly to:
(1) Review Strategy Maps and Performance Scorecards of all GOCCs;
(2) Review and assess existing performance-related policies including the
compensation/remuneration of Board of Directors/ Trustees and Officers and recommend
appropriate revisions and actions; and
(3) Prepare performance reports of the GOCCs for submission to the President.
(k) Prepare a semi-annual progress report to be submitted to the President and the
Congress. In its report, the GCG will provide its performance assessment of the GOCCs and
recommend clear and specific actions. Within one hundred twenty (120) days from the close
of the year, the GCG shall prepare an annual report on the performance of the GOCCs and
submit it to the President and the Congress; and
(l) Review the functions of each of the GOCC and, upon determination that there is a conflict
between the regulatory and commercial functions of a GOCC, recommend to the President
in consultation with the Government Agency to which such GOCC is attached, the
privatization of the GOCCs commercial operations, or the transfer of the regulatory functions
to the appropriate government agency, or such other plan of action to ensure that the
commercial functions of the GOCC do not conflict with such regulatory functions.
In the performance of its functions under subsections (a), (c), (e), (f), (g), (h) and (1) herein
and in any other review or evaluation of a GOCC that the GCG may conduct, the GCG shall
engage the participation of the Secretary or highest ranking official of the relevant agency or
department, as the case may be.
SEC. 6. Composition of the GCG.—The GCG shall be composed of five (5) members. The
Chairman with the rank of Cabinet Secretary and two (2) members with the rank of
Undersecretary shall be appointed by the President. The Secretaries of the Department of
Budget and Management and the Department of Finance shall sit as ex officio members.
SEC. 7. Powers and Functions of the Chairman.—The management of the GCG shall be
vested in the Chairman who shall have the following powers and duties:
(a) Preside over the meetings of the GCG;
(b) Direct and manage the day-to-day affairs and business of the GCG;
(c) With the approval of the GCG, determine the staffing pattern and the number of
personnel of the GCG and define their duties and responsibilities;
(d) With the approval of the GCG, to appoint, remove, suspend, or otherwise discipline for
cause, any employee of the GCG; and
(e) Perform such other duties as may be delegated or assigned to him by the GCG from
tome to time.
CHAPTER III
COMPENSATION AND POSITION CLASSIFICATION SYSTEM FOR GOCCS
SEC. 8. Coverage of the Compensation and Position Classification System.—The GCG,
after conducting a compensation study, shall develop a Compensation and Position
Classification System which shall apply to all officers and employees of the GOCCs whether
under the Salary Standardization Law or exempt therefrom and shall consist of classes of
positions grouped into such categories as the GCG may determine, subject to approval of
the President.
SEC. 9. Position Titles and Salary Grades.—All positions in the Positions Classification
System, as determine by the GCG and as approved by the President, shall be allocated to
their proper position titles and salary grades in accordance with n Index of Occupational
Services, Position Titles and Salary Grades of the Compensation and Position Classification
System, which shall be prepared by the GCG and approved by the President.
The following principles shall govern the Compensation and Position Classification System:
(a) All GOCC personnel shall be paid just and equitable wages in accordance with the
principle of equal pay for work of equal value. Differences in pay shall be based on verifiable
Compensation and Position Classification factors in due regard to the financial capability of
the GOCC;
(b) Basic compensation for all personnel in the GOCC shall generally be comparable with
those in the private sector doing comparable work and must be in accordance with prevailing
laws on minimum wages. The total compensation provided for GOCC personnel shall be
maintained at a reasonable level with due regard to the provisions of existing compensation
and position classification laws including Joint Resolution No. 4, Series of 2009, and the
GOCC operating budget; and
(c) A review of the GOCC compensation rates, taking into account the performance of the
GOCC, its overall contribution to the national economy and the possible erosion in
purchasing power due to inflation and other factors, shall be conducted periodically.
Any law to the contrary notwithstanding, no GOCC shall be exempt from the coverage of the
Law on Public Corporations and Officers | 12
Compensation and Position Classification System developed by the GCG under this Act.
SEC. 10. Additional Incentives.—The GCG may recommend to the President, incentives for
certain position titles in consideration of the good performance of the GOCC: Provided, That
no incentives shall be granted unless the GOCC has fully paid all taxes for which it is liable,
and the GOCC has declared and paid all the dividends required to be paid under its charter
or any other laws.
SEC. 11. Non-diminution of Salaries.—The Compensation and Position Classification
System to be developed and recommended by the GCG and as approved by the President
shall apply to all positions, on full or part-time basis, now existing or hereafter created in the
GOCC: Provided, That in no case shall there be any diminution in the authorized salaries as
of December 31, 2010 of incumbent employees of GOCCs, including those exempt under
Republic Act No. 6758, as amended, upon the implementation of the Compensation and
Position Classification System for GOCCs.
CHAPTER IV
BOARD OF DIRECTORS-TRUSTEES-OFFICERS OF GOVERNMENET-OWNED OR –
CONTROLLED CORPORATIONS
SEC. 12. Coverage.—The duties, obligations, responsibilities and standards of care provided
under this Chapter shall be applicable to all members of the Board of Directors/Trustees and
Officers of GOCCs and subsidiaries now existing or hereafter created including government
appointed directors in affiliate corporations. These duties, obligations and responsibilities
shall be addition to the powers and functions provided in the individual charters or articles of
incorporation and by laws of the respective GOCCs.
SEC. 13. Number of Directors/Trustees.—The present number of Directors/Trustees
provided in the charter of the GOCCs shall be maintained.
SEC. 14. Ex Officio Alternates.—The ex officio members of the GOCC may designate their
respective alternates who shall be the officials next-in-rank to them and whose acts shall be
considered the acts of their principals.
SEC. 15. Appointment of the Board of Directors/Trustees of GOCCs.—An Appointive
Director shall be appointed by the President of the Philippines from a shortlist prepared by
the GCG.
The GCG shall formulate its rules and criteria in the selection and nomination of prospective
appointees and shall cause the creation of search committees to achieve the same. All
nominees included in the list submitted by the GCG to the President shall meet the Fit and
Proper Rule as defined un this Act and such other qualifications which the GCG may
determine taking into consideration the unique requirements of each GOCC. The GCG shall
ensure that the shortlist shall exceed by at least fifty percent (50%) of the number of
directors /trustees to be appointed. In the event that the President does not see fit to appoint
any of the nominees included in the shortlist, the President shall ask the GCG to submit
additional nominees.
SEC. 16. Fit and Proper.—All members of the Board, the CEO and other officers of the
GOCCs including appointive directors in subsidiaries and affiliate corporations shall be
qualified by the Fit and Proper Rule to be determined by the GCG in consultation and
coordination with the relevant government agencies to which the GOCC is attached and
approved by the President.
To maintain the quality of management of the GOCCs, the GCG, in coordination with he
relevant government agencies shall, subject to the approval of the President, prescribe, pass
upon and review the qualifications and disqualifications of individuals appointed as officers,
directors or elected CEO of the GOCC and shall disqualify those found unfit.
In determining whether an individual is fit and proper to hold the position of an officer,
director or CEO of the GOCC, due regard shall be given to one’s integrity, experience,
education, training and competence.
SEC. 17. Term of Office.—Any provision in the charters of each GOCC to the contrary
notwithstanding, the term of office of each Appointive Director shall be for one (1) year,
unless sooner removed for cause: Provided, however, That the Appointive Director shall
continue to hold office until the successor is appointed. An Appointive Director may be
nominated bz the GCG for reappointment by the President only if one obtains a performance
score of above average or its equivalent or higher in the immediately preceding year of
tenure as Appointive Director based on the performance criteria for Appointive Directors for
the GOCC.
Appointed to any vacancy shall be only for the unexpired term of the predecessor. The
appointment of a director to fill such vacancy shall be in accordance with the manner
provided in Section 15 of this Act.
Any provision of law to the contrary notwithstanding, all incumbent CEOs and appointive
members of the Board of GOCCs shall, upon approval of this Act, have a term of office until
June 30, 2011, unless sooner replaced by the President: Provided, however, That the
incumbent CEOs and appointive members of the Board shall continue in office until the
successor have been appointed by the President.
