CHAPTER III - C: RULE MAKING POWER
BASIC CONCEPTS
RULE-MAKING POWER
(power of subordinate legislation)
RULES and REGULATIONS
RATIONALE
NECESSITY
NATURE OF GkmuhRANT
3 ISSUES on RULE-MAKING POWER
a. power given to administrative agencies
b. to issue or promulgate rules and regulations 1. PERMISSIBILITY of Whether or not there is: 1. Delegation of Tariff Powers to
c. necessary to carry out its functions DELEGATION a) legislative grant of the Pres.
a. those issued by administrative or executive authority 2. Delegation of Emergency
officers b) to administrative Powers to the President
b. in accordance with and as authorized by law bodies 3. Delegation to the People at
c) to issue rules and Large.
Administrative bodies have:
regulations 4. Delegation to Local
a. competence
Governments.
b. opportunity
5. Delegation to Administrative
a. in order to adapt to the increasing complexity Bodies
b. of modern life and variety of public functions.
a. relaxation of separation of powers; and 2. VALIDITY of Whether or not the grant 1. Statute is complete in all its
b. an exception to non-delegation of legislative DELEGATION meets the: essential terms and conditions
powers. 1) Completeness test when it leaves legislature so
that there will be nothing left
2) Sufficient Standard Test for delegate to do when it
reaches him except to
enforce.
2. Statute fixes a standard,
mapping out the boundaries
of the delegate’s authority by
defining the legislative policy
and indicating the
circumstances under which it
is to be pursued and effected.
3. VALIDITY of Whether or not regulation 1. Not Inconsistent with the
EXERCISE conforms with: Constitution
1) What the statute 2. Not Inconsistent with Statute
provides 3. Cannot Amend Act of Congress
2) Whether the same is 4. Cannot Exceed Provisions of
reasonable Basic Law
5. Uniform, Reasonable, not
Unfair or Discriminatory
 1st ISSUE - PERMISSIBILITY OF DELEGATION
1) Delegation of Tariff Sec. 28(2). Art. VI – Congress may by law authorize the
Powers to the President to fix within specified limits, and subject
to such limitations and restrictions as it may
President
impose, tariff rates. Import and export quotas,
tonnage and wharfage dues, and other duties and
imposts. . .”
Sec. 23(2). Art. VI – In times of war or other national
2) Delegation of
Emergency Powers emergency, Congress may by law authorize the
President for a limited period and subject to such
to the President
restrictions as it may prescribe, to exercise powers
necessary and proper to carry out a declared
national policy. Unless sooner withdrawn by
revolution of the Congress, such powers shall cease
upon the next adjournment thereof.
3) Delegation to the Sec. 2. Art. XVII – Amendments to this Constitution may
People at Large likewise be directly proposed by the people through
initiative upon a petition of at least twelve per
centum of the total number of registered voters. ..
Sec. 3. Art. X – Congress shall enact a local government
4) Delegation to Local
Governments code which shall provide for a more responsive and
accountable local government structure instituted
through a system of decentralization.
5) Delegation to By legislative act – authorizing it to promulgate rules
Administrative and regulations;
Bodies By implication – adopt rules and regulations deemed
necessary to the efficient exercise of the powers
expressly granted.
1st ISSUE – PERMISSIBILITY OF DELEGATION
1. Delegation to By legislative act – authorizing it to promulgate rules and
Administrative regulations;
Bodies By implication –necessary to the efficient exercise of the powers
expressly granted.
PASEI v. TORRES
212 SCRA 298
FACTS:
DOLE Sec. Ruben Torres – as a result of published stories regarding abuses suffered by
Filipino housemaids in Hong Kong issued Department Order no. 16 temporarily
suspending recruitment by private employment agencies of “Filipino domestic helpers
going to Hong Kong.”
Philippine Association of Services Exporters, Inc. (PASEI) – filed for prohibition on the
grounds that: 1) respondents acted in excess of their rule-making authority; 2) Circulars
are contrary to Constitution, are unreasonable, unfair and aggressive.”
HELD:
a) Art. 36 of the Labor Code grants the Labor Secretary the power to restrict and regulate
recruitment and placement activities Department Order No. 16 merely restricted the
scope of petitioner’s business operations by excluding therefrom recruitment and
deployment of domestic helpers for Hong Kong till after the establishment of the
“mechanisms” that will enhance the protection of Filipino domestic helpers going to
Hong Kong.
b) Circulars are a valid exercise of the police power as delegated to the executive branch
of the Government.
 1st ISSUE – PERMISSIBILITY OF DELEGATION
1. Delegation to By legislative act – authorizing it to promulgate rules and
Administrative regulations; Ynot v. IAC (148 SCRA 659) – One searches in vain for the
Bodies By implication – adopt rules and regulations deemed necessary to Illustrative Case usual standard and the reasonable guideline, or better still,
the efficient exercise of the powers expressly granted. the limitations that said officers must observe when they
SANTIAGO v. COMELEC make their distribution. There is none.
270 SCRA 106
FACTS: 2ND ISSUE – VALIDITY OF DELEGATION
COMELEC Resolution No. 2300 – was issued to govern “the conduct of initiative on the
Constitution and Initiative and Referendum and National and Local Laws.” Statute is complete in all its essential terms and conditions when
1. COMPLETENESS
it leaves the legislature so that there will be nothing left for
Sen. Miriam Santiago – argues that COMELEC Resolution 2300 is ultra vires since only TEST
delegate to do when it reaches him except to enforce it.
Congress is authorized by the Constitution to pass the implementing law pursuant to
Art. XVII. Sec. 2(2) which provides thus, “The Congress shall provide for the US v. ANG TANG HO
implementation of this right.” 43 Phil 1
HELD: FACTS:
a) Comelec does not have the power under RA 6735 to promulgate rules and regulations Act No. 2868 (1919) – authorized Governor-General to issue and promulgate rules
to implement the right of the people to directly propose amendments to the “whenever, for any cause, conditions arise resulting in extraordinary rice in price of palay,
Constitution through initiative. rice or corn.”

