Equal Protection

TIU VS. CA
CONRADO L. TIU, JUAN T. MONTELIBANO JR. and ISAGANI M.
JUNGCO, petitioners,
vs.
COURT OF APPEALS, HON. TEOFISTO T. GUINGONA JR.,
BASES CONVERSION AND DEVELOPMENT AUTHORITY, SUBIC
BAY METROPOLITAN AUTHORITY, BUREAU OF INTERNAL
REVENUE, CITY TREASURER OF OLONGAPO and MUNICIPAL
TREASURER OF SUBIC, ZAMBALES, respondents.
G.R. No. 127410
January 20, 1999
Ponente: PANGANIBAN, J.

Nature of Case:
A petition for review under Rule 45 of the Rules of Court.
BRIEF
A petition for review to reverse the decision of the Court of Appeals
which upheld the constitutionality and validity of the E.O. 97-A.
FACTS
On March 13, 1992, Congress, with the approval of the President,
passed into law RA 7227. This was for the conversion of former
military bases into industrial and commercial uses. Subic was one
of these areas. It was made into a special economic zone.
In the zone, there were no exchange controls. Such were
liberalized. There was also tax incentives and duty free importation
policies under this law.
On June 10, 1993, then President Fidel V. Ramos issued Executive
Order No. 97 (EO 97), clarifying the application of the tax and duty
incentives. It said that:
On Import Taxes and Duties. Tax and duty-free
importations shall apply only to raw materials, capital
goods and
equipment
brought
in
by business
enterprises into the SSEZ

On All Other Taxes. In lieu of all local and national taxes

(except import taxes and duties), all business enterprises in
the SSEZ shall be required to pay the tax specified in
Section 12(c) of R.A. No. 7227.
Nine days after, on June 19, 1993, the President issued Executive
Order No. 97-A (EO 97-A), specifying the area within which the taxand-duty-free privilege was operative.
Section 1.1.
The Secured Area consisting of the presently
fenced-in former Subic Naval Base shall be the only
completely tax and duty-free area in the SSEFPZ. Business
enterprises and individuals (Filipinos and foreigners)
residing within the Secured Area are free to import raw
materials, capital goods, equipment, and consumer items
tax and duty-free.
Petitioners challenged the constitutionality of EO 97-A for allegedly
being violative of their right to equal protection of the laws. This
was due to the limitation of tax incentives to Subic and not to the
entire area of Olongapo. The case was referred to the Court of
Appeals.
The appellate court concluded that such being the case, petitioners
could not claim that EO 97-A is unconstitutional, while at the same
time maintaining the validity of RA 7227.
The court also explained that the intention of Congress was to
confine the coverage of the SSEZ to the "secured area" and not to
include the "entire Olongapo City and other areas mentioned in
Section 12 of the law.
ISSUE of the CASE
Whether the provisions of Executive Order No. 97-A confining the
application of R.A. 7227 within the secured area and excluding the
residents of the zone outside of the secured area is discriminatory
or not owing to a violation of the equal protection clause.
COURT RATIONALE ON THE ABOVE FACTS
The fundamental right of equal protection of the laws is not
absolute, but is subject to reasonable classification. If the groupings
are characterized by substantial distinctions that make real
differences, one class may be treated and regulated differently
from another. The classification must also be germane to the

purpose of the law and must apply to all those belonging to the
same class.
Classification, to be valid, must (1) rest on substantial distinctions,
(2) be germane to the purpose of the law, (3) not be limited to
existing conditions only, and (4) apply equally to all members of
the same class.
RA 7227 aims primarily to accelerate the conversion of
military reservations into productive uses. This was really limited to
the military bases as the law's intent provides. Moreover, the law
tasked
the
BCDA
to
specifically
develop
the
areas
thebases occupied.
Among such enticements are: (1) a separate customs territory
within the zone, (2) tax-and-duty-free importations, (3) restructured
income tax rates on business enterprises within the zone, (4) no
foreign exchange control, (5) liberalized regulations on banking and
finance, and (6) the grant of resident status to certain investors and
of working visas to certain foreign executives and workers. The
target of the law was the big investor who can pour in capital.
Even more important, at this time the business activities outside
the "secured area" are not likely to have any impact in achieving
the purpose of the law, which is to turn the former military base to
productive use for the benefit of the Philippine economy. Hence,
there was no reasonable basis to extend the tax incentives in RA
7227.
It is well-settled that the equal-protection guarantee does
not require territorial uniformity of laws. As long as there
are actual and material differences between territories,
there is no violation of the constitutional clause.
Besides, the businessmen outside the zone can always channel
their capital into it.
RA 7227, the objective is to establish a "self-sustaining, industrial,
commercial, financial and investment center. There will really be
differences between it and the outside zone of Olongapo.
The classification of the law also applies equally to the residents
and businesses in the zone. They are similarly treated to contribute
to the end gaol of the law.
SUPREME COURT RULING:

WHEREFORE, the petition is DENIED for lack of merit. The assailed

Decision and Resolution are hereby AFFIRMED. Costs against
petitioners.

