Bicam Deliberations - Day 1

Republic of the Philippines
CONGRESS OF THE PHILIPPINES

SENATE
Pasay City
BICAMERAL CONFERENCE COMMITTEE

ON THE DISAGREEING PROVISIONS OF
SENATE BILL NO. 2282 AND HOUSE BILL NO. 5286
(FAIR COMPETITION ACT OF 2015)
DATE : Tuesday, June 2, 2015
TIME : 10:30 a.m.
VENUE : Sen. Claro M. Recto Room

2nd Floor, Senate of the Philippines
Financial Center, Roxas Boulevard
Pasay City
AGENDA : Disagreeing Provisions of Senate Bill

No. 2282 and House Bill No. 5286 (Fair
Competition Act of 2015)
ATTENDANCE
SENATE PANEL:
HON. PAOLO BENIGNO “BAM” AQUINO IV - Chairman

HON. SONNY M. ANGARA
HON. AQUILINO “KOKO” L. PIMENTEL III
HON. CYNTHIA A. VILLAR
HON. SERGIO R. OSMEÑA III
HON. VICENTE C. SOTTO III
HON. TEOFISTO L. GUINGONA III
HOUSE PANEL:
HON. DAKILA CARLO E. CUA - Chairman

HON. RUFUS B. RODRIGUEZ
HON. XAVIER JESUS “XJ” D. ROMUALDO
HON. ANTHONY G. DEL ROSARIO
HON. IBARRA “BARRY” M. GUTIERREZ III
HON. ANTONIO L. TINIO
1
BICAMERAL CONFERENCE COMMITTEE ON THE DISAGREEING
PROVISIONS OF SENATE BILL NO. 2282 AND HOUSE BILL NO. 5286
Tuesday, June 2, 2015
GUESTS/RESOURCE PERSONS:
Ms. Abigail R. Zurifa - Officer-in-Charge, Liaison

Office for Legislative
Affairs, Department of
Trade and Industry (DTI)
Mr. Francis Sumo - DTI
Ms. Irish Almeida - Trade Project, DTI
Atty. Samantha V. David - International Container
Terminal Services, Inc. (ICTSI)
Mr. Marco Santiago - Process Technologies Inc. (PTI)
Mr. Carlos Abad Santos - National Economic
Development Authority (NEDA)
Dir. Heiddi Barrozo - Department of Justice (DOJ)
Atty. Jane Garcia - DOJ
Atty. Sarita Alvarado - DOJ
SENATORS’ STAFF:
Ms. Siera Ferrer - O/S Aquino

Mr. Nicco Atos - O/S Aquino
Mr. Boom Enriquez - O/S Aquino
Mr. Louie Matienzo - O/S Aquino
Ms. Thea Murig - O/S Aquino
Ms. Mona Yap - O/S Aquino
Ms. Anna Venturina - O/S Aquino
Ms. Cecile Palines - O/S Aquino
Ms. Helen Graido - O/S Aquino
Mr. Dexter Fajardo - O/S Aquino
Ms. Tiffany De Guzman - O/S Aquino
Ms. Carole Malenab - O/S Aquino
Ms. Ayvie Peñaredondo - O/S Aquino
Mr. Dennis Legaspi - O/S Angara
Ms. Sugar Sallador - O/S Angara
Ms. Sheiva Gonzales - O/S Angara
Ms. Kindel Paroy - O/S Angara
Ms. Vanessa Tanghal - O/S Angara
Mr. Mark Robert Dy - O/S Guingona
Ms. Leria Bayalot - O/S Guingona
Mr. Allan Bodino - O/S Guingona
Mr. Ron Reyes - O/S Guingona
Mr. Ryan Martin T. Macalatan - O/S Pimentel
Atty. Elbert Cruz - O/S Pimentel
Atty. Lezel De Villa - O/S Sotto
Mr. Ramon Lopez - O/S Sotto
2
Tuesday, June 2, 2015
Mr. Michael Caben - O/S Sotto

Ms. Armi Corpuz - O/S Villar
Ms. Charlene de Leon - O/S Villar
SENATE SECRETARIAT:
Mr. Arturo I. Mojica Jr. - Director III, Committee “C”

Mr. Joey M.Tunac - Committee Secretary
Ms. Jingle C. Allam - Committee Secretary
Ms. Cecilia T. Sotto - Committee Stenographer
Ms. Araceli D. Masicap - Committee Stenographer
Ms. Cristina DC. Astrero - Committee Stenographer
Ms. Paulette L. Manuel - Committee Stenographer
Ms. Helen S. Gayapa - Committee Stenographer
Ms. Susana Grace L. Robles - Committee Stenographer
Mr. Eric Jalandoon - Legislative Page
Mr. Emerson Carreon - Legislative Page
Ms. Mildred C. Fisico - Committee Clerk
Ms. Realyn C. Garces - Committee Clerk
Mr. Bong Prudencio - Legislative Police
Mr. Amiel Eleda - Legislative Police
Mr. Roland D. Laureano - Audio Technician
Mr. Jose G. Busalpa Jr. - Audio Technician
Ms. Justine Martinez - Audio Technician
REPRESENTATIVES’ STAFF:
Mr. Francis Soriano - Office of Rep. Cua

Mr. Edwin Bartido - Office of Rep. Cua
Ms. Mae L. Chatto - Office of Rep. A. Del Rosario
Ms. Maria Concepcion B. Mendoza Balduela- Office of Rep. Gutierrez
HOUSE OF REPRESENTATIVES SECRETARIAT:
Ms. Jannalinna Alladas - Committee Secretary

Ms. Lina Nortega - Service Director
Ms. Joefina Fontanilla - SLSO II
Mr. Filomena Sambilay - SLSO II
Ms. Ma. Cristina Sulaik - SLSO II
Ms. Lorilyn De Castro - Legislative Staff Officer VI
Ms. Amelita Valencia - Legislative Staff Officer VI
Ms. Ma. Theresa Alcalde - Legislative Staff Officer VI
(For complete list, please see attached Attendance Sheet.)
3
PROVISIONS OF SENATE BILL NO. 2282 AND HOUSE BILL NO.
5286 (FAIR COMPETITION ACT OF 2015)
ctsotto I-1 June 2, 2015 10:45 a.m. 1
AT 10:45 A.M., HON. PAOLO BENIGNO “BAM”

