Perez v LPG Refillers

Perez v LPG Refillers (2006) Quisumbing, J. FACTS:  BP Blg. 33 was enacted to penalize illegal trading, hoarding, overpricing, adulteration, underdelivery, and underfilling of petroleum products, as well as possession for trade of adulterated petroleum products and of underfilled liquefied petroleum gas (LPG) cylinders.  The law sets a minimum of P20,000 and a maximum of P50,000 as penalties.  The Department of Energy issued Circular No. 2000-06-010 to implement the law.  Respondent LPG Refillers Association of the Philippines asked the DOE to set aside the Circular for being contrary to law but to no avail, hence they filed an action before the RTC to nullify the circular.  RTC granted the petition and nullified the Circular on the ground that it introduced new offenses not included in the statute. o Moreover, in providing penalties on a per cylinder basis for each violation, there is a possibility that the P50,000 maximum penalty might be exceeded. o The Circular has a range of P1,000-5,000/cylinder for first offenses and a range of P5,000-10k/cylinder for third offenses. For retails outlets, the max penalty is 20k. o Aside from the monetary fines, some offenses also include the recommendation the closure of the business to the proper LGU.  Meanwhile, petitioner Sec. Perez of the DOE argues that DOE is empowered by the ff. provisions to penalize the acts it enumerated in the circular: o

BP Blg. 33, as amended: “SEC. 3-A. Rules and Regulations; Administrative sanctions for violation thereof. – The Bureau of Energy Utilization shall issue such rules and regulations as are necessary to carry into effect the provisions of this Act, subject to the approval of the Minister of Energy, after consultation with the affected industry sectors. Said rules and regulations shall take effect fifteen (15) days from the date of its publication in two (2) newspapers of general circulation. “The Bureau of Energy Utilization is empowered to impose in an administrative proceeding, after due notice and hearing, upon any person who violates any provision of such rules and regulations, a fine of not more than ten thousand pesos (P10,000.00) or to suspend or remove the license or permit of a hauler, marketer, refiller, dealer, sub-dealer or retail outlet: Provided, That hearing in any administrative proceedings may be waived by respondent. Provided, Further, That during the pendency of such administrative proceeding, the Bureau may suspend the business operations of such hauler, marketer, refiller, dealer, subdealer or retailer or retail outlet operator when the suspension is consistent with public interest. … xxxx “The administrative sanction that may be imposed shall be without prejudice to the filing of a criminal action as the case may warrant.”

o

§23 of RA 8479 (Downstream Oil Industry Deregulation Act of 1998): Section 23. Implementing Rules and Regulations. – The DOE, in coordination with the Board, the DENR, DFA, Department of Labor and Employment (DOLE), Department of Health (DOH), DOF, DTI, National Economic and Development Authority (NEDA) and TLRC, shall formulate and issue the necessary implementing rules and regulations within sixty (60) days after the effectivity of this Act.

o

§5(g) and §21 of RA 7638 (Department of Energy Act of 1992): (g) Formulate and implement programs, including a system of providing incentives and penalties, for the judicious and efficient use of energy in all energy-consuming sectors of the economy; xxx Subject to existing rules and regulations, the funds and monies collected or which the otherwise come into the possession of the Department and its bureaus from fees, surcharges, fines, and penalties which the Department and its bureaus may impose and collect under this Act

ISSUES + RULING: WoN the Circular is valid/legal. YES.  For an administrative regulation, to have the force of penal law, the following must concur: o the violation of the administrative regulation must be made a crime by the delegating statute itself; and o the penalty for such violation must be provided by the statute itself  As for the first requirement:

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BP Blg 33 only states merely lists the various modes by which the said criminal acts may be perpetrated, namely: no price display board, no weighing scale, no tare weight or incorrect tare weight markings, no authorized LPG seal, no trade name, unbranded LPG cylinders, no serial number, no distinguishing color, no embossed identifying markings on cylinder, underfilling LPG cylinders, tampering LPG cylinders, and unauthorized decanting of LPG cylinders. o The acts and omissions stated in the circular are well within the modes contemplated by the law and serve the purpose of curbing pernicious practices of LPG dealers. As for the second requirement: o The statute provides a minimum and maximum amount as penalties. o The maximum pecuniary penalty for retail outlets is P20,000, an amount within the range allowed by law. While the circular is silent as to the max penalty for refillers, marketers, and dealers, such does not amount to violation of the statutory maximum limit. o The mere fact that the Circular provides penalties on a per cylinder basis does not in itself run counter to the law since all that B.P. Blg. 33 prescribes are the minimum and the maximum limits of penalties. The law was intended to provide the DOE with increased administrative and penal measures with which to effectively curtail rampant adulteration and shortselling, as well as other acts involving petroleum products, which are inimical to public interest.

DISPOSITION: Petition granted.