Republic ofthe Philippines Department of Transportation and Communications LAND TRANSPORTATION FRANCHISING & REGULATORY BOARD East Avenue, Quezon City MEMORANDUM CIRCULAR NUMBER 2016 - 0/2, SUBJECT: PROHIBITION ON THE ACCEPTANCE OF APPLICATIONS FOR SALE AND TRANSFER WHETHER VOLUNTARY OR INVOLUNTARY OF CPC AND REPEAL OF MEMORANDUM CIRCULAR NO. 96-015 WHEREAS, “the right of the state to regulate public utilities is founded upon the police power, and statutes for the control and regulation of utilities are a legitimate exercise, thereof, for the protection of the public as well as of the utilities themselves. Sueh statutes are, therefore, not unconstitutional, either as impairing the obligation of contracts, taking property without due process, or denying the equal protection of the law, inasmuch as the question whether or not private property shall be devoted to a public use and the consequent burdens assumed is ordinarily for the owner to decide; and if he voluntarily places his property in public service he cannot complain that it becomes subject to the regulatory powers of the state. This is more so in the light of authorities which hold that a certificate of public convenience (CPC) constitutes neither a franchise nor a contract, confers no property right, and is a mere license or privilege (Pangasinan Transportation Company, Inc. v. Public Service Commission, 70 Phil. 221 [1940))" WHEREAS, “to this day, the accepted view of at least in so far as the state is concerned is that ‘a CPC constitutes neither a franchise nor a contract, confers nor property rights and is a mere license or privilege.’ The holder of such certificate does not acquire a property right over the route covered thereby. Nor does it confer upon the holder any proprietary right, interests or franchises in a public highway (Baldomero S. Luque, et al. v. Antonio J. Villegas, et al., No. 22545, November 25, 1969, 30 SCRA 408);” WHEREAS, “it need only to be stated that certificates of public convenience confer no property right and are mere licenses or privileges. As such, these must yield to legislation safeguarding the interest of the people (MMDA, er al. Vs. Viron Trans. Co., Inc., G.R. No. 170657 promulgated on August 15, 2007); WHEREAS, the Board and the land transportation industry are now confronted with the problem of commercialization of CPC or “buy and sell operators” who have abused and hijacked the franchising process by traflicking in franchises/CPC’s at huge profit instead of operating the same, These are usually transport operators who apply for franchises/CPC’s with the Board on various services and lines that they proposed to operate on the service applied for should the application be granted. But after approval, they instead sold the same for a hefty profit to interested vehicle owners who have no franchise/CPC. This has been a lucrative business which mocks the very purpose why franchises/CPC’s are applied for and granted; WHEREAS, it should bear emphasis that the consideration that is given to any person to secure a CPC from the State is to perform a public duty. The primary objective of all grants of CPC is to benefit the public; the rights or interests of the grantees are just secondary;WHEREAS, the above jurisprudence and legal principles need to be enforced in order to promptly address the problem confronted by the Board and to stop the commercialization of franchises. NOW THEREFORE, this Board hereby PROHIBITS the acceptance of Application for Sale and Transfer or any form of conveyances of a Certificate of Public Convenience including involuntary sheriff's sale by way of levy or execution of judgment or as a consequence foreclosure proceedings. In the event that public land transport operators would plan to discontinue or cease to operate as public land transportation providers, their CPC’s should be