ADMINISTRATIVE LAW – 1ST EXAM

First Component: Public Organizations

Xandredg Sumpt L. Latog Each of these organizations have their respective goals,
policies, structures, resources and processes. These organizations
I are usually created by law, which defines for their purpose, their
GENERAL PRINCIPLES core structure, the functions that they are to undertake and how
their operations are to be funded by public funds.
A. DEFINITION Traditionally, the Philippine administrative system refers
to the executive branch, all offices and instrumentalities thereof,
1. Administrative Law local government units, government owned and controlled
Administrative Law belongs to the field of public law corporations, and chartered institutions such as state colleges and
which includes constitutional law, criminal law, and international universities [Alfiler].
law. There is no agreement as to scope or bounds of the term.
According to De Leon, Administrative Law has been Second Component: Internal Processes and Interactive
defined in its widest sense as the entire system of laws under which Efforts
the machinery of the State works and by which the State performs This simply means that each of these organizations
all government acts. As generally understood today, it means that perform their public functions through defined rules and
part of law which governs the organization, functions, and procedures. These procedures are internal to the organization.
procedures of administrative agencies of the government to which Aside from these internal operating procedures, these
(quasi) legislative powers are delegated and (quasi) judicial powers organizations have policies, rules, and procedures that govern their
are granted, and the extent and manner to which such agencies are working relationships with other government offices [Alfiler].
subject to control by the courts.
In a general sense, administrative law embraces all the Third Component; Implementing, Helping,
law that controls, or is intended to control, the administrative Formulating, and Assessing Public Policies
operations of government. The Philippine Administrative System is primarily
According to Nachura, Administrative Law is the branch responsible for implementing public policies formulated jointly by
of public law which: the legislative and executive branches. Aside from implementing
a. Fixes the organization, and helping formulate policies, the Philippine administrative
b. Determines the competence of administrative system also monitors or assess public policies. As a matter of
authorities, and procedure, every government office is required to submit an annual
c. Indicates to the individual remedies for the violating report on its activities.
of his rights.
Fourth Component: Individuals, Groups,
2. Public Administration Organizations, and Communities as its Public/Clientele
Public administration has to do with the practical The PAS must be conscious of the different kinds of
management and direction of the various organs of the State and publics or clientele that it deals with. Depending on its character, a
the execution of state policies by the executive and administrative public organization may be dealing with individuals, groups,
officers entrusted with such functions [De Leon]. private or other public organizations, communities or even other
While public administration is the law in action, the law countries as its “public-in-contact.” [Alfiler]
of how, when, and where these actions can be taken is called
administrative law [Shafritz]. Fifth Component: The Greater Socio-Politico and
The true field of administrative law refers only to the Economic Environment
external aspect of public administration (i.e., legal relations The PAS is part of a bigger social system where there are
between administrative authorities and private interests.) [De Leon] competing claims to limited resources and institutions play a role in
determining how these resources will be utilized [Alfiler].
3. Public Policy
Public policy refers to the process whereby the members B. KINDS OF ADMINISTRATIVE LAWS
of a geographic area or political unit make choices that address a) Statutes setting up administrative authorities.
their areas and issues of concern. “Public” reflects the preferences b) Rules, regulations or orders of such administrative
and actions of a group of people, most commonly through their authorities promulgated pursuant to the purposes for which they
joint voice as reflected in their governing institutions and were created.
especially their governments. c) Determinations, decisions and orders of such
“Policy” refers to rules, management strategies, administrative authorities made in the settlement of controversies
processes, and plans allowed by the public to address their areas of arising in their particular fields.
concern. d) Body of doctrines and decisions dealing with the
Public policy differs from public administration in that it creation, operation and effect of determinations and regulations of
focuses on the “public” problems requiring action, while public such administrative authorities.
administration focuses on the process through which they are
solved. II
ADMINISTRATIVE AGENCIES
4. Philippine Administrative System
This refers to a network of public organizations with A. DEFINITION
specific goals, policies, structures, resources and programs. It
includes the internal processes of, and the interaction between and 1. Administrative Agency
among, public organizations which are constituted to implement, Administrative agency is a term used generally to
help formulate, monitor, or assess public policies. describe an agency exercising some significant combination of
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executive, legislative, and judicial powers. It is a government body countless controversies which cannot possibly be
charged with administering and implementing particular legislation handled by regular courts [Monetary Board v. PVB].
[De Leon]. c. To help in the regulation of ramified activities of a
An administrative agency may be defined as a body developing country.
endowed with quasi-legislative and quasi-judicial powers for the d. To entrust to specialized agencies in specified with their
purpose of enabling it to carry out laws entrusted to it for special knowledge, experience, and capability the task
enforcement or execution [Cruz]. It is an organ or government, of dealing with problems thereof as they have the
other than a court and other than a legislature, which affects the experience, expertise, and power of dispatch to provide
rights of private parties either through adjudication or rule-making solutions thereto [Agpalo].
[Nachura].
It covers boards, commissions, divisions, bureaus, and Common Types
departments, and somewhat less familiar designations of “office” a. Bodies set up to function in situations where the government
and “authority.” is offering some gratuity, grant or special privilege, e.g., like
the defunct Philippine Veterans Board, Board on Pensions
Main characteristics of administrative agencies for Veterans, and NARRA, and Philippine Veterans
a. Size – many administrative agencies are necessarily large Administration; GSIS; SSS.
b. Specialization b. Bodies set up to function in situations wherein the
c. Responsibility for results – a particular administrative agency government is seeking to carry on certain governmental
is charged by Congress with accomplishing a particular functions, e.g., Bureau of Immigration; BIR; LRA.
statutory end c. Bodies set up to function in situations wherein the
d. Variety of administrative duties – means variety in the government is performing some business service for the
circumstances and conditions under which the activities of the public,, e.g., MWSS; PhilPost; PNR; NEA; NFA; NHA.
various agencies impinge upon private individuals [De Leon]. d. Bodies set up to function in situations wherein the
e. Territory government is seeking to regulate business affected with
f. Administrative duties public interest, e.g., LTFTB; IC; NTC.
g. Delegated authorities e. Bodies set up to function in situations wherein the
h. Accountability government is seeking under the police power to regulate
i. Relationships private business and indivudals, e.g., SEC; PRC; MTRCB.
j. Capitalization/funding (stocks, if any) [Agra]. f. Bodies set up to function in situations wherein the
government is seeking to adjust individual controversies
2. Agency of the Government because of a strong social policy involved, e.g., NLRC;
Under the Administrative Code of 1987, the term is used ECC; SEC; DAR; COA.
to refer to any of the various units of the Government, including a g. Bodies set up to make the government a private party, e.g.,
department, bureau, office, instrumentality, or government-owned GSIS.
or controlled corporation, or a local government or a distinct unit h. Agencies set up to function in situations where the
therein [Sec. 2(4), E.O. 292]. government is seeking to conduct investigations and gather
evidence for information, recommendation or prosecution of
3. Administrative Organization crimes.
Administrative organization refers to the administrative
structure of the government including its political subdivisions and 1. Ordinance Power of the President
allocation of powers, functions, and duties to its various units or Sections 2 to 6, Book III, Title I, Chapter 2 of E.O. 292
agencies [De Leon]. provides:

B. CREATION SECTION 2. Executive Orders.—Acts of the

An administrative agency is created by: President providing for rules of a general or permanent character
a. Constitutional provision in implementation or execution of constitutional or statutory
powers shall be promulgated in executive orders.
b. Legislative enactment
SECTION 3. Administrative Orders.—Acts of the
c. Authority of law [Nachura]. President which relate to particular aspects of governmental
operations in pursuance of his duties as administrative head shall
In general, some administrative agencies are created by be promulgated in administrative orders.
or receive their powers from constitutional provisions which may SECTION 4. Proclamations.—Acts of the President
be self-executing, but most of them have their source in legislative fixing a date or declaring a status or condition of public moment
enactments. or interest, upon the existence of which the operation of a
Agencies of statutory origin are subject to expansion or specific law or regulation is made to depend, shall be
promulgated in proclamations which shall have the force of an
contraction of their powers and functions, or to reorganization or
executive order.
abolition at the will of Congress, hamstrung only by constitutional SECTION 5. Memorandum Orders.—Acts of the
limitations. President on matters of administrative detail or of subordinate or
temporary interest which only concern a particular officer or
Reason for creation of administrative agencies office of the Government shall be embodied in memorandum
a. To unclog court dockets orders.
b. To meet the growing complexities of modern society. SECTION 6. Memorandum Circulars.—Acts of the
The ever increasing variety of powers and functions President on matters relating to internal administration, which
the President desires to bring to the attention of all or some of
given to administrative agencies recognizes the need for
the departments, agencies, bureaus or offices of the
the active intervention of administrative agencies in Government, for information or compliance, shall be embodied
matters calling for technical knowledge and speed in in memorandum circulars.

