Request for Opinion Regarding the Validity of LOI No. 1479 Re: Ban on Importation of Airline Tickets

DOJ OPINION NO. 017 , s. 2012 March 27, 2012 Executive Director Carmelo L. Arcilla Civil Aeronautics Board Old MIA Road, Pasay City Dear Executive Director Arcilla : This refers to your request for clarification on two issues: 1) Was Letter of Instructions (LOI) 1479, issued by then President Marcos, an exercise of his extraordinary power of legislation as contemplated in the 1973 Constitution, as amended by Section 6 of the 1976 Amendments to the Constitution, such that a repeal thereof would require Congressional action?; and 2) Has LOI 1479, by reason of the fact the rationale for its issuance has ceased to exist, automatically ceased to be operative? AcHSEa The request, it appears, stemmed from the petitions by Philippine Airlines and several airline companies, both international and domestic, for the lifting of LOI 1479, otherwise known as the "Ban on Importation of Airline Ticket," which specifically provides that all airline tickets outside the Philippines for international air transportation of passengers originating in the Philippines shall not be valid for such transportation. You state that the purposes for which said LOI was issued are outlined in its whereas clauses, to wit: 1. Protection of the Government's travel tax revenue; 2. Protection of the economic viability of local travel agents; and 3. Prevention of the development of a black market in foreign exchange and circumvention of foreign exchange regulations. You also say that the airline companies, in their petition to lift LOI 1479, cited among others, the following reasons: 1. The Bangko Sentral ng Pilipinas (BSP) interposed no objection thereto, and stated that: "Considering that foreign exchange transactions have been liberalized under existing BSP rules specifically, Sections 1 and 20 of Central Bank Circular No. 1389 dated 13 April 1993, as amended, which allow foreign exchange receipts of residents to "be sold outside the banking system" or "retained, or deposited in foreign currency accounts, whether in the Philippines or abroad," the reason is no longer applicable or appropriate." 2. As to the tax objective, PAL, in particular, believes that a lifting of the ban will not lead to the evasion of travel tax by Filipino passengers for the reason that: 1) Check-in staffs of international airlines operating in the Philippines deny check-in to passengers who do not pay travel tax; and 2) the Philippine Tourism Authority (PTA) maintains collection booths in all international airports for purposes of collecting travel tax. 3. As for the protection of the economic viability of local travel agents, it should be noted that there are no differences in ticket prices for flights booked on a particular sector, at a particular class of service and booking class code regardless of where the ticket is purchased. As a result, Philippine travel agents do not suffer any price disadvantages vis--vis their foreign counterparts. 4. With the lifting of the ban, Filipinos or employers abroad would be in a position to quickly and easily purchase tickets for Filipinos and their relatives in the Philippines without having to go through the cumbersome PTA procedures. HAICET Relative thereto, please be informed that a similar request for opinion on the effectivity and validity of an LOI, particularly, Letter of Instruction No. 1264 banning the importation, manufacture, distribution, sale and display of certain types of toy firearms and explosives and on the manner of repealing an LOI, was brought before this Department by the Office of then Congressman Rufino Biazon. The said request for opinion was answered in DOJ Opinion (No. 063, s. 2006) dated September 11, 2006, where we held that: ". . . (T)he Supreme Court, in the case Philippine Association of Service Exporters, Inc. vs. Torres , stated: Letters of Instructions are the orders by the President to specific government officials directing or authorizing the doing of certain things, or laying guidelines to be complied with for the effective implementation of a law. Examples are Letters of Instructions No. 2 ordering the Secretary of National Defense to take over the management, control and operation of public utilities, and No. 65 directing compliance with certain guidelines for the full implementation of the tax amnesty on previously untaxed income under Presidential Decree No. 23, as amended. "They have also been issued to announce and order designations to certain positions ( e.g. , L.I. No. 87) and to announce the approval and effectivity of programs, plans ( e.g. , L.I. No. 64, 66), or recommendations ( e.g. , L.I. No. 91 approving NEDA recommendation for the salary structure of the staffing pattern of the NEDA) requiring the approval of the President . . . . They have also been issued to repeal modify or amend laws ( e.g. , L.I. No. 1054 which amended Sec. 268 of