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  • Tatad V Sec of Energy

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    Anthony S. Angulo
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    This case challenges the constitutionality of a law deregulating the downstream oil industry. Specifically, Section 15 is argued to constitute an undue delegation of legislative power because it does not provide clear standards to guide the executive branch in determining when full deregulation should be implemented. The court held that Section 15 is not an undue delegation because it provides determinable standards by stating that full deregulation will begin by March 1997 and should be timed when crude oil prices and the exchange rate are stable and declining. However, the court also held that the executive misapplied the law by considering depletion of a fund as a factor, when that was not included in the standards provided by the law.

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    This case challenges the constitutionality of a law deregulating the downstream oil industry. Specifically, Section 15 is argued to constitute an undue delegation of legislative power because it does not provide clear standards to guide the executive branch in determining when full deregulation should be implemented. The court held that Section 15 is not an undue delegation because it provides determinable standards by stating that full deregulation will begin by March 1997 and should be timed when crude oil prices and the exchange rate are stable and declining. However, the court also held that the executive misapplied the law by considering depletion of a fund as a factor, when that was not included in the standards provided by the law.

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    © All Rights Reserved
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    14 views1 page

    Tatad V Sec of Energy

    Uploaded by

    Anthony S. Angulo
    This case challenges the constitutionality of a law deregulating the downstream oil industry. Specifically, Section 15 is argued to constitute an undue delegation of legislative power because it does not provide clear standards to guide the executive branch in determining when full deregulation should be implemented. The court held that Section 15 is not an undue delegation because it provides determinable standards by stating that full deregulation will begin by March 1997 and should be timed when crude oil prices and the exchange rate are stable and declining. However, the court also held that the executive misapplied the law by considering depletion of a fund as a factor, when that was not included in the standards provided by the law.

    Copyright:

    © All Rights Reserved
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    of 1

    Tatad v. Secretary of Energy [Nov.

    5, 1997]

    24 SEP
    FACTS:
    The petitions challenge the constitutionality of RA No. 8180 entitled “An Act Deregulating the
    Downstream Oil Industry and For Other Purposes.” The deregulation process has two phases: (a) the
    transition phase (Aug. 12, 1996) and the (b) full deregulation phase (Feb. 8, 1997 through EO No.
    372).

    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:
    w/n the provisions of RA No. 8180 and EO No. 372 is unconstitutional.
    sub-issue: (a) w/n sec. 15 violates the constitutional prohibition on undue delegation of power, and
    (b) w/n the Executive misapplied RA No. 8180 when it considered the depletion of the OPSF fund as
    factor in fully deregulating the downstream oil industry in Feb. 1997.

    HELD/RULING:
    (a) NO. Sec. 15 can hurdle both the completeness test and the sufficient standard test. RA No. 8180
    provided that the full deregulation will start at the end of March 1997 regardless of the occurrence of
    any event. Thus, the law is complete on the question of the final date of full deregulation.

    Sec. 15 lays down the standard to guide the judgment of the President—he is to time it as far as
    practicable when the prices of crude oil and petroleum in the world market are declining and when
    the exchange rate of the peso to the US dollar is considered stable.

    Webster defines “practicable” as meaning possible to practice or perform, “decline” as meaning to


    take a downward direction, and “stable” as meaning firmly established.

    (b) YES. Sec. 15 did not mention the depletion of the OPSF fund as a factor to be given weight by the
    Executive before ordering full deregulation. The Executive department failed to follow faithfully the
    standards set by RA No. 8180 when it co0nsidered the extraneous factor of depletion of the OPSF
    fund. The Executive is bereft of any right to alter either by subtraction or addition the standards set
    in RA No. 8180 for it has no powers to make laws.

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