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 SECTION 7. General or Special Orders.—Acts and Matters of day-to-day administration or all those
commands of the President in his capacity as Commander-in- pertaining to internal operations shall be left to the discretion or
Chief of the Armed Forces of the Philippines shall be issued as judgement of the executive officer of the agency or corporation
general or special orders.
[Sec. 38, Ch. 7, Book 4, E.O. 292].
C. ADMINISTRATIVE RELATIONSHIPS UNDER E.O.
D. DEFINITION OF TERMS UNDER E.O. 292
292
1. Government of the Republic of the Philippines
1. Supervision and Control
This refers to the corporate governmental entity through
Supervision and control shall include:
which the functions of the government are exercised throughout the
a. Authority to act directly whenever a specific function is
Philippines, including, save as the contrary appears from the
entrusted by law or regulation to a subordinate;
context, the various arms through which political authority is made
b. Direct performance of duty;
effective in the Philippines, whether pertaining to the autonomous
c. Restraint the commission of acts;
regions, the provincial, city, municipal or barangay subdivisions or
d. Review, approve, reverse or modify acts and decisions
other forms of local government.
of subordinate officials or units;
The term “Government of the Republic of the
e. Determine priorities in the execution of plans and
Philippines” or “Philippine Government” is broad enough to
programs; and
include the local governments and the central or national
f. Prescribe standards, guidelines, plans and programs.
government which, in turn, consist of the legislative, executive, and
judicial branches, as well as constitutional bodies and other bodies
2. Administrative Supervision
created in accordance with the Constitution [Re: Anonymous
Administrative supervision which shall govern the
Complaint Against Pizarro].
administrative relationship between a department or its equivalent
and regulatory agencies or other agencies as may be provided by
2. Agency of the Government
law, shall be limited to the authority of the department or its
This refers to any of the various units of the Government,
equivalent to generally oversee the operations of such agencies and
including a department, bureau, office, instrumentality, or
to insure that they are managed effectively, efficiently and
government-owned or controlled corporations (GOCCs), or a local
economically but without interference with day-to-day activities. It
government or a distinct unit therein.
also includes:
a. Submission of reports and cause the conduct of management
3. Department
audit, performance evaluation and inspection to determine
This refers to an executive department created by law.
compliance with policies, standards and guidelines of the
For purposes of Book IV [Executive Branch], this shall
department;
include any instrumentality, as herein defined, having or assigned
b. Taking action as may be necessary for the proper
the rank of a department regardless of its name or designation.
performance of official functions, including rectification of
violations, abuses and other forms of maladministration;
a. Jurisdiction over Bureaus, Offices,
c. Review and pass upon budget proposals of such agencies
Regulatory Agencies and Government
but may not increase or add to them.
Corporations
Each Department shall have jurisdiction over bureaus,
Such authority shall not, however, extend to:
offices, regulatory agencies, and government-owned or controlled
a. Appointments and other personnel actions in accordance
corporations assigned to it by law, in accordance with the
with the decentralization of personnel functions under the
applicable relationship as defined in Chapters 7, 8, and 9 of this
Code, except when appeal is made from an action of the
Book [Sec. 4, Ch. 1, Book 4, E.O. 292].
appointing authority, in which case the appeal shall be
initially sent to the department or its equivalent, subject to
b.Secretary, Undersecretaries, and Assistant
appeal in accordance with law;
Secretaries
b. Contracts entered into by the agency in the pursuit of its
The authority and responsibility for the exercise of the
objectives, the review of which and other procedures related
mandate of the Department and for the discharge of its powers and
thereto shall be governed by appropriate laws, rules, and
functions shall be vested in the Secretary, who shall have
regulations; and
supervision and control of the Department.
c. The power to review, reverse, revise, or modify the
The Undersecretary shall, among others, advise and
decisions of regulatory agencies in the exercise of their
assist the Secretary in the formulation and implementation of
regulatory or quasi-judicial functions.
department objectives and policies.
The Assistant Secretary shall perform such duties and
3. Attachment
functions as may be provided by law or assigned to him by the
This refers to the lateral relationship between the
Secretary [E.O. 292, Book 4, Ch. 2, Secs. 6, 7, 10 and 11].
department or its equivalent and the attached agency or corporation
for purposes of policy and program coordination. The coordination
c. Appointments and Qualifications
may be accomplished by having the department represented in the
Sections 45 and 46, Chapter 10, Book 4 of E.O. 292
governing board of the attached agency or corporation, either as
provides:
chairman or as a member, with or without voting rights, if this is
permitted by the charter; having the attached corporation or agency Section 45. Qualifications of Secretaries. – The
comply with a system of periodic reporting which shall reflect the Secretaries shall be citizens of the Philippines and not less than
progress of programs and projects; and having the department or its twenty-five (25) years of age.
equivalent provide general policies through its representative in the
board, which shall serve as the framework for the internal policies Section 45. Appointment Undersecretaries and
of the attached corporation or agency. Assistant Secretaries. – The Undersecretaries and Assistant

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 Secretaries of a Department shall, upon the nomination of the Subsequently, in 2011, RA 10149, the GOCC
Secretary of the Department concerned, be appointed by the Governance Act of 2011, further formalized the creation of this
President. new category:

4. Bureau Section 3. Definition of Terms. -

This refers to any principal subdivision or unit of any xxxx
department. (n) Government Instrumentalities with Corporate
For purposes of Book IV, this shall include any principal Powers (GJCP)/Government Corporate Entities (GCE) refer to
subdivision or unit of any instrumentality given or assigned the instrumentalities or agencies of the government, which are
neither corporations nor agencies integrated within the
rank of a bureau, regardless of actual name or designation, as in the
departmental framework, but vested by law with special
case of department-wide regional offices. functions or jurisdiction, endowed with some if not all corporate
A bureau is any principal subdivision of the department powers, administering special funds, and enjoying operational
performing a single major function or closely related functions.
autonomy usually through a charter including, but not limited to,
Bureaus are either staff or line.
the following: the Manila International Airport Authority
(MIAA), the Philippine Ports Authority (PPA), the Philippine
a. Staff Bureau. Deposit Insurance Corporation (PDIC), the Metropolitan
A staff bureau shall primarily perform policy, program Waterworks and Sewerage System (MWSS), the Laguna Lake
development and advisory functions. Development Authority (LLDA), the Philippine Fisheries
Development Authority (PFDA), the Bases Conversion and
b. Line Bureau Development Authority (BCDA), the Cebu Port Authority
A line bureau shall directly implement programs adopted (CPA), the Cagayan de Oro Port Authority, the San Fernando
Port Authority, the Local Water Utilities Administration
pursuant to department policies and plans.
(LWUA) and the Asian Productivity Organization (APO).

5. Office Hence, in addition to government-owned and controlled

This refers, within the framework of governmental corporations (GOCCs) and instrumentalities, a third category of
organization, to any major functional unit of a department or government agencies under the jurisdiction of the OGCC is now
bureau including regional offices. It may also refer to any position recognized -- government instrumentalities vested with corporate
held or occupied by individual persons, whose functions are powers or government corporate entities. These entities remain
defined by law or regulation. government instrumentalities because they are not integrated
within the department framework and are vested with special
6. Instrumentality functions to carry out a declared policy of the national government
An instrumentality is any agency of the National [Philippine Heart Center v. Local Government of Quezon City].
Government, not integrated within the department framework, An agency will be classified as a government
vested with special functions or jurisdiction by law, endowed with instrumentality vested with corporate powers when the following
some if not all corporate powers, administering special funds, and elements concur: a) it performs governmental functions, and b) it
enjoying operational autonomy, usually through a charter [City of enjoys operational autonomy [Philippine Heart Center v. Local
Lapu-Lapu v. PEZA]. Government of Quezon City].
Section 2(10) of the Introductory Provisions of the In the 2006 case of Manila International Airport
Administrative Code defines a government "instrumentality" as Authority v. CA, the Court, speaking through Associate Justice
follows: Antonio T. Carpio, explained in this wise:
Many government instrumentalities are vested with
SEC. 2. General Terms Defined. - x x x x
corporate powers but they do not become stock or non-stock
(10) Instrumentality refers to any agency of the
National Government, not integrated within the department corporations, which is a necessary condition before an agency or
framework, vested with special functions or jurisdiction by law, instrumentality is deemed a [GOCC]. Examples are the Mactan
endowed with some if not all corporate powers, administering International Airport Authority, the Philippine Ports Authority, the
special funds, and enjoying operational autonomy, usually University of the Philippines and Bangko Sentral ng Pilipinas. All
through a charter. x x x these government instrumentalities exercise corporate powers but
they are not organized as stock or non-stock corporations as
University of the Philippines v. City Treasurer of required by Section 2 (13) of the Introductory Provisions of the
Quezon City Administrative Code. These government instrumentalities arc
Irrefragably, the UP is a government instrumentality, performing sometimes loosely called government corporate entities. However,
the State's constitutional mandate of promoting quality and accessible they are not [GOCCs] in the strict sense as understood under the
education. As a government instrumentality, the UP administers special Administrative Code, which is the governing law defining the legal
funds sourced from the fees and income enumerated under Act No. 1870
relationship or status of government entities.
and Section 1 of Executive Order No. 714, and from the yearly
appropriations, to achieve the purposes laid down by Section 2 of Act 1870, Moreover, in the 2007 case of Philippine Fisheries
as expanded in Republic Act No. 9500. All the funds going into the Development Authority v. CA, the Court reiterated that a
possession of the UP, including any interest accruing from the deposit of government instrumentality retains its classification as such albeit
such funds in any banking institution, constitute a "special trust fund," the having been endowed with some if not all corporate powers. The
disbursement of which should always be aligned with the UP's mission and relevant portion of said decision reads as follows:
purpose, and should always be subject to auditing by the COA.
Indeed, the Authority is not a GOCC but an
a. Government Instrumentalities with instrumentality of the government. The Authority has a capital
Corporate Powers (GICP)/Government stock but it is not divided into shares of stocks. Also, it has no
stockholders or voting shares. Hence, it is not a stock
Corporate entities (GCE)
corporation. Neither is it a non-stock corporation because it has
no members.

