Republic of the Philippines Francisco Gold Condominium IT EDSA Cor. Mapagmahal St., Diliman Quezon City OFFICE OF THE UNDERSECRETARY Legal Opinion No. 43 s. 2011 JUL 15 2011 GepARTMENT OF THE IMTemiOR "AND LOCAL GOVERNMENT py ameen reer Se RELEASE CARD MRI | 20 M.L. Quezon St. SIGNATURE. L City Subdivision, San Pablo City 4000 oate__7- WI Laguna ae cowreat av, 2G2F- Dear Atty. Buenaventura: This has reference to your letter requesting for further clarification on the prior opinion rendered by this Department onf the collection of barangay clearance fees by several barangays on the conduct of CARD MRI's meetings and seminars thereat. In April 2011, the Department issued a letter/opinion addressed to Punong Barangay Victor V. Tumagay of Barangay Tumagay, Plaridel, Quezon and emphasized the legal basis for the Issuance of a BARANGAY CLEARANCE FEE and the reasonableness thereof. In sum, we concluded, among others, that: "if the CARD-MRI has afready paid the barangay clearance fee on the barangay where its branch office is located, usually at the town/city proper, and was, accordingly, issued a ‘Mayor's Permit, it could no longer be made to pay by the other barangays where CARD's staff personnel are ssent out to conduct meetings and seminars. ‘This was the bone of contention raised by the PLB. It claimed that it may impose and collect from CARD MRI barangay fees since "collection of loan payments” is a business activity, and that in the Department's opinion, barangay fees may no longer be paid where CARD'S staff personnel are sent out to conduct “meetings and seminars”. CARD MRI clarified, however, that it merely facilitates the meeting, assists in the gathering of members’ loan payments, and assigns a member responsible for remitting the members’ payments to the depository bank of CARD MRI. Hence, CARD MRI's request for clarification. We reiterate the legal basis upon which a barangay clearance may issue, as set forth in Section 152 of RA 7160: "Section 152. Scope of Taxing Powers.-- The barangays may levy taxes, fees, and charges, as provided in this Article, which shall exclusively accrue to them. xxx vox xx (©) Barangay Clearance.-- No city or municipality may issue any license or permit for any business or activity unless a clearance is first obtained from the barangay where such business or activity is located or conducted. For such clearance, the sangguniang barangay may impose a reasonable fee. The application for clearance shall be acted upon within seven (7) working days from the filing thereof. In the event that the clearance is not issued within the said period, the city or municipality may issue the said license or permit." (Emphasis Supplied) ‘The Barangay Clearance is issued as prerequisite before a BUSINESS LICENSE OR PERMIT may issue to cover the business or activity conducted_by a particular firm or entity which is_ in ‘The Business License or Permit, commonly termed as a Mayor's License or Permit, authorizes the registered entity located in the area under the territorial jurisdiction of the issuing local government unit (city or municipality) to engage in the business or conduct its activity in the said territory. The same business permit or license is issued to branches, factories, warehouses, or similar business edifice when located in theterritorial jurisdiction of the LGU and a barangay clearance may be issued by the barangay where such branch, factory, warehouse, or similar business edifice may be located. This is the premise of the Department's opinion that once such Mayor or Business Permit or License is secured, an entity may no longer be imposed a similar Barangay Clearance by other barangays whenever such entity holds or conducts a meeting or seminar. In this case, CARD MRI_ has secured a corresponding Mayor's Permit of License from the barangay where it is located. CARD MRI allege that it does hold meetings or seminars in different barangays to meet with its members and hold the same in designated centers which, more often than not, are in the houses of the members. CARD MRI facilitates the meeting, assists in the gathering of members’ loan payments, and assigns a member responsible for remitting the members’ payments to the depository bank of CARD MRI. CARD MRI avers that it does not collect the members’ loan payments. PPLB ruled that involved barangays can collect barangay clearance fee because “collection of payment” is considered a business activity. We do not agree. ‘The Barangay Clearance under Section 152 of RA 7160 is issued for a specific purpose --_as a requirement before any business permit or license is issued by the Mayor's Office. The barangay issuing such clearance is the place wheren the business or activity is located. ‘The collection of loan payment by an entity, if and when conducted, may not be subject to an additional barangay clearance fee provided that said entity has already paid the Business Permit or License where such entity is located. Ergo, the Barangay Clearance should not be issued as a means to replace or replicate the BUSINESS PERMIT which only a city or municipality may lawfully issue. Under the foregoing premises, we reiterate the application of DILG Opinion No. 37, Series of 2009 and the recent opinion rendered in April 2011, and hereby clarifies that if the CARD- MRI has already paid the barangay clearance fee on the barangay where its branch office is LOCATED, usually at the town/city proper, and was, accordingly, issued a Mayor's Permit, it_could_no_longer be made to pay by the other barangays where CARD's staff personnel are sent out to conduct meetings and seminars. As pointed out by CARD MRI, no collection of money by CARD MRI is being made but the latter only faciliates the conduct of the meeting or seminar and that the remittance is made by the members themselves to the depository bank of CARD MRI. ‘There may be instances where a Barangay Clearance is issued independent of a business license or permit, e.g., proof of residency for job applicants, _ provided that such issuance and the fee imposed therefor are sanctioned by a Barangay Ordinance, the fee imposed is, reasonable, an official receipt of the Republic of the Philippines is issued upon collection of the fee. Very truly yours, STERE A. PANADERO UNDERSECRETARY 15:55/06 2 fe