Presidential Decree No. 269
CREATING
THE “NATIONAL ELECTRIFICATION ADMINISTRATION”
AS A CORPORATION, PRESCRIBING ITS POWERS AND ACTIVITIES, APPROPRIATING THE
NECESSARY FUNDS THEREFOR AND DECLARING A NATIONAL POLICY OBJECTIVE FOR THE
TOTAL ELECTRIFICATION OF THE PHILIPPINES ON AN AREA COVERAGE SERVICE BASIS, THE
ORGANIZATION, PROMOTION AND DEVELOPMENT OF ELECTRIC COOPERATIVES TO ATTAIN THE
SAID OBJECTIVE, PRESCRIBING TERMS AND CONDITIONS FOR THEIR OPERATIONS, THE
REPEAL OF REPUBLIC ACT NO. 6038, AND FOR OTHER PURPOSES
WHEREAS, it
is the desire of the government to effect changes and reforms in the social, economic,
and political structure of our society;
WHEREAS,
detailed studies have clearly emphasized the very close correlation between
consumption of energy and gross national product. Electric power, wherever introduced,
stimulates the growth of industry and the economy in general;
WHEREAS,
electrification of the entire country, one of the primary concerns of the
government in order to bring about the desired changes and reforms, can be
hastened by rationalizing the distribution of electricity;
WHEREAS,
rationalization, which implies the adoption of all measures necessary to obtain
the maximum benefit at the minimum expenses, can be achieved by:
1.
Establishing island grids and integrating power generating
systems.
2.
Consolidating electric distribution franchise systems. The existence of small franchise system
impede the progress of total electrification, as such small and isolated
systems are antithetical to the economies of scale.
3.
Implementing the area coverage concept, which will allow the
construction of lines to thinly settled areas which are most costly to
electrify, provided that the losses from these lines can be reasonably absorbed
by the more profitable lines.
WHEREAS,
under Republic Act No. 6038, dated August 4, 1969, Presidential Decree No. 40 and Letter of Instruction No.
38, dated November 7, 1972, the National
Electrification Administration was given certain powers, duties, and
functions to attain total electrification on an area coverage basis; to set up
cooperatives for the distribution of power; and to determine privately-owned
public utilities which should be permitted to remain in operation;
WHEREAS, to
attain total electrification in the most effective and efficient manner, there
is a need to further strengthen and make more flexible the organizational
structure of the National Electrification
Administration by converting it into a corporation, wholly-owned and
controlled by the government, possessed with borrowing authority and corporate
powers;
NOW,
THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of the
Philippines, by virtue of the powers vested in me by the Constitution as
Commander-in-Chief of the Armed Forces of the Philippines, and pursuant to
Proclamation No. 1081, dated September 21, 1972, and General Order No. 1, dated
September 22, 1972, as amended, do hereby repeal Republic
Act No. 6038 and do hereby decree, order and make as part of the law of the
land the Charter of the National
Electrification Administration, which reads as follows:
CHAPTER I
Policy and Definitions
Section 1. Title. This Decree shall be
referred to as the “National Electrification Administration Decree.”
Section
2. Declaration of
National Policy. The
total electrification of the Philippines on an area coverage basis being vital
to the welfare of its people and the sound development of the Nation, it is
hereby declared to be the policy of the state to pursue and foster, in an
orderly and vigorous manner, the attainment of this objective. For this purpose, the State shall promote,
encourage and assist all public service entities engaged in supplying electric
service, particularly electric cooperatives, which are willing to pursue
diligently this objective.
Because of
their non-profit nature, cooperative character and the heavy financial burdens
that they must sustain to become effectively established and operationally
viable, electric cooperatives, particularly, shall be given every tenable
support and assistance by the National Government, its instrumentalities and
agencies to the fullest extent of which they are capable; and, being by their
nature substantially self-regulating and Congress, having, by the enactment of
this Decree, substantially covered all phases of their organization and
operation requiring or justifying regulation, and in order to further encourage
and promote their development, they should be subject to minimal regulation by
other administrative agencies.
Area
coverage electrification cannot be achieved unless service to the more thinly
settled areas and therefore more costly to electrify is combined with service
to the most densely settled areas and therefore less costly to electrify. Every public service entity should hereafter
cooperate in a national program of electrification on an area coverage basis,
or else surrender its franchise in favor of those public service entities which
will. It is hereby found that the total
electrification of the Nation requires that the laws and administrative
practices relating to franchised electric service areas be revised and made
more effective, as herein provided. It
is therefore hereby declared to be the policy of the State that franchises for
electric service areas shall hereafter be so issued, conditioned, altered or
repealed, and shall be subject to such continuing regulatory surveillance, that
the same shall conduce to the most expeditious electrification of the entire
Nation on an area coverage basis.
Section
3. Definitions. As used in this Decree, the
following words or terms shall have the following meanings, unless a different
meaning clearly appears from the context:
(a)
“NEA” shall mean the National Electrification Administration,
“Board of Administrators” shall mean the Board of Administrators, and
“Administrator” shall mean the Administrator, all as provided for in this
Decree.
(b)
“Cooperative” shall mean a corporation organized under Republic Act No. 6038 or this Decree or cooperative
supplying or empowered to supply service which has heretofore been organized
under the Philippine Non-Agricultural
Cooperative Act, whether covered under this Decree or not.
(c)
“Public service entities” shall mean (1) a cooperative,
(2) the NPC, and (3) local
governments and privately-owned public service entities in operation which
furnish and are empowered to furnish retail electric service.
(d)
“Person” shall mean any natural person, firm, association, cooperative,
corporation, business trust, partnership, the National Government or any
political subdivision, agency or instrumentally thereof.
(e)
“Service” shall mean electric service, either at wholesale or
retail, including the finishing of any auxiliary or related service.
(f)
“Dependable and adequate service” shall mean service that,
consistent with normal standards and levels of service based upon good utility
management and operating practices, is sufficient in quantity, having regard
for the demands for service currently existing and reasonably anticipated
within the foreseeable future, and that is accessible on a constant and
continuous basis except for outages occasioned by the need for normal repair,
maintenance, construction or renovation work or by acts beyond the reasonable
ability of the public service entity to prevent or control.
(g)
“Area” shall mean (1) the geographic area franchised to a
public service entity or (2) any lesser geographic area for the furnishing of
retail service to which a public service entity pursuant to this Decree
borrows, or may apply to borrow, funds from the NEA,
or may otherwise secure loans with the approval of the NEA, to finance the acquisition or construction
and operation, maintenance or renovation of service facilities.
(h)
“Area coverage” shall mean dependable and adequate service
that, on the basis of reasonable and standard extension and service policies,
rates, charges and other terms and conditions, will be or is being made
available to all persons within the affected area as above defined who request
such service and are able and willing to abide by and comply with all such
reasonable and standard terms and conditions, regardless of the relative
location of such persons within the affected area or of their proximity to
existing or proposed service facilities:
Provided, That the financial
feasibility of the public service entity’s entire operation is not thereby
impaired.
(i)
“Interest rate per centum per annum” shall mean an interest
rate that is accrued solely upon the unpaid balance of any loan principal which
has actually been advanced to a borrower and upon any interest payment which
has become due or been deferred and has not been paid by the borrower; computed
on an annual basis.
(j)
“Loan” shall mean a loan the total principal amount of which,
as and when required for application to the purposes thereof, is, at the time
of the making thereof, assured from funds that are or will become available therefor.
(k)
“NEDA” shall mean National Economic and Development Authority
or any successor or instrumentality that may hereafter be established to
perform the same or substantially similar function; “NPC” shall mean National Power Corporation; and “NEDA-FS” shall mean National Economic and Development
Authority-Foreign Source.
(l)
“Board of Power and Waterworks” shall mean Board of Power and
Waterworks or any successor board, agency or instrumentality that may hereafter
be established to perform the same or substantially similar functions.
(m)
“Franchise” shall mean the privilege extended to a person to
operate an electric system for service to the public at retail within a
described geographic area, whether such privilege had been granted by the Congress,
by a municipal, city or provincial government or, as herein provided, by the NEA.
(n)
“Non-profit” shall mean that a cooperative shall not engage
in business for the purpose of making a profit for itself or its patrons, but
it shall not mean that a cooperative may not account on a patronage basis to
its patrons for any receipts in excess of its expenses in relation to its
operations in serving such patrons or in relation to investment of any of its
surplus funds pending their use by the cooperative or their refund to patrons;
nor shall it mean that such excess receipts may not be refunded to its patrons,
or may not be converted into patron-furnished capital subject to later
redemption and retirement by the cooperative.
(o)
“Board” shall mean the board of directors of a cooperative.
(p)
“Household” shall mean a non-seasonal dwelling capable of
receiving service safely, including apartments and other dwelling
combinations.
(q)
“Congress” shall mean the President during his exercise of
Martial Law, or the National Assembly under the new Constitution of 1973,
whichever is the case at any given time.
