Tabiigan - 2

(PO - Deputy Speaker Abueg)

August 17,1995

3:10 PM

RESUMPTION OF SESSION

At 5.'13 p.m., the session was resumed.

THE DEPUTY SPEAKER (Rep Abueg). The session is resumed.

REP. PARAS. Mr. Speaker.

THE DEPUTY SPEAKER (Rep. Abueg). The distinguished Gentleman

from Negros Oriental.

REP. PARAS. In view of my earlier statement, and also in view of the

speech about to be delivered and considering that it is of consequence to the

House, I would therefore waive my earlier manifestation or I would withdraw my

earlier manifestation.

THE DEPUTY SPEAKER (Rep Abueg). The motion is withdrawn.

REP. ARROYO. Mr. Speaker.

THE DEPUTY SPEAKER (Rep Abueg). The distinguished Gentleman

from the First District of Makati.

QUESTION OF PRIVILEGE OF REP. ARROYO

REP. ARROYO. I rise on a question of collective privilege on a

constitutional issue that affects the integrity of the House and it is very ripe to

continue existing.

In the course of the fight for the speakorship, Rep. Agapito Aquino, chairman of the reform bloc, raised questions regarding the fitness of Rep."J-LJ-v·.\

2

u

Tabligan - 2

(PO - Deputy Speaker Abueg)

August 17, 1998

5:10 PM

Villar to seek the' speakershlp, Rep. Villar chose not to answer the charges but h" W<JS overwhelmingly elected, . .! W

3

----_.- .. _----,------ -+-------------.-----~----- "--, -----------

DOMINGO -2

August 17,1998

5:15p.m.

(P.O. - DEPUTY SPE/\KER ABUEG)

REP. ARROYO .... he was overwhelmingly elected Speaker by this

House.

Successful election, however, does not answer the questions nor lay to rest charges of wrongdoing, not in a government of laws.

We had a colleague, we still have a colleague in the person of Congressman Jalosjos. He was elected by his district but that did not erase his conviction. So, drawing <I parallel election does not wipe out the offense.

The questioris raised, nay, the charges against Speaker Villar are constitutional in character. And our duty as members of the legislature is peremptory and clear. We took an oath to support and defend the Constitution and uphold the laws. The Constitution has been violated, laws have been broken. If we are to continue in the capacity of public officials, if this Chamber is to continue in its very character as legislature, an indispensable pillar in the system of checks and balances, then we must come to the Constitution's defense and the vindication of the laws.

I hesitated long and pondered hard whether to raise these

questions for fear of being accused of sour-qrapinq and being a poor sport. But this has nothing to do with sports. Our duty is clear, there are charges of illegalities, the charges must be heard and answered. I am reminded of the case of Speaker Newt Gingrich of .the United States House of Representatives. He was investigated by the United States House of

DOMINGO -2

August '17, 1998

5:15p.m.

Representatives for I think collecting some fees of books he wrote while

Speaker (I am not too sure of the facts). But one thing I am sure of is this,

the House after hearing censured its own Speaker and penalized him with

a penalty of I think US$300,OOO. He remained as Speaker but the penalty

was meted out. In other words, there are precedents and we must not

hesitate to do our duty.

Article XI of the Constitution is titled "Accountability of Public

Officers" it proscribes in Section 16 that:

"No loan, guaranty, or other form of financial accommodation for any

business purpose may be granted, directly or indirectly, by any government

or controlled bank or financial institution to the President, the Vice

President, the Members of the Cabinet, the Congress, the Supreme Court,

and the Constitufional Commission, the Ombudsman, or to any firm or

entity in which they have controlling interest, during their term."

Charge I. Low cost housing is totally dependent on government

agencies suer', as PAG-IBIG, National Home Mortgage Finance Corporation

(NHMFC), SS S, GSIS, and other government financial institutions,

Speaker Villar and the companies of which he is President or

Chairman, or where he has a controlling interest, are the biggest low-cost

housing developers in the country, To be more specific, it is the Camella

and Palmera Homes and its principal subsidiaries, the Household

Development Corporation and Palmera and Communities Philippines,

2

DOMINGO ·2

August 17,1998

5:15p.m.

In violation of the constitutional injunction, these companies were given financial accommodations by government banks or financial institutions, among them, PAG-IBIG and the National Home Mortgage Finance Corporation among others, during Speaker Villar's term as Representative from 1992 to 1998 to finance their business purposes.

