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Main Topic: The Incorporation Clause
Lao Ichong is a Chinese businessman who entered the country to take advantage of
business opportunities herein abound (then) – particularly in the retail business. For some
time he and his fellow Chinese businessmen enjoyed a “monopoly” in the local market in
Pasay. Until in June 1954 when Congress passed the RA 1180 or the Retail Trade
Nationalization Act*.
Plaintiff: LAO ICHONG – in his own behalf and in behalf of other alien
residents/corp./partnership affected
(1) it denies to alien residents the equal protection of the laws and deprives of their
liberty and property without due process of law
(2) the subject of the Act is not expressed or comprehended in the title thereof;
(3) the Act violates international and treaty obligations of the Republic of the Philippines
(Charter of the United Nations and the Declaration of the Human Rights adopted by the
UN General Assembly; Treaty of Amity between Republic of the Philippines and Republic of
(4) the provisions of the Act against the transmission by aliens of their retail business thru
hereditary succession
Defendant: JAIME HERNANDEZ, Secretary of Finance ; MARCELINO SARMIENTO, Manila
City Treasurer
(1) the Act was passed in the valid exercise of the police power of the State, which
exercise is authorized in the Constitution in the interest of national economic survival;
(2) the Act has only one subject embraced in the title;
(3) no treaty or international obligations are infringed;
(4) as regards hereditary succession, only the form is affected but the value of the
property is not impaired, and the institution of inheritance is only of statutory origin.
Issue: Whether or not the Act violates international and treaty obligations of the Republic
of the Philippines?
Ruling: (focused on the topic at hand-incorporation clause)
Petition denied. The United Nations Charter imposes no strict or legal obligations
regarding the rights and freedom of their subjects and the Declaration of Human Rights
contains nothing more than a mere recommendation, or a common standard of
achievement for all peoples and nations. The Treaty of Amity between China and the
Philippines guarantees is equality of treatment to the Chinese nationals "upon the same
terms as the nationals of any other country." But the nationals of China are not
discriminating against because nationals of all other countries, except those of the United
States, who are granted special rights by the Constitution, are all prohibited from engaging
in the retail trade. But even supposing that the law infringes upon the said treaty, the

Citizens and juridical entities of the United States were exempted from this Act. until their death or voluntary retirement. unless their licenses are forfeited in accordance with law. partnerships.  a prohibition against aliens and against associations. or corporations the capital of which are not wholly owned by Filipinos. from engaging directly or indirectly in the retail trade  aliens actually engaged in the retail business on May 15.A. ten years after the approval of the Act or until the expiration of term. 1954 are allowed to continue their business.treaty is always subject to qualification or amendment by a subsequent law it cannot be said to be void for supposed conflict with treaty obligations because no treaty has actually been entered into on the subject and the police power may not be curtailed or surrendered by any treaty or any other conventional agreement. * R. from having a stranglehold upon the people’s economic life. 1180 (An Act to Regulate the Retail Business). Its purpose was to prevent persons who are not citizens of the Phil. In case of juridical persons. .