AQUINO IV, CHAIRMAN OF THE SENATE PANEL, AND
HON. DAKILA CARLO E. CUA, CHAIRMAN OF THE
HOUSE PANEL, CALLED THE MEETING TO ORDER.
THE CHAIRMAN (SEN. AQUINO). Magandang umaga.
First of all, we would like to welcome the Congress Panel and
thank them for making the trip to the Senate. So, thank you for
agreeing to have the bicam here.
I’d like to acknowledge the members of my panel. Of course to
my right is the Minority Floor Leader, Senator Tito Sotto. Magandang
umaga po. We also have Senator Cynthia Villar with us. Good
morning, Senator Cynthia. Magandang umaga. The other members of
our panel are Senators Guingona, Pimentel, Angara and Ejercito. And
Ejercito, if I am not mistaken. Yes? I am looking at my back, no one
is looking at me.
Senator Ejercito is also part of the panel? Yes. So my
colleagues will be dropping in and they have full confidence in the
panel to push through with the bicam.
So let me just begin by saying that last night we actually had a
pre-meeting and Congressman Del Rosario raised that this is the
longest running bill currently filed in Congress. So I don’t know if
Senator Sotto was already a senator when this was filed. Maybe even
4
ctsotto I-1 June 2, 2015 10:45 a.m. 2
before your time, in the Eighth Congress. Were you already a
member in the Eighth Congress?
SEN. SOTTO. Before my time. I was in the Ninth Congress.
THE CHAIRMAN (SEN. AQUINO). So even before Senator
Sotto’s time. So this has been in the running for--maybe 20 years
already or more? Over 20 years. And we’re truly hoping that we can
pass this bill, come up with a good bill. Both versions of Congress and
the Senate actually both have points which are good points. And
although there are some differences, I think they are not too far that
we can actually find a common ground or even agree on which version
is better. So definitely we’ll be engaging on this process.
Let me also just add on the side of the Senate Panel that we’ve
agreed with the Chairman of the Congress Panel to first go through the
points where there is agreement. Because with the bill this important
and lengthy, we don’t expect that we will be finished today. So as
much as possible, we’ll probably go through the parts of the bill where
our versions are quite close, if not identical and go through that as a
first pass. And if there are discussions that you want to be raised, if
there are minor changes, we can, of course, tackle right away. But if
there are major changes, we can set them later in the day or even on
5
ctsotto I-1 June 2, 2015 10:45 a.m. 3
our second day. So as much as possible we would want to go through
the provisions which are identical or even with minor changes.
So with that, let me turn over to our chairman of the House
Panel. Magandang umaga, Chairman Cua.
THE CHAIRMAN (REP. CUA). Thank you, Senator Bam
Aquino.
Dear senators, Senator Osmeña, Senator Sotto, Senator Villar,
on behalf of the House Panel, I would like to acknowledge and
introduce our members. In my extreme left is Congressman Barry
Gutierrez, and beside him is Congressman Antonio Tinio, and--for the
minority, yes. And also from the House Panel is Congressman XJ
Romualdo of Camiguin; Congressman--of course, beside me is the ever
famous Congressman Rufus Rodriguez who took time out from the BBL
to be here today. And, of course, to my right is our Congressman
Anthony del Rosario of Davao.
As Senator Bam has—as you correctly mentioned this is the
longest running bill that has been pending in Congress since 1980s,
since the Eighth Congress. And the House leadership expresses full
support for the passage of this legislation and we see it as a landmark
milestone for the Philippines, especially given the background of the
ASEAN Integration wherein the commission, once chartered by this
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ctsotto I-1 June 2, 2015 10:45 a.m. 4
law, will play a pivotal role in the economic development of our
country. And so, we join you in coping to accomplish as much as we
can today, understanding that we will not rush into decisions on all
provisions but come to an agreement so that we can have the best
version possible of this law.
So on the part of the House, we call this meeting to order.
THE CHAIRMAN (SEN. AQUINO). Yes and I’d like to correct
myself for the record. Senator JV is not actually part of the panel.
Senator Osmeña is part of our panel.
We’ve also agreed previously that we will have a closed bicam.
So we would like to instruct the members here who are not members
of our offices or staff or designated experts or consultants to please
leave the room.
So are we all here members of the Congressmen’s staff?
THE CHAIRMAN (REP. CUA). Sorry, Senator, we agreed that
members of government agencies concerned are to be present.
THE CHAIRMAN (SEN. AQUINO). Yes. So ano ho? Are we
all members of the staff? Can we ask the—to check?
So everyone who is present, please be either a member of the
government agency that we had instructed to attend, the member of
the comsec, the Congress and the Senate, member of our staff, of the
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ctsotto I-1 June 2, 2015 10:45 a.m. 5
senators present or other senators or legislators who want to be here.
Okay. So if you don’t belong here, please--you know who you are
anyway.
Alright, Chairman—
THE CHAIRMAN (REP. CUA). I just like to add for the record
that there is one conferee who is not present today but he is a member
of the panel who is Congressman dela Cruz.
THE CHAIRMAN (SEN. AQUINO). And we would like to
acknowledge Senator Guingona.
All right, Chairman, shall we begin? Yes.
As tradition, we tackle the short title last and the title last. So
can we go to Section 2. I am proposing that we adopt the Senate
version with the following amendments. Replace subparagraph (a)
with the House’s subparagraph (a). Replace subparagraph (b) with the
House’s subparagraph (b), and we adopt the House’s—HOR’s
paragraph (c).
This is Section 2, Senator.
THE CHAIRMAN (REP. CUA). Yes. On the part of the House,
Mr. Chairman, we accept the proposal.
THE CHAIRMAN (SEN. AQUINO). Thank you, Mr. Chairman.
So we move on.
8
ctsotto I-1 June 2, 2015 10:45 a.m. 6
For Section 3, the suggestion is that we combine the Senate and
House version to read as follows:
“Section 3. Scope and Application. – This Act shall be
enforceable against any person or entity engaged in any trade,
industry and commerce in the Republic of the Philippines. It shall
likewise be applicable to international trade having direct, substantial
and reasonably foreseeable effects in trade, industry or commerce in
the Republic of the Philippines, including those that result from acts
done outside the Republic of the Philippines.
“This Act shall not apply to the combinations or activities of
workers or employees nor to agreements or arrangements with their
employers when such combinations, activities, agreements, or
arrangements are designed solely to facilitate collective bargaining in
respect of conditions of employment nor to any micro, small and
medium-sized enterprises or MSMEs provided they, whether singly or
collectively, do not constitute a dominant position in the relevant
market.” … cts
9
ADMasicap II-1 June 2, 2015 10:55 a.m. 1
THE CHAIRMAN (SEN. AQUINO). ...relevant market.
THE CHAIRMAN (REP. CUA). Mr. Chairman, I think some
members of our panel have reservations.
May I recognize Congressman Gutierrez?
REP. GUTIERREZ. Thank you, Mr. Chair.
Our main consideration, Mr. Chair, with respect to this particular
provision is the exemption granted to micro, small and up to
medium-sized enterprises. Under the MSME law, this will cover
entities with assets up to P100 million. And our concern is that since
we are using relevant market as a context for application of the
majority of the provisions of this particular act, a cap of P100 million
might be too high because a 100 million-peso corporation might
actually be in a position to engage in anti-competitive conduct
depending on the relevant market concerned.
So, that is the main concern of the House panel, Mr. Chair.
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, may we
suggest—we actually have wording that can save that concern and
we had actually tackled that concern previously. We do have that
line, “do not constitute a dominant position in the relevant market,”
and we can even add, “and their acts do not give rise to elimination
of competition in a substantial part of the relevant market.”
10
So, in short, the exemption is only for those who will not violate
the act and—well, I wish we could keep this because this is one of the
few amendments of the minority in the case of the competition law.
But I understand the concern of the possible loophole. So, Mr.
Chairman, if I may propose language, if that is okay and if this is
acceptable to the panel.
THE CHAIRMAN (REP. CUA). Any proposal is welcome, Mr.
Chair.
THE CHAIRMAN (SEN. AQUINO). I am proposing that we say
“nor to any micro, small and medium-sized enterprise (MSME)
provided they, whether singly or collectively, do not constitute a
dominant position in the relevant market and their acts do not
substantially or reasonably prevent, restrict or lessen competition in
the relevant market.”
So, it’s a safety, Mr. Chairman, that we will not be needlessly
exempting enterprises which might actually be restricting competition
or actually a dominant player in a relevant market.
THE CHAIRMAN (REP. CUA). Cong. Rufus.
REP. RODRIGUEZ. Mr. Chairman, Section 3 is on scope and
application. So, it is very necessary that in this particular section we
don’t give specific exemptions to particular enterprises or companies.
11
If we already start exempting, for example, in this case, Mr.
Chairman, we start exempting micro, small and medium enterprises,
then it will give the impression that there are certain enterprises that
are already exempt. In fact, because—if they are small and they have
not committed anti-competitive agreements, then certainly they will
not be in violation of the law because this has to apply to each and
every enterprise because we talk about relevant markets. And so I’m
just afraid that if we have specific exemptions, it is not therefore
already universal in scope as far as relevant markets are concerned.
Then we should take note under the MSME Law, micro is less than
three million; small is three to 15 million; but medium is 15 million to
100 million and certainly a hundred million capitalization in a relevant
market may be big and so we therefore say this might just really
affect the entire integrity of the competition policy law.
SEN. VILLAR. Mr. Chairman, may I interject?
THE CHAIRMAN (SEN. AQUINO). Yes, Senator Villar.
SEN. VILLAR. I think when you say 100 million, it’s asset, it’s
not capitalization. So, the capitalization is much lower. So, we are
afraid of only here is the medium. But the micro and small, they
cannot really be dominant in the market. So, we are talking only of
the medium. But my fear here is, if you include them and they are
12
small already—you know this law will be implemented by people and
some people, they take the law to hassle businessman. You know,
that is the problem. So, we do not want to hassle na iyong micro,
small and medium because they are having a hard time competing...
Because this law might be used to hassle businessman by the
government. That is our fear here. The businessmen are not afraid
of being prosecuted by disobeying the law but this can be used also to
hassle them, you know. This is the power of government, to force
businessman to toe the line. So, that is what we are afraid of here.
So, we don’t want the small, the micro and the medium to be hassled
pa because they are already having a hard time competing under our
condition. Hindi bale iyong malalaki because they can always hire
lawyer to fight government but the small, medium and micro, they
cannot fight government. So, maybe we should give due consideration
to the small ones. Kasi this law can be used also to ask companies to
toe the line by administration and government. And it is being done
now.
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, if we cannot
come to an agreement now, maybe we can park this in the meantime,
Scope and Application.
13
THE CHAIRMAN (REP. CUA). I think that is a wise
recommendation, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). And in fact, we’ll even
speak to the senator who proposed this. We might be willing. If we
just restrict to the two, micro and small enterprises, and took out the
medium, would that suffice, Congressman?
REP. RODRIGUEZ. I am really concerned on the scope and
application—on general application. We are here putting a
classification which will have to contend with the equal protection
clause of the Constitution. In a field where we have relevant markets
and it may be a small market and even a 15-million asset or 30-
million asset can be a dominant position. I am just really concerned
that we are going by any exception, we will be creating a class of
enterprises which will not be reachable by this.
And so, I would rather that we have the scope and indeed if
they are really small, there is no chance. But that is precisely what
the law is all about. There can be no prosecution and there can be no
inquiry if they are not really in the dominant position.
So, I am just concerned of giving exemptions to certain
enterprises because we are having a competition policy all over the
Philippines for implementation. That’s just what my thing is.
14
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, we agree to
park in the meantime.
THE CHAIRMAN (REP. CUA). Likewise, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, I propose we
skip Section 4 as we are still finalizing a number of definitions. So, we
park Section 4, Mr. Chairman. That’s my proposal.
THE CHAIRMAN (REP. CUA). We agree, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Okay, we go to Chapter II
and this is the Composition of the Commission.
For proposed Section 5, Mr. Chairman, we proposed to use the
Senate version and insert the “competition” before “policy;” change
the word “fair” to “Philippine”; change “fair” to “Philippine” after “shall
be known as the”; change “one year” to “60 days”; and replace
“repealed” with “amended”. So, it shall read as follows, Mr. Chairman.
Section 5—
SEN. VILLAR. Mr. Chairman, we are in Section 5 of Chapter II.
How about Section 3 of Chapter II? Why are we going to Section 4?
THE CHAIRMAN (SEN. AQUINO). We are laying it on the
table, Senator Villar, because we agreed that we will tackle first the
provisions where there is general agreement.
SEN. VILLAR. So, we are holding.../admasicap
15
CDAstrero III-1 June 2, 2015 11:05 a.m. 1
SEN. VILLAR. …So, we are holding Section 3, Chapter II
because there is no agreement?
THE CHAIRMAN (SEN. AQUINO). This is the definitions.
SEN. VILLAR. This is deletion. Iyong term ng commissioner?
THE CHAIRMAN (SEN. AQUINO). Not yet. We haven’t
reached that—
SEN. VILLAR. No, that’s Chapter II, Section 3. We’re now on
Chapter II, Section 5.
THE CHAIRMAN (SEN. AQUINO). Section 1.
SEN. VILLAR. Section 1. We’re in Chapter II, Section 1?
THE CHAIRMAN (SEN. AQUINO). No. Because with the
renumbering, Senator Villar, what is Chapter II, Section 1 in our
version—
Let me instead read the title instead of the chapter so we’re
clear. So, this is Chapter V, Philippine Competition Commission,
Section 1 in the Senate version, Section 18 in the Congress version
and the proposed Section 5 for the consolidated version.
SEN. VILLAR. Hindi, ano na ito? Saan na ito? Chapter II,
Section 2?
So, we’re in Section 1 of Chapter II.
16
THE CHAIRMAN (SEN. AQUINO). Okay. Maybe the
confusion, Senator, is that we are renumbering the sections to go
straight down.
SEN. VILLAR. Kaya nga. When we prepared our outline, it’s a
different one. So, it’s now a different one.
Can we go back again?
We are in Chapter II Section 1.
THE CHAIRMAN (SEN. AQUINO). Of our version, of the
Senate version.
SEN. VILLAR. Okay, okay.
THE CHAIRMAN (SEN. AQUINO). So, Chapter II, Section 1 of
the Senate version, we propose to make it Section 5 of Chapter V in
the consolidated version and it shall read as follows, “Section 5. The
Philippine Competition Commission - To implement the National
Competition Policy and to attain the objectives and purposes of this
Act, an independent quasi-judicial body is hereby created, which shall
be known as the Philippine Competition Commission or PCC,
hereinafter, referred to as the Commission and which shall be
organized within sixty (60) days after the approval of this Act.
“Upon establishment of the Commission, Executive Order No. 45,
designating the Department of Justice as the competition authority, is
17
hereby amended. The Office for Competition under the Office of the
Secretary of Justice shall, however, be retained with his powers and
functions modified pursuant to Section 9 of this Chapter.”
The Commission shall be an attached agency to the Office of the
President as proposed, Mr. Chairman.
Where the cursor is should be amended.
REP. RODRIGUEZ. Mr. Chairman, can we go to Section 9 of
this chapter so that we can—Can you give us time to go on what is
now Section 9 which is, therefore, the modified function?
THE CHAIRMAN (SEN. AQUINO). I’m sorry. Thank you for
pointing that out, Congressman.
REP. RODRIGUEZ. What are the functions you take?
VOICE. [Off-mike] Section 9 is Emoluments.
THE CHAIRMAN (SEN. AQUINO). Actually, this Section 9
refers to the Senate version. We have to correct it to the corrected
Section 9.
REP. RODRIGUEZ. Okay.
THE CHAIRMAN (SEN. AQUINO). Maybe in the interest of
clarity, we are adopting the numbering where the sections continue
from one onwards rather than going back to one for every chapter.
So, that it’s clear in the future. So, this is not Section 9—12.
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VOICE. [Off-mike] This is actually 13 in Page 22.
VOICE. [Off-mike] Section 9.
THE CHAIRMAN (SEN. AQUINO). Yes, Section 13 of the
same chapter.
SEN. SOTTO. [Off-mike] Powers and Functions.
THE CHAIRMAN (SEN. AQUINO). Yes, sir.
REP. RODRIGUEZ. So, Mr. Chairman, I would take it to mean
that under Section 13, Office for Competition, Powers and Functions—
So, the OFC under the Department of Justice shall continue to
investigate and prosecute all criminal offenses arising under this Act
and other competition-related laws which is also part of the House
version. And then the OFC shall be reorganized and allocated
resources as may be required, therefore, to effectively pursue its
mandate.
The mandate, Mr. Chairman, is only to investigate and prosecute
criminal offenses. Is that correct?
THE CHAIRMAN (SEN. AQUINO). Yes, Mr. Chairman.
REP. RODRIGUEZ. So, I think, there’s no problem with that.
Yes.
SEN. VILLAR. I just want to clarify, Mr. Chairman, so iyong
Philippine Competition Commission would be administrative and the
19
Office for Competition of DOJ would be criminal. Ganoon ba ang
difference?
THE CHAIRMAN (SEN. AQUINO). Yes, Senator Villar.
[Informal discussion]
THE CHAIRMAN (REP. CUA). Mr. Chairman, there is a
proposed rewording, if it’s acceptable, to delete the word “investigate
and.” So, the wording shall be “The DOJ-OFC shall continue to
prosecute all criminal offenses,” etcetera.
THE CHAIRMAN (SEN. AQUINO). Sorry, Mr. Chairman,
you’re referring to Section 13?
THE CHAIRMAN (REP. CUA). Yes.
THE CHAIRMAN (SEN. AQUINO). Actually, we just referred
to it. We are actually still on Section 5, the new Section 5.
THE CHAIRMAN (REP. CUA). We have additional on Section 5.
I mean, it’s an attachment.
THE CHAIRMAN (SEN. AQUINO). So, you are asking us to go
to Section 13 first?
THE CHAIRMAN (REP. CUA). To consider it jointly, Mr.
Chairman.
THE CHAIRMAN (SEN. AQUINO). Okay. So, you are
suggesting that we shall say “shall continue to”?
20
VOICE. [Off-mike] Prosecute.
THE CHAIRMAN (SEN. AQUINO). May I know why this was
suggested, Mr. Chairman?
REP. RODRIGUEZ. Yes. Because under our provision of
Section 23, House version, “The Commission in coordination with other
regulatory or appropriate”—This is on Page 47—“shall motu proprio or
upon the filing of a verified complaint of an interested party and so
forth, “initiate a preliminary inquiry”—If we have the investigation
retained by the DOJ and there’s also a preliminary inquiry powers of
the Commission, there will be two parallel investigations and which
would prevail or which would be the controlling factor in the filing of
cases. And that is why if you continue Section 23, it says here—on the
second to the last paragraph—“If the evidence so warrants, the
Commission may file criminal cases for violation of this Act…/cda
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BICAMERAL CONFERENCE COMMITTEE ON THE
DISAGREEING PROVISIONS OF SENATE BILL NO. 2282 AND
HOUSE BILL NO. 5286 (FAIR COMPETITION ACT OF 2015)
PLMANUEL IV-1 June 2, 2015 11:15 a.m. 1
REP. RODRIGUEZ. … for violation of this act or relevant thereto
before the DOJ.” That is why that is the time that the DOJ can now be
able to prosecute. If we have two investigating bodies of the same
act, that will not be good for both the law and for the
implementation of such law.
The jurisprudence, Mr. Chairman, in the case of the Baviera case
which was ruled by the Supreme Court, in the Securities Regulations
Code, there is this preliminary inquiry before you bring like SEC—
Securities fraud to the DOJ, you have to go first to the Securities
and Exchange Commission because that is the primary jurisdictional
body that will investigate before it will be sent to--
This is the concept of the House version that there will be-- the
inquiry by the commission will first be done, and then if evidence so
warrants for criminal penalties, it should now be filed in the DOJ. The
Supreme Court ruled that for the violation of the Securities
Regulations Code, you cannot go directly to the DOJ. You file your case
and complaint in the Securities and Exchange Commission. This is
similar to this.
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, I think
whether we will allow for a parallel action or not is still up for
22
discussion. So, this actually presupposes already that we have agreed
whether we will allow parallel action or not.
So, if you wish, we can skip Section 13. But in any case, maybe
we can already approve Section 5 and we can just work on Section 13
later on.
THE CHAIRMAN (REP. CUA). Mr. Chair, let’s just hear out
Cong XJ.
REP. ROMUALDO. Well, Mr. Chair, just a small proposal with
regard to Section 5, on the matter of the commission organizing within
60 days after the approval of the Act. We propose that “approval” be
changed to “effectivity” because “approval” is different. “Approval”
would mean the signing by the President. But then, it will still have,
you know, a period for publication before the Act takes effect. Just a
minor change to make use of the proper term, I suppose.
Thank you.
THE CHAIRMAN (SEN. AQUINO). We will accept that change,
Mr. Chairman. Of course, we are asking if we can already accept
Section 5.
THE CHAIRMAN (REP. CUA). We accept Section 5, as
amended, holding Section 13 at the moment.
23
THE CHAIRMAN (SEN. AQUINO). Okay.
So, we move to Section 6. And we will tackle the parallel action
question later on.
So, for Section 6, Mr. Chairman, we are suggesting--we are
proposing that we use the Senate version with the amendments,
instead of “associate commissioner” to just be “commissioner.” So,
delete “associate” and to add the word “equivalent” after the word
“rank.” It shall read as follows: “The Commission shall be composed
of a chairperson and four commissioners, the chairperson and
commissioners shall be citizens and residents of the Philippines, of
good moral character, of recognized probity and independence and
must have distinguished themselves professionally in public, civic or
academic service in any of the following fields: economics, law,
finance, commerce or engineering. They must have been in the active
practice of their profession for at least ten (10) years, and must not
have been candidates for any elective national or local office in the
immediately preceding elections, whether regular or special: Provided,
That at least one shall be a member of the Philippine Bar with at
least ten (10) years of experience in the active practice of law, and
at least one shall be an economist. The chairperson and the
24
commissioners who shall have the rank equivalent of Cabinet
secretary and undersecretary, respectively, shall be appointed by the
President.”
THE CHAIRMAN (REP. CUA). We accept.
THE CHAIRMAN (SEN. AQUINO). All right. So, we can move
on. Thank you.
Mr. Chairman, may we move to Section 7?
THE CHAIRMAN (SEN. AQUINO). All right.
Before we go on, there are a few changes that we are
proposing. But I think Senator Villar wish to raise concern on
reappointment.
SEN. VILLAR. I think 14 years is too long. So, we should limit
ourselves to seven years, no reappointment. There is no 14 years
anywhere.
REP. DEL ROSARIO. Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Yes.
REP. DEL ROSARIO. The proposal—the idea of the 14 years is
we are allowing a reappointment. So, a seven plus seven term,
reason being, Mr. Chairman, is because we felt that the government
25
would be spending substantially for the training of these
commissioners and chairmen. And we felt that retraining them a
