SECTION 1. Section 12 of Presidential Decree No. 1648, as
amended by Presidential Decree No. 1787, is hereby amended to read as
follows:
"SEC. 12. Foreign Loans; Republic
Guarantee.—
The Company is hereby authorized to contract loans; credits, and other
indebtedness from time to time, in any convertible foreign currency or capital
goods, from foreign governments, or any international financial institutions or
fund sources or any other entities, on such terms and conditions it shall deem
appropriate for the accomplishment of its purposes and to enter into and execute
agreements and other documents specifying- such terms and conditions. The loans,
credits and indebtedness contracted by the Company under this paragraph (a) and
all payments, whether of principal, interest, other charges or otherwise, due in
connection therewith, shall be exempt from all direct and indirect taxes,
including withholding taxes on payments of interest, and from all fees, imposts,
other charges and restrictions presently imposed or to be imposed by the
Republic of the Philippines or any of its agencies and political subdivisions.
The payment of all loans, credits and other indebtedness contracted by the
Company pursuant to the preceding paragraph (a) shall be and are hereby fully
and unconditionally guaranteed by the Republic of the Philippines. The
obligations of the Republic of the Philippines as guarantor hereunder shall be
absolute and unconditional, and shall not be contingent or conditioned upon the
pursuit of any right or remedy against the Company or its assets or against any
other person or against any collateral security for or other guarantee of the
obligations of the Company. With respect to such obligations, the Republic of
the Philippines hereby waives for itself and its property immunity from suit,
jurisdiction of any court, legal proceedings, attachment prior to judgment,
attachment in aid of execution, other attachment and execution of judgment, on
the ground of sovereignty. The Minister of finance is hereby directed and
authorized to pay all such loans, credits and other indebtedness, including
interest accrued thereon and all other amounts payable in connection therewith,
in case the Company fails to do so, and there are hereby appropriated, out of
the general funds in the National Treasury, the sums necessary to make the
payments guaranteed by this Decree.
The President of the Philippines, or his duly authorized representative, is
authorized to issue guarantees on behalf of the Republic of the Philippines to
secure, absolutely and unconditionally, the performance of guarantee obligations
undertaken by the Company pursuant to Section 4, paragraph (11) hereof. Such
guarantees shall contain such terms and conditions as the President of the
Philippines or his duly authorized representative may deem appropriate,
including without limitation the terms and conditions set forth in the preceding
paragraph (b), and shall not be subject, as to the amount thereof, to the
limitations prescribed under Republic Act No. 6142, as amended."