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 The Authority is actually a national government of the country's fishing industry and improve the efficiency in handling,
instrumentality which is define as an agency of the national preserving, marketing, and distribution of fish and other aquatic products,"
government, not integrated within the department framework, exercises the governmental powers of eminent domain, and the power to
vested with special functions or jurisdiction by law, endowed levy fees and charges. At the same time, the Authority exercises "the
with some if not all corporate powers, administering special general corporate powers conferred by laws upon private and government-
funds and enjoying operational autonomy, usually through a owned or controlled corporations."
charter. When the law vests in a government instrumentality
corporate powers, the instrumentality does not become a
corporation. Unless the government instrumentality is organized City of Lapu-Lapu v. PEZA
as a stock or non-stock corporation, it remains a government Held: Similarly, the PEZA is an instrumentality of the national
instrumentality exercising not only governmental but also government. It is not integrated within the department framework but is an
corporate powers. agency attached to the Department of Trade and Industry. Book IV,
Chapter 7, Section 38(3)(a) of the Administrative Code of 1987 defines
“attachment”:
MIAA v. Court of Appeals SEC. 38. Definition of Administrative Relationship. – Unless
Held: When the law vests in a government instrumentality otherwise expressly stated in the Code or in other laws defining the special
corporate powers, the instrumentality does not become a corporation. relationships of particular agencies, administrative relationships shall be
Unless the government instrumentality is organized as a stock or non-stock categorized and defined as follows:
corporation, it remains a government instrumentality exercising not only ....
governmental but also corporate powers. Thus, MIAA exercises the (3) Attachment.–(a) This refers to the lateral relationship
governmental powers of eminent domain, police authority and the levying between the department or its equivalent and the attached agency or
of fees and charges. At the same time, MIAA exercises "all the powers of a corporation for purposes of policy and program coordination.
corporation under the Corporation Law, insofar as these powers are not Attachment, which enjoys “a larger measure of
inconsistent with the provisions of this Executive Order." independence” compared with other administrative relationships such as
Likewise, when the law makes a government supervision and control, is further explained in Beja, Sr. v. Court of
instrumentality operationally autonomous, the instrumentality remains Appeals:
part of the National Government machinery although not integrated with An attached agency has a larger measure of independence from
the department framework. The MIAA Charter expressly states that the Department to which it is attached than one which is under
transforming MIAA into a "separate and autonomous body" will make its departmental supervision and control or administrative supervision. This is
operation more "financially viable." borne out by the “lateral relationship” between the Department and the
attached agency.
Many government instrumentalities are vested with corporate With the PEZA as an attached agency to the Department of
powers but they do not become stock or non-stock corporations, which is a Trade and Industry, the 13-person PEZA Board is chaired by the
necessary condition before an agency or instrumentality is deemed a Department Secretary. Among the powers and functions of the PEZA is its
government-owned or controlled corporation. Examples are the Mactan ability to coordinate with the Department of Trade and Industry for policy
International Airport Authority, the Philippine Ports Authority, the and program formulation and implementation. In strategizing and
University of the Philippines and Bangko Sentral ng Pilipinas. All these prioritizing the development of special economic zones, the PEZA
government instrumentalities exercise corporate powers but they are not coordinates with the Department of Trade and Industry.
organized as stock or non-stock corporations as required by Section 2(13) The PEZA also administers its own funds and operates
of the Introductory Provisions of the Administrative Code. These autonomously, with the PEZA Board formulating and approving the
government instrumentalities are sometimes loosely called government PEZA’s annual budget. Appointments and other personnel actions in the
corporate entities. However, they are not government-owned or controlled PEZA are also free from departmental interference, with the PEZA Board
corporations in the strict sense as understood under the Administrative having the exclusive and final authority to promote, transfer, assign and
Code, which is the governing law defining the legal relationship and status reassign officers of the PEZA.
of government entities. As an instrumentality of the national government, the PEZA is
vested with special functions or jurisdiction by law. Congress created the
PEZA to operate, administer, manage and develop special economic zones
PFDA v. Court of Appeals in the Philippines.
Held: In the MIAA case, petitioner Philippine Fisheries
Development Authority was cited as among the instrumentalities of the
national government. Thus – Philippine Heart Center v. Local Government of
Some of the national government instrumentalities vested by Quezon City
law with juridical personalities are: Bangko Sentral ng Pilipinas, Held: An agency will be classified as a government
Philippine Rice Research Institute, Laguna Lake Development instrumentality vested with corporate powers when the following elements
Authority, Fisheries Development Authority, Bases Conversion concur: a) it performs governmental functions, and b) it enjoys operational
Development Authority, Philippine Ports Authority, Cagayan de Oro Port autonomy. The PHC passes these twin criteria.
Authority, San Fernando Port Authority, Cebu Port Authority, and Although not integrated in the department framework, the PHC
Philippine National Railways. is under supervision of the DOH and carries out government policies in
Indeed, the Authority is not a GOCC but an instrumentality of pursuit of its objectives in Section 4 of PD 673.
the government. The Authority has a capital stock but it is not divided into Certainly, the PHCs' enumerated functions are less commercial
shares of stocks. Also, it has no stockholders or voting shares. Hence, it is than governmental, and more for public use and public welfare than for
not a stock corporation. Neither it is a non-stock corporation because it has profit-oriented services. As such, the PHC is authorized to "call upon any
no members. department, bureau, office, agency or instrumentality of the Government,
The Authority is actually a national government instrumentality including government-owned or controlled corporations, for such assistance
which is defined as an agency of the national government, not integrated as it may need in the pursuit of its purposes and objectives."
within the department framework, vested with special functions or Too, the PHC is vested with corporate powers under Section 5
jurisdiction by law, endowed with some if not all corporate powers, of PD 673.
administering special funds, and enjoying operational autonomy, usually
through a charter. When the law vests in a government instrumentality BCDA v. Commissioner of Internal Revenue
corporate powers, the instrumentality does not become a corporation. Held: The grant of these corporate powers is likewise stated in
Unless the government instrumentality is organized as a stock or non-stock Section 3 of Republic Act (R.A.) No. 7227; also known as The Bases
corporation, it remains a government instrumentality exercising not only Conversion and Development Act of 1992 which provides for BCDA's
governmental but also corporate powers. manner of creation, to wit:
Thus, the Authority which is tasked with the special public
function to carry out the government's policy "to promote the development

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 Sec. 3. Creation of the Bases Conversion and Development which includes public airports and seaports, as properties of public
Authority. - There is hereby created a body corporate to be known as the dominion and owned by the Republic. As properties of public dominion
Bases Conversion and Development Authority, which shall have the owned by the Republic, there is no doubt whatsoever that the Airport Lands
attribute of perpetual succession and shall be vested with the powers of a and Buildings are expressly exempt from real estate tax under Section
corporation. (Emphasis Ours) 234(a) of the Local Government Code. This Court has also repeatedly
From the foregoing, it is clear that a government instrumentality ruled that properties of public dominion are not subject to execution or
may be endowed with corporate powers and at the same time retain its foreclosure sale.
classification as a government "instrumentality" for all other purposes.
MWSS v. Local Government of Quezon City
Economic Viability Held: In 2011, Congress passed Republic Act No. 10149 or the
Government instrumentalities vested with corporate GOCC Governance Act of 2011, which adopted the same categorization
powers and performing governmental or public functions need not and explicitly lists petitioner together with the other government agencies
meet the test of economic viability. These instrumentalities that were previously held by this Court to be exempt from the payment of
perform essential public services for the common good, services real property taxes:
(n) Government Instrumentalities with Corporate Powers
that every modern State must provide its citizens. These
(GICP)/Government Corporate Entities (GCE) refer to instrumentalities or
instrumentalities need not be economically viable since the agencies of the government, which are neither corporations nor agencies
government may even subsidize their entire operations. These integrated within the departmental framework, but vested by law with
instrumentalities are not GOCCs referred to in Section 16, Article special functions or jurisdiction, endowed with some if not all corporate
XII of the 1987 Constitution [City of Lapu-Lapu v. PEZA]. powers, administering special funds, and enjoying operational autonomy
usually through a charter including, but not limited to, the following: the
b. Exemption from Real Property Tax Manila International Airport Authority (MIAA), the Philippine Ports
A government instrumentality though vested with Authority (PPA), the Philippine Deposit Insurance Corporation (PDIC),
the Metropolitan Waterworks and Sewerage System (MWSS), the Laguna
corporate powers are exempt from real property tax, but the
Lake Development Authority (LLDA), the Philippine Fisheries
exemption shall not extend to taxable private entities to whom the Development Authority (PFDA), the Bases Conversion and Development
beneficial use of the government instrumentality’s properties has Authority (BCDA), the Cebu Port Authority (CPA), the Cagayan de Oro
been vested [LRTA v. Quezon City]. Port Authority, the San Fernando Port Authority, the Local Water Utilities
Administration (LWUA) and the Asian Productivity Organization (APO).
PFDA v. Court of Appeals The Executive and Legislative Branches, therefore, have already
Held: The MIAA case held that unlike categorized petitioner not as a government-owned and controlled
GOCCs, instrumentalities of the national government, like MIAA, are corporation but as a Government Instrumentality with Corporate
exempt from local taxes pursuant to Section 133(o) of the Local Powers/Government Corporate Entity like the Manila International Airport
Government Code. This exemption, however, admits of an exception with Authority and the Philippine Fisheries Development Authority. Privileges
respect to real property taxes. Applying Section 234(a) of the Local enjoyed by these Government Instrumentalities with Corporate
Government Code, the Court ruled that when an instrumentality of the Powers/Government Corporate Entities should necessarily also extend to
national government grants to a taxable person the beneficial use of a real petitioner. Hence, petitioner's real property tax exemption under Republic
property owned by the Republic, said instrumentality becomes liable to pay Act No. 6234 is still valid as the proviso of Section 234 of the Local
real property tax. Government Code is only applicable to government-owned and -controlled
In light of the foregoing, the Authority should be classified as an corporations.
instrumentality of the national government which is liable to pay taxes only Thus, petitioner is not liable to respondent Local Government of
with respect to the portions of the property, the beneficial use of which Quezon City for real property taxes, except if the beneficial use of its
were vested in private entities. When local governments invoke the power properties has been extended to a taxable person.
to tax on national government instrumentalities, such power is construed
strictly against local governments. The rule is that a tax is never presumed Beneficial Use
and there must be clear language in the law imposing the tax. Any doubt Beneficial use means that the person or entity has the
whether a person, article or activity is taxable is resolved against taxation. actual use and possession of the property. Stated differently, it is
This rule applies with greater force when local governments seek to tax
the actual and beneficial user of the subject property that shall be
national government instrumentalities.
Thus, the real property tax assessments issued by the City of directly liable for the real property taxes on the property owned by
Iloilo should be upheld only with respect to the portions leased to private the government [City Treasurer v. BCDA].
persons. In case the Authority fails to pay the real property taxes due
thereon, said portions cannot be sold at public auction to satisfy the tax GSIS v. City Treasurer of Manila
delinquency. Held: In sum, the Court finds that GSIS enjoys under its charter
full tax exemption. Moreover, as an instrumentality of the national
Mactan-Cebu IAA v. City of Lapu-Lapu government, it is itself not liable to pay real estate taxes assessed by the
Held: Under Section 2(10) and (13) of the Introductory City of Manila against its Katigbak and Concepcion-Arroceros properties.
Provisions of the Administrative Code, which governs the legal relation and Following the "beneficial use" rule, however, accrued real property taxes
status of government units, agencies and offices within the entire are due from the Katigbak property, leased as it is to a taxable entity. But
government machinery, MIAA is a government instrumentality and not a the corresponding liability for the payment thereof devolves on the taxable
government-owned or controlled corporation. Under Section 133(o) of the beneficial user. The Katigbak property cannot in any event be subject of a
Local Government Code, MIAA as a government instrumentality is not a public auction sale, notwithstanding its realty tax delinquency. This means
taxable person because it is not subject to “[t]axes, fees or charges of any that the City of Manila has to satisfy its tax claim by serving the accrued
kind” by local governments. The only exception is when MIAA leases its realty tax assessment on MHC, as the taxable beneficial user of the
real property to a “taxable person” as provided in Section 234(a) of the Katigbak property and, in case of nonpayment, through means other than
Local Government Code, in which case the specific real property leased the sale at public auction of the leased property.
becomes subject to real estate tax. Thus, only portions of the Airport
Lands and Buildings leased to taxable persons like private parties are 7. Regulatory Agency
subject to real estate tax by the City of Parañaque. This refers to any agency expressly vested with
Under Article 420 of the Civil Code, the Airport Lands and jurisdiction to regulate, administer or adjudicate matters affecting
Buildings of MIAA, being devoted to public use, are properties of public substantial rights and interests of private persons, the principal
dominion and thus owned by the State or the Republic of the Philippines.
Article 420 specifically mentions “ports x x x constructed by the State,”