SEC. 18. The Chief Executive Officer of the GOCC.—The CEO or the highest-ranking officer
provided in the charters of the GOCCs, shall be elected annually bz the members of the
Board from among its ranks. The CEO shall be subject to the disciplinary powers of the
Board and may be removed by the Board for cause.
SEC. 19. Fiduciary Duties of the Board and Officers.—As fiduciaries of the State, members
of the Board of Directors/Trustees and the Officers of GOCCs have the legal obligation and
duty to always act in the best interest of the GOCC, with utmost good faith in all its dealings
with the property and monies of the GOCC.
The members of the Board and Officers of GOCCs shall:
(a) Act with utmost and undivided loyalty to the GOCC;
(b) Act with due care, extraordinary diligence, skill and good faith in the conduct of the
business of the GOCC;
(c) Avoid conflicts of interest and declare an interest they may have in any particular matter
before the Board;
(d) Apply sound business principles to ensure the financial soundness of the GOCC; and
(e) Elect and/or employ only Officers who are fit and proper to hold such office with due
regard to the qualifications, competence, experience and integrity
Where a member of the Board or an Officer, by virtue of the office, acquires or by virtue of
the office, acquires or receives for oneself a benefit or profit, of whatever kind or nature
including, but not limited to, the acquisition of shares in corporations where the GOCC has
an interest, using the properties of the GOCC for their own benefit, receiving commission on
contracts from the GOCC’s assets, or taking advantage of corporate opportunities of the
GOCC, all such profits or benefits shall be subject to restitution under Section 24 of this Act,
without prejudice to any administrative, civil or criminal action against members of the Board
of Directors/Trustees or Officers. This provision shall be applicable notwithstanding the fact
that such member of the Board or Officer risked one’s own funds in the venture.
SEC. 20. Trustee Relation to the Properties, Interests and Monies of the GOCC.—Except for
the per diem received for the actual attendance in board meetings and the reimbursement
for actual and reasonable expenses and incentives as authorized by the GCG, any and all
realized and unrealized profits and/or benefits including, but not limited to, the share in the
profits, incentives of members of the Board or Officers in excess of the authorized by the
GCG, stock options, dividends and other similar offers or grants from corporations where the
GOCC is a stockholder or investor, and any benefit from the performance of members of the
Board or Officers of the Corporation acting for and in behalf of the GOCC in dealing with its
properties, investments in other corporations, management of subsidiaries and other
interest, are to be held in trust by such member of the Board or Officer for the exclusive
benefit of the GOCC represented.
SEC. 21. Care, Diligence and Skill in the Conduct of the Business of the GOCC.—The
members of the Board and the Officers must exercise extraordinary diligence in the conduct
of the business and in dealing with the properties of the GOCC. Such a degree of diligence
requires using the utmost diligence of every cautious person with due regard for all
circumstances.
SEC. 22. Power of the Board of Directors/Trustees to Discipline, Remove Officers of the
GOCC.—Subject to existing civil service laws, rules and regulations, the Board shall have
the authority to discipline the CEO, or order the removal from office, upon a majority vote of
the members of the Board who actually took part in the investigation and deliberation.
SEC. 23. Limits to Compensation, per Diems, Allowances and Incentives.—The charters of
each of the GOCCs to the contrary notwithstanding, the compensation, per diems,
allowances and incentives of the members of the Board of Directors/Trustees of the GOCCs
shall be determined by the GCG using as a reference, among others, Executive Order No.
24 dated February 10, 2011: Provided, however, That Directors/Trustees shall not be entitled
to retirement benefits as such directors/trustees.
In case of GOCCs organized solely for the promotion of social welfare and the common
good without regard to profit, the total yearly per diems and incentives in the aggregate
which the members of the Board of such GOCCs may receive shall be determined by the
President upon the recommendation of the GCG based on the achievement by such GOCC
of its performance targets.
SEC. 24. Restitution.—Upon the determination and report of the Commission on Audit
(COA) that properties or monies belonging to the GOCC are in the possession of a member
of the Board or Officer without authority, or that profits are earned by the member of the
Board or Officer in violation of the fiduciary duty, or the aggregate per diems, allowances and
incentives received in a particular year are in excess of he limits provided under the Act, the
member of the Board or Officer, receiving such properties or monies shall return the same to
the GOCC.
Failure to make the restitution within thirty (30) days after a written demand has been served
shall, after trial and final judgment, be punished by an imprisonment of one (1) year and a
fine equivalent to twice the amount to be restituted, and in the discretion of the court of
competent jurisdiction, disqualification to hold public office.
CHAPTER V
DISCLOSURE REQUIREMENTS
Law on Public Corporations and Officers | 13
SEC. 25. Full Disclosure.—All GOCCs shall maintain a website and post therein for
unrestricted public access:
(a) Their latest annual audited financial and performance report within thirty (30) days from
receipt of such report;
(b) Audited financial statements in the immediate past five (5) years;
(c) Quarterly, annual reports and trial balance;
(d) Current corporate operating budget;
(e) Complete compensation package of all the board members and officers, including travel,
representation, transportation and any other form of expenses or allowances;
(f) Local and foreign borrowings;
(g) Performance scorecards and strategy maps;
(h) Government subsidies and net lending;
(i) All borrowings guaranteed by the government; and
(j) Such other information or report the GCG may require.
SEC. 26. Special Audit.—
(a) The thirty (30) GOCCs with the highest total assets shall be subject to periodic special
audit by the COA. The periodic audit shall, at the minimum make a determination whether:
(1) The accounting records of the GOCCS are complete and in accordance with generally
accepted accounting practices and standards; and
(2) The statements prepared from the accounts present fairly and comprehensively their
GOCCs financial position and the results of its financial operations.
(b) As may be necessary or convenient in the performance by the GCG of its functions, the
Chairman of the GCG may direct at any time a special COA audit of any other GOCC for any
specific purpose or when authorized by law, direct an audit by independent auditors.
CHAPTER VI
CREATION AND ACQUISITION OF A GOCC OR RELATED CORPORATION
SEC. 27. Requisites for the Creation of a New GOCC or Related Corporation under The
Corporation Code.—A government agency seeking to establish a GOCC or Related
Corporation under “The Corporation Code of the Philippines” shall submit its proposal to the
GCG for review and recommendation to the President for approval before registering the
same with the Securities and Exchange Commission (SEC). The SEC shall not register the
articles of incorporation and bylaws of a proposed GOCC or Related Corporation, unless the
application for registration is accompanied by an endorsement from the GCG stating that the
President has approved the same.
SEC. 28. Requisites for the Acquisition of Controlling Interest in Another Corporation.—Any
government agency seeking to purchase a corporation or acquire controlling interest therein
shall submit its proposal to the GCG for review and approval of the President.
CHAPTER VII
MISCELLANEOUS PROVISIONS
SEC. 29. Appropriations.—The amount of Ten million pesos (P10,000,000.00) for the initial
operation of the GCG shall be source from the Contingent Fund of the President.
Subsequent funding requirements shall be included in the annual General Appropriations
Act.
SEC. 30. Suppletory Application of The Corporation Code and Charters of the GOCCs.—
The provisions of “The Corporation Code of the Philippines” and the provisions of the
charters of the relevant GOCC, insofar as they are not inconsistent with the provisions of this
Act, shall apply suppletorily to GOCCS.
SEC. 31. Transitory Provision.—The Privatization Council and Privatization and
Management Office created under Executive Order No. 323, Series of 2000, shall continue
to implement and finish the privatization of GOCCs that have been identified by the said
Privatization Countil and approved for privatization by the President prior to the effectivity of
this Act: Provided, however, That the privatization of said GOCCs hat remain unfinished at
the end of every two (2) years after the effectivity of this Act shall be automatically
transferred to the GCG which shall continue the privatization of the GOCCs.