(r)
“President” shall mean the President of the
CHAPTER II
The National Electrification Administration
Section
4. NEA Authorities, Powers and Directives. The NEA is hereby authorized,
empowered and directed to promote, encourage and assist public service
entities, particularly cooperatives, to the end of achieving the objective of
making service available throughout the nation on an area coverage basis as
rapidly as possible; and for such purpose it is hereby, without limiting the
generality of the foregoing and in addition to other authorizations, powers and
directives established by this Decree, specifically authorized, empowered and
directed:
(a)
To have a continuous succession under its corporate name
until otherwise provided by law;
(b)
To prescribe and thereafter to amend and repeal its by-laws
not inconsistent with this Decree;
(c)
To adopt and use a seal and alter it at its pleasure;
(d)
To sue and to be sued in any court: Provided,
That NEA shall, unless it consents
otherwise, be immune to suits for acts ex
delicti;
(e)
To make contract of every name and nature and to execute all
instruments necessary or convenient for the carrying on of its business;
(f)
To make loans to public service entities, with preference to
cooperatives, for the construction or acquisition, operation and maintenance of
generation, transmission an distribution facilities and all related properties,
equipment, machinery, fixtures, and materials for the purpose of supplying area
coverage service, and thereafter to make loans for the restoration, improvement
or enlargement of such facilities: Provided, That the public service entity
supplying for a loan, if neither a cooperative nor a local government, must be
in operation at the time of application;
(g)
To promote, encourage and assist public service entities and
government agencies and corporations having related functions and purposes,
with preference to cooperatives, in planning, developing, coordinating,
establishing, operating, maintaining, repairing and renovating facilities and
systems to supply area coverage service, and for such purpose to furnish, to
the extent possible and without change therefor, technical and professional
assistance and guidance, information, data and the results of any
investigation, study, or receipt conducted or made by the NEA;
(h)
To approve or disapprove any loan from other lenders to
public service entities which at the time are borrowers from NEA under sub-paragraphs (f) or (i) of this
section, and thereafter, pursuant to Section 10 (b) to disapprove advances of
loans from other lenders;
(i)
To make loans for the purpose of financing the wiring of
premises of persons served or to be served as a result of loans made under
sub-paragraph (f) of this Section, and for the acquisition and installation by
such persons of electrically-powered appliances, equipment, fixtures and
machinery of all kinds for residential, recreational, commercial, agricultural
and industrial uses, such loans to be made directly (1) to public service
entities which have received loans under sub-paragraph (f) of this section,
which entities shall in turn relend such funds to persons served or to be
served by them, or (2) to any persons served or to be served by public service
entities which have received loans under sub-paragraph (f) of this
section: Provided, That at no time shall the total loans made under this
sub-paragraph (i) to a public service entity and/or to persons served or to be
served by such entity exceed twenty-five (25%) per centum of the outstanding
loans to such entity made under sub-paragraph (f) of this section;
(j)
To so cooperate, coordinate and exchange such information,
studies and reports with, and to seek such cooperation and coordination from,
other departments, agencies and instrumentalities of the National Government,
including the NPC, as will most
effectively conduce to the achievement of the purposes of this Decree;
(k)
To borrow funds from any source, private or government, foreign
or domestic, and, not inconsistently with section 8, to issue bonds or other
evidences of indebtedness therefor and to secure the lenders thereof by
pledging, sharing or subordinating one or more of the NEA’s own loan securities;
(l)
To receive from Cooperatives all articles of incorporation,
amendments, consolidation, merger, conversion and dissolution, and all
certificates of changes in the location of principal offices and of elections
to dissolve, and, upon determining that such are in conformity with this
Decree, to certify the same, to file them in the records of the NEA, and to maintain a registry of such
filings the provisions of Act No. 1459, as amended, to the contrary
notwithstanding;
(m)
To acquire, by purchase or otherwise (including the right of
eminent domain, which is hereby granted to the NEA,
to be exercised in the manner provided by law for the institution and
completion of expropriation proceedings by the National and local governments,)
real and physical properties, together with all appurtenant rights, easements,
licenses and privileges, whether or not the same be already devoted to the
public use of generating, transmitting or distributing electric power and
energy, upon NEA’s determination that such
acquisition is necessary to accomplish the purposes of this Decree and, if such
properties be already devoted to the public use described in the foregoing,
that such use will be better served and accomplished by such acquisition: Provided,
That the power herein granted shall be exercised by the NEA solely as agent for and on behalf of one
or more public service entities which shall timely receive, own and utilize or
replace such properties for the purpose of furnishing adequate and dependable
service on an area coverage basis, which entity or entities shall then be, or
in connection with the acquisition shall become, borrowers from the NEA under sub-paragraph (f) of this section;
and Provided further, That the costs
of such acquisition, including the cost of any eminent domain proceedings,
shall be borne, either directly or by reimbursement to the NEA, whichever the NEA shall elect, by the public service entity
or entities on whose behalf the acquisition is undertaken; and otherwise to acquire,
improve, hold, transfer, sell, lease, rent, mortgage, encumber and otherwise
dispose of property incident to, or necessary, convenient or proper to carry
out, the purposes for which NEA was
created;
(n)
At least annually, not later than June 30th, to report to the
President and when the same comes into existence, the Prime Minister and the
National Assembly, on the status of electrification of the Philippines,
including a comprehensive reporting of loans made, loan funds advanced, loans
secured from other sources and the advances thereof, the names and locations of
the borrowers, the number of services contemplated by such loans, the number
actually receiving service as a result of such loans, the number of electrified
and the remaining number of unelectrified households throughout the Nation, the
amounts of usage by consumers, loan and other activities programmed for the
ensuing year, and all such other information and data as will accurately reveal
the progress being made toward the achievement of the purposes of this Decree;
and to publish such report for dissemination to and use by other interested
departments, agencies and instrumentalities of the National Government and by
borrowers under this Decree; and
(o)
To exercise such powers and do such things as may be
necessary to carry out the business and purposes for which the NEA was established, or which from time to
time may be declared by the Board of Administrators to be necessary, useful,
incidental or auxiliary to accomplish such purposes; and generally, to exercise
all the powers of a corporation under the Corporation
Law insofar as they are not inconsistent with the provisions of this
Decree.
Section 5. National Electrification Administration; Board
of Administrators; Administrator.
(a)
For the purpose of administering the provisions of this
Decree, there is hereby established a public corporation to be known as the National Electrification Administration. All of the powers of the corporation shall be
vested in and exercised by a Board of Administrators, which shall be composed
of a Chairman and four (4) members, one of whom shall be the Administrator as ex-officio member. The Chairman and the three other members
shall be appointed by the President of the Philippines to serve for a term of
six years: Provided, That the terms of the first appointees shall be six years
for the Chairman and one member and three years for the two other members,
respectively, and that the term of the ex-officio
member shall be co-terminus with his term as the Administrator. All vacancies, except through expiration of
the terms, shall be filled for the unexpired term only. The Chairman and every member of the Board of Administrators shall be entitled to
a per diem of not more than three
hundred pesos for each meeting actually attended by them: Provided,
That the total of such per diems shall not exceed one thousand five hundred
pesos per month per member.
The Board of Administrators
shall meet regularly at least twice a month and as often as the exigencies of
the agency’s affairs demand.
The presence of at lest three members shall constitute a
quorum which shall be necessary for the transaction of any business. The affirmative vote of a majority of the
members present shall be necessary for the approval of any resolution, decision
or order, except when a greater vote is required as sometimes hereinafter
provided. In the absence of the Chairman
at a Board meeting duly called, the Administrator as ex-officio member shall
preside.
The Board shall, without limiting the generality of the
foregoing, have the following specific powers and duties.
1.
To implement the provisions and purposes of this Decree;
2.
To formulate and adopt policies and plans, and to promulgate
rules and regulations, for the management, operation and conduct of the
business of the NEA;
3.
To adopt and, as may be necessary from time to time, to amend
annual budgets for the NEA’s borrowing and
lending programs and for the agency’s administration: Provided,
That copies of such budgets shall be submitted to the President or the
appropriate committee of and as determined by, the National Assembly, when it
comes into existence, within fifteen (15) days from the transmission thereof to
the NEDA; and Provided, further, That the administrative budget and any
amendments thereto shall be subject to the approval of NEDA;
4.
To fix the compensation of the Administrator and of the
Deputy Administrators, subject to the approval of the President of the
5.
To establish policies and guidelines for employment on the
basis of merit, technical competence and moral character, and, upon the
recommendation of the Administrator to organize or reorganize NEA’s staffing structure, to fix the salaries
of personnel and to define their powers and duties.
The management of NEA
shall be vested in the Administrator, who shall be a person of known integrity,
competence and experience in technical and executive fields related to the
purposes of this Decree. He shall be
appointed by the President of the
The Administrator shall have the following powers and
duties:
1.
To execute and administer the policies, plans and program,
and the rules and regulations, approved or promulgated by the Board of
Administrators;
2.
To submit for the consideration of the Board of
Administrators such policies, plans and programs as he deems necessary to carry
out the provisions and purposes of this Decree;
3.
To direct and supervise the operation and internal
administration of the NEA and, for this
purpose, to delegate some or any of his powers and duties to subordinate
officials of the NEA;
4.
Subject to the guidelines and policies established by the Board
of Administrators, to appoint and fix the number and compensation of
subordinate officials and employees of the NEA: Provided,
however, The provisions of the Civil
Service Law and Position
Classification Law shall not apply to the appointment and compensation of
any such subordinate official or employee;
5.
For cause, to remove, suspend, or otherwise discipline any
subordinate official or employee;
6.
To prepare an annual report on the activities of the NEA at the close of each fiscal year and to
submit a copy thereof to the President of the Philippines and when it comes
into existence, the Prime Minister and the appropriate committee of, and as
determined by, the National Assembly; and
7.
To exercise such other powers and duties as may be vested in
him by the Board of Administrators.
In case of absence or disability of the Administrator, he
shall designate any of the Deputy Administrators who shall act in his place.
The Auditor General
shall be ex-officio Auditor of the NEA.
The provisions of Section 584 of the Revised
Administrative Code, as amended by Republic Acts Numbered 2266 and 2716,
shall apply to the Office of the Representative of the Auditor General in the NEA.
Section
6. Capital Stock. The authorized capital stock
of NEA is one billion pesos (P 1 B) divided
into ten (10) million shares having a par value of one hundred (P 100.00) pesos
each, which shares are not to be transferred, negotiated, pledged, mortgaged,
or otherwise given as security for the payment of any obligation. The sum of fifty million pesos (P 50 M) of
the capital stock has been subscribed and paid wholly by the government of the
Philippines in accordance with the provisions of Republic Act Numbered
Twenty-seven hundred seventeen, and Republic Act Numbered Sixty hundred
thirty-eight.
The remaining nine hundred
fifty million pesos (P 950 M) shall be wholly subscribed by the government of
the
(a)
The sum of one hundred ninety five million pesos (P 195 M)
worth of goods and services from Japanese Reparations for the eighteenth,
nineteenth and twentieth year schedule, which is hereby allocated to NEA;
(b)
The sum of ten million pesos (P 10 M) for the fiscal year
1973 and the same amount each year for the next two fiscal years making a total
sum of thirty million pesos (P 30 M) representing proceeds of the sale of
reparation goods, which are hereby allocated to NEA;
(c)
The sum of fifty three million five hundred thousand pesos (P
53.5 M) for the fiscal year 1973 and the same amount each year for the next
nine (9) fiscal years from the general revenue, which are hereby appropriated;
(d)
The sum of one hundred thirty million pesos (P 130 M)
representing fund or physical assets which NEDA-FS
may make available to the NEA for loan
purposes;
(e)
The sum of sixty million pesos (P 60 M) representing proceeds
corresponding to the share of the National Government in all franchise taxes
paid by electric service entities; and
(f)
Such sums as may be appropriated and/or allocated by the
President or the National Assembly, when it comes into existence, from time to
time as the financial needs of the NEA
shall require until the authorized capital stock is fully paid-up.
