Law Summary

SECTION 1: Grant of Franchise

• Legal Principle: This section grants Jose Asturias the right to establish, operate, and maintain a water supply service for vessels at the port of Tacloban for 25 years.
• Key Definitions:
  • Grantee: Jose Asturias
  • Vessels: Both domestic and foreign ships calling at the port.
• Requirements/Procedures:
  • The grantee must comply with Commonwealth Act No. 146 and the Constitution.
  • The franchise is contingent upon obtaining a certificate of public necessity from the Public Service Commission.
• Timeframes: 25-year duration from the Act’s approval.
• Consequences: The franchise takes effect only upon obtaining the necessary certificate.

• Right to construct, operate, and maintain water supply systems. • Authority to install necessary infrastructure on acquired land. • Obligation to supply water and charge regulated rates.

SECTION 2: Water Supply Negotiations

• Legal Principle: Authorizes the National Water and Sewerage Authority to negotiate rates if the grantee purchases water supply from them.
• Key Definitions:
  • National Water and Sewerage Authority: Entity authorized to negotiate water rates.
• Requirements: None explicitly stated.
• Consequences: Facilitates the grantee's acquisition of water supply.

• Encourages cooperation between the grantee and the National Water and Sewerage Authority.

SECTION 3: Standards for Infrastructure

• Legal Principle: Mandates the use of modern and high-quality equipment for water supply.
• Key Definitions:
  • Apparatus and Appurtenances: Equipment used for water supply.
• Requirements/Procedures:
  • Infrastructure must not obstruct public access to streets and places.
• Consequences: Ensures public safety and convenience.

• Water mains and pipes must be maintained properly in public areas.

SECTION 4: Liability and Compensation

• Legal Principle: Establishes grantee’s liability for damages from negligence or failure to construct.
• Key Definitions:
  • Negligence: Failure to maintain safety and operational standards.
• Requirements:
  • The grantee must keep infrastructure in safe condition.
• Consequences: Liability for damages to government property and individuals.

• Requires the grantee to compensate for damages due to negligence.

SECTION 5: Tax Obligations

• Legal Principle: Outlines the tax responsibilities of the grantee.
• Key Definitions:
  • Franchise Tax: A tax equal to 5% of gross earnings from the franchise.
• Requirements:
  • Payment of all applicable taxes on property and income.
• Consequences: Ensures compliance with tax laws.

• Grantee must pay real estate taxes and a franchise tax.

SECTION 6: Restrictions on Transfer of Franchise

• Legal Principle: Prohibits the grantee from transferring rights without Congressional approval.
• Key Definitions:
  • Usufruct: Legal right to use and benefit from another's property.
• Requirements:
  • Approval required for any lease or transfer of the franchise.
• Consequences: Government can assume control during national emergencies.

• Grants government rights in emergencies affecting public safety.

SECTION 7: Forfeiture of Franchise

• Legal Principle: Allows forfeiture of the franchise for non-compliance.
• Key Definitions:
  • Force Majeure: Unforeseeable circumstances preventing compliance.
• Requirements:
  • Compliance with all terms specified in the franchise.
• Consequences: Forfeiture may occur unless caused by unavoidable circumstances.

• The grantee can contest forfeiture through established legal remedies.

SECTION 8: Government Operation of Water System

• Legal Principle: Allows the government to take over the water system if desired.
• Key Definitions: None explicitly defined.
• Requirements:
  • Grantee must surrender the franchise and equipment at cost minus depreciation.
• Consequences: Ensures government access to essential services.

• Ensures smooth transition of operations to the government if necessary.

SECTION 9: Amendment of Franchise

• Legal Principle: The franchise is subject to changes by Congress as needed.
• Key Definitions: None explicitly defined.
• Requirements: None explicitly stated.
• Consequences: Flexibility for amendments in public interest.

• Ensures that the franchise can adapt to changing public needs.

SECTION 10: Effectivity

• Legal Principle: The Act takes effect upon approval.
• Key Definitions: None explicitly defined.
• Requirements: None explicitly stated.
• Consequences: Immediate operational consideration upon enactment.

• The franchise is effective immediately upon enactment.

Key Takeaways

• Republic Act No. 6502 grants Jose Asturias a 25-year franchise to operate a water supply service for vessels at Tacloban Port, subject to regulatory compliance.
• The grantee is liable for damages and must adhere to strict operational standards while fulfilling tax obligations.
• The franchise is non-transferable without Congressional approval, and the government retains rights to operate the system during emergencies.
• The Act is amendable by Congress, ensuring adaptability to public needs and interests.