SEC. 32. Repealing Clause.—The charters of the GOCCs under existing laws and all other
laws, executive orders including Executive Order No. 323, Series of 2000, administrative
orders, rules, regulations, decrees and other issuances or parts thereof which are
inconsistent with the provisions of this Act are hereby revoked, repealed or modified
accordingly.
Cases:
Eugenio vs. CSC 3/31/95
Rubenicia vs. CSC 5/31/95
Fernando vs. Sto. Tomas 234 S 548
Classification of Civil Service
PD 807. Art. IV. (same with EO 292 Chapter 2)
Section 4. Position Embraced in the Civil Service. The Civil Service embraces every branch,
agency, subdivision, and instrumentality of the government, including every government-
owned or controlled corporations whether performing governmental or proprietary function.
Positions in the Civil Service shall be classified into career service and non-career service.
Section 5. The Career Service shall be characterized by (1) entrance based on merit and
fitness to be determined as far as practicable by competitive examinations, or based on
highly technical qualifications; (2) opportunity for advancement to higher career positions;
and (3) security of tenure.
The Career Service shall include:
1. Open Career positions for appointment to which prior qualification in an appropriate
examination is required;
2. Closed Career positions which are scientific or highly technical in nature; these include the
faculty and academic staff of state colleges and universities, and scientific and technical
positions in scientific or research institutions which shall establish and maintain their own
merit systems;
3. Positions in the Career Executive Service; namely, Undersecretary, Assistant Secretary,
Bureau Director, Assistant Bureau Director, Regional Director, Assistant Regional Director,
Chief of Department Service and other officers of equivalent rank as may be identified by the
Career Executive Service Board, all of whom are appointed by the President;
4. Career officers, other than those in the Career Executive Service, who are appointed by
the President, such as the Foreign Service Officers in the Department of Foreign Affairs;
5. Commissioned officers and enlisted men of the Armed Forces which shall maintain a
separate merit system;
6. Personnel of government-owned or controlled corporations, whether performing
governmental or proprietary functions, who do not fall under the non-career service; and
7. Permanent laborers, whether skilled, semi-skilled, or unskilled.
Section 6. The Non-Career Service shall be characterized by (1) entrance on bases other
than those of the usual tests of merit and fitness utilized for the career service; and (2)
tenure which is limited to a period specified by law, or which is coterminous with that of the
appointing authority or subject to his pleasure, or which is limited to the duration of a
particular project for which purpose employment was made.
The Non-Career Service shall include:
1. Elective officials and their personal or confidential staff;
2. Department Heads and other officials of Cabinet rank who hold positions at the pleasure
of the President and their personal or confidential staff(s);
3. Chairman and members of commissions and boards with fixed terms of office and their
personal or confidential staff;
4. Contractual personnel or those whose employment in the government is in accordance
with a special contract to undertake a specific work or job, requiring special or technical skills
not available in the employing agency, to be accomplished within a specific period, which in
no case shall exceed one year, and performs or accomplishes the specific work or job, under
his own responsibility with a minimum of direction and supervision from the hiring agency;
and
5. Emergency and seasonal personnel.
Section 7. Classes of Positions in the Career Service.
(a) Classes of positions in the career service appointment to which requires examinations
shall be grouped into three major level as follows:
1. The first level shall include clerical, trades, crafts, and custodial service positions which
involve non-professional or subprofessional work in a non-supervisory or supervisory
capacity requiring less than four years of collegiate studies;
2. The second level shall include professional, technical, and scientific positions which
involve professional, technical, or scientific work in a non-supervisory or supervisory capacity
requiring at least four years of college work up to Division Chief level; and
3. The third level shall cover positions in the Career Executive Service.
Law on Public Corporations and Officers | 14
(b) Except as herein otherwise provided, entrance to the first two levels shall be through
competitive examinations, which shall be open to those inside and outside the service who
meet the minimum qualification requirements. Entrance to a higher level does not require
previous qualification in the lower level. Entrance to the third level shall be prescribed by the
Career Executive Service Board.
(c) Within the same level, no civil service examination shall be required for promotion to a
higher position in one or more related occupational groups. A candidate for promotion
should, however, have previously passed the examination for that level.
1987 Consti. Art. IX-B. Section 2.
X X X
2. Appointments in the civil service shall be made only according to merit and fitness to be
determined, as far as practicable, and, except to positions which are policy-determining,
primarily confidential, or highly technical, by competitive examination.
Positions in the CES (3rd level) under Sec. 8, Bk. V, EO 292
Ombudsman vs. CSC 451S 570
Inok vs. CSC 7/2/02
Modesto Agyao Jr. CSC 1/18/11
Cases on Career Service
Illegal dismissal of a career officer (Palmera vs. CSC 235 S 87)
Astraquillo vs. Manglapus & Melchor vs. Saez 190 S 281
Proximity rule (PAGCOR vs. Salas 274 S 414)
barangay, municipality, city, or province or, in the case of a member of the sangguniang
panlalawigan, sangguniang panlungsod, or sangguniang bayan, the district where he intends Cases:
to be elected; a resident therein for at least one (1) year immediately preceding the day of Moreno vs. COMELEC 498 S 49
the election; and able to read and write Filipino or any other local language or dialect. Dela Torre vs. COMELEC 258 S 483
Reyes vs. COMELEC 254 S 514
(b) Candidates for the position of governor, vice-governor, or member of the sangguniang Lingating vs. Sulong 391 S 629
panlalawigan, or mayor, vice-mayor or member of the sangguniang panlungsod of highly Mercado vs. Manzano 5/26/99 (modified by RA 9225)
urbanized cities must be at least twenty-one (21) years of age on election day. Teodora Sobejana-Condon vs. COMELEC 9/7/12
Caasi vs. CA 191 S 229
(c) Candidates for the position of mayor or vice-mayor of independent component cities,
component cities, or municipalities must be at least twenty-one (21) years of age on election Dual Citizenship Act (RA 9225)
day. Section 5. Civil and Political Rights and Liabilities - Those who retain or re-acquire
Philippine citizenship under this Act shall enjoy full civil and political rights and be subject to
(d) Candidates for the position of member of the sangguniang panlungsod or sangguniang all attendant liabilities and responsibilities under existing laws of the Philippines and the
bayan must be at least eighteen (18) years of age on election day. following conditions:
X X X
(e) Candidates for the position of punong barangay or member of the sangguniang barangay (2) Those seeking elective public in the Philippines shall meet the qualification for holding
must be at least eighteen (18) years of age on election day. such public office as required by the Constitution and existing laws and, at the time of the
filing of the certificate of candidacy, make a personal and sworn renunciation of any and all
(f) Candidates for the sangguniang kabataan must be at least fifteen (15) years of age but foreign citizenship before any public officer authorized to administer an oath;
not more than twenty-one (21) years of age on election day.
Designation
Cases: Distinguished from Appointment
Maquera vs. Borra 9/7/65 National Assembly Commission vs. COA 437 S 657
Labo vs. COMELEC 176 S 1 Binamira vs. Garrucho 188 S 154

Disqualifications for local elective position Appointment

Cases on Non-Career Service
Section 40. Disqualifications. - The following persons are disqualified from running for any Achacoso vs. Macaraig 195 S 237
Jocom vs. Robredo 201 S 73
elective local position:
Office of the President vs. Buenaobra 501 S 303 Palmera vs. CSC 235 S 87
Romualdez vs. CSC 197 S 168
(a) Those sentenced by final judgment for an offense involving moral turpitude or for an
Term of Office vs. Tenure of Incumbent Felix vs. Buenaseda 240 S 139
offense punishable by one (1) year or more of imprisonment, within two (2) years after
serving sentence;
Cases: Power to Appoint
Bautista vs. Salonga 172 S 164 (b) Those removed from office as a result of an administrative case; Patagoc vs. CSC & Despalo 5/14/0
Bondoc vs. Pineda 201 S 792 Umoso vs. CSC & Caronan 234 S 617
Republic vs. Imperial 96 P 770 (c) Those convicted by final judgment for violating the oath of allegiance to the Republic; Tomali vs. CSC 238 S 572
Gaminde vs. COA 12/13/00 Orbos vs. CSC & Madarang 189 S 459
Hernandez vs. Lanzuela 10/13/99 (d) Those with dual citizenship; Maniebo vs. CA 627 S 571
Funa vs. COA Chair 4/24/12
Datu Kida vs. Phil. Senate 10/18/11 (e) Fugitives from justice in criminal or non-political cases here or abroad; Nepotism Rule
EO 292. Section 59. Nepotism. -
Primarily Confidential Positions (f) Permanent residents in a foreign country or those who have acquired the right to reside
City Legal officer- Cadiente vs. Santos 142 S 280 abroad and continue to avail of the same right after the effectivity of this Code; and (1) All appointments in the national, provincial, city and municipal governments or in
Prov’l Atty- Grino vs. CSC 2/26/91 any branch or instrumentality thereof, including government-owned or controlled
Permanent Representative to UN- De Perio Santos vs. Macaraig 4/10/92 (g) The insane or feeble-minded. corporations, made in favor of a relative of the appointing or recommending authority, or of
the chief of the bureau or office, or of the persons exercising immediate supervision over
Eligibility to Public Office him, are hereby prohibited.