new set after seven years would be costly for the government.
SEN. VILLAR. They come with their experience. It is stated
here they have practiced their profession for a long time. There is
no precedence of 14 years in any government post. Even the
President will only stay for six years. And any appointment is
always seven years, even Comelec, even those other big
appointments. So, we should limit it to seven years.
And I think there is no mention of more than seven years in
any of the version.
THE CHAIRMAN (SEN. AQUINO). Well, we can suspend for a
while and talk about this.
So, I propose a suspension, Mr. Chairman.
THE CHAIRMAN (REP. CUA). [Off-mike]
THE CHAIRMAN (SEN. AQUINO). No, to suspend for a while
just to talk among ourselves.
THE CHAIRMAN (REP. CUA). Okay, we agree. Suspended.
[THE MEETING WAS SUSPENDED AT 11:21 A.M.] /plm
26
HSGayapa V-1 June 2, 2015 11:25 a.m. 1
[THE HEARING WAS RESUMED AT 11:30 A.M.]
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, it seems we
cannot come into an agreement right now. So, I suggest we study this
further and just tackle this later on.
THE CHAIRMAN (REP. CUA). We agree.
THE CHAIRMAN (SEN. AQUINO). So, just for the record, we
skipped Section 3 of the Senate and the proposed Section 7 of our new
version which is “term of office.”
So, secretariat, if we can just note that we are parking this as well.
For Section 4 in the Senate and the proposed Section 8, Prohibition
and Disqualification, we propose that we adopt the Senate version with
the following changes: we insert the phrase “provided that the election
mentioned hereof is not a barangay election or sangguniang kabataan
election.” And this is just to differentiate that the election prohibition that
we both have in our versions will be for the major posts and not for the
barangay or sangguniang kabataan. We got word that this is used as a
loophole. So, we just wanted to clarify that.
And then we replace “or” with “nor” before the word “transact.”
And, again, this is just a cleaning up of wording. So, Section 8 will read
as follows: “Prohibition and disqualifications. The commissioner shall
27
not, during their tenure, hold any other office of employment. They shall
not, during their tenure, directly or indirectly practice any profession
except in a teaching capacity, participate in any business or be financially
interested in any contract with or any franchise or special privileges
granted by the government or any subdivision, agency or instrumentality
thereof, including government-owned and controlled corporations or their
subsidiaries. They shall strictly avoid conflict of interest in the conduct of
their office. They shall not be qualified to run for any office in the
election immediately succeeding their cessation from office, provided that
the election mentioned hereof is not a barangay election or a
sangguniang kabataan election. Provided they shall not be allowed to
appear or practice before the commission for two years following their
cessation from office. No spouse or relative by consanguinity or affinity
within the fourth civil degree of any of the commissioners, the
chairperson and the executive director of the commission may appear as
counsel or agent on any matter pending before the commission or
transact business directly or indirectly therein during incumbency and
within one year from cessation of office.”
That is our proposal, Mr. Chairman.
SEN. PIMENTEL. Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Yes, Senator Pimentel.
28
SEN. PIMENTEL. Just a little editing iyong “office of employment.”
I think that should be “or.”
Can we ask the secretariat to fix that?
SEN. PIMENTEL. “Shall not hold any other office or employment.”
THE CHAIRMAN (SEN. AQUINO). “Or employment,” yes. First
sentence.
Thank you, Senator Pimentel.
REP. ROMUALDO. Mr. Chair.
REP. ROMUALDO. Well, the House panel has a concern with
regard to prohibiting former members of the commission to appear or
practice before the commission for two years following the cessation from
their office. We feel the two years would be too long a period and it
would actually discourage, say, lawyers, for example, from, you know,
very good lawyers from accepting appointments to the commission
because once they retire from office, they would be barred from two
years of practice. So, we feel it would be too long and it would
discourage good people from, you know, accepting appointments to the
commission.
THE CHAIRMAN (SEN. AQUINO). To clarify…/hsg
29
Sglrobles VI-1 June 2, 2015 11:35 a.m. 1
THE CHAIRMAN (SEN. AQUINO). …To clarify, Mr. Chairman,
if I may ask Congressman Romualdo.
We are talking about appearing before the commission. They
can practice law after cessation from office. It’s just appearing before
the commission.
VOICE. They can appear as counsel?
SEN. SOTTO. As counsel in the commission. I think they can
practice law.
THE CHAIRMAN (SEN. AQUINO). Yes, they can practice law.
Just to clarify, the intent was not to bar them from being
lawyers.
REP. TINIO. Mr. Chair, perhaps the term “practice,” you know,
gives rise to certain ambiguity.
THE CHAIRMAN (SEN. AQUINO). Questions. We can just
say, “appear before the commission.” Yes. If that is acceptable, Mr.
Chairman.
REP. RODRIGUEZ. In the Code of Ethics the prohibition is only
for one year, from the time that you are severed from your position,
after one-year contract. This is a higher standard. If that is the wish
of the body, you know, but we are just concerned as lawyers that we
will be shut off from the commission for one year and I’m sure that
30
other agencies and other commissions, when you retire from that,
there is only a one-year prohibition under the Code of Conduct of
Ethics. So that is the concern of Congressman Romualdo.
THE CHAIRMAN (SEN. AQUINO). Yes, but we put two years,
Congressman, because this commission, as we know, should have the
highest standard and we also know that the cases being discussed
here will be in the billions so maybe a two-year prohibition from
practicing—before the commission, not practicing their profession, just
to clarify. So we are happy to accept Congressman Tinio’s suggestion.
SEN. PIMENTEL. Mr. Chairman, the version is clear. You said,
“to appear or practice before the commission.”
THE CHAIRMAN (SEN. AQUINO). Yes, but Congressman
Tinio, in my opinion, correctly pointed out that putting the word
“practice” there might be confusing. Anyway, it’s an “or” so we can
just say, “They shall not be allowed to appear before the commission.”
SEN. PIMENTEL. I think the original is better. If we are really
about fair competition, that lawyer will understand.
THE CHAIRMAN (SEN. AQUINO). What it means.
SEN. PIMENTEL. Yes, he should be fair to his brethren, allow
them to compete for the business of appearing before the commission.
Because, hindi ba, he formerly belonged to the commission so he has
31
an unfair advantage of contacts, etcetera. I think he will understand.
THE CHAIRMAN (SEN. AQUINO). Congressman Tinio,
anyway, we can state for the record what it means. So in a way, do
we mean that it is practicing their profession?
We actually put this as one of the easier provisions, huh, to my
colleagues. The other provisions are more contentious.
Yes, sir.
REP. RODRIGUEZ. In our version, it is one year. In your
version, it’s two years. So that’s why Congressman Romualdo is
saying that one year is enough to be able to have that break.
Sa Senate version, two years hindi maka-appear. Sa amin, one
year lang, following the Code of Ethics provisions.
SEN. PIMENTEL. So we go beyond the Code of Ethics. So I
think two years. And at the same time, since we’re talking about the
section, maybe we don’t need to mention Sangguniang Kabataan. The
law will read funny if we mention Sangguniang Kabataan because it’s
understood.
THE CHAIRMAN (SEN. AQUINO). Well, actually during our
pre-meeting, it was raised that this is sometimes used as a loophole
when we say that they cannot—
SEN. PIMENTEL. They cannot run. Someone who ran in a
32
Sangguniang Kabataan will not be qualified.
THE CHAIRMAN (REP. CUA). Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). No, no, that’s not the
meaning.
THE CHAIRMAN (REP. CUA). Mr. Chairman, if I may clarify.
SEN. PIMENTEL. Is this irrelative?
THE CHAIRMAN (REP. CUA). The spirit of this provision is
that the loophole is sometimes that if they are barred from running in
the next preceding election, they will claim that the next preceding
election is the SK election and thus allow them to run for the local or
national elections. So that is put in place to prohibit them from
running in the next local or national elections. That’s not for them to
run as SK but for them not to use the SK elections as a loophole. So
that’s the spirit of the proviso.
THE CHAIRMAN (SEN. AQUINO). Senator Pimentel, we were
trying to look for a term for the barangay and SK election but we
couldn’t find a term that would capture it both so we just mentioned it.
And my understanding is that this is used as a loophole with the
prohibitions on barring people from running in preceding elections.
SEN. PIMENTEL. I think we have to reword that portion
because it’s not clear. Because they shall not be qualified—
33
Mr. Chairman, correct me if I’m reading the incorrect version.
Ito iyong sentence, “They shall not be qualified to run for any office in
the election immediately succeeding their cessation from office.”
SEN. PIMENTEL. And then it is followed by this “Provided.”
THE CHAIRMAN (SEN. AQUINO). “Provided,” yes.
SEN. PIMENTEL. That the election mentioned hereof is not a
barangay election or a sangguniang kabataan election.
SEN. PIMENTEL. So it talks about the succeeding from
cessation of position, not the preceding?
THE CHAIRMAN (SEN. AQUINO). No, it’s succeeding. So I
cannot run for office in the next election. Now, the intent of the law is
that I cannot run for mayor, for congressman, for senator.
SEN. PIMENTEL. Yes.
THE CHAIRMAN (SEN. AQUINO). Yes. But if the next
succeeding election is a barangay election then, for example, I finish in
2015, there’s a barangay election in 2015 and a few months later I will
use that so that I can run in the next national or local election. And
the intent of the law is for you not to be able to run in the next local or
national election.
34
SEN. SOTTO. Mr. Chairman.
SEN. SOTTO. May I ask a question?
What is the difference between a national, a local and a
barangay election? Is a barangay election classified as a national or a
local election? Or is it merely barangay election as they call it?
REP. RODRIGUEZ. In the Article X on local government, it is a
local government so it is a local election.
SEN. SOTTO. So it’s called a local election.
REP. RODRIGUEZ. Yes, it is a local election. That’s why we
need to clarify.
THE CHAIRMAN (SEN. AQUINO). We will put local election.
SEN. SOTTO. Because otherwise, it would have been safer if
you just place that any national or local election.
THE CHAIRMAN (SEN. AQUINO). We went through that, Mr.
Minority Floor Leader, but we couldn’t find the distinction. That’s why
we named it instead.
We would be happy, Senator Pimentel, if you want to reword it.
But as long as we agree on the intent.
SEN. PIMENTEL. I just got confused, Mr. Chairman, because I
went back. So forward pala ito, forward. Okay.
35
So we have to—Yes, iyon lang iyon. Gagamitin nila na, “Okay,
hindi na nga ako tumakbo kasi pero barangay pala iyon.” And you
don’t want to count that, ano?
THE CHAIRMAN (SEN. AQUINO). Exactly.
SEN. PIMENTEL. Okay. So we have to—
THE CHAIRMAN (SEN. AQUINO). So are you withdrawing
your concern?
SEN. PIMENTEL. I get the point but—
THE CHAIRMAN (SEN. AQUINO). We are open to accepting
wording change or subject to style if you still wish to, but maybe we
can approve it in the meantime.
SEN. PIMENTEL. Oo.
THE CHAIRMAN (SEN. AQUINO). We still have the two years
though to discuss.
Yes, Congressman.
REP. TINIO. Well, actually, Mr. Chair, I would just like
clarification on the phrase “appear or practice before the commission.”
Since a distinction is made between “appearance” and “practice,” and
“practice” seems to be broader, now, is the intention here to prohibit
former commissioners from being involved in any way in cases
involving competition laws?
36
THE CHAIRMAN (SEN. AQUINO). Yes, sir. That is the intent.
REP. TINIO. Thank you, Mr. Chair.
In other words, the prohibition is not just that the former
commissioner will literally appear before the commission but it also
prohibits that former commissioner from, you know, acting behind the
scenes.
VOICE. Paano mo imo-monitor?
REP. TINIO. Well, the commissioner can ask for disclosure,
hindi ba, on who are involved?
REP. DEL ROSARIO. May I, Mr. Chair?
REP. DEL ROSARIO. I think the word “practice” here, the way
I understand it, refers only to defending a client.
VOICE. Yes.
REP. DEL ROSARIO. That’s how I understand “practice.” But
if I was a commissioner, a previous commissioner and, for example, in
the office of the subject entity being filed a case against, he can
consult me in my office. But for me to go in front of the commission to
defend him, that’s not allowed in this law, right? But he can consult
me in his office. That’s not in front of the commission.
THE CHAIRMAN (SEN. AQUINO). Well, let me state the
37
intent, okay. The intent, I think, is really to bar you from dealings with
the Commission…/sglr
38
ctsotto I-2 June 2, 2015 11:45 a.m. 1
THE CHAIRMAN (SEN. AQUINO). … dealings with the
commission. Because, of course, you can write the pleadings but you
won’t physically appear, then it’s the same. So I think the intent is
really to deal with your former office because you would be having
undue influence over your former colleagues. So maybe that’s why we
said “appear” or “practice” kasi practice is broader. That’s the intent.
I don’t know if you share the same conviction here but I think for two
years, you shouldn’t be allowed to work with your former office
because the cases will be highly contentious and you will have undue
influence over your colleagues, especially if you were a former
chairperson.
REP. GUTIERREZ. My problem, Mr. Chair, is not really with the
intention, it’s how you will enforce that. For example, after my term
as a member of the commission, I join a law firm. Does that
automatically mean that my entire law firm is now prohibited from
accepting as a client a person who has a case before the commission
on the theory that even if I don’t sign the pleading or even if I don’t
appear, then because it’s my law firm, then I suppose the assumption
is they are consulting me. So the thing there is how broad do we
construe the prohibition? Because it can be a prohibition that it
extend not only to the person of the former commissioner but to
everyone that he has dealings with. For example, if he accepts a
39
ctsotto I-2 June 2, 2015 11:45 a.m. 2
position as, let’s say, general corporate counsel of a corporation and
that corporation later on gets a complaint filed against it before the
commission. Does he have to resign as general corporate counsel
even if he doesn’t sign pleadings pertaining to the case specifically?
Those are the practical considerations, Mr. Chair.
THE CHAIRMAN (SEN. AQUINO). We understand the practical
considerations and, in fact, if we wish to make things more specific, we
would welcome suggestions. But I think the intent is really for you not
to be engaged with affairs of the commission. Anyway, if I am not
mistaken, lawyers now they’ll just disclose that they cannot and, of
course, you know, enforcement is another matter altogether. But if
they disclose that there is a prohibition and therefore, they cannot deal
with any dealings of the competition commission, then usually that’s
how they do it, there’s a disclosure.
Now, I also don’t think that a former commissioner or
chairperson should be a government corporate counsel of a
corporation, because that really will create a lot of conflict. Will we
park this again, Mr. Chairman? I am okay if you have suggestions on
how to further specify the concerns.
THE CHAIRMAN (REP. CUA). Well, Mr. Chairman, since we
are subjecting the SK election to refinement, we may as well park the
entire section.
40
ctsotto I-2 June 2, 2015 11:45 a.m. 3
On our end, Mr. Chairman, Senator Pimentel has committed to
reword. On your end, were you also committing to reword it with the
good senator, this issue on—?
THE CHAIRMAN (REP. CUA). Yes, we are open to refinement
of the language.
THE CHAIRMAN (SEN. AQUINO). Okay. Thank you.
Shall we go to Section 5, which is proposed Section 9 in the new
version, compensation and other emoluments for members and
personnel of the commission? We propose that we adopt the Senate
version.
But just to raise that and put on record only that we will be
defining “objective classification” in the IRR. The term was used and if
I am not mistaken, Congressman del Rosario raised this in a previous
meeting that we might need to define “objective classification.” So
this is Section 9—sorry, Section 5 of the Senate version which will be a
proposed Section 9, Compensation and Other Emoluments for
Members and Personnel of the Commission.
THE CHAIRMAN (REP. CUA). Yes, we accept.
THE CHAIRMAN (SEN. AQUINO). All right. Thank you very
much.
41
ctsotto I-2 June 2, 2015 11:45 a.m. 4
For Section 6, Quorum, which shall be the new Section 10, we
propose to accept the Senate version, Mr. Chairman.
THE CHAIRMAN (REP. CUA). Yes, we accept, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Thank you.
The Congress version has a letter (d), which is under this section
regarding where the commission shall hold office, and we propose that
we delete this section. There is no version in the Senate version.
THE CHAIRMAN (REP. CUA). We likewise accept.
THE CHAIRMAN (SEN. AQUINO). Thank you very much.
REP. DEL ROSARIO. Mr. Chairman, for as long as the office will
be in Tagum City, we accept.
THE CHAIRMAN (SEN. AQUINO). By deleting this letter, it
may be in Tagum. If we do not delete, it will be in Metro Manila.
Okay. We now go to—Mr. Chairman, if it’s okay with you,
Section 7 of the Senate version which will be a proposed Section 11.
And we propose to adopt the House version and just add “engineering”
after “commerce” And this is to rationalize all of the areas of study
that we wanted to highlight, for the commissioners and for the
executive director.
THE CHAIRMAN (REP. CUA). Yes, we accept, Mr. Chairman.
42
ctsotto I-2 June 2, 2015 11:45 a.m. 5
Section 8 is rather lengthy, so I might have to read everything.
But just to read into the record, that we are proposing that we
combine the Senate and the House of Representatives versions for
powers and functions of the commission. Although most are actually
similar in nature, but our proposal—maybe instead we can just read it
into the record, Mr. Chairman, if it’s okay with you. Because I think
we already made a hybrid of—let me just read the proposal.
Proposed Section 12. “Powers and Functions. The Commission
shall have original and primary jurisdiction over enforcement and
implementation of the provisions of this Act and its implementing rules
and regulations. The Commission shall exercise the following powers
and functions:
“(a) Conduct inquiry, investigate, and hear and decide on cases
involving any violation of this Act and other existing competition laws
motu proprio or upon receipt of a verified complaint from an interested
party or upon referral by the concerned regulatory agency and institute
the appropriate civil or criminal proceedings;
“(b) Monitor and undertake consultation with stakeholders and
affected agencies for the purpose of understanding market behavior;
“(c) Upon finding based on substantial evidence that an entity
has entered into an anti-competitive agreement or has abused its
dominant position after due notice and hearing, stop or redress the
43
ctsotto I-2 June 2, 2015 11:45 a.m. 6
same by applying remedies, such as but not limited to, imposition of
temporary price control, issuance of injunctions, requirement of
divestment and disgorgement of excess profits under such reasonable
parameters that shall be prescribed by the rules and regulations
implementing this Act;
“(d) Conduct administrative proceedings, impose sanctions,
fines or penalties for any non-compliance with or breach of this Act and
its implementing rules and regulations (IRR) and punish for contempt;
“(e) Issue subpoena duces tecum and subpoena ad testificandum
to require the production of books, records or other documents or data
which relate to any matter relevant to the investigation and personal
appearance before the commission; summon witnesses; administer
oaths; and issue interim orders such as show cause orders and cease
and desist orders after due notice and hearing in accordance with the
rules and regulations implementing this Act;
“(f) Upon order of the court, undertake inspections of business
premises and other offices, land and vehicles, as used by the entity,
where it reasonably suspects that relevant books, tax records or other
documents which relate to any matter relevant to the investigation are
kept in order to prevent the removal, concealment, tampering with or
destruction of the books, records or other documents;
44
ctsotto I-2 June 2, 2015 11:45 a.m. 7
“(g) Issue adjustment or divestiture orders including orders for
corporate reorganization or divestment in the manner and under such
terms and conditions as may be prescribed in the rules and regulations
implementing this Act. Adjustment or divestiture orders, which are
structural remedies, should only be imposed: (1) where there is no
equally effective behavioral remedy; or (2) where any equally effective
behavioral remedy would be more burdensome for the enterprise
concerned than the structural remedy. Changes to the structure of an
enterprise as it existed before the infringement was committed would
only be proportionate to the substantial risk of a lasting or repeated
infringement that derives from the very structure of the enterprise;
“(h) Deputize any and all enforcement agencies of the
government or enlist the aid and support of any private institution,
corporation …” cts
45
THE CHAIRMAN (SEN. AQUINO). “...corporation, entity or
association in the implementation of its powers and functions;
“(i) Monitor compliance by the person or entities concerned with
the cease and desist order or consent judgment;
“(j) Issue advisory opinions and guidelines for the effective
enforcement on competition matters and submit annual and special
reports to Congress, including proposed legislation for the regulation of
commerce, trade or industry;
“(k) Monitor and analyze the practice of competition in markets
that affect the Philippine economy; implement and oversee measures
to promote transparency and accountability; and ensure that
prohibitions and requirements of competition laws are adhered to;
“(l) Conduct, publish and disseminate studies and reports on
anti-competitive conduct and agreements to inform and guide the
industry and consumers;
“(m) Intervene or participate in administrative and regulatory
proceedings requiring consideration of the provisions of this Act that
are initiated by government agencies such as the Securities and
Exchange Commission, Energy Regulatory Commission and the
National Telecommunications Commission; and
46
“(n) Assist the National Economic and Development Authority, in
consultation with relevant agencies and sectors, in the preparation and
formulation of a national competition policy;
“(o) Act as the official representative of the Philippine
government in international competition matters, as may be necessary
and subject to the approval of the Office of the President;
“(p) Promote capacity building and sharing of best practices with
other competition related bodies;
“(q) advocate pro-competitive policies of the government by:
“(i) reviewing economic and administrative regulations motu
propio or upon request as to whether or not they adversely affect
relevant market competition and advising the concerned agencies
against such regulations; and
“(ii) advising the Executive branch on the competitive
implication of government actions, policies and programs; and
“(r) charge reasonable fees to defray the administrative cost of
the services rendered.”
And then we delete “and” here. So, we have (a) to (r),
gentlemen and lady, Powers and Functions. We now open the floor
for questions and discussions.
47
REP. DEL ROSARIO. Mr. Chairman, I have a couple of
refinements with regard to paragraph (j), we propose for the
paragraph to read as follows: “Issue advisory opinions and guidelines
on competition matters for the effective enforcement of this Act,” and
so on and so forth.
THE CHAIRMAN (SEN. AQUINO). ... “and submit annual and
special...”
REP. DEL ROSARIO. Yes.
THE CHAIRMAN (SEN. AQUINO). We will accept that.
REP. DEL ROSARIO. That is the first refinement.
The second refinement, Mr. Chair, in letter (o), paragraph (o),
we propose to end the paragraph with the word “necessary (period)”
therefore deleting “and subject to the approval of the Office of the
President.”
THE CHAIRMAN (SEN. AQUINO). We accept that.
REP. DEL ROSARIO. Thank you.
REP. RODRIGUEZ. Mr. Chairman, on Page 17—
THE CHAIRMAN (SEN. AQUINO). Congressman, can we refer
to the letter because we have different pagination, I think.
REP. RODRIGUEZ. Paragraph (c).
48
REP. RODRIGUEZ. It says here, “Upon finding based on
