Commissioner of Customs vs Eastern Sea Trading

Consti Case
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  Republic of the Philippines SUPREME COURT ManilaEN BANC G.R. No. L-14279 October 31, 1961THE COMMISSIONER O CUSTOMS ! # THE COLLECTOR O CUSTOMS,  petitioners, vs. E$STERN SE$ TR$%ING,  respondent. Office of the Solicitor General for petitioners. Valentin Gutierrez for respondent. CONCEPCION, J.: Petition for review of a judgent of the Court of !a Appeals reversing a decision of the Coissioner of Custos.Respondent Eastern #ea !rading was the co &'( ee o) &e*er!+ &'e t& o) o 'o ! # (!r+'c  which arrived at the Port of Manila fro August $% to #epteber &, '(%). #oe shipents cae fro *apan and others fro +ong ong. -n as uch as none of the shipents had the certificate reuired b/ Central Ban0 Circulars Nos. )) and )% for the release thereof, the goods thus iported /ere &e'0e# ! # &becte# to )or)e'tre rocee#' (& )or !++e(e# *'o+!t'o & o) &ect'o 1363) o) te Re*'&e# $#' '&tr!t'*e Co#e,  in relation to the aforeentioned circulars of the Central Ban0. -n due course, the Collector of Custos of Manila rendered a decision on #epteber ), '(%1, declaring said goods forfeited to the 2overnent and 3 the goods having been, in the eantie, released to the consignees on suret/ bonds, filed b/ the sae, as principal, and the Alto #uret/ 4 -nsurance Co., -nc., as suret/, in copliance with orders of the Court of 5irst -nstance of Manila, in Civil Cases Nos. $6()$ and $67%$ thereof 3 directing that the aounts of said bonds be paid, b/ said principal and suret/, jointl/ and severall/, to the Bureau of Custos, within thirt/ 869: da/s fro notice.;n appeal ta0en b/ the consignee, said decision was affired b/ the Coissioner of Custos on <eceber $&, '(%1. #ubseuentl/, the consignee sought a review of the decision of said two 8$: officers b/ the Court of !a Appeals, which reversed the decision of the Coissioner of Custos and ordered that the aforeentioned bonds be cancelled and withdrawn. +ence, the present petitionof the Coissioner of Custos for review of the decision of the Court of !a Appeals.!he latter is based upon the following preises, nael/= that the Central Ban0 has no authorit/ to regulate transactions not involving foreign e change> that the shipents in uestion are in the natureof ?no@dollar? iports> that, as such, the aforeentioned shipents do not involve foreign e change> that, insofar as a Central Ban0 license and a certificate authoriing the iportation or release of the goods under consideration are reuired b/ Central Ban0 Circulars Nos. )) and )%, the latter are null and void> and that the seiure and forfeiture of the goods iported fro *apan cannot be justified under E ecutive ;rder No. 6$7, '  not onl/ because the sae see0s to ipleent an e ecutive agreeent $  3 e tending the effectivit/ of our  6  !rades and 5inancial Agreeents )  with *apan 3 which 8e ecutive agreeent:, it believed, is of dubious validit/, but, also, because there is no governental agenc/ authoried to issue the iport license reuired b/ the aforeentioned e ecutive order.  !he authorit/ of the Central Ban0 to regulate no@dollar iports and the validit/ of the aforeentionedCirculars Nos. )), and )% have alread/ been passed upon and repeatedl/ upheld b/ this Court 8Pascual vs. Coissioner of Custos, @'9(&( *une 69, '(%(D> Acting Coissioner of Custos vs. euterio, @(')$ ;ctober '&, '(%(D Coissioner of Custos vs. Pascual, @(761 Noveber '7, '(%(D> Coissioner of Custos vs. #erree -nvestent Co., @'$99& Ma/ '1, '(19D> Coissioner of Custos vs. #erree -nvestent Co., @')$&) Noveber $(, '(19D:, for the reasonthat the broad powers of the Central Ban0, under its charter, to aintain our onetar/ stabilit/ and topreserve the international value of our currenc/, under section $ of Republic Act No. $1%, in relation to section ') of said Act 3 authoriing the ban0 to issue such rules and regulations as it a/ consider necessar/ for the effective discharge of the responsibilities and the e ercise of the powers assigned to the Monetar/ Board and to the Central Ban0 3 connote the authorit/ to regulate no@dollar iports, owing to the influence and effect that the sae a/ and do have upon the stabilit/ of our peso and its international value.!he Court of !a Appeals entertained doubts on the legalit/ of the e ecutive agreeent sought to beipleented b/ E ecutive ;rder No. 6$7, owing to the fact that or Se !te !# ot co crre# ' te !5' ( o) &!'# eect'*e !(reee t.  !he concurrence of said +ouse of Congress is reuired b/ our fundaental law in the a0ing of ?treaties? 