b) Reliance on Sec. 2(1). Art. IX-C. Constitution is misplaced for the laws and regulations
referred to therein are those promulgated by COMELEC under Sec. 3. Art IX-C and a
law where subordinate legislation is authorized and which satisfies the completeness
and the sufficient standard tests.
2nd ISSUE - VALIDITY OF DELEGATION
1) COMPLETENESS TEST a) Statute is complete in all its essential terms and
conditions when it leaves the legislature;
b) so that there will be nothing left for delegate to do when
it reaches him except to enforce it.
Governor General – pursuant thereto, issued RO 53 fixing the price at which rice should
be sold.
Ang Tang Ho – was charged with the sale price greater than that fixed by EO 53. He was
found guilty as charged and was sentenced to 5 months imprisonment plus P500.00 fine.
He appealed the sentence countering that there is an undue delegation of power to the
Governor General.
HELD:
a) Promulgation of rules is left to the discretion of the Governor General. Legislature did
not define under what conditions the rules may be issued.
b) Legislature does not define what constitutes extraordinary increase in price of cereals.
Neither did it specify or define the conditions upon which the proclamation should
be issued.

US v. Ang Tang Ho (43 Phil 1) – Legislature did not specify

under what conditions the rules may be issued and did not
Illustrative Case define what constitutes extraordinary increase in price of
cereals. Promulgation of rules is left to sole discretion of
Governor General. Law is thus incomplete as a legislation.

a) statute fixes a standard, mapping out the boundaries of

the delegate’s authority;
2) SUFFICIENT STANDARD
TEST b) by defining the legislative policy and indicating the
circumstances under which it is to be pursued and
effected.
 3rd ISSUE – VALIDITY OF EXERCISE
Constitutional DAR v. SUTTON. G.R. No. 162070. Oct.
provisions control 19, 2005
what rules and DAR has no power to regulate livestock
1. Not inconsistent
regulations may be farms which have been exempted by the
with Constitution
promulgated by Constitution from the coverage of
administrative agrarian reform
bodies.
SOL. GEN. v. MMA, 204 SCRA 837