Section
7. Loan Standards. In making a loan authorized
in Section 4, the Board of Administrators is hereby authorized, empowered and directed:
(a)
Before making such loan, to determine and certify that (1)
the project or projects being financed thereby are financially feasible for the
purpose of, and will result in, area coverage in the area or areas to be
affected thereby; (2) funds are or will be available for the total advance of
such loans to the borrower on the schedule contemplated by the loan agreement;
and (3) in the NEA’s judgment and security
for such loan is reasonably adequate and the principal of and interest upon
such loan will be repaid on schedule and within the time agreed;
(b)
To require that such loan be self-liquidating within a term
to be fixed by the NEA;
(c)
To impose upon the loan principal an interest charge to be
fixed by the NEA;
(d)
To fix the schedule for repayment of the principal of and the
interest upon such loan in installments recurring not more than every quarter,
which installments may be in unequal amounts and larger in the later years of
the loan term than in the earlier years;
(e)
To require in the loan agreement that the borrower’s rates,
charges, rules and regulations, policies and all other terms and conditions affecting
its extension and furnishing of service shall be such as to assure achievement
of the loan purposes, and that the same shall be filed with and for such
purpose approved by the Board of Administrators before being put into effect or
charged by the borrower; and
(f)
Subject to the foregoing, to establish and require compliance
with such procedures, rules and regulations as the Board of Administrators may
determine to be necessary or appropriate to assure that the purposes of such
loan will be timely achieved and that the loan agreement and the provisions of
this Decree will be complied with.
Section
8. Contracting
Indebtedness: Conditions, Privileges,
Exemptions, Sinking Fund, Guarantees. Whenever
the Board of Administrators determines that to accomplish the purposes of
Chapter II of this Decree it is necessary to contract indebtedness, it shall by
a resolution, adopted by the affirmative votes, of at least three members, to
declare and authorize the NEA’s execution
or issuance of, and establish the terms and conditions to be contained in, such
bonds, loan agreements or other evidences of indebtedness necessary
therefor. Such resolution shall become
valid and effective upon approval by the President of the
(a)
With respect to domestic indebtedness to be incurred by the NEA, the terms and conditions to be contained
in such bonds or other evidences of indebtedness, and other conditions,
privileges, exemptions and guarantees attaching thereto, shall include the
following:
(1)
Such bonds or other evidences of indebtedness (a) shall be in
registered form and transferable at the Central
Bank of the Philippines; (b) shall not be sold at less than par; (c) shall
be payable ten years or more from date of issue, as may be determined by the Secretary of Finance before their issuance,
but shall be redeemable, upon the election of the Board of Administrators,
after five years from such date of issue; and (d) shall bear interest at an
annual rate to be determined before their issuance by the Secretary of Finance. The interest may be payable quarterly,
semi-annually of annually, as determined by the Secretary
of Finance in consultation with the Monetary
Board of the Central Bank of the Philippines before date of issuance, and
both the principal and interest shall be payable in legal tender of the
Philippines.
(2)
The bonds or other evidences of indebtedness shall be exempt
from the payment of all taxes by the Republic of the Philippines, or by any
authority, branch, division, political subdivision thereof, which facts shall
be stated upon their face; and they shall be receivable as security in any
transaction with the National Government or any of its branches, subdivisions,
instrumentalities and its owned or controlled corporations in which a security
is required.
(3)
The sinking fund shall be established by the National Electrification Administration in
such manner that the total annual contributions thereto, accrued at such rate
of interest as may be determined by the Secretary
of Finance in consultation with the Monetary
Board, shall be sufficient to redeem at maturity the bonds issued under
this subsection. The sinking fund shall
be under the custody of the Central Bank of
the Philippines, which shall invest the same, subject to the approval of
the Board of Administrators and the Secretary
of Finance in consultation with the Monetary
Board: Provided, That the proceeds thereof shall accrue to the NEA.
(4)
The Republic of the Philippines hereby guarantees the payment
by the NEA of both the principal and the
interest of the bonds or other evidences of indebtedness, and shall pay such
principal and interest in case the NEA
fails to do so; and there are hereby appropriated out of the general funds in
the National Treasury not otherwise appropriated the sums necessary to make the
payments so guaranteed: Provided, That the sums so paid by the
Republic of the Philippines shall be refunded by the NEA; and Provided,
further, That the NEA, to assure such
refunding, shall establish such reserves or sinking funds and comply with such
other restrictions and conditions as the Secretary
of Finance may prescribe and establish for that purpose.
(b)
With respect to foreign indebtedness to be incurred by the NEA, such may be contracted, in the form of
loans, credits, convertible foreign currencies, or other forms of indebtedness,
from foreign governments or any international financial institution or fund
source, including foreign private lenders.
The total outstanding amount of such indebtedness, exclusive of
interest, shall not exceed five hundred million
Section 9. Authority
to Extend Loans and Release or Subordinate Securities. Whenever in its judgments
such is necessary or desirable to achieve the purposes of this Decree, and
particularly if such is necessary to make or keep a project operationally viable,
the Board of Administrators is hereby authorized and empowered (a) by agreement
with the borrower, to extend the time of payment of principal or interest, or
both, beyond the loan agreement term of any loan made by the NEA under this Decree, or to defer, for not
in excess of seven years, the time when the repayment schedule for principal or
interest, or both, shall begin, or to reschedule payments of principal or interest,
or both, or when more of the foregoing is sufficient, to compromise any amount
owing by a borrower to the NEA subject to
provision of existing laws; and (b) upon the NEA’s
determination that such is necessary or desirable for the purpose of enabling a
borrower to accomplish the purposes for which it has already received an NEA loan and that such will not result in any
diminution of the security of, or of the ability of the borrower to repay, any
outstanding indebtedness of the borrower below the level of such security and
ability were additional borrowings from another lender not undertaken, to
release any after-acquired property clause contained in any lien the NEA holds on a borrower’s properties to, or
to share any such lien on a co-equal basis in proportion to their respective
loans with, or to subordinate any such lien in favor of, any other lender of
funds to a public service entity or to the NEA
for relending to public service entities for the purposes for which loans are
authorized under this Decree.
Section
10. Enforcement
Powers. If
any public service entity which has borrowed funds from the NEA, or from any other lender with the NEA’s lawfully required prior approval, shall
default in its principal or interest payments, or shall fail, after notice from
the NEA, to comply with any other term or
condition of the loan agreement or of any rule or regulation promulgated by the
NEA in administering the provisions of
this Decree, the Board of Administrators is hereby authorized and empowered in
its discretion to do any or any combination of the following:
(a)
Refuse to make, or give my lawfully required approval to, any
new loan to the borrower;
(b)
Withhold without limitation the NEA’s advancement, or withhold its approval
for any other lender with respect to which the NEA
has such approving power to make advancement, of funds pursuant to any loan
already made to the borrower;
(c)
Withhold any technical or professional assistance otherwise
being furnished or that might be furnished to the borrower;
(d)
Foreclose any mortgage or deed of trust or other security
held by the NEA on the properties of such
borrower, in connection with which the NEA,
may, subject to any superior or co-equal rights in such lien held by any other lender;
(1) bid for and purchase or otherwise acquire such properties; (2) pay the
purchase price thereof and any costs and expenses incurred in connection
therewith out of the revolving fund; (3) accept title to such properties in the
name of the Republic of the Philippines; and (4) even prior to the institution
of foreclosure proceedings, operate or lease such properties for such period,
and in such manner as may be deemed necessary or advisable to protect the
investment therein, including the improvement, maintenance and rehabilitation
of systems to be foreclosed, but the NEA
shall, within five years after acquiring such properties in foreclosure
proceedings, sell the same for such consideration as it determines to be
reasonable and upon such terms and conditions as it determines most conducive
to the achievement of the purposes of this Decree; or
(e)
Take any other remedial measure for which the loan agreements
may provide.
In addition
to the foregoing, the Board of Administrators may, at its own instance and in
the name of the NEA, petition any court
having jurisdiction for such purpose or any administrative agency possessing
regulatory powers for such purpose (including the Board of Power and
Waterworks) to issue such order and afford such lawful relief as may be
necessary.
No borrower
shall, without the approval of the Board of Administrators and of any other
lender holding or sharing a lien on such borrower’s properties, sell or dispose
of the property, rights, franchises, permits or any other assets acquired
and/or mortgaged pursuant to the provisions of this Decree until all
outstanding indebtedness to the NEA and
any other such lender, including all interest owing thereon, shall have been
repaid: Provided, That the NEA may by
appropriate rule or regulation grant general permission to borrowers to dispose
of incidental properties (excluding real property) , rights, franchises,
permits or other assets no longer deemed necessary or useful in conducting the
borrower’s operations.
No
cooperative shall borrow money from any source without the Board of
Administrators’ prior approval: Provided, That the Board of
Administrators may, by appropriate rule or regulation, grant general permission
to cooperatives to secure short-term loans not requiring the encumbering of
their real properties or of a substantial portion of their other properties or
assets.
Section
11. Execution
of Public Works Acts. The NEA shall execute all electrification
projects that may be authorized in any Public Works Acts; and for this purpose it
may call for assistance and cooperation consistently with Section 4 (j).
Section
12. Conflict
of Interest.
(a)
No member, officer, attorney, agent or employee of the NEA shall in any manner, directly or indirectly,
participate in the determination of any question affecting any public service
entity or other entity in which he is directly or indirectly interested or any
person to whom he is related within the third degree of affinity or
consanguinity. Any person violating the
provisions of this subsection shall be removed from office and shall upon
conviction be punished by a fine not to exceed ten thousand (P 10,000.00) pesos
or imprisonment not to exceed five years, or both.
(b)
No officer or employee of the NEA
or any government official who may exercise executive or supervisory, authority
over the NEA, either directly or indirectly,
for himself or as the representative or agent of others, shall become a
guarantor, endorser, surety for loans from the NEA
to others, or in any manner be an obligor for money borrowed from the NEA.
