Parents and Children: When Law and Technology Unbundle Traditional Identities

examining the intense aspiration of parents and children to attain both liberty and prosperity and how this affects traditional identities and rights within the family

Professor Elizabeth Aguiling-Pangalangan, Holder of the Chief Justice Panganiban Professorial Chair on Liberty and Prosperity delivered her paper – Parents and Children: When Law and Technology Unbundle Traditional Identities – on March 28, 2019 at the 1st Floor Lecture Room, Bocobo Hall, UP Law Center, University of the Philippines – Diliman, Quezon City.

Professor Pangalangan’s paper explores how civil, political, economic, social, and cultural rights impact on women and children in two particular legal situations: adoption and surrogacy. The paper discusses domestic and international laws on adoption and problems that still persist surrounding the adequacy of legal safeguards for the rights of the birth mother, the adopting parents and the child, especially in the context of intercountry adoption. In the subject of surrogacy, there is no Philippine law and international convention regulating it, but neither is there any explicit prohibition against it.

The paper argues that domestic laws did not contemplate the advent of technology that will make assisted reproductive technology possible nor the ease by which people can travel that makes cross border adoption and surrogacy accessible. It seeks to answer the following questions, among others: (1) do Philippine laws defining who are the mother and father of a child applicable in cases of adoption and surrogacy; (2) will a law that allows commercial surrogacy or encourage intercountry adoption not violate the political right to physical integrity of the birth or surrogate mother resulting in the commodification of her womb and her baby, or infringe on the right of every child to a name and nationality; (3) will a law that throws a blanket prohibition on intercountry adoption and international surrogacy agreements not disturb economic and social rights, such as the right to family life of the intending parents, the right to an adequate standard of living and the right to work of the surrogate, and freedom from discrimination of all parties especially the adopted child or the child born of a surrogate; and (4) what changes in the Philippine legal order are necessary to implement the best interest of the child standard, which has animated both legislation and jurisprudence?

The public lecture is the 19th of a series of lectures and debates under the Chief Justice Panganiban Professorial Chairs on Liberty and Prosperity Program. FLP is undertaking this program in partnership with the Metrobank Foundation, Inc. and in cooperation with the Philippine Association of Law Schools. The program aims to encourage educational institutions and law schools to research and propagate at the academe the philosophy of safeguarding the liberty and nurturing the prosperity of our people under the rule of law.

Distinguished guests include retired Chief Justice Artemio V. Panganiban, Court of Appeals Justice Louis P. Acosta, Sandiganbayan Justice Efren N. De La Cruz, Metrobank Corporate Secretary Antonio V. Viray, Dean Fides C. Cordero-Tan of the UP College of Law, Dean Anna D. Abad of Adamson University, Metrobank Foundation Executive Director Nicanor Torres, and Atty. Jannica Robles-Santos of the Court of Tax Appeals Presiding Justice. Apart from the faculty, students from the UP College of Law and other colleges of UP Diliman, Far Eastern University Institute of Law, Ateneo Law School, Pamantasan ng Lungsod ng Maynila, and Manila Tytana Colleges (former Manila Doctors College) attended the lecture.

Professor Pangalangan’s full lecture can be accessed at www.libpros.com, the official website of the FLP.


Professor Elizabeth Aguiling-Pangalangan and retired Chief Justice Artemio V. Panganiban


Opening remarks by Dean Fides Cordero-Tan of UP College of Law 

Professor Elizabeth Aguiling-Pangalangan delivering her lecture


Retired Chief Justice Artemio V. Panganiban delivering his closing remarks

 

28 March 2019
Professor Elizabeth Aguiling-Pangalangan
University of the Philippines-Diliman College of Law
“Parents and Children: When Law and Technology Unbundle Traditional Identities”
(downloadable PDF | presentation)

 

A Remarkable and Riveting Lecture

* Closing remarks of Retired Chief Justice ARTEMIO V. PANGANIBAN after the Lecture of UP Professor Elizabeth Aguiling-Pangalangan, a holder of the CJ Panganiban Professorial Chairs on Liberty and Prosperity, held on March 28, 2019 at the First Floor Lecture Room, Bocobo Hall, UP Law Center, UP Diliman, Quezon City on “Parents and Children: When Law and Technology Unbundle Traditional Identities.”

 

 

Congratulations to Prof. Beth Pangalangan for her impressive, awesome and absorbing lecture. Scholarly prepared and eloquently delivered, it was indeed one of the best lectures I have ever heard in a long time. It makes me want to be a student again to listen again and again to Professor Beth. Ah, to be young again!

Well-research, Indeed!

Of course, her frequent citation of my decisions and separate opinions reminded me of my over 11 years in the Supreme Court. And what especially amazed me is her research into and many quotes from my books, columns and even my speeches. Wow, really heart-warming.

Let me, at this point, hand to her FLP’s check for P100,000 representing her honorarium, less 5 percent withholding tax imposed by the NIRC as amended by the TRAIN Law, and the Certificate attesting to her enrollment as a distinguished Holder of one of the 15 CJ Panganiban Professorial Chairs on Liberty and Prosperity.

May I also thank Dean Fides Cordero Tan for welcoming us to the UP College of Law. I do not remember having encountered her in the past, but her reputation for academic excellence and administrative expertise preceded her. In testimony thereof, the FLP Board of Trustees has unanimously resolved to invite her to join our corps of professorial chair holder. May I therefore have the honor of personally handing to our esteemed Dean Deng our official letter of invitation?

Ambition to Enroll at UP

My appearance here at the UP Lecture Hall reminds me of my life-long ambition to enroll at the UP. My classmates at Mapa High School in the early 1950s (when most of you in the audience were not yet born) and I used to visit the UP Campus in Diliman. Before the UP Oblation, we promised each other that we would study diligently to be able to obtain UP scholarships. And obtain the scholarships we were able to, except that in my case, my impoverished father – who was a simple government employee – could not afford the then 15-centavo bus ride from our small, rented apartment in Sampaloc, Manila to Diliman, Quezon City.

Even though I was not able to enter this school, I continued my association with the UP community, especially with activist student leaders like then UP Student Council President Fernando Lagua and then Philippine Collegian Editor Homobono Adaza with whom I cofounded the National Union of Students, the largest student organization in the country then and now. Because of their activism, Lagua was suspended for one year and Adaza expelled from the University. Looking back, I told myself, “Buti na lang hindi ako nakapasok sa UP, baka expelled din ako.”

My ambition to enjoy UP education was achieved by our only son and one of our four daughters. Our son, Archie, was only the 4th student to graduate Summa Cum Laude from the UP Conservatory of Music. While he proceeded to further piano studies in Munich, he eventually finished a PhD in engineering economic system at Stanford and is now a banker in New York City as an Executive Director of JP Morgan. But while banking is his profession, music remains his passion. Once in a while, he would come back home to give piano concerts in UP as well as in the Cultural Center and other familiar concert venues.