Page 6 of 16
powers of which are exercised by a collective body, such as a Three requisites must concur for one to be classified as a
commission, board or council. stock corporation, viz:
Example: The Philippine Competition Commission
(PCC) is a regulatory body mandated to implement the national i. It has capital stock,
competition policy, and enforce RA 10667 or the Philippine ii. The capital stock is divided into shares, and
Competition Act (PCA), which serves as the country’s primary iii. It is authorized to distribute dividends and
competition law for promoting and protecting competitive markets. allotments of surplus and profits to its stockholders.

8. Chartered Institution A non-stock corporation, on the other hand, is one where

This refers to any agency organized or operating under a no part of its income is distributable as dividends to its members,
special charter, and vested by law with functions relating to trustees, or officers. A non-stock corporation must have members
specific constitutional policies or objectives. and must not distribute any part of their income to said members.
This term includes state universities and colleges and the [LRTA v. Quezon City].
monetary authority of the State.
MIAA v. Court of Appeals
9. Government-Owned or Controlled Corporation Held: MIAA is not organized as a stock or non-stock
Section 2(13) of the Introductory Provisions of the corporation. MIAA is not a stock corporation because it has no capital
Administrative Code of 1987 defines a government-owned or stock divided into shares. MIAA has no stockholders or voting shares.
controlled corporation as follows: Section 10 of the MIAA Charter provides:
SECTION 10. Capital. - The capital of the Authority to be
contributed by the National Government shall be increased from Two and
SEC. 2. General Terms Defined. - x x x x
One-half Billion (P2,500,000,000.00) Pesos to Ten Billion
(13) Government-owned or controlled corporation
(P10,000,000,000.00) Pesos to consist of:
refers to any agency organized as a stock or non-stock
(a) The value of fixed assets including airport facilities, runways
corporation, vested with functions relating to public needs
and equipment and such other properties, movable and immovable[,] which
whether governmental or proprietary in nature, and owned by
may be contributed by the National Government or transferred by it from
the Government directly or through its instrumentalities either
any of its agencies, the valuation of which shall be determined jointly with
wholly, or, where applicable as in the case of stock corporations,
the Department of Budget and Management and the Commission on Audit
to the extent of at least fifty-one (51) percent of its capital stock:
on the date of such contribution or transfer after making due allowances for
x x x. (Emphasis supplied)
depreciation and other deductions taking into account the loans and other
A government-owned or controlled corporation must
liabilities of the Authority at the time of the takeover of the assets and other
be "organized as a stock or non-stock corporation."
properties;
(b) That the amount of P605 million as of December 31, 1986
In Republic Act No. 10149, otherwise known as the representing about seventy percentum (70%) of the unremitted share of the
GOCC Governance Act of 2011, the term is defined in Section National Government from 1983 to 1986 to be remitted to the National
3(o): Treasury as provided for in Section 11 of E. O. No. 903 as amended, shall
be converted into the equity of the National Government in the Authority.
SECTION 3. Definition of Terms. — Thereafter, the Government contribution to the capital of the Authority
(o) Government-Owned or -Controlled shall be provided in the General Appropriations Act.
Corporation (GOCC) refers to any agency organized as a stock Clearly, under its Charter, MIAA does not have capital stock
or nonstock corporation, vested with functions relating to public that is divided into shares
needs whether governmental or proprietary in nature, and owned Section 3 of the Corporation Code defines a stock corporation as
by the Government of the Republic of the Philippines directly or one whose "capital stock is divided into shares and x x x authorized to
through its instrumentalities either wholly or, where applicable distribute to the holders of such shares dividends x x x." MIAA has
as in the case of stock corporations, to the extent of at least a capital but it is not divided into shares of stock. MIAA has no stockholders
majority of its outstanding capital stock: Provided, however, or voting shares. Hence, MIAA is not a stock corporation.
That for purposes of this Act, the term "GOCC" shall include MIAA is also not a non-stock corporation because it has no
GICP/GCE and GFI as defined herein. members. Section 87 of the Corporation Code defines a non-stock
corporation as "one where no part of its income is distributable as dividends
A GOCC refers to any agency organized as a stock or to its members, trustees or officers." A non-stock corporation must have
non-stock corporation, vested with functions relating to public members. Even if we assume that the Government is considered as the sole
member of MIAA, this will not make MIAA a non-stock corporation. Non-
needs whether governmental or proprietary in nature, and owned
stock corporations cannot distribute any part of their income to their
by the Government directly or through its instrumentalities either members. Section 11 of the MIAA Charter mandates MIAA to remit 20%
wholly, or, where applicable as in the case of stock corporations, to of its annual gross operating income to the National Treasury. [11] This
the extent of at least fifty-one (51) per cent of its capital stock: prevents MIAA from qualifying as a non-stock corporation.
Provided, That government-owned or controlled corporations may
be further categorized by the Department of the Budget, the Civil b. Attributes
Service Commission, and the Commission on Audit for purposes A government-owned or controlled corporation is:
of the exercise and discharge of their respective powers, functions
and responsibilities with respect to such corporations. (i) established by original charter or through the
Under RA 10149, or the GOCC Governance Act of 2011, general corporation law;
the term “GOCC” shall include GICP/GCE and GFI as defined. (ii) vested with functions relating to public need
whether governmental or propriety in nature; and
a. Stock or Non-Stock Corporation (iii) directly owned by the government or by its
An agency is a government-owned or controlled instrumentality, or where the government owns a
corporation when it is organized as stock or non-stock corporation. majority of the outstanding capital stock.
A stock corporation is one that sources its capital through
shares of stock and therefore has a share capital or capital stock, Possessing all three attributes is necessary to be classified
not just capital, whose capital stock is divided into shares, and who as a GOCC [GSIS Family Bank Employees v. Villanueva].
is authorized to distribute dividend to the holders of such share.
Page 7 of 16
 An entity is considered a government-owned or provided in its Articles of Incorporation, the members of Corregidor
controlled corporation if all three (3) attributes are present: Foundation, Inc. must be government officials who shall hold their
membership by reason of their office.
(i) The entity is organized as a stock or non-stock In sum, Corregidor Foundation, Inc. is a government-owned or
controlled corporation. Thus, it is under the audit jurisdiction of the
corporation;
Commission on Audit.
(ii) Its functions are public in character; and
(iii) It is owned, or at the very least, controlled by
c. Parent Corporation vs. Subsidiary
the government [Oriondo v. COA].
Corporation
A corporation is a government-owned or controlled
Funa v. MECO
corporation when the government directly or indirectly owns or
Held: The categorical exclusion of the MECO from a GOCC
makes it easier to exclude the same from any other class of government controls at least a majority or 51% share of the capital stock.
instrumentality. The other government instrumentalities i.e., the regulatory A government-owned or controlled corporation is either
agencies, chartered institutions and GCE/GICP are all, by explicit or a parent corporation, i.e., one “created by special law” or a
implicit definition, creatures of the law. The MECO cannot be any other subsidiary corporation, i.e., one created pursuant to law where at
instrumentality because it was, as mentioned earlier, merely incorporated least a majority of the outstanding voting capital stock is owned by
under the Corporation Code. the parent government corporation and /or other government-
Hence, unless its legality is questioned, and in this case it was owned subsidiaries [Tetangco v. COA].
not, the fact that the MECO is operating under the policy supervision of the
DTI is no longer a relevant issue to be reckoned with for purposes of this
case. d. Economic Viability
For whatever it is worth, however, and without justifying Section 16, Article XII of the 1987 Constitution provides
anything, it is easy enough for this Court to understand the rationale, or as follows:
necessity even, of the executive branch placing the MECO under the policy
supervision of one of its agencies. Section 16. The Congress shall not, except by
It is evident, from the peculiar circumstances surrounding its general law, provide for the formation, organization, or
incorporation, that the MECO was not intended to operate as any other regulation of private corporations. Government-owned or
ordinary corporation. And it is not. Despite its private origins, and perhaps controlled corporations may be created or established by special
deliberately so, the MECO was “entrusted” by the government with the charters in the interest of the common good and subject to the
“delicate and precarious” responsibility of pursuing “unofficial” relations test of economic viability.
with the people of a foreign land whose government the Philippines is
bound not to recognize. The intricacy involved in such undertaking is the The fundamental provision above authorizes Congress to
possibility that, at any given time in fulfilling the purposes for which it was create GOCCs through special charters on two conditions: 1) the
incorporated, the MECO may find itself engaged in dealings or activities
GOCC must be established for the common good; and 2) the
that can directly contradict the Philippines’ commitment to the One
China policy of the PROC. Such a scenario can only truly be avoided if the GOCC must meet the test of economic viability [Republic v. City
executive department exercises some form of oversight, no matter how of Paranaque].
limited, over the operations of this otherwise private entity. Thus, under the Constitution, GOCCs are created in the
Indeed, from hindsight, it is clear that the MECO is uniquely interest of common good and should satisfy the test of ecomic
situated as compared with other private corporations. From its over- viability. Economic viability is the capacity to function efficiently
reaching corporate objectives, its special duty and authority to exercise in business. To be economically viable, the entity should not go
certain consular functions, up to the oversight by the executive department into activities which the private sector can do better [City of Lapu-
over its operations—all the while maintaining its legal status as a non-
Lapu v. PEZA].
governmental entity—the MECO is, for all intents and purposes, sui
generis. The test of economic viability applies only to
government-owned or controlled corporations that perform
economic or commercial activities and need to compete in the
Oriondo v. Commission on Audit
market place. Being essentially economic vehicles of the State for
Held: At any rate, even if it were true that Corregidor
Foundation, Inc. is funded by international organizations and foreign
the common good — meaning for economic development purposes
entities, these foreign grants already became public funds the moment they — these government-owned or controlled corporations with special
were donated to Corregidor Foundation, Inc. Thus, these funds may be charters are usually organized as stock corporations just like
audited by the Commission on Audit. The Court elucidated in Fernando v. ordinary private corporations. In contrast, government
Commission on Audit: instrumentalities vested with corporate powers and performing
[D]espite the private source of funds, ownership over the same governmental or public functions need not meet the test of
was already transmitted to the government by way of donation. As donee, economic viability. These instrumentalities perform essential
the government had become the owner of the funds, with full ownership
public services for the common good, services that every modern
rights and control over the use and disposition of the same, subject only to
applicable laws and COA rules and regulations. Thus, upon donation to the State must provide its citizens. These instrumentalities need not be
government, the funds became public in character. economically viable since the government may even subsidize their
This is in contrast to cases where there is no transfer of entire operations. These instrumentalities are not the "government-
ownership over the funds from private parties to the government, such as in owned or controlled corporations" referred to in Section 16, Article
the case of cash deposits required in election protests filed before the trial XII of the 1987 Constitution [Republic v. City of Paranaque].
courts, Commission on Elections, and electoral tribunals. In these cases, the
government becomes a mere depositary of such fund, the use and
Republic v. City of Paranaque
disposition of which is subject to the conformity of the private party-
Held: In this case, PRA may have passed the first condition of
depositor who remains to be the owner thereof.
common good but failed the second one - economic viability. Undoubtedly,
Lastly, while it is true that just like any other corporation
the purpose behind the creation of PRA was not for economic or
organized under the Corporation Code, Corregidor Foundation, Inc. may
commercial activities. Neither was it created to compete in the market place
determine voluntarily and solely the successors of its members in
considering that there were no other competing reclamation companies
accordance with its own by-laws, this does not change the public character
being operated by the private sector. As mentioned earlier, PRA was
of its functions and the control the government has over it. As discussed,
the promotion and development of tourism is a public function and, as created essentially to perform a public service considering that it was