1987 Consti. Art. III. Section 5. No law shall be made respecting an establishment of
As used in this Section, the word "relative" and members of the family referred to are those
religion, or prohibiting the free exercise thereof. The free exercise and enjoyment of religious
profession and worship, without discrimination or preference, shall forever be allowed. No related within the third degree either or consanguinity or of affinity.
religious test shall be required for the exercise of civil or political rights.
(2) The following are exempted from the operation of the rules on nepotism: (a)
persons employed in a confidential capacity, (b) teachers, (c) physicians, and (d) members
Section 39. Qualifications. -
of the Armed Forces of the Philippines: Provided, however, That in each particular instance
full report of such appointment shall be made to the Commission.
(a) An elective local official must be a citizen of the Philippines; a registered voter in the

Law on Public Corporations and Officers | 15

The restriction mentioned in subsection (1) shall not be applicable to the case of a member General vs. LTO RD Roco 350 S 528 If such office shall have been abandoned in order to evade the discharge of the duties of
of any family who, after his or her appointment to any position in an office or bureau, De Leon vs. Montessa 371 S 413 preventing, prosecuting or punishing any of the crime falling within Title One, and Chapter
contracts marriage with someone in the same office or bureau, in which event the Collantes vs. CA 517 S One of Title Three of Book Two of this Code, the offender shall be punished by prision
employment or retention therein of both husband and wife may be allowed. correccional in its minimum and medium periods, and by arresto mayor if the purpose of
Positions Excluded from CES (CESB Res. 799, May 2009) such abandonment is to evade the duty of preventing, prosecuting or punishing any other
(3) In order to give immediate effect to these provisions, cases of previous crime.
appointments which are in contravention hereof shall be corrected by transfer, and pending Presidential Appoinments
such transfer, no promotion or salary increase shall be allowed in favor of the relative or 1987 Consti. Art. VII. Section 16. The President shall nominate and, with the consent of the Cases:
relatives who are appointed in violation of these provisions. Commission on Appointments, appoint the heads of the executive departments, Ortiz vs. COMELEC 6/28/88
ambassadors, other public ministers and consuls, or officers of the armed forces from the SB of San Andres vs. CA
EO 292. Section 67. Penal Provision. - Whoever makes any appointment or employs rank of colonel or naval captain, and other officers whose appointments are vested in him in Collantes vs. DND 517 S 561
any person in violation of any provision of this Title or the rules made thereunder or whoever this Constitution. He shall also appoint all other officers of the Government whose Gonzales vs. Escalona 566 S 4
commits fraud, deceit or intentional misrepresentation of material facts concerning other civil appointments are not otherwise provided for by law, and those whom he may be authorized Ombudsman vs. Andutan, Jr. 7/27/11
service matters, or whoever violates, refuses or neglects to comply with any of such by law to appoint. The Congress may, by law, vest the appointment of other officers lower in Pagano vs. Nazarro 533 S 622
provisions or rules, shall upon conviction be punished by a fine not exceeding one thousand rank in the President alone, in the courts, or in the heads of departments, agencies, Estrada vs. Desierto 3/2/01
pesos or by imprisonment not exceeding six (6) months, or both such fine and imprisonment commissions, or boards.
in the discretion of the court. Removal
The President shall have the power to make appointments during the recess of the Adiong vs. CA 371 S 374
Section 79. Limitation to Appointments. - No person shall be appointed in the career Congress, whether voluntary or compulsory, but such appointments shall be effective only
Batangas Univ. vs. Bonifacio 478 S 152
service of the local government if he is related within the fourth civil degree of consanguinity until disapproved by the Commission on Appointments or until the next adjournment of the Aguinaldo vs. COMELEC 212 S 768
or affinity to the appointing or recommending authority. Congress.
Pp. vs. Jalosjos 324 S 692
Trillanes vs. Judge Pimentel 6/27/08
Cases: 1987 Consti. Art. XVIII. Section 7. Until a law is passed, the President may fill by Pp. vs. Hon. Maceda 380 P 1
Debulgado vs. CSC 237 S 184 appointment from a list of nominees by the respective sectors, the seats reserved for Bondoc vs. Pineda 201 S 792
sectoral representation in paragraph (2), Section 5 of Article V1 of this Constitution. CSC vs. Belagan 440 S 578
Exceptions to Rule: Romagos vs. Metro Cebu Water 533 S 50
Laurel V vs. CSC 203 S 195 Cases: Mayor Dagadag vs. Tongnawa 450 S 446
Debulgado vs. CSC 237 S 186 Bautista vs. Salonga 172 S 160 Ombudsman vs. Rodriguez 625 S 299
Camarines Prov. Vs. CA 246 S 283 Quintos Deles vs. Commission on Appoinments 177 S 259
Gloria vs. Rosario Cerillo 249 S 133 Sarmiento vs. Mison 156 S 549 Impeachment
Abella vs. CSC 442 S 507 Tarrosa vs. Singson 232 S 555 1987 Consti. Art. XI. Section 2. The President, the Vice-President, the Members of the
Quirog vs. Aumentado 507 S 582 Calderon vs. Carale 208 S 254 Supreme Court, the Members of the Constitutional Commissions, and the Ombudsman may
De Rama vs. CA 353 S 94 Manalo vs. Sistoza 312 S 239 be removed from office on impeachment for, and conviction of, culpable violation of the
De Castro vs. JBC 3/17/10 Constitution, treason, bribery, graft and corruption, other high crimes, or betrayal of public
1987 Consti. Art. VII. Section 15. Two months immediately before the next presidential Rufino vs. Endriga 496 S 16 trust. All other public officers and employees may be removed from office as provided by
elections and up to the end of his term, a President or Acting President shall not make law, but not by impeachment.
appointments, except temporary appointments to executive positions when continued Modes of Terminating Official Relations
vacancies therein will prejudice public service or endanger public safety. Dario vs. Mison 176 S Cases:
Gingson vs. Murcia 2/08/88 Cuenco vs.Fernan 2/17/88
Cases: Guerrero vs. Arizabal 186 S 109 Re: Justice Ruben Reyes 580 S 106
Nazareno vs. Dumaguete City 10/2/09 Mayor vs. Macaraeg 194 S 672 OMB vs. Mojica 452 S 714
Canonizado vs. Aguirre 323 S 313 Marcoleta vs. Borra 582 S 474
When appointee may be reassigned/transferred Francisco Jr. vs. House of Representatives 11/10/03
Sta. Maria vs. Lopez 31 S 637 Incompatibility of Offices Evardone vs. COMELEC 204 S 464
DECS vs. CA 183 S 555 PICI vs. Elma 494 S 54
Gloria vs. CA & Icasiano 338 S 10 Liban vs. Gordon 593 S 68 Section 73. Prohibition from Resignation. - The elective local official sought to be recalled
Fernandez vs. Sto.Tomas 242 S 193 shall not be allowed to resign while the recall process is in progress.
