Oil Regulation

And
Deregulation law

Laurence Alfuerto
FM
7/3/14

Sir.Narciso Isidro Jr

Regulation refers to controlling business through laws passed by the government. To protect the
interests of consumers, government institutes regulatory laws. Conversely, deregulation deals
with the elimination of government laws and rules. These laws, or removal of them, impact
consumer and business activities such as obtaining loans, importing supplies and selling
products. So, understanding the meaning of regulation and deregulation is crucial. Regulation
can be distinguished as economic and social. Economic regulation deals with quality of service,
energy and entry conditions in specific sectors, such as transportation or communications. Social
regulations deal with issues associated with risks to health, safety, and the environment. Some
regulations promote safety and quality standards while others restrict commodity supplies and set
tariffs to control or limit competition. Highly regulated industries include agriculture, food and
fisheries, pharmaceuticals and manufacturing. Regulations help protect consumer interests from
dishonest business practices and promote fair competition.

Deregulation is the lifting of certain government controls (such as price control) on several
aspects of a specific industry, specifically the oil industry.Under the Oil Deregulation Law
(Republic Act No. 8479) enacted by the Tenth Congress in 1998, government does not interfere
with the pricing, export and importation of oil products, nor the establishment of retail outlets
(gasoline stations); storage depots; ocean-receiving facilities; and refineries. People can put up
these installations practically wherever and whenever they want. In the case of retail outlets,
they can even be set up beside or across the street each other. Provided of course the
owners/operators of these installations & facilities notify and give prior notice to the Department
of Energy (DOE). The location of these installations & facilities conform to the zoning laws of
the local government unit concerned.Large business establishments and government corporations
can also import their fuel requirements without securing any permit from the government; they
just have to inform the DOE. They can also choose any local or foreign supplier to provide these
requirements. Should they choose a foreign supplier, they can import their requirements directly
from this foreign supplier. Deregulation and competition encourage oil companies to be more
effective and efficient; they are compelled to improve their service. Under a regulated set-up,
however, domestic oil companies have little reason to strive to meet world class standards. As
an early example of deregulation, the termination of the Interstate Commerce Commission Act
led to a substantial drop in the cost of shipping goods around the country