Page 8 of 16
primarily responsible for a coordinated, economical and efficient of law. On the other hand, implied powers are those that can be
reclamation, administration and operation of lands belonging to the inferred or are implicit in the wordings of the law or conferred by
government with the object of maximizing their utilization and hastening necessary or fair implication in the enabling act [Chavez v. NHA].
their development consistent with the public interest. They have in fine only such powers or authority as are
granted or delegated, expressly or impliedly by law. And in
City of Lapu-Lapu v. PEZA determining whether an agency has certain powers, the inquiry
Held: Clearly, the test of economic viability does not apply to should be from the law itself. But once ascertained as existing, the
government entities vested with corporate powers and performing essential authority given should be liberally construed [Soriano v.
public services. The State is obligated to render essential public services Laguardia].
regardless of the economic viability of providing such service. The non-
economic viability of rendering such essential public service does not
excuse the State from withholding such essential services from the public. 3. Investigatory or Inquisitorial Powers
The law created the PEZA’s charter. Under the Special These powers include the power of an administrative
Economic Zone Act of 1995, the PEZA was established primarily to body to inspect the records and premises, and investigate the
perform the governmental function of operating, administering, managing, activities of persons or entities coming under its jurisdiction, or to
and developing special economic zones to attract investments and provide secure, or to inquire the disclosure of information by means of
opportunities for preferential use of Filipino labor. accounts, records, reports, statements, testimony of witnesses,
Under its charter, the PEZA was created a body corporate production of documents, or otherwise. They are conferred on
endowed with some corporate powers. However, it was not organized as a
practically all administrative agencies.
stock or non-stock corporation. Nothing in the PEZA’s charter provides
that the PEZA’s capital is divided into shares. The PEZA also has no
members who shall share in the PEZA’s profits. 4. Rule-Making Power
The PEZA does not compete with other economic zone Administrative regulations or subordinate legislation
authorities in the country. The government may even subsidize the PEZA’s calculated to promote the public interest are necessary because of
operations. Under Section 47 of the Special Economic Zone Act of 1995, the growing complexity of modern life, the multiplication of the
“any sum necessary to augment [the PEZA’s] capital outlay shall be subjects of governmental regulations, and the increased difficulty
included in the General Appropriations Act to be treated as an equity of the of administering the law [Belgica v. Executive Secretary].
national government.” Administrative agencies may exercise quasi-legislative or
The PEZA, therefore, need not be economically viable. It is not rule-making powers only if there exists a law which delegates these
a government-owned or controlled corporation liable for real property powers to them [Republic v. Drugmaker’s Laboratory].
taxes. The grant of rule-making power to administrative
agencies is a relaxation of the principle of separation of powers and
RULES TO REMEMBER is an exception to the non-delegation of legislative powers [Belgica
a. All administrative agencies are public offices, but not all v. Executive Secretary].
public offices are administrative agencies (e.g., Congress,
courts) III
b. All administrative agencies are government agencies, all QUASI-LEGISLATIVE POWER
government agencies are administrative agencies.
c. All public corporations are administrative agencies, not all
Quasi-legislative power is exercised by administrative
administrative agencies are not public corporations (e.g.
agencies through the promulgation of rules and regulations within
departments, government instrumentalities, commissions)
the confines of the granting statute and the doctrine of non-
d. GOCCs are corporations, government instrumentalities are
delegation of powers from the separation of the branches of the
not.
government. Hence, the need to delegate to administrative bodies –
e. GOCCs must meet twin constitutional test of common good
the principal agencies tasked to execute laws in their specialized
and economic viability. Government instrumentalities, on the
fields – the authority to promulgate rules and regulations to
other hand do not need to meet the twin test.
implement a given statute and effectuate its policies [H. Villarica
f. There are chartered (special) and non-chartered GOCCs
Pawnshop v. SSC].
(Corporation Code)
Accordingly, the rules so promulgated must be within the
confines of the granting statute and must involve no discretion as to
E. POWERS AND FUNCTIONS OF ADMINSITRATIVE
what the law shall be, but merely the authority to fix the details in
AGENCIES
the execution or enforcement of the policy set out in the law itself,
Administrative agencies have powers and functions
so as to conform with the doctrine of separation of powers and, as
which may be administrative, investigatory, regulatory, quasi-
an adjunct, the doctrine of non-delegability of legislative power
legislative, or quasi-judicial, or a mix of the five, as may be
[Republic v. Drug Maker’s Laboratories].
conferred by the Constitution of by statute [Soriano v. Laguardia].
The rules and regulations that administrative agencies
promulgate, which are the product of a delegated legislative power
1. Rules of Construction
to create new and additional legal provisions that have the effect of
Statutes conferring powers on administrative agencies
law, should be within the scope of the statutory authority granted
must be liberally construed to enable them to discharge their
by the legislature to the administrative agency. It is required that
assigned duties in accordance with the legislative purpose [Solid
the regulation be germane to the objects and purposes of the law,
Homes v. Payawal].
and be not in contradiction to, but in conformity with, the standards
prescribed by law. They must conform to and be consistent with
2. Express and Implied Powers
the provisions of the enabling statute in order for such rule or
Basic in administrative law is the doctrine that a
regulation to be valid. Constitutional and statutory provisions
government agency or office has express and implied powers based
control with respect to what rules and regulations may be
on its charter and other pertinent statutes.
promulgated by an administrative body, as well as with respect to
Express powers are those powers granted, allocated, and
what fields are subject to regulation by it. It may not make rules
delegated to a government agency or office by express provisions
and regulations which are inconsistent with the provisions of the
Page 9 of 16
Constitution or a statute, particularly the statute it is administering assailed Memorandum implementing certain provisions of the Billing
or which created it, or which are in derogation of, or defeat, the Circular. This was taken by petitioners as a clear denial of the requests
purpose of a statute. In case of conflict between a statute and an contained in their previous letters, thus prompting them to seek judicial
administrative order, the former must prevail [Smart relief.
In like manner, the doctrine of primary jurisdiction applies only
Communications v. NTC].
where the administrative agency exercises its quasi-judicial or adjudicatory
It is undisputed that in administrative law, function. Thus, in cases involving specialized disputes, the practice has
contemporaneous and practical interpretation of law by been to refer the same to an administrative agency of special competence
administrative officials charged with its administration and pursuant to the doctrine of primary jurisdiction.
enforcement carries great weight and should be respected, unless In the case at bar, the issuance by the NTC of Memorandum
contrary to law or manifestly erroneous [DLS-AU v. Bernardo]. Circular No. 13-6-2000 and its Memorandum dated October 6, 2000 was
pursuant to its quasi-legislative or rule-making power. As such, petitioners
Quasi-Legislative vs. Quasi-Judicial were justified in invoking the judicial power of the Regional Trial Court to
assail the constitutionality and validity of the said issuances.
Not to be confused with the quasi-legislative or rule-
making power of an administrative agency is its quasi-judicial or
administrative adjudicatory power. This is the power to hear and A. “RULE” AS DEFINED UNDER E.O. 292
determine questions of fact to which the legislative policy is to “Rule” means any agency statement of general
apply and to decide in accordance with the standards laid down by applicability that implements or interprets a law, fixes and
the law itself in enforcing and administering the same law. The describes procedures in, or practice requirements of, an agency,
administrative body exercises its quasi-judicial power when it including its regulations. The term includes memoranda or
performs in a judicial manner an act which is essentially of an statements concerning internal administration or management of an
executive or administrative nature, where the power to act in such agency not affecting the rights of, or procedure available to, the
manner is incidental to or reasonably necessary for the public [Book 7, Ch. 1, Sec. 2, E.O. 292].
performance of the executive or administrative duty entrusted to it.
In carrying out their quasi-judicial functions, the administrative B. TWO TESTS FOR VALID DELEGATION
officers or bodies are required to investigate facts or ascertain the To validly exercise quasi-legislative powers,
existence of facts, hold hearings, weigh evidence, and draw administrative agencies must comply with two (2) tests: (1) the
conclusions from them as basis for their official action and exercise completeness test; and (2) the sufficient standard test.
of discretion in a judicial nature [Smart Communications v. NTC]. Furthermore, the Administrative Code requires that
administrative agencies file with the University of the Philippines
Law Center the rules they adopt, which will then be effective 15
days after filing [Acosta v. Ochoa].