Padolina vs. Fernandez 343 S 442 Abandonment of Office
Plaza vs. Cassion 435 S 295 Canonizado case Section 74. Limitations on Recall. -
Vinzons-Chato vs. Martinez 344 S 18 SB of San Andres vs. CA 284 S 276
Reyes, Jr. vs. Belisario 596 S 35 (a) Any elective local official may be the subject of a recall election only once during his term
Resignation of office for loss of confidence.
Career Executive Service (CES) RPC. Article 238. Abandonment of office or position. - Any public officer who, before the
Cuevas vs. Bacal 347 S 339 acceptance of his resignation, shall abandon his office to the detriment of the public service (b) No recall shall take place within one (1) year from the date of the official's assumption to
Caringal vs. PCSO 472 S 577 shall suffer the penalty of arresto mayor. office or one (1) year immediately preceding a regular local election.
Amores vs. CSC 4/29/09
Law on Public Corporations and Officers | 16
1987 Consti. Art. X Section 8. The term of office of elective local officials, except barangay
officials, which shall be determined by law, shall be three years and no such official shall
serve for more than three consecutive terms. Voluntary renunciation of the office for any
length of time shall not be considered as an interruption in the continuity of his service for the
full term for which he was elected.
Kida vs. Senate 2/28/12
Preventive Suspension
Gloria vs. CA306 S 287
Sales vs. Mathay 129 S 180
CSC vs. Rabang 3/14/08
Grounds:
EO 292. Section 51. Preventive Suspension. - The proper disciplining authority may
preventively suspend any subordinate officer or employee under his authority pending an
investigation, if the charge against such officer or employee involves dishonesty, oppression
or grave misconduct, or neglect in the performance of duty, or if there are reasons to believe
that the respondent is guilty of charges which would warrant his removal from the service.
Section 63. Preventive Suspension. -
(a) Preventive suspension may be imposed:
(1) By the President, if the respondent is an elective official of a province, a highly urbanized
or an independent component city;
(2) By the governor, if the respondent is an elective official of a component city or
municipality; or
(3) By the mayor, if the respondent is an elective official of the barangay.
(b) Preventive suspension may be imposed at any time after the issues are joined, when the
evidence of guilt is strong, and given the gravity of the offense, there is great probability that
the continuance in office of the respondent could influence the witnesses or pose a threat to
the safety and integrity of the records and other evidence: Provided, That, any single
preventive suspension of local elective officials shall not extend beyond sixty (60) days:
Provided, further, That in the event that several administrative cases are filed against an
elective official, he cannot be preventively suspended for more than ninety (90) days within a
single year on the same ground or grounds existing and known at the time of the first
suspension.
(c) Upon expiration of the preventive suspension, the suspended elective official shall be
deemed reinstated in office without prejudice to the continuation of the proceedings against
him, which shall be terminated within one hundred twenty (120) days from the time he was
formally notified of the case against him. However, if the delay in the proceedings of the case
is due to his fault, neglect, or request, other than the appeal duly filed, the duration of such
delay shall not be counted in computing the time of termination of the case.
(d) Any abuse of the exercise of the power of preventive suspension shall be penalized as
abuse of authority.
Section 64. Salary of Respondent Pending Suspension. - The respondent official
preventively suspended from office shall receive no salary or compensation during such
suspension; but upon subsequent exoneration and reinstatement, he shall be paid full salary
or compensation including such emoluments accruing during such suspension.
1987 Consti.
RA 6770. Section 24. Preventives Suspension. — The Ombudsman or his Deputy may
preventively suspend any officer or employee under his authority pending an investigation, if Art. III. Section 8. The right of the people, including those employed in the public and private
in his judgment the evidence of guilt is strong, and (a) the charge against such officer or sectors, to form unions, associations, or societies for purposes not contrary to law shall not
employee involves dishonesty, oppression or grave misconduct or neglect in the be abridged.
performance of duty; (b) the charges would warrant removal from the service; or (c) the
respondent's continued stay in office may prejudice the case filed against him. Art. IX-B. Section 2.
X X X
The preventive suspension shall continue until the case is terminated by the Office of the 5. The right to self-organization shall not be denied to government employees.
Ombudsman but not more than six (6) months, without pay, except when the delay in the
disposition of the case by the Office of the Ombudsman is due to the fault, negligence or Art. XIII. Section 3. The State shall afford full protection to labor, local and overseas,
petition of the respondent, in which case the period of such delay shall not be counted in organized and unorganized, and promote full employment and equality of employment
computing the period of suspension herein provided. opportunities for all.
RA 3019. Section 13. Suspension and loss of benefits. Any public officer against whom It shall guarantee the rights of all workers to self-organization, collective bargaining and
any criminal prosecution under a valid information under this Act or under the provisions of negotiations, and peaceful concerted activities, including the right to strike in accordance
the Revised Penal Code on bribery is pending in court, shall be suspended from office. with law. They shall be entitled to security of tenure, humane conditions of work, and a living
Should he be convicted by final judgment, he shall lose all retirement or gratuity benefits wage. They shall also participate in policy and decision-making processes affecting their
under any law, but if he is acquitted, he shall be entitled to reinstatement and to the salaries rights and benefits as may be provided by law.
and benefits which he failed to receive during suspension, unless in the meantime
administrative proceedings have been filed against him. The State shall promote the principle of shared responsibility between workers and
employers and the preferential use of voluntary modes in settling disputes, including
Cases: conciliation, and shall enforce their mutual compliance therewith to foster industrial peace.
Bayot vs. Sandiganbayan 128 S 383
Deloso vs. Sandiganbayan 173 S 409 The State shall regulate the relations between workers and employers, recognizing the right
of labor to its just share in the fruits of production and the right of enterprises to reasonable
Libanan vs. Sandiganbayan 233 S 163
returns to investments, and to expansion and growth.
Berona vs. Sandiganbayan 435 S 306
Juan vs. Pp 322 S 126
Arizala vs. CA 9/14/90
Santiago vs. Sandiganbayan 356 S 637
SSS vs. CA 175 S 686
Flores vs. Layosa 436 S 339
Manila PSTA vs. Educ. Sec. 200 S 323
Gesite vs. CA 444 S 52
Rights, Duties and Privileges
Bangalisan vs. CA 276 S 619
Jacinto vs. CA 281 S 657
1987 Consti. Art IX-B. Section 8. No elective or appointive public officer or employee shall
receive additional, double, or indirect compensation, unless specifically authorized by law, Alipat vs. CA 308 S 781
Dela Cruz vs. CA 305 S 303
nor accept without the consent of the Congress, any present, emolument, office, or title of
any kind from any foreign government. MIAA vs. COA 2/14/12
Pensions or gratuities shall not be considered as additional, double, or indirect 1987 Consti. Art. XI. Section 17. A public officer or employee shall, upon assumption of
compensation. office and as often thereafter as may be required by law, submit a declaration under oath of
his assets, liabilities, and net worth. In the case of the President, the Vice-President, the
Valdez vs. GSIS 6/30/08 Members of the Cabinet, the Congress, the Supreme Court, the Constitutional Commissions
Cruz vs. Tantuico 166 S 671 and other constitutional offices, and officers of the armed forces with general or flag rank, the
Tantuico vs. Domingo 230 S 391 declaration shall be disclosed to the public in the manner provided by law.
GSIS vs. COA 441 S 534
Conte vs. COA 264 S Unexplained Wealth of Public Officers
Santiago vs. COA 537 S 1987 Consti. Art. XI. Section 1. Public office is a public trust. Public officers and employees
BWD vs. COA 374 S 482 must, at all times, be accountable to the people, serve them with utmost responsibility,
Querubin vs. COA 433 S 773 integrity, loyalty, and efficiency; act with patriotism and justice, and lead modest lives.