substantial evidence that the entity has entered into an anti-
competitive agreement or has abused its dominant position after due
notice and hearing, stop or redress the same by applying remedies,
such as but not limited to,” I would suggest that we remove
“imposition of temporary price controls.’ In other jurisdictions, there
is no—it’s an unusual regulatory power that the competitive
commission would be dealing into prices because this is a matter—
What they can do is to ask if there is proof of price fixing—you can ask
for injunction which will also include TRO but for them to be
computing the market forces and also the cost of producing goods,
that may not be very much attuned to the regulatory powers. So, I
would move that we therefore delete “imposition of temporary price
controls.”
THE CHAIRMAN (SEN. AQUINO). So, Congressman, just to
clarify, what we are talking about is we don’t want them to compute
and tell the corporation what price to sell.
REP. RODRIGUEZ. Yes, precisely that is not part. If there is
price fixing, injunction powers and TRO to stop them. But for them to
impose prices, I think that is of different concern. It should go to the
49
Consumer Code in terms of emergency and all the others that
pertains to other department.
THE CHAIRMAN (SEN. AQUINO). To clarify, if the current
injunction powers already gives them the power to stop a price
increase, that is included already in injunction.
REP. RODRIGUEZ. In injunction. Because, in fact, imposition
of price control, they are going to fix prices, controlled prices. So,
that is the meaning of this, to impose temporary price controls. So,
this is really a no-no in terms of regulation. Other departments will
do that.
THE CHAIRMAN (SEN. AQUINO). But, Congressman, we
agree that in issuance of injunctions, they have the power to stop a
price increase.
REP. RODRIGUEZ. That’s correct. Because that can be an
injunction that will include the TRO. The word always is injunction.
Injunction includes the prayer for TRO and they can do that when
there is price fixing, increase of price which are not—
THE CHAIRMAN (SEN. AQUINO). All right. We will accept
that.
REP. RODRIGUEZ. Thank you very much.
REP. DEL ROSARIO. Mr. Chairman.
50
REP. DEL ROSARIO. Mr. Chairman, just a typographical error
on Page 21, letter (m), delete the last word which is “and” in that
paragraph.
THE CHAIRMAN (SEN. AQUINO). Thank you. We accept, of
course.
SEN. PIMENTEL. Let me pursue the editing, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Please do so, Senator.
SEN. PIMENTEL. Before we go to the substance. Okay. In
sub-paragraph (e), we have semicolons there within the
subparagraphs, tatlong semicolons po iyan, maybe we can change all
of them to comma.
THE CHAIRMAN (SEN. AQUINO). Yes. We accept, Mr.
Senator.
SEN. PIMENTEL. And then—You already deleted the “and.”
And then letter (p), subparagraph (p) should end with a semicolon.
THE CHAIRMAN (SEN. AQUINO). Yes. We accept.
SEN. PIMENTEL. And then, now on a little substance, Mr.
Chairman.
THE CHAIRMAN (SEN. AQUINO). The panel accepts the style
changes. Maybe we can wait for them to accept the style changes.
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SEN. PIMENTEL. I am just pursuing the point of Congressman
del Rosario. He deleted the “and” after “(m).”
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman,
Congressman Cua, maybe we can accept the style changes of Senator.
THE CHAIRMAN (REP. CUA). Yes, accepted.
THE CHAIRMAN (SEN. AQUINO). Please go on, Senator
Pimentel.
SEN. PIMENTEL. And then on subparagraph (o) which has
been amended by the House panel, I just want to know the meaning of
the last phrase, “as may be necessary.” Why is that still necessary?
Why can we not designate the commission as the official
representative?
THE CHAIRMAN (SEN. AQUINO). Yeah. I am amenable to
deleting “as may be necessary” if the House is amenable.
SEN. SOTTO. Matters, period.
THE CHAIRMAN (SEN. AQUINO). Matters, semicolon.
Is that all, Senator Pimentel?
SEN. PIMENTEL. That will be all for now, Mr. Chairman.
52
REP. DEL ROSARIO. Mr. Chairman, actually there is one more
in letter (r), we delete the word “and” and replace the semicolon with
period. Letter (r), the last paragraph.
THE CHAIRMAN (SEN. AQUINO). We accept that it will be a
period. Yes.
THE CHAIRMAN (REP. CUA). So, let’s move on, Mr.
Chairman.
THE CHAIRMAN (SEN. AQUINO). Unless there is anything
else.
[INFORMAL DISCUSSION]
THE CHAIRMAN (SEN. AQUINO). Yes, I think we now go to
Section 13 which we were discussing earlier. Shall we skip this or do
you want to discuss the parallel action now, Mr. Chairman? Ayaw ko
muna.
THE CHAIRMAN (REP. CUA). Mr. Chairman, in light that we
have already discussed it partially earlier, maybe we can just go back
to it at a later time.
THE CHAIRMAN (SEN. AQUINO). Okay. So, we park Section
13.
Okay, we now go to Chapter III.../admasicap
53
CDAstrero III-2 June 2, 2015 12:05 p.m. 1
THE CHAIRMAN (SEN. AQUINO). …Okey, we now go to
Chapter III, Prohibited Acts, and this is Chapter II of the House
version. To be frank, there are some major differences between the
House version and the Senate version and your two chairmen have
been trying to harmonize the different standards by which we will be
considering Prohibited Acts.
So, we are suggesting that we park this in the meantime
because we want to present the consolidated version to the panels first
before we tackle this. So, I suggest that we skip, in the meantime,
Section 1, our Section 1…
THE CHAIRMAN (REP. CUA). We agree, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). …as well as Section 2 of
Chapter III. Sections 1 and 2 of Chapter III, we lay this on the table in
the meantime. And the two chairmen commit to present to the panel
a hybrid version of the consolidated version.
SEN. SOTTO. Does not include Chapter II(b)?
THE CHAIRMAN (SEN. AQUINO). Yes, the whole chapter.
SEN. SOTTO. Okay.
THE CHAIRMAN (SEN. AQUINO). For Chapter IV—
REP. RODRIGUEZ. Mr. Chairman…
54
REP. RODRIGUEZ. …appreciation of the issue. I think we can
discuss somehow…
THE CHAIRMAN (SEN. AQUINO). Briefly.
REP. RODRIGUEZ. …and then know what is on the table and
then probably have a decision later on.
THE CHAIRMAN (REP. CUA). Mr. Chairman, I would like to
subscribe to the proposal of Congressman Rodriguez in the sense that
we can perhaps do some preliminary discussion to give guidance as
well to the two chairmen of the proposed version.
THE CHAIRMAN (SEN. AQUINO). Please do so.
THE CHAIRMAN (REP. CUA). I open the discussion on items
Sections 1 and 2. If there are any from the House panel that would
like to discuss the disagreeing provisions?
THE CHAIRMAN (SEN. AQUINO). So, would you wish to give
description of the two versions, Mr. Chairman?
THE CHAIRMAN (REP. CUA). Mr. Chairman, members of the
panel of both chambers, it is, I think, apparent that there’s structural
differences in Section 1 of the Senate version and Section 5 of the
House version.
55
In the House version, there are Sections 5(a) and 5(b). 5(a) is a
listing of per se Prohibited Acts that constitute criminal prosecution
that, therefore, items under there—And on (b), it will be subject to rule
of reason while in the Senate version, there is only one enlisting of
anti-competitive agreements. The qualifier is that if it is done among
and between competitors, then it shall be criminally liable.
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, if I may
add?
THE CHAIRMAN (SEN. AQUINO). Primarily, the difference—
First of all, the structure is very different. But if we look at the intent
of the two laws, what we are outlawing or what we are prohibiting and
attaching a criminal offense is anti-competitive agreement is done
between and among competitors or basically a cartel. But when we
use the word “cartel” in the definition, it is used nonjudgmentally as in
group or you know—But we may actually change that down the line
because the general term “cartel”—A cartel doing these acts is what is
criminal in nature. Now, what is clear to the two versions is that that
type of behavior is illegal. So, at least, on that point, it is very clear
that it is illegal. One big difference is that for the Senate version, it
must substantially restrict or lessen competition. So, there is a rule of
56
reason. Meaning, there is a standard by which the Act is measured
against. While in the Congress version, it is a per se violation.
Now, the four acts that are mentioned there in our discussions
previously, I am willing to concede that bid rigging whether it does
substantially restrict competition or not can be a violation on its own
and I think Senator Guingona had that in the interpellations. So, we’re
willing to concede that. But the other two parts, which talked about
setting, limiting or controlling production, market, technical
development or investment and dividing our sharing the market
whether by volume or sales or purchases territory-type of goods or
services, buyers or sellers or any other means, our concern is that
without the rule of reason which points to these Acts limiting
competition, we might be outlawing Acts which are regularly done by
businesses.
So, in short, if I am setting or limiting or controlling production,
market, technical development or investment and I am a small player
and I’m doing this for efficiency, if I’m not restricting competition in
the market, I could actually be improving my business.
So, there’s a concern that without that rule of reason, we might
unnecessarily be making illegal some Acts which are not necessarily
illegal. So, that’s why we raise the concern that maybe for some, they
57
can be violations on their own but for others, they need to be under
the ambit of substantially restricting competition in the market. That’s
the major difference.
Now, to be frank to all of the members of the panels, I think
we’re quite close to an agreement already. It’s just really a matter of
restructuring. But this particular provision might have to be
restructured considering that there are differences and what we can
possibly agree on also.
So, do you want to further the discussion, Senator Guingona?
SEN. GUINGONA. [Off-mike] …another concept.
THE CHAIRMAN (SEN. AQUINO). Or Senator Pimentel, do
you want to add anything? Okay.
On your end, are there other points for discussion?
SEN. GUINGONA. Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Yes, Senator Guingona.
SEN. GUINGONA. So, I think it’s clear that the difference
between the House and the Senate panel is that in the House per se as
is, as long as you do it, it’s a violation. Here, in the Senate panel, it’s
subject to the rule of substantially preventing, restricting or lessening
competition.
58
The other thing I’d like to discuss also is that in the Senate
panel, we have a differentiation or a refinement of the term
“competitors.” The concept of a parent and a subsidiary. So, a parent
and a subsidiary are not competitors. I think we’re clear on that.
And the other concept is, how about the two subsidiaries
competing against each other but having the same parent? I submit
that that should also be considered as non-competitors.
THE CHAIRMAN (SEN. AQUINO). Senator Osmeña, what do
you think?
VOICE. Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). In any case, we are not
deciding right now but that’s taken for the record.
SEN. GUINGONA. Yeah, this is just for discussion.
THE CHAIRMAN (SEN. AQUINO). It’s for discussion.
VOICE. [Off-mike] Initial discussion.
REP. RODRIGUEZ. Yes. We have really adopted the rule in
many jurisdictions including the US and also in Europe that there is
really a—species of anti-competitive agreements that are really per se
by itself, by having that per se. It is really to be dealt with criminally.
And that is why there is always—we have adopted, therefore, per se.
59
For example, in the House version, once you restrict competition
as to price or components thereof, it’s really per se and then there will
be liability including dividing share in the market by itself and this is
borne from other jurisdictions that we have. And therefore, if you put
the proviso, rule of reason, unreasonably and substantially, there will
be a very, very big debate on that. And all lawyers can debate that
there is a reasonable agreement to fix prices or to have all of these.
Since we believe that many jurisdictions consider this per se, we might
as well give a message to everyone…/cda
60
PLMANUEL IV-2 June 2, 2015 12:15 p.m. 1
REP. RODRIGUEZ. … to give a message to everyone that at
least on these four acts of per se anti-competitive agreements, then
they should immediately be liable. Of course, there will always be a
hearing. And the hearing will always be conducted that there is no
price fixing, no division of the market. That is the reason why we—
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, since we
are open for discussion, if I may—
REP. RODRIGUEZ. Yes, please.
THE CHAIRMAN (SEN. AQUINO). So, we use the example. In
any case, you didn’t want to exempt the MSMEs. So, if there is an
example of five sari-sari stores saying that they will price their
Coca-Cola P3 higher, then they will be liable for six years
imprisonment. So, there is that possible absurdity in the law where if
it’s not under the standard of substantially restricting competition
and it’s a per se violation that they would be charged for the
violations here, it might also mean that the commission will be
inundated with so many cases where the intent clearly of the
competition commission is really talking about the market in
general.
So, my question is, in your case, that aspect where the five
sari-sari stores agree to sell their Coca-Cola for P3 higher, that is
61
price fixing among competitors. If it’s a per se violation, then they
would be liable under this Act—yes—and that is accepted by the
House panel, that case.
Yes.
REP. RODRIGUEZ. Certainly, we always have the commission
to have the preliminary investigation and factors like they are not
dominant, they are very small in a relevant market will not be.
Because anti-competition, in our case, pertains to relevant markets.
So, that is what we have.
THE CHAIRMAN (REP. CUA). Mr. Chairman, I’d like also to
point out that in the House version the criminal action may be given
a penalty of imprisonment or in terms of fines or combination of
both. So, that is upon the wisdom of the commission.
On the second hand, it also determines the impact on the
relevant market. So, the turnover of the sari-sari story would be in the
hundreds or in a few thousands of pesos which is not really that
significant. But then again, it’s up to the commission to determine
whether or not there is an actual case of abuse.
THE CHAIRMAN (SEN. AQUINO). There is an actual case
because as a special law, the provisions are the provisions. So, I
don’t think the commission can decide not to go through with the
case because it’s a small amount. We don’t have that differentiation
62
in our laws. So, they would actually go through that case and
eventually say, “Your turnover is P1,000 per day and we are
charging you 10 percent of that, we charge you P100.” But they
would be duty bound to go after these 10 sari-sari stores.
REP. RODRIGUEZ. To just give us some guide on this, the
Sherman Act of the United States precisely has a per se statement
or per se violations which the Supreme Court’s head in the United
States interpreting what is Section 5 (a) of the Sherman Act which
is the Anti-Trust Law. It says here that there are certain
agreements—this is the Supreme Court of the United States—there
are certain agreements or practices which because of their
pernicious effect on competition and lack of redeeming virtue
are conclusively presumed to be unreasonable and therefore illegal
without even elaborate an inquiry as to the precise harm they have
caused or the business excuse for their use. That is why this is the
per se violation which is put forward by acts in this case.
THE CHAIRMAN (SEN. AQUINO). Actually, Congressman, if I
may point out. The use of the word “unreasonable” points to rule of
reason. Meaning, the Supreme Court when judging that particular
case said that you have to look at reasonableness.
REP. RODRIGUEZ. In fact, no. The Supreme Court said that
they are conclusively presumed to be unreasonable. So, there is no
63
more defense of reasonableness because those particular acts are
conclusively presumed. It’s a conclusive presumption in law that it is
unreasonable and therefore illegal. That is why we have here the
per se violation because we have to really tell the whole world that
this particular--for us, there is no compromise here.
THE CHAIRMAN (SEN. AQUINO). Are prohibited.
REP. RODRIGUEZ. Are prohibited.
THE CHAIRMAN (SEN. AQUINO). That is taken into
consideration, Mr. Chairman.
Would my colleagues want to chime in on the per se versus
the rule of reason?
We would like to acknowledge Senator Angara.
You can stay here, Senator.
SEN. ANGARA. All right.
THE CHAIRMAN (SEN. AQUINO). Please.
SEN. PIEMENTEL. I could understand the ruling of the US
Supreme Court as explained to us by Congressman Rodriguez. Because
actually we are trying to influence behavior here, behavior, fair
competition. If you are a competitor in a market, no matter how
large or small, behavior—we want you to behave properly while you
64
are still small. Because once you become big, magkaroon ka ng
ugaling ganoon, madadala mo iyong ugali mong iyon.
So, from our discussion, I think one possible result of this
would be hybrid nga. We might have a chapter where we will
adopt a per se concept and then at the same time, some objective
test, more of a scientific to measure the reasonableness.
So I think we are going to that route, Mr. Chairman. So,
hintayin namin iyong new matrix of the Chair.
I think we really are committing to try to work this out
further and before the next bicam to present to the rest of the
panel. Because this is really the meat of the bill so we don’t want to—
ayaw nating madaliin ito.
And in true fairness to both panels, I think there is wisdom in
both but we just have to decide at some point.
So, if it’s okay, can we defer this?
REP. RODRIGUEZ. And, Mr. Chairman, just to follow up with
Honorable Guingona’s statement. Correct, we agree with Senator
Guingona that a parent or a subsidiary would not be competitors
because they are controlled by the parent or even subsidiaries
which may have different operations but under one.
65
Well, we agree with this. And we have a language to propose
which will cover all the situations, not only in parent subsidiary but all.
It will read like this, Mr. Chairman.
And the concept that commonly controlled entities are not
competitors and therefore cannot commit anti-competitive practice is
recognized in many jurisdictions. In fact, Item 23 of the UNCITRAL
Commentary states, “Agreements among enterprises are prohibited
in the set--except when dealing with each other in the context of
an economic entity wherein they are under common control and
including through ownership or otherwise not able to act independent
of each other.” And so these are also found in the Sherman Act and
the EO guidelines.
Now, this is the proposed amendment to include the parent, the
subsidiary. It will say that it will be a new letter (c) now after “(d)”
of the section on Prohibited Activities. It will say “An entity that
controls, is controlled by or is under common control with another
entity or entities that are otherwise not able to act independent of
each other shall not be considered as a competitor for purposes
of this chapter.”
I would so move that we have to clarify that those who are
with the same control have one controlling group and they belong to
the same group and they cannot be independent, we therefore
66
would say that that should be an exception to the competition
policy.
THE CHAIRMAN (SEN. AQUINO). Well, we don’t have the
exact wording in our version, Congressman. But with regard to parent
and all companies under its control, we do have a proviso on that.
REP. RODRIGUEZ. Yes.
THE CHAIRMAN (SEN. AQUINO). But I guess we can take
this up during the interim between the bicams and try to consolidate.
So, if it’s okay, we can move on, Mr. Chairman.
THE CHAIRMAN (REP. CUA). Yes, we appreciate all the
comments. But let’s park it for now, Mr. Chairman.
Mr. Chairman, that takes us to Chapter IV. The Senate version
is Chapter IV, Mergers and Acquisitions.
REP. RODRIGUEZ. How about the views of dominant position?
THE CHAIRMAN (SEN. AQUINO). I suggest we also—or you
want to discuss that?
REP. RODRIGUEZ. Yes, to guide everyone on how each panel
would be able to go forth.
THE CHAIRMAN (SEN. AQUINO). Okay. I withdraw my
motion. Let’s tackle or at least start the discussion on—this is
67
Section 2, potentially Section 15 of the new law, Abuse of Dominant
Position. Our Section 2.
REP. RODRIGUEZ. It’s Page 25.
THE CHAIRMAN (SEN. AQUINO). Chapter III.
Actually, there isn’t really much difference between the two
versions.
Mr. Chairman, if I’m not mistaken, we both have a … /plm
68
HSGayapa V-2 June 2, 2015 12:25 p.m. 1
THE CHAIRMAN (SEN. AQUINO). ...We both have a--It is
practically the same actually, Mr. Chairman, but we had raised some
concerns with regard to one of the provisos. Provided further, we
raised the concern with the second to the last “provided” which is
provided further in the interest of transparency in our pre-meetings,
we raised the concern with the term “reasonable commercial
justification” and the Senate panel feels that it is too big an exemption,
“reasonable commercial justification.” So, we would prefer if this is
actually fleshed out or if it is just taken out altogether. And specifically
we are referring to “Provided further, that the dominant entity’s
conduct shall not be considered an abuse of its position where the
commission finds that such conduct has a reasonable commercial
justification or represents a reasonable commercial response to the
entry or conduct of a competitor.” So, we find that this is a little too
broad, Mr. Chairman.
REP. RODRIGUEZ. So, Mr. Chairman, as far as the good faith
to meet the lower price of a competitor, this is all right with both
panels and we go to commercial justification?
THE CHAIRMAN (SEN. AQUINO). We actually have, Mr.
Chairman, our own provision on good faith and to be frank, we would
prefer our own provision. Again, Senator Sotto is not here but it is one
69
of the few amendments of the minority and we would really prefer our
language. But in essence, we do have a similar provision. So, we
think we can reconcile.
REP. RODRIGUEZ. On the good faith. Now, how about the
commercial--
THE CHAIRMAN (SEN. AQUINO). We do not have even the
term “commercial justification.”
Yes.
REP. ROMUALDO. Mr. Chair, to give the members of both
panels a background on where this comes from, well, the provision
comes from the Malaysian Competition Law and it is called “Meeting
the Competition Defense” which is based on European Union case law.
What it does is that it provides for a defense that companies, well,
dominant entities may use when they are faced with abuse of
dominance. Our concept is that it is not a blanket justification or a
catchall that can be claimed at any time but it is really just a defense
where the test is reasonableness and it must be alleged and supported
by sufficient evidence. What we would like to avoid is a situation
where a dominant entity is sued for abuse of dominance and then it is
unable to find--considering that this is the very, you know, there really
is no other competition jurisprudence or competition law in the
70
country, I mean, we would like to give them a defense that they can
use when they are sued but it is really not meant to be a catchall or a
justification but just to provide a test. When you are sued, you can
raise the defense of reasonableness. So, that is really the intent of the
provision, Mr. Chair.
REP. DEL ROSARIO. In addition to the statement made by
Congressman Romualdo, let us not forget that when you use the
defense of good faith, it is still up to the entity to prove good faith.
The burden of proof is with the business entity being questioned.
THE CHAIRMAN (SEN. AQUINO). I think one difference there,
Congressman Del Rosario, is that the good faith matching a competitor
in the market specifically is for setting prices. But this one is a proviso
for the whole section. Now, I think it would be--and this is just my
opinion and with all due respect, I think it would be a little irregular for
us to put the defense of possibly erring entity in the law. They can, of
course, use that defense and there is a rule of reason at least for this
provision. We all agree there is a rule of reason standard. So, maybe
we don’t need to state what that defense is in the law. I mean, it may
be stated in the IRR. In fact, I am sure our lawyers will eventually
come up with these defenses and cite jurisprudence from other
71
countries. But, again, we don’t have to finalize this now but the
Senate panel--our position is that it would be irregular to put the
defense of a company in the law. We are not saying it cannot be used.
We are just saying that it shouldn’t be here and also the term
“commercial justification” seems a little broad.
REP. RODRIGUEZ. That is why, Mr. Chairman, it is called
“justifiable commercial reasons” because you can sell below--this is
