Facts

Respondent Gozo bought a house and lot located inside the United States Naval Reservation in
Olongapo, a territory leased to the US by the Military Bases Agreement. She demolished the house and
built another without securing a building permit from the Mayor. Gozo was charged of violation of
Municipal Ordinance No. 14. Gozo avers the municipal govt has no jurisdiction over the leased territory.
In other words, it is asserted that the Phil. Govt does not exercise sovereignty over the American base.

Issues

Does the Philippine government exercise sovereignty over the American base?

Held

Yes. Under the Principle of Auto-limitation, any state may, by its consent, express or implied, submit to a
restriction of its sovereign rights. This capacity for legal self-determination and self-restriction is an
exclusive prerogative of the State. A state then, if it chooses to, may refrain from the exercise of what
otherwise is illimitable competence, a curtailment of what otherwise is a power plenary in character. It
may allow another power to participate in the exercise of jurisdictional right over certain portions of
the territory, but they are still subject to its authority. Such areas do not become impressed with alien
character. It retains their native status. Its jurisdiction is diminished but it does not disappear. Hence, in
this case, “by the Agreement, the Philippine Govt merely consents that the US exercise jurisdiction in
certain cases. The Philippine Government has not abdicated its sovereignty over the bases as part of the
Philippine territory or divested itself completely of jurisdiction over offenses committed therein. Under
the terms of the treaty, the United States Government has prior preferential but not exclusive
jurisdiction of such offenses xxx “Sovereignty is not abrogated (and thus the allegiance thereto is not
transferred) during belligerent occupation. Thus, the law on treason is still in effect during such times.