DOJ Opinion No. 271, s. 1982

DOJ OPINION NO. 271 , s. 1982 December 3, 1982 To: The banking and financial institutions parties to the Loan Agreement dated as of August 27, 1982 (the "Agreement") among National Power Corporation (as Borrower), The Government of the Republic of the Philippines (as Guarantor), the banking and financial institutions named therein (as Lenders), the Mitsubishi Bank, Limited (as Manager and Agent) and The Mitsubishi Bank Limited as such Agent Gentlemen : As the Minister of Justice of the Republic of the Philippines (the "Philippines"), I have been requested to render on opinion to you in connection with Agreement, pursuant to which agreement, and subject to the terms and conditions set forth therein, the Lenders severally agree to make loans to the Borrower, to be unconditionally guaranteed by the Guarantor, up to the aggregate principal amount of Three Billion Five Hundred Million Japanese Yen (3,500,000,000). In connection therewith, I have examined the constitution, laws, including the Charter of the Borrower, decrees, judicial decisions and regulations of the Philippines bearing upon the Agreement and the Notes to be issued pursuant thereto, particularly those as affect the issuance of the guarantee by the Government of the Philippines, and such other agreements, instruments and documents, and such other matter as I have considered necessary or desirable as a basis for the opinion hereinafter expressed, including, without limitation, the following documents; (1) An executed copy of the Agreement. (2) Full Powers dated July 29, 1982 issued by the President of the Philippines empowering Minister of Finance Cesar E.A. Virata, "or, in his absence", Deputy Minister of Finance, Minister Victor C. Macalincag, to sign and execute the guarantee in behalf of the Government of the Philippines. (3) The letters of the Central Bank of the Philippines both dated October 11, 1982 authorizing the borrowing, to be guaranteed by the Government of the Philippines, contemplated under the Agreement, 4. The acceptance by the Consul General of the Philippines in Tokyo, Japan of his appointment pursuant to the Agreement as the Agent of the Guarantor for the purpose of receiving service of process on the Guarantor. On the basis of the foregoing, I am of the opinion that: 1. Under the Charter of the Borrower the Guarantor has full power, authority and legal right to give the Guarantee provided for in the Agreement, to execute and deliver the Agreement, to endorse on the Notes the Guarantee referred to in Section 2.6 of the Agreement, and to perform and observe the terms and provisions of the Agreement and the Guarantee. 2. All acts, conditions and things required to be done and performed and to have happened prior to the execution and delivery of the Agreement (insofar as the Guarantee is concerned) and the Guarantee (including the Guarantee to be endorsed on the Notes; hereinafter the same), and to constitute the same the valid obligations of the Guarantor in accordance with the terms thereof have been done, performed and have happened in due and strict compliance with all applicable laws of the Philippines. 3. All registrations, consents, licenses, and approvals of all governmental agencies, ministries and commissions which are necessary for the execution and delivery by the Guarantor of the Agreement and the Guarantee, or for the validity or enforceability thereof, have been duly obtained. 4. The execution, delivery and performance by the Guarantor of the Agreement and the Guarantee are duly authorized by law and will not violate any provision of law, statute, decree, rule or regulation of the Government of the Philippines, or result in the breach of, or constitute a default undersea, any treaty or other international agreement or instrument relating to Foreign Debt to which the Guarantor is a party, or by which the Guarantor or any of its properties may be bound or affected, and the Agreement does, and the Guarantee when duly executed will, constitute the legal, valid and binding obligations of the Guarantor, enforceable in accordance with the terms and provisions thereof. 5. The obligations of the Guarantor under the Agreement including the obligations under the Guarantee provided for in Section 8.2 (a) of the Agreement and the obligations of the Guarantor under the Guarantee to be endorsed on the Notes upon execution and delivery thereof will be direct, unconditional and irrevocable obligations carrying the full faith and credit of the Government of the Philippines and such obligations shall rank pari passu in all respects (whether in respect of priority of lien, pledge, charge or other security or otherwise) with all other Foreign Debt of the Government of the Philippines, whether now or hereafter outstanding except as permitted under Section 8.2 (d) of the Agreement. LexLib 6. Any action relating to the Agreement and the Guarantee may be instituted against the Guarantor in the Tokyo District Court as provided therein or any court in the Philippines of competent jurisdiction by virtue of the (i) waiver by the Guarantor in Section 7.2 (f) of the Agreement of sovereign immunity to which it might otherwise be entitled in any such action, and (ii) consent by the Guarantor to jurisdiction in Section 8.2 (b) of the Agreement which waiver and consent have been authorized by the President of the Philippines under and are in full compliance with Presidential Decree No. 1807 and are valid and binding under the laws of the Philippines, enforceable in accordance with their terms. 7. To the best of my knowledge and belief all fees or taxes, if any, required to be paid in connection with the validity or enforceability of the Agreement and the Guarantee have been paid. 8. To the best of my knowledge and belief no event has occurred or is continuing which constitutes or which with the giving of notice or lapse of time or both would constitute an Event of Default under the Agreement. 9. No provision of law, decree or administrative regulations prohibits, in the event of default on the part of the Borrower (a) the payment by the Guarantor of all taxes and other charges, levied or imposed by the Government of the Philippines or any ministry, agency, political or administrative subdivision or taxing authority thereof or therein, on the Lenders and/or the Agent in respect of payments to be made by the Guarantor under the Agreement and Guarantee, and (b) the remittance in full of all payments required from the Guarantor under the Agreement and the Guarantee subject to the provisions of Section 74 of the Republic Act No. 265, as amended. 10. The choice of the law of Japan to govern the Agreement and the Guarantee and the right and obligations of the parties thereunder is under the law of the Philippines valid choice of law and will be honored by the courts of the Philippines. 11. The Guarantor has validly submitted to the jurisdiction of the Tokyo District Court and a judgment of such court rendered in an action to enforce the obligations of the Guarantor under the Agreement and the Guarantee or to claim from the Guarantor any sum due as a result of default thereunder or for any other reason shall be enforceable in the Philippines upon prior approval of any court or legal authority which may be required in accordance with the law of the Philippines. 12. The Guarantor has duly and validly designated the Embassy of the Philippines in Tokyo, Japan, as the address for the purpose of accepting service of process in Japan in connection with any action instituted in Japan relating to the Agreement and the Guarantee and has duly and validly appointed the Consul General of the Philippines in Tokyo, Japan as the authorized agent to accept such service of process. Very truly yours, (SGD.) RICARDO C. PUNO Minister of Justice