about selling below cost. And the reason for doing that is because--
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, this is a
mother proviso. We are not even tackling the--this comes out twice.
We are not tackling yet the one where we are talking about selling
below cost. We are talking about a mother proviso for all of the--
REP. RODRIGUEZ. Yes, this is under Section 6, paragraph (a),
selling of goods below cost. This is the proviso that is placed on selling
goods below cost.
THE CHAIRMAN (SEN. AQUINO). That is not the one we are
challenging yet, Mr. Chairman. We are challenging the “provided
further” which is at the end of the section.
REP. RODRIGUEZ. Yes, because, Mr. Chairman, for example,
closure of a business when you have to sell, you know, or, for
example, when you phase out a product. So, in other words, there has
72
to be acknowledgment that these things happen and that there should
be a justification that it will not be covered by the entire section.
THE CHAIRMAN (SEN. AQUINO). Congressman, we actually,
again, in the interest of transparency, if you want to name what these
justifications are, we may be willing to note it down. But a blanket
term “commercial justification,” again, we feel will be too broad. In
fact, we had suggested that we just say instead of including “but not
limited to” which, again, opens up the definition, we can say,
“reasonable commercial justification such as phasing out of a business
closure,” firstly is not to have the phrase “including but not limited to”
in letter (a) and then to delete the mother proviso at the end of the
section. So, that is our position currently.
REP. RODRIGUEZ. So, we will just go back to that.
THE CHAIRMAN (SEN. AQUINO). We can go back to that.
But we would like to state it for the record that that is our position.
REP. DEL ROSARIO. Mr. Chairman, if I may. Just for the
record also, the phrase “good faith” only shows up in paragraph (a).
So, it does not make reference to the entire Section 6.
REP. DEL ROSARIO. It is just paragraph (a) which is the
selling of goods and services below cost.
73
THE CHAIRMAN (REP. CUA). Okay. So, we agree to park, Mr.
Chairman, and move forward.
REP. RODRIGUEZ. I have some proposals for paragraph (b).
So, we are finished with (a). We have parked that. I have some
proposals for paragraph (b), Imposing Barriers to Entry.” Because, Mr.
Chairman, there are always natural and legal and permissive barriers
to entry that is why we would like to get a proviso here that says,
“Imposing barriers to entry, except those that developed in the market
as a result of or arising from a superior product or process.” So, these
are natural barriers to entry. And also by business acumen, we are
able to therefore have a reason that it could come in. We cannot
impose these barriers to entry. And also--
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, the
prohibition is on imposing barriers to entry.
REP. RODRIGUEZ. Yes. So, there is an exception that there
can be exception. So, it would read, “Imposing barriers to entry
except those that developed in the market as a result of or arising
from a superior product or process, business acumen or legal rights or
laws.” There are legal rights and laws that will prevent the imposition
of barriers to entry. So, just to recognize that.
74
REP. RODRIGUEZ. That cannot be an absolute imposition to
barriers to entry.
THE CHAIRMAN (SEN. AQUINO). We will tackle that, Mr.
Chairman. However, we do have another proviso and maybe our
request is we look at the proviso that we allowed which already says,
“We shall consider the structure of the market, degree of integration,
technological and financial advantages and other relevant factors
provided that any conduct which contributes to improving production
or distribution of goods or services, promoting technical, economic
progress while allowing consumers a fair share of the resulting
benefit.” We already have these provisos, Mr. Chairman. Maybe we
can analyze if that is folded into these provisos already.
REP. RODRIGUEZ. We just like to emphasize that there are
really some natural and legal permissive barriers to entry that a
company can do. When there are legal rights and laws that will allow
them…/hsg
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Sglrobles VI-2 June 2, 2015 12:35 p.m. 1
REP. RODRIGUEZ. …that will allow them. And then when also
there will be a result of superior products. So we can take that up
later on.
THE CHAIRMAN (SEN. AQUINO). Okay. All right, Mr.
Chairman, may we move on?
THE CHAIRMAN (REP. CUA). Yes, let’s move on.
THE CHAIRMAN (SEN. AQUINO). So we’re now at Chapter
IV. Mergers and Acquisitions.
REP. RODRIGUEZ. Before that, Mr. Chairman, we also have
some suggestions on “permissible franchising” because there is a
distinction between the Senate version and the House. The Senate
version merely states “Provided that nothing contains prohibit and
rendered unlawful, permissive franchising and so forth.” There is no
elaboration of that, where our version elaborates this by stating,
number one, “Permissible franchising, licensing or exclusive
distributorship agreement such as those which give each party the
right to unilaterally terminate the agreement.”
So these are kinds of permissible franchising agreements that
are there. So we want to be more detailed on this including the
agreements on protecting intellectual property rights and confidential
information or trade assets should be retained, that they are not
prohibited by the prohibited acts. So just clarification of what you
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have of having permissible franchising.
REP. RODRIGUEZ. We would like to have the House version
be accepted on the permissible franchising and agreements protecting
intellectual property rights, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Yes, we have committed to
work on the final wording, Mr. Chairman, but your comments are well-
taken.
REP. RODRIGUEZ. Thank you. Yes.
THE CHAIRMAN (SEN. AQUINO). Just a time check for
everyone. We’re okay to work through lunch, ‘no?
VOICES. Yes.
REP. RODRIGUEZ. There is also a distinction on the
paragraph, “Until the commission”—Page 28, Mr. Chairman. “Until the
Commission promulgates a different threshold.” Our version of the
House has three provisos if that can be retained, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Again, Mr. Chairman, we
thank you for the comments and we will discuss this further after the
session and before our next session. But all these suggestions are
well-taken.
So may we move to Chapter IV, unless there are objections?
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THE CHAIRMAN (REP. CUA). Yes, I think that’s the end of
the chapter, Mr. Chairman. Chapter IV.
THE CHAIRMAN (SEN. AQUINO). Yes. So Chapter IV is
“Mergers and Acquisitions.”
THE CHAIRMAN (SEN. AQUINO). The first section which is
“Review of Mergers and Acquisitions,” we are still trying to harmonize
this provision so we suggest that we park the proposed Section 16.
And it’s not really on the substance but really on the style because the
Senate panel finds it a little irregular that we refer to the Herfindahl-
Hirschman Index in the provision. I don’t think a law has ever referred
to any—
VOICE. Baka malaos ito.
THE CHAIRMAN (SEN. AQUINO). It might be changed in the
future. I know it is among others so it is not set in stone but, anyway,
substance-wise, we are not very far. It’s just that some of these lines
I think might be superfluous. So if we can park this in the meantime,
Mr. Chairman?
THE CHAIRMAN (REP. CUA). I agree, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). For proposed Section 17
which is our Section 2 and your Section 8, we are proposing that we
adopt the House of Representatives version with the amendment that
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we adopt the last paragraph of the Senate version.
THE CHAIRMAN (REP. CUA). Nasaan ka na ba?
THE CHAIRMAN (SEN. AQUINO). Page 30 for our matrix.
“Compulsory notification.”
So the difference here is that the Congress version has an initial
one billion notification threshold which may be changed by the
Commission as they do their operations.
So we are agreeing to this because it’s a more definite threshold.
And in any case, we also allow the Commission to determine the
threshold down the line.
And please take note that we are proposing that we adopt the
last paragraph of the Senate version which starts with, “In the case of
the merger of acquisition of banks.”
[Informal Discussion]
THE CHAIRMAN (REP. CUA). Mr. Chairman, so is it—
THE CHAIRMAN (REP. CUA). …the spirit of this proviso that
entity concerned shall seek the approval of both the Commission and
likewise the specific sector regulator?
THE CHAIRMAN (SEN. AQUINO). May you point which
paragraph? Is that the last paragraph?
THE CHAIRMAN (REP. CUA). Yes. In the case of the merger
79
or acquisition of banks, banking institutions, building and loan
associations, trust companies, insurance companies, public utilities,
etcetera, a favorable or no-objection ruling by the Commission shall
not be construed as dispensing of the requirement for a favorable
recommendation by the appropriate government agency.
THE CHAIRMAN (SEN. AQUINO). Well, the reason for this is
because most regulators also have or some of them have a notification
provision but those notifications are not for competition purposes.
They are for other purposes that the regulators are responsible for.
So we just want it to make clear that when we talk about
notification for the commission, it only refers to the competition
commission’s notification. It’s not notification for—It’s not a blanket
notification. If I’m not mistaken, that was the meaning of that
safeguard.
REP. TINIO. Mr. Chair, could I just have clarification on the
last, the “Provided” in the Senate version? It reads as follows and I
can’t really make sense of it. “That the favorable recommendation by
such governmental agency that shall give rise to a disputable
presumption that the proposed merger or acquisition shall not be
violative of this Act.”
REP. TINIO. First of all, is there a typographical error here?
80
Because there are too many “thats.”
THE CHAIRMAN (SEN. AQUINO). I think the second “that”
should be deleted. Okay.
REP. TINIO. So first, maybe the Senate could clarify the text?
THE CHAIRMAN (SEN. AQUINO). Yes. Okay. So this
particularly refers to a government agency with a competition
mandate. And we’re only talking of two which is ERC, explicitly and
NPC, implicitly.
So what it says here is that if the companies notified them
already and they got a favorable recommendation, it shall give rise to
a disputable presumption. So, meaning, the Commission then needs
to dispute that that approval was wrong. So this saves the companies
from having to go through multiple competition notifications.
So the first proviso clarifies that this notification is just for
competition. However, there are government agencies with a similar
competition mandate. The Commission can, of course, still reject that
notification issue but an approval of a regulator…/sglr
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ctsotto I-3 June 2, 2015 12:45 p.m. 1
THE CHAIRMAN (SEN. AQUINO). … an approval of a
regulator who has a competition mandate gives rise to a disputable
presumption. So it’s not final. But at least it is a disputable
presumption.
Is that clear? I am sorry, Congressman, if that’s not your—
REP. TINIO. I understood, Mr. Senator. So that means we
should delete the “that” after “agency.”
REP. TINIO. That was really the classification I sought.
THE CHAIRMAN (SEN. AQUINO). We will accept that
suggestion.
Thank you.
THE CHAIRMAN (REP. CUA). Mr. Chairman, may I bring you
back to Page 31. I think during one of our meetings, we proposed that
we qualify information in the last paragraph, “Should the Commission
deem it necessary, it may request further information,” and to qualify
information, we lift from the Senate version “that are reasonably
necessary and directly relevant to the prohibition.”
THE CHAIRMAN (SEN. AQUINO). I am sorry, Mr. Chairman,
I am a little lost. What paragraph is that? It’s a very long section.
THE CHAIRMAN (REP. CUA). Page 31 on the fourth column,
last paragraph.
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ctsotto I-3 June 2, 2015 12:45 p.m. 2
THE CHAIRMAN (SEN. AQUINO). Okay, “Should the
commission …”
THE CHAIRMAN (REP. CUA). “Should the Commission deem
it necessary, it may request further information”, then you lift on the
first column of last paragraph, Senate version, “that are reasonably
necessary and are directly relevant to the prohibition.”
THE CHAIRMAN (SEN. AQUINO). Okay, we will agree to that.
THE CHAIRMAN (REP. CUA). Thank you.
REP. ROMUALDO. Mr. Chair.
REP. ROMUALDO. I would just like to—well, going back to the
matter raised by Congressman Tinio, so for example, when an agency,
let’s say, the NTC gives a favorable recommendation, then that would
mean that the competition commission would not have to review again
because—
THE CHAIRMAN (SEN. AQUINO). They may dispute it. They
may accept it also. They may accept it but they may dispute it.
REP. ROMUALDO. So they may or may not review it anymore.
REP. RODRIGUEZ. Yes, because disputable presumption is
contradistinguished to conclusive presumption. So this is not
conclusive. In other words, whatever is the recommendation of a no
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objection notice from the other agency will not bind the commission.
So they can even again say that they will not be still in violation.
SEN. PIMENTEL. That’s why I pointed out the word “shall”
because this “shall not” in the last portion also causes confusion. So
there is a disputable presumption now that the proposed merger or
acquisition is not violative of this Act.
THE CHAIRMAN (SEN. AQUINO). Now, if it went through a
government agency that has a competition mandate.
SEN. PIMENTEL. Yes. That the favorable recommendation by
such government agency shall—nakakuha siya ng favorable—shall give
rise to a disputable presumption that the proposed merger or
acquisition being reviewed is not violative of this Act. That’s why it’s
not “shall not.”
THE CHAIRMAN (SEN. AQUINO). Will not.
SEN. PIMENTEL. Shall not be.
THE CHAIRMAN (SEN. AQUINO). Will not be. I am sorry,
what do you mean?
SEN. PIMENTEL. Because that is the presumption now. The
presumption now is it’s “not.”
THE CHAIRMAN (SEN. AQUINO). Yes, so shall give rise.
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SEN. PIMENTEL. I am looking at the last “shall.” The “shall,”-
-“shall not be.” Are we talking about the same ano?
THE CHAIRMAN (SEN. AQUINO). Okay, could you state it?
Okay, we will agree to that. So if I may read it? “That the favorable
recommendation by such governmental agency shall give rise to a
disputable presumption that the proposed merger or acquisition is not
violative of this Act.”
Thank you. Thank you, Senator Pimentel for your diligence.
SEN. PIMENTEL. No, but my question is, if this is what we
want, why are we not just copying the mechanism in Section 79 of the
Corporation Code? The Commission, which is being created here is the
final authority to approve the merger and the acquisition?
THE CHAIRMAN (SEN. AQUINO). Yes, because their powers
are original and primary.
SEN. PIMENTEL. In a market determined to be reviewable, di
ba? So the SEC has a nice provision which we already mentioned
Section 79. Ang sabi ng SEC, if other agencies are regulating that
particular field, get the clearance from that agency, then submit to us,
then we will decide.
THE CHAIRMAN (SEN. AQUINO). No. But the difference
there, Mr. Senator, is that currently the competition mandate of
regulators is not as clearly defined as the requirements of the SEC and
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its other regulators. Because SEC is merely in terms of your—when
you’re created, when you’re selling or whatnot. In this case, the
competition mandate is not as clearly stated. Which is why we would
prefer to keep this second proviso. So I don’t know if that is a
satisfactory answer, Mr. Senator, but—could anyone else want to try
me there?
THE CHAIRMAN (REP. CUA). Mr. Chairman, let me first
accept the proposed rewording of the last paragraph.
THE CHAIRMAN (REP. CUA). So accepted.
SEN. PIMENTEL. Well, are we processing this section now
formally?
THE CHAIRMAN (SEN. AQUINO). Yes, we may.
SEN. PIMENTEL. Okay.
THE CHAIRMAN (SEN. AQUINO). Our suggestion again is to
keep the House version to add our last paragraph and then to change
the—to institute the changes that were suggested. So that’s our
current proposal, Mr. Senator, unless you would want to propose
something else.
The paragraph already envisions a scenario where there is a
favorable or no objection ruling by the commission. Tama?
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ctsotto I-3 June 2, 2015 12:45 p.m. 6
THE CHAIRMAN (SEN. AQUINO). For the second proviso,
that’s by the government agency.
SEN. PIMENTEL. No, no, teka muna. Dito muna tayo sa “in
the case of the merger or acquisition of banks,” etcetera, “a favorable
or no objection ruling by the Commission shall not be construed as
dispensing of the requirement for a favorable recommendation by the
appropriate government agency under Section 79 of the Corporation
Code.”
SEN. PIMENTEL. So—
THE CHAIRMAN (SEN. AQUINO). So meaning, you need to
apply for those rulings on your own. Now the reverse is also true. If
your agency has a competition mandate, it will give rise to a disputable
presumption but it’s not binding also.
SEN. PIMENTEL. Precisely, yan na nga ang nangyayari.
Because the process is reversible. They can get the government
agency’s opinion or clearance first, then go to the commission or they
could get the commission’s favorable or no objection ruling and then
get the other agency’s clearance.
THE CHAIRMAN (SEN. AQUINO). On a competition mandate.
SEN. PIMENTEL. Yes.
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THE CHAIRMAN (SEN. AQUINO). I don’t think it’s necessarily
baliktaran, Senator. The first one merely says that the no objection
here is only for matters of the competition commission. It does not
affect any of the other requirements. So I think that’s pretty clear.
The second one says, “but for those agencies with the
competition mandate who can technically also rule on competition, if
they give a no objection, it merely gives a disputable presumption. It
is not binding on the commission. So that’s the meaning of these
two—
SEN. PIMENTEL. So that should be captured by the phrase
“such governmental agency” because—I think that is not automatic
when a—
THE CHAIRMAN (SEN. AQUINO). Actually maybe “such” is
confusing because since it’s referring to the first one.
SEN. PIMENTEL. Mayroon kasing appropriate government
agency and then followed by such a governmental agency. If they are
not the same, we should be cleared that they are not the same.
REP. TINIO. And even “the,” “the favorable recommendation,”
maybe it should be “a.”
THE CHAIRMAN (SEN. AQUINO). Yes. “That a”—thank you
for doing this. “That a favorable recommendation by a governmental
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agency shall give rise to a disputable presumption that the proposed
merger or acquisition is not violative of this Act.”
SEN. PIMENTEL. Mr. Chairman, why not introduce yung
concept mo, “that a favorable recommendation by a government
agency with a competition mandate,” iyon ang sinabi mo.
THE CHAIRMAN (SEN. AQUINO). Okay. I am okay with
that. Is the Senate panel favorable to these changes?
If I may read it again? “Provided further that a favorable
recommendation by a governmental agency with a competition
mandate shall give rise to a disputable presumption …” cts
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ADMasicap II-3 June 2, 2015 12:55 p.m. 1
THE CHAIRMAN (SEN. AQUINO). “...to a disputable
presumption that the proposed merger acquisition is not violative of
this Act.”
If I may get the consensus from my colleagues?
THE CHAIRMAN (REP. CUA). Well, Mr. Chair, A is for Aquino
and A is for Angara.
THE CHAIRMAN (SEN. AQUINO). Okay, so okay?
THE CHAIRMAN (REP. CUA). Yes. We accept.
MR. GUTIERREZ. Mr. Chair, just a question on that point. So,
the favorable recommendation here refers to the favorable
recommendation under Section 79.
THE CHAIRMAN (SEN. AQUINO). No, it’s different.
It’s a governmental agency with a competition mandate.
MR. GUTIERREZ. Okay.
THE CHAIRMAN (SEN. AQUINO). Did we capture that?
MR. GUTIERREZ. Yes.
THE CHAIRMAN (SEN. AQUINO). Can we suspend for a
second?
[THE MEETING WAS SUSPENDED AT 12:56 P.M.]
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[THE MEETING WAS RESUMED AT 12:56 P.M.]
THE CHAIRMAN (SEN. AQUINO). May I clarify further? I
think there is a structural mistake. It shouldn’t be “provided.” Kasi
the “provided however” links to the previous. It should be a separate
paragraph. So, wala nang “that a.” “A favorable recommendation by
a governmental agency with a competition mandate shall give rise to
a...” so on and so forth.
May we continue or is there another issue, Congressman?
MR. GUTIERREZ. Well, I am a bit confused, Mr. Chair, I’m
sorry. My question now is since we are now separating the favorable
recommendation in the previous proviso from the issuance of a
favorable recommendation under Section 79, then my question is,
what will occasion the issuance of a favorable recommendation by
some other government agency?
THE CHAIRMAN (SEN. AQUINO). What ano?
MR. GUTIERREZ. What will be the occasion by which some
other agency will issue a favorable recommendation?
THE CHAIRMAN (SEN. AQUINO). Because there have been
current cases where competitors asked for approvals from
commissions from regulators with the competition mandate on their
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dealings. So, we are just saying that any approvals of those dealings
is not automatic for the commission. And their franchises actually
required them to notify their regulator. So, it just says that it is not
automatic.
Okay, can we move on? Thank you.
For proposed Section 17 which is our current Section 3 and your
Section 10, the proposal is to accept the Senate version.
which is our Section 4 and your Section 11, we propose to accept the
House version. It is actually the same. It’s very similar. It’s just
better stated.
THE CHAIRMAN (REP. CUA). Mr. Chairman, just due
diligence, under letter (a) of Section 18. Tama po ba iyong Section 8
of this Act?
THE CHAIRMAN (SEN. AQUINO). Yes. Can we ask the
secretariat to check if—obviously, it is not Section 8 anymore. It will
be another section.
What section is that, Secretariat?
Thank you, Chairman.
Does anyone have an answer.
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VOICE. 17.
THE CHAIRMAN (SEN. AQUINO). Yeah. Can we just leave
this subject to style? We know what it means.
THE CHAIRMAN (REP. CUA). Okay. We accept with…
which is Section 5 of our version and Section 9 of your version, we
propose to have the Senate version with the following amendments.
Delete the phrase “substantially related” before the word “goods.”
That’s it, Mr. Chairman.
So, Section 19 will read as follows. “Merger or acquisition
agreements that will prevent or substantially lessen competition in the
relevant market or in the market for goods and services as may be
determined by the Commission shall be prohibited.”
THE CHAIRMAN (REP. CUA). Yeah, we accept.
Mr. Chairman, I propose and we can discuss this also. Our
Section 6 and your Section 12 which will be the proposed Section 20,
there is still currently some disagreements between the two houses or
the two bodies, but if I may, one thing we have agreed on already is
that there seems to be some confusion with the term “permissible
merger and acquisition.” And just to explain further is that what this
93
actually has is exemptions to the prohibition. Exemptions to the
prohibited mergers and acquisition because by using the term
“permissible merger and acquisition,” we are saying ito lang iyong
puwede, which is not the intent of Section 6. It’s actually referring to
the previous section which are your prohibitions. So, just to be clear,
our Section 5 and your Section 9 refer to those mergers and
acquisitions which are prohibited. The next section refers to the
exemptions of those prohibited mergers and acquisitions. But we
used the term “permissible mergers and acquisitions” which created
the misconception that we’re only allowing these mergers and
acquisitions.
So, initially, we are proposing that we change the heading to be
Exemptions to the Prohibited Mergers and Acquisitions. So, just to
put it on the table but we also haven’t agreed on all of these points.
So, we are suggesting that we park this in the meantime.
REP. RODRIGUEZ. I will just state that the enumeration of the
House version has five particular activities that are not prohibited.
So, in the Senate version there are only two. So, we would wish that
we adopt the House version. That this will be clear that these are
exemptions to the prohibited mergers.
94
THE CHAIRMAN (SEN. AQUINO). Yes. But we have some
issue. Actually, if we look at the five, (a) and (b) are practically the
same, letter (a) is in our proviso. We have some issues with letters (c)
