Presidential Decree
No. 1722
CREATING
THE NATIONAL COAL AUTHORITY DEFINING ITS POWERS AND FUNCTIONS, PROVIDING FUNDS
THEREFOR, AND FOR OTHER PURPOSES
WHEREAS,
overriding considerations of national interest recognize energy
self-sufficiency as a national priority;
WHEREAS,
the accelerated coal development program is an important component of the
government’s thrust towards energy self-sufficiency;
WHEREAS, the utilization of coal as an alternate source of power for various industries necessities the assurance by the government of an adequate and stable supply of coal for the use of such industries;
WHEREAS,
in order to effect an integrated system of coal
handling and thus accomplish the maximum efficient utilization of coal, it is
imperative that a central government authority be established;
NOW,
THEREFORE, I, FERDINAND E. MARCOS, President of the
SECTION 1.
Short
Title. – This
decree shall be known and may be cited as “The Charter
of the National Coal Authority.”
SEC. 2.
Policy
and Objectives. – Hand in hand with the existing Government policy of accelerating the
development of indigenous conventional energy resources as well as
non-conventional energy alternatives with great potential for immediate and
future applications, it is hereby declared to be the policy of the State to consider
the maximum efficient utilization of coal as an important segment of the
Government’s thrust towards energy self-sufficiency and in sustaining the rapid
growth and development of the national economy.
This policy shall be carried out by attaining the
following objectives:
1. To provide and maintain an adequate and stable supply of coal, whether imported or locally produced;
2. To establish or cause the establishment, coordinate, control and regulate an effective, efficient and economical logistics system as will adequately function to meet domestic requirements; and
3. To set up the conditions that would enable coal to substantially contribute to the country’s energy self-sufficiency program and thereby enhance the economic development of the nation.
SEC. 3.
Creation
of the National Coal Authority. – There is hereby
created the National Coal Authority, hereinafter referred to as the
Authority, which shall be responsible for implementing the policy and attaining
the objectives set under this Decree.
SEC. 4.
Powers
and Functions of the Authority. – The Authority shall insofar as
may be necessary, reasonable and practicable, undertake and assume primary
responsibility for the shift in the use of fuel for industry from petroleum to
coal, and in order to assure an adequate and stable supply of coal, it shall
coordinate, integrate, systematize, control and regulate all activities
relating to the procurement, purchase, sale, importation, exportation and
handling of coal, including the pricing, receiving, storage, transport,
distribution, processing and delivery thereof.
Additionally, it shall:
(a) Formulate and define, thru appropriate rules and regulations, the necessary plans, programs and guidelines for carrying out the policy and objectives laid down in this Decree;
(b) Using the standards of necessity, reasonableness and practicability, determine the industries that would have to shift to coal as a source of fuel;
(c) Set up the mechanism for the rapid shift in the use of coal as fuel for industry including the priorities and timing thereof, and extend such assistance as may be necessary therefor;
(d) Adopt a system whereby the adequacy of coal supply and stability of coal prices could be assured;
(e) Procure and control or cause the procurement and control of coal in such quantities and locations as may be foreseeably needed;
(f) Engage in, control, supervise and regulate the purchase, sale, importation, exportation and supply of coal and their derivatives;
(g) Establish, construct, install or maintain in any area within the national territory, ports and terminals, buildings, facilities and infrastructures for receiving, processing, blending, storing, transporting and distributing coal;
(h) Undertake the efficient, effective, adequately suitable and economical means of distributing, delivering, transporting and/or shipping coal for purposes of reducing marketing cost and ensuring stable supply;
(i) Regulate and control the receiving, storage, transportation, distribution, processing, blending, delivery and handling of coal;
(j) Regulate and control the utilization of coal as fuel for industry and establish, set up and regulate the prices thereof;
(k) Coordinate with the Ministries of Energy, Industry, and Natural Resources for the maximum efficient utilization of coal;
(l) Enter into contracts with any person or entity, domestic or foreign, private or Government, for undertaking the various aspects of its coal operations;
(m) Borrow money from local and foreign sources, guarantee or work for the guarantee of loans from Government and private financial institutions, and engage in such financing activities as may be necessary for its operations including relending to private industries to facilitate their rapid shift to the use of coal as source of fuel;
(n) Any provisions of law to the contrary notwithstanding, invest its funds, acquire assets, real or personal, or interest therein, and encumber or otherwise dispose of the same as it may deem proper and necessary in the conduct of its business;
