Philippine Association of Service Exporters. Inc.

July 27, 1990 Philippine Association of Service Exporters, Inc. c/o Atty. Francisco S. de Guzman 1690 Jorge Bocobo Cor. Gen. Miguel Malvar Sts. Malate, Manila Gentlemen : This refers to your letter dated July 2, 1990 requesting opinion on the following query: llcd "May an alien act or serve as an Officer of a corporation, partnership or single proprietorship engaged in the recruitment and placement business in an executive or managerial capacity, such as President, Vice-President, Chairman of the Board, General Manager or Manager Director, etc.?" The Commission, on several occasions, has ruled that in firms engaged in wholly or partially nationalized activities , aliens are banned from being appointed to management positions such as president, vice-president, treasurer, auditor, etc. of said companies pursuant to the ruling of the Department of Justice, although they can be elected directors in proportion to their allowable participation or share in the capital of such activities in accordance with Commonwealth Act No. 108, as amended by PD 715, otherwise known as the Anti-Dummy Law. (SEC Opinions dated June 14, 1982 * , July 1, 1983; May 15, 1985; May 28, 1985; April 26, 1989) The law provides thus: "SECTION 2.A. Any person, corporation or association which, having in its name or under its control, a right, franchise, privilege, property or business, the exercise or enjoyment of which is expressly reserved by the Constitution or the laws to citizens of the Philippines or of any other specific country, or to corporations or associations at least sixty per centum of the capital of which is owned by such citizens ,...permits or allows any person, not possessing the qualifications required by the Constitution, or existing laws ..., to intervene in the management, operations, administration or control thereof, whether as an officer, employee or laborer therein with or without remuneration except technical personnel whose employment may be specifically authorized by the Secretary of Justice ...shall be punished by imprisonment for not less than five nor more than fifteen years ...:and provided, finally, that the election of aliens as members of the Board of Directors or governing body of corporations or associations engaging in partially nationalized activities shall be allowed in proportion to their allowable participation or share in the capital of such entities ." (Emphasis supplied) Under the Labor Code, "only Filipino citizens or corporations, partnerships or entities at least seventy five per cent (75%) of the authorized and voting capital stock of which is owned and controlled by Filipino citizens shall be permitted to participate in the recruitment and placement of workers, locally or overseas". Accordingly, a recruitment or placement business is considered a partially nationalized business activity. llcd Your query is therefore answered in the negative. Very truly yours, (SGD.) RODOLFO L. SAMARISTA Associate Commissioner * Copied verbatim from documents obtained directly from the Securities and Exchange Commission .