and (d) because primarily they are not prohibited. So, we are stating
allowed mergers and acquisitions. So, in short, I think letter (c ) and
(d) and, of course, we can tackle this later on—letters (c) and (d) are
more relevant if they are construed as permissible mergers and
acquisitions because they really are permissible mergers and
acquisitions. But if we agree that this is really an exemption to the
prohibited, the sense does not follow as much. So, we can tackle this
later on, Congressman.
REP. RODRIGUEZ. Yes, thank you.
REP. GUTIERREZ. Mr. Chair, just on this point. Just to be
reflected in the record since we have already agreed to park. My
understanding is that from the discussions in the House, the
enumeration under our Section 12 is actually based on the US—the
Clayton Act. This is actually almost a substantially similar
enumeration to that found under Section 18 (c) of the Clayton Act.
But, of course, given the explanation of the Senate panel Chair that
there might be no need to include (c) and (b), we will be open to
discussing this at a later…
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THE CHAIRMAN (SEN. AQUINO). Just so that it could be
reflected what the source of this enumeration.
REP. GUTIERREZ. Yes, yes.
THE CHAIRMAN (SEN. AQUINO). Actually, we can also check
that Congressman Gutierrez, but our understanding is that letter (c )
is actually an exemption from notification and not an exemption from
the prohibited mergers and acquisitions. So, anyway, we can
definitely tackle this later on.
Okay. So, for proposed Section 21, which is Burden of
Proof.../admasicap
96
THE CHAIRMAN (SEN. AQUINO). …Burden of Proof, your
Section 13 and our Section 7, we propose that the Senate version for
this section, Burden of Proof.
THE CHAIRMAN (REP. CUA). We accept, Mr. Chairman.
SEN. PIMENTEL. Because I’m really confused now.
So, exemption from review? What is this?
THE CHAIRMAN (SEN. AQUINO). Are we going back to the
previous section?
SEN. PIMENTEL. No. The essence of the section and the
previous ones, the burden of proof lies with the parties seeking the
exemption.
SEN. PIMENTEL. They want an exemption from the review?
THE CHAIRMAN (SEN. AQUINO). They want an exemption
from the…
SEN. PIMENTEL. Approval?
THE CHAIRMAN (SEN. AQUINO). …approval on the merger
and acquisition which has reached the threshold.
SEN. PIMENTEL. Yeah, okay. So, iyon.
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THE CHAIRMAN (SEN. AQUINO). Sorry, sorry, one second.
They want an exemption from the prohibition because we have
prohibited mergers and acquisitions. So, in short, two companies want
to merge and their merger will unduly restrict competition in the
market. And you’re applying for an exemption, the burden of proof is
on the parties who are applying for the exemption.
SEN. PIMENTEL. Yeah. Even the exempted mergers and
acquisitions will be approved by the Commission?
SEN. PIMENTEL. Yeah. Ganoon ang nangyari, right? Needs to
be approved by the Commission.
THE CHAIRMAN (SEN. AQUINO). Because there’s a
threshold, Senator. Because there’s a threshold. So, if you hit the
threshold, you have to notify the commission.
SEN. PIMENTEL. Iyon.
THE CHAIRMAN (SEN. AQUINO). The commission will then
notify you back if it is prohibited or not. Correct me if I’m wrong ano.
SEN. PIMENTEL. Yes, yes.
THE CHAIRMAN (SEN. AQUINO). You may then respond to
the Commission and say, “I don’t want to be part of the prohibited,
98
exempt me,” right? Now, we’re saying that the burden of proof is on
the parties who are seeking for that exemption.
SEN. PIMENTEL. And the end goal is that the commission will
now approve the merger and acquisition.
THE CHAIRMAN (SEN. AQUINO). The end goal of the party.
SEN. PIMENTEL. Yeah.
THE CHAIRMAN (SEN. AQUINO). But they may or may not
be approved.
SEN. PIMENTEL. Yes. That would be a possible result of the
exercise.
SEN. PIMENTEL. Thank you, Mr. Chairman.
So, I don’t recall if we adopted but we are proposing the Senate
version for proposed Section 21.
THE CHAIRMAN (SEN. AQUINO). We are ready at your
Section 13 and our Section 7, Burden of Proof.
We parked our Section 6 because we didn’t agree on the
enumeration. So, we are now on Burden of Proof where we proposed
the Senate version.
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THE CHAIRMAN (REP. CUA). Mr. Chairman, just to point out
that in the proposed word “language,” Section 6 shall be now Section
20?
THE CHAIRMAN (SEN. AQUINO). Yes. Yes, sir.
Thank you for that.
In fact, if I may make an omnibus motion to correct all of these
references subject to style.
Chairman.
THE CHAIRMAN (REP. CUA). We adopt the same.
THE CHAIRMAN (SEN. AQUINO). So, our Comsecs can just
figure it out.
So, can we move on?
VOICE. Yes.
THE CHAIRMAN (SEN. AQUINO). Was that adopted?
THE CHAIRMAN (SEN. AQUINO). We now go to Section 22,
the proposed Section 22, Non-contestable Acts.
Congress has no similar provision, so we would propose that we
adopt the Senate version.
REP. RODRIGUEZ. Although, Mr. Chairman, if it is secured by
fraud, certainly, that can be nullified anytime by the proper
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proceedings here. Because Section 8 says “general ruling” but
obtained by fraud is always a general provision against fraud…
REP. RODRIGUEZ. …that if there’s any fraud, we can go back
to—
THE CHAIRMAN (SEN. AQUINO). Do we need to state that
Congressman, or isn’t that an accepted principle that anything—
REP. RODRIGUEZ. Yeah. …to really have a Section 8 on Non-
contestable Acts. That’s why we did not—That’s why we had no similar
provision because anything secured by fraud in quasi-judicial bodies
and also in judicial bodies is always subject to annulment on the
ground of fraud.
THE CHAIRMAN (SEN. AQUINO). Actually, Congressman,
this is so that once companies have a favorable commission, they can
proceed accordingly. There’s no fear that six months later, the
commission will overturn their ruling. Of course, if there was fraud
involved, then—
But I’m asking if do we need to state that in the provision or
that’s an accepted principle naman, hindi ba?—that anything acquired
through fraud can be challenged.
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REP. RODRIGUEZ. In the presumption of regularity of the
decision of the Commission, then they already proceed and this is only
when there is a complaint that it was secured by fraud that there can
be a petition to question us.
THE CHAIRMAN (SEN. AQUINO). Yes. In fact, we have the
line “except when such ruling was obtained on the basis of false…” We
can even put “or fraud, false information, fraud or corruption.”
REP. RODRIGUEZ. It’s the same.
THE CHAIRMAN (SEN. AQUINO). It’s the same. So, we can
leave it?
REP. RODRIGUEZ. Okay. No problem.
SEN. PIMENTEL. What are we trying to achieve here, Mr.
Chairman?
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, we are
trying to achieve some regularity of business for the business
community such that when the commission decides already on a
particular matter that—
SEN. PIMENTEL. And the challenge is before the commission or
before courts?
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THE CHAIRMAN (SEN. AQUINO). The commission or the
commission itself will—
SEN. PIMENTEL. Hindi. Kasi approved na siya ng commission
so bakit—So, courts, hindi ba? I think this envisions a court challenge.
THE CHAIRMAN (SEN. AQUINO). But it also may be the case
that the commission membership changes.
SEN. PIMENTEL. Kaya nga that’s why we need to be clear here
kasi may not be challenged. So, kung before courts, meaning to say,
final na iyong ruling ng commission.
THE CHAIRMAN (SEN. AQUINO). The intent, Mr. Senator, is
the commission challenging its own previous decision, changing its
mind.
SEN. PIMENTEL. O kaya nga. So, I suggest that it’s not clear
as currently written. So, ayusin na lang.
THE CHAIRMAN (SEN. AQUINO). Okay. Can we suggest,
just to point to the fact that we are talking about the commission itself,
challenging itself?
SEN. PIMENTEL. Oo.
THE CHAIRMAN (SEN. AQUINO). Okay. Can we leave that
subject to style?
SEN. PIMENTEL. But is that necessary still?
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REP. RODRIGUEZ. I believe that both. Because even in the
second paragraph (b), in the case of merger acquisition agreements
that do not require prior classifications, well, there will be allegations
that they really need to have prior classification because they have one
billion. So, all of these are contestable, really. We cannot state an
uncontestable thing because when there is fraud, even how conclusive
it is, it will be questioned in the same commission.
SEN. PIMENTEL. Mr. Chairman, because it’s parang a motion
for reconsideration in the commission, this can be covered in the rules
of procedure of the commission.
SEN. PIMENTEL. Kasi quasi-judicial ito, hindi ba?
REP. RODRIGUEZ. Yeah.
SEN. PIMENTEL. There will be rules sa procedure nila. So, pati
iyong pagfa-file mo ng MR, the time limit of doing that can be found in
the rules of procedure.
THE CHAIRMAN (SEN. AQUINO). Are you proposing we just
delete this and leave it to the IRR?
SEN. PIMENTEL. Yeah, I see the point of Congressman
Rodriguez.
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REP. RODRIGUEZ. There’s no such thing as non-contestable
acts.
SEN. PIMENTEL. Mas dangerous if we put it in the law—it
might be—
THE CHAIRMAN (SEN. AQUINO). How about if we just
clarify?
If the wording is not satisfactory to the Senator, the intent here
is that the Commission cannot just easily change its mind and I think
it’s important that it’s there for the simple reason that you want
companies to go through the process, to have some level of certainty
that that process is a good process and that do not worry that after
three months, the Commission will then go back and say, “O, mali pala
iyong desisyon namin.” It’s really a legal certainty for the business
sector who go through the proper process.
Now, if that’s not clear with the way this is worded, we will
accept another wording.
SEN. PIMENTEL. Ako nga, we should be more worried about
court intervention. Kasi kung itong commission once they have
decided, I don’t think they will change their minds after a few months.
THE CHAIRMAN (SEN. AQUINO). There could be cases
where they could. The court will—
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SEN. PIMENTEL. There could be pero—
THE CHAIRMAN (SEN. AQUINO). I don’t know. May I solicit
a comment from the Vice Chairman of Trade and Commerce if this is a
business-related provision?
REP. DEL ROSARIO. Well, as far as my personal opinion, I
have to say it’s not in our version so I really don’t see the need for
including it.
REP. TINIO. Well, Mr. Chair, just to clarify, non-contestable
acts refer to the commission, that the commission cannot change its
mind. This does not refer to other parties questioning or challenging
mergers.
THE CHAIRMAN (SEN. AQUINO). Well, with other parties,
the commission will then have to decide whether they will hear it or
not. I see your point. Okay.
Can we just park this then if--It seems that…/cda
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PLMANUEL I-3 June 2, 2015 1:15 p.m. 1
THE CHAIRMAN (SEN. AQUINO). … It seems that I’m alone
here, Mr. Chair. Can we park it and discuss it later?
Yes.
SEN. ANGARA. Mr. Chair, just to--I might not be here when
you discuss it later. But I just like to state that if we do decide to
keep this provision, maybe we should state that the false information
which can serve as a basis for a later nullification or about-faced
by the commission, it must be on a substantial or material matter.
Because what if bank “A” acquires bank “B” and in the merger
documents it says that this bank was in Pasong Tamo pala. It was in
Paseo de Roxas. That is false information but it is not on a substantial
matter. So, it might give some kind of grounds for the commission
to act arbitrarily later.
I know we on the panel are kind of the same mindset that we
must encourage—must not unduly—that the goal is a level playing
field and not really to put too many roadblocks in the face of
business. So I think we should put that in case we do decide to
keep it, Mr. Chair.
THE CHAIRMAN (SEN. AQUINO). Thank you, Senator.
Yes, Minority Floor Leader.
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SEN. SOTTO. To include in your discussion later when you
finally discuss it after it’s tabled or after it’s parked. What is the
scenario that you are looking at if this is deleted? If this is not
here, what is the scenario that we’re looking at?
THE CHAIRMAN (SEN. AQUINO). Well, the scenario we are
looking at, Senator Sotto, is that two companies merge, they go
through proper process, the commission rules on it and then later
on, the commission—and of course, we are looking at all cases
where sometimes the commission can be captured or also corrupt,
they’ll go back to the companies and say “We are going to reopen
your case.” So, you know, what we ruled on already and you are
already in the middle of things, we’re gonna change our minds. Or if
there is a change in personnel and then that new set says even
though this was ruled on already, we will reopen your action that
went through the process of the commission.
So, this really is more as a safety that there is some level of
certainty if, you know, and we are asking business to subject
themselves to this law. But there’s some certainty on their part that
if a ruling is made, it’s made. Because if not, that’s like a sort of
Damocles over them forever. So, that’s the intent here. But, you
108
know, obviously, if we can discuss it later if there seems to be no
support, then we can discuss that.
REP. TINIO. No, Mr. Chair. Yes, I would like clarification on
the intention as well. It seems from your explanation that this
prohibition would apply only to the commission itself. But what
about third parties or, you know, citizen coming into information
that, well, apparently, that merger was based on a fraudulent
information.
THE CHAIRMAN (SEN. AQUINO). Well, we do have that
exception, that if there is fraud or false information, then it is still
contestable.
REP. TINIO. All right. Or for any other reason, you know, I
would like to challenge an approved merger. Then, does that
prohibition apply to—
THE CHAIRMAN (SEN. AQUINO). Yes, I think so. I think so.
REP. TINIO. Uh-huh.
REP. TINIO. And what about in the case of letter (b), in the
case of merger or acquisition agreements that do not require prior
notification a year after their establishment. So, within a year, the
commission can question a merger?
109
THE CHAIRMAN (SEN. AQUINO). After a year or within a
year.
REP. TINIO. Or within a year, the commission can question a
merger of those companies that fall below the threshold—the one
billion threshold.
REP. TINIO. But how would the commission become ….
because they are not notified?
THE CHAIRMAN (SEN. AQUINO). Actually, you know, this
might need further discussion. So, can we just park this in the
meantime? Or is it because everyone is hungry? I’m not too much
sure.
VOICES. We have eaten already.
THE CHAIRMAN (SEN. AQUINO). You have eaten already.
Okay. Ako na lang pala. Sige.
Can we park na lang, Mr. Chairman?
THE CHAIRMAN (REP. CUA). We’ll see if we need to continue
it.
THE CHAIRMAN (SEN. AQUINO). It’s all right. I have a lot of
reserves. Okay.
110
Can we go to proposed Section 23, Determination of Anti-
Competitive Agreement or Conduct. So, this is our Section 1 of
Chapter V and your Section 25. We are proposing to adopt the
Senate version with the following amendment, just add “agreement
or” before “conduct.” So, “in determining whether anti-competitive
agreements or conduct has been committed,” and then anywhere
that there’s “conduct” just add “agreement or,” and then adopt the
Senate version.
THE CHAIRMAN (SEN. AQUINO). Can we suspend for a
second—
THE CHAIRMAN (REP. CUA). Okay.
REP. RODRIGUEZ. Okay, we accept.
Section 2, Relevant Market. You don’t have a provision. This is
proposed Section 24. We proposed to adopt the Senate version.
REP. RODRIGUEZ. There is already a definition of “relevant
market” in the definition of terms. So, are we having another one
here, the factors in determining that relevant market?
111
THE CHAIRMAN (SEN. AQUINO). We are amenable to either
having it here or having it in the definition of terms. So, if you want
to park, we can park for the meantime.
THE CHAIRMAN (REP. CUA). It is understood, Mr. Chairman.
THE CHAIRMAN (REP. CUA). I think the wisdom of defining it
again is to give reference to the disposition of cases, determination
of anti-competitive conduct, to clarify it to the previous section—to
tie it with the previous section to clarify…
THE CHAIRMAN (SEN. AQUINO). Yes. It’s not a definition.
THE CHAIRMAN (REP. CUA). …the qualifications—
THE CHAIRMAN (SEN. AQUINO). I withdraw that. So, I
withdraw the proposal. And again, we propose to keep the Senate
version.
Yes.
THE CHAIRMAN (REP. CUA). I think we principally agreed on
that.
THE CHAIRMAN (SEN. AQUINO). Okay. Thank you. My
apologies.
For proposed Section 25 which is Market Dominant Position, we
propose to keep the Senate version which is our current Section 3.
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THE CHAIRMAN (REP. CUA). Mr. Chairman, it seems that it
is related to the Section 6 of House version which is currently parked.
THE CHAIRMAN (SEN. AQUINO). Okay. So, we can park
this?
THE CHAIRMAN (REP. CUA). So, maybe we can park it as
well.
So, just for the record, we are parking proposed Section 25,
Market Dominant Position because we will still tackle the definition
in the definition of terms, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). For proposed Section 26,
which is Forbearance, I propose that we park this because the DOJ
has given us proposed wording to improve this section. And as we
haven’t tackled this yet previously, I propose that we park this so
we can consider the DOJ opinion on forbearance. It’s a cleaning up
of the terminologies.
THE CHAIRMAN (SEN. AQUINO). Okay. So, we’ll park
Section 26.
I think we are running out of things to tackle, Mr. Chairman.
113
For fines and penalties, Mr. Chairman, and maybe we can
discuss this. This is up for discussion.
The current Senate version is veering towards absolute
numbers, while the Congress version is actually more on percentage
of turnover. So, currently, there is a disagreement here. I’m sure
we can find the compromised situation.
Maybe you would want to say a few words, Mr. Chairman.
THE CHAIRMAN (REP. CUA). Yes, Mr. Chairman.
The spirit of the House version is to make it a lasting piece of
legislation and not to be obsolete when after several years such as
some of the provisions of the Revised Penal Code has been obsolete.
And it has actually basis on the international best practices of the
other competition laws in the ASEAN such as Thailand … /plm
114
THE CHAIRMAN (REP. CUA). ...such as Thailand, I think,
and Singapore which has pegged the 10 percent--I’m sorry, not
Thailand, Vietnam and Singapore and Malaysia have pegged 10
percent as imposable fines. So, that is where we are at, Mr. Chairman,
and we hope that you can reconsider the position of Senate.
THE CHAIRMAN (SEN. AQUINO). Thank you, Mr. Chairman,
for that.
Again, we probably have to discuss this among the Senate panel.
So, if you can give us some time to discuss this.
REP. RODRIGUEZ. Mr. Chairman, while we have this, Mr.
Chairman, I am looking at the effect if we have the House version, a
chilling effect on business coming in because of the huge 5 to 10
percent that we have. And after seeing that yours is more calibrated,
there is a first offense, there is 50 million. So, businesses would
exactly know what will be their penalties. Now, we are in the process
of even having the economic cha-cha and we will be going to therefore
have investors to come. Now, if you say 10 percent of turnover, you
know, Singapore can afford not to have new FDIs because their FDI for
last year was US $48 billion. Well, we are US $6 billion. And so, we
therefore are just also saying that while we have this in our provision,
5 percent to 10 percent of total turnover which includes, if it is a
115
multinational, the turnover in the United States or in Europe, we might
not have any more investors here. That is why with due respect to the
Chairman, that has been the position, of course, of the House, as
approved. But upon a second look on this, we see that a more
calibrated and fixed amount would be better for our drive to have more
foreign direct investments in this country. That goes both to
administrative penalties and also criminal penalties because you have
fixed amounts, we have 5 to 10 percent. And probably--
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, I guess it is
really up for discussion among the panels. So, let us--
THE CHAIRMAN (REP. CUA). There is a reason why he is
seated beside me.
THE CHAIRMAN (SEN. AQUINO). Unless you agree already
with the Senate version.
REP. DEL ROSARIO. Mr. Chairman, may I?
Actually, both positions are valid and that is why in my mind I
think there is room to come up with a hybrid version. I am thinking
maybe that we can adopt, for example, the first offense of the Senate
version, possibly even the second offense of the Senate version. But
in the third offense, we can already adopt the House version, which is
substantially more than the second and first offense.
116
THE CHAIRMAN (SEN. AQUINO). That is very wise,
Congressman.
REP. DEL ROSARIO. At least it gives businessmen a chance to
not avoid the third offense.
THE CHAIRMAN (SEN. AQUINO). There is definite wisdom
coming from Davao, Mr. Chairman. My mother is from Davao as well.
REP. DEL ROSARIO. That is why I say, Mr. Chairman, the first
office should be in Tagum City. [Laughter]
THE CHAIRMAN (SEN. AQUINO). Yes. But if it is okay, Mr.
Chairman, give us some time to discuss this also among ourselves.
THE CHAIRMAN (REP. CUA). Yes, likewise, I think the House
panel has a lot to discuss as well on these terms.
So, we agree to park, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Are we parking the whole
chapter, Mr. Chairman or just letter (a)?
THE CHAIRMAN (REP. CUA). Just (a), Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Okay. Actually, Mr.
Chairman, I would request that we just skip the whole chapter, Mr.
Chairman. Anyway, it is just Section 1 and 2. And one of my co-
panelists has requested that they be present when this is discussed.
So, if we can just park this in the meantime.
117
THE CHAIRMAN (REP. CUA). We accede.
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, with regard
to Chapter VII and this was really the subject matter of our discussion
also last night, the whole Chapter VII which is your enforcement and
the DOJ is here with us, would depend on if we are accepting per se
your rule of reason. Because if we accept per se, the enforcement
sections will change. If we accept rule of reason, the enforcement
sections would change. So, I think we need to park this and in any
case, the DOJ is here to help us with regard to the procedural matters.
So, I think we really need to park Chapter VII in the meantime, Mr.
Chairman, pending our discussion on the prohibited acts.
THE CHAIRMAN (SEN. AQUINO). The lawyers will have a field
day with Chapter VII, Mr. Chairman.
There was even a suggestion, Mr. Chairman, that we leave
Chapter VII to the IRR but we can tackle it probably. [Laughter]
Procedural na itong Chapter VII.
May we go to Chapter VIII?
Our Chapter VIII which is “Other Provisions,” Mr. Chairman. In
our matrix, page 71, Section 33 for the House version, proposed
Section 47.
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Mr. Chairman, for statute of limitations, we propose to keep the
HOR version but delete the second paragraph which starts with “the
cause of action.”
THE CHAIRMAN (REP. CUA). Delete?
THE CHAIRMAN (SEN. AQUINO). Yes. Because if you
remember our discussion on this, there are already current procedural
rules when determining cause of action. We don’t need to change the
current rules. This puts another standard that is unique to the
competition law specifically that it accrues when the complainant
suffers an injury. If I am not mistaken, it is upon knowledge in most
other laws or--
REP. RODRIGUEZ. Yes, ... it is synonymous to a plaintiff being
injured because if there is nobody coming out, nobody has discovered-
-it is the discovery of the crime.
THE CHAIRMAN (SEN. AQUINO). So, the intent was not to
modify current rules.
REP. RODRIGUEZ. Yes. No, it is just really quite synonymous
to discovery of the crime. Because when you are a plaintiff, then a
crime has been committed. Because if you just state “cause of action
accrues,” everybody is scot-free because they will say as a defense
that it happened 10 years ago, 7 years ago. So, it should be following
119
the Revised Penal Code of discovery of the offense, so, therefore, this
is just right, the plaintiff’s injury because he discovers that there is an
injury and anti-competitive agreement was done hurting him.
THE CHAIRMAN (SEN. AQUINO). May I ask, Congressman,
this whole second paragraph, is there anything that we are changing
with the current procedure?
REP. RODRIGUEZ. No. I think this is in consonance really with
our--that crimes would be, the prescription starts from discovery of the
