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Tatad vs. Garcia - 243 SCRA 436 (1995)
Tatad vs. Garcia - 243 SCRA 436 (1995)
Ponente Quiason, J
Doctrine/ Relevant
Topic Corporate Nationality: Public Utilities (Sec. 11, Art. XII, Constitution)
Facts DOTC planned to construct a light railway transit line along EDSA
(EDSA LRT III) to provide a mass transit system and alleviate the
congestion and growing transportation problem in the metropolis. RA
6957 was enacted allowing for the financing, construction and operation
of government projects through private initiative and investment.
Accordingly, prequalification and bidding was made and EDSA LRT
Corporation (organized under HK laws) was recommended to be
awarded with the contract. The President approved the awarding of the
contract. Petitioners are senators praying for the prohibition of
respondents from further implementing and enforcing the contract.
Issue/s Whether or not the EDSA LRT III, a public utility, can be owned by a
foreign corporation.
Ruling Yes.
In sum, private respondent will not run the light rail vehicles and collect
fees from the riding public. It will have no dealings with the public and
the public will have no right to demand any services from it. Even the
mere formation of a public utility corporation does not ipso facto
characterize the corporation as one operating a public utility. The
moment for determining the requisite Filipino nationality is when the
entity applies for a franchise, certificate or any other form of
authorization for that purpose.