Separate Concurring Opinion
MENDOZA, J.:
I take the view that in the context of the present controversy the only way to enforce the constitutional mandate that “[i]n the grant of rights, privileges and concessions covering the national patrimony the State shall give preference to qualified Filipinos”[1] is to allow petitioner Philippine corporation to equal the bid of the Mlaysian firm Renong Berhad for the purchase of the controlling shares of stocks in the Manila Hotel Corporation. Indeed, it is the only way a qualified Filipino or Philippine corporation can be given preference in the enjoyment of a right, privilege or concession given by the State, by favoring it over a foreign national or corporation.
Under the rules on public bidding of the government Service and
Insurance System, if petitioner and the Malaysian firm had offered the same
price per share, “priority [would be given] to the bidder seeking the larger
ownership interest in MHC,“[2] so that if petitioner bid for more shares,
it would be preferred to the Malaysian corporation for that reason and not
because it is a Philippine corporation.
Consequently, it is only in cases like the present one, where an alien
corporation is the highest bidder, that preferential treatment of the
Philippine corporation is mandated not by declaring it winner but by allowing
it “to match the highest bid in terms of price per share” before it is awarded
the share of stocks.[3]That, to me, is what “preference to qualified
Filipinos” means in the context of this case – by favoring Filipinos whenever
they are at a disadvantage vis-avis foreigners.
This was the meaning given in Co Chiong v. Cuaderno[4] to a 1947 statute giving “preference to
Filipino citizens in the lease of public market stalls.”[5] This Court upheld the cancellation of
existing leases covering market stalls occupied by persons who were not
Filipinos and the award thereafter of the stalls to qualified Filipino vendors
as ordered by the Department of Finance.
Similarly, in Vda. de Salgado v. De la Fuente,[6] this Court sustained the validity of a
municipal ordinance passed pursuant to the statute (R.A. No. 37), terminating
existing leases of public market stalls and granting preference to Filipino
citizens in the issuance of new licences for the occupancy of the stalls. In Chua Lao v. Raymundo,[7] the preference granted under the statute was
held to apply to cases in which Filipino vendors sought the same stalls
occupied by alien vendors in the public markets even it there were available
other stalls as good as those occupied by aliens. “The law, apparently, is applicable whenever there is a conflict
of interest between Filipino applicants and aliens for lease of stalls in
public markets, in which situation the right to preference immediately arises.”[8]
Our legislation on the matter thus antedated by a quarter of a
century efforts began only in the 1970s in America to realize the promise of
equality, through affirmative action and reverse discrimination programs
designed to remedy past discrimination against colored people in such areas as
employment, contracting and licensing.[9] Indeed, in vital areas of our national
economy, there are situations in which the only way to place Filipinos in control
of the national economy as contemplated in the Constitution[10] is to give them preferential treatment where
they can at least stand on equal footing with aliens.
There need be no fear that thus preferring Filipinos would either
invite foreign retaliation or deprive the country of the benefit of foreign
capital on know-how. We are dealing
here not with common trades or common means of livelihood which are open to
aliens in our midst,[11] but with the sale of government property,
which is like the grant of government largess or benefits. In the words of Art. XII, §10, we are
dealing here with “rights, privileges, and concessions covering the national
economy” and therefore no one should begrudge us if we give preferential treatment
to our citizens. That at any rate is
the command of the Constitution. For
the Manila Hotel is a business owned by the Government. It is being privatized. Privatization should result in the
relinquishment of the business in favor of private individuals and groups who
are Filipino citizens, not in favor of aliens.
Nor should there be any doubt that by awarding the shares of
stocks to petitioner we would be trading competence and capability for
nationalism. Both petitioner and the
Malaysian firm are qualified, having hurdled the prequalification process.[12]
It is only the result of the public bidding that is sought to be modified by
enabling petitioner to up its bid to equal the highest bid.
Nor, finally, is there any basis for the suggestion that allow a
Filipino bidder to match the highest bid of an alien could encourage
speculation, since all that a Filipino entity would then do would be not to make
a bid or make only a token one and, after it is known that a foreign bidder has
submitted the highest bid, make an offer matching that of the foreign firm. This is not possible under the rules on
public bidding of the GSIS. Under these
rules there is a minimum bid required (P36.67 per share for a range of 9
to 15 million shares).[13] Bids below the minimum will not be
considered. On the other hand, if the
Filipino entity, after passing the prequalification process, does not submit a
bid, he will not be allowed to match the highest bid of the foreign firm
because this is a privilege allowed only to those who have “validly submitted
bids.”[14] The suggestion is, to say the least,
fanciful and has no basis in fact.
For the foregoing reasons, I vote to grant the petition.
[1] Art, XII, §10, second paragraph.
[2] GUIDELINES AND
PROCEDURES: SECOND PREQUALIFICATION AND PUBLIC BIDDING OF THE MHC PRIVATIZATION
(hereafter referred to as GUIDELINES), Part V, par. H(4).
[3] Id.
[4] 83 Phil. 242 (1949).
[5] R.A. No. 37, §1.
[6] 87 Phil. 343 (1950).
[7] 104 Phil. 302
(1958).
[8] Id., at 309.
[9] For an excellent
analysis of American cases on reverse discrimination in these areas, see GERALD
GUNTHER, CONSTITUTIONAL LAW 780-819 (1991).
[10] Art. II, §19: “The State shall develop a self-reliant
and independent national economy effectively controlled by Filipinos.”
(Emphasis added)
[11] See Villegas v.
Hiu Chiung Tsai Pao Ho, 86 SCRA 270 (1978) (invalidating an ordinance imposing
a flat fee of P500 on aliens for the privilege of earning a livelihood)
[12] Petitioner passed the criteria set forth in the
GUIDELINES, Part IV, par. F(4), of the GSIS, relating to the following:
a. Business management expertise, track record,
and experience
b. Financial capability
c. Feasibility and
acceptability of the proposed strategic plan for The Manila Hotel
[13] GUIDELINES, Part V
par. C (1)(3), in relation to Part I.
[14] Id., Part V,
par. V (1).