Charge II. Representative Villar, from 1992 to 1998 did not divest himself of his interests in, nor did he sever his connections with, the companies aforestated. They obtained financial accommodations ... mvd

3

2

Tne v ~.")bt,e_-;'.ne-d tin,':\ncia"i ;~cc:clrnmnd,;:~t.ic,n.:.:

Since he did no~. tl1erefore. sDch

1 .... ~omp·3.11 te e r;/J8re fo:r·bic1d!?n troll"'] enter 1ng into eueh f--=i.n8~nc i ·,il

·Because of our Constitut.ion .. RepubJtc Act No . 67L3

knCl\Nl"'. as th·e· ..... Code of Conduct and Eth_LCB.l Standards for

Public Officials"

states in Section 9:

" Divestment.

A publ.ic o f f ic i a L or employee shc,uJ.d

avoid conflicts of interest at all times.

vlben a co~~f.l iet.

[~r·j."rate bUBines8 ~nterpri5e within thirty (30) days from his

Ctc;3UmI)t ion

of

office

a.nd/or

divest

h unee.l f

of

a~-3eurnpt.iC\n _ ' ....

Charge Ill.

Nor ha~ Speaker Villar, up to now~

a.nl

s"aY'ing Uri t.o now .. d Lve st srd himee l f of h ie interests .iu . f:or

he

h ie

connect.ions

with.

the

c:omr'i'lDJ.t?S

Spe~ker Vii.lar' is Ln no tlurrv to div~6t

beC3:use h0;~ :has dec lared that. rfe i. s under no td:<t tga.t ion r c! do

80_ A continuing violation.

Speaker Villar cO}ltrois the Capito_L B~nk.

V t Llar- is the chief 8~·:8c:utt·ve o ff i c e r .

Be.j1.!-:- r-e c e i v e d Los rie , t i.nanc tsI ac c ommode.t.i.ons arid gu,=:\I"~"3nt(:::!e3

from tIle Bangj~o Sentral fIg f'ilif1lnas froDl 1882 to

0::;0·18

Pa.ge 1

l\uguEt,.\..7 J,:"JC-.i!.3

is

cor;.2,-r.it:.l.li.i.();: ...... ~.11 OJ

:r i..dd8n.

if a Rep~eGen·t~ative hnsa contrall~ng j.ntere£~ ~ri ~

lo . .::tn" a gu.ararlt.y.., or- a financial a,:;comrnodat.ion for l~trQl

b~jsj ness purpose f r-om Ci.ny g'ov(::rnment f inar.c j .• 3.1 insti tut ion.

If that firm or- e,nt.i t.v wou Ld like to ''Jbtain a Lo e.n. a

gl,J.':~lri~~nty 01"' a financial accommodation f rom a. flov'~rnmE-'nt

fil~ancial institution.

t.hat, firm 01' e n t.a ty .nue+. fj.l"'st

relieve

of

the

itself

of

thE:>

controlling

interest

It it::; lI':V hV.mble ~31.1brnission t.ha t Spe,s.ker Villar d i.d [!')T ...

HI-3publ ic Act No. ·301S ~ o t.ne rw i se known ,"-1:7: t,ile [~r!ti"-

t~lereof as follows:

c u~

Proh.ibition on rlemberr:-; of' Congress.

tl~ rAce iVA any personal or pecuniary interest ir~ any

2pe,::;lfj.c busj.ness enterprise which will be dlrsc:·tly and

,par·t",icu1.arl,y fa--=,ror'ed or 1::e.nefit.ed bV any J..e..T..'l or r e e.o ~lJt.ion

It.

"i~.} .... ;:::. en'3.C'tment, ~'r aci(="1?t,ioJ .... of ?'~':l Law nr 'l·er:.~c.luticn~

·;:'.I.i.r.l:,;,'C. it h.. r}id '3.5J.-; 01'" ir.i.:i_ :"~_B,t_,t:: she en:~',-:'''''.mRnt. 01 ;~:"....~"

Simply put, during our term of office. Bftch one of us.

Uv"-,, would benefit or favor

r8:'301111:.10n \

The above p)cohihiti.on 3hall

to that. represent~.ti v e who ,just rec'Jmmended. not:

au~hor any

law or

it shall be unla~ful for us to

,",van authn.l'sd. the enactment of such law that benefite6 L:'m.'

Hepresantat.ive Villar. in his b i.d fa:' tile

2peakership, prepared a propaganda kit that he distributed

to Congre:=:E,nlel1 and media.

1 think y~u were given copies of

rhs t. nne.

It is entitled.. "'l"lanny B. Villar, ']1' .. Ach i eve r

Vtsionary

Le e.de r , --

and

[inJ

the

.... Leg:t81.::n:iv~

P8'!"'formance

of

Corrgr-e e srnan

Manny

B.