But my frustrated love for UP was requited by then UP President Edgardo Angara who gave me a small replica of the UP Oblation in the early 1980s to thank me for getting a donation of a fire truck from Japan. And my undying thirst for UP’s academic excellence was somehow quenched by my enrollment as an honorary member of the Phi Kappa Phi Honor Society.

A Word About FLP

Before I close, let me say a few words about the Foundation for Liberty and Prosperity, which as already explained by the previous speakers, was organized after I retired from the Supreme Court to promote and perpetuate my philosophy of “Liberty and Prosperity Under the Rule of Law.” FLP has three education programs:

First, the Professorial Chairs for Liberty and Prosperity in partnership with the Metrobank Foundation, with 15 holders now, three of them by UP academics, namely, Professor Pangalangan, Dean Tan and President Danilo Concepcion.

Second, the Law Scholarship Program, in partnership with the Tan Yan Kee Foundation, for junior and senior law students at P200,000 each, covering tuition, books and monthly stipend. We award 20 of them yearly since 2017. We also give additional cash rewards to our scholars who graduate as valedictorians and/or with Latin honors, as well as to bar topnotchers. Among them is UP’s Ervin Fredrick Dy who obtained an FLP scholarship starting in the Academic Year 2016-2017. He took the bar examinations last November. If he or any other FLP scholar cops the first place, FLP will reward him with P200,000 cash. If any of them lands in the second to the tenth places, he or she will receive P100,000 cash.

Third, the Dissertation Writing Contest, in partnership with the Ayala Group. The first place winner last year was former UP student Raphael Pangalangan, the illustrious son of the illustrious couple from UP and Harvard, who got the P300,000 prize and a gold plaque. By the way, the contest is still open for this year. The deadline for entries was postponed to April 30, 2019 at the request of Dean Tan.

May I end these Closing Remarks with my fervent hope for FLP’s closer link and cooperation with the academics and students of the UP College of Law, the best law school in the world…according to the UP Law Alumni Association. Maraming salamat po.

Way to a Happy, Free and Prosperous Society

Remarks delivered by Retired Chief Justice ARTEMIO V. PANGANIBAN in response to the lecture delivered by Joan S. Largo, Dean of the University of San Carlos School of Law and Governance and President of the Philippine Association of Law Schools on October 17, 2018 at the Buttenbruch Hall of the University of San Carlos, Cebu City.

 

Let me begin by saying how amazed I am that just a few days after Dean Joan S. Largo arrived from, to quote her, “a learning visit on clinical education” in the United States, she was ready with a scholarly and authoritative lecture, backed by a PowerPoint, that she just delivered so eloquently before this appreciative audience of the best and brightest legal minds in Cebu.

I thank her and her colleagues in the Philippine Association of Law Schools (PALS), which she now heads, for their support of my philosophy of liberty and prosperity under the rule of law and of my advocacy for a writ of prosperity. With such display of unity in the academe, I believe, in time, we can successfully craft well-vetted “Rules of the Writ of Prosperity” that we can propose for the promulgation of our Supreme Court.

In her lecture, Dean Largo focused on the constitutional provisions on social justice and human rights which the government, particularly the political branches, have not been able to implement and enforce. She emphasized, and rightly so, on the need to arm the least, the last and the lost: the dirt poor, the marginalized and the powerless with a way to compel our government to uplift their plight. She cited the efforts of the highest courts of other countries, like South Africa, Argentina and Columbia, in using their authority to help alleviate the poor’s angst, pain and suffering.

Simple but profound truth

In my response to Dean Largo, let me also cite other countries to drive to home an analogous point, this time no longer a plea for direct assistance or dole-outs in terms of “conditional transfers” of cash, or cheap rice, or communal housing, or socialized medicine.

Taking off from a speech I delivered before the Asean Law Association a few years ago, let me begin with a famous quotation of Dr. Martin Luther King Jr., “If a man does not have a job or an income, he has neither life nor liberty nor the possibility for the pursuit of happiness.” Let me repeat that, “If a man does not have a job or an income, he has neither life nor liberty nor the possibility for the pursuit of happiness.”

It may seem ironic that I should be citing an American civil rights icon in this august audience of patriotic Filipinos, but like Dean Largo who cited foreign jurisprudence to buttress her cause, I did so not because of Dr. King’s nationality, color, gender or religion. I quoted him because of the truth he said so simply yet so profoundly.

I cited him because precisely of my belief that truth is eternal and limitless; that truth is not bound by sovereignty, or territory, or ideology, or legality; that what is true in America is also true in the Philippines, in Africa, in South America and in the world. And that that truth is this: humans need both justice and jobs; freedom and food; ethics and economics; peace and development; liberty and prosperity; these twin beacons must always go together; one is useless without the other.

Now, even in retirement, I still continue my advocacy for these twin beacons of liberty and prosperity. Thus in 2011, five years after my retirement from the judiciary, when I celebrated my 75th birthday, I organized the Foundation for Liberty and Prosperity, which now sponsors several educational programs, namely, 13 professorial chairs in various law schools, 20 full law scholarships at P200,000 each, in which some USC students are recipients, and a dissertation contest, in which a USC student, Tess Marie Tan, won the second place, second only to Raphael Pangalangan, a Filipino graduate student of the University of Oxford in Great Britain, who copped the first place.

To repeat, there are certain truths that transcend sovereignties, territories, ideologies and legalities. And one of those truths is this: The best way to conquer poverty, to create wealth and to share prosperity is to unleash the entrepreneurial genius of people by granting them the freedom and the tools to help themselves and society.

Saving the fisherman    

Let me push my thesis further by quoting a popular adage from Confucius, “Give a man a fish and you feed him for a day. Teach him to fish and you feed him for a lifetime.” Indeed, to save a fisherman from destitution, we must help him learn how to fish more effectively. We must educate him in the skills needed to catch fish more efficiently, assist him in acquiring a boat, allow him the freedom to sail the vast oceans, and teach him the techniques to market the fish he catches.

Sometimes, some of us fear that the fisherman may get lost and die in the storms that batter the seas; or that he may become selfish and would want to own the entire ocean and its vast resources; or that he may become too rich and powerful and metamorphose into a rival, an enemy, or worse, a master. Such fears of possible misjudgments may indeed happen some of the time. Human arrogance, greed and avarice lurk in all undertakings. But they are the exceptions rather than the rule. We must never stop dreaming for fear that reality may shatter our dreams. We must admit that risks and challenges form part of the interesting reality of being human.

On the other hand, I respectfully believe that the goal of governance and of law is to provide guarantees and incentives to help the fisherman prosper, to create the institutions to support him, and to promulgate minimal regulations to prevent him from appropriating all the fishing grounds, from keeping all the earnings to himself and from forgetting his obligation to pay reasonable taxes to the government. Indeed, government must inspire him to share his consequential wealth with the rest of society.

