Executive Order No. 37

 

 

RESTATING THE PRIVATIZATION POLICY OF THE GOVERNMENT

 

WHEREAS, Proclamation No. 50, s. 1986, launched a program for the disposition and privatization of government corporations and/or the assets thereof and created the Committee on Privatization (COP) and the Asset Privatization Trust (APT). 

 

WHEREAS, Republic Act No. 7181, s. 1992, extended the life of the COP and APT from December 8, 1991 up to December 31, 1993; 

 

WHEREAS, Administrative Order Nos. 8 and 9, s. 1992, directed the identification of idle government properties and recommend to the President an action plan for the disposition of such properties;

 

WHEREAS, 122 government-owned or -controlled corporations (GOCCs) were approved for privatization while 179 GOCCs were identified for retention, abolition, regularization or other dispositive modes;

 

WHEREAS, of the 122 GOCCs for privatization, 72 GOCCs were privatized/disposed as of September 30, 1992 generating gross sales proceeds of P 22 billion;

 

WHEREAS, 399 transferred assets were entrusted to APT for disposition, of which 288 were privatized/disposed as of September 30, 1992, generating gross sales proceeds of P 31 billion;

 

WHEREAS, the privatization program has proven successful and beneficial to the economy in terms of expanding private economic activity, improving investment climate, broadening ownership base and developing capital markets, and generating substantial revenues for priority government expenditures;

 

WHEREAS, there is still such potential for harnessing private initiative to undertake in behalf of government certain activities which can be more effectively and efficiently undertaken by the private sector;

 

NOW, THEREFORE, I, FIDEL V.  RAMOS, President of the Philippines, by virtue of the powers vested in me by law, do hereby order:

 

SECTION 1.  Restatement of Policy.  – The National Government hereby reaffirms its privatization policy to promote an orderly, coordinated and efficient program for the privatization of government entities, assets or activities which are better managed, undertaken or owned by the private sector. 

 

SEC. 2.  Privatization of GOCCs Approved for Disposition.  – Pursuant to the principles provided in Proclamation No. 50, s. 1986, the COP designated disposition entities shall submit to the COP a privatization action plan for all GOCCs approved for divestment as listed in Annex “A” within one month (1) from issuance hereof:  Provided, That said action plan must contain a description of the privatization process to be adopted and a time frame for each step thereof.  Said action plan shall include an offer to sell the company’s shares/assets within five (5) months from its approval by the COP.  

 

SEC. 3.  Review of GOCCs for Retention.  – The Government Corporate Monitoring and Coordinating Committee (GCMCC) shall review the need to retain the GOCCs which were previously approved for retention, including but not limited to those listed in Annex “B” hereof, and submit its recommendation of companies, activities or assets thereof of a second group of GOCCs for privatization, to the COP within two (2) months from issuance hereof. 

 

SEC. 4.  Designation of Disposition Entity.  – The COP shall review the list of disposition entities designated for the privatization of GOCCs and designate another disposition entity, such as the APT or the National Development Company (NDC) if it is necessary for the effective and expeditious privatization of certain GOCCs. 

 

SEC. 5.  Sale of Idle Government Properties.  – The Committees created pursuant to Administrative Order Nos. 8 and 9, s. 1992, shall submit its recommended action plan for the disposition of idle government properties to the President, through the COP, within three (3) months from issuance hereof. 

 

SEC. 6.  Privatization of Other Activities.  – All heads of departments, bureaus, agencies and other government corporations shall identify their assets or activities which may be more efficiently, effectively and economically undertaken by the private sector through such arrangements as sale of physical assets, leasing of assets, management and maintenance contracts or build-operate-transfer (BOT) schemes.  Where these are within their competence, they shall implement such privatization directly.  Where these require actions of the Office of the President or legislation, they shall submit their recommendations to the COP not later than three (3) months from issuance hereof.  Where further assistance is needed, they may consult the COP and avail of grants for technical assistance for privatization, administered by the Department of Finance

 

SEC. 7.  Distribution of Net Proceeds.  – Except for subsidiaries of the Government Service Insurance System and the Social Security System, all GOCCs shall remit to the National Government at least fifty per cent (50%) of the net proceeds derived from the sale of shares of assets effective October 1, 1992.  Net proceeds shall mean gross proceeds less related liabilities and selling expenses. 

 

SEC. 8.  Implementing Rules.  – The COP shall issue the necessary rules and regulations for the implementation of this Order within thirty (30) days from issuance hereof.  

