Manila Prince Hotel

Summary: Sec. 10, second par., Art. XII of the 1987 Constitution is a mandatory. The Manila Prince
Hotel, a Filipino corporation, should be preferred over a Malaysian firm pursuant to the Constitutional
provision on national patrimony.

Facts: The controversy arose when respondent Government Service Insurance System (GSIS) decided to
sell through public bidding 30% to 51% of the issued and outstanding shares of respondent MHC. The
winning bidder, or the eventual strategic partner, is to provide management expertise and/or an
international marketing/reservation system, and financial support to strengthen the profitability and
performance of the Manila Hotel. In a close bidding only two (2) bidders participated: petitioner Manila
Prince Hotel Corporation, a Filipino corporation, and Renong Berhad, a Malaysian firm, which bid for the
same number of shares at P44.00 per share, or P2.42 more than the bid of petitioner.

Pending the declaration of Renong Berhard as the winning bidder and the execution of the necessary
contracts, petitioner matched the bid price of P44.00 per share. Respondent GSIS refused to accept. On
October 1995, petitioner came to the Supreme Court on prohibition and mandamus.

Petitioner invokes Sec. 10, second par., Art. XII, of the 1987 Constitution and submits that the Manila
Hotel has been identified with the Filipino nation and it has become a part of the national patrimony.
Petitioner also argues that the hotel business, being a part of the tourism industry, is unquestionably a
part of the national economy. Since Manila Hotel is part of the national patrimony and its business also
unquestionably part of the national economy, petitioner should be preferred after it has matched the
bid offer of the Malaysian firm. For the bidding rules mandate that if for any reason, the Highest Bidder
cannot be awarded the Block of Shares, GSIS may offer this to the other Qualified Bidders that have
validly submitted bids provided that these Qualified Bidders are willing to match the highest bid in terms
of price per share.

Issue: Whether or not the Manila Prince Hotel should be preferred over the Renong Berhard pursuant to
Sec. 10, Art. XII of the Constitution.