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EXECUTIVE SECRETARY VS SOUTHWING HEAVY INDUSTRIES, INC. G.R. NO. 164171. FEBRUARY 20, 2006
FACTS:
On December 12, 2002, President Gloria Macapagal Arroyo issued Executive Order 156 entitled "Providing for a comprehensive industrial policy and directions for the motor vehicle development program and its implementing guidelines." The said provision prohibits the importation of all types of used motor vehicles in the country including the Subic Bay Freeport, or the Freeport Zone, subject to a few exceptions. Consequently, three separate actions for declaratory relief were filed by Southwing Heavy Industries Inc., Subic Integrated Macro Ventures Corp, and Motor Vehicle Importers Association of Subic Bay Freeport Inc. praying that judgment be rendered declaring Article 2, Section3.1 of the EO 156 unconstitutional and illegal. The RTC rendered a summary judgment declaring declaring that Article 2, Section 3.1 of EO 156 constitutes an unlawful usurpation of legislative power vested by the Constitution with Congress and that the proviso is contrary to the mandate of Republic Act 7227(RA7227) or the Bases Conversion and Development Act of 1992 which allows the free flow of goods and capital within the Freeport. Appeal in the CA was denied. ISSUES:
Whether or not the Executive Order banning the importation of used vehicles through the Free Trade Zone is valid. HELD:
NO. EO 156, exceeded the scope of its application by extending the prohibition on the importation of used cars to the Freeport, which RA 7227, considers to some extent, a foreign territory. The domestic industry industry which the EO seeks to protect is actually the "customs territory" which is defined under the Rules and Regulations Implementing RA 7227 which states: "the portion of the Philippines outside the Subic Bay Freeport where the Tariff and Customs Code of the Philippines and other national tariff and customs laws are in force and effect."