the National Internal Revenue Code by deleting bowling alleys as among those subject to tax). "In the case of Garcia-Padilla vs. Enrile , the same Court, resolving the issue of whether a presidential issuance under the 1973 Constitution may be considered a law, also clarified: "To form part of the law of the land, the decree, order or LOI must be issued by the President in the exercise of his extraordinary power of legislation as contemplated in Section 6 of the 1976 Amendments to the Constitution, whenever in his judgment there exists a grave emergency or a threat or imminence thereof, or whenever the interim Batasan Pambansa or the regular National Assembly fails or is unable to act adequately on any matter for any reason that in his judgment requires immediate action . . . . Verily, not all LOI issued by the President should be dignified into forming part of the law of the land. "Moreover, in the earlier cited Philippine Association of Service Exporters, Inc. case, the Court even reiterated that "(u)nlike Presidential Decrees which by usage have gained acceptance as laws promulgated by the President, Letters of Instruction are presumed to be mere administrative issuances except when the conditions set out in Garcia-Padilla v. Enrile exist." And, in the more recent consolidated case of Polland Industrial Limited vs. National Development Company , the Court stressed "Only when issued under any of the two circumstances will a decree, order or letter be qualified as having the force and effect of law. The decree or instruction should have been issued either when there existed a grave emergency or threat or imminence or when the Legislature failed or was unable to act adequately on the matter. The qualification that there exists a grave emergency or threat or imminence thereof must be interpreted to refer to the prevailing peace and order conditions because the particular purpose the President was authorized to assume legislative powers was to address the deteriorating peace and order situation during the martial law period. "Under the 1987 Constitution, the status of said LOI, among others, is clear, thus: TAacCE SEC. 3. All existing laws, decrees, executive orders, proclamations, letters of instructions, and other executive issuances not inconsistent with this Constitution shall remain operative until amended, repealed, or revoked. . . . Finally, on the issue of repeal of a presidential issuance, DOJ Opinion No. 47, s. 2004, may be relevant to your query: "The question of whether a particular law has been repealed or not by a subsequent law is a question of legislative intent. The lawmaker may expressly repeal a law by incorporating therein a repealing provision which expressly and specifically cites the particular law or laws, portions thereof, that are intended to be repealed. However, where the legislative intent is not to work a repeal of specific laws, it provides for a general repealing provision the effect of which is to repeal by implication all inconsistent provisions of extant laws. It is said that an implied repeal takes place when a new law contains some provisions which are contrary to, but do not expressly repeal, those of a former law ( School District No. 45 v. Bd. of County of Comira , 141 Kan. 108). "Implied repeals or repeals by implication are not favored. Only in cases where the laws or provisions involved are found to be irreconcilably inconsistent with each other may a repeal of the earlier law by a later enactment be presumed. Otherwise, it is the task of the implementers of the law to harmonize the conflicting laws or provisions so as to give effect to both, because laws are presumed to have been passed with full knowledge on the part of the lawmaker of all existing laws on the subject ( U.S. vs. Palacios , 33 Phil. 208). "However, it has been held that an implied repeal may also result even if the two laws are not repugnant whenever a statute (old law) is revised and the revised statute (new law) purports to cover the entire subject matter of the old law and there is a clear legislative intent to substitute the new law for the old law (Crawford, Statutory Construction, p. 673; Joaquin v. Navarro , 81 Phil. 373). In such a case, provisions in the old law which were not reenacted in the new law will be deemed repealed (Op., Sec. of Justice, No. 78, s. 1988, citing Agpalo, Statutory Construction, p. 239)." Applying the foregoing in the present request for opinion, this Department holds that the LOI 1479 is still a valid presidential issuance since there is no law or other statutes which expressly or impliedly repeal its pertinent provisions. Nonetheless, LOI 1479 must be regarded as a mere administrative issuance by the President there being no indication that it was issued under the requirements enunciated in the earlier mentioned Garcia-Padilla vs. Enrile case. Please be guided accordingly. SCaDAE Very truly yours, (SGD.) LEILA M. DE LIMA Secretary