Any such officer or employee who violates the provisions of this
subsection shall be punished by a fine of not less than one thousand pesos
(P1,000.00) nor more than five thousand (P5,000.00) pesos, or imprisonment for
not less than one year nor more than five years, or both.
(c)
No loan shall be granted by the NEA to any person related to any member of the
Board of Administrators or to the Administrator within the third degree of
consanguinity or affinity, or to any corporation, partnership, or company
wherein any member of the Board of Administrators or the Administrator is a
shareholder: Provided, That the foregoing prohibition shall not apply to a
cooperative of which any member of the Board of Administrators or the
Administrator or any such relative is a member.
Violation by any member of the Board of Administrators or the
Administrator of the provisions of this subsection is sufficient cause for this
removal by the President of the
(d)
No fee, commission, gift, or charge of any kind shall be
exacted, demanded, or paid for obtaining loans from the NEA.
Any officer, employee or agent of the NEA
or the government exacting, demanding or receiving any fee, commission, gift or
charge of any kind for service in obtaining a loan shall be punished by a fine
of not less than one thousand nor more than three thousand pesos, or
imprisonment for not less than one year nor more than three years, or both.
(e)
Any person who, for the purpose of obtaining, renewing, or
increasing a loan or the extension of the period thereof, on his own or
another’s behalf, shall give any false information or cause through his
intrigue or machination the existence and production of any false information
with regard to the identity, situation, productivity or value of security, or
with regard to a point which might affect the granting or denial of the loan,
whether the latter has been consummated or not, and any officer or employee of
the NEA who through connivance shall allow
by action or omission such false information to pass unnoticed, thereby causing
damage to the NEA or exposing the latter to
the danger of suffering such damage, shall be punished by a fine of not less
than the amount of the loan obtained or applied for nor more than three times
such amount, or imprisonment for not less than three months nor more than three
years, or both.
(f)
Any officer or employee of the NEA
who violates, or causes or permits another person to violate, and any other
person who violates or aids or abets the violation of, any provision of this
Decree not specifically punishable in the preceding subsections shall be
punished by a fine not exceeding two thousand (P 2,000.00) pesos, or
imprisonment not exceeding one year, or both.
Section
13. Supervision
over NEA; Power Development Council. The NEA shall be under the supervision of the
Office of the President of the
In order to
achieve coordination and cooperation among different agencies and sectors
having to do with electrification and power development, there is hereby
created a Power Development Council whose Chairman shall be a person or
official designated by the President of the Philippines, and its members shall
be the manager of the NPC, the NEA Administrator, the Director General of the NEDA, the Chairman
of the Board of Power and Waterworks, a representative of electric cooperatives
to be chosen by a national association of electric cooperatives, and a
representative of the Private sector.
The Council
shall have a Secretariat to be headed by an Executive Secretary and staffed by
such number of personnel as may be determined by the Council. In order to augment the expertise necessary
in the performance of its functions, the council may secure the detail of
personnel, either on a part-time or full-time basis, as well as other forms of
assistance from other government offices and agencies, including government-
owned or controlled corporations. The
qualifications and compensation of the personnel of the Secretariat shall be
determined by the Council, but their appointments shall be made by the
Chairman.
The
salaries, expenses, operating expenses and such other necessary financial
outlays for PDC shall be provided for from a special annual assessment to be
determined by the Chairman of PDC and paid by the NEA and NPC.
The Council shall adopt an integrated
plan of electrification and power development, coordinate the activities and
operations of all sectors involved in electrification, and recommend such
policies and measures to the proper authorities and parties concerned as it may
deem necessary to achieve the total electrification objective declared in this
Decree.
Section 14. Exemption From All Taxes,
Duties, Fees, Imposts and Others Charges by Government and Governmental
Instrumentalities. The NEA shall devote all its returns from its
capital investments as well as excess revenues from its operation to attain its
objectives. To enable the NEA to pay its indebtedness and obligations
and in furtherance and effective implementation of the policy enunciated in
this Decree, the NEA is hereby declared
exempt:
(a)
From the payment of all taxes, duties, fees, imposts,
charges, costs and restrictions to the Republic of the Philippines, its
provinces, cities, municipalities, and other government agencies and
instrumentalities, including the taxes, duties, fees, imposts and other charges
provided for under the Tariff and Customs
Code of the Philippines, R.A. 1973, as amended by Presidential Decree No.
34 dated October 27, 1972, and Presidential Decree No. 69 dated November 24,
1972, and filing and service fees and other charges or costs in any court or
administrative proceedings in which it may be a party;
(b)
From all income taxes, franchise taxes and realty taxes to be
paid to the National Government, its provinces, cities, municipalities and
other government agencies and instrumentalities;
(c)
From all import duties, compensating taxes and advance sales
tax, wharfage fees on import of foreign goods required for its operations and
projects; and
(d)
From all taxes, duties, fees, imposts, and all other charges
imposed directly or indirectly by the Republic of the
CHAPTER III
Electric Cooperatives
Section
15. Organization
and Purpose. Cooperative
non-stock, non-profit membership corporations may be organized, and electric
cooperative corporations heretofore formed or registered under the Philippine Non-Agricultural Cooperative Act
may as hereinafter provided be converted, under this Decree for the purpose of
supplying, and of promoting and encouraging the fullest use of, service on an
area coverage basis at the lowest cost consistent with sound economy and the
prudent management of the business of such corporations.
Section
16. Powers. A cooperative is hereby
vested with all powers necessary or convenient for the accomplishment of its
corporate purpose and capable of being delegated by the President or the
National Assembly when it comes into existence; and no enumeration of
particular powers hereby granted shall be construed to impair any general grant
of power herein contained, nor to limit any such grant to a power or powers of
the same class as those so enumerated. Such
powers shall include but not be limited to, the power:
(a)
To sue and be sued in its corporate name;
(b)
To have existence for a period of fifty years;
(c)
To adopt a corporate seal and alter the same;
(d)
To generate, manufacture, purchase, acquire, accumulate and
transmit electric power and energy, and to distribute, sell, supply and dispose
of electric energy to persons who are its members and to other persons not in
excess of ten per centum of the number of its members: Provided,
however, That a cooperative may furnish electric cold storage or processing
plant service to non-members without limitation; and Provided, further, That a cooperative which acquires existing
electric facilities may continue service from such facilities without requiring
such persons to become members, but such persons may become members upon such
terms as may be prescribed in the cooperative’s by-laws;
(e)
To assist persons to whom service is or will be supplied by
the cooperative in wiring their premises and in acquiring and installing electrically
powered-appliances, equipment, fixtures and machinery for agricultural,
commercial and industrial uses by the financing thereof or otherwise, and in
connection therewith to wire, or cause to be wired, such premises, and to
purchase, acquire, lease as lessor or lessee, sell, distribute, install and
repair such electrically-powered appliances, equipment, fixtures and machinery;
(f)
To assist persons to whom service is or will be supplied by
the cooperative in constructing, equipping, maintaining and operating electric
cold storage or processing plants, by the financing thereof or otherwise;
(g)
To construct, purchase, lease as lessee, or otherwise
acquire, and to equip, maintain, and operate, and to sell, assign, convey,
lease as lessor, mortgage, pledge, or otherwise dispose of or encumber,
electric transmission and distribution lines or systems, electric generating
plants, lands, buildings, structures, dams, plants, and equipment, and any
other real or personal property, tangible or intangible, which shall be deemed
necessary, convenient or appropriate to accomplish the purpose for which the
cooperative is organized;
(h)
To purchase, lease as lessee, or otherwise acquire, and to
use, and exercise and to sell, assign, convey, mortgage, pledge or otherwise
dispose of or encumber franchises, rights, privileges, licenses and easements;
(i)
To borrow money and otherwise contract indebtedness, and to
issue notes, bonds, and other evidence of indebtedness, and to secure payment thereof
by mortgage, pledge, or deed of trust of, or any other encumbrance upon, any or
all of its then owned or after-acquired real or personal property, assets,
franchises, or revenues: Provided, That any borrowing from, or
any encumbering of its properties as security in favor of, any lending sources
other than the NEA shall require the prior
approval of the NEA Administrator and his
certification that such is in furtherance of the purposes and is consistent
with the provisions of this Decree, and that such borrowing and/or encumbering
will not diminish the security of, or of the ability of the cooperative to
repay, any then-outstanding indebtedness of the cooperative to the NEA or any other lending source below the
level of such security and ability were such additional borrowing not being
undertaken;
(j)
To construct, maintain and operate electric transmission and
distribution lines along, upon, under and across publicly owned lands and
public thoroughfares, including, without limitation, all roads, highways,
streets, alleys, bridges and causeways: Provided, That such shall not prevent or
unduly impair the primary public uses to which such lands and thoroughfares are
otherwise devoted;
(k)
To exercise the power of eminent domain in the manner
provided by law for the exercise of such power by other corporations
constructing or operating electric generating plants and electric transmission
and distribution lines or systems;
(l)
To become a member of other cooperatives or Corporations or
to own stock therein, provided such cooperatives to corporations are engaged in
a business or activities germane to or having a reasonable relation to the
business or activities of the cooperative, its members, its directors, or its
employees;
(m)
To conduct its business and exercise its powers within or
without the province or provinces in which its supplies service;
(n)
To adopt, amend and repeal by-laws;
(o)
To fix, maintain, implement and collect rates, fees, rents,
tolls, and other charges and terms and conditions for service: Provided,
That by appropriate rules and regulations the NEA
shall require that such shall be in furtherance of the purposes and in
conformity with the provisions of this Decree; and
(p)
To do and perform any other acts and things, and to have and
exercise any other powers which may be necessary, convenient or appropriate to
accomplish the purpose for which the cooperative is organized.
Section
17. Name. The name of a cooperative
shall include the words “Electric” and “Cooperative”, and the abbreviation
“Inc.”. The name of a cooperative
organized under this Decree shall be distinct from the name of any other
cooperative already organized or converted under this Decree. The foregoing requirement shall not apply to
any cooperative which becomes subject to this Decree by complying with the
provisions of Section 31.
Section
18. Incorporators. Five or more persons,
including cooperatives, may organize a cooperative in the manner hereinafter
provided.
