Republic Act No. 2046

 

 

AN ACT

A PUBLIC CORPORATION TO BE KNOWN AS THE CAVITE ELECTRICITY DISTRIBUTING AUTHORITY

 

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

 

SECTION 1.  Creation of the Cavite Electricity Distributing Authority; its general purposes; zone and extent of jurisdiction; domicile and place of business of the corporation.  – For the purpose of consolidating and centralizing the generation and distribution of electric light, heat and/or power in the Province of Cavite, under one control direction, management and supervision, there is hereby created a public corporation to be known as the Cavite Electricity Distributing Authority, which shall be organized immediately after the approval of this Act.

 

The Cavite Electricity Distributing Authority shall own and/or have jurisdiction and supervision over all electric systems within the boundaries of cities and municipalities in Cavite.

 

The domicile and place of business of the Authority shall be determined by the Board of Directors.

 

SEC. 2.  Powers and General Functions of the Authority.  – The powers, functions and activities of the Cavite Electricity Distributing Authority shall be the following:

 

(a)       To have the continuous succession under its corporate name until otherwise provided by law;

 

(b)       To prescribe its by-laws;

 

(c)       To adopt and use a seal and alter it at pleasure;

 

(d)      To sue and be sued in court;

 

(e)      To construct, maintain, and operate distribution lines for the purpose of supplying electric light, heat and/or power to the inhabitants of its zone, both for domestic and other purposes; regulate the control and use, and prevent the wastage and pilferage of electricity; to fix electric rates and provide for the collection of fees therefor;

 

(f)       To acquire, purchase, hold, transfer, sell, lease, rent, mortgage, encumber, and otherwise dispose of real and personal property, including rights and franchises, within its jurisdiction, as authorized by the purposes for which the Authority was created and reasonably and necessarily required for the transaction of the lawful business of the same, unless otherwise provided in this Act;

 

(g)      To underwrite, purchase, own, sell, mortgage or otherwise dispose of stocks, bonds, debentures, securities and other evidences of indebtedness issued for and in connection with its functions;

 

(h)      To construct works across, or otherwise, any stream, watercourse, canal, ditch, flume, street, avenue, highway, or railway, as the location of said works may require:  Provided, That such works be constructed in such manner as to afford security for life and property:  And, provided, further,  That the stream, watercourse, canal, ditch, flume, street, avenue, highway, or railway so crossed or intersected be restored to their former state as near as may be, or in a manner not to impair unnecessarily their usefulness.  Every person or entity whose right of way is crossed or intersected by said works shall not obstruct the forming of such crossing or intersection and shall grant the Authority the proper authority, upon payment of just compensation, for the execution of such work.  The Authority is hereby given the right of way to locate, construct and maintain such works over and through any of the lands which are now or may be the property of the Government of the Republic of the Philippines or any of its branches and political subdivisions;

 

(i)       To exercise the right of eminent domain for the purpose for which the Authority was created, in the manner provided by law for condemnation proceedings by the national, provincial, and municipal government;

 

(j)       When essential to the proper administration of its corporate affairs or when necessary for the proper transaction of its business or for carrying out the purposes for which it was organized, to contract indebtedness and issue bonds, subject to the approval of the Provincial Governor of Cavite and the Secretary of Finance.  The bonded indebtedness of the Authority, of all classes, shall not at any time exceed ten million pesos, and the issue thereof shall be subject to the conditions set forth in section five of this Act;

 

(k)      To issue such regulations as may be necessary for the proper distribution of electric light, heat and/or power, and for the protection of its distribution systems, as soon as established, any violation of which shall be punished by a fine of not more than five hundred pesos or by imprisonment for not more than six months, or both such fine and imprisonment in the discretion of the court; and

 

(l)       To transact the business for which it was organized and do such things as may be reasonably necessary to carry out the purposes for which it was established.

 

SEC. 3.  Exercise of corporate power; conduct of affairs and current business; officers and employees of the Authority, their appointment and qualifications, their salaries and functions.  – Unless otherwise provided by law, all corporate powers of the Cavite Electricity Distributing Authority shall be exercised, its business managed, and its properties kept and preserved, by a Board of Directors to be composed of five members, a chairman and four other members.

