Question & AnswerQ&A (PRESIDENTIAL DECREE NO. 715)
The primary purpose of Presidential Decree No. 715 is to amend Section 2-A of Commonwealth Act No. 108 (the Anti-Dummy Law) to clarify the conditions under which aliens may participate as members of the board of directors or governing body of corporations or associations engaged in partially nationalized activities, allowing such representation proportionate to their share in the corporation's capital.
Section 2-A prohibits any person or corporation from allowing the use or enjoyment of rights, franchises, privileges, properties, or businesses reserved by the Constitution or law to Filipino citizens or corporations with at least 60% Filipino ownership, to unqualified persons or entities, or from permitting unqualified persons to intervene in management or control roles.
Violators face imprisonment from five to fifteen years, a fine of not less than the value of the right, franchise, or privilege enjoyed or acquired in violation but not less than five thousand pesos, and forfeiture of such right, franchise, privilege, or property.
Yes, aliens are allowed to be elected as members of the board of directors or governing bodies of such corporations or associations, but only in proportion to their allowable participation or share in the capital of the entity.
At least 60% of the capital of the corporation or association must be owned by Filipino citizens to be qualified under the law for certain reserved rights or privileges.
The president, managers, or persons in charge of corporations, associations, or partnerships violating the provisions are also criminally liable in lieu of other persons.
Rights, franchises, privileges, properties, or businesses the exercise or enjoyment of which are expressly reserved by the Constitution or laws to Filipino citizens or corporations with Filipino ownership.
Yes, foreign technical personnel may be employed if specifically authorized by the Secretary of Justice.
Such property, right, franchise, privilege, or business shall be forfeited in addition to the penalties imposed.
The Decree took effect immediately upon its signing on May 28, 1975.