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  • La Bugal-B'laan Tribal Association v. Ramos Facts

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    This case involved a challenge to the constitutionality of the Philippine Mining Act (RA 7942) and its implementing rules (DAO 96-40) on the grounds that they allowed foreign ownership of mining companies in violation of the Constitution. The Supreme Court ultimately upheld most provisions of the Mining Act and its rules as constitutional, finding that the state retained sufficient control over mining operations conducted under financial and technical assistance agreements with foreign companies. The Court also interpreted the constitutional phrase "Agreement involving either Ethical or Financial Assistance" broadly to allow other forms of foreign assistance beyond just financial and technical.

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    This case involved a challenge to the constitutionality of the Philippine Mining Act (RA 7942) and its implementing rules (DAO 96-40) on the grounds that they allowed foreign ownership of mining companies in violation of the Constitution. The Supreme Court ultimately upheld most provisions of the Mining Act and its rules as constitutional, finding that the state retained sufficient control over mining operations conducted under financial and technical assistance agreements with foreign companies. The Court also interpreted the constitutional phrase "Agreement involving either Ethical or Financial Assistance" broadly to allow other forms of foreign assistance beyond just financial and technical.

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    20 views2 pages

    La Bugal-B'laan Tribal Association v. Ramos Facts

    Uploaded by

    emman carl
    This case involved a challenge to the constitutionality of the Philippine Mining Act (RA 7942) and its implementing rules (DAO 96-40) on the grounds that they allowed foreign ownership of mining companies in violation of the Constitution. The Supreme Court ultimately upheld most provisions of the Mining Act and its rules as constitutional, finding that the state retained sufficient control over mining operations conducted under financial and technical assistance agreements with foreign companies. The Court also interpreted the constitutional phrase "Agreement involving either Ethical or Financial Assistance" broadly to allow other forms of foreign assistance beyond just financial and technical.

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    © All Rights Reserved
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    of 2

    La Bugal-B’laan Tribal Association v.

    Ramos

    FACTS:
    On 3 March 1995 Pres. Fidel Ramos approved RA No. 7942 which defines the modes and
    agreements for mining operations. Its implementing Rules and Regulation were embodied in
    DENR administrative Order (DAO) No. 96-40, s. 1996 issued on 20 December 1996 by the
    Secretary of DENR Victor O. Ramos.

    On 10 January 1995, President Ramos entered into a financial and technical assistance
    agreement (FTA) with Western Mining Corporations Philippines, Inc. covering 99 hectares land
    in South Cotabato, Sultan Kudarat, Davao del Sur and North Cotabato.

    On 10 January 1997, counsels of Petitioner, LA Bugal-B’laan Tribal Association, sent a letter to


    the DENR secretary demanding to stop the implementation of RA 7942 and DAO No. 96-40.
    Subsequently they filed before the Supreme Court for a prohibition and mandamus with a
    prayer for a temporary restraining order.
    The petitioner alleged that;
    RA 7942 was unconstitutional, because it allowed fully foreign-owned corporation to
    explore, exploit and develop mineral resources that was contrary to Section 2, par. 4 of
    Article XII of the Constitution.
    DENR DAO 96-40 was unconstitutional; because it allowed the taking of private
    property without a determination of public use and just compensation.
    The FTAA between the President and WMCP was unconstitutional.

    Subsequently, WMCP filed before the SC a Manifestation alleging that on 23 January 2001,
    WMC had sold all its shares to Sagitarius Mines, Inc., a corporation which owned by Filipinos
    and about 40 % of it was owned by Indophil Resources NL, an Australian Company.
    On 27 January 2004 the Supreme Court ruled that the following provision of RA 7942 were
    unconstitutional: (a) The proviso in Section 3 (aq), (b) Section 23, (c) Section 33 to 41,
    (d) Section 56, (e) The second and third paragraphs of Section 81, and (f) Section 90.
    (2) All provisions of Department of Environment and Natural Resources Administrative Order
    96-40, s. 1996 which are not in conformity with this Decision, and
    (3) The Financial and Technical Assistance Agreement between the Government of the Republic
    of the Philippines and WMC Philippines, Inc.

    The respondents then filed Motion for Reconsideration.

    ISSUES:
    1. Whether or not the issue is a constitutional issue?
    2. Whether or not the Philippine Mining Act is unconstitutional for allowing foreign-owned
    corporation to exploit the Philippine mineral resources?
    3. What is the proper interpretation of the phrase “Agreement involving either Ethical or
    Financial Assistance” contained in par. 4, sec 2, Article XII of the Constitution?
    RULINGS:
    1. In view of the mootness of the case, the petition should be dismissed but the Court
    ruled it was evident that strong reasons of public policy demanded the constitutionality
    issue be resolve then (Gonzales v. COMELEC)
    2. The Supreme Court upheld the constitutionality of the Philippine Mining Law (RA No.
    7942) , its implementing rules and regulations – insofar as they relate to financial and
    technical agreements as well as the subject Financial and Technical Assistance
    Agreement. Full control is not anathematic to day-to-day management by the contractor,
    provided that the State retains the power to direct overall strategy; and to set aside,
    reverse or modify plans and actions of the contractor. The idea of full control is similar to
    that which is exercised by the board of directors of a private corporation, the
    performance of managerial, operational, financial, marketing and other functions may
    be delegated to subordinate officers or given to contractual entities, but the board
    retains full residual control of the business.

    One of the Section that was upheld by the court constitutional was Sec 3 of RA7942
    which was on the original decision was unconstitutional. The section allows a foreign
    contractor to apply for and hold an exploration permit. The court ruled that The permit
    would merely grant to a qualified person the right to conduct exploration of all minerals
    in specified areas. It would not amount to an authorization to extract the mineral
    resources discovered.

    4. The court ruled that the phrase “Agreement involving either Ethical or Financial
    Assistance” contained in par. 4, sec 2, Article XII of the Constitution does not indicate the
    intent to exclude other modes of assistance from foreign corporations. Involving means
    the possibility of the inclusion of other forms of assistance or activities having to do,
    related to, or compatible with financial and technical assistance.

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