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PRESIDENTIAL DECREE NO. 900
PRESIDENTIAL DECREE NO. 900 -
CREATING THE PHILIPPINE NATIONAL LINES, DEFINING ITS POWERS AND
FUNCTIONS, APPROPRIATING FUNDS THEREFOR AND FOR OTHER PURPOSES
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WHEREAS, it
is the policy of the government to dispose of its shares in the
Philippine National Lines, to the private sector at a propitious time;chanroblesvirtualawlibrary
WHEREAS, the government, cognizant of the vital role that shipping
plays in the economic growth of the country, has given various
incentives to Philippine shipping companies for the accelerated
expansion and modernization of their fleet; chanroblesvirtualawlibrary
WHEREAS, despite these incentives given to the industry, private
shipping companies have failed to expand and modernize their fleet due
to the heavy capital requirement involved;chanroblesvirtualawlibrary
WHEREAS, statistics show that in 1974, the Philippine overseas fleet
carried only a measly 7.8% of the country's foreign trade which
accounted for a drain of some 600 million dollars representing freight
payments to foreign flag carriers;chanroblesvirtualawlibrary
WHEREAS, the situation is expected to get worse in the years to come
unless the government will take an active part by way of pioneering the
operation of a national line that will augment but not complete with
the fleet requirement of the Philippine international trade;chanroblesvirtualawlibrary
WHEREAS, such government involvement and initiative shall further the
national objective and policy of developing national self-reliance,
best serve the interest of national security, and facilitate the
performance of other essential governmental functions;chanroblesvirtualawlibrary
WHEREAS, a well developed shipping industry shall serve to meet the
market demands and service requirements of neighboring countries in
Southeast Asia.
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of
the Philippines, by virtue of the powers vested in me by the
Constitution, do hereby order and decree the following:cralaw:red
Section 1. Creation of the PNL. — There is hereby
created a body corporate and politic to be known as the Philippine
National Lines, hereinafter referred to as PNL, which shall be governed
by this Decree and its by-laws as authorized hereunder and shall have
succession for a period of fifty (50) years from and after the date of
approval of this Decree. The principal office of the PNL shall be
located in a place to be determined by the Board of
Directors. chanroblesvirtualawlibrary
Section 2. Purpose of the PNL. — The PNL, by itself
or through its subsidiary/subsidiaries, shall undertake all manner of
business activity for the establishment of a reliable shipping services
that shall include but not be limited to:cralaw:red
a. The ownership, lease, charter, management and
operation of merchant vessels, whether for cargo or passengers on a
scheduled, non-scheduled or charter basis on domestic and/or
international scale;chanroblesvirtualawlibrary
b. Ship brokerage and other related or supportive
activities;chanroblesvirtualawlibrary
c. The ownership, establishment, management and
operation of shipbuilding and ship repair facilities in order to
provide adequate services to the shipping industry.
Section 3. Powers of the PNL. — In order to
accomplish the foregoing corporate purpose, the PNL shall be vested
with the following powers:cralaw:red
a. To prescribe, and thereafter to amend and repeal,
its by-laws not inconsistent with this Decree;chanroblesvirtualawlibrary
b. To adopt and use a seal and alter it when
necessary;chanroblesvirtualawlibrary
c. To sue and be sued in any court;chanroblesvirtualawlibrary
d. To carry on any other lawful business whatsoever
in pursuance of, or in connection with, the foregoing corporate
purpose;chanroblesvirtualawlibrary
e. To enter into, make, perform and carry out
contracts of every kind and description for the foregoing corporate
purpose with any person, firm or association or corporation, domestic
or foreign; chanroblesvirtualawlibrary
f. To have one or more offices in and outside of the
Philippines, and to conduct its business and exercise its powers
throughout and in any part of the Republic of the Philippines and/or in
any or all foreign countries, states and territories;chanroblesvirtualawlibrary
g. To acquire, hold, mortgage and alienate personal
and real property in the Philippines or elsewhere;chanroblesvirtualawlibrary
h. To purchase, hold, alienate, mortgage, pledge or
otherwise dispose of the shares of the capital stock of, or any bond,
security of, other corporations or associations of this or any other
country, and while the owner of said stock, to exercise all the rights
of ownership including the right to vote thereon;chanroblesvirtualawlibrary
i. To borrow funds from any source, private or
government, foreign or domestic;chanroblesvirtualawlibrary
j. To invest, own or otherwise participate in equity
in any establishment, firm or entity engaged in the industry; to form,
organize, invest in, establish and maintain subsidiary or subsidiaries;chanroblesvirtualawlibrary
k. To exercise such powers and perform such acts as
may be necessary to carry out the purpose for which the PNL was
established or which from time to time may be declared by the Board of
Directors to be necessary, useful, incidental or auxiliary to
accomplish such purpose.
