The BSP was created by CA No.
111 “to promote… the ability of boys to do useful “Indeed, the BSP performs functions which may be classified as
things for themselves and others, … and to inculcate in them patriotism, civic
consciousness and responsibility, courage, self-reliance, discipline and kindred
virtues, and moral values, using the method which are in common use by boy
scouts.” BSP is not anymore a GOCC. The National Executive Board of BSP no
longer consists of several Cabinet Secretaries, except the Secretary of Education,
under RA 7278. COA asserts jurisdiction over BSP contending that it is still a
government agency. Is BSP still an “instrumentality” of the government and
therefore under COA’s jurisdiction?
BSP’s contention:
1. Control Test
a. The government does not own the BSP.
“BSP is a non-stock and non-profit organization composed
almost entirely of members coming from the private sector,
more particularly boys ranging from ages four (known as KID
Scouts) to seventeen (known as SENIOR Scouts). The BSP is one
of the largest Scout organizations in the world today (after
Gerakan Pramuka of Indonesia and the Boy Scouts of America,
first and second, respectively) and is one of the worlds National
Scout Associations having the highest penetration rate (Scout
density), with one Scout out of two boys of Scouting age enrolled
in the Scouting program.14 Since the BSP is composed almost
entirely of members and officers from the private sector, the BSP
is clearly not owned by the government.”
b. The government does not control the BSP.
“There is absolutely nothing which demonstrates that the
President of the Philippines exercises control over the acts or
decisions of the BSPs National Executive Board or any of its
members.”
c. The funds of the BSP are private in nature.
“BSPs properties are being managed and operated by the BSP
itself, not by the government or any of its agencies. Therefore, it
is crystal-clear that the funds of the BSP come from private
sources. As such, the BSP funds are necessarily beyond the
jurisdiction of the COA, which exclusively audits public funds and
assets.”
d. Public purpose of BSP is not determinative of status.
public in character, in the sense that it promotes virtues of
citizenship and patriotism and the general improvement of the
moral spirit and fiber of our youth. However, this fact alone does
not automatically make the BSP a GOCC. Significantly, the Court
declared in Philippine Society for the Prevention of Cruelty to
Animals v. Commission on Audit,27the fact that a certain juridical
entity is impressed with public interest does not, by that
circumstance alone, make the entity a public corporation,
inasmuch as a corporation may be private although its charter
contains provisions of a public character, incorporated solely for
the public good.”
2. Economic Viability Test
“The fact that a certain juridical entity is impressed with public interest does
not, by that circumstance alone, make the entity a public corporation,
inasmuch as a corporation may be private although its charter contains
provisions of a public character, incorporated solely for the public
good.36 Neither does administrative relationship to the government indicate
that an entity is an instrumentality within the purview of the COAs audit
jurisdiction. Only corporations controlled and owned by the government,
which are subject to the test of economic viability, and government
instrumentalities, as defined by the Administrative Code, fall under COAs
audit jurisdiction. The BSP is neither; hence, it is beyond the COAs audit
jurisdiction.”
Not all corporations, which are NOT government owned or controlled, are ipso
facto to be considered private corporations as there exists another distinct class
of corporations or chartered institutions which are otherwise known as “public
corporations.” These corporations are treated by law as agencies or
instrumentalities of the government which are not subject to the tests of
ownership or control and economic viability but to different criteria relating to
their public purposes/interests or constitutional policies and objects and their
administrative relationship to the government or any of its Departments or
Offices.
Economic Viability and Ownership and Control Test are inapplicable to Public
Corporations.
 We can look at the purpose of the creation of a corporation but we
can’t just look at that anymore because nowadays created to
promote interest, good or convenience of the public. So the true
 criteria in determining whether a corporation is public or private is
found in the totality of the relation of the corporation to the State.
If the corporation is created by the State as the latter’s own agency
or instrumentality to help it in carrying out its governmental
functions, then that corporation is considered public; otherwise it is
private.
