DOE-DOJ Resolution No. 01-08 Amending Resolution No. 98-01 (Rules and Regulations of the DOE-DOJ Task Force)

July 14, 2008

DOE-DOJ RESOLUTION NO. 01-08

AMENDING RESOLUTION NO. 98-01 OTHERWISE KNOWN AS THE RULES AND REGULATIONS OF THE DOE-DOJ TASK FORCE

Pursuant to paragraph (d) of Section 14 of Republic Act No. 8479, "THE DOWNSTREAM OIL INDUSTRY DEREGULATION ACT OF 1998", the Department of Energy-Department of Justice Task Force resolves, as it is hereby resolved to adopt the following amendments:

SECTION 1. Section 4 of Resolution No. 98-01 is hereby amended to read as follows:

"SEC. 4. Action on the Report. — The report if found sufficient in form and content, shall be forwarded by the Task Force to the panel of State Prosecutors duly designated by the Secretary of Justice. Otherwise, the report shall be dismissed by the Task Force."

SECTION 2. Section 5 of Resolution No. 98-01 is hereby deleted.

SECTION 3. Section 6 of the Resolution is renumbered to Section 5 and is hereby amended to read as follows:

"SEC. 5. Task Force Investigation. — In the process of conducting a preliminary investigation of the report, the Task Force, through the State Prosecutor, shall issue a subpoena against the respondent. Within ten (10) days from receipt of subpoena, the respondent may submit counter-affidavits and other supporting documents and shall be allowed to examine all the evidence considered in the findings of the Task Force.

If the Respondent cannot be subpoenaed or if subpoenaed, does not submit counter-affidavits within ten (10) day period, the Task Force shall resolve the matter on the basis of the records and evidence on hand. The Task Force may, however, set a hearing where it may propound clarificatory questions to the parties or their witnesses. ISCaTE

The following parameters (the "Parameters") shall guide the Task Force in determining whether or not there has been an "unreasonable rise" in the price or prices of petroleum products;

1. MOVEMENTS IN WORLD OIL PRICES. — When an increase in price is inconsistent with the increase or increases in the price of:

(a) Crude Oil as registered in the Singapore market within a particular period as determined by the DOE as regards refiners of crude oil; or

(b) Petroleum Products as registered in the Singapore market within a particular period as determined by the DOE as regards importers of petroleum products;

2. FOREIGN EXCHANGE FLUCTUATIONS. — When an increase in price is inconsistent with foreign currency adjustments resulting from fluctuations or changes in the Philippine Peso-US Dollar rates;

3. VIOLATION OF REPORTORIAL REQUIREMENTS. — When an oil company fails to report an increase in price pursuant to the pertinent department circular or rules/regulations issued by the DOE Secretary pursuant to the Act; and

4. TIMING AND FREQUENCY. — When an increase in price occurs during a period of and inconsistent with a prevailing oil industry advisory issued in accordance with Rule V Section 19-A of the Implementing Rules and Regulations of R.A. 8479.

In determining whether or not an increase in price is "unreasonable", the Task Force shall give due consideration to the interaction of all local and international factors affecting the price of petroleum products. The Task Force may consider such other factors not included in the parameters set forth in this Section as may be relevant under the circumstances."

SECTION 4. Section 7 of the Resolution is renumbered into Section 6 and hereby amended to read as follows:

"SEC. 6. Resolution of Task Force. — The Task Force shall prepare a written Resolution on the results of investigation of the report within thirty (30) days after the commencement thereof. The Resolution shall state whether or not there has been an unreasonable rise in the price of a petroleum product or if evidence warrants/probable cause exists for the filing of a criminal complaint against the respondent for cartelization or predatory pricing. The Secretaries of DOE and DOJ, and all concerned parties, shall be furnished with copies of the Resolution. The DOE Secretary may make said Resolution public. CITSAc

SECTION 5. Section 9 of the Resolution is renumbered into Section 8 and is hereby amended to read as follows:

"SEC. 8. Filing of Complaint. — If the evidence warrants/probable cause exists for the filing of a complaint for cartelization, predatory pricing or unreasonable rise in the price of petroleum product as determined by the State Prosecutor, the Task Force shall approve the resolution and, thereafter refer the same to the Provincial or City Prosecutor having jurisdiction of the case for the filing of the appropriate criminal complaint with the Regional Trial Court of the place where the defendant or any of the defendants reside or has his place of business."

SECTION 6. Effectivity. — These Rules shall take effect fifteen (15) days after its publication in a newspaper of general circulation.