(o) Subject to existing regulations, establish and maintain such communications systems, whether by radio, telegraph or any other manner, without the need of a separate franchise therefor;
(p) Any provision of law to the contrary notwithstanding, determine through its Board of Governors, its organizational structure and the number and positions of its officers and employees; appoint such officers and employees; fix their salaries, compensation, allowances, benefits, working hours and other terms and conditions of employment; grant them leaves of absence under such conditions as it may deem proper; discipline and/or remove them for cause; and establish a recruitment and merit system for such offices and employees;
(q) Hire technical consultants and other experts at rates competitive with private industry;
(r) Accept detail of personnel from other government agencies including government-owned or controlled corporations and pay allowances thereto in addition to their regular pay, provided such allowances do not exceed twenty-five per cent (25%) of the base pay of such personnel and provided further that the payments to be made shall come from funds out of the fines, fees and other charges which the Authority may generate in the exercise of its regulatory powers;
(s) Establish and maintain offices, branches, agencies, sub-agencies, correspondents or other units anywhere as may be needed by the Authority and reorganize or abolish the same as it may deem proper;
(t) Exercise the right of eminent domain as may be necessary for the purpose for which the Authority is created;
(u) Acquire easement over public and private land necessary for the purpose of carrying out any work essential to its coal operations, subject to payment of just compensation;
(v) Establish and maintain a technical educational system for the sustained development of the necessary manpower to manage and operate its affairs and business;
(w) Perform such acts and exercise such functions as may be necessary for the attainment of the purposes and objectives herein specified;
(x) Promulgate such rules and regulations as may be necessary to carry out the purposes of this Decree and impose a penalty for the violation thereof, consisting a fine not exceeding One Hundred Thousand Pesos (P 100,000.00) or imprisonment not exceeding five (5) years or both such fine and imprisonment;
(y) Perform such other functions as may be provided by law.
SEC. 5.
Governing Body.
– The Authority shall be governed by a Board of Governors which shall be
composed of the
Minister of Energy as
ex-officio chairman, the
Minister of Industry,
the
Minister of Natural Resources, and
the
Minister of the Budget as ex-officio
members, and one other member, to be appointed by the President of the
Philippines from the private sector.
The
Authority shall have an Executive Director to be appointed
by the President. The Executive Director
who shall be the Chief Executive Officer of the Authority shall be under the
administrative supervision and control of the Chairman. The Executive Director and the appointed
members of the Board shall serve for a term of five (5) years or until their
successors shall have been appointed and qualified. In case of any vacancy in the Board, the same shall be filled by the President of the
No
person shall be appointed as Executive Director or
member of the Board unless he is a natural born citizen of the
SEC. 6.
Duties and Responsibilities of the
Chairman of the Board and Executive Director.
– The Chairman of the Board of Governors and the Executive Director
shall exercise such powers and perform such duties as may be vested in them by
the Authority thru the Board of Governors.
SEC. 7.
Auditor.
– Any provision of law to the contrary notwithstanding, the
Commission on Audit shall appoint, subject to
the approval of the Board of Governors, a representative who shall be the
Auditor of the Authority and such personnel as may be necessary to assist said
representative in the performance of his duties. The salaries, allowances and other emoluments
of the Auditor and his staff shall likewise be subject to the approval of the
Authority.
SEC. 8.
Privileges and Incentives.
– The provisions of Presidential Decree No. 1177 and any
other law to the contrary notwithstanding, the Authority shall be entitled to
all the incentives and privileges granted by law to private enterprises engaged
in energy exploration development and utilization.
In
addition, the Authority shall exempt from all taxes, duties, fees, imposts and
all other charges imposed directly or indirectly by the Republic of the
Other
Government offices, agencies and instrumentalities
including government- owned or controlled corporations shall extend whatever
assistance may be needed by the Authority, including the detail of its
employees and officials to the Authority.
The
employees of the Authority shall not, as a matter of right, be subject to the
provisions of the
Government Service and
Insurance System as provided for under Republic Act No. 180, as amended, as
well as any law, executive orders and decrees relating to salaries, allowances,
leaves of absence, retirement privileges, regular working hours and other
government employee benefits.
SEC. 9.
