PAGBABAGO

At the second hearing conducted last Monday, Feb. 12, by the Senate subcommittee on Constitutional Amendments chaired by Senator Juan Edgardo Angara, we (Dr. Bernardo Villegas, Atty. Rene Sarmiento and myself, framers of the 1987 Constitution), were requested to share our views on whether we should amend some economic provisions of the 1987 Constitution.

I was asked specifically to comment on Section 11 of Article XII (National Economy and Patrimony) which states, “No franchise, certificate, or any form of authorization for the operation of public utility shall be granted except to citizens of the Philippines or to corporations at least 60 per centum of whose capital is owned by said citizens, unless provided by law, nor shall such franchise or authorization by exclusive or for a longer period than 50 years…

Neither shall any such franchise or right be granted except under the condition that it shall be subject to amendment or repeal by Congress where the common good requires. The State shall encourage equity participation in utilities by the general public.

The participation of foreign interests in the governing body of any public utility enterprise shall be limited to their proportionate share in the capital, and all the executive and managing officers of such corporations must be citizens of the Philippines.”

I added the last section to read: “The management body of every corporation or association shall in all cases by controlled by citizens of the Philippines.” In the final voting of the Article on National Economy, there was a total of 29 votes and not a single dissenting vote.

The reason I added this last section was that time we introduced it, it may have appeared controversial as there was clapping and noise in the gallery.

Since almost every section in Article XII emphasized concepts as control or economy by Filipinos, encouragement of growth of Filipino talent and exploration and utilization of our resources by the latter, the desire of some members of our 1986 Constitutional Commission was that we could have increased the ratio to 66 2/3 or 75 percent .

This was the preference expressed by Commissioners Hilario Davide, Ed Garcia and a few others. Or that there was satisfaction over the inclusion of phrase which mandated that the management body consist of Filipino citizens.

That was 38 years ago and though the political climate had changed to more openness to foreign investments, there was still hesitancy in opening up to full ownership of vital industries like telecommunication, water and energy resources by foreign investors.

Research scholars and intellectual leaders like Naom Chomsky have underscored the important role that owners of telecommunication, fossil fuel, mining and other enterprises have played either through support or non-support of critical resource initiatives like climate change.

During Monday’s hearing, I shared the view that we retain the 60:40 ratio and not give full 100 percent ownership of our public utilities to foreign entities.

Perhaps at a time when there is greater trust in our government and politicians, we shall, like some of our neighboring countries, be more open to 100 percent foreign investment ownership.

Dr. Bernie Villegas who chaired the committee on National Economy and Patrimony noted that we have to solve our “scandalous” problem of poverty first. I share his view of need for amendment. I had noted earlier that there is a “constitutional moment” and this is not the time.

Atty. Rene Sarmiento noted that “altering portions of the Charter will be the spark that can start a prairie fire in succeeding amendments concerning political, judicial, social justice, and human rights provisions.”

The Joint Foreign Chambers if the Philippines (JFC) also believed that the removal of economic restrictions would facilitate increase of foreign investments in sectors where such investments is currently restricted. Julian Payne, president of the Canadian Chamber of Commerce understood a country’s duty to protect its national interest, but that for many countries, such interest was protected by legislation and executive action.

Former Senior Associate Justice Antonio Carpio noted that the Charter change movers blame full foreign ownership for the country’s lag in economic growth but that in fact we now have “one of the most liberal foreign investment laws” following the enactment last March 2022 of Republic Act 11659 which amended the Commonwealth-era Public Service Act.
Other sectors represented in the hearing were officials from Department of Finance and Trade and Industry, local business and members of the academe.

But as expressed by one, the task ahead of us is to address the “low hanging fruits,” – those that require urgent attention, and can be implemented easily and right away. These were “ease of doing business” and factors such as having to obtain several dozens of signatures for a contract.

I think that if we can address these critical issues, we can sit together and consider Charter change.

I myself, see a need. But the elements of right environment and time must be there. We must first address the many divides, the lack of consensus on critical areas, and the obstacles that we face in dealing with government. Too, we must address the basics – “ endemic poverty, and lack of trust between and among groups. By then, we shall be ready for Charter change.