SEC Opinion 09-15
SEC Opinion 09-15
SEC Opinion 09-15
Department of Finance
Securities
17 June 2009
Sycip Salazar Hernandez &
Gatmaitan
SSHGLaw Center
105 Paseo de Roxas
Makati City
ATTENTION:
SUBJECT :
Gentlemen:
This refers to your letter-request for opinion dated 10 September 2008
with respect to the coverage of the nationality requirements in the rice and
corn industry.
In view thereof, you have provided the following set of facts:
The corporation involved is a domestic corporation organized and
existing under Philippine laws. It is engaged, among others, in the following
core activities relating to research, development, production, import,
distribution of rice, field corn seeds, and seed products:
a) They conduct research and development of hybrid field
corn seeds wherein they breed and conduct test and
field trials for hybrid field corn seeds.
b) They also conduct similar testing and field trials of rice
seeds samples from other countries for the purpose of
determining
adaptability for production in the
Philippines.
c) Once hybrid seeds of rice and field corn seeds are
selected, they are submitted for testing by the
government in order to get accreditation.
d) Once accreditation is obtained, the hybrid rice, field
corn seeds, and seeds are commercialized, launched,
Q http://www.sec.gov.ph
A
......
V
An Act Limiting the Right to Engage in the Rice and Corn Industry to Citizens of the
Philippines and for Other Purposes
2
Authorizing Aliens. as well as Associations, Corporations or Partnerships Owned in Whole
or in Part by Foreigners to Engage in the Rice and Corn In dustry, and for Other Pur poses
b.
From the foregoing, there can be no other conclusion but that, the
subject corporation's rice and field corn seeds production, for purposes of
trading the same, falls within the "rice and corn industry."
With regard to your second query, the Commission will decline to
respond thereto on the ground that such issue does not fall within its
jurisdiction. Highly instructive is the ruling of the Court of Appeals in the case
of Purina Philippines, Inc. vs. Hon. Waldo Q. Flores and National Food
Authority3, which we hereby quc>tein full:
"Section 5 of P.O. No. 194 provides furthermore, that 'in connection with
the foreign equity participation, at least 60% thereof shall be transferred
to Filipino citizens over a period to be established by the National Grains
Authority (now NFA) at the time of approval of its authority to engage in
the industry or phase out its operation within the same period.'
It is, thus, within the authority of public respondent NFA to require
Purina to submit a divestment plan of sixty (60%) percent of its foreign
equity participation as NFA's guide in establishing the divestment period
pursuant to the provisions of P.O. No. 194."
o
standing rule binding on the Commission in other cases, whether similar or
dissimilar circumstances. If upon investigation, it will be disclosed that the
facts relied upon are different, this opinion shall be considered as null and
void.
Very truly yours,
~
VERNETTE G. UMALI-PACO
General Counsel