286 SCRA 109 – Political Law – Free Enterprise

The Philippine Coconut Authority (PCA) was created by Presidential Decree No. 232 as an
independent public corporation to promote the rapid integrated development and growth of
the coconut and other palm oil industry in all its aspects and to ensure that coconut farmers
become direct participants in, and beneficiaries of, such development and growth through a
regulatory scheme set up by law.
PCA is also in charge of the issuing of licenses to would-be coconut plant operators. In March
1993, however, PCA issued Board Resolution No. 018-93 which no longer require those
wishing to engage in coconut processing to apply for licenses as a condition for engaging in
such business. The purpose of which is to promote free enterprise unhampered by protective
regulations and unnecessary bureaucratic red tapes. But this caused cut-throat competition
among operators specifically in congested areas, underselling, smuggling, and the decline of
coconut-based commodities. The Association of Philippine Coconut Desiccators (APCD)
then filed a petition for mandamus to compel PCA to revoke B.R. No. 018-93.
ISSUE: Whether or not the petition should be granted.
HELD: Yes. Our Constitutions, beginning with the 1935 document, have repudiated laissez-
faire as an economic principle. Although the present Constitution enshrines free enterprise
as a policy, it nonetheless reserves to the government the power to intervene whenever
necessary to promote the general welfare. As such, free enterprise does not call for the
removal of “protective regulations” for the benefit of the general public. This is so because
under Art. 12, Secs. 6 and 9, it is very clear that the government reserves the power to
intervene whenever necessary to promote the general welfare and when the public interest
so requires.