Presidential Decree No. 894 (PD 894) — Requiring Government Offices, Agencies, Instrumentalities and Government Owned or Controlled Corporations, Persons and Entities Enjoying Tax Exemption, Incentive or Subsidy from the Government to Utilize in International Transportation the Services of the Philippine Flag Air Carrier and Shipping Lines and for Other Purposes.
WHEREAS, it is necessary for our national economic
development that every effort is exerted by all to save and conserve our
foreign exchange reserves;
WHEREAS, payment of transportation fares to foreign airlines
and shipping lines, even if made in Philippine Currency, constitutes a
heavy drain to our foreign exchange reserves in view of the fact that
such foreign airlines and shipping lines remit abroad their receipts in
excess of their local expenses;
WHEREAS, the Philippine flag air carrier and shipping lines
operating international transportation perform transportation services
of vital importance to the foreign commerce and trade of the Philippines
including its balance of payments, to the Postal Service, and to the
national security and defense;
WHEREAS, in most countries of the World, the policy and
practice of granting preference to the national flag air carrier and
shipping lines over foreign air carriers and shipping lines with respect
to transportation of Government financed passengers and property has
either been adopted and implemented or is in the process of being
adopted and implemented;
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 as follows ;
SECTION 1. Whenever any branch, department, agency,
instrumentality or office of the Government including local governments
and corporations and institutions owned and controlled by the
Government, shall procure, contract for, or otherwise obtain, directly
or indirectly, any transportation of persons or property by air or water
between the Philippines and a place outside thereof or between two
places both of which are outside the Philippines, the payment for which
is made directly or indirectly from funds of the Republic of the
Philippines, the appropriate agency or agencies and public officials
concerned shall take such steps as may be necessary to assure that such
transportation is provided by the Philippine flag air carrier or
shipping lines to the maximum extent service by such carrier and
shipping lines is available.
SEC. 2. Any person, partnership, association or
corporation, contractor and subcontractor, granted and enjoying any tax
exemption, subsidy or incentive from the Government, or with an
outstanding loan from or whose existing obligation is guaranteed by the
Government or by any Government owned or controlled corporation and
financial institution, or awarded any contract by the Government or any
of its agencies and instrumentalities, requiring any transportation of
persons and property by air or water between the Philippines and a place
outside thereof or between two places both of which are outside the
Philippines, the payment for which is made directly or indirectly from
the funds of such person, partnership, association, corporation,
contractor or subcontractor, shall cause such air or water
transportation to be provided by the Philippine flag air carrier or
shipping lines to the maximum extent service by such air carrier or
shipping lines is available: Provided, That, any such person,
partnership, association, corporation, contractor or subcontractor may
procure the services of foreign air carriers or shipping lines to the
extent that services by the Philippine flag air carrier or shipping
lines is not available, only upon prior certification by the Civil
Aeronautics Board or by the Board of Transportation, as the case may be.
SEC. 3. The Auditor General shall disallow any
expenditure from appropriated funds of the Government for payment of
passenger or cargo transportation on foreign flag air carriers and
shipping lines in the absence of satisfactory proof of the clear
necessity therefor.
SEC. 4. Any violation of the provisions of Section 2
shall cause the withdrawal, revocation, cancellation, or acceleration of
payment, as the case may be, of the tax exemption, subsidy, incentive,
loan, guarantee and contract of such person, partnership, association or
corporation.
SEC. 5. All laws, decrees, orders, rules and regulations
or part thereof inconsistent with this Decree are hereby repealed or
modified accordingly.
SEC. 6. This Decree shall take effect immediately.
Done in the City of Manila, this 26th day of February, in the
year of Our Lord, nineteen hundred and seventy-six.
(Sgd.)
FERDINAND E. MARCOS
President
Republic of the Philippines
By the President:
(Sgd.)
JUAN C. TUVERA
Presidential Assistant
Source: Supreme Court E-Library, Republic of the Philippines. Philippine laws are public documents (works of the government).