crime, not when the crime occurs because nobody would know that.
REP. RODRIGUEZ. How can you make somebody liable when
he does not know the crime? What will you prescribe something that
was not known?
THE CHAIRMAN (SEN. AQUINO). In that case, Congressman,
maybe subject to style.
Can we just rationalize this with current wordings used in our
Rules of Court? Can we just harmonize it with--if the intent is not to
change anything anyway?
THE CHAIRMAN (REP. CUA). Yes, I think that is subject to
style.
120
THE CHAIRMAN (SEN. AQUINO). Okay. Well, anyway, we
will go back to it naman for final approval.
THE CHAIRMAN (SEN. AQUINO). But, again, for the record,
there was no intention to change the current rules.
REP. RODRIGUEZ. No.
THE CHAIRMAN (SEN. AQUINO). All right. Okay. The next
section will be affected.../hsg
121
THE CHAIRMAN (SEN. AQUINO). …will be affected by the
penalties so I suggest we skip proposed Section 48.
Okay. There is a Section 3 in the Senate version on intellectual
property rights as this is merely a restating of what is already
accepted. We are proposing to just delete it. Anyway, you don’t have
this version.
THE CHAIRMAN (REP. CUA). Section?
THE CHAIRMAN (SEN. AQUINO). Section 3 of the chapter.
It is merely a restating of the Republic Act No. 8293. So being a
restatement, we will just suggest to delete it.
THE CHAIRMAN (REP. CUA). We accept. Okay.
THE CHAIRMAN (SEN. AQUINO). For Section 49, Trade
Associations.
REP. RODRIGUEZ. Before that, what page is the intellectual
property right?
THE CHAIRMAN (SEN. AQUINO). Seventy-four. And,
actually, there’s no version in Congress.
THE CHAIRMAN (REP. CUA). It’s not harmful but it’s not
needed.
SEN. SOTTO. Mr. Chairman, the less wordings in a law, the
better.
122
THE CHAIRMAN (SEN. AQUINO). I agree, Mr. Chairman.
SEN. PIMENTEL. Unless we intend to achieve something.
What did we intend to achieve in—
THE CHAIRMAN (SEN. AQUINO). Initially, it was just a mere
statement of what is already there.
THE CHAIRMAN (SEN. AQUINO). So I’m proposing that this
be deleted, Mr. Chairman.
SEN. PIMENTEL. In that case, Mr. Chairman, I think it’s safe
to. It’s safe to delete it.
THE CHAIRMAN (SEN. AQUINO). And we have it,
Congressman Tinio is right. We do refer to this in another provision
regarding intellectual property rights, if I’m not mistaken, in the
confidential business information definition.
THE CHAIRMAN (REP. CUA). Okay. We accept.
For the proposed Section 49, Trade Associations, we propose to
keep the Senate version.
[Informal Discussion]
123
THE CHAIRMAN (SEN. AQUINO). Okay. It just clarifies what
is allowable, Mr. Chairman.
REP. RODRIGUEZ. Following Senator Sotto’s statement that
lesser words are better and precisely because we have so many
provisos here and our provision here in the House is very clear. It is
not prohibited, however, very clear that these associations shall not in
any way be used to justify any violation of this act. I think this covers
already all the other provisos.
THE CHAIRMAN (SEN. AQUINO). We will be okay to delete
the last “Provided further,” because I will admit it is redundant.
THE CHAIRMAN (SEN. AQUINO). But just for the safety of
our trade associations, I think it would be important to keep the
“Provided however,” so that the law will not be used to harass our
trade associations.
Anyway, it’s pretty clear what we allow, promote quality
standard, efficiency, safety, security.
REP. TINIO. Well, Mr. Chairman, if we keep the “Provided
however,” then we keep the “Provided further.”
THE CHAIRMAN (SEN. AQUINO). Ah, okay.
REP. TINIO. Just to be clear.
124
THE CHAIRMAN (SEN. AQUINO). To be clear. Okay.
What is the pleasure of the Congress panel?
For Section 50, you know, on your fifth hour of work, things
become easier to agree on ano? For Section 50—Okay, one second
more.
SEN. PIMENTEL. Just editing, Mr. Chairman.
THE CHAIRMAN (SEN. AQUINO). Yes, Senator.
SEN. PIMENTEL. Section 49, let’s replace the colons with
semi-colon.
THE CHAIRMAN (SEN. AQUINO). Okay. Thank you, Mr.
Senator.
The secretariat is instructed to adopt the suggestions.
SEN. PIMENTEL. We are still alert. [Laughter]
THE CHAIRMAN (SEN. AQUINO). Yes, it’s actually. We have
one and a half hours left before 3 o’clock so I think we will—We’re
actually going faster than we expected, to be very frank.
For Section 50, Congressional Oversight Committee, we propose
to adopt the House of Representatives version but to delete the sunset
clause which is the last paragraph.
125
THE CHAIRMAN (SEN. AQUINO). Okay. Final provisions,
Chapter IX.
Proposed Section 51, current Section 36 of the House and
current Section 1 of Chapter IX.
Mukha lang pong mabilis iyan. Marami tayong na-park actually.
Okay. Section 51, we propose to adopt the House version.
And may I clarify? There’s a difference here, at least for the
Senate panel. The difference is that in our version, we identified the
departments to make the IRR. The House version says that it’s the
commission when they are appointed by the President to make the
IRR.
Well, your Chairman relented to the House because we felt that
the commission should have some level of authority and leeway to
determine their IRR because you don’t want to have a situation where
other people make your IRR and you end up shackled by your own IRR
that’s why we agreed to the House version, unless there are issues
that we want to raise.
SEN. PIMENTEL. Section 51 na tayo ano?
126
SEN. PIMENTEL. Proposed Section 51. Who are these
concerned sector regulators? Are these identified already?
THE CHAIRMAN (SEN. AQUINO). That would be definitely
ERC, maybe probably NTC, maybe SEC also. To a certain extent,
maybe BSP also.
SEN. PIMENTEL. So who will be inviting them? Who will be
taking the lead in calling for the meeting to tackle the IRR and who to
invite?
THE CHAIRMAN (SEN. AQUINO). The commission, the DOJ-
OFC.
SEN. PIMENTEL. Kasi pantay-pantay silang tatlo dito, the
commission, the DOJ, and the concerned sector.
REP. ROSARIO. Actually, Mr. Chairman,…
REP. ROSARIO. …I was just about to comment that maybe we
need to include or insert a phrase, “The commission in consultation
with the DOJ-OFC and concerned sector regulations,” because we need
to be clear that it is the commission that is taking the lead.
THE CHAIRMAN (SEN. AQUINO). Clear who is doing this.
Okay. I will accept that.
127
Senator Pimentel does that satisfy your concern?
SEN. PIMENTEL. Of course, the wisdom comes from Davao.
REP. ROSARIO. Very near Cagayan de Oro.
SEN. PIMENTEL. Take note, that’s Tagum City, not Davao
City.
THE CHAIRMAN (SEN. AQUINO). So we accept the
suggestion.
THE CHAIRMAN (REP. CUA). We likewise accept, Mr. Chair.
THE CHAIRMAN (SEN. AQUINO). Okay. Section 52.
THE CHAIRMAN (REP. CUA). Is there another concern?
REP. ROMUALDO. Yes, just a minor proposal. To change the
provision which reads, “Shall prepare the necessary implementing
rules.” I would just like to propose to change the word “prepare” to
“promulgate.” “Prepare” is like just preparing.
THE CHAIRMAN (REP. CUA). So “Promulgate” is the
suggested language.
THE CHAIRMAN (SEN. AQUINO). We accept.
THE CHAIRMAN (REP. CUA). Likewise accept.
THE CHAIRMAN (SEN. AQUINO). Section 52, we suggest the
Senate version which, of course, has the specific amount which is P300
million.
128
THE CHAIRMAN (REP. CUA). Walang “not limited to”?
THE CHAIRMAN (SEN. AQUINO). It’s up to your pleasure,
Mr. Chairman.
THE CHAIRMAN (REP. CUA). Actually, we accept.
THE CHAIRMAN (SEN. AQUINO). Okay. Thank you.
Section 53 which is transitional clause.
REP. TINIO. Before we move on, with regard to Section 52,
actually, in an earlier provision it was approved that the members of
the commission and the personnel of the competition commission shall
be exempted from the Salary Standardization Law. And for the
record…/sglr
129
ctsotto I-4 June 2, 2015 1:45 p.m. 1
REP. TINIO. … And for the record, I’d like to state my personal
position that I don’t agree with that. If this is the case, then this will
be the only government body that is totally exempt from SSL. Well,
okay. BSP ba exempted? Hindi ko alam yun. And SEC, okay.
There are exemptions but there’s a requirement for fiscal
autonomy. Meaning, that they generate any additional—they don’t get
from GAA. Their salaries which are not in accordance with the SSL are
not funded from GAA.
Hindi. No, not U.P. In the case of U.P., it will be funded from
their income.
But anyway, Mr. Chair, so, I just like—I mean, theoretically the
commissioners—the commission could set salaries and compensation
that can go beyond P300 million. That’s what I am saying.
THE CHAIRMAN (SEN. AQUINO). Well, of course, we know
that there will be multiple checks because this will also go to the GAA.
Right, hindi ba?
SEN. ANGARA. Yes.
THE CHAIRMAN (SEN. AQUINO). So we can still check it.
Obviously if somebody has exorbitant amount, it will be corrected. If
you want to suggest wordings, please, you can suggest.
Are we okay with this? At least that concern is noted, for the
record.
130
ctsotto I-4 June 2, 2015 1:45 p.m. 2
So we propose to adopt the Senate version, Mr. Chairman.
THE CHAIRMAN (REP. CUA). And we accept.
THE CHAIRMAN (SEN. AQUINO). Okay. So we now go to the
Transitional Clause. So this is a slight change from our version, to my
co-panelists.
The DTI actually requested that we hew towards the Congress
version where there is a two-year transitional clause, only because the
DTI in our previous meeting stated—Secretary Domingo stated that we
need to give time to the business sector to correct any possible
violations or contemplated violations that they may be doing. So his
suggestion was actually a little bit higher than two years but in that
meeting the Chairman and the legislators present sort of agreed to two
years.
So if there is no objection to that, I am proposing to my co-
panelist to accept the House version with the amendment that it be
two years but not from the IRR. It’s two years from the enactment of
the law—from the effectivity—sorry, thank you, thank you. From
effectivity, not enactment.
THE CHAIRMAN (REP. CUA). We accept that.
THE CHAIRMAN (SEN. AQUINO). May I give time for my
panelists to—because this is a change from our version.
131
ctsotto I-4 June 2, 2015 1:45 p.m. 3
THE CHAIRMAN (SEN. AQUINO). Two years. Okay, thank
you.
So we are keeping the House version. We are just changing that
the two years are from the effectivity of this Act and not of the IRR.
That is clear. That’s an amendment.
REP. RODRIGUEZ. Although normally it’s really from the IRR
because you’ll have a complete picture of the law and the
implementing rules and regulations, that’s why in most of these laws,
it’s from the IRR. So that each one will be appraised, not only of the
law, but also the implementing rules and regulations. There’s a lot of
details that will come out.
THE CHAIRMAN (SEN. AQUINO). Actually, Congressman, we
can agree to IRR if we will lessen the 180 days of the—because the
President will still have to appoint, plus 180 days, plus two years. We
could be looking at three years and beyond. So we just want this to be
enacted as soon as possible.
REP. RODRIGUEZ. Why not one year from IRR? Because it’s
very important that we will make everyone if possible … not only on
the law but the implementing rules and regulations. So gradually
complete—the reckoning point is always the IRR for a complete
knowledge of the regulated.
132
ctsotto I-4 June 2, 2015 1:45 p.m. 4
THE CHAIRMAN (SEN. AQUINO). So if you want to flat it
out—The concern, Congressman, is that some laws we didn’t have an
IRR made, or the IRR was purposely not constituted. And in this law,
as we know, is really important, so we are hoping to have a more sure
time frame which is—Is that from the record, Senator Angara, from
Ways and Means?-- So we would prefer for effectivity of this Act.
Okay. Mr. Chairman, okay naman daw. Two years from the
effectivity of this Act.
THE CHAIRMAN (REP. CUA). We accept. But may we hold
on to the same section?
We have another—sorry.
SEN. PIMENTEL. In the meantime that there’s a lull, same
observation as to the colons, change them to semi-colon.
THE CHAIRMAN (SEN. AQUINO). Yes. Secretariat, please.
We will start calling you the guru of style, on statutory
construction.
SEN. PIMENTEL. To make sure that we are still all awake.
133
ctsotto I-4 June 2, 2015 1:45 p.m. 5
I thank our co-panelists for staying. Thank you for—we’re on our
fourth hour already.
Mr. Chairman, may we know the pleasure of the Congress panel?
REP. DEL ROSARIO. Mr. Chairman, since we adopted the
House version with certain amendment, we would like to introduce
another amendment because the original House version had a section
on other unfair trade or business practices which was deleted.
REP. DEL ROSARIO. But unfortunately in this particular
section, that particular phrase was not deleted. So therefore, we
would like to propose that we delete the phrase “and other unfair trade
or business practices.” That’s it.
THE CHAIRMAN (SEN. AQUINO). We actually had the same
amendment, Mr. Chairman, so we do accept that.
REP. DEL ROSARIO. Thank you.
THE CHAIRMAN (REP. CUA). We likewise accept the styling
amendments.
THE CHAIRMAN (SEN. AQUINO). All right. So we now go to
proposed Section 55, Suppletory Application. This is your Section 40
and our Section 4. We propose to adopt the Senate version.
Section 40 of Congress, proposed Section 55.
134
ctsotto I-4 June 2, 2015 1:45 p.m. 6
THE CHAIRMAN (SEN. AQUINO). Proposed Section 55.
SEN. PIMENTEL. May I know what’s the purpose of this
section? Why do we need to state this? The Revised Penal Code
being suppletory in character.
THE CHAIRMAN (SEN. AQUINO). That’s a good question.
Maybe Congressman XJ can help us, when we say suppletory.
SEN. PIMENTEL. And other applicable laws because if the laws
are applicable, then they really apply.
THE CHAIRMAN (SEN. AQUINO). In the case of the wisdom
of Senator Sotto, we can actually delete this. This is actually not
needed. So we can delete it.
REP. ROMUALDO. And also, Mr. Chair, the Revised Penal Code
always apply in a suppletory manner for special concerns.
THE CHAIRMAN (SEN. AQUINO). So we are okay to delete
it, Mr. Chairman.
THE CHAIRMAN (REP. CUA). We likewise accept the deletion.
THE CHAIRMAN (SEN. AQUINO). Proposed Section 56,
Separability. We propose the Senate version.
THE CHAIRMAN (SEN. AQUINO). It’s the same.
Let me just note another matter, Mr. Chairman, and maybe this
can be up for discussion.
135
ctsotto I-4 June 2, 2015 1:45 p.m. 7
Currently there are six cases filed on Article 186. Now a concern
was raised that if we repeal Article 186, the six cases filed by the DOJ
OFC will be set free, because the law that they are charged on will be
repealed. At the same time, we have a transition period of two years.
So it’s not like they can be charged on the competition law as soon as
this is enacted. The concern was that … cts
136
THE CHAIRMAN (SEN. AQUINO). ...The concern was that the
current six cases will be set free. So, we are proposing not to be taken
up right now, but if your intent is the same, to craft a paragraph that
will say that the current cases already filed and in the—of course, I
am not a lawyer, so the proper terminologies need to be used will
continue even with the enactment of this law.
Well, we got a legal opinion from DOJ that it’s not anti-
constitutional but we can discuss it further. But our intent is that
they are not set free because we repealed 186. Do we agree with
that intent? And these are for the currently-- I think, if I am not
mistaken, the garlic cartels are being charged with this, the onion
cartels are being charged with 186.
REP. RODRIGUEZ. The rule is that, when a law is repealed
and it carries a penalty the entire crime is extinguished. I cannot see
how there can be an amendatory language that will allow to have
cases on a repealed section proceed. So it’s really if you will repeal
186, they will go scot-free and then there will be a big fall on this
bill then they will be charged when it takes effect two years from
effectivity.
THE CHAIRMAN (SEN. AQUINO). Can we have an exemption
from our transition period where if there are cases already filed then
the transition period is not in effect?
137
REP. TINIO. Sir, I am not a lawyer but what if the law amends
Article 186 instead of repealing it?
THE CHAIRMAN (SEN. AQUINO). Maybe our resident lawyers
can discuss this now. I don’t think I have enough knowledge to
discuss this matter.
SEN. PIMENTEL. So, actually, that is correct. That’s the idea
we are pursuing here. Because I am asking if the acts prohibited
under 186 are clearly also punishable under this law and the answer is
yes. So, let us not repeal expressly 186. Let us not repeal it
expressly in the law. Therefore, in effect, we will be having a new
law—
THE CHAIRMAN (SEN. AQUINO). Senator, one concern raised
was that if there are two laws on the same subject matter—I might be
wrong—you will always implement the lesser penalty. And the penalty
for 186 is just six months and one day to six years. That’s not
necessarily the case?
REP. GUTIERREZ. The decision what law to apply will be a
determination made by the prosecutor’s office. So, if there are two
laws in place, both of which cover the same act or omission, then it
will be the decision of the Department of Justice what law to apply.
They are not bound by a rule that it should be the crime with the
lesser penalty.
138
THE CHAIRMAN (SEN. AQUINO). Okay. In that case maybe
we can park this but we do agree that we don’t want the current cases
to be extinguished or—yeah. So, do we agree on that point? So, at
least now we can craft the proper terminologies. Anyway, on that note
can we also park the repealing clause because this probably will be
the subject matter of that?
THE CHAIRMAN (REP. CUA). Mr. Chairman, we accept both
proposals.
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, we propose
Section 58 to be the Senate version of the Effectivity Clause.
REP. GUTIERREZ. Mr. Chair.
REP. GUTIERREZ. It’s “and,” not “or”?
THE CHAIRMAN (SEN. AQUINO). What are we referring to,
Congressman?
REP. GUTIERREZ. Section 58. It’s the Official Gazette and in
at least two national newspapers.
THE CHAIRMAN (SEN. AQUINO). Can be “or”.
REP. GUTIERREZ. Because under Executive Order 200, it is
“or.”
THE CHAIRMAN (SEN. AQUINO). Yes. We accept that.
Thank you, Mr. Congressman, for pointing that out.
139
So, we are proposing the Senate version but “or,” “or at least
two national newspapers.”
REP. ROMUALDO. Mr. Chair. Just another question. Just a
concern with regard to the retroactivity provision. So, it states that,
“there shall be no retroactive effect with respect to contracts approved
or confirmed by the relevant sectoral regulatory agency.” Tapos that
would follow the general rule that—
THE CHAIRMAN (SEN. AQUINO). Contract sign-up.
REP. ROMUALDO. Yeah. It may give rise to the interpretation
that for those contracts, you know, executed prior to the effectiivity of
the law would be covered. So there would be kind of like
interpretation could be made that there could be like a look back,
there could be a retroactive effect if there is no sectoral agency
approval or confirmation.
Is that the interpretation then or is that just—is something that
is not intended?
THE CHAIRMAN (SEN. AQUINO). What do you propose,
Congressman?
REP. ROMUALDO. I think the general rule and the
understanding of the House panel, at least, is that there is no
retroactive effect. The law will not have any retroactive effect. But
the provision in the Senate version may give rise to the interpretation
140
that there actually is a retroactive effect for contracts that are not
approved or confirmed by sectoral regulatory agency.
THE CHAIRMAN (SEN. AQUINO). Okay. The distinction was
made it might create an unintended definition.
Would you propose another language, Mr. Congressman?
REP. ROMUALDO. Yes. Or we could just delete the entire
second sentence altogether.
THE CHAIRMAN (SEN. AQUINO). Yes. Well, the panel feels
that restating, although it is an accepted legal principle that there is no
retroactive effect to our laws. But just restating it, I think, at least in
our discussions, we felt that it is important to restate it.
But what would your proposal be, Congressman?
REP. ROMUALDO. Maybe we could remove the distinction and
with no retroactive effect, that the Act shall have no retroactive effect.
THE CHAIRMAN (SEN. AQUINO). Okay. We want to clarify.
When we say “no retroactive effect,” it means that I cannot charge on
a violation done before the effectivity of this Act. But if it is a
continuing act, of course, you can charge them. That’s clear to
everyone, right? Yes. That’s the intent. Okay. So, maybe you can
propose a wording here.
141
THE CHAIRMAN (REP. CUA). If its limited to no retroactive
effect, then why not just reword as is, that this law shall have no
retroactive effect.
SEN. PIMENTEL. That’s a given already.
REP. RODRIGUEZ. Mr. Chairman. The Revised Penal Code,
Mr. Chairman, provides that there is prospectivity of all penal laws,
not only Revised Penal Code. All penal laws are prospective. That is a
principle in the Revised Penal Code, also in the Constitution.
THE CHAIRMAN (SEN. AQUINO). What about administrative
fines? It is also not retroactive.
REP. RODRIGUEZ. Also, yes, not retroactive.
THE CHAIRMAN (REP. CUA). That’s debatable.
THE CHAIRMAN (SEN. AQUINO). No. I think that is one
reason here, that we are saying, from now on forward ito iyong bawal.
Dito ka puwedeng i-fine, dito ka puwedeng hulihin. So, I think the
intention was to be clear that admin and criminal previous to this
law—I mean, you can be charged on 186 for not repealing it outright,
but for this law, it should have a prospective effect on all but also
including administrative. I think that was the intent.
REP. RODRIGUEZ. You do not have a fine or penalty when
there is no law to a crime, nulla poena, nullum crimen sine lege. So,
these are really principles that are really. So, there is no penalty,
142
there is no crime. So that is why there can be no administrative fines
also.
THE CHAIRMAN (SEN. AQUINO). What was the suggestion?
REP. ROMUALDO. It’s just to delete the second sentence.
THE CHAIRMAN (SEN. AQUINO). Can we just suspend? I will
just confer with my colleagues?
143
THE CHAIRMAN (SEN. AQUINO). Mr. Chairman, we will
agree do the deletion.
THE CHAIRMAN (REP. CUA). We agree as well.
THE CHAIRMAN (SEN. AQUINO). I had to talk to the more
senior members of the panel to get some wisdom.
SEN. SOTTO. Naniniguro lang iyong proponent.
THE CHAIRMAN (SEN. AQUINO). Naniniguro lang.
So, we agree to delete “notwithstanding to act.” Okay.
So, we have actually done our first pass for the bill.
What’s the pleasure of the Congress panel?
We can actually reconvene at a later date since we have to work
on the parked items. Or do you wish to tackle other items that we had
parked?
I’m okay to pause and—Sorry.
What is the pleasure of the Congress panel?
THE CHAIRMAN (REP. CUA). Well, first, I think we can spend
a few more time but it doesn’t have to be through a formal—
THE CHAIRMAN (SEN. AQUINO). We can suspend already.
144
THE CHAIRMAN (REP. CUA). We can already suspend but
before we suspend, Mr. Chair, I think we should put on record the next
resumption.
SEN. SOTTO. Mr. Chair.
SEN. SOTTO. Mr. Chairman, may I suggest that in the earliest
possible time we get a copy of the clean version already.
THE CHAIRMAN (SEN. AQUINO). Yes, most definitely,
Minority Floor Leader.
SEN. SOTTO. Clean version na. Doon sa mga napag-agrihan
(agree) na, huwag nang isama iyong House and Senate versions. Iyon
na sana para mas madali natin i-tackle iyong mga naka-park.
THE CHAIRMAN (SEN. AQUINO). Definitely.
SEN. SOTTO. All right.
Thank you.
THE CHAIRMAN (SEN. AQUINO). We hope to have that out
by the end of the day.
Comsec, kaya?
At the end of day, we will produce the clean draft.
145
THE CHAIRMAN (SEN. AQUINO). So, may I know what the
pleasure of the Congress panel is for our day two?
THE CHAIRMAN (SEN. AQUINO). We can resume, Mr.
Chairman.
Mr. Chairman, just to state for the record our next bicam, the
second day of our bicam will be on Thursday, 12:00 noon to sawa, to
finish line hopefully.
REP. RODRIGUEZ. Mr. Chairman, we might have a BBL at 4:00
o’clock. So, we can just try to finish before 4:00 kasi there might be
extension of session.
THE CHAIRMAN (SEN. AQUINO). Okay. What I would
suggest is we can work today and tomorrow or, at least, our respective
staffs can work today and tomorrow so we can also be as fast on
Thursday. Hopefully, all of the ironed out or hybrid provisions can be
presented even before then so we can comment accordingly.
THE CHAIRMAN (REP. CUA). Mr. Chairman, may I articulate
the query of my colleagues in the House panel, if you are amenable to
coming over to the House of Representatives for the second day?
146
THE CHAIRMAN (SEN. AQUINO). I’m very amenable. I’m
not sure if my colleagues are amenable. I can even go to Quirino if
you want, Mr. Chairman. I want to finish this bill but I think my
colleagues have hearings also here. So, if it’s okay, we can keep the
tradition of being in the Senate for bicam.
THE CHAIRMAN (REP. CUA). All right.
THE CHAIRMAN (SEN. AQUINO). Thank you, thank you.
THE CHAIRMAN (SEN. AQUINO). And on the part of the
Senate panel, we suspend the bicameral conference.
THE CHAIRMAN (REP. CUA). On the part of the House panel,
we suspend the bicameral conference.
147

