The Supreme Court has approved the “Rule on Administrative Search and Inspection” under the Philippine Competition Act or Republic Act No. 10667 to help in the investigation and prosecution of competition law offenses.
In an en banc Resolution dated Sept. 10, 2019, the SC resolved that the rule on administrative search and inspection shall govern the application, issuance and enforcement of an inspection order for administrative investigations of alleged violations of the PCA, its implementing rules and regulations, and other competition laws.
The rule will take effect on Nov. 16, 2019.
The PCA is the primary competition policy of the Philippines for promoting and protecting competitive market. It defines and penalizes anti-competitive agreements, abuse of dominant position, and anti-competitive mergers and acquisitions.
It also gives the Philippine Competition Commission the power, upon order of the court, to undertake inspections of business premises and other offices, land and vehicles, as used by the entity, where it reasonably suspects that relevant books, tax records, or other documents which relate to any matter relevant to the investigation are kept, in order to prevent the removal, concealment, tampering with, or destruction of the books, records or other documents.
“However, the detection, investigation and prosecution of violations of the PCA and related laws require a rule of procedure for the application, issuance and implementation of inspection orders in competition cases,” the SC said in a statement.
The high court explained that an inspection order is an order in writing issued in the name of the Republic, signed by a judge, upon application by the PCC. It can be applied with the designated Special Commercial courts in Quezon City, Manila, Makati, Pasig, Cebu City, Iloilo City, Davao City, and Cagayan de Oro City.
“All applications for an inspection order shall be acted upon within 24 hours from its filing,” the Court said.
The high court pointed out that the inspection order shall be issued if the court finds that there is a reasonable ground to suspect that the information is kept, found, stored, or accessible at the premises indicated in the application; the information relates to any matter relevant to the investigation; and the issuance of the order is necessary to prevent the removal, concealment, tampering with, or destruction of the books, records, or other documents to be inspected.
The Rule was drafted by the Special Committee for the Rules on Inspection chaired by Justice Diosdado M. Peralta. The Special Committee was created to draft the Rule to ensure that the exercise of the power granted under the PCA is effective, objective, efficient, and provides a balance between the right to due process and the strong public interest in the enforcement of the law.
The Special Committee is vice-chaired by Justice Alexander G. Gesmundo (Vice Chairperson), with Justice Ramon Paul L. Hernando, Court Administrator Jose Midas P. Marquez, PCC Commissioners Amabelle C. Asuncion, Johannes R. Bernabe, and Macario R. de Claro, Jr., Atty. Rigor R. Pascual, Atty. Genevieve E. Jusi, Atty. Gifany L. Tongohan. The secretariat consists of Atty. Ralph Jerome D. Salvador, Atty. Camille Sue Mae L. Ting, and Atty. Noreen B. Bragas as members.
“Inspections and “dawn raids” conducted by competition law agencies abroad are effective tools in investigating and prosecuting competition law offenses, in order to gather information which are not usually provided by entities through voluntary or compulsory means. They have empowered competition agencies in tracking down such offenses, especially hardcore cartels, that is, anti-competitive agreements whereby competitors to fix prices, submit collusive tenders or bids, restrict output or divide or share markets,” the tribunal explained.
The Philippine Judicial Academy, the SC’s education arm, will soon conduct training seminars for special commercial court judges to familiarize them with the Philippine Competition Act and related implementing rules and regulations, as well as the rule on “dawn raids,” the SC announced.
In a related development, the SC said it would adopt what it called “The Rules of Procedures for Admiralty Cases” that will provide guidance to regional trial courts in the resolution of admiralty or maritime cases such as contracts, torts, injuries or offenses that take on navigable waters, among others.
During a separate en banc session on September 17, 2019, the SC promulgated the A.M. No. 19-08-14-SC otherwise known as The Rules of Procedure for Admiralty Cases intended to provide Philippine courts with a special and summary procedure for admiralty cases as define by the Judiciary Reorganization Act of 1980 or Batas Pambansa Blg. 129.
The rules were drafted after the creation of the Special Committee for The Rules of Procedure for Admiralty Cases under Memorandum Order No. 23-2019 dated April 3, 2019. The Special Committee is headed by Supreme Court Associate Justices Diosdado M. Peralta and Alexander G. Gesmundo as the Chairperson and Vice Chairperson, respectively.
It will govern the procedure in civil actions before the designated Admiralty courts involving claims and cases in admiralty filed on the basis of shipping and other related laws, rules, and regulations.
Under A.M. NO. 03-03-03-SC dated June 21, 2016, cases involving admiralty and maritime laws are currently under the jurisdiction of Regional Trial Courts designated as “Special Commercial Courts.”
“In order to enhance the administration of justice in Admiralty cases in the Philippines through the development of judicial expertise, and to provide parties in Admiralty cases a fast, reliable, and efficient means of recourse to Philippine courts, the Supreme Court saw it fit to provide Regional Trial Courts with a special and summary procedure for Admiralty cases as defined by The Judiciary Reorganization Act of 1980,” the SC said in a statement.
Under new rules, the high tribunal shall designate existing branches of RTCs as admiralty courts which shall have jurisdiction over all actions in admiralty cases.
The regular procedure prescribed in the Rules of Court, and other pertinent Supreme Court Circulars and Resolutions, shall apply to The Rules of Procedure for Admiralty Cases in a suppletory capacity.
The SC said the Philippine Judicial Academy will be training judges and courts personnel to effectively implement the new rules on maritime cases.
“The application and adherence to The Rules shall also be subject to periodic monitoring through the Office of the Court Administrator (OCA). For this purpose, all designated Admiralty courts shall accomplish and submit a periodic report of data in a form to be generated and distributed by the OCA,” the high court said.
The Rules shall take effect on January 1, 2020 following its publication in the Official Gazette or in two papers of national circulation, the high court said.