Section
19. Articles
of Incorporation. The
articles of incorporation of a cooperative shall recite that they are executed
pursuant to this Decree and shall state:
(a) the name of the cooperative; (b) the address of its principal
office; (c) the names and addresses of the incorporators; and (d) the names and
addresses of its original directors, who shall constitute the board until the
first election of the board by the members; and may contain any other
provisions not inconsistent with this Decree that are deemed necessary or
advisable for the conduct of its business.
Such articles shall be signed by each incorporator and acknowledged by
at least two of the incorporators (or on their behalf, if they are
cooperatives). It shall not be necessary
to recite in the articles of incorporation the purpose for which the
cooperative is organized or any of its corporate powers.
Section
20. By-Laws. Unless reserved to the
members in the articles of incorporation, the power to adopt and thereafter to
amend or repeal by-laws shall vest in and be exercised by the board, the
affirmative votes of a clear majority of all directors in office, after due
notice to all directors, being requisite for such purpose. The by-laws shall set forth the basic rights
and duties of members and directors and may contain any other provision for the
regulation and management of the affairs of the cooperative not inconsistent
with its articles of incorporation or this Decree.
Section
21. Members. Each incorporator of a
cooperative shall be a member thereof, but no other person may become a member
thereof unless such other person agrees to use services furnished by the
cooperative when made available by it.
Membership in a cooperative shall not be transferable, except as
provided in the by-laws. The by-laws may
prescribe additional qualifications and limitations with respect to membership.
The
provision of any law or regulation to the contrary notwithstanding, an officer
or employee of the government shall be eligible for membership in any
cooperative if he meets the qualifications therefor and he shall not be
precluded from being elected to or holding any position therein, or from
receiving such compensation or fee in relation thereto as may be authorized by
the by-laws: Provided, That elective officers of the government, except barrio
captains and councilors, shall be ineligible to become officers and/or
directors of any cooperative. For this
purpose, individual permission need not be obtained from the proper head of
office: Provided, however, That this authority shall not be construed as a
permit to the government officer or employee concerned to devote official time
to the affairs of the cooperative.
Section
22. Meetings
of Members.
(a)
An annual meeting of the members of a cooperative shall be
held at such time and place as shall be provided in the by-laws.
(b)
Special meetings of the members may be called by the
President, by the board, by any three directors or, unless a smaller number or
percentage be prescribed in the by-laws, by not less than 100 members or five
per centum of all members, whichever shall be the lesser.
(c)
Except as otherwise provided in this Decree and unless
otherwise provided for in the by-laws, written or printed notice stating the
time and place of each meeting of the members and, in the case of special
meetings, the purpose or purposes for which the meeting is called, shall be
given to each member, either personally or by mail, not less than ten days nor
more than twenty- five days before the date of the meetings. If mailed, such notice shall be deemed to be
given when deposited in the Philippine mail with postage prepaid, addressed to
the member at his address as it appears on the records of the cooperative.
(d)
Unless the by-laws prescribe the presence of a greater or
lesser percentage or number of the members for such purpose, a quorum for the
transaction of business at all meetings of the members of a cooperative having
not more than 1,000 members shall be five per centum of all members, present in
person, and of a cooperative having more than 1,000 members shall be five per
centum of all members or 100, whichever is lesser, present in person. If less than a quorum is present at any
meeting, a majority of those present in person may adjourn the meeting from
time to time without further notice.
(e)
Each member shall be entitled to one vote of each matter submitted
to a vote at a meeting of the members.
Voting shall be non-cumulative and in person, but, if the by-laws so
provide, may also be by mail or by proxy.
Section
23. Waiver
of Notice. Any
person entitled to notice of a meeting may waive notice in writing either
before or after such meeting; however, his attendance shall constitute a waiver
of notice of such meeting, unless such person participates therein solely to
object to the transaction of any business because the meeting has not been legally
called or convened.
Section
24. Board
of Directors.
(a)
The business of a cooperative shall be managed by a board of
not less than five directors, each of whom shall be a member of the cooperative
or of another which is a member thereof.
The by-laws shall prescribe the number of directors, their
qualifications other than those prescribed in this Decree, the manner of
holding meetings of the board and of electing successors to directors who shall
resign, die or otherwise be incapable of acting. The by-laws may also provide for the removal
of directors from office and for the election of their successors. Directors shall not receive any salaries for
their services as such and, except in emergencies, shall not receive any
salaries for their services to the cooperative in any other capacity without
the approval of the members. The by-laws
may, however, prescribe a fixed fee for attendance at each meeting of the board
and may provide for reimbursement of actual expenses of such attendance and of
any other actual expenses incurred in the due performance of a director’s
duties.
(b)
The directors of a cooperative named in any articles of
incorporation, consolidation, merger or conversion shall hold office until the
next annual meeting of the members and until their successors are elected and
qualify. At each annual meeting of, in
case of failure to hold the annual meeting as specified in the by-laws, at a
special meeting called for that purpose, the members shall elect directors to
hold office until the next annual meeting of the members, except as otherwise
provided in this Decree. Each director
shall hold office for the term for which he is elected and until his successor
is elected and qualifies.
(c)
Instead of electing all the directors annually, the by-laws
may provide that each year half of them or one-third of them, or a number as
near thereto as possible, shall be elected on a staggered term basis to serve
two-year terms or three-year terms, as the case may be.
(d)
A majority of the board of directors in office shall
constitute a quorum.
(e)
The board shall exercise all of the powers of a cooperative
not conferred upon or reserved to the members by this Decree or by its articles
of incorporation or by-laws.
Section
25. Districts. The by-laws may provide for
the division of the territory served or to be served by a cooperative into two
or more districts for any purpose, including, without limitation, the
nomination and election of directors.
The by-laws shall prescribe the boundaries of the districts, or the manner
of establishing such boundaries, the manner of changing such boundaries, and
the manner in which such districts shall function.
Section
26. Officers. The officers of a
cooperative shall consist of a president, vice-president, secretary and treasurer,
who shall be elected annually by and from the board. When a person holding any such office ceases
to be a director, he shall ipso facto cease to hold such office. The offices of secretary and of treasurer may
be held by the same person. The board
may also elect or appoint such other officers, agent, or employees as it deems
necessary or advisable and shall prescribe their powers and duties. Any officer may be removed from office and
his successor elected in the manner prescribed in the by-laws.
Section
27. Amendment
of Articles of Incorporation. A
cooperative may amend its articles of incorporation by complying with the
following requirements: Provided, however, That a change of
location of principal office may be effected in the manner set forth in Section
28. The proposed amendment shall be
presented to a meeting of the members, the notice of which shall set forth or
have attached thereto the proposed amendment or an accurate summary thereof. If the proposed amendment, with any changes,
is approved by the affirmative vote of not less than two-thirds of the total
votes cast thereon at such meeting, articles of amendment shall be executed and
acknowledged on behalf of the cooperative by its president or vice-president
and its seal shall be affixed thereto and attested by its secretary. The articles of amendment shall recite that
they are executed pursuant to this Decree and shall state: (1) the name of the cooperative; (2) the
address of its principal office; and (3) the amendment to its articles of
incorporation. The president or
vice-president executing such articles of amendment shall make the annex
thereto an affidavit stating that the provisions of this section with respect
to the amendment set forth in such articles were duly complied with.
Section
28. Change
of Location of Principal Office. A
cooperative may, upon authorization of its board or members, change the
location of its principal office by filing a certificate reciting such change
of principal office, executed and acknowledged by its president or
vice-president under its seal attested by its secretary, in the place provided
for in Section 34.
Section
29. Consolidation. Any two or more cooperatives
(each of which is hereinafter designated a “consolidating cooperative”) may
consolidate into a new cooperative (hereinafter designated the “new
cooperative”), by complying with the following requirements:
(a)
The proposition for the consolidation of the consolidating
cooperatives into the new cooperative and proposed articles of consolidation to
give effect thereto shall be submitted to a meeting of the members of each
consolidating cooperative, the notice of which shall have attached thereto a
copy of the proposed articles of consolidation or an accurate summary thereof.
(b)
If the proposed consolidation and the proposed articles of
consolidation, with any amendments, are approved by the affirmative vote of not
less than two-thirds of the total voted cast thereon by each consolidating
cooperatives voting thereon at each such meeting, articles of consolidation in
the form approved shall be executed and acknowledged on behalf of each
consolidating cooperative by its president or vice-president and its seal shall
be affixed thereto and attested by its secretary. The articles of consolidation shall recite
that they are executed pursuant to this decree and shall state: (1) the name of each consolidating
cooperative and the address of its principal office; (2) the name of the new
cooperative and the address of its principal office; (3) a statement that each
consolidating cooperative agrees to the consolidation; (4) the names and
addresses of the directors of the new cooperative; and (5) the terms and
conditions of the consolidation and the mode of carrying the same into effect,
including the manner in which members of the consolidating cooperatives may or
shall become members of the new cooperative; and may contain any other
provisions not inconsistent with this Decree that are deemed necessary or
advisable for the conduct of the business of the new cooperative. The president or vice-president of each
consolidating cooperative executing such articles of consolidation shall make
and annex thereto an affidavit stating that the provisions of this section with
respect to such articles were duly complied with by such cooperative.
Section
30. Merger. Any one or more cooperatives
(each of which is hereinafter designated a “merging cooperative”) may merge
with one or more other cooperatives by complying with the following requirements:
(a)
The proposition for the merger of the merging cooperatives
into the surviving cooperative and proposed articles of merger to give effect
thereto shall be submitted to a meeting of the members of each merging
cooperative and of the surviving cooperative, the notice of this shall have
attached thereto a copy of the proposed articles of merger or an accurate
summary thereof.
(b)
If the proposed merger and the proposed articles of merger,
with any amendments, are approved by the affirmative vote of not less than
two-thirds of the total votes cast thereon by each cooperative voting thereon
at each such meeting, articles of merger in the form approved shall be executed
and acknowledged on behalf of each such cooperative by its president or
vice-president and its seal affixed thereto and attested by its secretary. The articles of merger shall recite that they
are executed pursuant to this Decree and shall state: (1) the name of each merging cooperative and
the address of its principal office; (2) the name of the surviving cooperative
and the address of its principal office; (3) a statement that each merging
cooperative and the surviving cooperative agree to the merger (4) the names and
addresses of the directors of the surviving cooperative, and (5) the terms and
conditions of the merger and the mode of carrying the same into effect,
including the manner in which members of the merging cooperatives may or shall
become members of the surviving cooperative and may contain any other
provisions not inconsistent with this Decree that are deemed necessary or
advisable for the conduct of the business of the surviving cooperative. The president or vice- president or each
cooperative executing such articles of merger shall make an annex thereto an
affidavit stating that the provisions of this section with respect to such
articles were duly complied with by such cooperative.