3. Resolution issued by the Sandiganbayan denying petitioner's

Motion to Strike Out and/or Review Result of Reinvestigation
conducted by the Office of the Ombudsman.
FACTS
Paraaque Mayor Pablo Olivarez refused to issue a mayors permit
in favor of Baclaran Credit Cooperative Inc. (BCCI) to operate a
night fair along the service road of Roxas Boulevard (Baclaran) for
60 days in accordance with Paraaque Sangguniang Bayan
Resolution No. 744. Instead Olivarez issued and signed an
Executive Order granting an unknown or unidentified group of
Baclaran-based irganizations/associations of vendors the privilege
to operate a night fair in Baclaran, causing undue injury to BCCI.
Equal Protection
OLIVAREZ VS SANDIGANBAYAN
MAYOR PABLO R. OLIVAREZ, petitioner,
vs.
HON. SANDIGANBAYAN (Second Division) and the HON.
OMBUDSMAN, Special Prosecutor ANIANO DESIERTO and Deputy
Special Prosecutor JOSE DE G. FERRER, respondents.
G.R. No. 118533
October 4, 1995
Ponente: Regalado
Nature of Case:
Petition for Certiorari and Prohibition
BRIEF
Petitioner Mayor Pablo R. Olivarez seeks to annul the following:
1. Resolution issued by Special Prosecutor (SP) Aniano Desierto
and approved by Ombudsman Conrado M. Vasquez
reversing Special Prosecution Officer (SPO) I Cornelio
Somido's recommendation to dismiss the case against
petitioner;
2. Resolution issued by Deputy Special Prosecutor (DSP) Jose De
G. Ferrer and approved by Ombudsman Conrado Vasquez
reversing SPO III Angel Mayoralgo's recommendation to
withdraw the case against petitioner for insufficiency of
evidence; and

BCCI charged Paraaque Mayor Pablo Olivarez with Violation of the

Anti-Graft and Corrupt Practices Act. Allegedly, BCCI exerted all
possible efforts to secure the necessary permit but Olivarez simply
refused to issue the same unless it gives money to him.
ISSUE of the CASE
Whether there was manifest partiality exhibited by Olivarez in
denying / inaction over BCCIs application for mayors permit
ACTIONS of the COURT
Ombudsman: directed prosecution o proceed under existing
information
Sandiganbayan: denied Olivarez Omnibus Motion for lack of
merit and proceeded to arraign him
SC: dismissed petition.
COURT RATIONALE ON THE ABOVE FACTS
Petitioner's suspected partiality may be gleaned from the fact that
he issued a permit in favor of the unidentified Baclaran-based
vendors' associations by the mere expedient of an executive order,
whereas so many requirements were imposed on BCCI before it
could be granted the same permit. Worse, petitioner failed to show,
in apparent disregard of BCCI's right to equal protection, that BCCI
and the unidentified Baclaran-based vendors' associations were not
similarly situated as to give at least a semblance of legality to the
apparent haste with which said executive order was issued. It would
seem that if there was any interest served by such executive order,
it was that of Olivarez.
BCCI wrote Olivarez requesting for permit to operate but was
rejected outright by him on the theory that the application should
be made with the proper municipal official. As the mayor of the
municipality, the officials referred to were definitely under his
authority and he was not without recourse to take appropriate

action on the letter-application of BCCI although it was not strictly

in accordance with normal procedure. There was nothing to prevent
him from referring said letter-application to the licensing
department, but which paradoxically he refused to do. A municipal
mayor is expressly authorized and has the power to issue permits
and licenses for the holding of activities for any charitable or
welfare purpose. He cannot really feign total lack of authority to act
on the letter-application of BCCI.
There is enough evidence to warrant the filing of a formal charge in
court against herein petitioner for a violation of Section 3(e) of
Republic Act No. 3019: Causing any undue injury to any party,
including the Government, or giving any private party any
unwarranted benefits, advantage or preference in the discharge of
his official administrative or judicial functions through manifest
partiality, evident bad faith or gross inexcusable negligence. This
provision shall apply to officers and employees of offices or
government corporations charged with the grant of licenses or
permits or other concessions.