Villar.

.j r. ~ ~

Hepret38ntative

Villar

une quL vocall y

said

that.

'. .inc o r-po r-a t.e d in the landmark Comprehensive 6nd Ln te g ra t ed

Shelter

Finance

Act.

Act

No~

71:3·35.

rR~apitaljzDtiQn of the National

/C:L,~

Ansula - 2

Aug. 17, 1998

5:25 p.m.

(pO - REP. ABUEG)

REP. ARROYO. . .. the recapitalization of the National Home Mortgage

and Finance ccrperation and ths amenclm anI 10 the Agri-AGua Law \0 include

hOL!sl!1g Investment. "

Speaker Villar's companies are engaged in housing. He ihlH\3by violated the Anii-Graft Law.

'The aforementioned Act, which incorporates H.B. No. 6145, coauthored by then Representative Villar mandates "banks to extend to housing loans not utilized for agriculture and agrarlel1 reform credi!." in other words, loanable funds for agricul1uTe and agrarian credit a(8 to be rs-cnanneled 10 housing, Speaker VlIfar's business.

Representative Villar co-authored H.B. No. 11005 which "increased the capital of the National Home Mortgi~ge and Finance Corporation" and Is Ihe main

source of funding of Spa(fkar ViUar1s companies. President Estrada admitted that

the National HOIU(.l Mortgage and Finance Corporation is presilntiy bankrupt. He said that to the following: LA'MP President Edgardo Angara, ccncressman Agapito Aquiiio, Presidential Lef/islative Liaison Officer Jimmy Pollcarpio, former

bankrupt.

increasing the capltatzation of a bankrupt GFI benefited

Representative Vlilar's housing eompantee.

In the same propaganda kit of Speaker Villar, it states that "also passed by the House were Villar's ·measures to make Pag-ibig Fund contributions

Ansula - 2

Aug. 17, ;998

5:25 p.m.

compulsory and 10 Increase housing investments wHh the SSS." Pag-ibig is a

main source-of funding of Speaker Villar's companies.

in a word, RepreS8niatlV8 Viifar'g legislation from 1992 10 1998 were

designed to benent hi:> business, a violation orlM Anti-Graft Law.

Now, the same provision of the Antl-Graft and Corrupt Practices Act,

provides in the third paragraph of Section 6 thereof, as follows:

It shall likewise be unlawful for such member of Congress or

other public officer, who, having such interest prior to the approv-al of

such law or reeojuuen authored or recommended by him, continues

for thirty days after such approval to retain such interest.

Charge VII. When those bills that Representative Villar introduced or

coauthored wsre enacted into law, he did not divest himself or his interests in his

companies that UJenefited therefrom.

Now, Republic .Act 67i3, known as the Code of Conduct and Ethical

staneares ror Puolle Oiiiciais provides in ssenon 3 (I):

Section 3 (j) "Divestment" is the transfer of tltle or disposal of

intem~:t in property by voluntarily, completely and actually deprrving

or dispossessing oneself of his right or title to itin favor of a parson or pars O!iS othsr thsn his SpOUS!I and relatiVes as defined in this Act.

Charge' VIII. Manuela Corporation applied for and was granted a loan of P1 billion by tine SSG, a government financial instilution. Another P2 billion loan

would be syndicatad with another govarnmanf financial ins"tituHon: the GSIS. Total

syndicated loan from the two OFls: P3 billion. ~

Q}:'{i50

Ansula - 2

Aug. if, 1998

5:25 p.m.

Manuela Corporation, a housing and realty corporation, is owned by the family of the wife of Speaker Villar. An indirect financial accommodation. Again, the same Code of Condu2t and Ethical Standards for Public Officials states in Section 3 (k) thereof:

Section 3 (k) "Relatives" refers to any and all persons related to a public official or employee within ine .four!h civil degree of

consanguinity or affinity, including biles. inso or balae.

SSS. historically and as a mailer of public policy does not extend direct loans to any company. II extends loans to banks or to public or prNate financial institutions but not directly to business enterprises. The direct loan to Manuela Corporation is a firsi in SSS history,

Bongn1to -2

August 17, 1998

.5:.JO p.rn.

(PO- Deputy Spaakor Abu ng]

REP. ARROYO. .v.in SSS hietory.

Charge IX. Manuela Corporation owes tile Capitol Bank, which is

also owned by Speaker Villar, P 150 million. There may he nothing wrong

with that because both ar.e private entities. However. out of the P3

billion loan to be syndicated by ·the SSS and GSIS, P150 million was

earmarked to liquidate the P 150 n:illion Capitol Ba11k: loan to the failing

Manuela Corporation. In other words, it is a financial accommodation

extended by GFls to relieve Capitol Bank, owned by Speaker Villar, of the

P 150 million loan .: Another, indirect financial accommodation.