Section
31. Effect
of Consolidation or Merger.
(a)
In the case of consolidation, the existence of the consolidating
cooperative shall cease and the articles of consolidation shall be deemed to be
the articles or incorporation of the new cooperative; and in the case of
merger, the separate existence of the merging cooperatives shall cease and the
articles of incorporation of the surviving cooperative shall be deemed to be
amended to the extent, if any, that changes therein are provided for in the
articles of merger;
(b)
All rights, privileges, immunities and franchises and all
property, real and personal, including without limitation applications for
membership, all debts due on whatever account and all other chooses in action
of each of the consolidating or merging cooperatives shall be deemed to be
transferred to and vested in the new or surviving cooperative without further
act or deed;
(c)
The new or surviving cooperative shall be responsible and
liable for all liabilities and obligations of each of the consolidating or
merging cooperatives, and any claim existing or action or proceeding pending by
or against any of the consolidation or merger had not taken place, but the new
or surviving cooperatives shall be substituted in its place; and
(d)
Neither the rights of creditors nor any liens upon the
property of any such cooperatives shall be impaired by such consolidation or
merger.
Section
32. Conversion
of Existing Corporation. Any
corporation heretofore organized or registered under the Philippine Non-Agricultural Cooperative Act and supplying or having
the corporate power to supply electric energy may convert itself into a
cooperative under this Decree by complying with the following requirements, and
shall thereupon become the subject to this Decree with the same effect as if
originally organized hereunder:
(a)
The proposition for the conversion of such corporation and
proposed articles of conversion to give effect thereto shall be submitted to a
meeting of the members or stockholders of such corporation, the notice of which
shall have attached thereto a copy of the proposed articles of conversion or an
accurate summary thereof.
(b)
If the proposition for the conversion and the proposed
articles of conversion, with any amendments, are approved by the affirmative
vote of not less than two-thirds of the total votes cast thereon by members at
such meeting, and/or, if such corporation is a stock corporation or has both
members and voting stockholders, by the affirmative vote of the holders of not
less than two-thirds of those shares of the capital stock of such corporation
represented at such meeting and voting thereon, articles of conversion in the
form approved shall be executed and acknowledged on behalf of such corporation
by its president or vice-president and its seal shall be affixed thereto and
attested by its secretary. The articles
of conversion shall recite that they are executed pursuant to this Decree and
shall state: (1) the name of the
corporation and the address of its principal office prior to the conversion
into a cooperative; (2) a statement that such corporation elects to become a
cooperative, non-profit, membership corporation subject to this Decree; (3) its
name as a cooperative; (4) the addresses of the principal office of the
cooperative; and (5) the names and address of the directors of the cooperative,
and (6) the manner in which members or stockholders of such corporation may or
shall become members of the cooperative; and may contain any other provisions
not inconsistent with this Decree that are deemed necessary or advisable for
the conduct of the business of the cooperative.
The president or vice-president executing such articles of conversion
shall make and annex thereto an affidavit stating that the provisions of this
section were duly complied with in respect to such articles. The articles of conversion shall be deemed to
be the articles of incorporation of the cooperative.
Section
33. Dissolution. A cooperative may be
dissolved in the following manner: The
proposition to dissolve shall be submitted to the members of the cooperative at
any annual or special meetings, the notice of which shall set forth such
proposition. The members at any such
meeting shall approve, by the affirmative vote of not less than a majority of
all members of the cooperative, the proposition that the cooperative be dissolved
(hereinafter designated the “certificate”) shall be executed and acknowledged
on behalf of the cooperative by its president or vice-president under its seal,
attested by its secretary, stating: (1)
the name of the cooperative; (2) the address of its principal office; and (3)
that the members of the cooperative have duly voted that the cooperative be
dissolved. Also, an affidavit, made by
its president or vice-president executing the certificate, shall state that the
statements in the certificate are true.
Upon the filing of the certificate and affidavit as provided for in
Section 34, the cooperative shall cease to carry on its business except to the
extent necessary for the winding up thereof, but its corporate existence shall
continue until articles of dissolution shall have been filed. The board shall immediately cause notice of
the dissolution proceedings to be mailed to each known creditor of and claimant
against the cooperative and to be published once a week for two successive
weeks in a newspaper of general circulation in the territory in which the
principal office of the cooperative is located.
The board shall wind up and settle the affairs of the cooperative,
collect sums owing to it, liquidate its property and assets, pay an discharge
its debts, obligations and liabilities, other than those patrons arising by
reason of their patronage, and do all other things required to wind up its
business; and, after paying or discharging or adequately providing for the
payment or discharge of all its debts, obligations and liabilities, other than
those to patrons arising by reason of their patronage, shall distribute any
remaining sums and/or unliquidated assets, first, to patrons for the pro rata
return of all amounts standing to their credit by reason of their patronage;
second, to members for the pro rata repayment of membership fees; and third, to
patrons for the amounts of any outstanding contributions in aid of construction
they have made. Any sums and/or
unliquidated assets then remaining shall be distributed in such manner as
provided in the cooperative’s articles of incorporation or by-laws, which may
provide for distribution of such sums or assets on a patronage basis to persons
who were members in one or more prior years or for transfer thereof to a new
cooperative to succeed the one being dissolved.
The board shall thereupon authorize the execution of articles of
dissolution, which shall be executed and acknowledged on behalf of the
cooperative by its president or vice-president, and its seal shall be affixed
thereto and attested by its secretary.
The articles of dissolution shall recite that they are executed pursuant
to this Decree and shall state: (1) the
name of the cooperative; (2) the address of its principal office; (3) the date
on which the certificate of election to dissolve was filed; (4) that there are
no actions or suits pending against the cooperative; (5) that all debts,
obligations and liabilities of the cooperative have been paid and discharged or
that provision to the extent possible has been made therefor; and (6) that the
provisions of this section have been duly complied with. The president or vice-president executing the
articles of dissolution shall make the annex thereto an affidavit stating that
the statement made therein are true.
Section
34. Filing
of Articles and Certificates. Articles
of incorporations, amendment, consolidation, merger, conversion, or dissolution
and certificates of changes in the location of principal offices and of
elections to dissolve, when executed and acknowledged and accompanied by such
affidavits as may be required by applicable provisions of this Decree, shall be
presented to the Administrator for filing in the records of his office. If he shall find that such conform to the
requirements of this Decree, he shall so certify and shall file such in the
records of his office. Upon such
certification and filing, the incorporation, amendment, consolidation, merger,
conversion, dissolution or certificate provided for therein shall be in effect.
Section
35. Non-profit,
Non-discriminatory, Area Coverage Operation and Service. A cooperative shall be
operated on a non-profit basis for the mutual benefit of its members and
patrons; shall, as to rates and services make or grant no unreasonable
preference or advantage to any member or patron nor subject any member or
patron to any unreasonable prejudice or disadvantage; shall not establish or
maintain any unreasonable difference as to rates or services either as between
localities or as between classes of service; shall not give, pay or receive any
rebate or bonus, directly or indirectly, or mislead its members in any manner
as to rates charged for its services; and shall furnish service on an area
coverage basis: Provided, That for any extension of service which if treated on the
basis of standard terms and conditions is so costly as to jeopardize the
financial feasibility of the cooperative’s entire operation, the cooperative
may require such contribution in aid of construction, such facilities extension
deposit, such guarantee of minimum usage for a minimum term or such other
reasonable commitment on the part of the person to be served as may be
necessary and appropriate to remove such jeopardy, but no different in standard
rates for use of service shall be imposed for such purpose.
The by-laws
of a cooperative or its contracts with members and patrons shall contain such
reasonable terms and conditions respecting membership, the furnishing of
service and the disposition of revenues and receipts as may be necessary and
appropriate to establish and maintain its non-profit, cooperative character and
to ensure compliance with this section.
No bona fide applicant for membership on non-member patronage who is
able and willing to satisfy and abide by all such terms and conditions shall be
denied arbitrarily, capriciously or without good cause.
Section
36. Disposition
of Property.
(a)
The board of a cooperative shall have full power and
authority, without authorization by the members thereof, to authorize the
execution and delivery of a mortgage or a deed of trust, or the pledging or
encumbering otherwise, of any or all of the property, assets, rights,
privileges, licenses, franchises and permits of the cooperative, whether
acquired or to be acquired, and whenever situated, as well as the revenues
therefrom, all upon such terms and conditions as the board shall determine, to
secure any borrowing by or indebtedness of the cooperative.
(b)
A cooperative may not otherwise sell, lease or, except by
consolidation or merger, otherwise dispose of the property (other than
merchandise and property which shall represent not in excess of ten per centum
of the value of the cooperative’s total assets, or which in the judgment of the
board are not necessary or useful in operating the cooperative) unless such
sale, lease or, except in the case of consolidation or merger, other
disposition is (1) authorized by the affirmative vote of not less than a
majority of all members of the cooperative and (2) consented by the NEA and any other lending source which then
holds a lien on any of the cooperative’s properties.
Section
37. Non-Liability
of Members for Debts of Cooperative. No
member shall be liable or responsible for any debts of the cooperative and the
property of the members shall not be subject to execute therefor.
Section
38. Limitation
of Actions. No
action or suit may be brought against a cooperative, or against any agent,
servant or employee thereof, by reason of the maintenance of electric transmission
or distribution lines, or any related equipment, facilities or machinery, or
any real property after the expiration of a period of five (5) years of
continuous maintenance of such lines or related equipment facilities or
machinery.
