DOJ Opinion No. 046, s. 1982

DOJ OPINION NO. 046 , s. 1982 March 30, 1982 Lloyds Bank International Limited, Fuji International Finance Limited, Allied Banking Corporation Ayala International Finance Limited Credit Lyonnais Hong Kong (Finance) Limited London & Continental Bankers Limited LTCB International Limited Philippine Commercial And Industrial Bank PNB International Finance Limited Standard Chartered Merchant Bank Limited Tokai Kyowa Morgan Greenfell Limited ("The Manages") c/o Lloyds Bank International Limited, 40-66 Queen Victoria Street, London EC4P 4EL and Lloyds Bank Limited, 71, Lombard Street, London EC3P 3BS. ("The Trustee") Gentlemen : DEVELOPMENT BANK OF THE PHILIPPINES U.S. $30,000,000 Guaranteed Floating Rate Notes due 1990 Guarantee by THE REPUBLIC OF THE PHILIPPINES As the legal adviser in the Republic of the Philippines for the Republic of the Philippines ("the Guarantor") in connection with the issue by Development Bank of the Philippines ("the Issuer") of U.S. $30,000,000 Guaranteed Floating Rate Notes due 1990 ("the Notes") guaranteed by the Guarantor, I have examined (inter alia) copies of the following documents: (a) Preliminary Offering Circular, dated March 5, 1982 (b) Final Offering Circular ("the Offering Circular"), dated March 18, 1982. (c) Subscription Agreement, dated March 18, 1982 ("the Subscription Agreement"), between the Issuer, the Guarantor and the Managers. (d) Trust Deed, dated April 1, 1982 ("the Trust Deed"), between the Issuer, the Guarantor and the Trustee, as trustee. (e) Paying Agency Agreement, dated April 1, 1982 ("the Paying Agency Agreement"), between the Issuer, the Guarantor, the Fuji Bank and Trust Company as Principal Paying Agent, and the other Paying Agents referred to in the Offering Circular. (f) Purchase Agency Agreement, dated March 18, 1982 ("the Purchase Agency Agreement"), between the Issuer, the Guarantor and Lloyds Bank International Limited as agent bank. (g) Agent Bank Agreement, dated March 18, 1982 ("the Agent Bank Agreement"), between the Issuer, the Guarantor and Lloyds Bank International Limited as agent bank. cdlex (h) Form of the Temporary Global Note ("the Temporary Global Note") as set out in the First Schedule to the Trust Deed. (i) Forms of the definitive Notes and the coupons appertaining thereto ('the coupons") as set out in the Second Schedule to the Trust Deed. (j) Form of the guarantee ("the Guarantee") given by the Guarantor set forth on the face of the Temporary Global Note and the definitive Notes. (k) Full Powers, dated March 8, 1982 (the "Full Powers") executed by the President of the Philippines. (l) Letter, dated March 11, 1982, from the Minister of Finance of the Republic of the Philippines to the President of the Republic of the Philippines recommending the approval of the issue of the Notes by the Issuer and the notation thereon of the President dated March 17, 1982, in which he "approved" the said issue. (m) Letter, dated March 15, 1982, from the Central Bank of the Philippines to the Issuer setting out the terms of the "approval in principle" by the Monetary Board of the transactions contemplated under the Agreements. The Subscription Agreement, the Trust Deed, the Paying Agent Agreement, the Purchase Agency Agreement, the Agent Bank Agreement and the Guarantee are together referred to in this opinion as "the Agreements". References herein to "the Specified Transactions" are to: (i) the guarantee of the Notes by the Guarantor and the performance of its obligations under such guarantee; (ii) the execution and delivery by the Guarantor of the Agreements and the performance by the Guarantor of its obligations thereunder; and (iii) the taking of all other action and the doing of all other things provided for, in, or contemplated by, the Agreements or otherwise necessary or desirable in connection with the issue of the Notes. In giving the opinion state herein, I have made the following assumptions: (a) that all documents submitted to me as copy or specimen documents conform to the originals thereof: (b) that all documents have been validly authorized, executed and delivered by all of the parties thereto (other than the Guarantor); and (c) that the signatures on the originals of all documents submitted to me are genuine. I express no opinion as to any law other than the laws of the Republic of the Philippines and I have assumed that there is nothing in any other law that affects my opinion stated herein. In particular I have made no independent investigation of the laws of England as a basis for the opinion stated herein and do not express or imply any opinion thereon. LexLib Based upon and subject to the foregoing and having regard to such legal considerations as I deem relevant, I am of the opinion that: 1. The whole of the capital stock of the issuer is owned by the Guarantor. 2. The Guarantor has full power and authority to carry out the Specified Transactions. 3. All necessary action has been taken by the Guarantor to authorities the Specified Transactions. 4. The carrying out of the Specified Transactions does not and will not conflict with or result in a breach of any of the terms or provisions of the Constitution of the Guarantor or any law, rule or regulation applicable to the Guarantor in the Republic of the Philippines or constitute a default under any contract, agreement or other instrument relating to External Indebtedness (as defined in the terms and conditions of the Notes) applicable to the Guarantor or any order or decree of any governmental authority or any other official body in the Republic of the Philippines. 