Validating the truth

Let me take you briefly around the world to validate this simple truth. The United States, the most powerful country in the world and the great promoter of liberal democracy, attained affluence because of the pioneers who defied monarchical tyrannies and started a new nation that unleashed the inventive, innovative and entrepreneurial spirit of people like Thomas Edison, Nikola Tesla, Cornelius Vanderbilt, John Rockefeller, Andrew Carnegie, Henry Ford, J.P. Morgan, and lately of Bill Gates and Steve Jobs, as well of great government leaders like Franklin Delano Roosevelt, Dwight Eisenhower and Barack Obama who provided them with the encouragement to attain their dreams and the good governance to contain their greed and share their wealth.

Then, let us go to China, the second most powerful economy in the world and the prime promoter of the communist system. True, Mao Zedong led the masses in a revolt that dislodged the corrupt and inefficient government born of an outdated monarchy. But it was Deng Xiaoping who led this nation to unparalleled economic prosperity by unleashing the entrepreneurial ingenuity of the Chinese under his “One-Country-Two-Systems” philosophy.

Finally, let me bring you to Korea. As a result of World War II, this country was divided into North and South, which unfortunately could not accept their division and engaged in a terrible war that ruined their economies and impoverished their people. Rising from the ruins, South Korea relied on the entrepreneurial spirit of the Korean people and built on their private initiative as well as on the notion that innovation, creativity, freedom and hard work would enable them to conquer their poverty, provide for their family’s well-being and attain affluence.

In contrast, North Korea – despite its technological and military bravado – wallows in abject poverty as a result of its tight grip on creativity and inordinate fear of the entrepreneurship, education, freedom and prosperity of its people.

Entrepreneurship in the Philippines

I believe that given the same climate of free enterprise, our people can rise to the challenges of innovation, creativity and ingenuity and free themselves of extreme poverty, disease, malnutrition and disability. All they need is a government that affords opportunities for education instead of habitual mendicancy, fosters free competition instead of suffocating regulations, and rewards talent and hard work instead of sycophancy and connection.

The best proofs of this assertion are our overseas Filipino workers. Our engineers, technicians and house helps are treasured in Europe and the Middle East. Our professionals, doctors and nurses, succeed much better than many natives in the United States, Canada and Australia. In fact, the average Filipino professionals earn more than the average Caucasians in those countries. Moreover, they are law-abiding, they observe strict traffic rules simply because these rules are enforced evenly and fairly.

Yes, I conclude this response to Dean Largo with the firm belief that if our Filipino brethren are accord liberty, prosperity and the rule of law, they will use their entrepreneurial ingenuity to uplift themselves from destitution, disease and disability. Our responsibility – as leaders of the academe and the legal profession – is how we can harness the rule of law to enable them to form and enjoy a happy, free and prosperous society.

Maraming salamat po.

Wanted Writ of Prosperity

* Transcript of the extemporaneous Closing Remarks delivered by retired Chief Justice ARTEMIO V. PANGANIBAN after the Public Lecture of Polytechnic University of the Philippines Law Dean Gemy Lito L. Festin held on May 12, 2018 at the Bulwagang Bonifacio, A. Mabini Campus, PUP, Anonas Street, Sta. Mesa, Manila.

 

I have three points to share tonight. First, let me congratulate Dean Gemy Lito L. Festin, our featured chair holder of the Chief Justice Panganiban Professorial Chairs on Liberty and Prosperity, for his innovative and well-researched piece titled “Tutelary Rules Principle as Legal Tool for Easing Economic Rights’ Access to Justice in the Philippines.” I think it is one of best lectures I have heard since the Foundation for Liberty and Prosperity (FLP), in cooperation with the Metrobank Foundation (MBF), started this Lecture Series.

Appreciation and Honorarium      

To show our appreciation more concretely and beyond mere words, may I hand over to Dean Festin his honorarium for P100,000, via this check for P90,000; the balance of P10,000 constitute the withholding tax which will be remitted directly to the Bureau of Internal Revenue in accordance with law, and which remittance the good Dean may use when he files and pays for his income tax returns early next year.

So too, may I advise you that Dean Festin’s piece will find a prominent place in the Coffee Table Book that FLP and MBF will be publishing soon to feature our outstanding professorial lectures. This is not an ordinary book. It will be a big multicolored tome that everyone concerned would be happy to place in their living rooms, not just in their libraries.

I also felicitate the three “reactors,” (in the order they spoke) Atty. Rosalie J. De la Cruz-Cada (Deputy Director for Projects of the IBP Center for Legal Aid), Judge Joselito C. Villarosa (of Branch 66, Regional Trial Court of Makati), and Atty. Arnold C. Bayobay (Graft Prosecutor of the Office of the Ombudsman) for their interesting feedbacks and questions. My admiration too goes to Companero Carlos S. Cao Jr., former Labor Undersecretary and POEA Administrator, for being an insightful and funny Master of Ceremonies.

Truth to tell, this is my first time to hear of the word “Tutelary.” Indeed one is never too old to learn. I may be a retired chief justice now at 81 years, but I think I am not “retarded.” One is never too old to learn new treats.

Political vs Economic Rights 

We have always known in law school that most of our economic rights, even those defined in our Constitution, are not self-executing in nature and cannot, by themselves, be the subject of justiciable controversies. To be enforceable, they need enabling legislation. In several decisions, our Supreme Court – citing the deliberations of the Constitutional Commission – has held that economic and social rights cannot, by themselves, be enforced by the judiciary.

This line of decisions finds support in constitutional history, starting from the United States where we adopted our own Constitution. Remember that the more than two-century-old US Constitution was crafted during the American struggle for freedom and independence from British colonial rule when political and civil liberties were the battle cry. And so it is with us. All our basic laws, starting from the Malolos Constitution to the present 1987 Charter, were also drafted at a time when our people fought for political and civil freedom from foreign conquerors, Spanish and American. This is reflected most specially in the Bill of Rights which centered on political and civil rights.

In the present age, while we still treasure our political and civil liberties, our people’s focus is more on their economic needs and wants. This is clear in many recent credible polls and surveys showing that the most urgent concerns of our people relate to poverty, jobs and high prices. They long for liberation from the bondage of poverty. Of what use indeed is the freedom to travel if we cannot fill our stomachs? Of what use is the freedom of information, if we cannot quench our thirst for potable water?

This is why – since I was a student mired in destitution to my professional life as a lawyer and later as I jurist – I have always advocated for justice and jobs, freedom and food, ethics and economics, nay, liberty and prosperity; one is useless without the other. My major decisions starting from Tanada vs. Angara in 1997 have espoused this doctrine. That is why even in retirement, I organized the Foundation for Liberty and Prosperity as a way of celebrating my 75th birthday in 2011.

Writ of Prosperity

In his lecture, Dean Festin ably tackled this jurisprudential difficulty of enforcing economic rights. But he has moved further by proposing a solution – by referring to the “Tutelary Rules” which the Columbian Supreme Court has drawn precisely to enforce economic rights.

