Case Digest (G.R. No. 155001)
Facts:
In Congressman Enrique T. Garcia v. Board of Investments, G.R. No. 92024, decided on November 9, 1990 under the 1987 Constitution, petitioner Congressman Enrique T. Garcia challenged the BOI/DTI’s Resolution No. 193 (May 23, 1989) that approved the transfer of the Bataan Petrochemical Corporation (now Luzon Petrochemical Corporation or LPC) plant site from Limay, Bataan to Batangas and authorized a change in feedstock from naphtha only to naphtha and/or LPG. In 1981, P.D. 1803 reserved 576 hectares in Limay, Bataan as a petrochemical zone under PNOC’s administration. In February 1988, BOI issued BPC a pioneer registration certificate, granting fiscal incentives, tax exemptions (including the later RA 6767 ad valorem tax exemption on naphtha), repatriation privileges and access to local loans. In January 1989, A.T. Chong of the major Taiwanese proponent wrote Secretary Concepcion proposing the shift to Batangas on grounds of insurgency, labor instability and proximity to PiliCase Digest (G.R. No. 155001)
Facts:
- Reservation of Petrochemical Zone and Initial Project Registration
- Presidential Decree No. 1803 (January 16, 1981) reserved 576 hectares in Lamao, Limay, Bataan as the Petrochemical Industrial Zone under PNOC administration.
- Bataan Refining Corporation (BRC), a government-owned corporation in Bataan, produced 60% of the country’s naphtha, the feedstock originally proposed for the plant.
- Formation of Bataan Petrochemical Corporation (BPC) and Original BOI Registration
- Taiwanese investors formed BPC, applied with the BOI specifying Limay, Bataan as site and naphtha as feedstock; on February 24, 1988, BOI granted registration with pioneer status and incentives (tax exemptions, repatriation of proceeds, remittance of earnings); RA 6767 further exempted naphtha from ad valorem tax.
- House Bill (introduced by petitioner Garcia) eliminated the 48% ad valorem tax on naphtha for petrochemical use.
- Proposed Amendments and BOI Approval
- In early 1989, BPC’s major investor sought amendments—site transfer to Batangas (citing insurgency and proximity to Shell’s LPG depot), increased capitalization and capacity, and feedstock change to “naphtha and/or LPG.” Opposition arose from petitioner, President Aquino, and legislators.
- BPC formally filed amendments on April 11, 1989; BOI denied petitioner’s request for amendment documents; on May 23, 1989, BOI Resolution No. 193 approved all proposed changes. BOI Vice-Chairman testified BOI could only recommend location and respected investor’s “final choice.”
- Prior Supreme Court Proceedings (G.R. No. 88637)
- Petitioner’s first certiorari petition (Sept. 7, 1989 decision) ordered BOI to publish amendments, grant record access (excluding trade secrets), and hold a 10-day hearing on petitioner’s opposition; denied writ of prohibition.
- Petitioner’s motions for partial reconsideration (Sept. 19 & Oct. 24, 1989) raised P.D. 949/1803 and investor’s claimed final-choice right; majority denied, minority urged hearing. January 17, 1990 resolution clarified “no right of final choice” under Constitution or Investments Code; investor’s choice is subject to BOI approval.
- Present Petition (G.R. No. 92024)
- Petitioner challenges BOI’s Resolution No. 193 as grave abuse of discretion, invoking constitutional duty (Art. VIII, Sec. 1) to settle controversies and determine lack/excess of jurisdiction.
- Core dispute: whether BOI unlawfully yielded to investor’s preference in transferring site and changing feedstock contrary to national interest.
Issues:
- Did the BOI commit grave abuse of discretion in approving the transfer of the petrochemical plant site from Bataan to Batangas?
- Did the BOI commit grave abuse of discretion in authorizing the change of feedstock from naphtha only to naphtha and/or LPG?
- Can a foreign investor’s “final choice” of plant site and feedstock supersede BOI’s sovereign approval power and national-interest considerations?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)