Title
Presidential Takeover of Public Services
Law
Commonwealth Act No. 496
Decision Date
Sep 30, 1939
Commonwealth Act No. 496 grants the President of the Philippines the power to take over public services or enterprises during a state of national emergency, allowing for their operation and determining just compensation, with consequences for obstruction or damage, and a reporting requirement to the National Assembly.
A

Presidential Authority to Take Over Public Services or Enterprises

  • The President is vested with authority, limited until the adjournment of the next regular session of the National Assembly, to:
    • Take over any public service or enterprise solely for government use or operation during the emergency.
    • Operate the taken-over services or enterprises.
  • The President may restore operation and possession to the rightful owner when further government use is no longer justified.
  • The Government must pay just compensation for use, occupation, and operation, as determined by the President.
  • If the compensation is unsatisfactory to the owner, the owner receives 75% of the President’s amount as initial payment and may sue for the remainder through eminent domain procedures.
  • The President may promulgate regulations necessary for the Act’s implementation, including employment and compensation of operators.
  • Income from the operation may be used as a revolving fund to sustain continued government use or operation.

Penalties for Interference or Obstruction

  • Any person who obstructs, delays, or hinders government exercise of this authority, or who willfully injures or destroys government-controlled works, properties, or materials, faces:
    • A fine up to six thousand pesos,
    • Imprisonment up to six years, or
    • Both penalties concurrently.
  • Persons or firms holding a franchise or certificate of public convenience who refuse or delay delivery of business to the government under this Act are:
    • Deemed guilty of misuse of franchise or violation of certificate,
    • Subject to ouster through quo warranto or cancellation of their certificate.

Appropriation of Funds

  • An appropriation of Two Million Pesos (or necessary portion) is allocated from the Philippine Treasury to fund the Act's purposes.
  • Fund release requires order from the President and is not recognized in Auditor General’s books until released.

Reporting to the National Assembly

  • The President shall report within ten days of the next regular session regarding actions taken under this Act.

Effectivity of the Act

  • The Act takes effect immediately upon approval.

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