Question & AnswerQ&A (Republic Act No. 10149)
The short title of Republic Act No. 10149 is the "GOCC Governance Act of 2011."
The policy is for the State to actively exercise its ownership rights in government-owned or -controlled corporations (GOCCs) and ensure their operations align with national development policies to promote economic development and fiscal discipline.
A GOCC is any agency organized as a stock or nonstock corporation vested with functions relating to public needs, owned by the Philippine government either wholly or with at least a majority of the outstanding capital stock.
The Governance Commission for Government-Owned or -Controlled Corporations (GCG) is created as the central advisory, monitoring, and oversight body attached to the Office of the President.
The GCG evaluates based on standards such as the irrelevance of the GOCC's functions to the State, duplication of functions, failure to achieve objectives, dormancy, involvement in activities better suited for the private sector, and the need for consolidation under a holding company.
Appointive Directors are appointed by the President of the Philippines from a shortlist prepared by the GCG, with nominees meeting the Fit and Proper Rule criteria.
The term of office for each Appointive Director is one year, unless sooner removed for cause, and they may continue in office until their successor is appointed.
They must act with utmost loyalty, due care, avoid conflicts of interest, apply sound business principles to ensure financial soundness, and employ only fit and proper officers, always acting in the best interest of the GOCC.
They must make restitution within 30 days after demand, and failure to do so may result in imprisonment of one year, a fine twice the amount to be restituted, and possible disqualification from holding public office.
GOCCs must maintain a publicly accessible website posting annual audited financial and performance reports, audited financial statements for the past five years, corporate budgets, compensation packages, borrowings, performance scorecards, subsidies, government-guaranteed borrowings, and other reports required by the GCG.