G.R. No. 159149 June 26, 2006 The HONORABLE SECRETARY VINCENT S.

PEREZ, in his capacity as the Secretary of the Department of Energy, Petitioner, vs.LPG REFILLERS ASSOCIATION OF THE PHILIPPINES, INC., Respondent. QUISUMBING, J.: Before us is a petition for review on certiorari under Rule 45, assailing the Decision1 and Order2 of the Regional Trial Court of Pasig City, Branch 161, in SCA Case No. 2318, which nullified Circular No. 2000-06-010 of the Department of Energy (DOE). The facts are undisputed. Batas Pambansa Blg. 33, as amended, penalizes illegal trading, hoarding, overpricing, adulteration, underdelivery, and underfilling of petroleum products, as well as possession for trade of adulterated petroleum products and of underfilled liquefied petroleum gas (LPG) cylinders.3 The said law sets the monetary penalty for violators to a minimum of P20,000 and a maximum of P50,000.4 On June 9, 2000, Circular No. 2000-06-010 was issued by the DOE to implement B.P. Blg. 33, thus: SECTION 4. NO PRICE DISPLAY BOARD LPG Marketer/LPG Dealer/LPG Retail Outlet 1st Offense - Reprimand/warning letter 2nd Offense - Recommend suspension of business operation to the proper local government unit 3rd Offense - Recommend business closure to the proper local government unit and initiate criminal proceedings SECTION 5. NO WEIGHING SCALE A. LPG Refiller/Marketer 1st Offense - Fine of P5,000 2nd Offense - Fine of P10,000 3rd Offense - Recommend business closure to the proper local government unit B. Dealer 1st Offense - Fine of P3,000 2nd Offense - Fine of P7,000 3rd Offense - Recommend business closure to the proper local government unit C. LPG Retail Outlet 1st Offense - Reprimand 2nd Offense - Fine of P500.00 3rd Offense - Fine of P1,000.00 SECTION 6. NO TARE WEIGHT OR INCORRECT TARE WEIGHT MARKINGS. (REQUIREMENT ON ENGRAVED TARE WEIGHT SHALL TAKE EFFECT TWO (2) YEARS AFTER EFFECTIVITY OF THIS CIRCULAR)

A. LPG Refiller/Marketer 1st Offense - Fine of P3,000 for each cylinder 2nd Offense - Fine of P5,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit B. Dealer 1st Offense - Fine of P2,000 for each cylinder 2nd Offense - Fine of P4,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit C. LPG Retail Outlet 1st Offense - Fine of P1,000 for each cylinder 2nd Offense - Fine of P2,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit SECTION 7. NO APPROPRIATE OR AUTHORIZED LPG SEAL A. LPG Refiller/Marketer 1st Offense - Fine of P3,000 for each cylinder 2nd Offense - Fine of P5,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit B. Dealer 1st Offense - Fine of P2,000 for each cylinder 2nd Offense - Fine of P4,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit C. LPG Retail Outlet 1st Offense - Fine of P1,000 for each cylinder 2nd Offense - Fine of P2,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit SECTION 8. NO TRADE NAME, UNBRANDED LPG CYLINDERS, NO SERIAL NUMBER, NO DISTINGUISHING COLOR, NO EMBOSSED IDENTIFYING MARKINGS ON CYLINDER OR DISTINCTIVE COLLAR OR DESIGN (REQUIREMENT ON SERIAL NUMBER AND DISTINCTIVE COLLAR OR DESIGN SHALL TAKE EFFECT TWO (2) YEARS AFTER EFFECTIVITY OF THIS CIRCULAR) A. LPG Refiller/Marketer 1st Offense - Fine of P4,000 for each cylinder 2nd Offense - Fine of P5,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit B. Dealer 1st Offense - Fine of P3,000 for each cylinder 2nd Offense - Fine of P4,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit C. LPG Retail Outlet 1st Offense - Fine of P1,000 for each cylinder 2nd Offense - Fine of P2,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit SECTION 9. UNDERFILLED LPG CYLINDERS A. LPG REFILLER/MARKETER 1st Offense - Fine of P4,000 for each cylinder

