Public Service Act is constitutional, Salceda says

  The main proponent of the Public Service bill stood firm that the measure adheres to the 1987 Constitution and would break the monopoly in certain industries for the good of the public.

In a statement, Albay Representative Joey Salceda said the Supreme Court has released decisions that upheld the removal of industries previously considered public utilities.

For example, Salceda said in JG Summit Holdings, Inc. v. Court of Appeals, the Court upheld the removal of “shipyards” from the definition of “public utility.”

Likewise, the Court noted in National Power Corporation vs. Provincial Government of Bataan that: "...Power generation is no longer considered a public utility operation.”

House Bill No. 78 or the proposed New Public Service Act 78 has stirred debate among lawmakers as it will remove the limit on foreign ownership on certain industries.

The measure seeks to limit the definition of public utilities to electricity distribution and transmission, water and sewerage pipelines, air transportation, ports and airports, which will remain covered by the 60-40 ownership in favor of Filipinos.

Several industries will be removed from the category of public utility and would instead be classified as public services such as telecommunications system, wire/wireless communications system, and water supply and power, which could now be fully owned by foreigners.

Earlier, Albay Rep. Edcel Lagman said the bill is “fatally violative” of the Constitution as it provides that ownership, operation, control and management of public utilities is reserved to Filipino citizens or to corporations at least 60% of whose capital is owned by Filipinos.

He said there is no distinction between "public utility" and "public service" as the Supreme Court itself stated in a 2003 ruling that "public utility is engaged in public service" that provides "basic commodities and services indispensable to the interest of the general public."

"It is well-settled that public service is an indispensable attribute or element of a public utility, and the two are synonymous and interchangeable, so much so that there is no sound reason for making a distinction to justify defiance of the Constitution by allowing the non-compliance of 'public service' enterprises with the requirement of Filipino citizenship," he added.

Salceda said the bill should be presumed constitutional like every treaty, executive agreement or law.

“The burden of proof is on the petitioner to clearly demonstrate that the assailed statute is unconstitutional.  This is particularly so as regards economic regulations as opposed to statutes which infringe upon fundamental rights,” he said.
Salceda said there is a need to regulate natural monopolies in the interest of the public.

“While an industry may initially be considered a natural monopoly, it does not mean that it will remain so. Conditions may change such that a natural monopoly no longer exists,” he said.

He cited industries “that are no longer natural monopolies,” like cellular telephone networks, toll and local telephone services, land transportation, air transportation, maritime transportation, airports, supply of electricity and railway transport.
The bill has been approved on second reading at the House of Representatives.  A counterpart bill is pending at the Senate. —LDF, GMA News