 

The affairs and current business of the Cavite Electricity Distributing Authority shall be conducted under the direction of the Board, by a general manager, a chief engineer, a treasurer, an auditor, and such additional officers and employees as the Board may provide.

 

The duties and powers as well as the compensation of said officers and employees shall be such as may be defined and prescribed or fixed by the Board which shall not be inconsistent with the provisions of this Act and other existing laws.

 

(a)      Chairman-General Manager.  – The Chairman shall be appointed by the Provincial Governor of Cavite, with the consent of the Public Utilities Commission, and may be removed for cause by the Provincial Governor of Cavite.  He shall, as ex officio General Manager of the Authority, represent the Authority in all its business matters; shall submit to the Board an annual report and such partial reports as may be required by it or he may see fit to render from time to time, regarding the condition of the business, or of any part of the business of the Cavite Electricity Distributing Authority; and shall perform such other executive duties as may be prescribed by law or may be required of him by resolution of the Board.

 

(b)      Board Member-Chief Engineer.  – One member of the Board shall at least be an electrical engineer, who shall be appointed by the Provincial Governor of Cavite with the consent of the Board of Directors of National Power Corporation, and may be removed for cause by the Provincial Governor of Cavite.  He shall, as ex officio Chief Engineer of the Authority, perform such duties as may be required of him by the Board or by the General Manager.  He shall act as general manager in case of the temporary disability or absence of the general manager.

 

(c)      Board Member-Treasurer.  – One member of the Board shall possess knowledge of business management and finance, who shall be appointed by the Provincial Governor of Cavite, with the consent of the Board of Directors of the Rehabilitation Finance Corporation, and may be removed for cause by the Provincial Governor of Cavite.  He shall, as ex officio treasurer of the Authority, perform such duties as may be required of him by the Board or by the General Manager.

 

(d)      The two other members of the Board, who shall represent the consumers, shall be appointed by the Provincial Governor of Cavite, upon election by the city and municipal mayors of Cavite in meeting assembled, and shall hold office for two years unless otherwise removed for cause by the Provincial Governor of Cavite:  Provided, That at any time existing conditions may warrant, the Board may change the purpose and procedure of selecting the board members mentioned in this paragraph.

 

(e)      Auditor.  – The Provincial Auditor of Cavite, who is hereby designated as ex officio Auditor of the Cavite Electricity Distributing Authority, shall be the representative of the Auditor General.  He shall be the chief of its auditing and accounting department.  He shall audit, examine and settle all accounts of the Cavite Electricity Distributing Authority according to existing law and regulations, and shall perform such other duties as the Auditor General or the Board may require of him from time to time.

 

(f)       Other officers and employees of the Authority.  – All other officers and employees of the Authority shall be appointed by the Chairman-General Manager with the approval of the Board, subject to the Civil Service Law and Rules.

 

The employees of the Auditor’s office shall be appointed by the Auditor General, who, with the approval of the Board, shall fix the number and salaries of said employees.

 

No appointment under paragraph (f) shall be considered permanent until after one year from the date of appointment.

 

The Chairman-General Manager, Board Member-Chief Engineer and Board Member-Treasurer of the Cavite Electricity Distributing Authority shall each receive an annual salary which shall be fixed by the Board with the approval of the Provincial Governor of Cavite and the Secretary of Finance.  The two Board Members representing the consumers and the Auditor shall be entitled to collect per diem and transportation expenses incurred in connection with their functions with the Authority.

 

SEC. 4.  First meeting of the Board; quorum; votes necessary, in general, for adoption of resolutions; Secretary of the Board and his salary; annual reports.  – The Chairman of the Board shall, immediately after the formation thereof, fix a time and place for the first meeting, at which the Board shall adopt rules of procedure and fix a time and place for holding regular meetings.

 

Not less three members of the Board shall constitute a quorum for the transaction of business, and three affirmative votes shall be necessary for the adoption of any resolution or motion, except as herein otherwise provided.

 

The Board shall appoint its secretary and fix his salary.

 

The Board shall render annual reports of the Provincial Governor of Cavite, the Public Utilities Commission, the National Power Corporation and the Rehabilitation Finance Corporation.

