EXECUTIVE ORDER NO. 62
EXECUTIVE ORDER NO. 62 -
PRESCRIBING POLICIES AND GUIDELINES TO IMPLEMENT REPUBLIC ACT NO. 7227
WHEREAS, Republic Act No. 7227, otherwise
known as the Bases Conversion and Development Act of 1992 (Act),
creates the Bases Conversion and Development Authority (BCDA) and
defines its powers and functions;
WHEREAS, the Act also creates the Subic Bay Metropolitan Authority
(SBMA) and stipulates that the BCDA may create subsidiaries, joint
ventures, authorities, and special economic zones in implementing the
conversion program;
WHEREAS, the National Government is committed to the alleviation of
poverty and the further empowerment of the people to be carried out
under the Medium Term Philippine Development Plan (1993-1998) which
emphasizes national unification, sustained economic growth, accelerated
infrastructure development, protection of the environment, and
streamlining of the bureaucracy;
WHEREAS, responsive policy guidelines are needed to clarify the
oversight and management functions of the BCDA in relation with the
subsidiaries and attached authorities;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the
Philippines, by virtue of the powers vested in me by law, and upon
recommendation of the Chairman of the BCDA, do hereby order the
adoption and implementation of the following policies and guidelines:
Section 1. Policy Framework. — The BCDA shall be
guided by the following policy framework in its conversion program:
1.1
The primary objective of the conversion program is to create immediate
employment and livelihood opportunities utilizing existing world class
infrastructure and support facilities in the reverted baselands in line
with the national government objective of poverty alleviation and
sustained economic recovery and growth;
1.2 The
preparation and implementation of conversion development plans shall be
undertaken with the active and meaningful participation of the private
sector, including non-governmental and peoples organizations, and
affected local communities;
1.3 The BCDA
shall adopt investor-friendly policies, rules and regulations and
create an efficient business environment with no or minimum
bureaucratic red tape to attract local and foreign investments;
1.4 The BCDA
shall plan and implement fund generating projects which will maximize
the use of the military camps in Metro Manila that shall be sold
pursuant to Sec. 8 of the Act with the funds generated therefrom to
be strictly utilized as provided for in the Act; and
1.5 Conversion
projects must be financially self-sustaining in the long term and
should contribute significantly to national economic development.
Sec. 2. Purposes of the BCDA. — As provided in
Sec. 4 of the Act, the BCDA shall have the following purposes:
2.1
Own, hold and administer the reverted baselands and the portions of
Metro Manila military camps transferred to it, and adopt, prepare and
implement a comprehensive and detailed development program for its
subsidiaries and attached authorities in consonance with the following
directional plans:
2.1.1
Subic Naval Base — To be developed as a special economic and free-port
zone ensuring the free flow of goods and capital in accordance with
prescribed rules, to generate employment opportunities in and around
the zone, and to attract and promote productive local and foreign
investments. The Subic Special Economic and Free-port Zone shall be
developed, operated, administered, and managed by the SBMA;
2.1.2 Clark
Air Base. — To be developed as a special economic zone with such
incentives and privileges granted the Subic Special Economic and
Free-port Zone and Export Processing Zones. The Clark Special Economic
Zone (CSEZ) shall form part of the growth triad connecting with Subic
and Metro Manila as a buffer to in-migration to the metropolis. The
CSEZ is envisioned as a new industrial townsite and a major civil
aviation comp for international passenger and/or cargo;
2.1.3 Camp
John Hay — To be preserved, maintained, enhanced and developed as a
forest watershed and tourist destination. The natural attributes and
character of the Camp shall be maintained. The facilities shall be
developed with the expertise of the private sector to maximize its
potential for both local and foreign tourism;
2.1.4 Other
Baselands. The Wallace Air Station, O’Donnel Transmitter Station, San
Miguel Naval Communication Station, and Mt. Sta. Rita Station shall be
developed in accordance with its best land use and the national
concerns as stated in the Act and as may be determined by the President
in line with national priorities;
2.1.5 Other
Special Economic Zones — To create, develop and manage other special
economic zones covering the municipalities of Morong, Hermosa,
Dinalupihan in Bataan and Castillejos, San Antonio and San Marcelino in
Zambales subject to economic viability studies; and
2.1.6 Metro
Manila Military Camps — To develop and/or dispose of portions of the
military camps transferred to the BCDA for other productive uses to
generate funds for base conversion, military housing and military
modernization. The timetable of disposition and conversion of Metro
Manila camps shall be approved by the President of the Philippines in
close coordination with the Department of National Defense and the
Armed Forces of the Philippines;
2.2
Encourage the active and meaningful participation of the private sector
in financing, managing and overseeing conversion projects, particularly
in Clark and Subic;
2.3 Establish
a mechanism of coordination with the appropriate local government units
to effect meaningful consultation with communities affected by the
conversion plans and projects;
2.4 Serve as
the holding company of subsidiary companies, to coordinate attached
authorities, invest in special economic zones, and manage and operate
development projects through private sector companies; and
2.5 Plan and
undertake the readjustment, relocation or resettlement of population
within the baselands and their extensions, particularly the affected
military personnel, in coordination with appropriate local government
units and government agencies, particularly the Department of National
Defense and the Armed Forces of the Philippines.
