House Resolution To Change Equity Restrictions Gaining Ground In Philippines
Sunday, September 14, 2008 09:14:38 PM

DAVAO CITY, Philippines (Mindanao Examiner / September 14, 2008) – A House resolution authored by Speaker Prospero Nograles that seeks to remove the equity provisions in the Constitution is steadily gaining ground with at least 108 congressmen now co-authoring the document which they hope would bring more job-generating investments in the Philippines.

Nograles said he aims to secure the signature of three-fourths of the members of the House of Representatives which he hopes would clarify differing interpretations on how to amend certain provisions of the Constitution.

“There are schools of thought that Congress can actually amend specific provisions of the Constitution without going through the process of charter change by way of the various methods provided under the Constitution. This has been one of the arguments of those who had opposed past efforts to amend the Constitution so we want to find out if this can be done,” Nograles said.

House Resolution 737 calls for the amendment of sections 2 and 3, Article 12 of the Constitution “to allow the acquisition by foreign corporations and associations and the transfer or conveyance thereto, of alienable public and private lands.”

Nograles explained that although the resolution, even if approved by majority members of the House of Representatives, is not binding but it can still serve as the basis of raising a point of Constitutional inquiry before the Supreme Court.

“If the Supreme Court says that Congress can enact laws that in effect will repeal specific provisions in the Constitution, we might be able to avoid this protracted legal and constitutional wrangling on how we can attune the Constitution to the new challenges confronting our country,” Nograles said.

Nograles said that he filed House Resolution 737 because of his frustration in finding solutions that would end the four decades of armed conflict in some parts of Mindanao which he said “is trapped in a chicken-and-egg situation.

He said that despite its natural wealth, fertile soil and a favorable climate, Mindanao has remained at the tail-end among the list of investment destinations in the Philippines because of the insurgency problem in the region.

“Many people are still poor in Mindanao because of the insurgency problem and we have an insurgency problem because there are no investments coming in to help the poor. We have been trapped into this kind of situation for long a time now and there’s nothing we can do about it just because of two provisions in the Constitution,” Nograles said.

Nograles pointed out that Mindanao can still become an investment destination if only Arab investments can come in to put up their businesses in the area. However, the equity restrictions in the Constitution have been the biggest barrier to this prospect of getting Arab investments to put up their businesses in Mindanao.

“Arab investments can be best situated in Mindanao because the insurgency problem in the region is mainly Muslim-related. I think that even members of the Moro Islamic Liberation Front and the Abu Sayyaf will not attack any Arab investment,” Nograles pointed out.

In filing the resolution, Nograles said that “sustaining and expanding the inflow of foreign investments in the country requires the implementation of strategic policies that can create and strengthen long term investor confidence.”

The resolution seeks to enable foreign corporations and associations to hold, acquire, and in any manner are granted the right to possess, own, utilize and development land in the country. It a strategic policy initiative that can encourage more long term foreign investments in the country as it fosters the environment for more dynamic and enduring engagement of foreign investors as stakeholders in the overall effort to enhance and accelerate the growth of the national economy, according to the resolution.

“Implementing this policy initiative shall not only encourage, facilitate and strengthen synergistic partnerships of Filipino entrepreneurs and foreign investors, but shall also catalyze conditions where the immense potential of our country’s vast land resources as development capital would be unleashed and harnessed to the fullest so as to create more and better opportunities for economic growth for the nation and the improvement of the quality of life of the greater number of Filipino people,” the resolution read.

And Section 2 of Article 12 of the Constitution provides that the exploration, development and utilization of natural resources should be in full control and supervision of the State, allowing only co-production, joint venture or production sharing agreements with a maximum of 60 percent equity in domestic or foreign ownership.