8Constitution of the Philippines, Article --, #ection'9&D:, which are, however, distinct and different fro ?e ecutive agreeents,? which a/ be validl/ entered into without such concurrence.!reaties are foral docuents which reuire ratification with the approval of two thirds of the#enate. E ecutive agreeents becoe b' #' ( tro( eect'*e !ct'o /'tot te ee# o) ! *ote b te Se !te or b Co (re&&. . . . the right of the E ecutive to enter into binding agreeents without the necessit/ of subseuent Congressional approval has been confirmed by long usage . 5ro the earliest da/s of our histor/ we have entered into e ecutive agreeents covering such subjects as coercial and consular relations, ost@favored@nation rights, patent rights, tradear0 and cop/right protection, postal and navigation arrangeents and the settleent of clais. The validity of these has never been seriously questioned by our courts .  Agreeents with respect to the registration of trade@ar0s have been concluded b/ the E ecutive with various countries under the Act of Congress of March 6, '77' 8$' #tat. %9$:. Postal conventions regulating the reciprocal treatent of ail atters, one/ orders, parcel post, etc., have been concluded b/ the Postaster 2eneral with various countries under authoriation b/ Congress beginning with the Act of 5ebruar/ $9, '&($ 8' #tat. $6$, $6(:. !en e ecutive agreeents were concluded b/ the President pursuant to the Mcinle/ !ariff  Act of '7(9 8$1 #tat. %1&, 1'$:, and nine such agreeents were entered into under the <ingle/ !ariff Act '7(& 869 #tat. '%', $96, $'):. A ver/ uch larger nuber of agreeents, along the lines of the one with Ruania previousl/ referred to, providing for ost@favored@nation treatent in custos and related atters have been entered into since the passage of the !ariff Act of '($$, not b/ direction of the Act but in haron/ with it. -nternational agreeents involving political issues or changes of national polic/ and those involving international arrangeents of a peranent character usuall/ ta0e the for of  treaties. But international agreeents ebod/ing adjustments of detail carr/ing out well@established national policies and traditions and those involving arrangeents of a ore or less teporar/ nature usuall/ ta0e the for of e ecutive agreeents. 5urtherore, the Fnited #tates #upree Court has e pressl/ recognied the validit/ and constitutionalit/ of e ecutive agreeents entered into without #enate approval. 86( Colubiaaw Review, pp. &%6@&%): 8#ee, also, F.#. vs. Curtis@Gright E port Corporation, $(( F.#. 69), 7' . ed. $%%> F.#. vs. Belont, 69' F.#. 6$), 7' . ed. ''6)> F.#. vs. Pin0, 6'% F.#. $96, 71 . ed. &(1> ;anic vs. F.#., '77 5. $d. $77> Hale aw *ournal, ol. '%, pp. '(9%@'(91> California aw Review, ol. $%, pp. 1&9@1&%> +/de on -nternational aw Revised EditionD, ol. $, pp. ')9%, ')'1@')'7> Gilloughb/ on the F.#. Constitutional aw, ol. - $d ed.D, pp. %6&@%)9> Moore, -nternational aw <igest, ol. , pp. $'9@$'7> +ac0worth, -nternational aw <igest, ol. , pp. 6(9@)9&:. 8Ephasis supplied.:-n this connection, 5rancis B. #a/re, forer F.#. +igh Coissioner to the Philippines, said in his wor0 on ?!he Constitutionalit/ of !rade Agreeent Acts?= Agreeents concluded b/ the President which fall short of treaties are coonl/ referred to as eect'*e !(reee t&  and are no less coon in our schee of governent than are the ore foral instruents 3 treaties and conventions. !he/ soeties ta0e the for of e changes of notes and at other ties that of ore foral docuents denoinated ?agreeents? tie or ?protocols?. !he point where ordinar/ correspondence between this and other governents ends and agreeents 3 whether denoinated e ecutive agreeents or e changes of notes or otherwise 3 begin, a/ soeties be difficult of read/ ascertainent. -t would be useless to underta0e to discuss here the large variet/ of e ecutive agreeents as such, concluded fro tie to tie. +undreds of e ecutive agreeents, other than those entered into under the trade@agreeents act, have been negotiated with foreign governents. . . . -t would see to be sufficient, in order to show that the trade agreeents under the act of '(6) are not anoalous in character, that the/ are nottreaties, and that the/ have abundant precedent in our histor/, to refer to certain classes of agreeents heretofore entered into b/ the E ecutive without the approval of the #enate. !he/ cover such subjects as the inspection of vessels, navigation dues, incoe ta on shipping profits, the adission of civil aircraft, custos atters, and coercial relations generall/, international clais, postal atters, the registration of tradear0s and cop/rights, etcetera. #oe of the were concluded not b/ specific congressional authoriation but in conforit/ with policies declared in acts of Congress with respect to the general subject atter, such as tariff acts> while still others, particularl/ those with respect of the settleent of clais against foreign governents, were concluded independentl/ of an/ legislation.? 