Section 4. Capital Stock Appropriation. — The PNL
shall have a capital stock divided into FIVE MILLION no-par shares to
be subscribed, paid for, and voted on, as follows: chanroblesvirtualawlibrary
a. Two million shares of stock shall be subscribed
and paid for the Government of the Republic of the Philippines. Such
shares shall have an initial value of Forty Pesos (P40.00) per share
and may be redeemed by the PNL and resold to the National Government at
reissue value to be determined by the Board of Directors and approved
by the President of the Philippines.
For this purpose, the amount of EIGHTY MILLION PESOS out of the General
Fund, not otherwise appropriated, is hereby appropriated for the
payment of the two million shares subscribed by the Republic of the
Philippines.
b. One million shares of stock shall be subscribed
and paid for by the National Development Company at issue value to be
determined by the Board of Directors of the PNL.
c. Subject to the approval of the President of the
Republic of the Philippines, the remaining two million shares shall be
subscribed to by the Government of the Republic of the Philippines or
any of its national financial institutions or government-owned or
controlled corporations or the private sector to the extent of up to
twenty-five (25%) per centum of the capital stock at issue values to be
determined by the Board of Directors of the PNL.
d. Twenty-five per centum of the value of all stock
subscribed under paragraphs (b) and (c), this section, shall be paid
for at the time of subscription, and the balance thereof shall be
subject to call upon a majority vote of the Board of Directors.
e. The voting power pertaining to shares of stock
subscribed by the Government of the Republic of the Philippines shall
be vested in the President of the Philippines or in such persons as he
may designate.
f. The voting power pertaining to shares of stock
subscribed by the National Development Company shall be vested in the
Chairman of the Board of Directors.
g. The voting power pertaining to shares of stock
hereinafter subscribed by or transferred to national financial
institutions or government-owned or controlled corporations or to the
private sector shall be vested in the Chairman of their respective
Board of Directors/Trustees, or in the absence of the Board of
Directors/Trustees, in their respective chief executive official.
h. Each share of stock shall represent one vote.
Issuances or transfers of shares be allowed only upon offer of such
shares for subscription or purchase having first been made to the
Government of the Republic of the Philippines. Any agreement, contract,
arrangement, scheme or plan that shall transfer ownership and voting
rights over such shares that the majority control by the National
Government over the total number of voting shares of the PNL shall be
impaired is prohibited.
Section 5. Authority for Fund Appropriation. — In
addition to the appropriation of funds authorized under Section 4,
paragraph (a), there are hereby set aside and appropriated from the
General Fund, not otherwise appropriated, such amounts as may be
necessary to pay for (1) the total reissue value of shares of stock
whenever the same are resold by the PNL to the National Government
under Section 4, paragraph (a), (2) any subscription of the National
Government under Section 4, paragraph (c), and (3) any subscription of
the National Government to the capital stock of subsidiaries of the
PNL.
Section 6. Board of Directors. — The PNL shall be
governed by a Board of Directors consisting of nine (9) members duly
elected as hereinafter provided for terms of three (3) years who shall
be paid per diem of Two Hundred Fifty Pesos for each session: Provided,
That the first members and chairman shall be appointed by the President
of the Philippines and shall serve for a term of one year or until
their successors shall have been elected as hereinafter provided. In
case of any vacancy in the Board the same shall be filled by the
President of the Philippines for the unexpired term. chanroblesvirtualawlibrary
Annually on the first Tuesday in March, the stockholders shall meet to
elect the members of the Board whose terms have expired, each
stockholder or proxy to be entitled to as many votes as he may have
shares of stocks. Immediately after the election, the directorate shall
be organized as such and elect from amongst themselves a chairman.
