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Albano vs. Reyes: MICT Franchise Ruling

The case discusses a petition seeking to restrain the Philippine Ports Authority and Secretary of Transportation from awarding a contract for the development and operation of the Manila International Container Terminal to International Container Terminal Services. The court held that while the terminal is a public utility, its operation does not require a franchise from Congress as administrative agencies like the PPA have the power to authorize public utilities by contract.

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31 views1 page

Albano vs. Reyes: MICT Franchise Ruling

The case discusses a petition seeking to restrain the Philippine Ports Authority and Secretary of Transportation from awarding a contract for the development and operation of the Manila International Container Terminal to International Container Terminal Services. The court held that while the terminal is a public utility, its operation does not require a franchise from Congress as administrative agencies like the PPA have the power to authorize public utilities by contract.

Uploaded by

bemjamison
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd

Albano vs.

Reyes
GR No. 83551

Nature:
This is a Petition for Prohibition with prayer for Preliminary Injunction or Restraining Order seeking to restrain the
respondents Philippine Ports Authority (PPA) and the Secretary of the Department of Transportation and
Communications Rainerio O. Reyes from awarding to the International Container Terminal Services, Inc. (ICTSI) the
contract for the development, management and operation of the Manila International Container Terminal (MICT).

Facts:
The Philippine Ports Authority (PPA) board directed the PPA management to prepare for the public bidding of the
development, management and operation of the Manila International Container Terminal (MICT) at the Port of
Manila. A Bidding Committee was formed by the DOTC for the public bidding. After evaluation of several bids, the
Bidding Committee recommended the award of the contract to respondent International Container Terminal Services,
Inc. (ICTSI). Accordingly, Rainerio Reyes, then DOTC secretary, declared the ICTSI consortium as the winning
bidder.

On May 18, 1988, the President of the Philippines approved the same with directives that PPA shall still have the
responsibility for planning, detailed engineering, construction, expansion, rehabilitation and capital dredging of the
port, as well as the determination of how the revenues of the port system shall be allocated for future works; and
the contractor shall not collect taxes and duties except that in the case of wharfage or tonnage dues.
Petitioner Albano, as taxpayer and Congressman, assailed the legality of the award and claimed that since the MICT
is a public utility, it needs a legislative franchise before it can legally operate as a public utility.

Issue:
Whether or not the MICT needs a legislative franchise from Congress to legally operate as a public utility?

Held:
No. While the PPA has been tasked under E.O. No. 30 with the management and operation of the MICT and to
undertake the provision of cargo handling and port related services thereat, the law provides that such shall be “in
accordance with P.D. 857 and other applicable laws and regulations”. P.D. 857 expressly empowers the PPA to
provide services within Port Districts “whether on its own, by contract, or otherwise”.

Even if the MICT is considered a public utility, its operation would not necessarily need a franchise from the
legislature because the law has granted certain administrative agencies the power to grant licenses for or to
authorize the operation of public utilities. Reading E.O. 30 and P.D. 857 together, it is clear that the lawmaker has
empowered the PPA to undertake by itself the operation and management of the MICP or to authorize its operation
and management by another by contract or other means, at its option.

Doctrine:
The law granted certain administrative agencies the power to grant licenses for the operation of public utilities.
Theory that MICT is a “wharf” or a “dock”, as contemplated under the Public Service Act, would not necessarily call
for a franchise from the Legislative Branch.

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