Statutory provisions PD 1605 (granting MMC powers related

control what rules to traffic management and control in
2. Not inconsistent and regulations may Metro Manila) does not allow either
with Statute be promulgated by removal of license plates or confiscation
administrative of driver’s license for traffic violations.
2ND ISSUE – VALIDITY OF DELEGATION bodies. MMA Ordinance imposes sanctions PD
Statute fixes a standard, mapping out boundaries of delegate’s 1605 does not allow and actually
2. SUFFICIENT prohibits.
authority by defining the legislative policy and indicating the
STANDARD TEST
circumstances under which it is to be pursued and effected BOIE-Takeda v. DE LA SERNA, 228 SCRA
329
YNOT v. IAC May not amend,
alter, modify, In including commissions in the
148 SCRA 659
supplant, enlarge or computation of 13th month pay, DOLE
FACTS: 3. Cannot Amend
expand, restrict or unduly expanded the concept of “basic
E.O. 626-A – prohibits inter-provincial transportation of carabaos, and provides further that Act of Congress
limit the provisions salary” as defined in PD 851.
such “carabao transported in violation thereof shall be subject to confiscation and
or coverage of the Implementing rules cannot add or detract
forfeiture by the government, and that the confiscated property shall be distributed to
statute. from the provisions of the law it is
deserving farmers through dispersal as the Director of Animal Industry may see fit.”
designed to implement. They cannot
Restituto Ynot – on January 13, 1984, transported 6 carabaos from Masbate to Iloilo in a widen its scope.
pump boat. His carabaos were confiscated by the police for violation of E.O. 626-A.
UNITED BFHA v. BF HOMES, 310 SCRA
Ynot – filed suit for recovery with RTC-Iloilo, which sustained the confiscation. On appeal, They must be within 304
IAC, upheld RTC. Thus Ynot went to SC contending that E.O. 626-A is unconstitutional. the scope and
4. Cannot Exceed There was a clear attempt to unduly
purview of the
HELD: Provisions of expand the provisions of PD 902-A. The
statutory authority
a) The phrase “may see fit” is an extremely generous and dangerous condition, if Basic Law inclusion of the phrase “GENERAL PUBLIC
granted by
condition it is. It is laden with perilous opportunities for partiality and abuse, even legislature. OR OTHER ENTITY” is a matter which
corruption. One searches in vain for usual standard and the reasonable guideline, or HIGC cannot legally do.
better still, the limitations that said officers must observe when they make their LUPANGCO v. CA, 160 SCRA 848
distribution. There is none. Their options are apparently boundless.
They must not act PRC has no authority to dictate on the
b) There is an invalid delegation of legislative powers to the officers mentioned therein 5. Not reviewees as to how they should prepare
arbitrarily and
who are granted unlimited discretion in the distribution of the properties arbitrarily Unreasonable, themselves for the licensure
capriciously in
taken. Unfair or examinations. It is inconceivable how PRC
promulgating rules
Discriminatory can manage to have watchful eye on each
and regulations
and every examinee during the three
days.
*NOTE* According to the slide of Atty. Soriano, the doctrine under Lupangco v. CA is the same
as the doctrine under Sol Gen v. MMA. I replaced the doctrine on this slide with the
proper doctrines enunciated from the succeeding slides.
3rd ISSUE – VALIDITY OF EXERCISE
1. Not Inconsistent Constitutional provisions control what rules and regulations may
with Constitution be promulgated by administrative bodies.
DAR v. SUTTON
G.R. No. 162070, Oct. 19, 2005
FACTS:
The Suttons (Delia, Ella, Harry) – in 1987, made voluntary offer to sell (VOS) to DAR their
landholdings.
Luz Farms v. Sec. of DAR – in 1990, SC ruled that lands devoted to livestock and poultry-
raising are not included in the definition of agricultural land. Thus, the Suttons filed