De Jesus vs. CSC 471 S 626
Barbo vs. COA 568 S RA 3019. Section 8. Dismissal due to unexplained wealth. If in accordance with the
Dela Cruz vs. COA 371 S 158 provisions of Republic Act Numbered One thousand three hundred seventy-nine, a public
DBM vs. Manila’s Finest Retirees Association 5/9/07 official has been found to have acquired during his incumbency, whether in his name or in
Dir. Bitonio vs. COA 425 S 437 the name of other persons, an amount of property and/or money manifestly out of proportion
to his salary and to his other lawful income, that fact shall be a ground for dismissal or
Constitutional Right to Self-Organization removal. Properties in the name of the spouse and unmarried children of such public official
may be taken into consideration, when their acquisition through legitimate means cannot be
Law on Public Corporations and Officers | 17
satisfactorily shown. Bank deposits shall be taken into consideration in the enforcement of
this section, notwithstanding any provision of law to the contrary.
RA 1379. Section 1. Definitions.
(a) For the purposes of this Act, a "public officer or employee" means any person
holding any public office or employment by virtue of an appointment, election or contract,
and any person holding any office or employment, by appointment or contract, in any State
owned or controlled corporation or enterprise.
(b) "Other legitimately acquired property" means any real or personal property,
money or securities which the respondent has at any time acquired by inheritance and the
income thereof, or by gift inter vivos before his becoming a public officer or employee, or any
property (or income thereof) already pertaining to him when he qualified for public office or
employment, or the fruits and income of the exclusive property of the respondent's spouse. It
shall not include:
1. Property unlawfully acquired by the respondent, but its ownership is concealed
by its being recorded in the name of, or held by, the respondent's spouse, ascendants,
descendants, relatives, or any other person.
2. Property unlawfully acquired by the respondent, but transferred by him to
another person or persons on or after the effectivity of this Act.
3. Property donated to the respondent during his incumbency, unless he can prove
to the satisfaction of the court that the donation is lawful.
Section 2. Filing of petition. Whenever any public officer or employee has acquired during
his incumbency an amount of property which is manifestly out of proportion to his salary as
such public officer or employee and to his other lawful income and the income from
legitimately acquired property, said property shall be presumed prima facie to have been
unlawfully acquired. The Solicitor General, upon complaint by any taxpayer to the city or
provincial fiscal who shall conduct a previous inquiry similar to preliminary investigations in
criminal cases and shall certify to the Solicitor General that there is reasonable ground to
believe that there has been committed a violation of this Act and the respondent is probably
guilty thereof, shall file, in the name and on behalf of the Republic of the Philippines, in the
Court of First Instance of the city or province where said public officer or employee resides or
holds office, a petition for a writ commanding said officer or employee to show cause why the
property aforesaid, or any part thereof, should not be declared property of the State:
Provided, That no such petition shall be filed within one year before any general election or
within three months before any special election.
The resignation, dismissal or separation of the officer or employee from his office or
employment in the Government or in the Government-owned or controlled corporation shall
not be a bar to the filing of the petition: Provided, however, That the right to file such petition
shall prescribe after four years from the date of the resignation, dismissal or separation or
expiration of the term of the office or employee concerned, except as to those who have
ceased to hold office within ten years prior to the approval of this Act, in which case the
proceedings shall prescribe after four years from the approval hereof.
PNB vs. Gancayco 15 S 91
Banco Filipino vs. Purisima 161 S 576
Marquez vs. Desierto vs. 359 S 773
Exceptions:
UBP vs. CA 321 S 563
RA 6426. Section 8. Secrecy of foreign currency deposits. – All foreign currency deposits
authorized under this Act, as amended by PD No. 1035, as well as foreign currency deposits
authorized under PD No. 1034, are hereby declared as and considered of an absolutely
confidential nature and, except upon the written permission of the depositor, in no instance
shall foreign currency deposits be examined, inquired or looked into by any person,
government official, bureau or office whether judicial or administrative or legislative, or any
other entity whether public or private; Provided, however, That said foreign currency deposits
shall be exempt from attachment, garnishment, or any other order or process of any court,
legislative body, government agency or any administrative body whatsoever. (As amended
by PD No. 1035, and further amended by PD No. 1246, prom. Nov. 21, 1977.)
Liability for Impeachable Officer
In re: Raul Gonzales 160 S 771
Liability of Head of Office
PD 1445. Section 102. Primary and secondary responsibility.
1. The head of any agency of the government is immediately and primarily responsible for all
government funds and property pertaining to his agency.
2. Persons entrusted with the possession or custody of the funds or property under the
agency head shall be immediately responsible to him, without prejudice to the liability of
either party to the government.
Section 103. General liability for unlawful expenditures. Expenditures of government
funds or uses of government property in violation of law or regulations shall be a personal
liability of the official or employee found to be directly responsible therefor.
Albert vs. Gangan 353 S 673
Arias vs. Sandiganbayan 180 S 310
RED Principe vs. OMB 374 S 460
De Jesus vs. Guerrero 598 S 342
Montallana vs. CA 8/8/12
Banas vs. CA 325 S 263
Anti-Graft and Corrupt Practices Act (RA 3019)
Section 3. Corrupt practices of public officers. In addition to acts or omissions of public
officers already penalized by existing law, the following shall constitute corrupt practices of
any public officer and are hereby declared to be unlawful:
(a) Persuading, inducing or influencing another public officer to perform an act constituting a
violation of rules and regulations duly promulgated by competent authority or an offense in
connection with the official duties of the latter, or allowing himself to be persuaded, induced,
or influenced to commit such violation or offense.
(b) Directly or indirectly requesting or receiving any gift, present, share, percentage, or
benefit, for himself or for any other person, in connection with any contract or transaction
between the Government and any other part, wherein the public officer in his official capacity
has to intervene under the law.
(c) Directly or indirectly requesting or receiving any gift, present or other pecuniary or
material benefit, for himself or for another, from any person for whom the public officer, in
any manner or capacity, has secured or obtained, or will secure or obtain, any Government
permit or license, in consideration for the help given or to be given, without prejudice to
Section thirteen of this Act.
(d) Accepting or having any member of his family accept employment in a private enterprise
which has pending official business with him during the pendency thereof or within one year
after its termination.
(e) Causing any undue injury to any party, including the Government, or giving any private
party any unwarranted benefits, advantage or preference in the discharge of his official
administrative or judicial functions through manifest partiality, evident bad faith or gross
inexcusable negligence. This provision shall apply to officers and employees of offices or
government corporations charged with the grant of licenses or permits or other concessions.
(f) Neglecting or refusing, after due demand or request, without sufficient justification, to act
within a reasonable time on any matter pending before him for the purpose of obtaining,
directly or indirectly, from any person interested in the matter some pecuniary or material
benefit or advantage, or for the purpose of favoring his own interest or giving undue
advantage in favor of or discriminating against any other interested party.
(g) Entering, on behalf of the Government, into any contract or transaction manifestly and
grossly disadvantageous to the same, whether or not the public officer profited or will profit
thereby.
(h) Director or indirectly having financing or pecuniary interest in any business, contract or
transaction in connection with which he intervenes or takes part in his official capacity, or in
which he is prohibited by the Constitution or by any law from having any interest.
(i) Directly or indirectly becoming interested, for personal gain, or having a material interest
in any transaction or act requiring the approval of a board, panel or group of which he is a
member, and which exercises discretion in such approval, even if he votes against the same
or does not participate in the action of the board, committee, panel or group.
Interest for personal gain shall be presumed against those public officers responsible for the
approval of manifestly unlawful, inequitable, or irregular transaction or acts by the board,
panel or group to which they belong.
(j) Knowingly approving or granting any license, permit, privilege or benefit in favor of any
person not qualified for or not legally entitled to such license, permit, privilege or advantage,
or of a mere representative or dummy of one who is not so qualified or entitled.
(k) Divulging valuable information of a confidential character, acquired by his office or by him
on account of his official position to unauthorized persons, or releasing such information in
advance of its authorized release date.
The person giving the gift, present, share, percentage or benefit referred to in subparagraphs
(b) and (c); or offering or giving to the public officer the employment mentioned in
subparagraph (d); or urging the divulging or untimely release of the confidential information
referred to in subparagraph (k) of this section shall, together with the offending public officer,
be punished under Section nine of this Act and shall be permanently or temporarily
disqualified in the discretion of the Court, from transacting business in any form with the
Government.
