MALACAÑANG

Manila

PRESIDENTIAL DECREE No. 451 May 11, 1974

AUTHORIZING THE SECRETARY OF EDUCATION AND CULTURE TO REGULATE THE

IMPOSITION OF TUITION AND OTHER SCHOOL FEES, REPEALING REPUBLIC ACT NO. 6139,
AND FOR OTHER PURPOSES

WHEREAS, private schools, colleges and universities have been faced with increasingly serious
problems arising from decreasing incomes due to slump in enrolment and increasing operational
costs brought about by the rise in prices of instructional materials and educational, as well as allied
services;

WHEREAS, it is imperative that private educational institutions upgrade classroom instruction by

improving their facilities and hiring competent teachers in all levels of education, provide salary and
or wage increases and other benefits to their teaching, administrative and other personnel to keep
up with the increasing cost of living;

WHEREAS, the procedure prescribed under R.A. No. 6139 for the increase of tuition and other
school fees has been proved to be too cumbersome and time-consuming, and is not conducive to
the growth and improvement of private educational institutions and the well-being of their
employees, particularly those in the lower income groups and

WHEREAS, in order to alleviate the sad plight of private schools, their personnel and all those
directly and indirectly dependent on school incomes it advisable and necessary that the
cumbersome and time-consuming procedures fixed under Republic Act No. 6139 for increasing
tuition fees be simplified without opening the flood-gates to abuse of the right to increase tuition and
other school fees.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the

powers vested in me by the Constitution do hereby decree and order the following as part of the law
of the land:

Section 1. Authority of Secretary of Education and Culture. Within the limits and under the
circumstances set forth in this Decree, the Secretary of Education and Culture shall have the
authority to regulate the imposition of tuition and other school fees or charges by any and all private
schools as defined under Act Numbered Two thousand seven hundred and six, as amended. No
changes in the rates of tuition or other school fees or charges shall be effective without the prior
approval of the Secretary of Education and Culture. New school fees or charges to be imposed by
new or existing schools, whether for new courses or other matters, shall be at such reasonable rates
as may be determined by the Secretary of Education and culture based on the standard of such
school.

Section 2. Application and Documents Required. Any private school which desires to revise its rates
of tuition or other school fees or charges or to impose other fees or charges shall file application
therefor with the Secretary of Education and Culture. The application shall include:

(a) Statement of the itemized current rates of tuition and other charges and the
corresponding itemized proposed changes thereon, as well as the new fees or charges
proposed to be imposed, and of the proposed allocation of the incremental proceeds in
 accordance with Section 3(a) hereof. Such statements shall, when accomplished be under
oath by the proper official (s) of the school concerned;

(b) Financial statement showing the financial status of the school duly certified by a certified
public accountant;

(c) A copy of the last tax return, where required, filed with the Bureau of Internal Revenue.

Section 3. Limitations. The increase in tuition or other school fees or other charges as well as the
new fees or charges authorized under the next preceding section shall be subject to the following
conditions:

(a) That no increase in tuition or other school fees or charges shall be approved unless sixty
(60%) per centum of the proceeds is allocated for increase in salaries or wages of the
members of the faculty and all other employees of the school concerned, and the balance for
institutional development, student assistance and extension services, and return to
investments: Provided, That in no case shall the return to investments exceed twelve (12%)
per centum of the incremental proceeds; and

(b) That any such increase shall in no case exceed fifteen (15%) per centum of the rates
charged during the preceding school year.

Section 4. Rules and Regulations. The Secretary of Education and Culture is hereby authorized,
empowered and directed to issue the requisite rules and regulations for the effective implementation
of this Decree. He may, in addition to the requirements and limitations provided for under Sections 2
and 3 hereof, impose other requirements and limitations as he may deem proper and reasonable.

Section 5. Prohibitions. No school administration or office or division thereof shall hold or sponsor
any benefit performance, movies, concerts, dramatic presentation, games and/or shows of whatever
kind or nature whether for charity or otherwise. Any such act on the part of the school administration
or office or division thereof shall be considered a circumvention of this law and shall be sufficient
cause for the cancellation of the approval of any previous increase in tuition or other school fees and
shall subject the school official concerned to such disciplinary action as the Secretary of Education
and Culture may deem proper including the revocation on any decree conferred by authority of the
Government.