Section
39. Assistance
to Cooperatives; Exemption from Taxes, Imposts, Duties, Fees; Assistance from
the National Power Corporation. Pursuant to the national policy
declared in Section 2, the Congress hereby finds and declares that the
following assistance to cooperative is necessary and appropriate:
(a)
Provided that it operates in conformity with the purposes and
provisions of this Decree, cooperatives (1) shall be permanently exempt from
paying income taxes, and (2) for a period ending on December 31; of the
thirtieth full calendar year after the date of a cooperative’s organization or
conversion hereunder, or until it shall become completely free of indebtedness
incurred by borrowing, whichever event first occurs, shall be exempt from the
payment (a) of all National Government, local government and municipal taxes
and fees, including franchise, filing, recordation, license or permit fees or
taxes and any fees, charges, or costs involved in any court or administrative
proceeding in which it may be a party, and (b) of all duties or imposts on
foreign goods acquired for its operations, the period of such exemption for a
new cooperative formed by consolidation, as provided for in Section 29, to
begin from as of the date of the beginning of such period for the constituent
consolidating cooperative which was most recently organized or converted under
this Decree: Provided, That the Board of Administrators shall, after consultation
with the Bureau of Internal Revenue,
promulgate rules and regulations for the proper implementation of the tax
exemptions provided for in this Decree.
(b)
The National Power
Corporation shall, except with respect to the National Government, give
preference in the sale of its power and energy to cooperatives, and shall
otherwise provide the maximum support of and assistance to cooperatives of
which it is capable, including assistance in developing dependable and reliable
arrangements for their supplies of bulk power, either from itself, or from
other sources. In pursuance of the
foregoing policy, the National Power
Corporation shall not, except upon prior written agreement approved by the
cooperative’s board, compete in the sale of power and energy which without
regard to the location of the point of delivery thereof, will be utilized and
consumed within any area franchised to a cooperative.
Section
40. Exemption
from Board of Power and Waterworks and Securities Exchange Commission.
(a)
Cooperatives shall be exempt from regulation by the Board of
Power and Waterworks.
(b)
The provisions of the Securities
Act shall not apply to any note, bond or other evidence of indebtedness
issued by any cooperative or to any mortgage, deed of trust, indenture or other
instrument executed to secure the same.
The provisions of said Act shall not apply to the issuance of membership
certificates or any other evidence of member or patron interest by a
cooperative.
CHAPTER IV
Franchises; Regulation of Cooperatives
Section
41. Applicability. This Chapter shall apply
only to electric franchises as defined in Section 3. It shall not be applicable to franchises for
any other utility service or to those separable portions of franchises covering
any other type of utility service though such franchises may also cover
electric service. The Board of
Administrators shall hear and determine all questions which may arise under
this Section.
Section
42. Repeal
of Franchise Powers of Municipal, City and Provincial Governments. The powers of municipal,
city and provincial governments to grant franchises, as provided for in Title
34 of the Philippines Statutes or in any special law, are hereby repealed: Provided,
That this section shall not impair or invalidate any franchise heretofore
lawfully granted by such a government or repeal any other subsiding power of
such governments to require that electric facilities and related properties be
so located, constructed, operated and maintained as to be safe to the public
and not to unduly interfere with the primary use of streets, roads, alleys and
other public ways, buildings and grounds over, upon or under which they may be
built.
Section
43. Franchising
Powers Delegated to the NEA. The power hereafter to grant
and thereafter to repeal, alter or amended new franchises, to repeal, alter or amend
all franchises heretofore granted by the Congress (or by the President or by
the National Assembly after it comes into existence), and to repeal, alter or
amend all franchises heretofore granted by any municipal, city or provincial
government, is hereby delegated to the NEA,
whose Board of Administrators shall, acting as a Commission, administer the
provisions of this Chapter. Provisions
of Republic Act 2677 to the country notwithstanding, no municipality shall hereafter
initiate the operation, or after December 31, 1973, continue any operation
heretofore initiated, of any service for sale at retail unless it shall first
obtain a franchise from the NEA in
accordance with the provisions of this Chapter.
In exercising the powers herein delegated, the NEA shall at all times seek to serve the
National objective of the most rapid total electrification of the
(a)
Within one hundred eighty days after the effective date of
this Chapter (and periodically thereafter, at least once annually) to notify
and require every person holding a franchise to report to it, within not less
than ninety days after such notice, an accurate description of the geographic
area encompassed in such franchise, the number of households therein receiving
adequate and dependable service, the number of households therein receiving
service which is not adequate and dependable, the number and type of other
retail customers therein receiving adequate and dependable service or service
which is not adequate and dependable, the approximate total number of
households therein, the date such franchise was granted and such other
information and data as the NEA for the
purpose of implementing this section may require, and, on the basis of such
reports and otherwise, including complaints:
1.
to review such franchises to determine whether the holders
thereof are furnishing service on an area coverage basis or are engaged in
effective measures to furnish such service within a reasonable time;
2.
to repeal and cancel any franchise if the NEA finds that the holder thereof is not then
furnishing, and is unable or unwilling within a reasonable time to furnish,
adequate and dependable service on an area coverage basis within such area; and
3.
to alter and condition such or other existing franchises and
to issue new franchises to the end of assuring area coverage service throughout
the Nation as in this Decree contemplated:
Provided, That no franchise
shall be altered, conditioned, repealed or cancelled, and no franchise shall be
granted, without first affording the holder thereof, or the contending
applicants therefor, if such be the case, and any other interested parties
opportunity for hearing; and
(b)
Upon determining, after affording opportunity for hearing to
all interested parties, that such is necessary or appropriate to assure or
expedite the furnishing of service on an area coverage basis, to require any
public service entity to interconnect its generation, transmission or
distribution facilities or related facilities with, and through such
interconnection to exchange, sell or purchase power and energy with, to or from
or to transmit power and energy on behalf of, any other public service entity
or, if it so requests or consents, the NPC;
and, if such public service entities (and, if such be the case, the NPC) are unable between or among themselves
to agree upon such, to establish the manner and degree, to fix and apportion
the financial responsibility and sharing of costs, and to determine the other
terms and conditions of such interconnection, exchange, sale, purchase or
transmission: Provided, however, That the provisions of Section 45 to the
contrary notwithstanding, the provisions of this paragraph shall apply to
industrial plants, factories, mills, mines and similar or other power
generating entities in which case they shall qualify as public service entities
for purposes of Section 4 (f) .
Section
44. Preference
to Cooperatives. Whenever
two or more public service entities are affected by and have competing or
conflicting interests with respect to the granting, repeal, alteration or
conditioning of the same franchise or franchises, and one or more of such
entities are cooperatives, the NEA shall
accord preference to a cooperative over any other type of public service entity
( and shall prefer one cooperative over another) unless and except to the
extent that an order in favor of another type of public service entity (or of
another cooperative) will, as found by the NEA,
result both earlier and ultimately in the furnishing and extending of area
coverage service (1) to a greater number of households, (2) over a larger
geographic area, and (3) on the basis of the same or lower rates, charges and
fees.
Section
45. Furnishing
Service Without a Franchise Prohibited. No
person shall furnish or extend service to the public within any area for which
such person has not been granted a franchise or after such a franchise has been
repealed and cancelled or so conditioned or altered as to prohibit service therein: Provided,
That such service may be continued and extended therein, and the NEA, after affording opportunity for hearing
to any interested party, may by order require that it be so continued and
extended until service to the customers of such person is made available by a
public service entity lawfully authorized to serve therein.
Section
46. Additional
Regulation of Cooperatives by the NEA. In addition to the other
ways in which cooperatives are subject to regulation by the NEA as provided in this Decree, the NEA, on its own motion or upon complaint but
only after affording opportunity for hearing to all interested parties, is
empowered to and shall (1) require a cooperative to extend or improve service
upon the NEA’s determination that such
should be done in furtherance of the purposes of this Decree and that such may
reasonably be done without undue impairment of the feasibility of the
cooperative’s operation and financial condition; and (2) require a cooperative
to cease and correct any practice or act which the NEA determines to be in violation of the
provisions of Section 35, and in connection with such authority it may require
a cooperative to file with the NEA, and to
make accessible to any person upon request therefor, copies of all rates,
charges, contract forms, fee or deposit schedules, by-laws, and service rules
and regulations.
Section
47. Hearings
and Investigations. The NEA is empowered to conduct such hearings and
investigations and to issue such orders as are necessary for it to implement
the provisions of this Chapter, and in connection therewith, without necessary
of previous hearing, to require any public service entity or the officials
thereof to furnish to it such information and data, including statements of
accounts, schedules of rates fees and charges, contracts, service rules and
regulations, articles of incorporation, by-laws, audit reports and other
internal records, documents, policies and procedures, as will enable the NEA to be sufficiently informed in exercising
its powers and authorities: Provided, That no order shall issue
finally determining and substantially affecting any right of any person subject
to the NEA’s jurisdiction without first
affording such person and any other interested person opportunity for hearing
as a party in the hearing proceeding.
Section
48. Parties and Intervenors in NEA’s Proceedings. Public service entities or any other
interested person may invoke the NEA’s
exercise of its powers and authorities provided for in Section 43, 44, 45, 46
and 47 by filing verified applications or complaints with the NEA, and the NEA,
on its own motion solely, may institute proceedings in connection with all maters
coming under its jurisdiction as provided for in said sections. In any proceeding conducted by the NEA, including proceedings to establish NEA rules and regulations, all persons having
a substantial interest therein shall, upon petition therefor, be permitted by
the NEA to intervene as full parties, and
the NEA, in its discretion, may permit
persons having an insubstantial interest therein to intervene as a full party
or on such limited basis as the NEA may
prescribe.
Section
49. NEA Rules and Regulations. The NEA shall establish appropriate rules and
regulations to carry out the provisions of this Chapter IV, including rules for
the conduct of NEA investigations,
proceedings and hearing; and shall timely publish the same when adopted or
amended to the end that all persons affected thereby shall be given reasonable
notice thereof.
Section
50. Notice.
(a)
With respect to any NEA proceeding,
investigation or hearing (including such as are for the purpose of establishing
NEA rules and regulations) which may
substantially affect the rights or interests of any person or persons
(including the general public or the National Government or any department,
agency, instrumentality of political subdivision thereof, if such be the case)
, the NEA shall cause timely notice in
writing to be furnished to, or served upon, or appropriately published to such
person or persons to the end of affording them reasonable opportunity, as a
party or otherwise, directly to participate, or otherwise to have their
positions, views and interests adequately presented to or represented, in such
proceedings, investigation or hearing.
