Title
Department of Transportation vs. Philippine Petroleum Sea Transport Association
Case
G.R. No. 230107
Decision Date
Jul 24, 2018
The case challenges the constitutionality of the Oil Pollution Management Fund under RA 9483, with petitioners arguing it violates equal protection, due process, and legislative delegation. The Supreme Court upheld the fund, ruling it essential for environmental protection and compensation, with reasonable classification and valid delegation of authority.

Case Summary (G.R. No. 230107)

Enactment of RA 9483 and Establishment of OPMF

In response, Congress enacted RA 9483 (Oil Pollution Compensation Act of 2007) to implement the 1992 Civil Liability and Fund Conventions. Section 22 created an Oil Pollution Management Fund (OPMF) administered by MARINA, financed initially by a ten-centavo per liter impost on oil deliveries by tanker barges and haulers, with future contributions determined by a joint committee. The Fund’s uses include immediate containment, removal, clean-up operations (90% minimum) and research, enforcement, and monitoring activities (10% maximum).

Promulgation of IRR and Committee Composition

The 2016 IRR authorized MARINA to open a trust account for the OPMF, detailed fund sources (impost, fines, grants, appropriations) and prescribed an OPMF Committee: MARINA Administrator (Chair), PCG Commandant (Vice-Chair), representatives from DOTC, PPA, DOE, DENR-EMB, and tanker associations. The Committee sets annual contribution rates and approves transfers, budgets, and fines.

Procedural History at the RTC

Respondents filed a Petition for Declaratory Relief with a prayer for injunction under Rule 63, challenging Section 22(a) and Section 1, Rule IX of the IRR as violating equal protection, due process (confiscatory impost), the rider prohibition, and as an undue delegation of legislative power. RTC Branch 216 granted a preliminary injunction (July 2016) and, on February 22, 2017, declared the provisions unconstitutional.

RTC Findings and Decree

The RTC held that:

  1. Classification limited to oil tankers and barges lacked rational basis;
  2. The ten-centavo impost was confiscatory;
  3. Section 22 constituted a prohibited rider to a bill implementing international conventions;
  4. The delegation to determine future impost rates lacked guiding standards.
    The RTC permanently enjoined implementation and struck down the provisions.

Issues on Review and Petitioners’ Arguments

Petitioners argue that:
• The proper remedy is certiorari under Section 1, Article VIII, not declaratory relief;
• Classification is reasonable and consistent with the Conventions;
• The impost is a valid exercise of police power, not a tax, and not confiscatory;
• The inclusion of the OPMF provision is germane to RA 9483’s purpose;
• The delegation to the OPMF Committee is governed by sufficient standards.

Justiciability and Proper Remedy

The Supreme Court found the constitutional issues justiciable and held that Rule 63 declaratory relief is not the correct remedy for constitutional review. The petition is treated as one for certiorari and prohibition under the Court’s expanded jurisdiction over grave abuse of discretion.

OPMF Provision as Non-Proscribed Rider

Despite RA 9483’s title referencing implementation of Conventions, the SC applied a reasonable construction: the OPMF provision is germane to the general object of ensuring prompt response and compensation for oil pollution under the Conventions, which define “pollution damage” to include prevention, clean-up, and environmental reinstatement. The OPMF is integral rather than extraneous.

Classification and Equal Protection

The Court upheld the classification of oil tankers and barges as a separate class: the Conventions themselves apply only to vessels constructed or adapted to carry oil in bulk. International maritime regulations (SOLAS, MARPOL) also treat oil tankers as a distinct class subject to special safety rules. The classification rests on substantial distinctions and bears a rational relation to the State’s goal of protecting marine resources.

Delegation of Rate-Setting Authority

The SC found no undue delegation: Section 22 sets forth legislative policy and specific standards—purpose of the Fund, allocation percentages (90% clean-up, 10% research/enforcement), permissible uses, and prohibition on personal services expenditures. These parameters provide sufficiently determinate limits for the OPMF Committee’s exercise of discreti

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