Section 6. Review of Financial Statements. Financial statements submitted in accordance with the
provisions of Section 2 hereof may be reviewed by the Commission on Audit at the instance of the
Secretary of Education and Culture whenever he believes that the same is necessary for verification
purposes. For this purpose, the Commission on Audit is authorized to examine the pertinent books
and record of the school concerned.

Section 7. Additional Scholarships. As a further condition to any grant of increase in tuition or other
school fees, private schools with a total enrolment of at least one thousand, are hereby required to
provide free scholarships to poor but deserving students at the ratio of one (1) free scholarship for
every five hundred (500) pupils/students enrolled: Provided, That this requirement shall be exclusive
of the present practice of private schools offering scholarship privileges to valedictorians and
salutatorians and other pupils/students who have achieved scholastic distinctions. Neither shall other
forms of scholarships such as those offered to athletes and working students be included in arriving
at the proper number of poor but deserving pupils/students to be given free scholarships.
Section 8. Penal Clause. Any violation of the provisions of this Decree or of the rules or regulations
promulgated pursuant thereto or any final decision made by the Secretary of Education and Culture
shall be punishable by a fine of five thousand (P5,000.00) pesos or imprisonment of two years or
both at the discretion of the court which penalty shall be imposed on the official(s) of the private
school or on any person acting for and in behalf of the school directly responsible for the violation. If
the violator is a public official the same penalty shall be imposed without prejudice to any
administrative action which may be taken against him.

Section 9. Repealing Clause. Republic Act No. 6139 is hereby repealed, and all laws, decrees,
executive orders, directives and rules and regulations inconsistent herewith are likewise repealed,
amended or modified accordingly.

Section 10. Effectivity. This Decree shall take effect immediately.

Done in the City of Manila, this 11th day of May, in the year of Our Lord, nineteen hundred and
seventy-four.

DEC ISSUANCE

IMPLEMENTING RULES AND REGULATIONS FOR PRESIDENTIAL DECREE NO. 451

Pursuant to Section 4 of Presidential Decree No. 451, in relation to Section 1 thereof, the following
implementing rules and regulations are hereby prescribed and promulgated for the guidance of all
concerned:

RULE I
Policy and Scope

Section 1. Scope. The rules and regulations herein prescribed shall apply to all private schools,
colleges and universities duly authorized or recognized by the Government.

Section 2. Authority to Regulate. The Secretary of Education and Culture has the authority to
regulate any increase or change in the rate of tuition and/or other school fees or charges collected
from pupils or students and/or their parents by all private schools, colleges and universities.

Any increase or change including new fees in private schools, colleges, and universities shall not be
effective without the prior approval of the Secretary of Education and Culture.

Section 3. Purpose of Increase. As a general rule, the purpose or purposes for which any increase
or change in the current rates of tuition and/or other school fees or charges of private schools,
colleges and universities shall be to upgrade and update classroom instruction by improving their
facilities and hiring competent teachers in all levels of education, provide salary and/or wage
increase and other benefits to their teaching, administrative and other personnel to keep up with the
increasing cost of living, and to grant student assistance and establish extension services.
Section 4. Effectivity of Increase. Unless otherwise provided, the effectivity of each approval of an
application for increase or change in tuition and/or other school fees or charges, including new fees
or charges, shall be specified and indicated on the action taken by the Secretary of Education and
Culture.

RULE II
Definition of Terms

Section 1. Unless otherwise specifically defined the following terms shall be understood thus

a) Tuition fee covers the school charges for the subjects or course enrolled in by a pupil or
student, as indicated in the respective prospectuses, colleges and universities, which may
either be on a term or yearly basis or per unit or units.

b) Other school fees includes all miscellaneous fees charged to be charged by private
schools, colleges and universities as embodied in their respective prospectuses, bulletins of
information, or catalogues, which are collected and earmarked for certain specified purposes
pursuant to existing laws, rules and regulations.

c) Current school fees means the tuition and other school fees collected or charged by
private schools, colleges and universities as approved, indicated and published in their
respective prospectuses, bulletins of information, or catalogues.

d) Increase in fees means any addition in the amount of the current tuition and/or other
school fees as defined in subsections (a), (b), and (c) herein.

e) New fee or charge means those which are imposed by new schools or by existing schools
which are not included in their public bulletin or catalogue.

RULE III
Application

Section 1. Period of Filing. For the school year 1974-75, each application for increase in tuition
and/or other school fees or charges, including new fees or charges, together with all necessary
supporting documents, shall be filed directly by mail or personal delivery to the Director of Private
Schools in Manila.