Charge X. The Comprehensive Agrarian Reform Program (CARP) is

being undertaken in obedience to a constitutional mandate. All lands.

covered by CARP cannot be used for residential, agricultural, industrial

01' other uses unless a clearance, conversion, or exemption for a

particular property is first issued by DAR.

Speaker Villar's companies are developing or have developed 5,950

hectares or almost 60,000.000 square. meters of CARP lands into

residential subdivisions 'without the. appropriate DAR issuances that

wcu ld authoriao such Iands to .be used for residential purposes; A

traducement of the constitutionally directed CARP law.

Article XIII of the Constitution, in Sections 4, 5, 6, 7 and 8 states

with clarity what the agrarian 'reform program is all about.

( ~ !

Bonguito -2

August 17, 1998

JU8t to give you an idea about how big 60,000,000 square ureters

is -- my constituency of Makaii is only one-third of that size. It is only

roughly 21,000,000 square meters. Las Pinas which is the constituency

of Speaker Villar is roughly 41,000,000 square meters. If you add the

entire area of Las Pinas and Makati, that is the residential subdivisions

covered by the companies of Speaker Villar.

The House can n ot reform itself, much less even operate effectively

if fl cloud of doubt hangs over the Speaker of the House. It is to the interest of the Speaker and the Members no less'if these concerns are

addressed frontally and' resolved forthwith to clear the path for

meaningful reforms.

Public office is, a public trust. We, the representatives of the people

pay a price for' getting elected to public office. The Constitution imposes

on us certain constraints which we must follow to the letter,

Let me allude to the Members of Congress who' are barristers --

the Constitution forbids lis, lawyers, from appeering in court. In my

case, for instcnce, I was' a practitioner up to 1992, I got elected to the

House so I stopped pr-acticing, or in other words, I no longer appear in

court. That is the price I have to pay. I Hunk I was earning adequately

in the practice of law, but I have to make a choice. Do I want to be a

lawyer, or I WCUJ.t to be a Congressman? If I want to continue being a

lawyer, then I must not be a Congressman.

If I have to be a'f' . // /

(LC,53 ,//

Bongulto -2

August 17, 1998

5:30 p.m .

says.

So in. the case of Speaker Villlar, it is simple. If 11-8 wants to

gol continue in business and deal with government financial institutions, he can do so but he cannot also be a Congressman. If he wants to be a Congressmru1., then he must not be in business which deals with the goverIllllent. We have to pay a price.

So, this case is a learning experience for us all. Whatever the outcome, it will show the things we can do, the things we cannot do, and

the things we must do.

I would propose ...

~---- ---- -- -------- -------------~----------------.

BRACIA-2

August 17,1998

535 p.m.

PO- The Deputy Speaker (Rep. Abueg)

REP ;\RROYO. I would propose that the House of Representatives

constitute itself into a Committee of the Whole to hear the charges and the Speaker's defense.

He will have a trial that is more than fair to him for he will be judged by the very peers who elevated him to be the first among equals, only this time they wUI judge him according to the law.

I will never seek the speakership again nor in any manner challenge the leadership of Speaker Villar except on this specific issue of constitutional breach that calls into question the rule of law.

This is how important it is. So I rest my cause. I am ready to be interpellated.

REP. BATERINA. Mr. Speaker.

THE DEPUTY SPEAKER (Rep. Abueg). What is the pleasure of the Gentleman from lIocos Sur?

REP. BATERINA. May I ask, may this Representation, request the

Centleman from the First District of Makati to please answer a few questions.

THE DEPUTY SPEAKER (Rep. Abueg). He may, if he so desires. REP. ARROYO. Gladly, Mr. Speaker.

THE DEPUTY SPEAKER (Rep. Abueg). The Gentleman from lIocos Sur may proceed with his interpellation.

BRACIA·2

August 17, 1998

5'35 p.m.

REP. B.ATERINA. Before proceeding, Mr. Speaker, may I also move that the time of the Gentleman from the First District of Makati be extended another

ten minutes.

THE DEPUTY SPEAKER (Rep. Abueg), Is there any objection? (Silence) No objection, motion is granted,

REP. BATERINA. Thank you, Mr. Speaker.