86(Colubia aw Review, pp. 1%', &%%.:!he validit/ of the e ecutive agreeent in uestion is thus patent. -n fact, the so@called Parit/ Rights provided for in the ;rdinance Appended to our Constitution were, prior thereto, the subject of an e ecutive agreeent, ade without the concurrence of two@thirds 8$I6: of the #enate of the Fnited #tates.astl/, the lower court held that it would be unreasonable to reuire fro respondent@appellee an iport license when the -port Control Coission was no longer in e istence and, hence, there was, said court believed, no agenc/ authoried to issue the aforeentioned license. !his conclusion is untenable, for the authorit/ to issue the aforeentioned licenses was not vested e clusivel/ upon the -port Control Coission or Adinistration. E ecutive ;rder No. 6$7 provided for e port or  iport licenses ?fro the entral !an of the #hilippines or the -port Control Adinistration? or Coission. -ndeed, the latter was created onl/ to perfor the tas0 of ipleenting certain objectives of the Monetar/ Board and the Central Ban0, which otherwise had to be underta en by these two $%& agencies . Fpon the abolition of said Coission, the dut/ to provide eans and wa/s for the accoplishent of said objectives had erel/ to be discharged directl/ b/ the Monetar/ Board and the Central Ban0, even if the aforeentioned E ecutive ;rder had been silent thereon.G+ERE5;RE, the decision appealed fro is hereb/ reversed and another one shall be entered affiring that of the Coissioner of Custos, with cost against respondents defendant@appellee, Eastern #ea !rading. -t is so ordered. !engzon' .(.' #adilla' !autista )ngelo' *abrador' +eyes' (.!.*.' #aredes' ,izon and ,e *eon' ((.'  concur. !arrera' (.'  too0 no part. oot ote& '  <ated *une $$, '(%9. -t provides, inter alia , that fro and after said date, no coodit/ a/ be e ported to or iported fro ;ccupied *apan without an e port or iport license fro the Central Ban0 of the Philippines or the -port Control Adinistration, and that the annual e ports and iports to the Philippines and fro ;ccupied *apan, as contained in the !rade Plan shall be allocated and the licenses therefor shall be issued onl/ to bona fide Philippine e porters and iporters, subject to the provisions of section ( of said E ecutive ;rder and to such rules and regulations as a/ be prescribed b/ the -port Control  Adinistration and the Central Ban0 of the Philippines. $  According to a counication dated April $), '(%& of the then Acting #ecretar/ of 5oreign  Affairs 8E hibit 5:, *apan was subrogated into the rights, obligations and interests of the #CAP and *apan on March '(, '(%$, and since then the agreeents have been e tended mutatis mutandis '7 ties, the current one to e pire at the end of April, '(%&. 6  !he !rade Agreeent, dated Ma/ '7, '(%9, provides, inter alia , for the adoption of a trade plan, on an annual basis, between the Philippines and ;ccupied *apan> that, subject to e ceptions, all trade shall be conducted in accordance with the 5inancial Agreeent between the two countries, and through specified channels> that subject to e change, iport and e port control restrictions, both countries would perit the iportation fro and e portation to each other of the coodities specified in the trade plan, within specified liits> that consultations would be held for necessar/ odifications of the trade plan> that a achiner/ would be established to ensure accurate and up@to@date inforation regarding theoperation of the agreeent and to insure the ipleentation of the trade plan> and that the parties would do ever/thing feasible to ensure copliance with the e port@iport control, e change control and such other controls pertaining to international trade as a/ be in force in their respective territories fro tie to tie. !he agreeent, li0ewise, specifies the ethodof revision or cancellation thereof, the procedure for the review of the trading position between the parties and the tie of its effectivit/ 8upon ?e change of foral ratification?, pending which, ?it shall ta0e effect upon signature b/ authoried representatives as modus vivendi between the parties?:.


Jul 23, 2017
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