2nd Offense - Fine of P6,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit B. DEALER 1st Offense - Fine of P3,000 for each cylinder 2nd Offense - Fine of P4,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit C. LPG RETAIL OUTLET 1st Offense - Fine of P1,000 for each cylinder 2nd Offense - Fine of P2,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit SECTION 10. TAMPERING, ALTERING, OR MODIFYING OF LPG CYLINDER THRU ANY MEANS SUCH AS BUT NOT LIMITED TO CHANGING THE VALVE, REPAINTING, AND RELABELLING BY ANY PERSON OR ENTITY OTHER THAN THE LEGITIMATE AND REGISTERED OWNER OF THE SAME. FOR THIS PURPOSE, LPG REFILLER, MARKETER, DEALER, OR RETAIL OUTLET, AS THE CASE MAY BE, WHO HAS POSSESSION OF SUCH ILLEGALLY TAMPERED, ALTERED, OR OTHERWISE MODIFIED LPG CYLINDER SHALL BE HELD LIABLE FOR THIS OFFENSE A. LPG Refiller/Marketer 1st Offense - Fine of P5,000 for each cylinder 2nd Offense - Fine of P10,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit B. Dealer 1st Offense - Fine of P3,000 for each cylinder 2nd Offense - Fine of P5,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit C. LPG Retail Outlet 1st Offense - Fine of P1,500 for each cylinder 2nd Offense - Fine of P3,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit SECTION 11. UNAUTHORIZED DECANTING OR REFILLING OF LPG CYLINDERS 1st Offense - Fine of P5,000 for each cylinder 2nd Offense - Fine of P10,000 for each cylinder 3rd Offense - Recommend business closure to the proper local government unit SECTION 12. HOARDING OF PETROLEUM PRODUCTS INCLUDING LIQUEFIED PETROLEUM GAS 1st Offense - Fine of P10,000 per cylinder 2nd Offense - Recommend business closure to the proper local government unit plus the filing of appropriate criminal action SECTION 13. REFUSAL TO ALLOW OR COOPERATE WITH DULY AUTHORIZED INSPECTORS OF THE ENERGY INDUSTRY ADMINISTRATION BUREAU (EIAB) OF THE DEPARTMENT OF ENERGY IN THE CONDUCT OF THEIR INSPECTION/INVESTIGATION, WHETHER REGULAR AND ROUTINARY OR COMPLAINT-INITIATED 1st Offense - Fine of P10,000

2nd Offense - Recommend business closure to the proper local government unit SECTION 14. REFUSAL OR FAILURE TO PAY FINE The Department of Energy shall recommend to the proper local government unit the closure of business of a respondent who refuses or fails to pay any administrative fine without prejudice to the filing of an appropriate criminal action if warranted.5 Respondent LPG Refillers Association of the Philippines, Inc. asked the DOE to set aside the Circular for being contrary to law. The DOE, however, denied the request for lack of merit. Respondent then filed a petition for prohibition and annulment with prayer for temporary restraining order and/or writ of preliminary injunction before the trial court. After trial on the merits, the trial court nullified the Circular on the ground that it introduced new offenses not included in the law.6 The court intimated that the Circular, in providing penalties on a per cylinder basis for each violation, might exceed the maximum penalty under the law. The decretal part of its Decision reads: IN VIEW OF THE FOREGOING, this Court renders judgment declaring DOE Circular No. 2000-06-010 null and void and prohibits the respondent from implementing the same. SO ORDERED.7 The trial court denied for lack of merit petitioners motion for reconsideration. Hence this petition, raising the following issues: IWHETHER OR NOT THE COURT A QUO GRAVELY ERRED IN HOLDING THAT "A CLOSE SCRUTINY OF BP 33, PD 1865 AND R.A. NO. 8479 SHOWS THAT OFFENSES LIKE NO PRICE DISPLAY [BOARD], NO WEIGHING SCALE, ETC. SET FORTH IN THE CIRCULAR ARE NOT PROVIDED FOR IN ANY OF THE THREE (3) LAWS". IIWHETHER OR NOT THE COURT A QUO GRAVELY ERRED IN HOLDING THAT "A SCRUTINY OF THE NEW SET OF PENALTIES PROVIDED BY THE CIRCULAR SHOWS THAT THE PENALTIES THIS TIME ARE BASED ON PER CYLINDER BASIS"; THAT "BEING SUCH, NO CEILING WAS PROVIDED FOR AS TO THE ADMINISTRATIVE FINES"; THAT "AS ILLUSTRATED BY THE PETITIONER, FOR JUST ONE LPG CYLINDER FOUND VIOLATING AT LEAST SEC[TIONS] 6, 7, 8, 9, 10 AND 11 OF THE [CIRCULAR], A FINE OF P24,000.00 IS IMPOSED;" AND THAT "THIS WILL CLEARLY BE BEYOND THE P10,000.00 PROVIDED BY THE LAWS." IIIWHETHER OR NOT THE COURT A QUO GRAVELY ERRED IN HOLDING THAT SECTION 16 OF PETITIONERS CIRCULAR WHICH AUTHORIZES THE IMPOSITION OF PECUNIARY PENALTIES WITH THE TOTAL FINE NOT EXCEEDING P20,000.00 FOR RETAIL OUTLETS VIOLATES