I would like to premise this request to ask several questions on the fact that at one time, Mr. Speaker, before the 14th of August, I was asked by some members of the media as to whether the speech that was circulated about by the Gentleman from Makati can hold water. And this is what I answered, and it is rightfully quoted in the media, Mr. Speaker, I said that Congressman Arroyo has not cited the cases by which the Speaker, Congressman Villar, should be charged of. In other words, I was saying that even the constitutional provision was not very clear as to how it can be violated and this is why I stand up today,' I would have stood up on a question of personal privilege had not the Gentleman from Makati stood up to deliver his speech which was already entered into the records. And I found in another item of The Star, either it was a press release or a column or a byline by Mr. Jess Diaz, and it says that apparently the Gentleman from the First District of Makati called people who made comments as to the charges he aired against the Speaker as people who answered for the Speaker as toadies. And the first thing that comes to my mind today is, did the Gentleman from Makati speak of the people who defended Speaker Villar as toadies?

2

B Ri\C 1/\-2

August 17,1998

5:35 p.rn.

REP. ARROYO. Mr. Speaker, yes, because I had not delivered my speech, ! have not uttered a word but many have said I have no proof. I have not even said a word and I have no proof, that I will be ousted if I cannot prove the charges 1 arn sourgraping. The speech says that sour qrapinq and sports has nothing to do with this. Now, imagine I am being pilloried as one who cannot prove my charges. I am offended by that ...

=- .

_.He n

I

CABAN OS - 2 August 17, 1998

PO - The Deputy Speaker (Rep. Abueg)

REP. ARROYO .... who cannot prove my charges. I am offended by that,

5:40 p.m.

Mr. Speaker, both as a Member of the House and as a barrister. Because, it would appear as if I am bluffing, and I don't bluff.

REP. BATERINA. But the Gentleman from Makati made a general and a very sweeping statement, and did not mention names, Mr. Speaker, and he just calls the people who made some comments, "toadies". Is that correct, Sir?

REP. ARROYO. Well if a person is not alluded to, why should he be hurt.

The only ones who will be hurt will be those who are alluded to.

REP. BATERINA. Because, there was a general statement ...

REP. ARROYO. But if the Congressman from lIocos Sur feels he was alluded to, I mean, it's no longer my fault.

REP. BATERINA. That is why I stood up and premised all these questions upon that fact of the statement from the Gentleman from Makati because he calls the people who made the comments on the speech of the Congressman from Makati and, thereafter, there was a general and a very sweeping statement that ali those who defended the Speaker are "toadies". I hope that We can clarify this, because I was speaking about the constitutional provision and I would like to go to that, Mr. Speaker.

Mr. Speaker, I would like to ask the Gentleman from Makati, whether there

was only one constitutional provision he cited in his speech, and that is Section 16 of Article XI, is that correct, Mr. Speaker?

CABANOS - 2

August 17, 1998

5:40 p.m.

PO - The Deputy Speaker (Rep. Abueg)

REP. ARROYO. Yes and there's another one, Section 12 of Article VI of the Constitution which I failed to mention. And also ... I think that's it, Mr. Speaker.

REP. BATERINA. But his main thesis, Mr. Speaker, is that the Speaker violated Section 16 of Article XI, that's the main premise.

REP. ARROYO. Yes.

REP. BATERINA. And in the interview, the ambush interview that I gave, Mr. Speaker, is that this particular provision is not very very specific, too. And that's what's included in the news items wherein r may have been called a "toady", a toad.

REP. ARROYO. Mr. Speaker, if the Gentleman from lIocos Sur keeps on referring to himself as a "toady", that's no longer my problem. I have already said that, I don't think of him as a "toady", but if he insists, what can I do.

REP. BATERINA. I am not insisting, Mr. Speaker. In fact, he now insists. REP. ARROYO. So, I already said, he's not. There's nothing I can do if

the shoe fits. So, I already said that I am not referring to ...

REP. BATERINA. Well taken, Mr. Speaker. REP. ARROYO .... the Gentleman as atoady", REP. BATERINA. Well taken, Mr. Speaker. Now, may I now continue with my interpellation?

THE DEPUTY SPEAKER (Rep. Abueg). gentlemen that they speak one after the other.

The Chair admonish the

!

CABAN OS - 2

August 17, 1998

5:40 p.rn

PO - The Deputy Speaker (Rep. Abueg)

The Gentleman from Ilocos Sur may proceed.

REP. BATERINA. Mr. Speaker, I would like to read the constitutional

provision which the Gentleman from Makati based his accusation.

It reads: "No loan, guaranty, or other form of financial accommodation for

any business purpose may be granted, directly or indirectly, by any government-

owned or controlled bank or financial institution to the President, the Vice-

President, the Members of the Cabinet, the Congress, the Supreme Court, and

the Constitutional Commissions, the Ombudsman, or to any firm or entity in which

they have controlling interest, during their tenure."