request to withdraw their VOS as their landholding was devoted exclusively to cattle-
raising.
DAR Administrative Order No. 9– issued Dec. 27, 1993, provided that only portions of
private agricultural lands used for the raising of livestock, poultry and swine as of June
15, 1988 shall be excluded from the coverage of the CARL.
HELD:
a) A.O. No. 9 is invalid as it contravenes the Constitution. A.O. sought to regulate livestock
farms by including them in the coverage of agrarian reform and prescribing maximum
retention limit for their ownership.
b) DAR has no power to regulate livestock farms which have been exempted by the
Constitution from the coverage of agrarian reform. It has exceeded its power in
issuing the assailed A.O.
3rd ISSUE – VALIDITY OF EXERCISE
2. Not Inconsistent Statutory provisions control what rules and regulations may be
with Statute promulgated by administrative bodies.
SOL. GEN. v. MMA
204 SCRA 837
FACTS:
MTC v. Gonong, G.R. No. 91023, July 13, 1990 – SC held that confiscation of license plates
for traffic violations was not among the sanctions that MMC could impose under PD
1605. Even if confiscation of driver’s licenses was not prescribed nor was allowed to be
imposed by MMC.
Motorists – complained to the Court, on various dates (1990-1991), on the confiscation of
their driver’s licenses and removal of license plate numbers of their vehicles.
MMA – contended that since the Gonong decision said that confiscation of license plates
was invalid in the absence of valid law or ordinance, MMA Ordinance No. 11 was issued,
authorizing itself “to detach license plate of motor vehicles.. obstructing flow of traffic in
Metro Manila.”
Solicitor General – viewed said Ordinance as invalid exercise of delegated legislative power.
HELD:
a) PD 1605 (granting MMC powers related to traffic management and control in Metro
Manila) does not allow either removal of license plates or confiscation of driver’s
license for traffic violations. MMA Ordinance imposes sanctions PD 1605 does not
allow and actually prohibits.
b) In so doing, ordinances disregard and violate and in effect partially repeal the law.
 3rd ISSUE – VALIDITY OF EXERCISE
3. Cannot Amend May not amend, alter, modify, supplant, enlarge or expand, restrict
Act of Congress or limit the provisions or coverage of the statute.
BOIE-Takeda v. DE LA SERNA
228 SCRA 329
FACTS:
PD 851 – required all employers to pay all their employees receiving basic salary of not more
than P1,000.00 a month 13th month pay.
DOLE Implementing Guidelines – included “commissions” in the computation of 13th month
pay.
BOIE-Takeda Chemicals – did not include commission of its medical representatives in the
computation of their 13th month pay. Thus, it was ordered by DOLE to pay the
differential. BOIE-Takeda argues that PD 851 and its implementing rules speak of BASIC
salary and therefore exclude all other remunerations which are not part of the BASIC
salary.
HELD:
a) In including commissions in the computation of 13th month pay, DOLE unduly expanded
the concept of “basic salary” as defined in PD 851. Implementing rules cannot add or
detract from the provisions of the law it is designed to implement. They cannot widen
its scope.
b) Implementing rules cannot add or detract from the provisions of the law it is designed
to implement. They cannot widen its scope. Administrative agency cannot amend an
act of Congress.
3rd ISSUE – VALIDITY OF EXERCISE
4. Cannot Exceed They must be within the scope and purview of the statutory
Provisions of Basic authority granted by the legislature.
Law
UBFHAI v. BF HOMES
310 SCRA 304
FACTS:
PD 902-A – vested Home Insurance Guarantee Corp (HIGC) with jurisdiction over
homeowner’s disputes controversies arising “between such association and the state,
insofar as it concerns their individual franchise or right to exist as such entity.
