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Manila Bulletin devider Philippines devider National devider PAL's new 50-year franchise gets penultimate House nod

PAL's new 50-year franchise gets penultimate House nod

Published Aug 24, 2026 09:10 pm

At A Glance

  • The House approves on second reading HB No. 10545, granting Philippine Airlines (PAL) a new 50‑year congressional franchise to replace its existing franchise under PD 1590.
  • Committee on Legislative Franchises Chairman Rep. Jeffrey Ferrer sponsored the measure, and highlighted PAL's role as the national flag carrier.
  • The bill sets compliance with CAB and CAAP regulations, authorizes use of government facilities, grants eminent domain powers, outlines a tax framework with exemptions, prohibits franchise transfer without Congress approval, and empowers the President to temporarily take over PAL facilities during emergencies.
The House of Representatives (left); PAL (MANILA BULLETIN, Facebook)
The House of Representatives (left); PAL (MANILA BULLETIN, Facebook)


The House of Representatives has approved on second reading Monday night, Aug. 24 a measure granting a new 50-year congressional franchise to the country's flag-carrier, Philippine Airlines (PAL).
House Bill (HB) No.10545, which seeks to essentially replace PAL's existing franchise under Presidential Decree (PD) No.1590, was passed during plenary session via simple voice vote (ayes vs. nayes).
Committee on Legislative Franchises Chairman Negros Occidental 4th district Rep. Jeffrey Ferrer sponsored the measure on the floor.
Ferrer said the panel members recognized the important role of PAL as the "national flag carrier".
“PAL serves routes that may not always be commercially attractive but are important in connecting our islands, our communities and our people. Its role therefore goes beyond business. PAL also performs as an important public service," he said.
Ferrer says the proposed 50-year franchise would provide the local airline the "certainty and confidence necessary to undertake long-term investments, modernize its fleets, expand its domestic and international routes, and develop the infrastructure and capabilities necessary to meet the country’s growing aviation needs".
“In turn, this stability can help fuel tourism, facilitate trade and commerce, and contribute to exclusive economic growth while reinforcing the Philippines' position as a competitive player in the international aviation industry,” the panel chairman added.
The measure was introduced by Ferrer, Deputy Speaker La Union 1st district Rep. Paolo Ortega V, Cagayan de Oro City 2nd district Rep. Rufus Rodriguez, ABAMIN Party-list Rep. Maximo Rodriguez, and Santa Rosa City lone district Rep. Roy Gonzales.
HB No. 10545, which could be approved on third and final reading as early as next week, requires PAL to comply with Civil Aeronautics Board (CAB) and Civil Aviatior Authority of the Philippines (CAAP) regulations on rates, safety, and technical standards.
It authorizes PAL to use government-owned landing and airport facilities, subject to national security considerations, and reciprocally allows government use of PAL facilities.
The measure allows PAL to employ foreign nationals with specialized expertise, subject to registration requirements.
The proposed stature further authorizes the flag-carrier to exercise eminent domain for landing facilities and hangar and other related structures, subject to law and just compensation.
It also provides a comprehensive tax framework, including exemptions on aviation fuel, aircraft importations, lease rentals, foreign loans, and related transactions while requiring payment of corporate income tax, value-added tax (VAT), and real property tax.
It prohibits transfer, sale, or assignment of the franchise without prior Congressional approval, with limited exceptions for capital raising and stock transactions.
Under HB No. 10545, the President of the Philippines has the authority to temporarily take over PAL's facilities during war, rebellion, calamity, or emergencies, with due compensation.
It holds PAL liable for accidents or injuries arising from its operations indemnifying national and local governments.

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PAL Franchise House of Representatives Second reading
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