DONE in the City of Manila this 14th day of July 2008.

For the Department of Energy:

(SGD.) ROY V. KYAMKO

Undersecretary

For the Department of Justice:

(SGD.) JOSE VICENTE B. SALAZAR

Undersecretary

AMENDED MEMORANDUM OF AGREEMENT

KNOW ALL MEN BY THESE PRESENTS:

This Amended Memorandum of Agreement made and entered into by and between:

The DEPARTMENT OF ENERGY, with principal office address at Merritt Road, Fort Bonifacio, Taguig City, represented by its Secretary, ANGELO T. REYES, hereinafter referred to as DOE,

and

The DEPARTMENT OF JUSTICE, with principal office address at Padre Faura Street, Ermita, Manila, represented herein by its Secretary RAUL M. GONZALEZ, hereinafter referred to as DOJ.

WITNESSETH THAT:

WHEREAS, on 12 March 1998, the DOE and the DOJ entered into a Memorandum of Agreement (1998 MOA) creating the DOE-DOJ Task Force and providing its composition, powers, functions as well as appropriation; TACEDI

WHEREAS, there is a need to increase the membership of the DOE side to enhance the greater participation in the deliberation of issues and implementation of programs of action adopted by the DOE-DOJ Task Force in connection with reports on unreasonable prices of petroleum products, commission of prohibited acts under Section 11 of R.A. No. 8479, namely cartelization and predatory pricing and other prohibited acts under Section 12 of the Act;

WHEREAS, there is a need for the Task Force to take a very active role in assessing and evaluating all factors to ensure fair and reasonable pricing of petroleum products as mandated under R.A. No. 8479;

NOW, THEREFORE, in view of the foregoing premises, the DOE and the DOJ hereby stipulate and agree as follows:

Section 1. Section 1 of the 1998 MOA signed by the Parties is hereby amended to read as follows:

Section 1. Creation and Composition. — The DOE-DOJ Task Force is hereby created and shall be composed of an Undersecretary from the DOE and an Undersecretary from the DOJ as Co-Chairmen and the following as members:

DOE

a. Director, Oil Industry Management Bureau of (OIMB)

b. Director, Legal Services (LS)

c. Chief, Hearing Division

d. Chief, Oil Industry Competition and Monitoring Division

e. Chief, Retail Market Monitoring and Special Concerns Division

DOJ

a. Assistant Chief State Counsel

b. Two (2) State Counsels

c. Two (2) State Prosecutors

d. One (1) Assistant Prosecuting Attorney.

Section 2. Powers and Functions. — The DOE-DOJ Task Force shall:

a. Investigate, motu proprio, or upon the report of any person, any threatened, imminent or actual cartelization or predatory pricing, the commission of any violation under Section 12 of the Act or any unreasonable rise in the price of a petroleum product; and in the proper cases, direct the provincial or city prosecutor concerned to file the appropriate criminal complaint; aIAHcE

b. Request the proper court to issue a restraining order or injunction pending the hearing of a criminal complaint for cartelization, predatory pricing or for violation of Section 12 of the Act;

c. Advise the Government or any of its instrumentalities, including government owned or controlled corporations, of any loss or damage in its business or property by reason of violation of Section II of the Act;

d. Submit such report as may be required jointly by the Secretaries of Energy and Justice on the results of any investigation/action it has undertaken;

e. Draft the necessary rules and guidelines to govern the activities of the Task Force; and,

f. Perform such other functions as may be provided under the Act or are jointly assigned to it by the Secretaries of Energy and Justice.

Section 3. Technical and Administrative Support. — The DOE shall provide the technical, administrative and secretariat support to the Task Force, provided that, the DOE-DOJ Task Force may create such committees as may be necessary to fulfill its mandate. It may also call upon any bureau, unit, or office of both Departments for assistance. It shall also have the authority to hire the services of technical consultants as may be deemed necessary.

Section 4. Section 4 is hereby amended to read as follows:

Sec. 4 Funding. — The members of the Task Force, including the Secretariat, shall be granted honoraria pursuant to existing government rules and regulations.

Sec. 5. Effectivity. — This Agreement shall take effect immediately.

Done in the City of Manila this 14th day of July, Two Thousand and Eight.

(SGD.) ANGELO T. REYES		(SGD.) RAUL M. GONZALEZ
Secretary		Secretary
Department of Energy		Department of Justice
	Signed in the presence of:
___________________		___________________

Published in The Philippine Star on July 16, 2008.