I will no longer repeat his many cogent arguments why we must encourage our Supreme Court to follow the Columbian example and promulgate new Rules of Procedure – a power our Constitution has endowed on the Court – to authorize the enforcement of economic rights. But may I add that one good way of doing that is to create the Writ of Prosperity, in the same manner that our Court has promulgated the Writ of Amparo, the Writ of Habeas Data and the Writ of Kalikasan.

The last Writ was issued to provide a legal way to enforce the right to ecology which is arguably an economic right that does not normally find the same traditional constitutional treatment as the self-executing political and civil rights.

May I suggest that Dean Festin take the initiative of bringing this matter to the Philippine Association of Law Schools to the help of his colleagues there in molding this idea and preparing the detailed Rules of Procedure for this new Writ of Prosperity. I am sure PALS President Sedfrey Candelaria of Ateneo would be sympathetic to this proposal.

I am sure also that both the FLP and the Metrobank Foundation will support this endeavor to give birth to the Writ of Prosperity.

May I also suggest that concurrently with the effort to convince the Supreme Court to institute the new Writ, we make a similar endeavor to amend the Constitution to include the right to prosperity and the corollary right against poverty? This would be timely because of the current national effort to amend the Constitution. Again, both the FLP and the MBF, and I personally, would be happy to support this worthwhile venture.

Polytechnic University of the Philippines

The second topic of my closing remarks would be about PUP. I must confess that this is my first time to visit your school. But I do know about it since it was the old Philippine College of Commerce founded in 1901 up to its transformation into a university by a group of avant garde educators led by my activist friend, the late Dr. Nemesio Prudente. PUP is also kind of nostalgic for me, because I located my first law office here in Sta. Mesa, at the Ramon Magsaysay Boulevard very near the vehicular bridge crossing the railroad, less than one kilometer away. Back then, I was intending to run for Congress in this congressional district that includes the University Belt, until the idea was vetoed by my dear wife who did not want any partisan political post for me, or for our children.

To be sure, I am sentimentally attached to PUP, because it was, and still is, the hotbed of activism. Activist student leaders are close to my heart because as you may know, I organized the National Union of Students of the Philippines more than fifty years ago, which was, and still is, the largest student organization in the country. Incidentally, at that time, the Catholic colleges like Ateneo, La Salle, St. Theresa and St. Scholastica did not participate in non-Catholic student organizations. But the NUSP crossed the cloisters and got the collegialas into the mainstream student movements. This historic turn was a bonus for me — it was because of the NUSP that I met the gentle Scholastican, Elenita Carpio, who later became my wife.

I am thus happy that PUP chose to be an active participant in FLP’s programs. Aside from the professorial chair that FLP awarded to Dean Festin, it also awarded full scholarships, including tuition, books and monthly stipends, to three FLP law students, Jun Dexter Rojas, Ma. Vida Malaya Villarico and Rexlyn Anne Evora. They won three of the 21 scholarships awarded for this school year, with only Ateneo de Manila surpassing the count with four. Ms Evora was also chosen as one of the six finalists in the FLP Dissertation Writing Contest.

May I also announce right now that additional cash prizes await them should they graduate with Latin honors? FLP will also award P100,000 to each FLP scholar or dissertation writing contest winner/finalist who make it to the Top Ten in the coming Bar Exam, and double that, or P200,000, for the numero uno.

I have no doubt that PUP graduates are capable of achieving this feat. After all, your bar exam track record is enviable. Your first batch of graduates in 2016 had a 100 percent passing record, while your 2017 grads had an 88.88 passing rate. It is time for you to top Bar Exam this year. I will be there in 2019 to celebrate and hand out FLP’s checks for the Top Ten achievers among our scholars or dissertation winners/finalists.

Why I Am Who I Am

Now, for the third and final topic of my closing remarks. I was very touched by the Invocation that started our program. I was reminded of my speech titled “Why I Am Who I Am Now” delivered in 2007 when I was the guest speaker to celebrate the 200th anniversary of the Canossian Sisters (the speech can be accessed in my personal website, cjpanganiban.com).

By way of backgrounder, like many of you in the audience, and yes, like many of PUP students in general, I belonged to a very poor family when I was young. My father finished only high school and was a government clerk. My mother did not finish elementary school. My father supported not only his four children, of whom I was the youngest, but also his seven siblings who were all younger than him, because his own father passed away even before I was born. As the youngest in our impoverished family, nothing was left for me. I had to sell newspapers, peddle cigarettes amongst jeepney passengers, and shined shoes to support myself. In college, I had to maintain my scholarship and sell textbooks to my classmates to be able to own one as my commission.

I studied in public schools, at Juan Luna Elementary School and Mapa High School. I wanted to enroll at the University of the Philippines for college where I was granted a tuition scholarship as an honor graduate of our high school batch of 1,200. But my impoverished father could not afford the then 15-centavo bus fare from our small rented “entresuelo” in Cataluna Street, Sampaloc, Manila to the UP Diliman Campus. He advised me to enroll instead at the then nearby University of Santo Tomas or Far Eastern University.

At UST, I was interviewed by an old Dominican priest. “So, you want a college scholarship. Since you come from a non-Catholic high school, I will ask you three questions. If you can answer them, I will grant you a scholarship. First, how many Gods are there?” “One,” I readily replied.

“How many persons in one God?” he followed up. “Three,” I gamely answered. Then came the final question, “Name them.” Believe it or not, ladies and gentlemen, I did not know the answer, so I muttered, “Susmariosep!” “Wrong,” he boomed with finality, ending my hope of entering the oldest university in the country. At FEU, I was granted a scholarship without any question, but I had to maintain it with high grades throughout my stay.

That incident I considered as a challenge for me to learn more of my faith. At FEU, I met the chaplain, the late Fr. Michael Nolan, who recruited me to the Student Catholic Action. After college, I continued my Catholic learning, attending many seminars and reading the Holy Bible back to back a few times, plus tens of volumes of commentaries on Catholicism. I embraced the Lord Jesus as my savior and master.

In 1991, I was invited to be a lay member of the Second Plenary Council of the Philippines, where I (together with about 50 Catholic lay leaders) met and dialogued with all the Catholic bishops and leading priests here in forging new regulations to implement the reforms of Vatican II in the Philippines.

My ascent to Catholic leadership was capped by my appointment by the late Pope John Paul II as the only Filipino lay member in 1996-2002 of the Pontifical Council for the Laity based in the Vatican City. This 30-member Council is the highest advisory “dicastery” advising the Pope “on all matters regarding the life of the Catholic faithful worldwide.”

So, from being a Catholic ignoramus who did not know the three persons of the Holy Trinity, I graduated to the highest lay advisory council of the Pope in the Vatican. I relate this story to inspire you, my young friends in the audience, that we should take disappointments and defeats as opportunities and challenges to achieve victory later in life. Poverty and ignorance are not barriers to success. They can be overcome. Looking back, maybe if I were not as poor and as ignorant as I was, I would not have struggled and worked as hard as I did to become “why I am who I am today.”