Now, I would like to ask the Gentleman from Makati if this constitutional

provision particularly applies to the situation which he says are the violations of

Mr. Villar?

REP. ARROYO. Mr. Speaker, yes it applies as queried.

REP. BATERINA. And this ...

REP. ARROYO. Please let me finish the explanation.

Mr. Speaker, this provision is not found in the 1935 Constitution neither is it

found in the 1973 Constitution, this is an entirely new provision. And the

Constitutional Commission inserted this precisely because of the experience

during the Marcos years, where government officials, ... latc .(y

y

SANTOS - 2 August 17, 1998

P.O. - Deputy Speaker Abueg

5:45 p.rn.

REP. ARROYO.

. .. government officials, elective or appointive,

took advantage of their position.

To prevent that, this provision was

in corporated.

It is a catch-all provision forbidding in plain language a

government official of the rank of a legislator, a member of the Cabinet and

a Constitutional Commission, not to have any transaction with any

government financial institution directly or indirectly for any business

purpose.

So, you can see, Mr. Speaker, that even an indirect financial

accommodation for any business purpose is prohibited. That is the thrust of

this provision, to prevent us, Members of the House, from using our position

to influence a government financial institution into giving iiS financial

accommodation, whether directly or indirectly, and it goes even further, not

only us personally but even companies that we control.

That is the

prohibition. The moment a corporation we control, that is no no. 1 nat IS

the rationale for this provision.

REP. BATERt'NA.

""rl. _",:. ,. _ .. r n f 1." ··1· ...

1 uai 1:; LI UI;, IVU. opeas.er, UU l lUI; JJUUlL LlIUL!

would like to make is this, "controlling interest" it says.

The Gentleman

from the First District of Makati has not pointed tv a corporation whereby

Mr. Villar has a controlling interest. and if I may

define '.controilin~11 (l'.Gel

..

SANTOS - 2 August 17. 1998

P.O. - Deputy Speaker Abueg

interest", it is the holding of shares of interest enough to control and dictate

5:45 p.m.

the decisions in the corporation which means, it must be 50 + 1 or 51 %.

REP. ARROYO.

Mr. Speaker, this is really a moot question,

because insofar as Speaker Villar is concerned, the companies I am referring

to here are the Camella and Palmera Homes.

REP. BATERINA.

How much does Mr. Villar In terms of

stockholdings has in these two corporations?

REP. ARROYO.

This is a very very good question. because if mv

the C & P Homes when it offered two miilion shares in the inii..iai public

offering, IPO.

Commission, Mr. Speaker, and that Mr. Villar does not even own JU%

interest in any of the corporations.

REF. ARROYO. Mr. Speaker, I would nope that the Gentleman

YV0u!d allow me to finish. I am being interpellated, therefore, I should be

allowed to finish.

Now, if you will see the second page at the bottom, it reads:

"Virtually all of the issued share capital of the company", meaning, Palmera and Camella, "is currentiy and directly owned byMr. Manuel V. Villar"J

2

SANTOS-2 P.O. - Deputy Speaker Abueg

chairman of the company and founder of this business and his wife, Mrs.

August 17, 1998

5:45 p.m.

Cynthia A. Villar". Virtually all of the issued shares are owned by Mr. and

Mrs. Villar.

Now, it says: "Since they were going to offer this on an IPQ basis,

they were selling practically 20%". So it says here ...

REP. BA.TERINA. How much sir?

REP. ARROYO. "Upon completion of the offers Mr. and Mrs. Villar

will continue to beneficially own 79.6% of the company's issued share

capital through prime properties and have agreed that it will not dispose of

any shares [or a period of six months ... jJ I

!

O'·.GG3

3

LEDESMA.2

P,ugust 17, 1998

5:50 p.rn.

(PO - Rep. Abueg)

REP. ARROYO .... for a period of six (6) months following the date on which the shares are listed on the Philippine Stock Exchange.

Now, fine properties is owned 100% by Mr. and Mrs. Villar. So, there was a layer.

The layer is that, the ownership of Camella and Pamela is through fine properties and fine properties is owned byMr.and Mrs. Villar. So, that's very common in the corporate world. So, what I'm saying .. ,

REP.BATERINA. What you are saying, sir, is that, they owned all of the stocks? REP. ARROYO. Yes.

REP. BATERINA. Can two people own all the stocks in one corporation? REP ARROYO: Could give that to the children who has ...

