Title
Tanada vs. Angara
Case
G.R. No. 118295
Decision Date
May 2, 1997
The Supreme Court upheld the Philippines' WTO membership, ruling the agreement aligns with constitutional economic goals, does not impair domestic powers, and benefits national development.

Case Summary (G.R. No. 118295)

Key Dates

  • April 15, 1994: Secretary Rizalino Navarro signed the Final Act of the Uruguay Round in Marrakesh, Morocco.
  • August 11–13, 1994: President Ramos transmitted the Final Act and related instruments to the Senate for concurrence.
  • December 14, 1994: Senate adopted Resolution No. 97 concurring in the ratification of the Agreement Establishing the WTO.
  • December 16, 1994: President signed the Instrument of Ratification.
  • December 29, 1994: Petition filed with the Supreme Court.
  • May 2, 1997: Decision rendered (Court used the 1987 Constitution as governing law).

Applicable Law and Constitutional Provisions

Primary constitutional provisions considered (1987 Constitution):

  • Art. II, Sec. 19: State shall develop a self-reliant and independent national economy effectively controlled by Filipinos.
  • Art. XII, Sec. 10: Congress shall enact measures encouraging Filipino-owned enterprises; the State shall give preference to qualified Filipinos in grants of rights, privileges and concessions covering the national economy and patrimony.
  • Art. XII, Sec. 12: State shall promote preferential use of Filipino labor, domestic materials and locally produced goods and adopt measures to make them competitive.
  • Art. XII, Sec. 1 and Sec. 13: Goals of national economy and trade policy based on equality and reciprocity.
  • Art. VIII, Sec. 1 (1987): Judicial power to determine grave abuse of discretion amounting to lack or excess of jurisdiction.

Procedural Posture

Petition for certiorari, prohibition and mandamus under Rule 65 seeking nullification of Senate concurrence and prohibition of implementation of the WTO Agreement and its use of public resources. The Court gave due course and required memoranda and supplemental submissions, including a background paper from the Ambassador to the UN in Geneva.

Facts Relevant to the Dispute

  • The Final Act, signed in Marrakesh, incorporated the WTO Agreement and stated participating representatives would submit the WTO Agreement for approval by their competent authorities and adopt Ministerial Declarations and Decisions.
  • The WTO Agreement includes annexes comprising agreements on trade in goods (GATT 1994 and related instruments), trade in services (GATS), TRIPS (intellectual property), dispute settlement, and trade policy review mechanisms.
  • The President transmitted the Final Act and its components to the Senate and later certified the necessity for immediate adoption. The Senate concurred only in the WTO Agreement and its annexes (Annexes 1–3), not expressly in the Final Act’s Ministerial Declarations and Decisions or the Understanding on Commitments in Financial Services.

Issues Presented

  1. Whether the petition involved a non-justiciable political question.
  2. Whether provisions of the WTO Agreement (and its annexes) contravene Art. II, Sec. 19 and Art. XII, Secs. 10 and 12 of the 1987 Constitution (economic nationalism).
  3. Whether the WTO provisions unduly limit, restrict or impair the legislative power vested in Congress.
  4. Whether WTO provisions unduly interfere with the Supreme Court’s exercise of judicial power (specifically rules of evidence), with emphasis on TRIPS Article 34.
  5. Whether the Senate concurrence was sufficient and valid given that it did not expressly include the Final Act’s Ministerial Declarations, Decisions, and the Understanding on Commitments in Financial Services.

Justiciability and Jurisdiction

The Court held the petition raised a justiciable controversy because it involved alleged grave abuse of discretion by a coordinate branch of government implicating constitutional interpretation and enforcement. The judiciary has the duty to determine whether there has been grave abuse amounting to lack or excess of jurisdiction by Congress (Art. VIII). Procedural defenses like locus standi and estoppel were not pursued by respondents and thus deemed waived; the Court proceeded to decide the merits.

Nature and Weight of the Constitutional Provisions (Self-Executing or Not)

The Court reiterated that Article II (declaration of principles and state policies) generally contains non-self-executing directives intended as guides for legislation and for judicial reference, not as directly enforceable causes of action. Sections of Article XII may be self-executing in specified contexts (e.g., certain parts of Sec. 10 as recognized in case law), but broad economic principles still require legislative implementation in many instances.