(b)
Upon the completion of any such proceeding, investigation or
hearing, the NEA shall cause timely notice
of any order issuing thereupon to be furnished to, or served upon, or
appropriately published to any person or persons (including the general public
or the National Government or any department, agency, instrumentality or
political subdivision thereof, if such be the case) who will be directly
affected thereby. Such notice shall be
supplementary to, not in conflict with or in lieu of, the notices and services
otherwise provided for in this Chapter.
Section
51. Hearings
Conducted by Board of Administrators or any Member Thereof. NEA hearings pursuant to this Chapter may be
conducted by the Board of Administrators en
banc or by any one or more members thereof, as the Board of Administrators
may decide: Provided, That the Administrator shall preside when the Board of
Administrators sits en banc: Provided,
further, That all hearings shall be of record; and Provided finally, that findings, determinations, orders and rulings
based upon such hearings shall require the affirmative majority of all the
members of the Board of Administrators upon the certification, to become a part
of such findings, determinations and orders, on the part of any member of the
Board who was absent from the hearings that he has read the record of the same.
Section 52. Compensation. The members of the Board of
Administrators and other hearing officers as the Board of Administrators may
designate shall be entitled to per diem for each hearing actually conducted or
attended by them in such amount as may be fixed by the President of the
Section
53. Hearing
Rules; Contempt. All
hearings and investigations conducted by the NEA
shall be governed by rules adopted by the NEA,
and in the conduct thereof the NEA shall
not be bound by the technical rules of legal evidence: Provided,
That the NEA or such member of the Board
of Administrators when conducting a hearing, may summarily punish for contempt
by a fine not exceeding two hundred pesos (P 200.00) or by imprisonment not
exceeding ten (10) days, or both, any person guilty of misconduct in the
presence of the hearing or so near the same as to interrupt the hearing,
proceeding, session or investigation including cases in which a person present
at a hearing, proceeding, session or investigation refuses to be sworn as a
witness or to answer as such when lawfully required to do so. To enforce the provisions of this section,
the NEA, or such member thereof, may, if
necessary, request the assistance of the municipal police for the execution of
any order made for said purpose.
Section 54. Subpoenas; Contempt.
(a)
The NEA may issue
subpoenas and subpoenas duces
tecum, for witness in any matter of inquiry pending before it, and require
the production of all books, papers, tariffs, contracts, agreements, and all
other documents which it may deem necessary in any proceeding. Such process shall be issued under the seal
of the NEA, signed by one of the members
of the NEA Board of Administrators, and
may be served by any person of full age, or by registered mail. In case of disobedience to such subpoena, the
NEA may invoke the aid of the Supreme Court, or of any Court of
First Instance of the Philippines in requiring the attendance and testimony of
witnesses and the production of books, papers and documents under the provision
of this Chapter, and the Supreme
Court, or any Court of First Instance of the Philippines within the
jurisdiction of which such inquiry is carried on, may, in case of contumacy or
refusal to obey a subpoena, issue to any public service entity subject to the
provisions of this Decree, or to any person, an order requiring such public
service entity or person to appear before the NEA
and produce books and papers if so ordered and give evidence touching the
matter in question; and any failure to obey such order of the Court may be
punished by such court as contempt thereof.
(b)
Any person who shall neglect or refuse to answer any lawful
inquiry or produce before the NEA books,
papers, tariffs, contracts, agreements, and documents, or other things called
for by the NEA if his power to do so, in
obedience to the subpoena or lawful inquiry of the NEA, upon conviction thereof by a court of
competent jurisdiction, shall be punished by a fine not exceeding five thousand
pesos (P5,000.00) or by imprisonment not exceeding one year, or both in the
discretion of the court;
(c)
Any NEA Board Member
shall have the power to administer oaths in all matters under the jurisdiction
of the NEA;
(d)
Any person who shall testify falsely or make any false
affidavit or oath before the NEA or before
any of its members shall be guilty of perjury, and, upon conviction thereof in
a court of competent jurisdiction, shall be punished as provided by law;
(e)
Witnesses appearing before the NEA in obedience to subpoena or subpoena duces tecum shall be entitled to receive the same fees and
mileage allowance as witnesses attending Courts of First Instance in civil
cases;
(f)
Any person who shall obstruct the NEA or any member of the NEA Board while engaged in the discharge of
official duties, or who shall conduct himself in a rude, disrespectful or
disorderly manner before the NEA or any NEA Board Member while engaged in the
discharge of official duties, or shall orally or in writing be disrespectful
to, offend or insult any of the NEA board
members on occasion or by reason of the performance of official duties, upon
conviction thereof by a court of competent jurisdiction, shall be punished for
each offense by a fine not exceeding one thousand pesos (P 1,000), or by
imprisonment not exceeding six months, or both, in the discretion of the court.
Section 55. Testifying. No person shall be excused
from testifying or from producing any book, document, or paper in any
investigation or inquiry by or upon the hearing before the NEA when ordered so to do by the NEA, except when the testimony or evidence
required of him may tend to incriminate him.
Without the consent of the interested party, no member or employee of
the NEA shall be compelled or permitted to
give testimony in any civil suit to which the NEA
is not a party, with regard to secrets obtained by him in the discharge of his
official duty.
Section
56. Depositions. The NEA may, in any investigation, proceeding or
hearing, by its order in writing, cause the deposition of witnesses residing
within or without the
The Board
may also, by proper order, authorize any of the attorneys of the legal division
or division chiefs of the NEA to hear and
investigate any case filed with the NEA or
any matter within the jurisdiction of the NEA
and in connection therewith to receive such evidence as maybe material
thereto. At the conclusion of the
hearing or investigation, the attorney or division chief so authorized shall
submit the evidence received by him for the Board of Administrators to enable
the latter to render its decision.
Section
57. Service. Every order made by the NEA shall be served upon the person or public
service entity affected thereby within ten (10) days from the time said order
is filed, by personal delivery or by ordinary mail, upon the attorney of record
or, in case there be no attorney of record, upon the party interested; and in
case a certified copy is sent by registered mail, the registry mail receipt
shall be prima facie evidence of the receipt of such order by the public
service entity in due course of mail.
Section
58. Reconsideration. Any interested party may
request the reconsideration of any order, ruling, or decision of the NEA by means of a petition filed not later
than fifteen (15) days after the date of the notice of the order, ruling, of
decision in question. The grounds on
which the request for reconsideration is based shall be clearly and specifically
stated in the petition. Copies of said
petition shall be served on all parties interested in the matter. It shall be the duty of the NEA to decide the same within thirty (30)
days, either denying the petition or revoking or modifying the order, ruling,
or decision under consideration. If no
petition for reconsideration is filed, no review by the Supreme Court as hereinafter
provided shall be allowed.
Section
59. Court
Review. The Supreme Court is hereby given
jurisdiction to review any order, ruling, or decision of the NEA and to modify or set aside such order,
ruling, or decision when it clearly appears that there was no evidence before
the NEA to support reasonably such order,
ruling, or decision, or that the same is contrary to law, or that it was
without the jurisdiction of the NEA. The evidence presented to the NEA, together with the record of the
proceedings before the NEA, shall be
certified by the NEA to the Supreme Court. Any order, ruling, or decision of the NEA may likewise be reviewed by the Supreme Court upon a writ of certiorari
in proper cases. The procedure for
review, except as herein provided, shall be prescribed by rules of the Supreme Court. Any order, ruling, or decision of the NEA may be reviewed on the application of any
person or public service entity aggrieved thereby and who was a party in the
subject proceeding, by certiorari in appropriate cases or by a petition for
review, which shall be filed within thirty (30) days from the notification of
the NEA order, decision, or ruling or
reconsideration. Said petition shall be
placed on file in the office of the Clerk
of the Supreme Court who shall furnish copies thereof to the NEA and other interested parties.
Section
60. No
Stay. The institution of a
writ of certiorari or other special remedies in the Supreme Court shall in no case
supersede or stay any order, ruling, or decision of the NEA unless the Court shall so direct, and the
appellant may be required by the Court
to give bond in such form and of such amount as may be deemed proper.
Section
61. NEA Council.
The chief of the legal division or any other attorney of the NEA shall represent the same in all judicial
proceedings. It shall be the duty of the
Solicitor General to represent the NEA in any judicial proceeding if, for
special reasons, the administrators shall request his intervention.
CHAPTER V
Transitory Provisions
Section
62. Existing
NEA Continued.
(a)
The existing Board of Administrators of the NEA and the Administrator thereof shall be
the Board of Administrators and Administrator provided for under this Decree,
and their respective terms shall be and continue as already established.
(b)
Any preference to the NEA
in any existing law or in any executive order or proclamation of the President
shall, with respect to any duty or function assumed by the NEA pursuant to said Decree, be deemed
hereafter to have reference to the NEA
established under this Decree;
(c)
The properties, assets, rights, chooses in action, obligations,
liabilities, records and contracts of the NEA
are hereby transferred to and are vested in, and assumed by the NEA established under this Decree;
(d)
All personnel of the NEA
shall be absorbed and transferred to the NEA
established under this Decree without demotion in rank nor reduction in salary;
and
(e)
All on-going projects and/or approved loans of the NEA established under Republic
Act No. 6038 shall be reviewed by the NEA
established under this Decree and, insofar as found to be economically feasible
in accordance with sound management, engineering and technological standards,
shall be continued and completed on a priority basis.
Section
63. Separability
of Provisions. If
any provision of this Decree, or the application of such provision to any
person or circumstance, is declared invalid, the remainder of the Decree or the
application of such provision to other persons or circumstances shall not be
affected by such declaration.
Section
64. Effect
on Other Acts. All
acts or parts of Acts inconsistent herewith are repealed or modified
accordingly.
Section
65. Effectivity. This Decree shall take
effect immediately.
Done in the
City of
What do you want to do now?
Go Back to the Top; Go back to art’s home page; Laugh or Be Entertained; Destroy Cartels and Monopolies; Invest or Find a Job; Check Software or a Computer; Check out the latest News; Look for a School; Greet a Friend; Dip Into Black Gold and be Electrified; Express Yourself; Relive the Past; Get Involved in the Law, Government, & Politics; Read Some Classics; Meet New People; Consult the laws of the Philippine energy sector; Philosophize; or Search.
This page is best viewed using Microsoft Internet Explorer 4.0 or higher.
Last revised: November 22, 2008 01:47 PM.
Caveat Emptor: Owners of the sites included herein do not explicitly endorse this page.
Comments, suggestions, objections, or violent reactions?