Maximum Price Fixing for Essential Goods EO 371

Coverage: essential goods and places covered

Section 1(a) fixes basic maximum selling prices for scheduled essential articles including motor fuel alcohol, reinforcing steel bars, cement, corn, corned beef, wheat flour, corn and tapioca flours (gewgaw), gasoline, vegetable lard, milk, meat, mongo, nails, petroleum, rice, sardines, centrifugal sugar, galvanized iron sheets and plain galvanized wire.
Section 1(a) provides that the basic maximum prices apply in Manila and other chartered cities, in various provincial capitals and distributing centers, and in the special municipalities of the province of Romblon specified in the schedules.
Section 2 provides that in municipalities and municipal districts outside the provincial capital or distributing centers within each province, the applicable maximum prices are the basic prices in the schedules (or any later appended schedule) or Special Permit–fixed prices, plus the usual cost of transportation from the provincial capital or distributing center.
Section 2 provides that the usual cost of transportation addition applies until the Provincial Committee determines such usual cost of transportation and the determination is given the publicity required in Section 9.
Section 7 provides that the maximum prices do not apply to purchases by the Government of the Commonwealth of the Philippines (and its subdivisions, agencies, or instrumentalities) or the Government of the United States (and its agencies or instrumentalities) when purchases call for articles of higher quality or different specifications than those ordinarily required under the scheduled lists.
Section 6 provides that scheduled and later fixed prices are maximum retail selling prices, and that sellers to retailers must allow retailers a reasonable percentage of profit.

Basic maximum price rule and brand/class limits

Section 1(a) fixes basic maximum prices in the attached schedules Nos. 1 to 65 and states that these basic maximum prices control in covered jurisdictions.
Section 1(b) prohibits selling any brand or class of a scheduled article (the same as or similar to any basic commodity in the schedules) at prices higher than the maximum prices fixed for the lowest-priced brands or class of the same article.
Section 1(b) provides an exception: a higher-priced brand or class may be sold above the maximum only if, upon proper application, a Special Permit is issued by the Emergency Control Administration determining that the new brand or class is of a class the same as, or similar to the higher-priced basic commodity.
Section 4(a) authorizes Special Permits allowing prices above the fixed maximums only for the specific covered trade in essential commodities when the statutory evidentiary conditions are met.
Section 6 provides that fixed prices remain in force until revoked, altered, or modified, and that the prices are retail maximums.

Special Permits: when higher prices are allowed

Section 4(a) empowers the Emergency Control Administrator to issue Special Permits to importers, producers, manufacturers, wholesalers and retailers to trade at prices higher than fixed in Executive Order No. 371 or amendatory Executive Orders.
Section 4(a)(i) requires satisfactory evidence that the c.i.f. price Philippine port of the commodity to be traded in has increased over the c.i.f. price Philippine port of the party’s present stock.
Section 4(a)(ii) requires satisfactory evidence that cost of production has so increased that producers or manufacturers have no reasonable margin of profit if required to sell at the fixed prices.
Section 4(a)(iii) requires satisfactory evidence that the stock of the importer/producer/manufacturer/wholesaler/retailer at issuance has been exhausted or will soon be exhausted, and that replacement stock must be imported, produced or manufactured at a higher cost.
Section 4(b) authorizes the Emergency Control Administration to reduce maximum selling prices through an Emergency Order if c.i.f. prices of scheduled commodities have declined or if commodities in a distributing center are sold at prices far below the scheduled maxima.
Section 4(b) further authorizes the Emergency Control Administration to direct the Provincial Committee to reduce prices proportionately in municipalities and municipal districts within their respective provinces.
Section 4(c) limits permitted overpricing: no Special Permit to sell above the fixed prices authorizes a price higher than twenty percent (20%) over cost price.

