AN ACT CREATING THE PRIVATE DEBT RESTRUCTURING AND REPAYMENT CORPORATION DEFINING ITS POWERS AND FOR OTHER PURPOSES.

• Number: Presidential Decree No. 2000
• Sections: 22

Preamble

WHEREAS, it is a declared objective of the Government of the

Republic of the Philippines to ensure the viability of the private corporate

sector;

WHEREAS, there is an imperative need to adopt and implement

a program for the repayment of foreign currency debt obligations owed by

Philippine private corporate sector borrowers in a manner consistent with the

continuing viability of such companies and supportive of the Philippine economic

recovery program;

WHEREAS, it is recognized that such repayment program must

essentially provide a system under which foreign exchange risk protection is

furnished with respect to current and future maturities of private corporate

sector foreign currency debt;

WHEREAS, the Central Bank of the Philippines has been

authorized under Presidential Decree No. 1961 in connection with the

restructuring of Philippine foreign currency debt to adopt and implement,

directly or through a subsidiary, a foreign exchange risk protection

program.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the

Philippines, by virtue of the powers vested in me by the Constitution, do hereby

order and decree:

Section 1 Corporate Body.

SECTION 1. Corporate Body.— There is hereby created

a body corporate to be known as the Private Debt Restructuring and Repayment

Corporation, hereinafter referred to as the "Corporation".

Section 2 Principal Office.

SEC. 2. Principal Office.—The Corporation shall

have its principal office in Metropolitan Manila, Philippines, and may have such

branches elsewhere in the Philippines as may be necessary or proper for the

attainment of its objectives.

Section 3 Capitalization.

SEC. 3. Capitalization. —The Corporation shall have

an authorized capital of Two Billion Pesos (P2,000, 000,000.00) of which Five

Hundred Million Pesos (P500,000,000.00) shall be initially subscribed and Twenty

Five Million Pesos (P25,000,000.00) paid for by the Central Bank of the

Philippines.

Section 4 Responsibilities and Objectives.

SEC. 4. Responsibilities and Objectives.—It shall

be the responsibility of the Corporation to administer the program for the

rescheduling and repayment of the foreign currency debt of the private corporate

sector.

It shall be the duty of the Corporation to use the powers granted to it under

this Decree to achieve the following principal objectives:

(a) To provide Philippine private corporate sector borrowers and their

creditors with flexible options for the repayment of outstanding foreign

currency debt in a manner consistent with the continuing financial viability and

the debt service capability of these companies;

(b) To provide forward

exchange protection to corporations that wish to avail themselves of such cover;

and

(c) To assist the Central Bank in managing the outflow of foreign

exchange from the Philippines consistent with the Government economic adjustment

program.

Section 5 Corporate Powers.

SEC. 5. Corporate Powers. —The Corporation shall

have the following powers and functions:

To enter into forward exchange transactions or any other transaction with

any domestic non-99 financial entity, enterprise or corporation duly registered

and/or licensed under the laws of the Republic of the Philippines which will

enable said entity, enterprise or corporation to hedge foreign exchange risk

associated with any of its foreign currency-denominated restructured debt;

To extend peso-denominated loans to any such domestic non-financial entity,

enterprise or corporation the proceeds of which shall be utilized solely for the

purpose of settling its restructured foreign currency-denominated debt;

To obtain or arrange for borrowings from domestic or foreign sources as may

be necessary and whenever warranted;

To buy, sell and deal in foreign exchange;

To make contracts;

To lease or own real and personal property and to sell, mortgage or

otherwise dispose of the same;

To sue and be sued;

To adopt, alter, and use a corporate seal;

To invest funds not needed in its operations; and

To exercise the general power of a corporation mentioned in the Corporation

Code of the Philippines insofar as they are not inconsistent with the provisions

of this Decree and otherwise to do and perform any and all things necessary or

proper to accomplish the objectives of this Decree, or essential to the proper

conduct of the operations of the Corporation, or as may be directed by the

President of the Philippines.

Section 6 Foreign Borrowings.

SEC. 6. Foreign Borrowings.—The Corporation may

contract foreign currency loans, credits or indebtedness with the guarantee of

the Republic of the Philippines, upon such terms as may be agreed with the

lenders, subject to the concurrence, general or specific, of the Monetary Board

and further to the final approval of the President of the Philippines.

Section 7 Exchange Profits and Losses.

SEC. 7. Exchange Profits and Losses. —All foreign

exchange profits and losses which may arise from the forward exchange operations

and other foreign exchange transactions of the Corporation shall be chargeable

against the revaluation account of the Central Bank in accordance with Republic

Act No. 265, as amended.

Section 8 Board of Directors.

SEC. 8. Board of Directors.—The powers and

authority of the Corporation shall be vested in, and exercised by, a Board of

Directors, hereinafter referred to as the "Board", consisting of the Governor,

Central Bank of the Philippines, as ex-officio Chairman, a Vice-Chairman and

five other members. The Chairman of the Development Bank of the Philippines, the

President of the Philippine National Bank, and two members from the Monetary

Board to be designated by the Monetary Board, shall be ex-officio members of the

Board. Two other members from the government or private sector shall be

appointed by the President of the Philippines. The appointive members of the

Board shall serve for a period of one year from the date of appointment and

until their respective successors shall have been duly appointed and have

qualified. The members of the Board shall elect from among themselves the

Vice-Chairman.

In case of death, resignation, removal, or disqualification of the

Vice-Chairman or any member of the Board, the successor or successors to hold

office only for the un-expired portion of the term.

