TATAD VS DEPARTMENT OF ENERGY

G.R. No. 124360 and 127867. November 5, 1997

FACTS:

The petitioner, Tatad, questioned the constitutionality of RA No. 8180 “An Act Deregulating the
Downstream Oil Industry and For Other Purposes.” The deregulation process has two phases: (a) the
transition phase and the (b) full deregulation phase through EO No. 372.

The petitioner claims that Sec. 15 of RA No. 8180 constitutes an undue delegation of legislative
power to the President and the Sec. of Energy because it does not provide a determinate or determinable
standard to guide the Executive Branch in determining when to implement the full deregulation of the
downstream oil industry, and the law does not provide any specific standard to determine when the prices
of crude oil in the world market are considered to be declining nor when the exchange rate of the peso to
the US dollar is considered stable.

ISSUE:

1. Whether or not Sec 15 of R.A. 8180 is unconstitutional for violation regarding the prohibition on
undue delegation of power.

RULING:

The court ruled that RA No. 8180 is declared unconstitutional and ED. No. 372 void.The rational
of the Court annulling RA No. 8180 is not because it disagrees with deregulation as an economic policy
but because as cobbled by Congress in its present form, the law violates the Constitution.

There are two accepted tests to determine whether or not there is a valid delegation of legislative
power, viz: the completeness test and the sufficient standard test. Under the first test, the law must be
complete in all its terms and conditions when it leaves the legislative such that when it reaches the
delegate the only thing he will have to do is to enforce it. Under the sufficient standard test, there must
be adequate guidelines or limitations in the law to map out the boundaries of the delegate's authority
and prevent the delegation from running not. Both tests are intended to prevent a total transference of
legislative authority to the delegates who is not allowed to step into the shoes of the legislature and
exercise a power essentially legislative.

The validity of delegating legislative power is now a quiet area in our constitutional landscape. As
sagely observed, delegation of legislative power has become an inevitability in light of the increasing
complexity of the task of government. To cede to the Executive the power to make law is to invite tyranny,
indeed, to transgress the principle of separation of powers. The exercise of delegated power is given a
strict scrutiny by courts for the delegate is a mere agent whose action cannot infringe the terms of agency.