Maraming salamat po and magandang gabi po sa inyong lahat.

Dean Mikhail Maxino

No Right is inherently superior to another Right

Silliman University College of Law Dean Mikhail Lee L. Maxino’s “Right to Life, Liberty, Property: A Seamless Trilogy to Prosperity” public lecture was the first FLP-sponsored event held in Mindanao. A Master of Laws in Environmental Law (Dalhousie University, Canada) graduate and environmental law expert, Dean Maxino organized his lecture on November 26, 2014—a year after the super typhoon Haiyan/Yolanda devastated the south of the Philippines.

Dean Maxino’s lecture threshed out the principle of indivisibility of human rights, and put forward the main argument that “no right is inherently superior to another; they are all of equal importance.” In other words, a hierarchy of rights would only lead to “prioritized protections”. Thus, the Silliman Dean offered guiding principles: (1) one must respect the importance of rights involved; (2) one must acknowledge the limitation of rights; (3) one must look at the factor that limits a right (only actual burdens on rights trigger conflict); (4) one must understand that the core of a right is more protected than its periphery; and (5) one must consider rights within the the framework of other principles, such as social justice.

Ultimately, the goal is to curb the risk of enabling a select few— the rich, the powerful, or the privileged—to forcefully invoke their liberty and fundamental rights to legitimize their actions that marginalize the less privileged, especially in terms of socio-economic rights.

Quoting Frederick Bastiat, Dean Maxino pointed out that: “Life, liberty and property do not exist because men have made laws. On the contrary, it was that life, liberty and property that existed beforehand that caused men to make laws in the first place.”

He capped his lecture with a statement in reference to the book of Genesis: “In the beginning, God created property, then humans, then bestowed upon them the freedom to use and dominate property, then He exhorted them to multiply, be fruitful, be prosperous. Property, Life, Liberty – one seamless Right on the road to Prosperity.”

“It is curious that God created property first before humans” he added, “He designed property to be humanity’s source of food, even source of life. It is also curious to note that of the values that both the constitutions of the United States and the Philippines so sacredly protect, it is only property–the two being life and liberty– that people cannot be deprived of without due process of law and just compensation.”

Among the dignitaries present were Retired Chief Justice Artemio V. Panganiban and Mr. Nicanor L. Torres, Jr., Executive Director of the Metrobank Foundation.

Dean Maxino was instrumental in the establishment of the Dr. Jovito Salonga Center for Law and Development, an active social-advocacy arm, of the Silliman University College of Law. He has also been extensively involved in critical development projects in the areas of marine and costal resources and protected areas management, funded by international organizations, such as the Asian Development Bank (ADB) and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ).


26 November 2014
Dean Mikhail Lee L. Maxino
Silliman University College of Law (Dumaguete City)

“Right to Life, Liberty, Property: A Seamless Trilogy to Prosperity” (download PDF)

Dean Mikhail Maxino

Dean Mikhail Lee L. Maxino responds to questions from the audience

Will the ASEAN integration help revitalize our legal system?

Dean Joan Sarausos-Largo weighed into current discussions regarding the ASEAN Integration 2015, and expounded on how this regionalization and collective identity building process can ideally foster liberty and prosperity under the rule of law. Delivering a speech in Cebu City on September 11, 2014 , the University of San Carlos (USC) School of Law and Governance Dean captivated an audience comprised of USC law students and faculty, as well as esteemed guests including FLP Chairman and retired Chief Justice Artemio V. Panganiban, retired Chief Justice Hilario G. Davide Jr., President Aniceto M. Sobrepeña of the Metrobank Foundation, FLP President Evelyn T. Dumdum, Department of Trade and Industry (DTI) Representative Glenda Reyes, USC President Fr. Dionisio M. Miranda, SVD, Court of Appeals Cebu Station Executive Justice Gabriel T. Ingles, Mme. Justice Portia Alino- Hormachuelos (newly-elected University of the Visayas Gullas Law School Dean), members of the first and second level courts, officers of the Integrated Bar of the Philippines (IBP), and deans of various law colleges and universities in the Visayas region.

Her lecture entitled “A Glass Half Full: ASEAN Integration 2015 and the Imperative for Reforms in the Legal Profession and the Legal Education in the Philippines” served as a timely reminder that the legal and judicial system must take the opportunities the ASEAN Economic Community will open when its ten member states open their gates in the next 5 years.

Dean Largo highlighted the importance of initiating a national conversation regarding the competencies of the Filipino lawyer, not only in the light of the ASEAN integration but also in keeping up with the global trends of the 21st century. While the changing currents may bring forth new perspectives as well as cross-cultural transformations, Dean Largo strongly emphasized that all the more new policies must remain evidence-based and constantly informed by empirical data and critical thought.

Equally important is the revitalization of the legal education. Her lecture also gave sound insights on how to nurture new lawyers who will ensure that the Filipino nation alongside other Southeast Asian nations will mutually benefit from the ASEAN’s economic and cultural growth.

Named as an Outstanding Graduate of the 500-year old University of San Carlos, Cebu, Dean Largo graduated Class Valedictorian and Magna Cum Laude in Political Science, and Cum Laude in Law, on top of being the Valedictorian of her Law Class. In 2000, she passed the Bar Examinations and was at the top 20 of successful examinees where only sixteen (16%) percent of all candidates passed. At age 28, she was appointed Assistant Law Dean of her Alma Mater’s College of Law. She is the youngest professor in the College to have occupied the administrative post.

Engaged in trial and appellate practice, Dean Largo is a partner at the Florido Largo & Acuña Law Offices.

 


 

11 September 2014
Dean Joan Sarausos-Largo
University of San Carlos School of Law and Governance (Cebu)

“ASEAN Integration 2015 and the Imperative for Reforms
in the Legal Profession and the Legal Education in the Philippines”  (download PDF)

FLP President Evelyn Toledo-Dumdum and USC Dean Joan LargoFLP President Ms. Evelyn Toledo-Dumdum and USC Dean Joan Sarausos-Largo

FLP President Evelyn Toledo-Dumdum
FLP President Ms. Evelyn Toledo-Dumdum delivering her remarks on behalf of the foundation 

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Ms. Glenda Reyes of the Department of Trade and Industry (DTI) and
USAID Trade-Related Assistance for Development (TRADE) Project

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Introducing the Professorial Lecturer

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Response from guests

Related article:
Unleashing Entrepreneurial Ingenuity
by Chief Justice Artemio V. Panganiban (Ret.)

Ateneo School of Law Holds Second Moot Court Competition

To cap his second term as Professorial Chair Holder, Dean Sedfrey M. Candelaria organized “The 2014 Chief Justice Artemio V. Paganiban – Liberty & Prosperity Public International Law Moot Court Competition” from March 4 to 5, 2014 at the Justitia Hall of the Ateneo Law School, Rockwell Center. The debate, which centered on “The State of Asioya v. The Kingdom of Raepinosa: Concerning the Events Related to Dereez and Lexseia” as main topic, was conducted in lieu of a public lecture by the esteemed Dean with the active participation of the St. Thomas More: Society of Advocates.

