Question & AnswerQ&A (PRESIDENTIAL DECREE NO. 425)
The main purpose of Presidential Decree No. 425 is to amend certain sections of Republic Act No. 6234 which created the Metropolitan Waterworks and Sewerage System (MWSS). It aims to provide the MWSS with a definite equity base, authorize capital stock, and give fiscal and operational flexibility to meet the increasing water demand in the Manila metropolitan area.
The MWSS is authorized a capital stock of one billion pesos divided into ten million shares at a par value of one hundred pesos each. These shares are subscribed and paid for by the Government of the Philippines and are not transferable or negotiable as security for obligations.
Members must be duly licensed professionals with recognized competence in engineering, business management and finance, or law with at least ten years of actual and distinguished experience in their respective fields and of good moral character.
The Board can organize and reorganize the System's staffing pattern and determine the number of personnel, fix their salaries including other emoluments, and define their powers and duties. WAPCO rules do not apply, but the Board considers similar staffing patterns and compensation in comparable government corporations.
MWSS has the right to construct works across streams, canals, roads, railways, or private lands, provided that such works afford security to life and property and restore the affected areas as near as possible to their former state. They may enter private property lawfully for construction but must compensate property owners based on the fair market value and damages to improvements.
Persons guilty of malicious destruction or interference can be fined between one thousand to five thousand pesos, imprisoned for one to five years, or both, at the court's discretion. Additionally, unauthorized connections to water or sewer lines can be punished by a fine of up to one thousand pesos or imprisonment for up to six months or both.
The total principal indebtedness of the System for domestic borrowing shall not exceed one billion pesos at any given time, exclusive of interest.
MWSS is exempt from the payment of all taxes, duties, fees, imposts, charges, income taxes, franchise taxes, realty taxes, and any fees related to court or administrative proceedings. This includes exemptions from customs duties and advanced sales tax on necessary imported goods for its operations.
The General Manager is appointed by the President of the Philippines and holds office at the President's pleasure. Assistant General Managers are appointed by the Board with the President's approval and must be persons of integrity, competence, and experience in technical and executive fields related to MWSS functions.
MWSS shall adopt measures to prevent environmental pollution, conserve and develop national resources, and improve and beautify reservoirs, filter plants, and other facilities to promote tourism and related purposes.