Provided, that no person shall be elected director unless he is a
natural born citizen of the Philippines, not less than thirty-five
years of age, of established integrity and has attained proficiency,
expertise and recognized competence in one or more of the following:
shipping, finance, economics, law business management, public utility
or government administration.
Section 7. Functions and Duties of the Board of
Directors. — The general functions and duties of the Board of Directors
shall be as follows:cralaw:red
a. To prescribe and amend the by-laws of the PNL;chanroblesvirtualawlibrary
b. To appoint and fix the salaries of such executive
officers and other officials and employees as may be necessary for the
management and internal administration of the PNL, except that the
appointing power may be delegated by the Board to the Management of the
PNL;chanroblesvirtualawlibrary
c. To act as initial incorporators of any subsidiary
formed by the PNL;chanroblesvirtualawlibrary
d. To establish such number of Division and/or
Departments in the PNL as may be necessary for the accomplishment of
the corporate purpose;chanroblesvirtualawlibrary
e. To constitute appropriate standing committees that
it may deem necessary to effectively carry out its governing powers
over the affairs and activities of the PNL;chanroblesvirtualawlibrary
f. To submit to the President of the Philippines and
to publish an annual report of the condition of the PNL on or before
the 1st of March of each year;chanroblesvirtualawlibrary
g. To perform such other functions and duties as may
be necessary to accomplish the purpose of the PNL or to carry out its
powers under this Decree and the by-laws prescribed thereunder.
Section 8. Auditor. — The Commissioner on Audit shall
appoint, subject to the approval of the Board, a representative who
shall be the Auditor of the PNL and such personnel as may be necessary
to assist said representative in the performance of his duties. The
salaries of the Auditor and his staff shall be approved by the Board.
The Auditor of corporations owned or controlled by the PNL shall be
appointed by their respective Board of Directors.
Section 9. Foreign Loans. — The PNL, through its
President or duly authorized representative, upon approval by the Board
of Directors, is hereby authorized to contract loans, credits in any
convertible foreign currency or capital goods, and indebtedness from
time to time from foreign governments, or any international financial
institution or fund sources, on such terms and conditions as it shall
deem appropriate for the accomplishment of its purpose and to enter
into and execute agreements and other documents specifying such terms
and conditions.
Further, the President of the Philippines, by himself or through his
duly authorized representative, is hereby authorized to negotiate and
contract with foreign governments or any international financial
institutions or fund sources, in the name and in behalf of the PNL, one
or several loans, for the accomplishment of its purposes. chanroblesvirtualawlibrary
The President of the Philippines, by himself or through his duly
authorized representative, is hereby further authorized to guarantee,
absolutely and unconditionally, as primary obligor and not as surety in
the name and in behalf of the Republic of the Philippines pursuant to
loan agreements entered into with foreign governments or any
international institutions or fund sources. chanroblesvirtualawlibrary
Section 10. Transfer of Ownership and/or Operation to
the Private Sector. — The provisions of this Decree and the by-laws as
authorized to be adopted thereunder notwithstanding, the Board of
Directors may, subject to approval by the President of the Philippines,
transfer to private ownership and/or operation the PNL and any or all
its subsidiaries when it shall appear that undue competition is being
posed by the PNL to private shipping companies.
Section 11. Transitory Provisions. — The Chairman of
the Board shall, within thirty (30) days from the date of his
appointment, call for an organizational meeting of the Board in order
that corporate business may immediately be commenced.
Pending the appointment of the necessary executive officers and
personnel of the PNL, the Board shall be assisted by a technical staff
to be designated by the Maritime Administrator from the MARINA and
other government agencies. To defray the initial costs of operation
therefor, there is hereby appropriated the amount of ONE MILLION PESOS
(P1,000,000.00) for immediate release chargeable against the initial
fund appropriation of the National Government as provided in Section 4,
paragraph (a) hereof.
Section 12. Separability Clause. — Should any
provision of this Decree be held unconstitutional, no other provision
hereof shall be affected thereby.
Section 13. Repealing Clause. — All laws, decrees,
executive orders, administrative orders, rules and regulations
inconsistent herewith are hereby repealed, amended or modified
accordingly.
Section 14. Effectivity. — This Decree shall take
effect upon its approval.
Done in the City of Manila,
this 4th day of March, in the year of Our Lord, nineteen hundred and
seventy-six.
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