 

SEC. 5.  Resolution to issue bonds, debentures, securities and collaterals and incur other obligations.  – Whenever the Board may deem it necessary for the Authority to incur indebtedness or issue bonds, debentures, securities and collaterals, it shall by resolution so declare and state the purpose for which the proposed debt is to be incurred and the condition of the bonds, debentures, securities and collaterals; which resolution, however, shall be subject to the approval of the Provincial Governor and the Secretary of Finance.  These bonds and other obligations shall be redeemable at the pleasure of the Board after ten years from date of issue; payable forty years after date of issue, and shall bear such interest as may be fixed by the Secretary of Finance; and shall be in registered form and transferable at the Office of the National Treasurer.  The said bonds are hereby declared exempt from taxation by the Government of the Republic of the Philippines, or by any authority, branch, division or political subdivision thereof, which fact shall be stated upon the face of said bonds.  The bonds shall be receivable as security in any transaction with the Government of the Republic of the Philippines in which such security is required.

 

A sinking fund shall be created for the payment of the bonds issued under the provisions of this Act in such manner that the total amount thereof on each annual due date of the bonds issued shall be equal to the total of annuity of such a sum for each million pesos of the bonds outstanding that, together with interest at a rate to be determined by the Secretary of Finance, shall be sufficient to retire the bonds at maturity.  The sinking fund shall be under the custody of the Central Bank of the Philippines, which shall invest the same in such manner as the Monetary Board and the Secretary of Finance may approve in accordance with Act Numbered Three thousand fourteen, and shall credit to the same the interest on investment and other incomes accruing to it.


The Government of the Republic of the Philippines hereby guarantees the payment by the Cavite Electricity Distributing Authority of both the principal and the interest of the bonds issued by said Authority by virtue of this Act, and shall pay such principal and interest in case the said Authority fails to do so; and there are hereby authorized to be appropriated, out of any fund in the National Treasury not otherwise appropriated, the sums necessary to make the payments guaranteed by this Act:  Provided, That the sums so paid by the Government of the Republic of the Philippines shall be refunded by the Cavite Electricity Distributing Authority, and if said Authority fails to refund the same within thirty days after such payment has been made by the Government of the Republic of the Philippines, the National Treasurer is hereby authorized and directed to retain out of the revenues of the provinces, cities and municipalities included in the Authority, that may come into his possession as belonging to said provinces, cities and municipalities, the sum necessary to refund the payments made by the Government of the Republic of the Philippines in any proportion which the Auditor General may approve and which will insure their collection.

 

SEC. 6.  Acquisition by the Cavite Electricity Distributing Authority of franchises and serviceable equipment of electric operators.  – Upon resolution of the Board of Directors and approval by the Provincial Governor of Cavite, the Cavite Electricity Distributing Authority may acquire by purchase all serviceable equipment and franchises of electric operators within the zone of jurisdiction of the Authority.

 

SEC. 7.  Fixing, charging and collection of rates.  – The Cavite Electricity Distributing Authority is hereby authorized to fix, charge and collect rates for all services rendered in each sector, city, municipality, or group of consumers, whether to any person, corporation, firm, government body, municipal entity or religious or charitable institutions, subject to review by the Public Utilities Commission.

 

The Authority shall exist as an independent agency of the Government under the Office of the Provincial Governor of Cavite for administrative purposes.

 

SEC. 8.  Tenure of Authorization.  – The duration of authorization granted to the Cavite Electricity Distributing Authority granted under this Act shall be for a period of fifty years computed from the date of approval of this Act.

 

SEC. 9.  Exemption from payment of all taxes.  – The Cavite Electricity Distributing Authority shall be exempt from all taxes incidental to its operation except as herein provided for.

 

SEC. 10.  Letting of contracts for public works of the Authority.  – All construction and repair works authorized by the Authority involving an estimated cost of ten thousand pesos or more shall be let by the General Manager with the approval of the Board of Directors to contract under the usual bidding procedure of the Government, except in the case of construction or repair of distribution systems, and such other projects which, in the discretion of the Board, due to its urgent nature, shall be undertaken by the Authority by administration.

 

SEC. 11.  Repeal or modification.  – The public interest so requiring, all acts, executive orders, administrative orders, proclamations and municipal ordinances or parts thereof inconsistent with any of the provisions of this Act are hereby repealed or modified accordingly.

 

SEC. 12.  Effective date of this Act.  – This Act shall take effect upon its approval.

 

Enacted without Executive Approval, June 23, 1957

 

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