The championship round (March 5, 2014) was judged by a panelist, with Ambassador Manuel A. J. Teehankee as panel chair, and Ateneo Society of International Law (ASIL) alumni Atty. Jose Lorenzo as well as former ASIL presidents Atty. Pia Alvendia and Philip Dabao as panel members.

Lester Flores and Sang Mee Lee, both from 2B, represented Applicant, the State of Asioya, while Abby Castelo and Paolo Gonzales of 2A represented Respondent, the Kingdom of Raepinosa. The competition ended with 2A bagging Best Memorial and Overall Winner. Paolo Gonzales won Best Speaker for the final round and Alyssa Tan, also from 2A, was awarded Best Speaker for the eliminations. Chief Justice Artemio V. Panganiban and wife Elenita handed the plaques and certificates.

The competition formally closed with Chief Justice Panganiban, FLP Chairman, expressing both his delight over the second round of debates and his hope that more Atenean lawyers will be active in the international law sphere.

Apart from the Foundation for Liberty and Prosperity and Metrobank Foundation cohort, the event welcomed various members of the Ateneo Professional Schools Faculty.

Following the event was a symposium on corruption, which concluded the International Law Week.

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Public International Law Moot Court Competition at the Ateneo Law School’s Justitia Hall

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Mrs. Elenita Panganiban flanked by Chief Justice Panganiban and Dean Candelaria

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The panel of judges led by Ambassador Manuel A.J. Teehanke 

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Awarding ceremonies

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Awarding ceremonies

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Awarding ceremonies

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Dean Candelaria receiving the FLP honorarium from Chief Justice Panganiban


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Chief Justice Panganiban delivering his closing remarks.

   

 

The Unpaid Creditor vs The Distressed Debtor

Chair holder Atty. Nilo T. Divina, youngest Dean of the University of Santo Tomas Faculty of Civil Law and Founder of DivinaLaw, delivered his first lecture on 21 February 2014 at the UST Bar Lecture Room. It was witnessed by retired and incumbent justices and judges, prominent lawyers, bankers and students alike. The event was co-organised by the Philippine Association of Law Schools.

Aptly titled “The Unpaid Creditor vs The Distressed Debtor: Proposals to Balance their Competing Interests”, Dean Divina’s discussion provided the public with insights on banking, lending, and their judicial relevance. His lecture was met with accolades from important guests namely Rev. Fr. Isidro C. Abaño, O.P. (Regent, UST Faculty of Civil Law), Rev. Fr. Richard G. Ang, O.P. (UST Vice-Rector), former UST Faculty of Civil Law Dean Amado L. Dimayuga (now Dean Emeritus),  Mr. Benjamin C. Sevilla (President, Philippine Asset Growth One), Atty. Jose A. Barcelon (Senior Vice President and Head of Legal Services Group, United Coconut Planters Bank), Hon. Ramon Paul L. Hernando (Justice, Court of Appeals), and Mr. Nicanor Torres (Executive Director, Metrobank Foundation). Dean Divina’s lecture was also commended by retired Chief Justice Artemio V. Panganiban (FLP Chairman of the Board).

Dean Divina obtained his Bachelor of Arts in Behavioral Science (Cum Laude) in 1985 and his Bachelor of Laws (Magna Cum Laude, Valedictorian, Rector’s Awardee for Academic Excellence) in 1989, both from the University of Santo Tomas. He started his career in law as the clerk of court of the Regional Trial Court of Pasig City. In 1992, he moved on to become an associate attorney at the Misa Castro & Associates Law Offices. From there, he was appointed as Corporate Secretary of the Philippine Charity Sweepstakes Office (PCSO) where he eventually became its youngest General Manager and Chief Legal Adviser. In 1993, he joined Equitable Bank where he was initially hired as consultant and eventually became Equitable Bank’s youngest Vice President. Upon the merger of Equitable Bank with the Philippine Commercial International Bank (PCIB), the Bank promoted him as its youngest Executive Vice President/Corporate Secretary and General Counsel. Equitable PCI Bank (now Banco De Oro) is the country’s largest bank. In 2006, Dean Divina founded the Divina and Uy Law Offices which is currently the biggest Thomasian law firm in the country with 25 lawyers. Its clientele includes banks, financial institutions, top corporations, various publicly and privately-owned entities, as well as individuals with varied interests.

Dean Divina is the Author of the “Handbook on Commercial Law”.


21 February 2014
Dean Nilo T. Divina
University of Santo Tomas Faculty of Civil Law
“The Unpaid Creditor vs The Distressed Debtor:
Proposals to Balance their Competing Interests”  (download PDF)

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Singing of the Philippine National Anthem

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Mr. Nicanor Torres, Executive Director of the Metrobank Foundation delivering the Welcoming Remarks on behalf of Metrobank Foundation President Mr. Aniceto Sobrepeña

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UST Faculty of Civil Law Dean Emeritus Amado L. Dimayuga introducing the lecturer

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Dean Divina delivering his lecture

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Retired Chief Justice Panganiban delivering the Closing Remarks

Foundation for Liberty and Prosperity

Regulating the Practice of Professions by Foreigners

On 7 February 2014, chair holder Atty. Andres D. Bautista, former Dean of the Far Eastern University Institute of Law and Chairman of the Presidential Commission on Good Government, delivered his first lecture at FEU Makati. His topic entitled “Regulating the Practice of Professions by Foreigners” lengthily weighed the complementary principles of Liberty and Prosperity. According to him, “the ability to practice one’s profession is not only a way to earn a living, it is also a means by which an individual may seek fulfillment, attain self-actualization, and contribute to society.” For foreigners in the country, while they are likewise protected by the country’s bill of rights, “there are certain privileges that can be withheld by the State provided that the exclusion of such privilege is neither unreasonable nor arbitrary”.

The lecture attracted law students from host FEU, as well as from the law schools of Ateneo de Manila University and De La Salle University. He co-founded the Master of Business Administration-Juris Doctor dual degree program of De La Salle Graduate School of Business and FEU. Bautista earned a Bachelor of Science in Legal management degree from Ateneo de Manila University in 1986, a Bachelor of Laws, (Class Valedictorian) from Ateneo Law School in 1990, and a Master of Laws from Harvard Law School in 1993.

Before his appointment to PCGG, Chairman Andy was the Chief Executive Officer of Kuok Group Philippines. He also previously served as a Chairman and President of the Philippine Association of Law Schools, and a partner in an international law firm. He was also a member of Constitutional Reform Commissions under previous administrations.

