Rep. Gonzales prefers fixed rate of foreign ownership in Cha-cha

MANILA, Philippines — If it were up to him, House of Representatives Senior Deputy Speaker Aurelio Gonzales Jr. would include a fixed rate of foreign ownership in the proposed amendments to the 1987 Constitution.

In a press briefing on Tuesday, Gonzales and other lawmakers were asked about possible challenges to the economic Charter change due to the proposed insertion of the phrase “unless otherwise provided for by law” in three economic provisions in the Constitution.

In response, Gonzales said he prefers that a specific rate be placed — whether it be 60 percent or 70 percent in favor of foreign companies.

“Unless otherwise provided by law, if only you heard me, I was looking for a 60-40 split, 60-40, and then 70-30 split, I believe we should give a figure as to how much the rate of foreign ownership really is, so that we would no longer craft laws,” Gonzales said in Filipino.

“That’s what I am hoping for so that we can immediately use these provisions [to allow foreign investments].  That’s what I said if only you heard what I said when I gave an opening statement for RBH (Resolution of Both Houses No.) 7,” he added.

Under RBH No. 7 — which was mimicked from the Senate’s RBH No. 6 — three provisions in the 1987 Constitution would be amended by adding the phrase “unless otherwise provided by law”:

• Section 11 of Article XII (National Patrimony and Economy), where the phrase “unless otherwise provided by law” is inserted in the provision that bars foreign ownership of a public utility shall except in a case where 60 percent of the total capital belongs to Filipino citizens.
• Section 4 of Article XIV (Education, Science and Technology, Arts, Culture, and Sports) where the phrase “unless otherwise provided by law” is inserted in the provision that bars foreign ownership of basic educational institutions except in a case where 60 percent of the total capital belongs to Filipino citizens.
• Section 11 of Article XVI (General Provisions) where the phrase “unless otherwise provided by law” is inserted in two portions: first, the provision that bars foreign ownership in the advertising industry except in a case where 70 percent of the total capital belongs to Filipino citizens; and in the provision that limits foreign investors participation in entities to how much their capital share is.

If the proposed amendments are approved by the House and the Senate and are ratified in a plebiscite, Congress can pass laws that would prescribe the rate of foreign ownership for these industries.

The ‘unless otherwise provided by law’ phrase

Many sectors however have raised concerns regarding the insertion of the phrase “unless otherwise provided by law” — including officials from the Department of Education who feared that amendments may lead to foreign influence on basic education.

Previously, retired Chief Justice Reynato Puno urged the House to refrain from using the phrase, saying that the items in question should be repealed instead.

Puno explained that amendments made through legislation — or enacting bills that would specify how much foreign businesses can own in the industries that would be opened — may be questioned for their constitutionality.

Then, last February 27, former lawmaker and current Bayan Muna chairperson Neri Colmenares warned that leaving it to Congress to determine the rate of foreign ownership would centralize powers to the legislature.

Colmenares also warned that if the proposed amendments take place, it would put Congress closer to lobbying from businesses that seek to place provisions that would favor them — and in effect, bring in lobbying money to the legislature.

However, economic Charter change supporters like Marikina 2nd District Rep. Stella Quimbo and PBA party-list Rep. Migs Nograles stressed that using the phrase “unless otherwise provided by law” is necessary to allow flexibility, as Congress can easily change the rate of foreign ownership without amending the Constitution again.

READ: Ex-justice backs House: Key phrase in Charter amendment necessary

In the same briefing, Nograles said that they prefer that the next editions of the Congress be the ones to determine the rate of foreign ownership for the industries of public utilities, basic education, and advertising.

“We will leave it up to the wisdom of the next few Congresses to really know what is really correct for that specific timeframe so that they can just pass laws that would be more in line,” Nograles said.

“We cannot put a certain number right now on the percentages on several aspects because we cannot know what’s good today (is the same as) what would be good for the people in the next few years, in the next ten years.  The Constitution is 37 years old already, right?” she added.