Section 4. Prohibition on private individuals. (a) It shall be unlawful for any person having
family or close personal relation with any public official to capitalize or exploit or take
advantage of such family or close personal relation by directly or indirectly requesting or
receiving any present, gift or material or pecuniary advantage from any other person having
some business, transaction, application, request or contract with the government, in which
such public official has to intervene. Family relation shall include the spouse or relatives by
consanguinity or affinity in the third civil degree. The word "close personal relation" shall
include close personal friendship, social and fraternal connections, and professional
employment all giving rise to intimacy which assures free access to such public officer.
(b) It shall be unlawful for any person knowingly to induce or cause any public official to
Law on Public Corporations and Officers | 18
commit any of the offenses defined in Section 3 hereof.
Section 5. Prohibition on certain relatives. It shall be unlawful for the spouse or for any
relative, by consanguinity or affinity, within the third civil degree, of the President of the
Philippines, the Vice-President of the Philippines, the President of the Senate, or the
Speaker of the House of Representatives, to intervene, directly or indirectly, in any business,
transaction, contract or application with the Government: Provided, That this section shall not
apply to any person who, prior to the assumption of office of any of the above officials to
whom he is related, has been already dealing with the Government along the same line of
business, nor to any transaction, contract or application already existing or pending at the
time of such assumption of public office, nor to any application filed by him the approval of
which is not discretionary on the part of the official or officials concerned but depends upon
compliance with requisites provided by law, or rules or regulations issued pursuant to law,
nor to any act lawfully performed in an official capacity or in the exercise of a profession.
Section 6. Prohibition on Members of Congress. It shall be unlawful hereafter for any
Member of the Congress during the term for which he has been elected, to acquire or
receive any personal pecuniary interest in any specific business enterprise which will be
directly and particularly favored or benefited by any law or resolution authored by him
previously approved or adopted by the Congress during the same term.
The provision of this section shall apply to any other public officer who recommended the
initiation in Congress of the enactment or adoption of any law or resolution, and acquires or
receives any such interest during his incumbency.
It shall likewise be unlawful for such member of Congress or other public officer, who, having
such interest prior to the approval of such law or resolution authored or recommended by
him, continues for thirty days after such approval to retain such interest.
Section 7. Statement of assets and liabilities. Every public officer, within thirty days after
the approval of this Act or after assuming office, and within the month of January of every
other year thereafter, as well as upon the expiration of his term of office, or upon his
resignation or separation from office, shall prepare and file with the office of the
corresponding Department Head, or in the case of a Head of Department or chief of an
independent office, with the Office of the President, or in the case of members of the
Congress and the officials and employees thereof, with the Office of the Secretary of the
corresponding House, a true detailed and sworn statement of assets and liabilities, including
a statement of the amounts and sources of his income, the amounts of his personal and
family expenses and the amount of income taxes paid for the next preceding calendar year:
Provided, That public officers assuming office less than two months before the end of the
calendar year, may file their statements in the following months of January.
Section 8. Dismissal due to unexplained wealth. If in accordance with the provisions of
Republic Act Numbered One thousand three hundred seventy-nine, a public official has been
found to have acquired during his incumbency, whether in his name or in the name of other
persons, an amount of property and/or money manifestly out of proportion to his salary and
to his other lawful income, that fact shall be a ground for dismissal or removal. Properties in
the name of the spouse and unmarried children of such public official may be taken into
consideration, when their acquisition through legitimate means cannot be satisfactorily
shown. Bank deposits shall be taken into consideration in the enforcement of this section,
notwithstanding any provision of law to the contrary.
Section 11. Prescription of offenses. All offenses punishable under this Act shall prescribe
in ten years.
Section 12. Termination of office. No public officer shall be allowed to resign or retire
pending an investigation, criminal or administrative, or pending a prosecution against him, for
any offense under this Act or under the provisions of the Revised Penal Code on bribery.
Cf. with Sec. 7 RA 3019
RA 6713. Section 8. Statements and Disclosure. - Public officials and employees have an
obligation to accomplish and submit declarations under oath of, and the public has the right
to know, their assets, liabilities, net worth and financial and business interests including
those of their spouses and of unmarried children under eighteen (18) years of age living in
their households.
(A) Statements of Assets and Liabilities and Financial Disclosure. - All public officials and
employees, except those who serve in an honorary capacity, laborers and casual or
temporary workers, shall file under oath their Statement of Assets, Liabilities and Net Worth
and a Disclosure of Business Interests and Financial Connections and those of their spouses
and unmarried children under eighteen (18) years of age living in their households.
The two documents shall contain information on the following:
(a) real property, its improvements, acquisition costs, assessed value and current fair market
value;
(b) personal property and acquisition cost;
(c) all other assets such as investments, cash on hand or in banks, stocks, bonds, and the
like;
(d) liabilities, and;
(e) all business interests and financial connections.
The documents must be filed:
(a) within thirty (30) days after assumption of office;
(b) on or before April 30, of every year thereafter; and
(c) within thirty (30) days after separation from the service.
All public officials and employees required under this section to file the aforestated
documents shall also execute, within thirty (30) days from the date of their assumption of
office, the necessary authority in favor of the Ombudsman to obtain from all appropriate
government agencies, including the Bureau of Internal Revenue, such documents as may
show their assets, liabilities, net worth, and also their business interests and financial
connections in previous years, including, if possible, the year when they first assumed any
office in the Government.
Husband and wife who are both public officials or employees may file the required
statements jointly or separately.
The Statements of Assets, Liabilities and Net Worth and the Disclosure of Business Interests
and Financial Connections shall be filed by:
(1) Constitutional and national elective officials, with the national office of the Ombudsman;
(2) Senators and Congressmen, with the Secretaries of the Senate and the House of
Representatives, respectively; Justices, with the Clerk of Court of the Supreme Court;
Judges, with the Court Administrator; and all national executive officials with the Office of the
President.
(3) Regional and local officials and employees, with the Deputy Ombudsman in their
respective regions;
(4) Officers of the armed forces from the rank of colonel or naval captain, with the Office of
the President, and those below said ranks, with the Deputy Ombudsman in their respective
regions; and
(5) All other public officials and employees, defined in Republic Act No. 3019, as amended,
with the Civil Service Commission.
(B) Identification and disclosure of relatives. - It shall be the duty of every public official or
employee to identify and disclose, to the best of his knowledge and information, his relatives
in the Government in the form, manner and frequency prescribed by the Civil Service
Commission.
(C) Accessibility of documents. - (1) Any and all statements filed under this Act, shall be
made available for inspection at reasonable hours.
(2) Such statements shall be made available for copying or reproduction after ten (10)
working days from the time they are filed as required by law.
(3) Any person requesting a copy of a statement shall be required to pay a reasonable fee to
cover the cost of reproduction and mailing of such statement, as well as the cost of
certification.
(4) Any statement filed under this Act shall be available to the public for a period of ten (10)
years after receipt of the statement. After such period, the statement may be destroyed
unless needed in an ongoing investigation.
(D) Prohibited acts. - It shall be unlawful for any person to obtain or use any statement filed
under this Act for:
(a) any purpose contrary to morals or public policy; or
(b) any commercial purpose other than by news and communications media for
dissemination to the general public.
Code of Conduct & Ethical Standards for Public Officials (6713)
Section 4. Norms of Conduct of Public Officials and Employees. - (A) Every public
official and employee shall observe the following as standards of personal conduct in the
discharge and execution of official duties:
(a) Commitment to public interest. - Public officials and employees shall always uphold the
public interest over and above personal interest. All government resources and powers of
their respective offices must be employed and used efficiently, effectively, honestly and
economically, particularly to avoid wastage in public funds and revenues.
(b) Professionalism. - Public officials and employees shall perform and discharge their duties
with the highest degree of excellence, professionalism, intelligence and skill. They shall enter
public service with utmost devotion and dedication to duty. They shall endeavor to
discourage wrong perceptions of their roles as dispensers or peddlers of undue patronage.