Main Merits — Economic Nationalism Versus WTO Obligations

Petitioners argued that WTO provisions adopting national treatment and parity among nationals of member states conflict with the Constitution’s Filipino-first and economic-nationalist directives, effectively nullifying constitutional preferences for Filipinos in ownership, use of labor, domestic materials and locally produced goods. They contended WTO obligations would require conformity of domestic laws and policies with multilateral instruments, thereby impairing constitutionally mandated economic nationalism.

The Court’s analysis and rulings:

  • The economic-nationalist provisions cited by petitioners (Art. II, Sec. 19; Art. XII, Secs. 10 and 12) are important constitutional policies but must be read in context with other constitutional provisions (Art. XII, Secs. 1 and 13) that emphasize goals of equitable development, competitiveness in domestic and foreign markets, and a trade policy based on equality and reciprocity. The Constitution does not mandate isolationism; it contemplates foreign trade and reciprocal arrangements that serve the general welfare.
  • Certain parts of Art. XII (e.g., the second paragraph of Sec. 10) are enforceable in particular situations (grants of rights, privileges, concessions covering national economy and patrimony), but that enforceability does not eliminate the balancing function required by the Constitution among various economic policy mandates.
  • WTO basic principles and preamble expressly recognize special and differential treatment for developing countries and seek to ensure developing countries secure a share in trade growth commensurate with their development needs. Specific WTO provisions allow more lenient schedules and longer timeframes for tariff and subsidy reductions for developing members.
  • The WTO framework provides mechanisms (e.g., anti-dumping, countervailing measures, safeguards) that allow members to protect domestic industries from unfair practices, and the Agreement contains procedural and substantive devices that recognize developmental concerns.
  • Given the constitutional recognition of international law and principles, and the Constitution’s adoption of generally accepted principles of international law as part of the law of the land (Art. II), voluntary treaty obligations that limit aspects of sovereignty are permissible if entered into in good faith and consistent with constitutional processes.

Conclusion on this issue: The Court found no direct contravention of the cited constitutional provisions by the WTO Agreement so as to constitute grave abuse of discretion by the Senate in concurring with ratification.

Legislative Power, Sovereignty, and Treaty Obligations

Petitioners argued the WTO requirement that each member ensure conformity of its laws and regulations with WTO obligations unduly impairs Congress’s legislative power. The Court’s reasoning:

  • Sovereignty is not absolute in international relations; states routinely enter treaties that impose obligations and, by their nature, limit certain exercises of domestic sovereignty. The Constitution itself contemplates adherence to international law and cooperation with other states.
  • The Philippines has previously entered into treaties and international agreements that have limited certain sovereign powers (examples recounted by respondents), and the Constitution allows such engagement.
  • The WTO obligation to bring domestic laws into conformity with treaty commitments is a normal feature of treaty-making and is not per se a usurpation of legislative power. Congress retains its legislative authority and the discretion — including the political process — to manage implementation consistent with constitutional limits.
  • Therefore, the WTO’s conformity requirement does not amount to an unconstitutional impairment of legislative power amounting to grave abuse of discretion.

Judicial Power and TRIPS Article 34 (Burden of Proof)

Petitioners claimed that TRIPS Article 34, which contemplates a rebuttable presumption in certain patent-infringement contexts that an identical product was produced by the patented process, intrudes upon the Supreme Court’s authority to promulgate rules on pleading, practice and procedure and may violate due process.

The Court’s analysis and conclusion:

  • Article 34 requires member states to provide, in civil proceedings concerning process patents, authority to order a defendant to prove that the process used to obtain an identical product differs from the patented process, under specified circumstances (product is new or substantial likelihood of identical process but owner cannot determine the process). The presumption is rebuttable and limited by conditions; members are free to choose among circumscribed implementation options.
  • The burden imposed by Article 34 is better characterized as a burden of producing evidence (burden of going forward) rather than an unconstitutional shift of the ultimate burden of proof. The patent owner retains responsibilities to establish infringement elements (existence of product, identity, newness or substantial likelihood).
  • Philippine law already has analogous presumptions (e.g., Patent Law provisions on identity/substantial identity as evidence of copying). The TRIPS rule does not pose an unreasonable intrusion into judicial procedural autonomy and can be accommodated within existing legal frameworks.
  • The Court found no undue interference with judicial power that would warrant invalidation on constitutional grounds.

Sufficie

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