 


7 February 2014
Dean Andres D. Bautista
Far Eastern University Institute of Law
“Regulating the Practice of Professions by Foreigners”  (download PDF)

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FLP Education Committee Chair and Former Education Secretary
Dr. Edilberto de Jesus delivering a welcoming message

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Dean Andres Bautista delivering his lecture aided by a detailed powerpoint presentation

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Mr. Aniceto M. Sobrepeña (Metrobank Foundation President) conversing with
Retired Chief Justice Artemio V. Panganiban (FLP Chairman of the Board)

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A student posing questions during the open forum

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Awarding of honorarium

Comparative Analysis of the MOA on Ancestral Domain and the Framework Agreement on the Bangsamoro

On his new term as FLP professorial chair holder, Dean Sedfrey M. Candelaria of the Ateneo Law School delivered his second public lecture on November 29, 2013. Presenting a “Comparative Analysis of the Memorandum of Agreement on Ancestral Domain and the Framework Agreement on the Bangsamoro” (view PDF file), Dean Candelaria followed-through the earlier public lecture delivered by Dean Reynaldo U. Agranzamendez (University of the Cordilleras), who focused on indigenous peoples’ rights, ancestral domain claims, and their economic implications.

His lecture attracted a large group of Public International Law students, among others. Demonstrating how his chosen topic is relevant to International law, Dean Candelaria opined that the implications of the two agreements engender not only political repercussions, but economic interests as well. He concluded noting how principles of liberty and prosperity are fundamental in the drafting of the said proposals, affecting not only select communities but the nation as a whole.

The open forum welcomed insightful comments and additional discussions from FLP Education Committee Chair Dr. Edilberto C. de Jesus (also former Philippine Department of Education Secretary and Deputy Commissioner of the Presidential Office of the Peace Commission) and Ateneo Law Professor Atty. Camilo Miguel M. Montesa (also former head of the Peacemaking and Peacekeeping Group in the Office of the Presidential Adviser on the Peace Process or OPAPP).

Apart from Ateneo Law faculty and students, the event was also attended by guests from Metrobank Foundation and the Armed Forces of the Philippines.

Dean Candelaria delivered his first lecture entitled “Finance & Law: Understanding the Institutional and Functional Role of the International Monetary Fund During Sovereign Debt Crisis Situations”  on September 21, 2012. This was commended by the FLP for “setting a high standard” in the FLP professorial lecture series.

Dean Candelaria has an undergraduate degree in Political Science at the Ateneo de Manila University in 1980. In 1984, he graduated from the Ateneo de Manila University School of Law and ranked among the top 20% of the law school graduating batch and received a grade of 83.2% in the 1984 Bar Examinations. In 1986, he left for graduate studies in law at the University of British Columbia (Vancouver, Canada) as a Rotary Foundation Ambassadorial Scholar and was conferred the degree of Master of Laws in the field of Public International Law.

In 2004, Dean Candelaria was appointed by the President of the Republic of the Philippines as a Member of the Negotiating Panel for the Peace Talks with the Communist Party of the Philippines, the New Peoples’ Army and the National Democratic Front of the Philippines (CPP/NPA/NDF). He also chairs the Government of the Republic of the Philippines Monitoring Committee on the Comprehensive Agreement in Respect of Human Rights and International Humanitarian Law.

Dean Candelaria was recently invited to teach at the Master of Laws Program jointly administered by the Supreme Court Philippine Judicial Academy (PHILJA) and the San Beda College Graduate Program in Law.


29 November 2013
Dean Sedfrey M. Candelaria
Ateneo de Manila University School of Law
Comparative Analysis of the Memorandum of Agreement on Ancestral Domain
and the Framework Agreement on the Bangsamoro” (download PDF)

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FLP Education Committee Chair and Former Education Secretary
Dr. Edilberto de Jesus delivering a welcoming message.

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Dean Sedfrey Candelaria introducing his second public lecture

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A slide presentation on the areas in Mindanao covered by the topic

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Ateneo Law students and Dean Sedfrey Candelaria

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A law student asking further questions during the open forum

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Dean Sedfrey Candelaria awarded by Chief Justice Artemio V. Panganiban and
wife Elenita C. Panganiban, together with Dr. Edilberto de Jesus
and Mr. Nicanor Torres (Executive Director, Metrobank Foundation)

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Retired Chief Justice Artemio V. Panganiban
closing the program with a lighthearted message

– –

29 November 2013
Dean Sedfrey M. Candelaria
Ateneo de Manila University School of Law
Comparative Analysis of the Memorandum of Agreement on Ancestral Domain
and the Framework Agreement on the Bangsamoro” (PDF)

photoby _ kristian jeff agustin

The Indigenous Peoples Rights Act: A Vehicle for Liberty & Prosperity

A successful lecture was delivered by Atty. Reynaldo U. Agranzamendez, Dean of the University of the Cordilleras College of Law on October 3, 2013 at the UC Theater, Baguio City. Aside from attracting a number of lawyers, academics and students, his discussion on “The Indigenous Peoples Rights Act (IPRA): A Vehicle for Liberty & Prosperity“ was also witnessed by guests from local government units, NGOs, and indigenous communities, who all gathered and filled the 700-capacity auditorium to standing-room-only, the biggest audience to attend a FLP-sponsored public event since the professorial chairs launching ceremonies held at the Metrobank Auditorium (Metrobank Plaza, Makati City).

His public lecture argued that the essence of Republic Act No. 8371, also known as the Indigenous Peoples Rights Act of 1997, was being eroded by the sale of ancestral lands for which a number of Baguio Ibaloi families now hold CALTs (or certificates of ancestral land titles).

Dean Agranzamendez is the appointed holder of the “Chief Justice Panganiban Professorial Chair on Liberty and Prosperity” for Luzon. A trial lawyer since 1975, Atty. Agranzamendez has handled several cases, among which is the case involving the death of American Peace Corps volunteer Julia Campbell in 2007. He has been the dean of the UC College of Law since 2000 and is a member of the National Conference for the Revision of the Rules of Civil Procedure. He was conferred the Master of Laws degree by San Beda College in June 2013.

A leading law school in the country, the University of the Cordilleras has produced at least 18 Bar topnotchers to date, including the two first-placers (Janet Abuel and Noel Neil Malimban). It is the only law school outside Metro Manila that boasts of producing two Bar first-placers.

Launched on December 20, 2011, the FLP was founded by retired Chief Justice Artemio V. Panganiban along with fellow retired Chief Justice Hilario G. Davide Jr., business icon Washington Sycip, and former UC President and Education Secretary Edilberto C. de Jesus. The FLP aims to “perpetuate the core judicial philosophy of Chief Justice Panganiban that jurists and lawyers should not only safeguard the liberty of the people but must also nurture their prosperity under the rule of law.”

As its first project, 10 professorial chairs were appointed to “conduct original research and delivery of scholarly outputs to advocate the promotion, appreciation, application and protection of the intertwining relationship of liberty and prosperity.” One each from the nine leading law schools in the country and one from the Philippine Judicial Academy were designated and will receive stipends from FLP and co-sponsor Metrobank Foundation.