and/or preliminary injunction to prevent the enforcement of the

total ban on motorcycles along the entire breadth of North and
South Luzon Expressways and the Manila-Cavite (Coastal Road) Toll
Expressway under DO 215. On January 10, 2001, petitioners filed
before the trial court a Petition for Declaratory Judgment with
Application for Temporary Restraining Order and Injunction to
nullity of the following administrative issuances for being
inconsistent with the provisions of Republic Act 2000, entitled
"Limited Access Highway Act" enacted in 1957: (a) DPWH
Administrative Order No. 1, Series of 1968; (b) DPWH Department
Order No. 74, Series of 1993; and (c) Art. II, Sec. 3 (a) of the
Revised Rules on Limited Access Facilities promulgated in 1998 by
the DPWH thru the Toll Regulatory Board (TRB).
ISSUE:
Whether the Administrative Order No. 1 introduces an unreasonable
classification by singling-out motorcycles from other motorized
modes of transport and violates the right to travel.

SUPREME COURT RULING:

WHEREFORE, the petition is DISMISSED for lack of merit.
Equal Protection: Substantial Distinctions

G.R. No. 158793. June 8, 2006

James
Mirasol,
Richard
Santiago,
Motorcyclists Federation,Inc., petitioners,

RULING:
and

Luzon

vs. Department of Public Works and Highways and Toll

RegulatoryBoard, respondents

FACTS:
On 19 February 1968, Secretary Antonio V. Raquiza of the
Department of Public Works and Communications issued AO 1,
which, among others, prohibited motorcycles on limited access
highways. Accordingly, petitioners filed an Amended Petition on
February 8, 2001 wherein petitioners sought the declaration of
nullity of the aforesaid administrative issuances. Moreover,
petitioners prayed for the issuance of a temporary restraining order

No. Petitioners are not being deprived of their right to use the
limited access facility. They are merely being required, just like the
rest of the public, to adhere to the rules on how to use the facility.
AO 1 does not infringe upon petitioners right to travel but merely
bars motorcycles, bicycles, tricycles, pedicabs, and any nonmotorized vehicles as the mode of traveling along limited
access
highways. There
exists
real
and
substantial
differences exist between a motorcycle and other forms of
transport sufficient to justify its classification among those
prohibited from plying the toll ways. A classification based on
practical
convenience
and
common
knowledge
is
not
unconstitutional simply because it may lack purely theoretical or
scientific uniformity.
We find that it is neither warranted nor reasonable for petitioners to
say that the only justifiable classification among modes of transport

is the motorized against the non-motorized. Not all motorized

vehicles are created equal. A 16-wheeler truck is substantially
different from other light vehicles. The first may be denied access
to some roads where the latter are free to drive. Old vehicles may
be reasonably differentiated from newer models. We find that real
and substantial differences exist between a motorcycle and other
forms of transport sufficient to justify its classification among those
prohibited from plying the toll ways. Amongst all types of motorized
transport, it is obvious, even to a child, that a motorcycle is quite
different from a car, a bus or a truck. The most obvious and
troubling difference would be that a two-wheeled vehicle is less
stable and more easily overturned than a four-wheeled vehicle.

1. Section 5 of Executive Order No. 80, dated April 3, 1993,

regarding the CSEZ.
2. Executive Order No. 97-A, dated June 19, 1993,
pertaining to the SSEZ.
3. Section 4 of BCDA Board Resolution No. 93-05-034,
[2]
dated May 18, 1993, pertaining to the CSEZ.
Facts:
On March 13, 1992, Republic Act No. 7227 was enacted, providing
for, among other things, the sound and balanced conversion of the
Clark and Subic military reservations and their extensions into
alternative productive uses in the form of special economic zones in
order to promote the economic and social development of Central
Luzon in particular and the country in general.
On April 3, 1993, President Fidel V. Ramos issued Executive Order
No. 80, which declared, among others, that Clark shall have all the
applicable incentives granted to the Subic Special Economic and
Free Port Zone under Republic Act No. 7227.
Pursuant to the directive under Executive Order No. 80, the BCDA
passed Board Resolution No. 93-05-034 on May 18, 1993, allowing
the tax and duty-free sale at retail of consumer goods
imported via Clark for consumption outside the CSEZ.

Equal Protection Clause

COCONUT FARMERS ASSOCIATION vs TORRES
GR No. 132527, July 29, 2005

On June 10, 1993, the President issued Executive Order No. 97,
Clarifying the Tax and Duty Free Incentive Within the Subic Special
Economic Zone Pursuant to R.A. No. 7227. Nine days after, on June
19, 1993, Executive Order No. 97-A was issued, Further Clarifying
the Tax and Duty-Free Privilege Within the Subic Special Economic
and Free Port Zone.

