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OSMEÑA vs. ORBOS

OSMEÑA vs. ORBOS

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Published by Danniel Ancheta
G.R. No. 99886 March 31, 1993
Philippine Political Law
G.R. No. 99886 March 31, 1993
Philippine Political Law

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Published by: Danniel Ancheta on Nov 05, 2009
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01/13/2013

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OSMEÑA vs. ORBOSG.R. No. 99886 March 31, 1993FACTS
P.D. 1956 creating a Special Account in the General Fund, designated as the OilPrice Stabilization Fund (OPSF). The OPSF was designed to reimburse oil companies for cost increases in crude oil and imported petroleum products resulting from exchange rateadjustments and from increases in the world market prices of crude oil.Subsequently, the OPSF was reclassified into a "trust liability account," in virtueof E.O. 1024,
7
and ordered released from the National Treasury to the Ministry of Energy. The same Executive Order also authorized the investment of the fund ingovernment securities, with the earnings from such placements accruing to the fund.President Corazon C. Aquino, amended P.D. 1956. She promulgated ExecutiveOrder No. 137 on February 27, 1987, expanding the grounds for reimbursement to oilcompanies for possible
cost underrecovery
incurred as a result of the reduction of domestic prices of petroleum products, the amount of the underrecovery being left for determination by the Ministry of Finance.The petition further avers that the creation of the trust fund violates §29(3), Article VI of the Constitution. The petitioner argues that "the monies collected pursuant to . . P.D. 1956, as amended, must be treated as a 'SPECIAL FUND,' not as a'trust account' or a 'trust fund,' and that "if a special tax is collected for a specific purpose,the revenue generated therefrom shall 'be treated as a special fund' to be used only for the purpose indicated, and not channeled to another government objective."
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Petitioner further points out that since "a 'special fund' consists of monies collected through thetaxing power of a State,
 such amounts belong to the State
, although the use thereof islimited to the special purpose/objective for which it was created."
RULING
While the funds collected may be referred to as taxes, they are exacted in theexercise of the police power of the State. Moreover, that the OPSF is a special fund is plain from the special treatment given it by E.O. 137. It is segregated from the generalfund; and while it is placed in what the law refers to as a "trust liability account," the fundnonetheless remains subject to the scrutiny and review of the COA. The Court is satisfiedthat these measures comply with the constitutional description of a "special fund."Indeed, the practice is not without precedent.With regard to the alleged
undue delegation of legislative power 
, the Court findsthat the provision conferring the authority upon the ERB to impose additional amounts on petroleum products provides a sufficient standard by which the authority must beexercised. In addition to the general policy of the law to protect the local consumer by

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