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Republic of the Philippines

CONGRESS OF THE PHILIPPINES

BICAMERAL CONFERENCE COMMITTEE

DATE : Tuesday, June 2, 2015

TIME : 10:30 a.m.

VENUE : Sen. Claro M. Recto Room

AGENDA : Disagreeing Provisions of Senate Bill

HON. PAOLO BENIGNO “BAM” AQUINO IV - Chairman

HON. DAKILA CARLO E. CUA - Chairman

Ms. Abigail R. Zurifa - Officer-in-Charge, Liaison

Ms. Siera Ferrer - O/S Aquino

Mr. Michael Caben - O/S Sotto

Mr. Arturo I. Mojica Jr. - Director III, Committee “C”

Mr. Francis Soriano - Office of Rep. Cua

HOUSE OF REPRESENTATIVES SECRETARIAT:

Ms. Jannalinna Alladas - Committee Secretary

(For complete list, please see attached Attendance Sheet.)

AT 10:45 A.M., HON. PAOLO BENIGNO “BAM”

THE CHAIRMAN (SEN. AQUINO). Magandang umaga.

First of all, we would like to welcome the Congress Panel and

agreeing to have the bicam here.

I’d like to acknowledge the members of my panel. Of course to

my right is the Minority Floor Leader, Senator Tito Sotto. Magandang

morning, Senator Cynthia. Magandang umaga. The other members of

Ejercito, if I am not mistaken. Yes? I am looking at my back, no one

Senator Ejercito is also part of the panel? Yes. So my

colleagues will be dropping in and they have full confidence in the

panel to push through with the bicam.

So let me just begin by saying that last night we actually had a

pre-meeting and Congressman Del Rosario raised that this is the

longest running bill currently filed in Congress. So I don’t know if

before your time, in the Eighth Congress. Were you already a

member in the Eighth Congress?

SEN. SOTTO. Before my time. I was in the Ninth Congress.

THE CHAIRMAN (SEN. AQUINO). So even before Senator

Sotto’s time. So this has been in the running for--maybe 20 years

we can actually find a common ground or even agree on which version

is better. So definitely we’ll be engaging on this process.

and lengthy, we don’t expect that we will be finished today. So as

our second day. So as much as possible we would want to go through

the provisions which are identical or even with minor changes.

So with that, let me turn over to our chairman of the House

Panel. Magandang umaga, Chairman Cua.

THE CHAIRMAN (REP. CUA). Thank you, Senator Bam

Dear senators, Senator Osmeña, Senator Sotto, Senator Villar,

on behalf of the House Panel, I would like to acknowledge and

introduce our members. In my extreme left is Congressman Barry

Gutierrez, and beside him is Congressman Antonio Tinio, and--for the

minority, yes. And also from the House Panel is Congressman XJ

Romualdo of Camiguin; Congressman--of course, beside me is the ever

to be here today. And, of course, to my right is our Congressman

Anthony del Rosario of Davao.

As Senator Bam has—as you correctly mentioned this is the

support for the passage of this legislation and we see it as a landmark

milestone for the Philippines, especially given the background of the

ASEAN Integration wherein the commission, once chartered by this

law, will play a pivotal role in the economic development of our

country. And so, we join you in coping to accomplish as much as we

provisions but come to an agreement so that we can have the best

version possible of this law.

So on the part of the House, we call this meeting to order.

THE CHAIRMAN (SEN. AQUINO). Yes and I’d like to correct

Senator Osmeña is part of our panel.

We’ve also agreed previously that we will have a closed bicam.