The fate of economic Charter Change being pushed in the House of Representatives will be decided by the Filipino people, and not by the members of the Senate or the House of Representatives.
This was among the points highlighted during the ongoing plenary debates on Resolution of Both Houses Number 2 (RBH 2), as the chamber’s lawyers took center stage, with Ako Bicol party-list Rep. Alfredo Garbin, Jr. addressing several issues raised by Bayan Muna Party-list Rep. Carlos Zarate and Senior Deputy Majority Leader and Cavite Rep. Jesus Crispin Remulla.
In response to questions from Remulla, Garbin said that while the Constitution granted Congress the right to propose amendments, “it is the people who have the power to ratify.”
Remulla agreed and stressed that “the job of Congress is to propose amendments and those who would ratify these are the people.”
According to Garbin, this precept “is based on their power of ratification and based on the principle that sovereignty resides in the people and all government authorities emanate from them.”
Remulla had earlier expressed apprehensions that the inaction of the Senate on proposals to amend the Constitution would be tantamount to senators unilaterally deciding on the fate of the economic Charter amendments.
Remulla pointed out that proposals to amend the Constitution were also discussed during the terms of President Gloria Macapagal Arroyo and President Benigno Aquino III, but these were also not acted on by the Senate.
Zarate for his part was wary that unlike the House, “some political amendments can be discussed and even proposed in the Senate.”
“I fully understand your apprehension but we cannot dictate how the proceedings would roll in the Senate,” Garbin said.
Garbin said it was premature to preempt the action of the Senate on the proposed economic Charter Change.
In the Senate, Minority Leader Franklin Drilon said the immediate passage of the amendments to the Retail Trade Liberalization Act would take off the steam that powers the Charter Change train in the House of Representatives.
Senate plenary discussed Senate Bill 1840 or the proposed amendments to RA 8762, which seeks to further relax foreign restrictions by removing investment categories and setting an across-the-board minimum paid up capital investment equivalent of $300,000 in Philippine peso.
“By amending the Foreign Investments Act, further relaxing retail trade restrictions and amending the public service law, the Philippines will generate up to $30 billion in foreign direct investment a year,” Drilon said.
“The proposed Cha-cha in the House of Representatives simply seeks to add the phrase ‘unless otherwise provided by law’ to address the so-called economic provisions of the Constitution. But what we need now to address the economic slowdown is a concrete solution through the enactment of various economic measures such as the amendments to the Retail Trade Liberalization Act and the Public Service Act,” explained Drilon.
Drilon is the principal author of the said measure or Senate Bill 1840. The measure was sponsored by Senate Committee on Trade chairman Senator Aquilino Pimentel III.
“Amending the Retail Trade Liberalization Act will address a number of foreign investment roadblocks,” he said.
Under the current Retail Trade Liberalization Act, enterprises with a paid-up capital below US$2.5 million in peso equivalent are reserved exclusively for Filipino citizens and corporations wholly owned by Filipino citizens.
The bill removes the investment categories and sets a minimum paid up capital investment equivalent of US$300,000 in Philippine peso for foreign retailers.
Drilon said that 26 years after the passage of RA 8762, “the Philippines still has a very poor retail trade investments portfolio.”
He said the country continued to adhere to the same protectionist policy under the 1954 Retail Trade Nationalization Law despite the passage of the 2000 retail trade liberalization law.
That resulted in the Philippines lagging behind in terms of foreign investments, he added.
Over a five-year period from 2012 to 2016, Southeast Asian nations received an average of US$17 billion in foreign retail sector investment. The share of the Philippine total during the same period averaged $107 million or 0.006 percent, he added.
Drilon cited that in 2016 alone, the Philippines received only $101 million in foreign retail sector investment, while Thailand had $3.2 billion, Malaysia got $2.5 billion, Indonesia secured $2 billion, and Vietnam received $2 billion.
He said Singapore received over $8 billion, almost more than all other ASEAN economies combined. Singapore has no restrictions on foreign investment in retail and enjoys a per capita income of $88,000.
As of 2021, there are only 46 foreign retail corporations registered with DTI, or a growth of 2 retailers per year since 2000, he noted.
The amendment to the Retail Trade Liberalization Act is among the identified 11 priority measures by Legislative-Executive Development Advisory Council.