REP. BATERINA. In other words, there should be more than five (5) stockholders. REP. ARROYO. Let me finish, Mr. Speaker. This, if you will notice my digest,

the C and P Homes prospectus is distributed to prospective buyers. 56, this is in fact very thick. I just culled the summary. It is this thick. Double this, I remove the financial statement. So, I'm quoting 'onlY from the summary which is two pages. The idea is to persuade buyers or to explain to the 'buyers the financial situation of the company plus the ownership. So, it is. Speaker Villar himself who admitted because this is his, This prospectus is Speaker Villar's prospectus. He issued this. It was not issued by anyone, it was issued by him. Here, he says and admits, virtually all of the issued share capital of the company is currently indirectly owned by Mr. Manuel B. Villar,chairman of the company and founder of its business and his wife, Mrs. Cynthia A. Villar. After the IPO,

LEDESMA- 2

August 1 ?, 1998

5:50 p.m.

they will still own 79.6%. So, it's very clear. This is not the statement of anyone. This

is the statement of Speaker Villar. So, how can we contest a statement of Speaker Villar.

REP. BATERINA.· But if the statement does not hold through in a natural sense, I

mean, where the statement goes' against the grain of the law, where the law says, Mr.

Speaker, thai there must be five (5) people who should own a corporation, then that

particular statement is not correct. And then, if it's not correct. the Gentleman from

Makati cannot base his conclusion and bring it to the forum of the Lower House.

REP. ARROYO. . Mr. Speaker, all of us know,practitioners here, we form a

corporation. Ninety-nine percent is owned by the principal stockholder. Then we distribute one share each, qualifying shares. One share to others to form five.' But those

five do not own, we just give them the qualifying shares, That's very common in the practice. So, there's nothing unusual here. The point is that, this is in law admission

against interest, which is the stro.hgestevidence in law, when one says something that is

against himself. So, ~t the time that Speaker Villar said th~s, he had no inkling that he

. . .' .

would get entangled in this investigation. What he was trying to say at that time was, "I

am Speaker Villar, trust me. I own the company. If you trust me, then you can invest in

my company." That's all. If a Rockefeller says, for instance, "Trust me, this is my

company." We will invest. That's how it is. If an Ayala says, 'We own so much, trust

us." But if Mang Pandoy says, 'Trust me." I mean, naturally, we will hesitate. I mean,

that's all there's to it. While the Gentleman from .lIocos Sur seems to challenge my

. statement ... tell

2

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Miluna

August 17, 1998

5:55 p.m.

(P.O. - Rep. Abueg)

REP. ARRO'YO'. . .. my statement, is he trying to challenge the

statement of Speaker Villar? Then that's the problem between the two of

them, not my problem.

REP. BATERINA No, Mr. Speaker.

REP. ARROYO. I mean, if he wants to contest this report, the point

is that let Speaker Villar come here and say "I disown this statement". But I don't think that Atty. Baterina can come here and say "that IS wrong". The

. only one who can say that is Speaker Villar, not Atty. Baterina.

REP. BATERINA That's hot the point, Mr. Speaker. The point that

whereby 1 stood up is the fact that I made a statement in the newspapers and

I said that the constitutional provision is not very clear and thatthere are no facts yet given by the Gentleman from Makati which would support his

statement. And even then, Mr. Speaker, assuming that the Gentleman from

Makati is correct, the point is that we do not even know how much Mr.

Villar has in his participation because the· stockholding of the wife may be

much, much more than Mr. Villar and the wife is not included in the

prohibition,

REP. ARROYO'. Mr. Speaker, the' point here is this. If Mr. Villar

wants to say so, let him come here ~d say so. But why is the Gentleman

Mlh11l3

August 17, 1998

5:55 p.rn.

from Ilocos Sur answering for Speaker Villar? That is really the issue. If

Speaker Villar wants to say something, by all means he can always say "I

don't own this". He can always say "it's something like this, I don't own

it". But there cannot be an argument on the basis of a hypothesis made by

the Gentleman. Let me ask him, tor instance, although I cannot ask him on

interpellation - Is he privy to the records of Speaker Villar? I'm sure he will

say "no". Does he know the inner workings of his company? I'm sure he

will say "no". The only one who knows this is Speaker Villar himself. That

is why I have been saying if he could just answer it, perhaps things will be

clearer. But up to this date, Speaker Villar has not answered any question.

REP. BATERlNA That's just not the point, Me Speaker. The point,

M1'. Speaker, is that the Gentleman from the First District of Makati stood

up on a collective privilege and, therefore, when he said collective it means

the whole of the Members of the Lower House. And when he included me

as one of those who should be part of that collective privilege, Mr. Speaker,

then I have a right to know of tile facts. I have a right to know of whether

what he says to be a collective privilege of the whole Members of the Lower

House are founded on facts, Mr. Speaker. I would like to know then

whether Mr. Villar has a controlling interest in the two corporations cited in

his digest, how much is owned by the wife, how much IS owned by Mr.