1. Completeness Test
The completeness test requires that the law to be
implemented be “complete and should set forth therein the policy
to be executed, carried out or implemented by the delegate.”

2. Sufficient Standard Test

The sufficient standard test requires that the law to be
implemented contain "adequate guidelines ... to map out the
boundaries of the delegate's authority. To be sufficient, the standard
must specify the limits of the delegate's authority, announce the
legislative policy, and identify the conditions under which it is to
Smart Communications v. NTC be implemented." Furthermore, the Administrative Code requires
Held: In questioning the validity or constitutionality of a rule or
that administrative agencies file with the University of the
regulation issued by an administrative agency, a party need not exhaust
administrative remedies before going to court. This principle applies only
Philippines Law Center the rules they adopt, which will then be
where the act of the administrative agency concerned was performed effective 15 days after filing [Acosta v. Ochoa].
pursuant to its quasi-judicial function, and not when the assailed act
pertained to its rule-making or quasi-legislative power. In Association of C. FORCE AND EFFECT OF LAW; BINDING
Philippine Coconut Dessicators v. Philippine Coconut Authority, it was Rules and regulations issued by administrative authorities
held: pursuant to the powers delegated to them have the force and effect
The rule of requiring exhaustion of administrative remedies of law; they are binding on all persons subject to them, and the
before a party may seek judicial review, so strenuously urged by the
court will take judicial notice of them [Nachura].
Solicitor General on behalf of respondent, has obviously no application
here. The resolution in question was issued by the PCA in the exercise of its Administrative issuances partake of the nature of a
rule- making or legislative power. However, only judicial review of statute and have in their favor a presumption of legality [Land
decisions of administrative agencies made in the exercise of their quasi- Bank v. American Rubber Corp].
judicial function is subject to the exhaustion doctrine.
Even assuming arguendo that the principle of exhaustion of Implementing Rules and Regulations vs. Interpretative
administrative remedies apply in this case, the records reveal that Rules and Regulations
petitioners sufficiently complied with this requirement. Even during the Implementing rules and regulations have the force and
drafting and deliberation stages leading to the issuance of Memorandum
effect of law, and are just as binding upon all parties, as if they had
Circular No. 13-6-2000, petitioners were able to register their protests to the
proposed billing guidelines. They submitted their respective position papers been written in the original law itself. Interpretative rules and
setting forth their objections and submitting proposed schemes for the regulations, on the other hand, do not have the force of law;
billing circular. After the same was issued, petitioners wrote successive validity is subject to challenges in court.
letters dated July 3, 2000 and July 5, 2000, asking for the suspension and
reconsideration of the so-called Billing Circular. These letters were not
acted upon until October 6, 2000, when respondent NTC issued the second
Page 10 of 16
 How about procedure? Rules prescribing the methods of does not place the
procedure have the effect of law, and are binding on both the government in
estoppel to correct or
agency and on respondent parties.
overrule the same

D. CANNOT AMEND AND EXTEND LAW 1. Supplementary or Detailed Legislation

Administrative regulations must be in harmony with the This power refers to the rule-making power by reason of
provisions of the law for administrative regulations cannot extend particular delegation of authority [De Leon]. The supplementary
the law or amend a legislative enactment. Administrative issuances regulation is intended to fill in the details of the law and to make
must not override, but must remain consistent with the law they explicit what is only general.” Its purpose is to enlarge upon a
seek to apply and implement. They are intended to carry out, not to statute, subject only to the standards fixed therein, to ensure its
supplant or modify the law. Administrative or executive acts, effective enforcement in accordance with the legislative will
orders and regulations shall be valid only when they are not [Cruz].
contrary to the laws or the Constitution [DAR v. Carriedo]. Legislative rules are in the nature of subordinate
It is only Congress which has the power to repeal or legislation and designed to implement a primary legislation by
amend the law [Purisima v. Philippine Tobacco Institute]. providing the details thereof. They usually implement existing law,
Administrative IRRs adopted by a particular department imposing general, extra-statutory obligations pursuant to authority
of the Government under legislative authority must be in harmony properly delegated by Congress and effect a change in existing law
with the provisions of the law, and should be for the sole purpose or policy which affects individual rights and obligations [Republic
of carrying the law's general provisions into effect. The law itself v. Drugmaker’s Laboratories].
cannot be expanded by such IRRSs, because an administrative
agency cannot amend an act of Congress [Inmates of New Bilibid Absence of IRR
Prison v. De Lima]. To rule that the absence of implementing rules can render
ineffective an act of Congress would empower the administrative
E. ADMINISTRATIVE REGULATIONS bodies to defeat the legislative will by delaying the implementing
Administrative rules or regulations are either legislative rules [SEC v. Interport Corp].
or interpretative.
Legislative regulations are either supplementary or 2. Interpretative Legislation
contingent. Supplementary or detailed legislation are rules and This refers to the rule-making power by the construction
regulations “to fix the details” in the execution and enforcement of and interpretation of a statute being administered.
a policy set out in the law, e.g., Rules and Regulations Interpretative rules are intended to interpret, clarify or
Implementing the Labor Code. Contingent legislation are rules and explain existing statutory regulations under which the
regulations made by an administrative authority on the existence of administrative bodies operate. Their purpose or objective is merely
certain facts or things upon which the enforcement of the law to construe the statute being administered and purport to do no
depends. more than interpret the statute. Simply, they try to say what the
Interpretative legislation are rules and regulations statute means and refer to no single person or party in particular but
construing or interpreting the provisions of a statute to be enforced concern all those belonging to the same class, which may be
and they are binding on all concerned until they are changed, e.g., covered by the said rules [Republic v. Drugmaker’s Laboratories].
BIR Circulars, CB circulars, etc.. They have the effect of law and
are entitled to great respect; they have in their favor the No Publication or Hearing Requirement
presumption of legality [Gonzalez v. Land Bank]. The erroneous It need not be published and neither is a hearing required
application of the law by public officers does not bar a subsequent since it is issued by the administrative body as an incident of its
correct application of the law [Manila Jockey Club v. Court of power to enforce the law and is intended merely to clarify statutory
Appeals]. provisions for proper observance by the people [Roxas & Company
v. DAMBA-NSFW].
Legislative vs. Interpretative Rules
NOTE: When an administrative or executive agency
LEGISLATIVE INTERPRETATIVE renders an opinion, the administrative interpretation of the law is at
Power to create Embody new law Merely clarify or provide
new law/interpret guidelines to the law
best advisory, for it is the courts that finally determine what the law
existing law they interpret means [Cruz].
Need for express Maybe issued only Maybe issued as a
delegation under express necessary incident of the 3. Contingent Legislation
delegation of law administration of a They are rules and regulations made by an administrative
regulatory statute
authority on the existence of certain facts or things upon which the
Presence of Force and effect of Are but statutory
statutory sanction law interpretations, which enforcement of the law depends [Republic v. Drugmaker’s
have behind them no Laboratories].
statutory sanction Contingent legislation or determination, under delegated
Binding force and Same force and Always subject to power, whether a statute shall go into effect. Congress may provide
effect effect as valid judicial determination
that a law shall take effect upon the happening of future specified
statutes that they are erroneous,
even when their issuance contingencies leaving to some other person or body the power to
is authorized by statute determine when the specified contingency has arisen [De Leon].
Consequence of No vested right can In other words, administrative agencies are allowed to
wrong construction be acquired on a ascertain the existence of particular contingencies and on the basis
wrong construction
thereof or enforce or suspend the operation of a law. Such
of the law by
administration contingent regulations have the force and effect of law [Cruz].
officials and such What is left for the executive branch or the concerned
wrong interpretation administrative agency when it formulates rules and regulations
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implementing the law is to ascertain facts necessary to bring the (3) It must be within the scope of the authority given by
law into actual operation [ABAKADA v. Purisima]. the legislature; and
(4) It must be reasonable.
SUMMARY
1. Must be Authorized by the Legislature
TYPE GRANT PUBLICATION Authority to promulgate the regulation is usually
Supplementary Express/implied Required conferred by the charter itself of the administrative body or by the
Interpretative Express/implied X law it is supposed to enforce [Cruz].
Contingent Express Required
Penal Express Required 2. Promulgated in accordance with the Prescribed
Procedural Express/implied Required Procedure
Internal Express/implied X As in the enactment of laws, the general rule is that, the
promulgation of administrative issuances does not require previous
F. NOTICE AND HEARING REQUIREMENT notice and hearing. The only exception being where the legislature
As a rule, the issuance of rules and regulations in the itself requires it and mandates that the regulation shall be based on
exercise of an administrative agency’s quasi-legislative power does certain facts as determined at an appropriate investigation [Cruz].
not require notice and hearing. Anent the second requisite, that is, that the order must
In Abella, Jr. v. Civil Service Commission, it was held be issued or promulgated in accordance with the prescribed
that prior notice and hearing are not essential to the validity of rules procedure, it is necessary that the nature of the administrative
and regulations issued in the exercise of quasi-legislative powers issuance is properly determined. As in the enactment of laws, the
since there is no determination of past events or facts that have to general rule is that, the promulgation of administrative issuances
be established or ascertained. requires previous notice and hearing, the only exception being
where the legislature itself requires it and mandates that the
Exception regulation shall be based on certain facts as determined at an
The exercise by the administrative body of its quasi- appropriate investigation. This exception pertains to the issuance
legislative power through the promulgation of regulations of of legislative rules as distinguished from interpretative
general application does not, as a rule, require notice and hearing. rules which give no real consequence more than what the law itself
The only exception being where the legislature itself requires it and has already prescribed; and are designed merely to provide
mandates that the regulation shall be based on certain facts as guidelines to the law which the administrative agency is in charge
determined at an appropriate investigation [Alliance v. Garin]. of enforcing. A legislative rule, on the other hand, is in the nature
of subordinate legislation, crafted to implement a primary
legislation [Executive Secretary v. South Wing].
In Commissioner of Internal Revenue v. Court of
Appeals, and Commissioner of Internal Revenue v. Michel J.
Lhuillier Pawnshop, Inc., the Court enunciated the doctrine that
when an administrative rule goes beyond merely providing for the
means that can facilitate or render less cumbersome the
implementation of the law and substantially increases the burden of
those governed, it behooves the agency to accord at least to those
directly affected a chance to be heard and, thereafter, to be duly
informed, before the issuance is given the force and effect of law.