surrendered and reverted back to the state through this Board All vendees of CPC’s are directed to file the necessary application for sale and transfer Prior to the effectivity of Memorandum Circular; otherwise, the same shall not anymore be accepted, This Circular repeals Memorandum Circular No. 96-015. Likewise, all other issuances or parts thereof inconsistent herewith are hereby modified, amended, or superseded accordingly. This Memorandum Circular shall take effect fifteen (15) days following its publication in a newspaper of general circulation and the filing of three (3) copies hereof with the UP Law Center pursuant to Presidential Memorandum Circular No. 11, dated 09 October 1992. SO ORDERED. 28 JUL 2016 Quezon City, Metro Manila, Tae Ae a ATTY. MARTIN wlonyona C)) 3 Chairman ee ey ENGR. “QURPUS ATTY. ANTONIO ENRILE-IN’ R. Board Member Board Member Attested Atty, ROBERT D. PEIG, CESO V Officer-in-Charge Office of the Executive DirectorSS The Poppe 57 BUSINESS ©) Ree ofthe Plies FTrpaon nd Comenius LAND TRANSPORTATION FRANCHISING & REGULATORY BOARD staan. cura Gy ‘MEMORANDUM CIRCULAR NUMBER2HI6 610 SUBJECT: PROMIGITION ON THE ACCEPTANCE. OF APPLICATIONS POR SALE AND TRANSFER WHETHER VOLUNTARY OR INVOLUNTARY OF CPC AND REPEAL OF MEMORANDUM CIRCULAR NO. 96415 WHEREAS, ect te ste wea pei te is ne a te oe poe ns cnt epson of tier eal exe, ee Ee psinof epic nel fetes Sah ese, tmnt etx m inpcng te ie of mc, king ppt wa oe es ot deja i gel pci fe mama i eon we ok ice opt al be dvd ue we al he sou hes ee s {dy eon x heey pe hippy in pi nie rt sot ies se he ely pve te. Greta tes wish ll ht een of pe ois (PC cos er face oa cet, prope de es ci Pagan Troupin Compa, bx. 0 ole Soe Comicon 1 Pe Zi ase ‘WHEREAS, otis cepted view oft ka ino ish seis comera ists CPC conte nite ce nox comm confs at propery igh aa rue es oc vsge The lero sc ete does at segue «pope ih et the woe coved toy. No esi ofr pn hehe any propia igh, les fics ina pubic highway (Blom 8. La, ea. Axo. Yea, a a DISS Naan 15,1963, 30SCRA 18 ‘WHEREAS, “sed oly oes at etfs of pe conve ener 29 oper igh and ae mere Giese or pve. As sch tee mus yield lation faleuarding be st ofthe ple (MDA, eo. Pi: Von Trans: Coy In, GR No. 1457 promalgied a gut 13,207; ‘WHEREAS, Bord nd hn neato inary are nw contd wih he poole of exmmeikztion of CPC or “buy and sell epermn” win hve ska ed Ijpcked th foshiing process by sucking in SetveCPC's ot igepot ised of ‘jertng he me. The ce sly cpt oars who pl fo aenevCPC' wis ‘he Bod on ris sevis an ine hat ty rps to operat othe erie api for shold spices be ame. Butair pov insted sol te same foray rit to ieee wile coer vio lve mo ncislCPC. Tis as ben Ife bsies ‘whichever pps wy aniveCPCs re pl for an ranted 8-6 [LASSIFindarp saunoay, Jury 90, 2018 WHEREAS isha bear emp tt consents to any pen serre PC fr ke Sue so patna pubic uty. The pry oboe ofl ans of ‘CEC tet pubis ih oriners ofthe pes ae ju een, WHEREAS, te atve rsp: nda pipes med oe foe in era roy ase pu: cone ts Boe alo sop eamneikiton of fendi [NOW THEREFORE, tis Bout herby PROBIBIT the scxce of Applicainn (or Sle ad Tester or my fh of coaveaces of a Cerf of Pie Camere ining ilar) seal byway ofr exe of get xs consequence ‘iene otedigs. Tithe event tt pul an tanger opts woud plan sci ces 0 oper spb dl maga vies, thr CPC's sl be sureated ad ever ‘kin te satin is Boa. Al ads of Cs Gt the oes eplicon rele and rae peor de efciiy of Merona Cia; otherwise, the snes mt aamr be scx, ‘Tcl pes Mercredi Cla No, 6015, Likes lo isco ir tenance brie ey died amd ripest wry, ‘Ws Mena Cia shal ue ef fie (15) us aloving is pbs ‘emeaspaer of gee ctalon ed ing of thee (5) ops how wih te UP Law Conerpasun Priel Marat Cal No.1, ied 9 Ose 192. ‘$0 ORDERED. Queoon City, eto Manila, 2h aL 6 ecole © elt a went flee ae ae ‘ty. ROBERT D, PRIG, CESO V Office Char fice ofthe Esa Deer 8, 302016