Provincial implementation: transportation and emergency orders

Section 3(a) provides that each province must continue to have the committee created by Executive Order No. 233 (November 8, 1939), composed of the Governor (as chairman), the Provincial Treasurer, and the District Engineer, and that it is renamed as the Provincial Committee of the Emergency Control Board.
Section 3(a) provides that the Provincial Treasurer sets up the secretary of the committee.
Section 3(b) requires the Provincial Committee, within three (3) days from receipt of this Executive Order or amendments, or receipt of any Special Permit issued by the Emergency Control Administrator, to determine the usual cost of transportation between the provincial capital (or other distributing center) and each municipality or municipal district within the province.
Section 3(c) requires the Provincial Committee’s transportation determination to be embodied in a Provincial Emergency Control Order, serially numbered, fixing the maximum retail selling price for each essential article in each municipality or municipal district covered by basic maximum prices fixed in the Executive Order or by Special Permit for the provincial capital/distributing center.
Section 3(c) requires the Provincial Emergency Control Order and its schedules to be given the publicity required under Section 9.

Enforcement powers and compliance duties

Section 5(a) empowers the Emergency Control Administrator to appoint agents or officers/employees of national, provincial, or municipal governments or government-owned/controlled corporations to conduct necessary investigations and surveys, or to designate Internal Revenue Agents as deputies subject to the approval of the Secretary of Finance.
Section 5(b) empowers the Emergency Control Administrator to prescribe forms and issue preliminary Special Permits or Emergency Orders necessary to make the authority effective.
Section 5(c) empowers the Emergency Control Administrator to cause the inspection of bodegas and/or storerooms of importers, manufacturers, producers, wholesalers, or retailers where scheduled essential commodities are stored.
Section 5(d) empowers the Emergency Control Administrator to require importers, purchasers, manufacturers, wholesalers, and retailers to keep records of their stocks of the scheduled commodities, subject to inspection by the Administrator or his agents/deputies.
Section 6 provides that price schedules and subsequent prices remain maximum retail selling prices and require that sellers to retailers must allow retailers a reasonable percentage of profit.
Section 9(b) imposes a duty on every mayor to furnish each retail store owner in the jurisdiction with a copy of the schedules appended to the Executive Order or issued by the Emergency Control Administrator or the Provincial Committee.
Section 9(c) requires retail store owners to post in a conspicuous place at the store entrance a complete list of sold articles subject to fixed prices, showing the respective local maximum selling prices.

Complaints and reporting channel

Section 8 requires that complaints regarding non-observance or improper observance of this Order and its amendments, or noncompliance with any Special Permit/Emergency Order, be reported to the City Fiscal or Provincial Fiscal, depending on the case.
Section 8 requires that a copy of the fiscal report be forwarded to the Emergency Control Administrator at Manila.
Section 8 includes complaints where misrepresentation or misleading description affects the class, weight, gauge, or quality of the article sold for which a price is fixed.

Penalties for overpricing and obstruction

Section 10 punishes any person, firm, or corporation that sells scheduled essential articles or items under later schedules/Special Permits/Emergency Orders at prices in excess of the maximum selling prices fixed therein.
Section 10 punishes refusal, defiance, or disobedience of any lawful order issued by the Emergency Control Administrator.
Section 10 punishes obstruction of the Emergency Control Administrator or his agents during performance of their duties.
Section 10 punishes failure to post the list required under Section 9(c).
Section 10 imposes punishment “as provided in Articles 5 of Commonwealth Act No. 309” for violations of this Executive Order.
Section 10 treats selling at prohibited prices and violating any provision of the Order as offenses punishable under Commonwealth Act No. 309, Article 5.

Relations with earlier orders and continuity

Section 11 provides that Executive Order No. 371 supplants and supersedes Executive Order No. 233 (November 8, 1939), Executive Order No. 236 (November 29, 1939), Executive Order No. 237 (November 29, 1939), and Executive Order No. 237 (January 2, 1940).
Section 11 provides that supersession does not affect any prosecution, suit, action, proceeding already commenced, or any act done at or before the issuance of Executive Order No. 371.
Section 11 provides that prosecutions, suits, actions, proceedings, and acts related to the earlier enumerated Executive Orders and other orders issued pursuant to Commonwealth Act No. 498 continue in force and effect for those matters.