Executive Secretary v. South Wing

Held: In the instant case, EO 156 is obviously a legislative rule
as it seeks to implement or execute primary legislative enactments intended
It should be understandable that when an administrative to protect the domestic industry by imposing a ban on the importation of a
rule is merely interpretative in nature, its applicability needs specified product not previously subject to such prohibition. The due
nothing further than its bare issuance for it gives no real process requirements in the issuance thereof are embodied in Section
consequence more than what the law itself has already 401[28] of the Tariff and Customs Code and Sections 5 and 9 of the
SMA[ which essentially mandate the conduct of investigation and public
prescribed. When, upon the other hand, the administrative rule
hearings before the regulatory measure or importation ban may be issued.
goes beyond merely providing for the means that can facilitate or In the present case, respondents neither questioned before this
render least cumbersome the implementation of the law Court nor with the courts below the procedure that paved the way for the
but substantially adds to or increases the burden of those issuance of EO 156. What they challenged in their petitions before the trial
governed, it behooves the agency to accord at least to those court was the absence of “substantive due process” in the issuance of the
directly affected a chance to be heard, and thereafter to be duly EO. Their main contention before the court a quo is that the importation
informed, before that new issuance is given the force and effect of ban is illogical and unfair because it unreasonably drives them out of
law [GMA v. COMELEC]. business to the prejudice of the national economy.
Considering the settled principle that in the absence of strong
evidence to the contrary, acts of the other branches of the government are
G. REQUISITES FOR VALIDITY presumed to be valid, and there being no objection from the respondents as
To be valid, an administrative issuance must comply with to the procedure in the promulgation of EO 156, the presumption is that
the following requisites: said executive issuance duly complied with the procedures and limitations
(1) Its promulgation must be authorized by the imposed by law.
legislature;
(2) It must be promulgated in accordance with the Where Rules Apply to Named or Specified Parties
prescribed procedure; Where such rules and/or rates apply exclusively to a
particular party and are predicated upon a finding of fact, which

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fact is denied by said party, the agency making such finding of fact, amplify is with the COMELEC. Nobody can encroach in our right to
performs a function partaking a quasi-judicial character, the valid amplify. Now, if in 2010 the Commission felt that per station or per
exercise of which demands a previous notice and hearing to satisfy network is the rule then that is the prerogative of the Commission then they
the requirement of due process [De Leon]. could amplify it to expand it. If the current Commission feels that 120 is
enough for the particular medium like TV and 180 for radio, that is our
prerogative. How can you encroach and what is unconstitutional about it?”
3. Within the Scope of Authority Given by the As we held in Lokin, Jr. v. Commission on Elections:
Legislature The COMELEC, despite its role as the implementing arm of the
To be valid, an administrative issuance must not be ultra Government in the enforcement and administration of all laws and
vires or beyond the limits of the authority conferred. It must not regulations relative to the conduct of an election, has neither the authority
supplant or modify the Constitution, its enabling statute and other nor the license to expand, extend, or add anything to the law it seeks to
existing laws, for such is the sole function of the legislature which implement thereby. The IRRs the COMELEC issued for that purpose
the other branches of the government cannot usurp. As held in should always be in accord with the law to be implemented, and should not
override, supplant, or modify the law. It is basic that the IRRs should
United BF Homeowner’s Association v. BF Homes, Inc.:
remain consistent with the law they intend to carry out.
Indeed, administrative IRRs adopted by a particular department
The rule-making power of a public administrative of the Government under legislative authority must be in harmony with the
body is a delegated legislative power, which it may not use provisions of the law, and should be for the sole purpose of carrying the
either to abridge the authority given it by Congress or the law’s general provisions into effect. The law itself cannot be expanded by
Constitution or to enlarge its power beyond the scope intended. such IRRs, because an administrative agency cannot amend an act of
Constitutional and statutory provisions control what rules and Congress.
regulations may be promulgated by such a body, as well as with
respect to what fields are subject to regulation by it. It may not
make rules and regulations which are inconsistent with the Chairman and Executive Director v. Lim
provisions of the Constitution or a statute, particularly the Held: Were A.O. No. 00-05, Series of 2002; Resolution No. 03-
statute it is administering or which created it, or which are in 211; and the the Notice of Violation and Show Cause Order null and void
derogation of, or defeat, the purpose of a statute. for having been issued in excess of the PCSD's authority?
We answer the query in the negative.
In case of conflict between the statute and administrative R.A. No. No. 7611 has adopted the Strategic Environmental
issuances, the law must prevail. A statute is superior to an Plan (SEP) for Palawan consistent with the declared policy of the State to
protect, develop, and conserve its natural resources. The SEP is a
administrative directive and the former cannot be repealed nor
comprehensive framework for the sustainable development of Palawan to
amended by the latter [Cruz].
protect and enhance the Province's natural resources and endangered
environment.
Executive Secretary v. South Wing Towards this end, the PCSD was established as the
Held: In the instant case, the subject matter of the laws administrative machinery for the SEP's implementation. The creation of the
authorizing the President to regulate or forbid importation of used motor PCSD has been set forth in Section 16 of R.A. No. 7611, to wit:
vehicles, is the domestic industry. EO 156, however, exceeded the scope SEC. 16. Palawan Council for Sustainable Development. - The
of its application by extending the prohibition on the importation of used governance, implementation and policy direction of the Strategic
cars to the Freeport, which RA 7227, considers to some extent, a foreign Environmental Plan shall be exercised by the herein created Palawan
territory. The domestic industry which the EO seeks to protect is actually Council for Sustainable Development (PCSD), hereinafter referred to as the
the “customs territory” which is defined under the Rules and Regulations Council, which shall be under the Office of the President. x x x
Implementing RA 7227, as follows: The functions of the PCSD are specifically enumerated in
“the portion of the Philippines outside the Subic Bay Section 19 of R.A. No. 7611, which relevantly provides:
Freeport where the Tariff and Customs Code of the Philippines and SEC. 19. Powers and Functions. - In order to successfully
other national tariff and customs laws are in force and effect.” implement the provisions of this Act, the Council is hereby vested with the
The proscription in the importation of used motor vehicles following powers and functions:
should be operative only outside the Freeport and the inclusion of said zone 1. Formulate plans and policies as may be necessary to
within the ambit of the prohibition is an invalid modification of RA 7227. carry out the provisions of this Act;
Indeed, when the application of an administrative issuance modifies 2. Coordinate with the local governments to ensure that
existing laws or exceeds the intended scope, as in the instant case, the the latter's plans, programs and projects are aligned with the plans,
issuance becomes void, not only for being ultra vires, but also for being programs and policies of the SEP;
unreasonable. 3. Call on any department, bureau, office, agency or
instrumentality of the Government, and on private entities and
organizations for cooperation and assistance m the performance of its
GMA v. COMELEC
functions;
Held: There is no question that the COMELEC is the office
4. Arrange, negotiate for, and accept donations, grants,
constitutionally and statutorily authorized to enforce election laws but it
gifts, loans, and other funding from domestic and foreign sources to carry
cannot exercise its powers without limitations – or reasonable basis. It
out the activities and purposes of the SEP;
could not simply adopt measures or regulations just because it feels that it is
5. Recommend to the Congress of the Philippines such
the right thing to do, in so far as it might be concerned. It does have
matters that may require legislation in support of the objectives of the SEP;
discretion, but such discretion is something that must be exercised within
6. Delegate any or all of its powers and functions to its
the bounds and intent of the law. The COMELEC is not free to simply
support staffs, as hereinafter provided, except those which by provisions of
change the rules especially if it has consistently interpreted a legal
law cannot be delegated;
provision in a particular manner in the past. If ever it has to change the
7. Establish policies and guidelines for employment on
rules, the same must be properly explained with sufficient basis.
the basis of merit, technical competence and moral character and prescribe
Based on the transcripts of the hearing conducted by the
a compensation and staffing pattern;
COMELEC after it had already promulgated the Resolution, the respondent
8. Adopt, amend and rescind such rules and regulations
did not fully explain or justify the change in computing the airtime allowed
and impose penalties therefor for the effective implementation of the SEP
candidates and political parties, except to make reference to the need to
and the other provisions of this Act;
“level the playing field.” If the “per station” basis was deemed enough to
9. Enforce the provisions of this Act and other existing
comply with that objective in the past, why should it now be suddenly
laws, rules and regulations similar to or complementary with this Act;
inadequate? And, the short answer to that from the respondent, in a manner
10. Perform related functions which shall promote the
which smacks of overbearing exercise of discretion, is that it is within the
development, conservation, management, protection, and utilization of the
discretion of the COMELEC. As quoted in the transcript, “the right to
natural resources of Palawan; and

