1 month ago
22
ILOILO CITY — The Supreme Court has dismissed a petition for certiorari filed by the Iloilo Electric Cooperatives Inc. (Ilecos), challenging the constitutionality of the law that allowed Razon-led MORE Electric and Power Corp. (MORE Power) to expand its franchise areas.
The Supreme Court, in a decision dated July 30, 2024, but was made available to the public only this year, upheld the enactment of Republic Act (RA) 11918, stating that it was ratified to promote the common good by fostering a competitive environment in Iloilo.
"Ultimately, a franchise is a privilege granted by the State. It is not an exclusive private property of the franchisee and must yield to serve the common good," the decision read.
RA 11918, which took effect on Aug. 30, 2022, amended MORE's franchise to include 15 towns and one city previously within the franchise areas of the Ilecos.
The affected areas include Alimodian, Leganes, Leon, Pavia, San Miguel, Santa Barbara, Passi City, Barotac Nuevo, Dingle, Duenas, Dumangas, New Lucena, San Enrique, Zarraga, Anilao, and Banate.
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In their petition, the Ilecos argued that Section 1 of RA 11918 violated the Constitution as there is no justification rooted in the common good to warrant the alteration of their respective franchises.
They also said it infringes on their right to due process and impairs the obligation of contracts.
The Ilecos asserted that RA 11918 infringes on their exclusive franchises in violation of the National Electrification Administration (NEA) Decree and the Electric Power Industry Reform Act of 2001.
The Supreme Court highlighted that "exclusive franchises are not sanctioned by the Constitution" and that franchises are subject to amendment, alteration, or repeal by Congress when the common good so requires.
The Court also argued that the Constitution prohibits the exclusivity of the franchise and takes precedence over the NEA decree.
"In case of any conflict between the Constitution and a statute, the latter yields to the former because the Constitution is the basic law to which all other laws must conform," it said.
The high court also pointed out that the Ilecos failed to prove that RA 11918 altered the terms of their contracts with power suppliers.
"Neither does the enactment of RA 11918 impose new conditions, dispense with those agreed upon, or withdraw remedies for the enforcement of the rights of the parties in their power supply contracts and/or electric service agreements," it stressed.
The Philippine Rural Electric Cooperatives Association (Philreca), representing 121 electric cooperatives, including the petitioners, sought to intervene in the case, arguing that the law directly impacts its interests.
The Supreme Court also dismissed Philreca's motion to intervene, stating that its interest in the case was not direct or immediate and merely reiterated the arguments raised by the Ilecos.
"Philreca merely reiterated the arguments raised by petitioners. Thus, allowing its intervention will serve no other purpose but delay the resolution of this case," it added.