5. The Full Powers has been duly executed by the President of the Republic of the Philippines and constitutes each of the persons therein named as the duly appointed representative of the Guarantor with the powers and authorities therein specified. 6. The Agreements, having been executed on behalf of the Guarantor by its representative appointed as aforesaid (such execution being, in the case of the Guarantee expressed on the face of the definitive Notes, by facsimile signature), have each been duly executed by the Guarantor and constitutes the legal, valid and binding obligations of the Guarantor enforceable in accordance with their respective terms. 7. The Guarantee of the Notes as expressed on the face of the Notes contained in the Trust Deed constitutes the legal, valid and binding obligation of the Guarantor enforceable in accordance with its terms ranking pari passu with all other unsecured External Indebtedness (other than subordinated indebtedness) of the Guarantor. In this regard I confirm that the provisions of the Civil Code of the Philippines, which confer a preference on obligations which appear in public instruments, do not apply to borrowings of, or guarantees by, the Republic. 8. All necessary authorizations, consents and approvals required from any government authorities or other official bodies in the Republic of the Philippines in connection with the Specified Transactions have been obtained and are in full force and effect. 9. No stamp duties or other taxes are payable under the laws of the Republic of the Philippines by reason of any of the Specified Transactions. 10. Other than the registration with the Central Bank of the Philippines of the Agreements, there are no registration, filing or other formalities required in the Republic of the Philippines in connection with Specified Transactions. 11. All payments of principal and interest by the Guarantor under the Agreements, in case of default of the Issueer, will be made without deduction or withholding for or on account of any present or future taxes levied by or on behalf of the Republic of the Philippines or any authority thereof or therein having power to tax, unless deduction or withholding is compelled by law, in which event the Guarantor is not legally prohibited from paying such additional amounts by way of principal or interest as will result in the payment to the Note holders or Couponholders of the amount which would otherwise have been receivable in respect of principal and interest. 12. The courts of the Republic of the Philippines will observe and give effect to the choice of English law as the governing law of the Agreements and the Notes except that (a) Philippines laws and administrative regulations bearing upon the capacity of the Guarantor to enter into contracts, and (b) Philippines laws and administrative regulations requiring Philippine Governmental approvals, authorizations and consents for acts or contracts performance of which in whole or in part takes place within the Republic of the Philippines, will be applied by the courts of the Republic of the Philippines. 13. The courts of the Republic of the Philippine will recognize as a valid judgment and will enforce any final judgment for a sum of money obtained in the courts of England or the State of New York or the United States Federal courts in the State of New York against the Guarantor in an action instituted by service of process on the authorized agent of the Guarantor in the manner contemplated by any of the Agreements and will give effect thereto provided that (a) such judgment was not obtained by collusion or fraud, (b) the relevant court had jurisdiction over the case, and (c) such judgment was not tainted by want of notice to the party of the foreign proceeding or a clear mistake of law or fact. LexLib 14. The Guarantor is generally entitled in the Philippines to immunity from legal proceedings or other legal process in the Philippines but it has validly waived such immunity in respect of its obligations under the Agreements. The waiver by the Guarantor with respect to itself or its assets of any such immunity to which it may be entitled outside of the Republic of the Philippines is valid and binding upon the Guarantor. 15. No litigation or arbitration is presently pending or, to the best of my knowledge, threatened against the Guarantor or any of its departments or agencies which is material in the context of the issue of the Notes. The opinions expressed herein as to the enforceability of agreements and obligations or the giving effect to judgments are subject to all applicable laws effective the enforcement of credits' rights generally. cdll I express no opinion with respect to the enforceability in the Republic of the Philippines of Clause 24 of the Trust Deed to the extent that it permits a second suit, after recovery of a judgment in the Judgment Currency (as defined in the Trust Deed), for the recovery of the dollar deficiency. I would point out, however, that a court of the Republic of the Philippines may and is authorized to render judgment in dollars, and that the obligation of the Guarantor to pay in dollars is valid, binding and enforceable under the law of the Republic of the Philippines. This opinion, though addressed to you, may be relied upon by your legal advisers. Very truly yours, (SGD.) RICARDO C. PUNO Minister of Justice