(c) Justness and sincerity. - Public officials and employees shall remain true to the people at
all times. They must act with justness and sincerity and shall not discriminate against
anyone, especially the poor and the underprivileged. They shall at all times respect the rights
of others, and shall refrain from doing acts contrary to law, good morals, good customs,
public policy, public order, public safety and public interest. They shall not dispense or
extend undue favors on account of their office to their relatives whether by consanguinity or
affinity except with respect to appointments of such relatives to positions considered strictly
confidential or as members of their personal staff whose terms are coterminous with theirs.
(d) Political neutrality. - Public officials and employees shall provide service to everyone
Law on Public Corporations and Officers | 19
without unfair discrimination and regardless of party affiliation or preference.
(e) Responsiveness to the public. - Public officials and employees shall extend prompt,
courteous, and adequate service to the public. Unless otherwise provided by law or when
required by the public interest, public officials and employees shall provide information of
their policies and procedures in clear and understandable language, ensure openness of
information, public consultations and hearings whenever appropriate, encourage
suggestions, simplify and systematize policy, rules and procedures, avoid red tape and
develop an understanding and appreciation of the socio-economic conditions prevailing in
the country, especially in the depressed rural and urban areas.
(f) Nationalism and patriotism. - Public officials and employees shall at all times be loyal to
the Republic and to the Filipino people, promote the use of locally produced goods,
resources and technology and encourage appreciation and pride of country and people.
They shall endeavor to maintain and defend Philippine sovereignty against foreign intrusion.
(g) Commitment to democracy. - Public officials and employees shall commit themselves to
the democratic way of life and values, maintain the principle of public accountability, and
manifest by deeds the supremacy of civilian authority over the military. They shall at all times
uphold the Constitution and put loyalty to country above loyalty to persons or party.
(h) Simple living. - Public officials and employees and their families shall lead modest lives
appropriate to their positions and income. They shall not indulge in extravagant or
ostentatious display of wealth in any form.
(B) The Civil Service Commission shall adopt positive measures to promote (1) observance
of these standards including the dissemination of information programs and workshops
authorizing merit increases beyond regular progression steps, to a limited number of
employees recognized by their office colleagues to be outstanding in their observance of
ethical standards; and (2) continuing research and experimentation on measures which
provide positive motivation to public officials and employees in raising the general level of
observance of these standards.
Section 5. Duties of Public Officials and Employees. - In the performance of their duties,
all public officials and employees are under obligation to:
(a) Act promptly on letters and requests. - All public officials and employees shall, within
fifteen (15) working days from receipt thereof, respond to letters, telegrams or other means
of communications sent by the public. The reply must contain the action taken on the
request.
(b) Submit annual performance reports. - All heads or other responsible officers of offices
and agencies of the government and of government-owned or controlled corporations shall,
within forty-five (45) working days from the end of the year, render a performance report of
the agency or office or corporation concerned. Such report shall be open and available to the
public within regular office hours.
(c) Process documents and papers expeditiously. - All official papers and documents must
be processed and completed within a reasonable time from the preparation thereof and must
contain, as far as practicable, not more than three (3) signatories therein. In the absence of
duly authorized signatories, the official next-in-rank or officer in charge shall sign for and in
their behalf.
(d) Act immediately on the public's personal transactions. - All public officials and employees
must attend to anyone who wants to avail himself of the services of their offices and must, at
all times, act promptly and expeditiously.
(e) Make documents accessible to the public. - All public documents must be made
accessible to, and readily available for inspection by, the public within reasonable working
hours.
Section 6. System of Incentives and Rewards. - A system of annual incentives and
rewards is hereby established in order to motivate and inspire public servants to uphold the
highest standards of ethics. For this purpose, a Committee on Awards to Outstanding Public
Officials and Employees is hereby created composed of the following: the Ombudsman and
Chairman of the Civil Service Commission as Co-Chairmen, and the Chairman of the
Commission on Audit, and two government employees to be appointed by the President, as
members.
It shall be the task of this Committee to conduct a periodic, continuing review of the
performance of public officials and employees, in all the branches and agencies of
Government and establish a system of annual incentives and rewards to the end that due
recognition is given to public officials and employees of outstanding merit on the basis of the
standards set forth in this Act.
The conferment of awards shall take into account, among other things, the following: the
years of service and the quality and consistency of performance, the obscurity of the
position, the level of salary, the unique and exemplary quality of a certain achievement, and
the risks or temptations inherent in the work. Incentives and rewards to government officials
and employees of the year to be announced in public ceremonies honoring them may take
the form of bonuses, citations, directorships in government-owned or controlled corporations,
local and foreign scholarship grants, paid vacations and the like. They shall likewise be
automatically promoted to the next higher position with the commensurate salary suitable to
their qualifications. In case there is no next higher position or it is not vacant, said position
shall be included in the budget of the office in the next General Appropriations Act. The
Committee on Awards shall adopt its own rules to govern the conduct of its activities.
Section 9. Divestment. - A public official or employee shall avoid conflicts of interest at all
times. When a conflict of interest arises, he shall resign from his position in any private
business enterprise within thirty (30) days from his assumption of office and/or divest himself
of his shareholdings or interest within sixty (60) days from such assumption.
The same rule shall apply where the public official or employee is a partner in a partnership.
The requirement of divestment shall not apply to those who serve the Government in an
honorary capacity nor to laborers and casual or temporary workers.
Disabilities and Inhibitions of Public Officers
Forbidden Office:
1987 Consti. Art. VI. Section 13. No Senator or Member of the House of Representatives
may hold any other office or employment in the Government, or any subdivision, agency, or
instrumentality thereof, including government-owned or controlled corporations or their
subsidiaries, during his term without forfeiting his seat. Neither shall he be appointed to any
office which may have been created or the emoluments thereof increased during the term for
which he was elected.
Flores vs. Drilon 23 S 568
Public Interest Center vs. Elma 494 S 62
CLU vs. Exec. Sec. 2/22/91
Dela Cruz vs. COA 371 S 157
1987 Consti. Art. IX-B. Section 7. No elective official shall be eligible for appointment or
designation in any capacity to any public office or position during his tenure.
Unless otherwise allowed by law or by the primary functions of his position, no appointive
official shall hold any other office or employment in the Government or any subdivision,
agency or instrumentality thereof, including Government-owned or controlled corporations or
their subsidiaries.
1987 Consti. Art. VII. Section 3. There shall be a Vice-President who shall have the same
qualifications and term of office and be elected with, and in the same manner, as the
President. He may be removed from office in the same manner as the President.
The Vice-President may be appointed as a Member of the Cabinet. Such appointment
requires no confirmation.
Art. VIII. Section 8.
1. A Judicial and Bar Council is hereby created under the supervision of the
Supreme Court composed of the Chief Justice as ex officio Chairman, the Secretary of
Justice, and a representative of the Congress as ex officio Members, a representative of the
Integrated Bar, a professor of law, a retired Member of the Supreme Court, and a
representative of the private sector.
X X X
Art. XII. Section 9. The Congress may establish an independent economic and planning
agency headed by the President, which shall, after consultations with the appropriate public
agencies, various private sectors, and local government units, recommend to Congress, and
implement continuing integrated and coordinated programs and policies for national
development.
Until the Congress provides otherwise, the National Economic and Development Authority
shall function as the independent planning agency of the government.
Lorenzana vs. Fajardo 462 S 1
RA 6713. Section 7. Prohibited Acts and Transactions. - In addition to acts and
omissions of public officials and employees now prescribed in the Constitution and existing
laws, the following shall constitute prohibited acts and transactions of any public official and
employee and are hereby declared to be unlawful:
X X X
(b) Outside employment and other activities related thereto. - Public officials and employees
during their incumbency shall not:
X X X
(2) Engage in the private practice of their profession unless authorized by the Constitution or
law, provided, that such practice will not conflict or tend to conflict with their official functions;
or
X X X
Ramos vs. Imbang 530 S 759
Query of Atty. Buffe 596 S 379
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