DOJ Opinion No. 213, s. 1982

DOJ OPINION NO. 213 , s. 1982 October 12, 1982 The President National Power Corporation Quezon City Sir : This has reference to the question of whether or not Hitachi Cable Philippines, Inc. (HCPI) is qualified to bid for the supply of the cable requirements of the National Power Corporation (NPC) in the light of Section 1 of Republic Act No. 912, which reads: "Section 1. In construction or repair work undertaken by the Government, whether done directly or thru contract awards, Philippine made materials and products , whenever available, practicable and usable, and will serve the purpose as equally well as foreign made products or materials, shall be used in said construction or repair work, upon the proper certification of the availability, practicability, usability and durability of said materials or products by the Director of the Bureau of Public Works and/or his assistants." (Emphasis supplied) You state that HCPI is a domestic corporation registered with the Export Processing Zone Authority (EPZA) in Bataan and engaged in the manufacture of cables and electric wires; that it has requested NPC to allow it to participate in the bidding for the cables and electric wires needed by NPC; that the Philippine Electric Wire Manufacturing Association has opposed the aforesaid request on the ground that HCPI is disqualified from participating in subject bidding because its products are not made in the Philippines, in support of which stand it has cited the view of the Board of Investments that "products of EPZA registered firms are treated as imported merchandise" and therefore such "firm should not be considered local fabricators for purposes of government bidding"; and that in view of these conflicting positions, you have sought "guidance" from this Ministry. Subject to the extended discussion hereinafter, we opine that the products of HCPI are locally-manufactured materials and are, therefore, qualified for use by the government under Section 1 of RA 912, supra . The aforequoted provision of RA 912 states that " Philippine made products and materials " should be used, whenever practicable, available and usable, in construction or repair work undertaken by the Government. Thus, in the instant case the question boils down to whether or not the cables and electric wires manufactured by HCPI are "Philippine made products and materials". We believe that this question should be answered in the affirmative. It is an admitted fact that the subject products of HCPI are manufactured inside the Bataan Export Processing Zone; and it must be stressed that the area within said zone is part of Philippine territory. It must be for this reason that HCPI products are, we have been informed, marked "Made in the Philippines". Indeed, if we were to take the position that HCPI's products are not made in this country, an irregularity/absurdity would result in that we would not be able to pinpoint any country as the situs of production of such products. It is a familiar rule that a statutory interpretation which will result in absurdity should be avoided. The view that products of HCPI may not be deemed included in the category of "Philippine made products and materials" constitutes a ratio legis (spirit of the law) interpretation of the aforequoted statutory provision, as opposed to a verba legis (letter of the law) interpretation. It is likewise a familiar rule in statutory construction that when the law is free and clear of any ambiguity, as is the case with subject provision of RA 912, its letter must not be disregarded on the pretext of pursuing its spirit. (Op. Secretary of Justice dated January 27, 1969) LexLib Besides, such an interpretation would amount to restricting or qualifying the phrase in question ("Philippine made products and materials") as used in subject provision when no such restriction or qualification has been expressed or manifestly intended. It has been held that a statute should not be rewritten by enlarging or contracting it and that whatever temptation or statesmanship or policy-making might wisely suggest, interpolation or evisceration of its language should be avoided. (Demafiles vs. Commission on Election, 21 SCRA 1462 citing Justice Frankfurter) More importantly, it has been repeatedly declared by the courts that "when the law speaks in clear and categorical language, there is no room for interpretation or construction" for "a plain and unambiguous statute speaks for itself and any attempt to make it clearer is vain labor and tends only to obscurity". (Alcantara, Statutes, 1971 Ed., p. 19) Furthermore, our expressed view on this matter would be in furtherance of the legislative purpose for the enactment of RA 912, to wit: "to contribute to the realization of the economic program of the Government [which] is designed to promote the healthy growth of domestic industries so that the country will be economically self-sufficient." (Explanatory Note, H.B. No. 299 which was enacted as RA 912, Congressional Record, Vol. I, Part II, April 24-May 8, 1950, p. 2301) HCPI which as aforestated is a domestic corporation also operates inside the Philippines, as part of the local cable-manufacturing industry. To allow HCPI products to be utilized by the Government for its construction/repair works would be to foster competition in the cable manufacturing industry, thus affording the Government with a wider range of choice in the procurement of cables and wire products. These circumstances would foster the growth of the aforesaid industry and would undoubtedly contribute to the economic development of the nation. Incidentally, it is noted that the view that HCPI's products in the EPZA Zone are not qualified under subject provision of RA 912 is predicated mainly on the provision of Section 17(4) of P.D. 66 which is entitled "Tax Treatment of Merchandise in the Zone" and which provides that merchandise "sent from the zone [the EPZA Zone] to the customs territory shall . . . be subject to laws and regulations governing imported merchandise". The title of the section which uses the term "Tax Treatment" and the reference to "customs territory" in the provision itself are clear indications of the legislative intent to limit the provision to the tax treatment of merchandise coming from the said zone. Therefore, its scope of application should not be extended by interpretation to other aspects involving merchandise coming from the zone, such as the treatment of the goods produced within the Zone vis-a-vis other laws like the subject provision of RA 912. Moreover, had the legislative intention been to consider goods manufactured in the EPZA Zone as imported goods, it could easily have so stated in P.D. 66, considering that the law making authority may be presumed to have known that its silence on the matter would create problems in the implementation of laws giving preference to locally produced articles. llcd Finally, the EPZA Administrator has advanced the view that the fact that goods of EPZA registered firms are subject to Philippine customs and internal revenue regulations governing imported goods does not mean that they may not be deemed made in the Philippines. The settled rule is that interpretations by the office charged with implementing or enforcing the provisions of the statute, who in the case of P.D. 66 is the EPZA Administrator, should be given controlling weight. (Asturias Sugar Central, Inc. vs. Commissioner of Customs, 29 SCRA 617) Very truly yours, For the Minister of Justice: (SGD.) JESUS N. BORROMEO Deputy Minister