HIGC’s Revised Rules of Procedure – the phrase “general public or other entity” was added.
HELD:
a) HIGC went beyond the authority provided by the law when it promulgated the revised
rules of procedure. There was a clear attempt to unduly expand the provisions of PD
902-A.
b) The inclusion of the phrase “GENERAL PUBLIC OR OTHER ENTITY” is a matter which
HIGC cannot legally do. The rule –making power of a public administrative body is a
delegated legislative power, which it may not use to abridge the authority given to it
by Congress or the Constitution or to enlarge its power beyond the scope intended.
 3rd ISSUE – VALIDITY OF EXERCISE
5. Not Unreasonable, Administrative bodies must not act arbitrarily and capriciously
Unfair or in the promulgation of rules and regulations
Discriminatory
LUPANGCO v. CA
160 SCRA 848
FACTS:
PRC Resolution No. 105 – prohibits examinee from attending any review class or receiving
any hand-out or review material 3 days before examination day, and provides sanctions
for its violation. One is caught committing the prohibited act is barred from taking
future examinations.
Lupo Lupangco et. al. – reviewees for the licensure examinations in accountancy filed with
the RTC-Manila, an injunction against PRC and to declare the same unconstitutional.
RTC declared the Resolution as unconstitutional. PRC appealed to CA, which reversed
the decision of the RTC. Hence, petition to SC.
HELD:
a) PRC Resolution No. 105 is not only unreasonable and arbitrary, it also infringes on the
examinees’ right to liberty guaranteed by the Constitution.
b) PRC has no authority to dictate on the reviewees as to how they should prepare
themselves for the licensure examinations. It is inconceivable how PRC can manage to
have watchful eye on each and every examinee during the three days.
PRINCIPLE of NON-DELEGATION of POWERS
RULE: potestas delegate non delegari potest
RULE
BASIS: Delegated Power = (Right + Duty) – Further Delegation = Negation
KMU v. GARCIA
239 SCRA 386
FACTS:
LTFRB Circular – authorized provincial bus operators to increase or decrease prescribed fare
without first having filed petition for the purpose and without the benefit of public hearing.
Provincial Bus Operators Association of the Phil. (BOAP) – pursuant thereto, announced 20%
fare increase.
KMU – opposed the move. However, LTFRB dismissed the petition. KMU went to SC assailing
the constitutionality said Circular on the ground that it violates Sec. 16(C) of Public Service
Act (CA 146), which tasks LTFRB with the duty to fix and determine just and reasonable
fares.
HELD:
a) Legislature delegated to the defunct PSC the power of fixing rates of public services.
LTFRB (regulatory body today), is likewise vested with the same under EO 202.
b) Nowhere under said law is LTFRB authorized to delegate that power to transport
operators. The authority given by LTFRB to provincial bus operators to set fare range
is tantamount to an undue delegation of legislative authority. Potestas delegate non
delegari potest.
 RULES and REGULATIONS WITH PENAL SANCTIONS
THREE Requisites for Validity:
1. That law that authorizes the promulgation of rules and regulations must
itself provide for the imposition of a penalty for their violations; (“their”
means the IRR)
Note: This is the most important requirement (e.g. Sec. 7 of RA 3018)

***This 4th requisite in the book is actually included in #1 – Atty Soriano.

The violation for which the rules and regulations impose a penalty must be
punishable and made a crime under the law itself; and

2. It must fix and define such penalty;

Note: e.g. same provision and law as above

3. The rules and regulations must be published in the Official Gazette.

Note: Art. 3 of the Civil Code, which provides that “Ignorance of the law excuses no
one from compliance therewith”, WOULD ONLY APPLY IF Art. 2 of said Code is
complied with that is the PUBLICATION of the law.