CONGRESSMAN ENRIQUE T. GARCIA, SECOND DISTRICT OF BATAAN, PETITIONER, VS. THE BOARD OF INVESTMENTS, THE DEPARTMENT OF TRADE AND INDUSTRY, BATAAN PETROCHEMICAL CORPORATION AND PI…

DISSENTING OPINION

MELENCIO-HERRERA, J.:

On 17 December 1987,
a group of Taiwanese investors, doing business under the name of Bataan Petrochemical Corporation (BPC), filed with the
Board of Investments (BOI) an application for
registration as a new export producer of petrochemicals.  The notice of application was duly published
in the Philippine Daily Inquirer on 21
December 1987.  The
application, as submitted, specified that the amount of the investment for the
establishment of a petrochemical complex in the Philippines
was $220 million and that the plant was to be located in Bataan using “naphta”
as feedstock.

On 14 January 1988,
after compliance with other legal requirements, the BOI approved the
application, and issued the corresponding Certificate of Registration on 24 February 1988.  BPC was accorded pioneer status and became
entitled to the incentives provided for in the Omnibus Investments Code.

In February 1989, BPC sought to amend its application by
proposing the change of plant site from Bataan
to Batangas and the feedstock from “naphta only” to “naphta
and/or LPG,” and increasing its investment to $320 million, making the
project the single biggest foreign investment in the Philippines
to date.

On 11 April 1989,
BPC formally asked the BOI for approval of the proposed amendments.  Petitioner, the legislative representative of
the Second District of Bataan, opposed the change of
the plant site in a privilege speech before Congress.  He also sent letters to the BOI and the
Department of Trade and Industry setting forth his objections to the
transfer.  In a hearing conducted by the
Senate Committee on Ways and Means, petitioner appeared and expounded on his
position.

On 25 May 1989,
the BOI approved the revisions to the
registered petrochemical project. 
Earlier, or on 21 May 1989,
citing Article 81 of the Omnibus Investments Code of 1987, the BOI denied
petitioner’s request for a copy of the revisions
submitted by the investors because the latter had declined to give their consent
to the disclosure.

On 27 May 1989,
a meeting was called by President Aquino in Malacanang to discuss the transfer of the project
site.  Present at the meeting were BOI
officials, the petitioner and the other Congressman from Bataan. 
Petitioner requested the President to reconsider the BOI decision
approving the transfer.  On 24 June 1989, the President again
called a meeting with the Bataan Congressmen, the
Governor, and the Mayors of the province. 
She asked the Bataan
officials to withdraw their objections to
the transfer of the plant site to Batangas, lest the
investors pack up and leave for,
after all, Batangas is also in the Philippines and
some of the
“downstream” industries
which would spring from a petrochemical complex may later be located in Bataan.  The Bataan officials agreed to drop their objections,
except for petitioner who instituted this Petition for Certiorari and
Prohibition before this Court (p.
11, Opposition by public
respondents).

In his Petition, petitioner alleges that the BOI committed grave abuse of discretion and denied
him due process when it approved, without a
hearing, the amendments
to the registration of the BPC petrochemical project; when it denied petitioner’s request for a copy of
the amendments; and when it approved the change of the plant site and feedstock
of the plant.

As stated in the majority opinion, the Court is not concerned
with the economic, social and political aspects of the case.

In ruling in favor of petitioner, the majority faults the BOI
with grave abuse of discretion and has ordered it (1) to publish the amended
application for registration; (2) to allow petitioner to have access to its
records on the original and amended applications for registration, excluding
trade secrets; and (3) to set for hearing petitioner’s opposition to the
amended application.

With all due respect,
I find no grave abuse of discretion on the
part of BOI, nor denial by it to petitioner of due process.

As regards publication, Article 54 of the Omnibus Investments
Code provides:

“Art. 54.  Publication
and Posting of Notices. – Immediately after the application has been given due
course by the Board, the Secretary of the Board or any official designated by
the Board shall require the applicant to publish the notice of the action of
the Board thereon at his expense
once in a newspaper of general circulation in the province or city where the applicant has its principal
office, and post copies of said notice in conspicuous places, in the office of
the Board or in the building
where said office is located;
setting forth in such copies the name of the applicant, the business in which
it is engaged or proposes to engage or invest, and such other data and
information as may be required by the Board. 
No approval or certificate shall be valid without the publication and
posting of notices as herein provided.” (Emphasis supplied)

Clearly, it is not
the application itself that is required to be published but notice of the
action of the Board plus the
specified data.  Thus, the Notice
Publication, which appeared in the Inquirer, simply read:

“Notice is hereby given that the application of BATAAN
PETROCHEMICAL CORPORATION x x x
for registration with the Board of Investments under Book I of the Omnibus
Investment Code of 1987, otherwise known as Executive Order No. 226 as new
export producer of ethylene, polyethylene and polypropylene has been officially
accepted on December 17, 1987 and is currently being processed.

