SC: Gov’t can take over oil sector during emergencies

The Supreme Court on Monday ruled it is constitutional for the government to temporarily take over operations of the country’s oil industry during national emergencies declared by the President.

The SC en banc issued the decision citing Section 14(e) of Republic Act 8479, the Downstream Oil Industry Deregulation Act of 1998.

“In times of national emergency, when the public interest so requires, the DoE (Department of Energy) may, during the emergency and under reasonable terms prescribed by it, temporarily take over or direct the operation of any person or entity engaged in the industry,” the provision reads.

The SC reversed the 2013 ruling of the Court of Appeals, which declared Section 14 (e) unconstitutional.

Court records showed that in September and October 2009, typhoons “Ondoy” and “Pepeng” ravaged Luzon, where more than nine million people were affected, with over 1,000 casualties, 700 injured, and 84 missing.

Then-President Gloria Macapagal-Arroyo declared a state of calamity under Proclamation 1898, issued on 2 October 2009. Thereafter, Arroyo issued Executive Order 839, directing oil industry firms to maintain oil prices during the emergency.

Pilipinas Shell and Petroleum Corporation filed a petition before the Regional Trial Court claiming that Executive Order 839 and Section 14(e) of RA 8479 were unreasonable, oppressive, and invalid delegations of emergency powers to the Executive.

On 13 November 2009, the RTC issued a TRO on EO 839. It then issued a decision that granted Pilipinas Shell’s petition and declared Section 14(e) of RA 8479 void. On 25 June 2013, the CA affirmed the RTC’s decision.