1. Regulatory Governance in the Philippines: A Profile Ledivina V
Regulatory Governance in the Philippines: A Profile Ledivina V. Carino et al

2. Outline Introduction to Philippine concept of regulatory governance
Constitutional and legal framework
Institutional framework
Regulatory mechanisms at work
Research agenda

3. The Philippines: a Brief Socio-Economic Profile
The Philippines’ economic system has evolved from the country’s long experience of colonial rule.
1950s “Filipino First Policy” aimed to achieve economic independence.
Significant deregulation, liberalisation and aggressive privatisation since 1980s

4. The Philippine Economy

5. Regulatory Governance
Definition: How regulation and competition are managed to achieve societal goals
View of regulatory governance
Not a monopoly of the state
Control, influence, incentives, enabling, facilitating
Change of context of doing business
Devolution / Globalisation

6. The Legal Framework
The 1987 Constitution and the entry of the Philippines into the World Trade Organisation often complementary, sometimes conflicting.
The 1987 Constitution is very nationalistic – as had been articulated by earlier Constitutions.
It has provisions in (limited) support of free enterprise.

7. Aims of Regulatory Governance
For economic growth
To encourage private enterprise
For country’s integrity as a sovereign state and as a democracy
In the service of poverty alleviation and other issues of the public interest

8. The Nationalistic Constitutional Framework
protect Filipino enterprises against unfair foreign competition and trade practices (Sec.1)
encourage the formation and operation of enterprises whose capital is wholly owned by Filipinos (Par. 1, Sec. 10)

9. The Nationalistic Constitutional Framework
“The State shall develop a self-reliant and independent national economy effectively controlled by Filipinos.”
regulate and exercise authority over foreign investments (Par. 3, Sec. 10)
preference to qualified Filipinos in the granting of rights, privileges, and concessions (Par. 2, Sec. 10)

10. The Nationalistic Constitutional Framework
promote the preferential use of Filipino labour, domestic materials and locally produced goods (sec. 12)
Limit participation of foreign investors in board and may not be executives of public utilities
Limit practice of profession except as prescribed by law

11. The Nationalistic Constitutional Framework
Nationality-indifferent and market-oriented policies have burden of proof of not contravening the Constitution.
Examples
Luzon Petrochemical site (1990)
Manila Hotel (1997)
Phil Shipyard (2000)

12. Constitutionally Limited Support to Free Enterprise
“The State recognises the indispensable role of the private sector, encourages private enterprise and provides incentives to needed investments.”
BUT State may intervene in the economy
To promote distributive justice
When common good so demands

13. Laws Regulating the Economy
Regulate the conduct of business
Restrict entry and competition
Devolve regulation

14. Laws Regulating the Conduct of Business
a socially conscious, free market that regulates itself
encourage the widest participation of ownership
enhance the democratisation of wealth
ensure fairness and transparency

15. Laws Regulating the Conduct of Business
Incentives for investments (except security, health and morals and constitutional bans)
Deregulation in banking, telecoms, transportation
Trade liberalisation (ex. Retail trade)
Commitments to WTO (ex. money laundering law)

16. Laws Restricting Entry and Competition
nationalistic restrictions:
Safeguard Measures Act (RA 8800)
non-nationalistic restrictions:
public utility franchising
monopoly rights given to public enterprises
licensing, and rules to remove barriers to competition

17. Law Devolving Regulation
Devolved areas: Health, agriculture, social welfare, environment
Others explicitly granted: agricultural lands, zoning, local transport#
Business licenses and permits
For comfort and convenience of inhabitants
Local Government Code of 1991 (RA 7160)

18. Institutional Framework
Legislative Involvement in Regulation
House of Representatives: Legislative Franchises; Trade and Industry; Banks and Financial Intermediaries; Economic Affairs; and a special committee on entrepreneurship development.
Senate: Economic Affairs; Trade and Commerce; Public Services; and Banks and Financial Institutions
The Judiciary
Checks and balances: The E-VAT Law

19. The Regulatory Agencies
19 government agencies primarily in economic regulation
Balance of involvement and independence
Governing body: collegial? Qualifications?
Autonomy: where in admnistrative system?
Fiscal autonomy and accountability
Appeal from decisions

20. Banking and Finance
Bangko Sentral ng Pilipinas (BSP, the new Central Bank)
Securities and Exchange Commission (SEC)
Philippine Deposit Insurance Corporation (PDIC)
Office of the Insurance Commissioner (OIC)

21. Trade and Commerce Department of Trade and Industry (DTI)
Bureau of Product Standards (BPS)
Bureau of Trade Regulation and Consumer Protection (BTRCP)
Board of Investments (BOI)
Tariff Commission (TC)

22. Water Utilities National Water Resources Board (NWRB)
Metropolitan Waterworks and Sewerage System- Regulatory Office (MWSS-RO)

23. Energy
Department of Energy (DOE)
Energy Regulatory Commission (ERC)

24. Transport and Communications
Civil Aeronautics Board (CAB)
Maritime Industry Authority (MARINA)
Land Transportation Franchising and Regulatory Board (LTFRB)
Air Transportation Office (ATO)
National Telecommunications Commission (NTC)

25. Labor Sector Philippine Overseas Employment Administration (POEA)
Occupational Health and Safety Center (OSHC)

26. Organizational Status

27. Governing Bodies

28. Membership of Boards/Commissions
Terms of Office: BSP, SEC, PDIC, ERC and BOI have terms fixed by law
Qualifications
generally relate to “recognized competence” in an academic field
conflict of interest

29. Fiscal Autonomy
independent from the outside control re-management of financial resources
PDIC
BSP
dependent on annual government appropriations

30. System of Review over Decisions of Regulatory Agencies

31. Accountability To State: audit of finances and performance
To regulated
To clients and public at large
As civil servants

32. Challenges of Regulatory Governance
Overlapping jurisdictions and divergent views of the public interest (ex. Cement importation)
Self-regulatory mechanisms
Independence of the regulators

33. Overlapping Jurisdictions: The Case of the Cement Industry
jurisdiction over the imposition of safeguard measures
definition of public interest from different perspectives
nationalism amidst globalization

34. Self-Regulating Organisation
Philippine Stock Exchange (PSE)
the composition of the board
the exchange must be de-mutualised
Philippine Council for NGO Certification (PCNC)

35. Independence of Regulators
MWSS-RO case
the RO has no legal character
RO’s relation to the Concessionaires
RO’s powers and functions

36. Research Agenda Philosophical and Ethical Underpinnings
Nationalism vs Globalisation
Corruption and Regulation
Challenges of Regulatory Governance

37. Challenges to Regulatory Governance
Regulation and Competition Policy
Political Economy of Regulation (Power sector)
Privatisation and Regulation (MWSS Regulatory Office)
Regulation and Access of the Poor (Telecoms)
Regulation by local government or the private sector

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