“Any person with valid objections to or pertinent comments on the above–mentioned application may
file his/her comments/objections in writing with the BOI within one (1) week
from the date of this
publication.

“Let this notice be published at the expense of the applicant.

x
x x ”
(Annex “1,” Opposition).

Absent the requirement of publication of the application itself,
there should be no need either to publish the amendments to the
application.  The statement in the
majority opinion that the amended application is considered a new application
does not find support in the Omnibus Investments Code.  After all, the amendment did not change the
essence or nature of the petrochemical project but only the site and the
feedstock.

Specially significant, too, is the fact
that the confidentiality of applications is specifically provided for in the Omnibus Investments Code.  Thus:

“Art. 81. 
Confidentiality of Applications. – All applications and their supporting
documents filed under this Code shall be confidential and shall not be
disclosed to any person, except with the consent of the applicant or on orders of a court of competent jurisdiction.”

Considering that all applications and their supporting documents
are confidential and are not to be disclosed to any person, it follows that
amendments thereto should also be considered confidential and need no
publication.

Which brings us to the second part of the
majority disposition requiring BOI to allow petitioner to have access to its
records.

If BOI did not furnish petitioner with copy of the original
application and amendments thereto, it was because it had received a reply from
the project proponents “advising us not to release the subject documents in
view of the sensitive information
contained therein which includes the accumulation of the proponents’ business
experience and know-how” (Annex “O,” Petition).  No grave abuse of discretion can be
attributed to the BOI, therefore, for not acceding to petitioner’s request that
he be furnished with copies of the original application with its amendments and
attachments (Annex “K,” Petition).

Of course, pursuant to Article 81 of the Omnibus Investments
Code, the Court, as it does not now, can order the BOI to allow petitioner to
have access to its records on the original and amended applications for
registration.

There seems to be no longer any necessity therefor,
however.  Attached to public respondent’s
Opposition is BPC’s Position Paper, dated 10 April 1989, wherein BPC discoursed
on the significant benefits to be achieved by the transfer and why “using
LPG as alternative feedstock will be very advantageous to the project (Annex
“2,” Opposition).  In addition,
petitioner already has in his
possession:  (a) the approval by the BOI
of the BPC application for registration, which includes the pre–registration
and registration conditions (Annex “A,” Petition); (b) the
post–registration specific terms and conditions, which the BOI imposed for the
project (Annex “B,” ibid.); (c) the BPC letter to the BOI requesting approval of the amendment of its investment
application for registration for the establishment of a petrochemical complex
in the Philippines (Annex “F,” ibid.); and (d) the approval by
the BOI on 25 May 1989 of the revisions
to the project, subject to additional conditions (Annex “S,”
ibid.).  Moreover, in the Supplemental
Opposition filed by BPC it has attached a summary of the considerations that
guided it in proposing the amendments. 
Virtually all the data petitioner needs, therefore, are now of record.

The majority ruling also requires the BOI to set for hearing petitioner’s opposition to the amended
application so that he may present at such hearing all the evidence in his possession in support of his
opposition to the transfer of the site of the project to Batangas.

The Omnibus Investments Code, however, does not require the BOI
to hold hearings before approving applications for registration or amendments
thereto.  In fact, hearings would
contravene Codal provisions on confidentiality.  Article 7, paragraph 4, cited in the majority opinion neither
supports the necessity of hearings.  It
reads:

“Art. 7.  Powers and
Duties of the Board.

x  x  x

“(4) After due hearing, decide controversies concerning the
implementation of this Code that
may arise between registered enterprises or investors therein and government
agencies, within thirty (30) days after the controversy has been submitted for decision: 
x x x ”

In other words, due hearing is required only in connection with
controversies between registered enterprises or investors therein and government
agencies concerning the implementation of the Omnibus Investments Code.  It does not speak at all of a hearing on
applications for registration or amendments thereto.

Additionally, Article 34 of the Omnibus Investments Code, in
providing that applications not acted upon by the Board within twenty (20) days
from official acceptance thereof shall be considered automatically approved
implies that a hearing is not at all indispensable in the matter of
registration of enterprises.  The
intention of the law to make BOI proceedings non-adversarial and as expeditious
as possible consistent with the Codal policy to
encourage investments, is clearly discernible.