 

SEC. 9.  Effectivity.  – This Order shall take effect immediately. 

 

Done in the City of Manila, this 2nd day of December, in the year of Our Lord, nineteen hundred and ninety-two.

 

 

 

ANNEX “A”
REMAINING GOCCs FOR PRIVATIZATION

 

 

CORPORATION

AREA OF ACTIVITY

ASSET PRODUCTION TRUST

1.      APO Production Unit Inc.

Printing services

2.      Associated Bank

Commercial banking

3.      Basin Dredging and Development Corporation

Dredging and reclamation

4.      Bicolandia Sugar Development Corporation

Sugar milling

5.      East Visayas Agricultural Projects, Inc.

Swine, poultry, farming

6.      Leyte Park Hotels, Inc.

Hotel operations

7.      Northern Foods Corp.

Tomato paste production

8.      Philippine Fruit and Vegetable Industries Inc.

Tomato paste production

9.      Philippine Shipyard Engineering Corp.

Ship repair and fabrication of steel prod.

10.  Philippine Sugar Corporation

Finance, acquisition, rehab/expansion of sugar mills

11.  Phividec Panay Agro-Industrial Corp.

Plantation farming/fertilizer production and trading

12.  Ridge Resort and Convention Center, Inc.

Resort and convention facility mgt.

13.  San Carlos Fruit Corp.

Fruit puree production

DEVELOPMENT BANK OF THE PHILIPPINES

1.      DBP Data Center Inc.

Dev’t.  and mgt.  of DBP computer sys.  and personnel

2.      Philippine Amanah Bank

Commercial banking

DEPARTMENT OF AGRICULTURE

1.      Food Terminal, Inc.

Food, trading, processing, storage, real estate mgt.

2.      Republic Transport and Shipyard Corp.

Sugar terminal and shipyard operation

 DEPARTMENT OF TRANSPORTATION AND COMMUNICATION

1.      Metro Manila Transit Corp.

Passenger bus operation and leasing

2.      Philippine Aerospace Development Corp.

Aircraft mgt., maintenance eng., selling

3.      Philippine Helicopter Services Inc.

Maintenance and overhaul of helicopters

GOVERNMENT SERVICE INSURANCE SYSTEM

1.      Manila Hotel Corporation

Hotel operation and management

2.      Meat Packing Corporation of the Philippines

Meat processing/canning

NATIONAL DEVELOPMENT COMPANY

1.      Batangas Land Company Inc.

Land ownership

2.      GY Real Estate Inc.

Land ownership

3.      Kamayan Realty Corp.

Land ownership

4.      Nadeco Realty Corp.

Land ownership

5.      National Steel Corp.

Steel production

6.      National Trucking and Forwarding Corp.

Trucking, freight of forwarding

7.      NDC-Guthrie Estates, Inc.

Palm oil production

8.      NDC-Guthrie Plantations, Inc.

Palm oil production

9.    Philippine Associated Smelting and Refining   Corp.

Copper smelting and refining

10.  Philippine Phosphate Fertilizer Corp.

Fertilizer production

11.  Philippine Plate Mills Company, Inc.

Manufacturing of steel plates

12.  Philippine Pyrite Corp.

Production of pyrite concentrates

13.  Pinagkaisa Realty Corp.

Land ownership

14.  Refractories Corporation of the Philippines

Production of basic refractories

15.  Semirara Coal Corp.

Coal mining

PRESIDENTIAL MANAGEMENT STAFF

1.      Integrated Food Mills Corp.

Feed production

2.      Marawi Resort Hotel Inc.

Hotel operation

3.      Mindeva Coco-Coir Industries, Inc.

Production of coco-coir fiber product

4.      Mountain Springs Development Corp.

Swine raising

5.      Panaon Prawn Development Corp.

Prawn fry and larvae raising

6.      Shoe Technology Corp.

Footwear manufacturing

PHILIPPINE NATIONAL OIL COMPANY

1.      Filoil Industrial Estates Inc.

Land ownership

2.      Filoil Refinery Corp.

Oil refining

3.      Malangas Coal Corp.

Coal refining Int’l.

4.      PNOC Oil Carriers, Inc.

Oil Tanker operation

NATIONAL IRRIGATION AUTHORITY

1.      NIA-consult, Inc.

Consultancy, mgt. and special services of projects

Source:   Committee on Privatization, October 31, 1992.