Section 2. Contents. The application referred to in the preceding section shall indicate, among
others, (a) the purpose and jurisdiction for the proposed increase in tuition and/or other school fees
or other charges, (b) the itemized current rates of tuition fee or other school charges, (c) the
corresponding proposed percentage increase, (d) the revised rates to be imposed or collected, (e)
the proposed allocation and program of expenses to be effected if the petition is approved, and (f)
the effectivity in point of school year on a term at which time the new rates shall be implemented.

Section 3. Notices. Application for increase in tuition fee and/or other school charges, or for new
fees or charges, shall be announced by the school administration.

Section 4. Oath and Other Requirements. The application shall be signed by the school head, under
oath, and shall include as annexes (a) copy of the financial statement showing the financial status of
the school, college or university, duly certified correct by a licensed Certified Public Accountant; and
(b) copy of the latest tax returns filed by the school, college or university with the Bureau of Internal
Revenue, or in the negative, and lieu of the required tax returns, a corresponding statement relative
thereto by the school head or his duly authorized representative; and (c) a certification by the school
head to the effect that the application for increase has been announced.

RULE IV
Action on Application

Section 1. Delegation of Authority. The Director of Private Schools is hereby authorized to process

and evaluate all applications for increase in tuition fee and/or other charges, including new school
fees or charges, and to submit corresponding recommendations thereon to the Secretary of
Education and Culture for appropriate action.

RULE V
Disposition of Proceeds from Increase

Section 1. Emoluments. At least sixty (60) per cent of the total incremental proceeds from the
increase in tuition fee and/or other school charges shall be applied toward an equitable increase in
the emoluments and/or benefits for members of the faculty, including the staff and administrative
employees of the school, college or university concerned, a maximum of twelve (12%) per cent for
return on investments, and the rest or twenty-eight (28%) per cent for institutional development,
including the emergency allowance called for under LOI No. 174, are deemed embraced in the
emoluments and/or other benefits for members of the faculty and staff.

Section 2. Percentage of Increase. The rate of increase in tuition and/or other school fees or
charges shall in no case exceed fifteen (15%) per centum of the current school fees in the school,
college, or university concerned during the next preceding school year.

Section 3. Scholarships. As a condition precedent for the grant of any increase in tuition and/or
other school fees or charges, each school, college or university is required to provide free
scholarships to poor but deserving pupils or students at the ratio of one (1) free scholarship for every
five hundred (500) pupils/students enrolled: Provided, however, That the free scholarships herein
called for shall be exclusive or in addition to any existing privileges internally granted by private
schools, colleges and universities to class valedictorians, salutatorians, and other pupils/students
who have achieved scholastic distinctions as well as other forms or kinds of scholarships such as
those granted to athletes, working students, and other beneficiaries.

Section 4. Review of Financial Statements. The Secretary of Education and Culture, whenever he

deems fit and necessary for verification purposes, may authorize and/or request a representative of
the Commission on Audit, through its Chairman, to review the financial statements submitted
pursuant to Section 2 of Rule III hereof, and to examine the pertinent books and records of the
school, college or university concerned.

RULE VI
Miscellaneous

Section 1. Prohibitions. No school administration shall sponsor or hold any benefit performances,
movies, concerts, dramatic presentations, games and/or shows of whatever kind or nature whether
for charity or otherwise. Any such act on the part of the school administration shall be considered a
circumvention of Presidential Decree No. 451 and shall accordingly be taken as sufficient cause for
the cancellation of the latest approval of the increase in tuition and/or other school fees or charges of
the school, college or university concerned granted by the Secretary of Education and Culture, if
any, or a valid ground for the denial or disapproval of its application if one is pending consideration.
Section 2. Penal Provision. Pursuant to Section 8 of Presidential Decree No. 451, any violation of
the law or any provisions of these Implementing Rules and Regulations, or any final decision made
by the Secretary of Education and Culture shall be punishable by a fine of Five thousand pesos
(5,000.00) or imprisonment of two (2) years or both at the discretion of the court, which penalty shall
be imposed on the official(s) of the private school or any person acting for and in behalf of the school
directly responsible for the violation. If the violator be a public official the same penalty shall be
imposed without prejudice to any administrative action that may be taken against him.

Section 3. Repealed Clause. All existing rules and regulations inconsistent with the present
Implementing Rules and Regulations are repealed, cancelled, revoked, or modified accordingly.

Section 4. Effectivity. These implementing rules and regulations shall be effective immediately.

Manila Philippines, May 13, 1974.