Besides, a hearing, as
ordained, will serve no practical purpose for petitioner has already fully
presented his case, the BOI has given it due consideration and has acted
accordingly.  This is concretely shown by
the following exchange of
communications:

(1) In his letter to the Secretary of Trade and Industry, who is
concurrently Chairman of the Board of Investments, petitioner “reiterate(d)” his “most vehement protest against
the maneuver to transfer the Bataan Petrochemical
project from Bataan to Batangas
which, if successful, would greatly
prejudice not only the people of Bataan, but more
importantly, our country and government” (Annex “E,” Petition);

(2) Petitioner’s letter, dated 2 May 1989, to the Secretary of
Trade and Industry protested the latter’s “official position that ‘The final choice (of site) is still with the proponent (the
Taiwanese), who would, in the final analysis, provide the funding or risk
capital for the project'” (Annex “J,” ibid.);

(3) Attached to said communication was petitioner’s letter, dated
24 April 1989, addressed to the Senate Committee on Ways and Means giving
fourteen (14) reasons why the project should not be transferred to Batangas (Annex “I,” ibid.);

(4) The reply-letter of the BOI to petitioner, dated 11 May 1989,
took exception to petitioner’s claim that the
BOI and the DTI, by not vigorously opposing the transfer, had violated
the Constitution, the Omnibus Investments Code and P.D. 949 as amended by PD
1803, and urged petitioner not to proceed with his planned court action as it
would only serve to “discourage foreign investors and derail efforts at
economic recovery” (Annex “M,” ibid.);

(5) Petitioner’s letter to the BOI of 16 May 1989 rebutted point
by point the arguments in the BOI letter of 11 May 1989 and argued that
“PD No. 949, as amended by P.D. No. 1803, as well as related issuances,
have chosen Bataan as the site of the petrochemical
project” (Annex “N,” ibid.);

(6) Petitioner’s letter to the BOI of 29 May 1989 formalized his
“motion for reconsideration of the BOI “decision” approving the
transfer of the project from Bataan to Batangas, and contended that President Aquino
had set it aside (Annex “P,” ibid.);

(7) Petitioner’s
follow-up letter to the BOI, dated 19 June 1989, claimed that the BOI decision
to approve the transfer of the project had, in effect, been reversed by the
President herself and that the BOI should “refrain from taking any step to
execute said defunct decision” (Annex “Q,” ibid.);

(8) In the BOI letter of 21 June 1989 to petitioner, the former
denied that there had been a reversal by the President of the BOI decision; and
that, as far as petitioner’s motion for reconsideration of the BOI decision is
concerned, “since you are not submitting any new cause of action for BOI to
reconsider its decision, we believe that we have sufficiently answered the
questions you have raised in your letter dated 2 May 1989, which has been
replied to by the Managing Head of the BOI on 11 May 1989″ (Annex
“R,” ibid.).

All told, there can be no question that petitioner has been fully
heard on his original petition to the BOI to disapprove the transfer of the project
site and on his motion for reconsideration. 
No further purpose will be served by setting petitioner’s opposition for
hearing.

Neither do I think that “affected communities” have a right to be
consulted, as opined by the majority. 
The provision pertinent thereto reads:

“Art. 33.  Application.
– Applications shall be filed with the Board, recorded in a registration book
and the date appearing therein and stamped on the application shall be
considered the date of official acceptance.

“Whenever necessary, the Board, through the People’s Economic
Councils, shall consult the communities affected on the acceptability of
locating the registered enterprise within their community.”

In other words, the requirement on consultation is qualified by
the phrase “whenever necessary.” The clear implication is that the BOI may
dispense with such consultations if it
believes that it can decide applications for registration by itself without
consultation.

In fine, it is my view that the BOI did not commit any grave abuse of discretion in approving the amendments to BPC’s application.  Nor had it failed to observe due process in approving the same without a formal hearing, petitioner having,
in fact, been fully heard.  The
matter of determining whether the transfer of the plant site and change of feedstock will be best for the project
and the country lies with the
BOI as the administrative body specifically tasked with such matters.  It is well-settled that absent a clear, manifest and grave abuse of
discretion amounting to want of
jurisdiction, the decision and findings of an administrative agency on matters
falling within its competence will not be disturbed by the Courts (Sagun vs. People’s Homesite and
Housing Corp. G.R. No. 44738,
June 22, 1988, 162 SCRA 411) as the same falls within that agency’s special
knowledge and expertise gained by it from handling the specific matters falling
under its jurisdiction (Mapa vs. Arroyo et al., G.R.
No. 78565, July 5, 1989).

I vote, therefore,
for the dismissal of the petition for lack of merit, which dismissal should be
immediately executory.  The holding of hearings will serve no purpose
other than unnecessarily delay the implementation of the Philippines’ biggest
foreign project, representing a major step towards industrialization.  Further delay can only produce a chilling
effect on foreign investments in the country.