 

ANNEX “B”
LIST OF RETAINED GOCCs
As of 31 August 1992

 

NAME OF CORPORATIONS

OFFICE TO W/C ATTACHED

1.      National Food Authority

DA

2.      National Irrigation Administration

DA

3.      National Tobacco Administration

DA

4.      Philippine Coconut Authority

DA

5.      Philippine Fisheries Development Authority

DA

6.      Philippine Rice Research Institute

DA

7.      Quedan and Rural Credit Guarantee Corporation

DA

8.      Sugar Regulatory Administration

DA

9.      National Electrification Administration

DENR

10.  Natural Resource Development Corporation

DENR

11.  Philippine Veterans Assistance Commission

DND

12.  Philippine Veterans Bank

DND

13.  Philippine Veterans Investment Development Corporation

DND

14.  Phividec Industrial Authority

DND

15.  Veterans Federation of the Philippines

DND

16.  Philippine Crop Insurance Corporation

DOF

17.  Philippine Export & Foreign Loan Guarantee Corporation

DOF

18.  Lung Center of the Philippines

DOH

19.  National Kidney Institute

DOH

20.  Philippine Children’s Medical Center

DOH

21.  Philippine Heart Center

DOH

22.  Employees Compensation Commission

DOLE

23.  Philippine Convention & Visitors Corporation

DOT

24.  Philippine Tourism Authority (Including Duty Free Shops, other assets or subsidiaries)

DOT

25.  Light Rail Transit Authority

DOTC

26.  Manila International Airport Authority

DOTC

27.  Philippine National Railways

DOTC

28.  Philippine Ports Authority

DOTC

29.  Postal Service Corporation

DOTC

30.  Local Water Utilities Administration

DPWH

31.  Metropolitan Waterworks & Sewerage System

DPWH

32.  Asean Copper Products, Inc.

DTI

33.  Center for International Trade & Exposition Missions, Inc.

DTI

34.  Cottage Industries Technology Center (Formerly NACIDA)

DTI

35.  Export Processing Zone Authority

DTI

36.  National Development Company

DTI

37.  a.  Manila Gas Corporation

DTI

38.  a.1.  Inter-Island Gas Service, Inc.

DTI

39.  a.2.  Pagkakaisa Gas Storage Corporation

DTI

40.  b.  Philippine International Trading Corporation

DTI

41.  Small Business Guarantee and Finance Corporation

DTI

42.  Home Development Mutual Fund

HUDCC

43.  Home Insurance and Guarantee Corporation

HUDCC

44.  National Home Mortgage Finance Corporation

HUDCC

45.  National Housing Authority

HUDCC

46.  Philippine Deposit Insurance Corporation

NEDA

47.  Philippine Institute for Development Studies

NEDA

48.  Bases Conversion Development Authority

OP

49.  Central Bank of the Philippines

OP

50.  a.  Philippine International Convention Center, Inc.

OP

51.  b.  Private Debt Restructuring & Repayment Corporation

OP

52.  Cultural Center of the Philippines

OP

53.  Development Academy of the Philippines

OP

54.  Development Bank of the Philippines

OP

55.  Government Service Insurance System

OP

56.  Land Bank of the Philippines

OP

57.  a.  LBP Insurance Brokerage, Inc.

OP

58.  b.  LBP Leasing Corporation

OP

59.  c.  Lumang Bayan Realty Development Corporation

OP

60.  d.  Masaganang Sakahan, Inc.

OP

61.  Livelihood Corporation

OP

62.  National Agri-Business Corporation

OP

63.  National Power Corporation

OP

64.  PAGCOR Services, Inc.

OP

65.  People’s Television Network, Inc.

OP

66.  Philippine Center for Economic Development

OP

67.  Philippine National Oil Company

OP

68.  a.  Petron Corporation

OP

69.  b.  Petron Tankers Corporation

OP

70.  c.  Petrophil Tankers Corporation

OP

71.  d.  PNOC Energy Development Corporation

OP

72.  e.  PNOC Exploration Corporation

OP

73.  f.  PNOC Shipping & Transport Corporation

OP

74.  g.  PNOC Tankers Corporation

OP

75.  Philippine Retirement Authority

OP

76.  Public Estates Authority

OP

77.  Social Security System

OP

78.  Southern Philippines Development Authority

OP

79.  Strategic Investment Development Corporation

OP

80.  Subic Bay Metropolitan Authority

OP

81.  Technology & Livelihood Resource Center

OP

 

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