Law Summary

1. Extension of Franchise Term

• Explanation: This section extends the term of the franchise originally granted to Consuelo D. Borja under Act No. 3810 for an additional twenty-five years.
• Key Definitions:
  • Franchise: A legal authorization granted to operate a business within specific terms and conditions.
• Requirements/Procedures:
  • The extension is granted under the same terms and conditions as initially provided in Act No. 3810.
  • It is subject to the provisions of the Constitution and Act No. 3636, as amended by Commonwealth Act No. 132.
• Timeframes:
  • The twenty-five-year extension begins from the date of expiration of the original franchise.
• Consequences: None explicitly stated in this section; however, compliance with the terms is implied.

• Franchise extended for 25 years from original expiration date.
• Continuation of terms and conditions as per original Act No. 3810.
• Subject to constitutional provisions and relevant amendments.

2. Franchise Tax Obligation

• Explanation: The grantee is required to pay a franchise tax based on gross earnings derived from the franchise.
• Key Definitions:
  • Franchise Tax: A tax imposed on the gross earnings of the franchise holder.
• Requirements/Procedures:
  • The tax rate is set at 5% of gross earnings.
  • Distribution of tax:
    • 3% to the national government.
    • 2% to the municipality where the franchise operates.
• Timeframes: Ongoing obligation for the entire duration of the franchise extension.
• Consequences: Non-compliance could lead to penalties as per tax regulations (not specified in the text).

• Franchise tax set at 5% of gross earnings.
• 3% to national government; 2% to local municipality.
• Tax obligation persists throughout the 25-year extension.

3. Transfer and Assignment Restrictions

• Explanation: This section prohibits the grantee from transferring or assigning the franchise without Congressional approval.
• Key Definitions:
  • Usufruct: The right to enjoy the use and advantages of another's property.
• Requirements/Procedures:
  • The grantee, her successors, or assigns cannot lease, transfer, grant usufruct, sell, or assign the franchise.
  • Any merger with another entity also requires Congressional consent.
• Consequences: Unauthorized transfer or assignment may be deemed invalid.

• No leasing, transferring, or selling of franchise without Congressional consent.
• Mergers with other entities also require approval.
• Violations may result in invalidation of the franchise rights.

4. Effectivity of the Act

• Explanation: This section states when the Act will become effective.
• Key Definitions:
  • Effectivity: The date on which the law becomes enforceable.
• Requirements/Procedures:
  • The Act takes effect upon its approval.
• Timeframes: Immediately upon approval.
• Consequences: The franchise extension is activated without delay once approved.

• Act becomes effective immediately upon approval.

Key Takeaways

• The franchise granted to Consuelo D. Borja is extended for 25 years under the same original terms.
• A franchise tax of 5% on gross earnings is mandated, with specific allocations to the national and local governments.
• Transferring or assigning the franchise requires prior approval from Congress.
• The Act is effective immediately upon approval, ensuring prompt enforcement of its provisions.