W

2

Mlluna

August 17, 1998

5:55 p.m.

Villar because the constitutional provision cited bv the distinguished

_ 1:0

Gentleman from Makati says it should be a controlling interest. That's why

I asked all these. I did not come here to defend Mr. Villar. I came here to be

a part of the collective interest. And when he says that we are part of that

collective interest, I have a right to stand up, to interpellate the Gentleman from Mitlcati.

I would like to thank the Gentleman from Makati for giving me his

time to answer my questions.

Thank you, Mr. Speaker.

REP. ARROYO. You are most welcome, Gentleman fromIlocos Sur,

although I might have to point out that when one rises on a question of

collective privilege, it is prefaced on the proposition that the subject matter affects the integrity of the House. And what I am saying is that if my

charges are correct, therefore, the integrity of the House will be impaired

because we have for a leader, one, who has violated the Constitution that's

why we are ventilating it here. We are not making any judgments yet. We

are just raising.questions,

THE DEPUTY SPEAKER (Rep. Abueg). What's the pleasure of the

Gentleman from the Second District ofLeyte? .

3

Mlluna

August 17, 1998

. 5:55 p.m.

REP. APOSTOL. May I know, Mr. Speaker, if the Gentleman from Makati will allow interpellations from this Representation?

THE DEPUTY SPEAKER (Rep. Abueg), He may do so if he so

desires.

REP. ARROYO~ Gladly, Mr. Speaker.

THE DEPUTY SPEAKER (Rep. Abueg). The Gentleman from Leyte may proceed with his interpellation.

REP. APOSTOL. Mr. Speaker- Your Honor, may I begin by saying

that. .. ./~

4

MALIWAT - 2

August 17, 1888

6:00 p.m.

(PO - DEPUTY SPEAKER ABUEG)

REP. APOSTOL.

may I begin by sayin~ that I am

not one of the cronies aT the Speaker .

REP. ARROYO. I Serge, I never said you are a crony. (Laughter)

REP. APOSTOL.

. . . according to the co Lumn of Ninez

Cacho Olivarez.

Your Honor, Mr. Speaker, t.he 'first law which is quoted here Le the pr-ov.t e Lon of the Corie t.Lt.u t Lon , Article XI, Section 16. May I know if there is an enabling law on this?

REP. ARROYO.

There ,is no enabling, law, Mr. Speaker,

because the provision does not require an enabling law. As a matter of fact, there are certain provisions in the

Consti tution which provide for an enabling Law;

There are

certain sections which are quiet.

In fact most of the

provisions of the Constitution are self-executing, no enabling law is needed.

REP. APOSTOL. So, it is now the opinion of Your Honor that this Section 16 is self-executory?

REP. ARROYO. Yes, 111'. Speaker. This is self-executory because it is negatively phrased, it is prohibitory.

REP.

APOSTOL.

Now.

if somebody violates this

provision, what is the sanction for violation of this

constitutional prOvision?

REP. ARROYO. That is for. that is why I am presenting it here. I am presenting it to the Body .If you notice in my speech I am not even asking for the penalty, I am raising

t1ALIWAT - 2

Auguet 17,1998

6:00 p.m.

this point, saying, the Speaker has violated this provision, it is up for this august Chamber to make a resolution. I make. no recommendation.

REP. APOSTOL. Yes. But how will you guide the Members of this Body in making a decision when, for tnat.ance, since the charge is specific, and allegedly, Your Honor, the Speaker Violated this provision, how will now the Members of this Committee decide on what action or sanction will this Body make because ·there is no sanction, no penalty, no enabling law implementing this provision in case there is violation 'on this. specific law, specific provision of the Constitution?

·REP. ARROYO. Mr. Speaker, this august House is supreme in its own sphere. Not even the President of the Philippines can interfere in our proceedings, not even the Senate, not the Supreme Court. When an issue is laid in plenary for the Judgment of the Houas, like judge the Houae is empowered to do what it wants to do or i·t has to do. There are no r-ee t.r-LctLons, there are no limitations except our good cortec Lertce , except our own good sense. That is why, we present this, that is entirely- up to the House to do what it wants to do.

But we cannot have a dead letter provision that is in

the Constitution.

What I am try-ing to point out is while

there can be dead letter statutes, letter constitutional provision.

there can I raised

be no dead the points

squarely I leave it to the Membership.

o':r7T

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