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On 27 November 1990, Cory issued Executive Order 438 which imposed, in addition to any
other duties, taxes and charges imposed by law on all articles imported into the Philippines,
an additional duty of 5% ad valorem. This additional duty was imposed across the board on
all imported articles, including crude oil and other oil products imported into the Philippines.
In 1991, EO 443 increased the additional duty to 9%. In the same year, EO 475 was passed
reinstating the previous 5% duty except that crude oil and other oil products continued to be
taxed at 9%. Garcia, a representative from Bataan, avers that EO 475 and 478 are
unconstitutional for they violate Sec 24 of Art 6 of the Constitution which provides: All
appropriation, revenue or tariff bills, bills authorizing increase of the public debt, bills of local
application, and private bills shall originate exclusively in the House of Representatives, but
the Senate may propose or concur with amendments. He contends that since the
Constitution vests the authority to enact revenue bills in Congress, the President may not
assume such power of issuing Executive Orders Nos. 475 and 478 which are in the nature
of revenue-generating measures.
Issue: Whether or not EO 475 and 478 are constitutional.
Under Section 24, Article VI of the Constitution, the enactment of appropriation, revenue
and tariff bills, like all other bills is, of course, within the province of the Legislative rather
than the Executive Department. It does not follow, however, that therefore Executive Orders
Nos. 475 and 478, assuming they may be characterized as revenue measures, are
prohibited to the President, that they must be enacted instead by the Congress of the
Philippines. Section 28(2) of Article VI of the Constitution provides as follows: (2) The
Congress may, by law, authorize the President to fix within specified limits, and subject to
such limitations and restrictions as it may impose, tariff rates, import and export quotas,
tonnage and wharfage dues, and other duties or imposts within the framework of the
national development program of the Government. There is thus explicit constitutional
permission to Congress to authorize the President subject to such limitations and
restrictions as [Congress] may impose to fix within specific limits tariff rates . . . and other
duties or imposts . . . .

Facts: The petitioner challenges RA 7042 on the ground that it defeats the constitutional
policy of developing a self-reliant and independent national economy effectively controlled
by Filipinos and the protection of Filipino enterprises against unfair foreign competition and
trade practices. He claims that the law abdicates all regulation of foreign enterprises in this
country and gives them unfair advantages over local investments which are practically
elbowed out in their own land with the complicity of their own government.

Specifically, he argues that under Section 5 of the said law a foreign investor may do
business in the Philippines or invest in a domestic enterprise up to 100% of its capital
without need of prior approval. All that it has to do is register with the Securities and
Exchange Commission or the Bureau of Trade Regulation and Consumer Protection in the
case of a single proprietorship. The said section makes certain that "the SEC or BTRCP, as
the case may be, shall not impose any limitations on the extent of foreign ownership in an
enterprise additional to those provided in this Act."
RA No. 7042 further abandons the regulation of foreign investments by doing away with important
requirements for doing business in the Philippines.
Finally, the petitioner claims that the transitory provisions of RA 7042, which allow practically
unlimited entry of foreign investments for three years, subject only to a supposed Transitory Foreign
Investment Negative List, not only completely deregulates foreign investments but would place
Filipino enterprises at a fatal disadvantage in their own country.
Issue: WON R.A. No. 7042 is constitutional
Decision: On the merits, we find that the constitutional challenge must be rejected for failure

to show that there is an indubitable ground for it, not to say even a necessity to resolve it.
The policy of the courts is to avoid ruling on constitutional questions and to presume that
the acts of the political departments are valid in the absence of a clear and unmistakable
showing to the contrary. The theory is that as the joint act of Congress and the President of
the Philippines, a law has been carefully studied and determined to be in accordance with
the fundamental law before it was finally enacted.
we hold that the cause of unconstitutionality has not been proved by the petitioner. On the contrary,
we are satisfied that the Act does not violate any of the constitutional provisions the petitioner has

The Court is not a political arena. His objections to the law are better heard by his
colleagues in the Congress of the Philippines, who have the power to rewrite it, if they so
please, in the fashion he suggests.
Petition dismissed.