Question & AnswerQ&A (Republic Act No. 529)
The main purpose of Republic Act No. 529 is to assure uniform value to Philippine coin and currency by regulating the value of money to maintain equal and stable power of every peso issued by the Philippines in the markets and in the payment of debts.
Section 1 declares that any provision in an obligation that gives the obligee the right to require payment in gold, a particular kind of coin or currency other than Philippine currency, or in an amount measured thereby, is against public policy, null, void, and of no effect.
Contracts requiring payment in a particular foreign currency are void if incurred after the enactment of this Act. For those incurred prior, they shall be discharged in Philippine currency measured at the prevailing exchange rate at the time the obligation was incurred, except if the loan is stipulated to be payable in the same foreign currency, then the rate at the time of payment applies.
All coin and currency, including Central Bank notes, issued and declared by the Government of the Philippines, are legal tender for all public and private debts.
No. The Act applies to all obligations, whether incurred before or after its enactment, rendering provisions requiring foreign currency or gold payment null and void and specifying how prior obligations are to be discharged.
Any such provision is declared against public policy, null, void, and of no effect, and no such provision shall be included in any new obligations.
If a loan is made in a foreign currency and is stipulated to be payable in the same foreign currency, the obligation shall be discharged at the rate of exchange prevailing at the time of the stipulated payment date.
Section 2 of Republic Act No. 529 repeals all acts and parts of acts inconsistent with this Act.
Republic Act No. 529 took effect upon its approval on June 16, 1950, as stated in Section 3.
Because the value of Philippine coin and currency affects public interest and improper provisions can obstruct the Congress's power to regulate money, affecting the stable and equal value of the peso.