 Applying the above test, provinces, chartered cities, and barangays
can best exemplify public corporations. They are created by the state
as its own device and agency for the accomplishment of parts of its
own public works.
 Now, however, the BSP and the GSP have been classified as a “sui
generis” GOCC by the Governance Commission through
Memorandum Order No. 2013-42. The issue now is whether this
administrative Memorandum has altered the character of BSP.
Decentralization of power
 Whether an act is permissible or not
 Decentralizing policies
 Involves an abdication of political power in favor of local
government units declared to be autonomous. In that case, the
autonomous government is free to chart its own destiny and shape
its future with minimum intervention from central authorities
(Limbona v. Mangelin)
Decentralization of administration
 Devolving functional powers
Administrative Powers or Political Powers?
 What is the kind of decentralization adopted or practiced in the
Philippines?
 Pimentel v. Aguirre: Under the Philippine concept of local
autonomy, the national government has not completely
relinquished all its powers over local governments, including
autonomous regions. Only administrative powers over local affairs
are delegated to political subdivisions. Thus, policy-setting for the
entire country still lies in the President and Congress.
Local Autonomy
 Limbona v. Mangelin: Now, autonomy is either decentralization of
administration or decentralization of power.
 There is decentralization of administration when the central
government delegates administrative powers to political
subdivisions in order to broaden the base of government power and
in the process to make local governments “more responsive and
accountable,” and “ensure their fullest development as self-reliant
communities and make them more effective partners in the pursuit
of national development and progress.”
Local autonomy is a concept, and not a rule. It means that it will not be used to
determine the validity of an act.
If there are rules available, the rules will prevail. If none, then maybe local
autonomy will be used.
Pimentel v. Ochoa
Tension
 The affirmation that the Philippines is still a unitary government and
the guarantee that LGUs shall enjoy local autonomy create a tension
between the national government and the local governments.
Magtajas case:
 The rationale of the requirement that the ordinances should not
contravene a statute is obvious. Municipal governments are only
agents of the national government. Local councils exercise only
delegated legislative powers conferred on them by Congress as the
national lawmaking body. The delegate cannot be superior to the
principal or exercise powers higher than those of the latter.
 Casino – a congressional allowed activity
 Congress retains control of the local government unit, though lesser
na
Lina, Jr. Case
 Ours is still a unitary form of government, not a federal state. Being
so, any form of autonomy granted to local governments will
necessarily be limited and confined within the extent allowed by the
central authority.
LLDA vs. CA
 The power of the Authority to grant permit for fishpens, fishcages
and other aqua-culture structures is for the purpose of effectively
regulating and monitoring activities in the Laguna de Bay region. It
does partake of the nature of police power which is the most
pervasive, the least limitable and the most demanding of all State
 powers including the power of taxation. Accordingly, the charter of
the Authority which embodies a valid exercise of police power
should prevail over the Local Government Code of 1991 on matters
affecting Laguna de Bay.
 LLDA was created for purposes of regulating the activities of Laguna
de Bay and was created before the LGC.
 LLDA issued cease and desist orders to the municipalities for
encroaching their powers.
 LGC says they now have the power to issue permits because of LGC
of 1991 as it expressly grants them the power to issue fishing
permits/licenses.
 Superseded the power: Special Law vs. General Law  Special law
(LLDA) prevails
 LLDA’s power is regulatory (police power) while the LGC’s power is
revenue raising, for purposes of taxation
Tano v. Socrates
 The centerpiece of LGC is the system of decentralization as expressly
mandated by the Constitution. Indispensable to decentralization is
devolution. Any fair and reasonable doubt as to the existence of the
power shall be interpreted in favor of the local government unit
concerned.
Imbong v. Ochoa – Local Autonomy
A law was passed calling for the abolition of barangays. Is the unconstitutional?
Why or why not?
This law contravenes Sec 1 of Article 10 of the 1987 Constitution because
barangays are mandated by the Constitution to exist. However, this does not
preclude from abolishing a specific barangay, provided the requirements are
present.
