Title
Tio vs. Videogram Regulatory Board
Case
G.R. No. L-75697
Decision Date
Jun 18, 1987
A 1985 decree creating the Videogram Regulatory Board and imposing a 30% tax on gross receipts was upheld as constitutional, addressing film piracy, revenue loss, and industry regulation.

Case Digest (G.R. No. L-75697)
Expanded Legal Reasoning Model

Facts:

  • Background of the Decree
    • Presidential Decree No. 1987 (“the Decree”) was promulgated on October 5, 1985 and took effect on April 10, 1986, creating the Videogram Regulatory Board (BOARD) with broad powers to regulate the videogram industry.
    • Presidential Decree No. 1994 (November 5, 1985) amended the National Internal Revenue Code to impose an annual tax of ₱5 on each processed video-tape cassette and sales tax on blank tapes.
  • Petition and Intervention
    • On September 1, 1986, petitioner Valentin Tio (doing business as OMI Enterprises) filed a petition before this Court, on his own behalf and purportedly on behalf of other videogram operators, challenging the constitutionality of the Decree.
    • On October 23, 1986, three industry associations (Greater Manila Theaters Association; Integrated Movie Producers, Importers and Distributors Association of the Philippines; Philippine Motion Pictures Producers Association) were permitted to intervene (“Intervenors”), alleging threatened survival of their members from unregulated film piracy.
  • Preambular Clauses of the Decree
    • Proliferation of videograms caused a 40% decline in theater attendance and P450 million annual revenue loss to government.
    • Videogram establishments earned P600 million per annum untaxed, depriving the government of P180 million in taxes.
    • Unregulated videograms threatened investment (P3 billion), employment (75,000 families; 500,000 workers), moral well-being of youth, and enforcement of censorship and copyright laws.
  • Grounds of Attack by Petitioner
    • Section 10’s 30% tax on gross receipts is a non-germane rider in violation of the single-subject rule.
    • The tax is harsh, confiscatory, oppressive, and restrains trade (due process violation).
    • Lack of factual or legal basis for the President’s exercise of emergency legislative power under Amendment No. 6, 1973 Constitution.
    • Undue delegation of legislative power to the BOARD.
    • The Decree is ex post facto in operation (Section 15’s registration requirement creates presumptions).
    • Overregulation of the video industry as if it were a nuisance.

Issues:

  • Title-Subject Compliance
    • Does Section 10’s tax provision constitute a non-germane “rider” beyond the Decree’s title?
  • Validity of the Tax
    • Is the 30% tax oppressive or confiscatory, violating due process/security of trade?
  • Emergency Legislative Power
    • Was there a sufficient factual/legal basis for promulgation under Amendment 6’s emergency grant?
  • Delegation of Legislative Power
    • Does authorization in Section 11 for the BOARD to solicit assistance and deputize government units amount to an unconstitutional delegation?
  • Ex Post Facto Principle
    • Does Section 15’s prima facie presumption of violation for non-registered videograms violate the ex post facto clause?
  • Overregulation
    • Is the Decree so excessive that it unjustifiably impairs or destroys the videogram industry?

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)

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