Sec. 3. Subsidiaries and Attached Authorities. —
The BCDA shall have the power to form, establish, organize and maintain
subsidiary corporation(s) pursuant to Section 16 of the Act.
In accordance with Section 14(a) of the Act, the BCDA shall exercise
oversight function over the SMBA.
To perform its oversight function over subsidiaries, attached
authorities and special economic zones declared under the Act,
including SMBA, the BCDA shall adopt and implement an effective
oversight mechanism to encourage efficient utilization of scarce
government resources and to ensure that plans and programs of
subsidiaries, attached authorities and special economic zones are
proceeding according to national goals and objectives.
3.1
Governing Board of Directors — The subsidiaries and attached
authorities shall be governed by their respective policy making Board
of Directors which shall perform the following, subject to existing
laws and regulations:
3.1.1
Approve corporate plans and programs consistent with the policy
directions of the BCDA;
3.1.2 Approve
and adopt internal administrative and operating rules and regulations
for implementation by the officials and management of the subsidiary or
attached authority;
3.1.3
Establish financial and operations performance targets for management
as basis for evaluating and monitoring corporate performance;
3.1.4
Determine the organizational structure, define the duties and
responsibilities of all officials, and adopt a pay plan and position
classification;
3.1.5 Appoint
all officials down to the third level and authorize the President of
the subsidiary or attached authority to appoint all others: Provided
that, all appointments shall be on the basis of merit, experience,
integrity and fitness;
3.1.6 Prepare
and approve the annual and supplemental budget of the subsidiary or
attached authority;
3.1.7 Approve
capital expenditures and investments program, all forms of
indebtedness, substantial sales, transfers and alienation of assets and
properties of the subsidiary or attached authority;
3.1.8 Require
management to periodically submit to the Board such management reports
as may be required by it to include, among others, the following:
annual budgets, organization, personnel plantilla and programs, report
of operations, infrastructure programs and major capital investment
programs;
3.1.9 Develop
and implement a privatization, commercialization and/or divestment
program of all its major assets and facilities within two (2) years
from start of operation; Provided that, by the fourth year of full
operation, a privatization or divestment program shall have been in
place; and
3.1.10 Submit
to the BCDA a copy of its management reports to include, among others,
the following: annual budgets, organization, personnel, report of
operations, infrastructure program and capital investment program, and
any other reports which the BCDA may require.