Territorial and Political Subdivsions:
Regular LGUs Provinces, cities, municipalities, barangays
Autonomous Regions Muslim Mindanao and Cordilleras
Special LGUs Special Metropolitan Political Subdivisions
Cordilleras – not a political subdivision but an administrative region because they
were not created pursuant to law but created upon presidential issuances. Helps
the government function at a local level
Kinds of Cities:
1. Component Cities – not qualified to be highly urbanized; inhabitants can
vote for provincial candidates and can run for provincial elective posts =
under the supervisory power of the province
2. Independent Component City – independent in the sense that the
charter prohibits the voters from voting for provincial elective posts =
outside the supervisory power of province (Abella v. COMELEC)
3. Highly Urbanized City – independent from province by reason of
status/income = outside the supervisory power of the province
Abella vs. COMELEC
 The phrase “shall not be qualified and entitled to vote in the election
of the provincial governor and the members of the provincial board
of the Province of Leyte” as found in the Charter of Ormoc City
connotes two prohibitions:
1. From running for provincial elective posts
2. From voting for provincial candidates
Mandaue City – classified as highly urbanized only on 1991
Section 452. Highly Urbanized Cities. Qualified voters of cities who acquired the
right to vote for elective provincial officials prior to the classification of said cities
as highly-urbanized after the ratification of the Constitution and before the
effectivity of this Code, shall continue to exercise such right.
Vested Right Theory:
Sec. 12 Art. X, 1987 Constitution – Cities that are highly urbanized, as
determined by law, and component cities whose charters prohibit their voters
from voting for provincial elective officials, shall be independent of the province.
The voters of component cities within a province, whose charters contain no
such prohibition, shall not be deprived of their right to vote for elective provincial
officials.
Special Metropolitan Political Subdivisions
 Created by Congress and requires plebiscite
 The component cities and municipalities shall retain their basic
autonomy and shall be entitled to their own local executives
MMDA v. Bel-Air Village
  MMDA is not a local government unit. It is not even a special Umali v. Comelec
metropolitan political subdivision because there was no plebiscite
While conversion to an HUC is not explicitly provided in the Consti, the
held after the law that created it was enacted and the President
conversion of a component city into an HUC is substantaial alteration of
exercise not just supervision but control over it.
boundaries. As the phrase implies, “substantial alteration of boundaries”
 MMDA has purely administrative function.
involves and necessarily entails a change in the geographical configuration of a
 MMDA is not a political subdivision, it cannot exercise political
local government unit or units. The phrase “boundaries” should not be limited
power like police power.
to the mere physical one, referring to the metes and bounds of the LGU, but also
 2 Reasons why: No Plebiscite was conducted and Not intended to be
to its political boundaries.
a political subdivision and the President has complete supervision
over MMDA The COMELEC can postpone the holding of a Plebiscite (and election) to
another date
Loose Federation of LGUs
 LGUs may group themselves, consolidate or coordinate their efforts, The COMELEC has “exclusive charge of the enforcement and administration of
services, and resources for purposes commonly beneficial to them in all laws relative to the condict
accordance with law. (Sec. 13, Art. X, Constitution)
 How?
1. Through Ordinances,
2. Upon approval by the Sanggunian concerned, after lawful hearing,
contribute funds and assets through MOA (Sec. 33, LGU)

May this federation or consolidation of local government units enter into

contracts? If yes, how may the federation or consolidation of LGUs enter into
contracts? Under what name?

 The resultant consolidation would not be a separate body.

City of Paranaque vs. Katipunan ng mga Mamamayan ng Bagong Paranaque

There was an ordinance that substantially changed the boundaries of a

barangay. Thus a plebiscite is required.

In 1998, by virtue of RA No. 8528, the City of Santiago, Isabela was converted
from an independent component city to a component city. The consititutionality
of RA No. 8528 was assailed on the ground of lack of provision in the said law
submitting the same for ratification by the people of Santiago City in a proper
plebiscite. The issue was whether the downgrading of Santiago City from an
independent component city to ma mere component requires the approval of
the people of Santiago City. Decide.

Plebiscite will only be in the city concerned.