THE PENALTY CEILING OF P10,000.00 SET UNDER BP BLG. 33, AS AMENDED. IVWHETHER OR NOT THE COURT A QUO GRAVELY ERRED IN HOLDING THAT SINCE SECTION 5(g) OF R.A. 7638 FINDS NO REFERENCE IN DOE CIRCULAR NO. 200006-010, THE SAME SHOULD BE DISREGARDED. VWHETHER OR NOT THE COURT A QUO GRAVELY ERRED IN HOLDING THAT "ON THE NEW OFFENSES INTRODUCED IN THE CIRCULAR SUCH AS SECTIONS 4, 5, 10, 13 AND 14 AND THE IMPOSITION OF THE GRADUATED PENALTIES ON A PER CYLINDER BASIS, THIS COURT FINDS [NO] REASON TO DISTURB ITS FINDINGS THAT RESPONDENT-MOVANT EXCEEDED ITS AUTHORITY. X X X IT SHOULD BE REMEMBERED THAT BP BLG. 33 AS AMENDED AND P.D. 1865 ARE CRIMINAL STATUTES AND MUST BE CONSTRUED WITH SUCH STRICTNESS AS TO CAREFULLY SAFEGUARD THE RIGHTS OF THE DEFENDANT." VIWHETHER OR NOT THE COURT A QUO ERRED IN HOLDING THAT "THE ASSAILED CIRCULAR SETS NO MAXIMUM LIMIT AS TO THE FINE THAT MAY BE IMPOSED ON AN ERRING PERSON OR ENTITY TO WHICH FACT MOVANT CONCEDES. FOR ONE (1) CYLINDER ALONE, NOT ONLY DOES THE CIRCULAR MAKE THE FINE EXCESSIVE TO THE EXTENT OF BEING CONFISCATORY, BUT IT EVEN IMPOSES A PENALTY WHICH MAY EVEN GO BEYOND THAT MAXIMUM IMPOSABLE FINE OF P50,000.00 SET BY P.D. 1865 IN ITS SEC. 4 AFTER A CRIMINAL PROCEEDING." 8 To our mind, the issue raised by petitioner may be reduced to the sole issue of whether the Regional Trial Court of Pasig erred in declaring the provisions of the Circular null and void, and prohibiting the Circulars implementation. Petitioner argues that the penalties for the acts and omissions enumerated in the Circular are sanctioned by Sections 1 9 and 3A10 of B.P. Blg. 33 and Section 2311 of Republic Act No. 8479.12 Petitioner adds that Sections 5(g)13 and 2114 of Republic Act No. 763815 also authorize the DOE to impose the penalties provided in the Circular. Respondent counters that the enabling laws, B.P. Blg. 33 and R.A. No. 8479, do not expressly penalize the acts and omissions enumerated in the Circular. Neither is the Circular supported by R.A. No. 7638, respondent claims, since the said law does not pertain to LPG traders. Respondent maintains that the Circular is not in conformity with the law it seeks to implement. We resolve to grant the petition. For an administrative regulation, such as the Circular in this case, to have the force of penal law, (1) the violation of the administrative regulation must be made a crime by the delegating

statute itself; and (2) the penalty for such violation must be provided by the statute itself.16 The Circular satisfies the first requirement. B.P. Blg. 33, as amended, criminalizes illegal trading, adulteration, underfilling, hoarding, and overpricing of petroleum products. Under this general description of what constitutes criminal acts involving petroleum products, the Circular merely lists the various modes by which the said criminal acts may be perpetrated, namely: no price display board, no weighing scale, no tare weight or incorrect tare weight markings, no authorized LPG seal, no trade name, unbranded LPG cylinders, no serial number, no distinguishing color, no embossed identifying markings on cylinder, underfilling LPG cylinders, tampering LPG cylinders, and unauthorized decanting of LPG cylinders. These specific acts and omissions are obviously within the contemplation of the law, which seeks to curb the pernicious practices of some petroleum merchants. As for the second requirement, we find that the Circular is in accord with the law. Under B.P. Blg. 33, as amended, the monetary penalty for any person who commits any of the acts aforestated is limited to a minimum of P20,000 and a maximum of P50,000. Under the Circular, the maximum pecuniary penalty for retail outlets is P20,000,17 an amount within the range allowed by law. However, for the refillers, marketers, and dealers, the Circular is silent as to any maximum monetary penalty. This mere silence, nonetheless, does not amount to violation of the aforesaid statutory maximum limit. Further, the mere fact that the Circular provides penalties on a per cylinder basis does not in itself run counter to the law since all that B.P. Blg. 33 prescribes are the minimum and the maximum limits of penalties. Clearly, it is B.P. Blg. 33, as amended, which defines what constitute punishable acts involving petroleum products and which set the minimum and maximum limits for the corresponding penalties. The Circular merely implements the said law, albeit it is silent on the maximum pecuniary penalty for refillers, marketers, and dealers. Nothing in the Circular contravenes the law. Noteworthy, the enabling laws on which the Circular is based were specifically intended to provide the DOE with increased administrative and penal measures with which to effectively curtail rampant adulteration and shortselling, as well as other acts involving petroleum products, which are inimical to public interest. To nullify the Circular in this case would be to render inutile government efforts to protect the general consuming public against the nefarious practices of some unscrupulous LPG traders. WHEREFORE, the petition is GRANTED. The assailed Circular No. 2000-06-010 of DOE is declared valid. The Decision and Order of the Regional Trial Court of Pasig City, Branch 161, in SCA Case No. 2318, nullifying said Circular and prohibiting its implementation are hereby REVERSED and SET ASIDE.No pronouncement as to costs. SO ORDERED.