Mr. Juanito T. Perez

September 18, 1992 Mr. Juanito T. Perez Acting Municipal Secretary Municipality of Medellin Province of Cebu S i r : This refers to your letter of August 5, 1992 which we received on September 15, 1992, furnishing the Commission of a copy of the Municipal Resolution No. 83-92 of the Sangguniang Bayan of Medellin, Cebu dated July 15, 1992 relative to its proposal to issue bonds, notes and other obligations. Please be advised that under Section 5 of the Revised Securities Act, securities issued by the Government or any of its political subdivisions are exempted from registration requirements. cdlex The Law provides: SECTION 5. Exempt securities . (a) Except as expressly provided, the requirement of registration under subsection (a) of Section four of this Act shall not apply to any of the following classes of securities: (1) Any security issued or guaranteed by the Government of the Philippines, or by any political subdivision or agency thereof or by any of its public instrumentalities, or by any person controlled or supervised by, and acting as an instrumentality of said Government, or any certificate of deposit for any of the foregoing. . . . (Emphasis supplied) Your attention, however, is invited to the attached news item stating that the Department of Justice has ruled that only city and provincial governments, and not municipalities are authorized to issue bonds as provided for under Section 6 of P.D. No. 752. In view thereof, we advise you to seek clarification on the matter from the Department of Justice. Very truly yours, (SGD.) ROSARIO N. LOPEZ Chairman