Policy and Objectives
- Postal delivery is a basic and strategic public utility provided by the State.
- Duties include collection, sorting, storing, transport, and delivery with urgency, economy, reliability, and security.
- Objectives include:
- Economic, rapid transfer of mail respecting privacy.
- Promote international postal cooperation.
- Offer broad range postal services including philately, money and valuables transfer.
- Ensure revenues cover costs and enable service upgrades.
Creation and Attachment
- Creates Philippine Postal Corporation (the Corporation), attached to the Department of Transportation and Communications (DOTC) for policy coordination.
Responsibilities and Functions
- Collection, handling, transport, forwarding, delivery, returning, and holding of mails nationwide and internationally.
- Disposal of confiscated, undelivered, prohibited, or dead letters except banned substances.
- Planning and operation of nationwide postal system ensuring availability at least ordinary mail service.
Powers of the Corporation
- Charge and prescribe fees for postal services.
- Establish post offices, stations, collection points accessible nationwide with operational economy.
- Issue and sell postage stamps and related postal items.
- Issue money orders or checks, authorize replacements.
- Offer additional postal services non-compulsory and non-discriminatory; no unfair competition.
- Adopt and implement rules and regulations to improve postal system.
Corporate Powers
- Powers under Corporation Code:
- Sue and be sued.
- Enter contracts, manage accounts.
- Acquire, hold, sell, lease property.
- Construct, operate facilities.
- Accept gifts, settle claims.
- Adopt corporate seal.
Board of Directors
- Seven members, initially presidentially appointed including Postmaster General.
- Staggered initial terms; thereafter elected as per Corporation Law.
- Board elects chairman; majority vote for acts.
- Members compensated per meeting attended with limit on monthly total.
- Members must avoid conflict of interest.
Capitalization
- Authorized capital stock of P10 billion.
- Class "A" shares fully subscribed by government, non-transferable to private.
- Class "B" shares available to private entities.
- Government subscription financed through unexpended appropriations, asset valuation, surplus income, and treasury appropriations.
Sources of Funds
- Revenues from postal services including foreign receipts.
- Grants, donations, asset sales, loans.
- Investment income and capital/surplus drawings.
Management of Funds
- Investments allowed in secure instruments as per Board guidelines.
- Deposits in accredited banks.
- Board designates authorized signatories.
Obligations and Borrowing
- May contract loans, issue bonds limited to 50% net worth.
- Foreign loans require Department of Finance concurrence.
- Debt service capped at 20% of previous year’s revenue.
- Obligations are Corporation liabilities unless government-guaranteed.
- Bond issuance requires National Treasurer approval.
Annual Budget
- Corporation prepares income, expenditure, and capital budgets annually.
- Does not require congressional approval unless subsidy or guarantee from treasury is needed.
- Supplementary budgets adopted as needed.
Tax Exemptions
- Exempt from all taxes, customs duties, and fees on specific imported postal materials and equipment.
- Interest and income from loans also tax-exempt.
- Exempt from capital gains tax and local taxes after 1997.
- May offset capital investments against income tax.
Annual Accounts and Audit
- Maintains accounts under commercial accounting standards.
- Publishes annual income and expenditure statements with balance sheet.
- Records official business mail and foregone revenues from franked mail.
- Commission on Audit audits accounts; Board may also hire external auditors.
- Auditor submits annual and special reports to Board.
Annual Report
- Board submits annual report to regulatory agencies and Congress detailing activities, operations, statistics, and productivity indicators.
Management and Personnel
- Board may delegate authority to Postmaster General.
- Board may form committees.
- Postmaster General (CEO) assisted by Assistant Postmasters General.
- Qualifications and appointment rules are set by ownership structure; President initially appoints Postmaster General.
- Salary caps set relative to lowest regular employee salary.
- Postmaster General powers include representation, contracting, staffing decisions, appointment/removal of personnel, delegation.
- Corporation to establish merit-based human resource system with progressive compensation.
- Civil Service Law applies to permanent officers/employees below Assistant Postmaster General if majority government-owned.
- Temporary/casual workers exempt.
- Strikes, slowdowns and work stoppages prohibited; unions allowed.
- Personnel exempted from Compensation and Position Classification Office rules but system to conform with RA 6758.
Regulation of Postal Industry
- DOTC holds exclusive regulatory authority, may delegate to National Telecommunications Commission.
- Regulatory authority registers postal service providers (excluding freight forwarders).
- Regulates and approves Corporation’s postal rates.
- Authority empowered for investigations, searches, arrests, seizures of postal offenses.
- Can issue search warrants and offer rewards.
Transitory Provisions
- Postal Services Office abolished; powers, duties, assets, and liabilities transferred to Corporation.
- Philippine National Bank to transfer Postal Savings Bank funds to Corporation.
- Contracts and records transferred.
- Incumbent Assistant Secretary continues as Postmaster General until successor appointed.
- Employees absorbed based on merit; lay-offs entitled to gratuity and retirement benefits.
- Laid-off employees to refund gratuity if rehired.
Appropriations
- Appropriates unavailed Postal Services Office operating income to Corporation’s capital.
- Appropriates P300 million for employee gratuity.
Savings Clause
- Existing orders, permits, rules remain effective until amended.
- Pending suits or causes of action continue with Corporation.
Miscellaneous Provisions
- Corporation may reopen Postal Savings Bank under financial viability, avoids unfair competition with banks.
- Establishes relations with Bureau of Customs for handling foreign parcels.
- Local governments may contract use or operation of postal facilities.
- Corporation’s liability for mail delivery limited by Universal Postal Union and international agreements.
- Contains separability and repealing clauses.
- Certain franking privileges repealed except specified.
- Act effective 30 days after approval and publication.