3.2
Organization — Organization of subsidiaries or attached authorities
shall have the following common features, subject to existing laws and
regulations:
3.2.1
The powers and functions of the subsidiaries or attached authorities of
the BCDA shall be exercised by their respective Board of Directors to
be appointed by the President of the Philippines upon recommendation of
the Chairman of the BCDA. The Board shall be composed of a minimum of
seven (7) members who being trustees of the Government, may be removed
at any time by the President;
3.2.2 The
governing Board of each subsidiary and attached authority shall approve
the annual budget, plans and program organization, and personnel
plantilla of the subsidiary or authority during an annual planning
workshop with the management committee;
3.2.3 The
Chairman of the Board shall be the Chief Executive Officer of the
subsidiary or attached authority who shall be responsible for ensuring
that the plans and programs shall be directed towards the attainment of
the corporate goals and objectives;
3.2.4 The Board shall appoint a Chief Operating
Officer who shall be responsible for the day-to-day operations of the
subsidiary or authority;
3.2.5 A Chief
Financial Officer shall be appointed to be responsible for ensuring the
efficient allocation and use of financial resources and promoting
financial discipline in the subsidiary or authority;
3.2.6 The
Board shall create a management committee reporting directly to the
Chief Executive Officer which shall assist in planning and monitoring
overall corporate performance;
3.2.7 A Pay
Plan and Position Classification shall be adopted which shall include
the job descriptions and position qualification standards. Appointment
to positions shall be based on merit, experience, and fitness, and must
meet the minimum qualification standards prescribed for the position
being appointed to; and
3.2.8 The
number of personnel shall be kept to a minimum to effect a lean,
efficient and professional organization.
3.3.
Operations and Financial Policies — To promote efficient allocation and
use of government resources and to instill financial discipline in
subsidiaries and attached authorities, the BCDA hereby adopts the
following operations and financial policy guidelines:
3.3.1
The BCDA shall provide standard corporate planning models which will
give subsidiaries and attached authorities sufficient operational
fibility. In the formulation of the corporate plans and programs, the
subsidiary or attached authority shall be guided by the performance
indicators and targets agreed upon with the BCDA;
3.3.2. The
BCDA shall establish with the concurrence of the attached subsidiaries
and authorities, performance criteria, standards and targets and
conduct periodic review and appraisal of performance in accordance with
such agreed criteria, performance indicators and targets;
3.3.3 The
governing Boards of subsidiaries and attached authorities are
authorized to enter into contracts involving not more than fifty
million pesos (P50M);
Unless otherwise provided, the
governing Board shall determine the levels of approving authority to be
delegated to its corporate officers.
The levels of authority on
approval of government contracts provided for in Executive Order No.
380 (November 27, 1989) or other laws and regulations that may
hereafter be promulgated shall apply to contracts exceeding fifty
million pesos (P50M);
3.3.4 The
governing Boards of the subsidiaries or attached authorities shall
require its management to submit the following minimum required
financial reports:
Particulars
Submission Submission
Frequency Deadline
Statement of Monthly
Actual Monthly 45th day after end of
Financial Operations reported month.
3 Year Projection of
Annual Annually June 30 of year
Financial
Operations
preceding the
projected period.
Schedule of Monthly
Actual Monthly 45th day after end of
Net External and
Domestic
reported month.
Financing
3 Year Projection of
Annual Annually June 30 of
year
Capital Expenditure
Projects
preceding the
projected period.
Quarterly Financial
Quarterly 45th day after end of
Statements
reported quarter.
Corporate Annual
Report
Annually June 30 of year
succeeding the
monitored
year.
A copy of these financial
reports shall also be submitted to the BCDA to assist it in performing
its oversight function;
3.3.5
Conversion projects must achieve specific objectives, must have
realistic and quantifiable targets and time-bound;
3.3.6 A
Performance Agreement shall be entered into by and between the Chief
Executive Officer of the subsidiary or attached authority with the BCDA
embodying the performance criteria and target for the year and the
desired goals of the succeeding years as worked out and agreed upon by
the subsidiary or authority and the BCDA; and
3.3.7
The BCDA shall conduct at least a semi-annual review of
operations of the subsidiary or attached authority in relation to
established criteria and agreed performance targets.