AZCUNA, J
Nature: Petition for Prohibition and Injunction for the Executive
Branch from allowing, and the private respondents from continuing
with, the operation of tax and duty-free shops located at the Subic
Special Economic Zone (SSEZ) and the Clark Special Economic
Zone (CSEZ) and to declare the following issuances as
unconstitutional, illegal, and void:

Issues:
1.WON the assailed issuances constitute executive legislation?
2.WON the assailed issuances violate equal protection clause?
3.WON the assailed issuances violate constitutional prohibition
against unfair competition and practices in restraint of trade?

4. WON it violates the State policy of promoting the preferential use

of Filipino labor, domestic materials and locally produced goods?
Applying the foregoing test to the present case, this
Court finds no violation of the right to equal protection of
the laws.

Held:
1. No. Section 12 (b) of Republic Act No. 7227 mentions only
raw materials, capital and equipment, but this does not
necessarily mean that the tax and duty-free buying privilege
is limited to these types of articles to the exclusion of
consumer goods. The phrase tax and duty-free importations
of raw materials, capital and equipment was merely cited as
an example of incentives that may be given to entities
operating within the zone. To limit the tax-free importation
privilege of enterprises located inside the special economic
zone only to raw materials, capital and equipment clearly
runs counter to the intention of the Legislature to create a
free port where the free flow of goods or capital within, into,
and out of the zones is insured.
On the other hand, insofar as the CSEZ is concerned,
the case for an invalid exercise of executive legislation is
tenable. While Section 12 of Republic Act No. 7227 expressly
provides for the grant of incentives to the SSEZ, it fails to
make any similar grant in favor of other economic zones,
including the CSEZ. Tax and duty-free incentives being in the
nature of tax exemptions, the basis thereof should be
categorically and unmistakably expressed from the
language of the statute. Consequently, in the absence of
any express grant of tax and duty-free privileges to the
CSEZ in Republic Act No. 7227, there would be no legal basis
to uphold the questioned portions of two issuances: Section
5 of Executive Order No. 80 and Section 4 of BCDA Board
Resolution No. 93-05-034, which both pertain to the CSEZ.
2. No. Petitioner asserts that private respondents operating
inside the SSEZ are not different from the retail
establishments located outside, the products sold being
essentially the same.
It is an established principle of constitutional law that the
guaranty of the equal protection of the laws is not violated
by a legislation based on a reasonable classification.
Classification, to be valid, must (1) rest on substantial
distinction, (2) be germane to the purpose of the law, (3) not
be limited to existing conditions only, and (4) apply equally
to all members of the same class.

First, contrary
to
petitioners
claim,
substantial
distinctions lie between the establishments inside and
outside the zone, justifying the difference in their treatment.
As long as there are actual and material differences
between territories, there is no violation of the constitutional
clause. And of course, anyone, including the petitioners,
possessing the requisite investment capital can always avail
of the same benefits by channeling his or her resources or
business operations into the fenced-off free port zone.
Second, the classification is germane to the purpose of
Republic Act No. 7227. As held in Tiu, the real concern of
Republic Act No. 7227 is to convert the lands formerly
occupied by the US military bases into economic or
industrial areas. . In furtherance of such objective, Congress
deemed it necessary to extend economic incentives to the
establishments within the zone to attract and encourage
foreign and local investors.
Third, The classification, moreover, is not limited to the
existing conditions when the law was promulgated, but to
future conditions as well, inasmuch as the law envisioned
the former military reservation to ultimately develop into a
self-sustaining investment center.
And, lastly, the classification applies equally to all
retailers found within the secured area. As ruled in Tiu, the
individuals and businesses within the secured area, being in
like circumstances or contributing directly to the
achievement of the end purpose of the law, are not
categorized further. They are all similarly treated, both in
privileges granted and in obligations required.
3. No. Republic Act No. 7227, and consequently Executive
Order No. 97-A, cannot be said to be distinctively arbitrary
against the welfare of businesses outside the zones. The

mere fact that incentives and privileges are granted to

certain enterprises to the exclusion of others does not
render the issuance unconstitutional for espousing unfair
competition.

WHEREFORE, the petition is PARTLY GRANTED. Section 5 of

Executive Order No. 80 and Section 4 of BCDA Board Resolution No.
93-05-034 are hereby declared NULL and VOID and are accordingly
declared of no legal force and effect. Respondents are hereby
enjoined from implementing the aforesaid void provisions. All

portions of Executive Order No. 97-A are valid and effective, except
the second sentences in paragraphs 1.2 and 1.3 of said Executive
Order, which are hereby declared INVALID.