Page 13 of 16
 11. Perform such other powers and functions as may be a. Interpretative regulations
necessary in carrying out its functions, powers, and the provisions of this b. Those merely internal in nature, that is, regulating only
Act. (Emphasis supplied) the personnel of the administrative agency and not the
Accordingly, the PCSD had the explicit authority to fill in the public
details as to how to carry out the objectives of R.A. No. 7611 in protecting
c. Letters of instruction issued by administrative superiors
and enhancing Palawan's natural resources consistent with the SEP. In that
task, the PCSD could establish a methodology for the effective
relative to guidelines to be followed by their
implementation of the SEP. Moreover, the PCSD was expressly given the subordinates in the performance of their duties
authority to impose penalties and sanctions in relation to the [Villafuerte v. Cordial].
implementation of the SEP and the other provisions of R.A. No. 7611. As
such, the PCSD's issuance of A.O. No. 00-95 and Resolution No. 03-211 1. Formal Requirements on Promulgation
was well within its statutory authority. The following are the pertinent provisions under Book
VII, Chapter 2 of E.O. 292:
4. Must be Reasonable
It is an axiom in administrative law that administrative SECTION 3. Filing.—(1) Every agency shall file
authorities should not act arbitrarily and capriciously in the with the University of the Philippines Law Center three (3)
issuance of rules and regulations. To be valid, such rules and certified copies of every rule adopted by it. Rules in force on the
regulations must be reasonable and fairly adapted to secure the end date of effectivity of this Code which are not filed within three
(3) months from that date shall not thereafter be the basis of any
in view. If shown to bear no reasonable relation to the purposes for
sanction against any party or persons.
which they were authorized to be issued, then they were authorized (2) The records officer of the agency, or his
to be issued, then they must be held to be invalid [Executive equivalent functionary, shall carry out the requirements of this
Secretary v. Southwing]. section under pain of disciplinary action.
Lupuangco v. Court of Appeals is a case involving a (3) A permanent register of all rules shall be kept by
resolution issued by the Professional regulation Commission which the issuing agency and shall be open to public inspection.
prohibited examinees from attending review classes and receiving SECTION 4. Effectivity.—In addition to other rule-
handout materials, tips, and the like three days before the date of making requirements provided by law not inconsistent with this
Book, each rule shall become effective fifteen (15) days from
examination in order to preserve the integrity and purity of the
the date of filing as above provided unless a different date is
licensure examinations in accountancy. Besides being unreasonable fixed by law, or specified in the rule in cases of imminent
on its face and violative of academic freedom, the measure was danger to public health, safety and welfare, the existence of
found to be more sweeping than what was necessary. which must be expressed in a statement accompanying the rule.
The agency shall take appropriate measures to make emergency
Executive Secretary v. South Wing rules known to persons who may be affected by them.
Held: There is no doubt that the issuance of the ban to protect SECTION 8. Judicial Notice.—The court shall take
the domestic industry is a reasonable exercise of police power. The judicial notice of the certified copy of each rule duly filed or as
deterioration of the local motor manufacturing firms due to the influx of published in the bulletin or the codified rules.
imported used motor vehicles is an urgent national concern that needs to be SECTION 9. Public Participation.—(1) If not
swiftly addressed by the President. In the exercise of delegated police otherwise required by law, an agency shall, as far as practicable,
power, the executive can therefore validly proscribe the importation of publish or circulate notices of proposed rules and afford
these vehicles. Thus, in Taxicab Operators of Metro Manila, Inc. v. Board interested parties the opportunity to submit their views prior to
of Transportation, the Court held that a regulation phasing out taxi cabs the adoption of any rule.
more than six years old is a valid exercise of police power. The regulation (2) In the fixing of rates, no rule or final order shall
was sustained as reasonable holding that the purpose thereof was to be valid unless the proposed rates shall have been published in a
promote the convenience and comfort and protect the safety of the newspaper of general circulation at least two (2) weeks before
passengers. the first hearing thereon.
The problem, however, lies with respect to the application of the (3) In case of opposition, the rules on contested cases
importation ban to the Freeport. The Court finds no logic in the all shall be observed.
encompassing application of the assailed provision to the Freeport which is
outside the customs territory. As long as the used motor vehicles do not Administrative issuances which are not published or filed
enter the customs territory, the injury or harm sought to be prevented or with the National Administrative Register as required under E.O.
remedied will not arise. The application of the law should be consistent 292 are ineffective and may not be enforced [Cruz].
with the purpose of and reason for the law. Ratione cessat lex, et cessat
lex. When the reason for the law ceases, the law ceases. It is not the letter Publication + Registration/Filing
alone but the spirit of the law also that gives it life. To apply the
It bears stressing that, even if the administrative rule
proscription to the Freeport would not serve the purpose of the EO. Instead
of improving the general economy of the country, the application of the were duly registered or filed with the ONAR, it would still be
importation ban in the Freeport would subvert the avowed purpose of RA unenforceable or may not be implemented unless it can be
7227 which is to create a market that would draw investors and ultimately established that it was likewise duly published in the Official
boost the national economy. Gazette or in a newspaper of general circulation [Cruz].
In National Association of Electricity Consumers for
F. PUBLICATION REQUIREMENT Reforms v. Energy Regulatory Board, it was emphasized that both
As a general rule, publication is indispensable in order the requirements of publication and filing of administrative
that all statutes, including administrative rules that are intended to issuances intended to enforce existing laws are mandatory for the
enforce or implement existing laws, attain binding force and effect effectivity of said issuances.
[Villanueva v. Judicial and Bar Council]. In Republic v. Pilipinas Shell, it was held that the
The publication requirement on laws accomplishes the requirements of publication and filing must be strictly complied
constitutional mandate of due process. That omission of with, as these were designed to safeguard against abuses on the part
publication of laws is tantamount to denying the public of of the lawmakers and to guarantee the constitutional right to due
knowledge and information of the laws that govern it; hence a process and to information on matters of public concern [MPSTA
violation of due process [Villafuerte v. Cordial]. v. Garcia].
The following are the exceptions:
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 2. Bodies not Covered revise, alter, or repeal the same. This is to allow the administrative
The publication requirement in the ONAR is confined to agencies flexibility in formulating and adjusting the details and
issuances to issuances of administrative agencies under the manner by which they are to implement the provisions of a law, in
Executive Branch of the Government [Ocampo v. Enriquez]. order to make it more responsive to the times [Cruz].
The following are not covered by the filing requirement:
a. Congress, J. ENFORCEMENT
b. The Judiciary, It is established that the power to promulgate
c. The Constitutional Commissions, administrative regulations carries with it the implied power to
d. The Board of Pardons and Parole, and enforce them. In most cases, it is the statute creating the
e. State Universities and Colleges. administrative body that will provide for the means by which the
administrative regulations will be enforced although, as previously
The Guidelines for Receiving and Publication of Rules and observed, the usual judicial actions may be available [Cruz].
Regulations Filed with the UP Law Center The power to enforce regulations likewise includes the
9. Rules and Regulations which need not be filed with the U.P. power to issue opinions and rulings to enable the administrative
Law Center, shall, among others, include but not limited to, the following: agency to properly execute said regulations [Cruz].
a) Those which are interpretative regulations and those merely
internal in nature, that is: regulating only the personnel of the K. LEGISLATIVE VETO
Administrative agency and not the public;
A legislative veto is a statutory provision requiring the
b) instructions on the case studies made in petitions for
adoption;
President or an administrative agency to present the proposed
c) Rules laid down by the head of a government agency on the implementing rules and regulations of a law to Congress which, by
assignments or workload of his personnel or the wearing of uniforms; itself or through a committee formed by it, retains a “right” or
d) Rules and regulations affecting only a particular or specific “power” to approve or disapprove such regulations, before they
sector and circularized to them; take effect [ABAKADA v. Purisima].
e) Instructions by administrative supervisors concerning the
rules and guidelines to be followed by their subordinates in the performance
of their duties;
f) Memoranda or statements concerning the internal
administration or management of an agency not affecting the rights of, or
procedure available to, the public;
g) Memoranda or circulars merely disseminating any law,
executive order, proclamation, and issuances of other government agencies.

Administrative Rules with Penal Sanctions

Additional rules are:
(a) The law must itself declare as punishable the
violation of the administrative rule or regulation. See People v.
Maceren, 79 SCRA 450.
(b) The law should define or fix the penalty for the
violation of the administrative rule or regulation.

G. EFFECT OF RELIANCE ON RULES

A person who relies in good faith on an agency rule
should be held harmless from loss if that rule is later held invalid or
is amended.

H. RETROACTIVE OPERATION
Whether the rules, regulations, or rulings of an
administrative agency operate or can be made to operate
retroactively depends on the provisions of the authorizing statutes
[De Leon].

I. AMENDMENT OR REPEAL OF ADMINISTRATIVE

RULES AND REGULATIONS
Like the statute, the administrative regulation made
thereunder is subject to amendment or repeal by the authorities that
promulgated them in the first place. Hence, it is a standard
provision in the administrative rules that prior issuances of
administrative issuances of administrative agencies that are
inconsistent therewith are declared repealed or modified [Cruz].
As for the administrative body itself, its power to issue
regulations is not, once exercised deemed exhausted. On the
contrary, this power may be exercised as often as it becomes
necessary to adjust the regulation to changing circumstances
surrounding the subject thereof or the problem sought to be solved
or alleviated by the rule [Cruz].
At any rate, it has been ruled that an express grant of
rule-making power necessarily includes the power to amend,

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