Sec. 4. Privatization. — The BCDA hereby adopts
the following policy guidelines in pursuing privatization,
commercialization or divestment projects:
4.1
Privatization shall be the basic thrust of the conversion and
development of the baselands. Privatization of modes shall include,
among others, leasing, joint ventures, management contract,
build-operate-transfer (BOT) and its variants;
4.2
Subsidiaries and attached authorities shall, unless specifically
created for the purpose, inhibit themselves from directly operating any
business activity and shall basically function as the
overseer/administrator/regulatory body over the baselands/facility they
administered;
4.3 As a
general rule, the privatization process should be conducted through
public bidding. However, in the exigency of public service and national
interest, and consonant with existing laws, rules and regulations on
negotiated contracts, simplified bidding through sealed canvass of at
least three (3) pre-qualified investors, or direct negotiation, may be
resorted to. The process of selecting the prospective lessees and
private investors shall be transparent, where procedures and selection
process adapted are made public through newspaper advertisements and
similar other means;
4.4 Where
necessary and justifiable, subsidiaries and attached authorities with
the approval of the BCDA, may establish subsidiaries and/or joint
venture firms to undertake specific business activities such as
utilities and ports which the private sector is reluctant to undertake
or participate or when public interest so dictates;
4.5 All
negotiated privatization transactions, including leasing, joint venture
or sales, shall be in conformity with policies approved by the
President of the Philippines;
4.6
Prospective lessees, partners and third party principals shall be
chosen based on a selection criteria which shall consider experience,
performance track record, financial capability, good credit standing,
technical expertise, reputation and industry accreditation, among
others. Minimum acceptable selection standards shall be established by
the governing Board of the subsidiary attached authority;
4.7 Subject to
the provisions of applicable laws, rules and regulations, investment
bankers, financial advisors and technical consultants may be hired
through a short listing-bidding process to prepare and execute plans
and programs for fund generations, privatizations or divestment of
assets and facilities and other investment and merchant banking
requirements of the subsidiaries and attached operating authorities;
4.8 All
privatization agreements and contracts shall be signed by the Chief
Executive Officer upon being authorized by the Board;
4.9 Leasing of
facilities by subsidiaries and attached authorities shall be governed
by the following guidelines:
4.9.1
As a general rule, lease agreements affecting baselands properties and
facilities shall be executed after a public bidding process. However,
in special cases, and consonant with existing laws, rules and
regulations on negotiated contracts, leasing may be done through sealed
canvass of at least three (3) prequalified potential lessees, or
through direct negotiation, in conformity with policies approved by the
President of the Philippines;
4.9.2 Lease
agreements may be on short-term or long-term basis but not to exceed 25
years subject to renewal for another 25 years;
4.9.3 The
leasing procedures, standards rates, lease terms and conditions shall
be approved by the governing Board of the subsidiary or attached
authority; and
4.9.4 Unless
otherwise authorized, lease contracts shall be signed by the Chief
Executive Officer representing the Board of Directors of the subsidiary
or attached authority.
Sec. 5. Security Arrangements. — As a general
rule, subsidiaries and attached authorities should engage the services
of private security agencies to secure the facilities and assets that
are to be privatized and preserved. Organic security personnel shall be
retained only for the purpose of supervising and monitoring the
activities of contracted private security guards and to liaise with the
enforcement responsibility.
Heads of subsidiaries should secure the full assistance and
participation of local government units, government agencies, and
non-government and peoples organizations to preserve and protect the
properties and natural resources within the military reservations and
extensions from damage and deterioration.
Sec. 6. Environment. — A permanent total log ban
shall be applied in all military reservations and extensions which
shall allow supervised cuttings to prevent forest fires compatible with
judicious management of the forest. These cuttings shall require prior
approval of the operating authority or subsidiary tasked to manage the
facility and/or area.
Environmental impact assessment studies shall be required of all major
projects which could affect the environment.
Environmental standards shall be strictly enforced by subsidiaries and
attached authorities in their respective areas of responsibility.
Sec. 7. Departments, Bureaus, Agencies and
Instrumentalities. — All heads of government departments, bureaus,
offices, agencies and instrumentalities are directed to facilitate the
necessary approvals and assist the BCDA to expedite the implementation
of the various projects and activities of the conversion program.
Sec. 8. Effectivity. — These implementing policies
and guidelines shall take effect immediately upon approval.
DONE in the City of Manila,
this 27th day of February in the year of Our Lord, Nineteen Hundred and
Ninety-Three.
chanrobles virtual law library
Back to Main
chan
robles virtual law library
Since 19.07.98.