Section 9 Powers of the Board.

SEC. 9. Powers of the Board.—The Board shall have

the following powers:

To formulate policies to carry out effectively the provisions of this

Decree, subject to the approval of the President of the Philippines;

To prepare and issue rules and regulations as it considers necessary for the

effective discharge of the responsibilities and exercise of the powers assigned

to the Corporation under this Decree;

To direct the management, operations, and administration of the Corporation;

To authorize such expenditures by the Corporation as are in the interest of

the effective administration and operations of the Corporation; and

To exercise such other powers as may be necessary to accomplish the purposes

for which the Corporation was organized.

Section 10 Meetings.

SEC. 10. Meetings.— The Board shall meet regularly

at least once a month at the office of the Corporation, unless otherwise

determined by the Board. Special meetings of the Board shall be held whenever so

requested by the Chairman or on the written request of two (2) directors.

Section 11 Remuneration of Members for Attending Meetings of the Board.

SEC. 11. Remuneration of Members for Attending Meetings

of the Board. —The members of the Board shall be entitled to per diems for

every meeting actually attended in such amount as the Board may deem appropriate

but not exceeding five hundred pesos (P500.00) per meeting nor two thousand

pesos (P2.000.00) for any single month.

Section 12 Officers and other Personnel.

SEC. 12. Officers and other Personnel.—The officers

of the Corporation shall be a Chairman, a Vice-Chairman, a General Manager and a

Deputy General Manager. The General Manager, the Deputy General Manager and all

other officers and employees of the Corporation shall be appointed by the

Chairman, with the confirmation of the Board. The Central Bank may assign any

Central Bank official or employee to the Corporation on detail:

Provided, That such assignment of any Central Bank official or employee

to the Corporation shall be deemed to be in the interest of the service and not

disciplinary, any provision of existing law to the contrary notwithstanding:

Provided, further, That the assignment of such Central Bank officials

and employees shall not suspend or interrupt the continuity of their services

with the Central Bank. The remuneration and other emoluments of officers and

employees of the Corporation shall be fixed by the Board. Central Bank officials

and employees detailed to the Corporation shall continue to receive the

remuneration and other emoluments to which such officials and employees are

entitled to receive as such from the Central Bank: provided, That

Central Bank officials and employees so detailed shall not receive any

additional compensation from the Corporation: Provided, further, That

the Corporation shall pay directly or reimburse the Central Bank the

remuneration and emoluments of Central Bank officials and employees detailed to

the Corporation.

Section 13 Chairman.

SEC. 13. Chairman. —The Chairman shall preside at

all meetings of the Board. He shall submit to the President of the Philippines

quarterly reports regarding the activities and operations of the Corporation and

containing such information relating to the proceedings and policies of the

Corporation.

Section 14 Vice-Chairman.

SEC. 14. Vice-Chairman.—In. the absence of the

Chairman or in the event of his death, inability, or refusal to act, the

Vice-Chairman shall perform the duties of the Chairman and such other duties as

from time to time may be assigned to him by the Board.

Section 15 General Manager.

SEC. 15. General Manager.—The General Manager shall

be the chief executive officer of the Corporation. No person shall be appointed

General Manager of the Corporation unless he is at least thirty five of age, of

good moral character and reputation, and has reputed proficiency, expertise and

recognized competence in banking and economics, or finance, management,

government administration, or law.

Section 16 Powers and Duties of the General Manager.

SEC. 16. Powers and Duties of the General

Manager.—The General Manager of the Corporation shall have the following

duties and responsibilities:

To prepare the agenda for meetings of the Board and to submit for the

consideration of the Board policies and measures which he believes are necessary

to carry out the purposes and objectives of the Corporation;

To execute and administer the policies, measures, orders and resolutions

approved by the Board;

To execute all contracts in. behalf of the Corporation and to enter into all

transactions required or permitted by this Decree upon proper authorization by

the Board;

To recommend the appointment, promotion, assignment or removal of all

subordinate officers and employees of the Corporation;

To report periodically to the Board on the operations of the Corporation;

and

To perform such other functions as may be delegated to him by the President,

with the approval of the Board.

Section 17 Deputy General Manager.

SEC. 17. Deputy General Manager.—in the absence of

the General Manager or in the event of his death, inability or refusal to act,

the Deputy General Manager shall exercise the powers and perform the duties of

the General Manager and shall perform such other duties as from time to time may

be assigned to him by the General Manager or by the Board.

Section 18 Auditor.

SEC. 18. Auditor.—The Chairman of the Commission on

Audit shall act as the ex-officio Auditor of the Corporation and as such, is

empowered to appoint a representative who shall be the Auditor of the

Corporation and in accordance with law, fix his salary, and to appoint and fix

the salaries of the necessary personnel to assist said representative in the

performance of his duties, but in all cases subject to the approval of the

Board. The Auditor of the Corporation and personnel under him may be removed

only by the Chairman of the Commission on Audit.

Section 19 Tax Exemption.

SEC. 19. Tax Exemption.—The Corporation shall be

exempt from all national, provincial, municipal and city taxes, fees, charges

and assessments now in force or hereafter established.

Section 20 Repealing Clause.

SEC. 20. Repealing Clause.— All laws, decrees,

executive orders, rules and regulations inconsistent herewith are hereby

repealed, amended or modified accordingly.

Section 21 Effectivity Clause.

SEC. 21. Effectivity Clause.— This Decree shall

take effect immediately.

DONE in the City of Manila, Philippines, this 26th day of November, in the

year of Our Lord, nineteen hundred and eighty-five.