Power to Grant Tax and Duty Exemptions
in times of Emergency. – The provisions of any
law, executive order rule or regulation to the contrary notwithstanding, the
Authority may, in the exercise of its regulatory powers and in times of serious
shortfall of supply of coal for the needs of domestic industries, and with the
concurrence of the
Minister of Finance,
authorize the importation of coal in such quantities as it may determine,
wholly or partially free from taxes, duties, wharfage,
special imposts and other importation taxes, fees, and charges. The Authority shall, jointly with the
Minister of Finance, determine whether full
or partial exemption will be granted, on the basis of
the prevailing coal prices and other related expenses at the time of
importation. The decision of the
Authority and the Minister of Finance as to the allowable exemption rates shall be publicized at least one (1) month in advance prior
to effectivity and shall apply equally to all who may be allowed to import coal
at the time: Provided, that the period
of effectivity of the allowable exemption rates shall not be
changed more often than once a month.
SEC. 10.
Exemption.
– To ensure that the Authority will be able to operate
with utmost flexibility, it shall be exempted from the existing requirements as
to centralized Government purchasing under LOI No.
755, the Public Bidding requirement under LOI No.
794, the review of contracts by the Presidential Review Committee envisioned
under LOI No. 620 as amended by LOI
Nos. 646, 653, 1012 and Memorandum Circular No. 1012, and the provisions of
Presidential Decree Nos. 1585 and 1594 prescribing policies, guidelines,
rules and regulations for infrastructure contracts, and standard conditions for
government contracts, concessions licenses, etc. involving
exploration, development, exploitation and utilization of natural resources,
respectively.
SEC. 11.
Government Financial Institution Guarantees.
– The provision of any law to the contrary
notwithstanding, any financial institution owned or controlled by the
Government of the Republic of the Philippines, other than the
Central Bank,
Government Service and Insurance System and
the
Social Security System, is hereby
empowered to guarantee acceptance credits, loans, transactions, undertakings,
or obligations of any kind which may be incurred by the Authority, whether
directly or indirectly, in favor of any person, association or entity, whether
domestic or foreign.
SEC. 12.
Loans.
– The Authority, when specifically authorized by the
President of the Republic of the Philippines is hereby authorized to contract
loans, credit, in any convertible foreign currency or capital goods, and
indebtedness from time to time from foreign governments, or any international
financial institutions or fund sources, or any other entities, on such terms
and conditions it shall deem appropriate for the accomplishment of its purposes
and to enter into and execute agreements and other documents specifying such
terms and conditions.
The Republic of the Philippines,
through the President of the Philippines or his duly authorized representative,
may guarantee, absolutely and unconditionally, as primary obligor and not as
surety merely, the payment of the loans, credit and indebtedness secured by the
Authority which may be over and above the amount which the President of the
Philippines is authorized to guarantee under Republic Act No. 6142, as amended, as
well as the performance of all any of the obligations undertaken by the
Authority in the territory of the Republic of the Philippines pursuant to loan
agreements entered into with foreign governments or any international financial
institutions or fund sources.
The loans, credits and indebtedness
contracted under this subsection and the payment of the principal, interest and
other charges thereon, as well as the importation of machinery, equipment, materials,
supplies and services, by the Authority as defined herein, paid from the
proceeds of any loan, credit or indebtedness incurred under this Act, shall
also be exempt from all direct as well as indirectly passed on taxes, duties,
fees, imposts, and all other charges and restrictions, including import
restrictions previously and presently imposed, and to be imposed by the
Republic of the Philippines, or any of its agencies, and political
subdivisions.
SEC. 13.
Reports.
– The Authority shall, within three months after the
end of every fiscal year, submit its annual report to the
President. It shall likewise submit such
periodic or other reports as may be required of it from time to time.
SEC. 14.
Appropriations.
– The amount of Fifty Million Pesos (P 50,000,000.00) is hereby set
aside and appropriated out of the Energy Special Fund created under Section
8(j) of Republic Act No. 6173, as amended, to provide for the initial funding
requirements of the Authority for 1980.
Thereafter, the appropriation of the Authority shall be included in the
General Appropriations Act.
SEC. 15.
Separability Clause.
– Should any provision of this Decree be held unconstitutional, no other
provision hereof shall be affected thereby.
SEC. 16.
Repealing Clause.
– All laws, decrees, executive orders, rules and regulations
inconsistent herewith are hereby repealed, amended, or modified
accordingly.
SEC. 17.
Effectivity.
– This Decree shall take effect immediately.
Done in the City of
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