3 October 2013
Dean Reynaldo U. Agranzamendez
University of the Cordilleras College of Law (Baguio City)
The Indigenous Peoples Rights Act (IPRA): A Vehicle for Liberty & Prosperity” (download PDF)

 

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Dean Agranzamendez delivering his lecture.

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Snapshot of the powerpoint presentation by Dean Agranzamendez

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Closing remarks by Dr. Edilberto de Jesus, former University of the Cordilleras President
and incumbent Foundation for Liberty and Prosperity Trustee (and Education Committee Chair)

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Dr. Edilberto de Jesus also served as  former Secretary of the Department of Education (DepEd).

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Interviews after the program

3 October 2013
Dean Reynaldo U. Agranzamendez
College of Law, University of the Cordilleras
The Indigenous Peoples Rights Act (IPRA): A Vehicle for Liberty & Prosperity“ (PDF)

Should the Economic Provisions of the 1987 Constitution be Amended?

USC versus UST Grand Debate

The University of San Carlos (USC) School of Law and Governance and the University of Santo Tomas (UST) Faculty of Civil Law engaged in a formal debate in Cebu on August 20, 2013. The event was spearheaded by FLP chair holder Atty. Joan Sarausos-Largo, Dean of the USC School of Law and Governance and hosted by the USC, at its CAFA Theatre. With the goal of arguing for or against the amending or removal of the economic restrictions held by the 1987 Philippine Constitution, the main argument tackled House Bill No. 1, which “seeks to revise the pertinent economic provisions of 1987 Philippine Constitution”, as proposed by Feliciano Belmonte, Speaker of the House of Representatives. This House Bill adds the statement “unless otherwise provided by law” as it recognizes the subjectivity of the economy. (Lifted from a related article by Lesley Delos Santos).

The panel from the USC consisted of Mr. Vince Joseph Cesista (speaker on necessity), Mr. Glen Sotto (speaker on beneficiality), Mr. Alvin Clyde Gregorio (speaker on practicability), and Atty. Daryll Bretch Largo (coach). The team argued against the amending of the 1987 Constitution; click to read the Position Paper in PDF.

Arriving safely in Cebu amidst the pounding typhoon Maring and massive flight cancellations in Manila on the same day, the UST was represented by Kim Apple Carvajal (speaker on practicability), Ron Robbie Rosales (speaker on beneficiality), Rolando Asuncion (speaker on necessity), and Ricky De la Cruz (coach). Their group affirmed the proposed revisions to the economic provisions of the 1987 Constitution: click to read the Position Paper in PDF.

Retired Chief Justice Hilario Davide Jr., a Cebuano, witnessed the success of the debate. He delivered the closing remarks on behalf of the Foundation for Liberty and Prosperity, where he serves as an esteemed trustee and chairman of its Governance committee.

President of USC Fr. Dionisio Miranda also graced the event.

 

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Front row (left to right):
USC President Fr. Dionisio Miranda, Retired Chief Justice Hilario G. Davide, Jr.,
and USC Dean Joan Sarausos-Largo.

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Mr. Alvin Clyde Gregorio (USC Debate Team) arguing against the proposition

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UST Debate Team:
Kim Apple Carvajal (practicability speaker), Ron Robbie Rosales (beneficiality speaker),
and Rolando Asuncion (necessity speaker)

Read More: “UST, USC engages in friendly debate”
(20 August 2013 Today’s Carolinian article written by Lesley Cara P. Delos Santos)

Supreme Court Decisions on the Economic Provisions of the Constitution

Incumbent Chancellor of the Philippine Judicial Academy (PhilJA) and retired Supreme Court Justice Adolfo S. Azcuna fulfilled his first commitment to the Foundation for Liberty and Prosperity as a professorial chair holder by delivering his lecture on Thursday, 18 April 2013. Aptly titled “Supreme Court Decisions on the Economic Provisions of the Constitution“, Chancellor Azcuna’s lecture contributed to the Foundation’s goal of trailblazing discussions and debates on the role of the judiciary in economic progress—especially in terms of businesses, investments, jobs, and livelihood. The PhilJA Chancellor was the fourth to deliver the Chief Justice Artemio V. Panganiban Professorial Chairs on Liberty and Prosperity, and the first and only to deliver outside a law school setting. Apart from former Chief Justices Hilario G. Davide, Jr. and Artemio V. Panganiban, the event was attended by retired Supreme Court justices, judges, government officials, lawyers, law school deans, professors, and students alike.

The event was successfully organized by the Philippine Judicial Academy in partnership with the Metrobank Foundation and the Claudio Teehankee Foundation, in cooperation with the Ateneo School of Law in its Rockwell Campus.


Supreme Court Decisions on the Economic Provisions of the Constitution

By Justice Adolfo S. Azcuna
Chancellor, Philippine Judicial Academy

April 18, 2013
Justitia, 4th Floor, Ateneo Professional Schools


Kindly view PDF file:
 Supreme Court Decisions on the Economic Provisions of the Constitution

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FLP’s Trustees Chief Justices Artemio V. Panganiban and Hilario G. Davide, Jr.
with Justice Adolfo S. Azcuna, PhilJA Chancellor and FLP Professorial Chair holder

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Retired Justices Ameurfina A. Melencio-Herrera (PhilJA’s Founding Chancellor)
and Bernardo P. Pardo (MCLE Office Chairperson) gracing the event 

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Retired Justice Pardo delivering the Opening Remarks

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Metrobank Foundation’s President and former Cabinet Secretary
Mr. Aniceto M. Sobrepeña delivering his message of support

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The Ateneo Law School’s Dean Sedfrey M. Candelaria
introducing the lecturer and professorial chair holder

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Retired Justice Azcuna delivering his lecture “Supreme Court Decisions on the
Economic Provisions of the Constitution” and answering engaging questions from the audience

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Acceptance of endowment and token of appreciation (left to right):
Dr. Edilberto De Jesus (Committee Chair and Trustee, FLP), Chief Justice Artemio V. Panganiban (Chairman and Trustee, FLP), Justice Adolfo Azcuna (Chancellor, PhilJA), Mr. Aniceto M. Sobrepeña (President and Trustee, Metrobank Foundation), and 
Dr. Placido L. Mapa, Jr.(Vice Chairman and Trustee, Metrobank Foundation)

Ateneo School of Law Holds Debate

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Spearheaded by Professorial Chair Holder Dean Sedfrey M. Candelaria, the Ateneo Law School held the first ever Chief Justice Artemio V. Panganiban Liberty & Prosperity Debate (Finals) on March 13, 2013 at the Justitia Hall of the Ateneo Law School, Rockwell Center. The debate was conducted in lieu of a formal lecture by Dean Candelaria, and served as an engaging follow-through of his lecture—this time letting the students take the lead in understanding the judicial philosophy of Liberty and Prosperity under the Rule of Law.

The purpose of the debate finals was to thresh out the constitutionality of the  Aurora Pacific Economic Zone and Freeport (APECO)  by arguing for or against the proposition to amend R.A. 9490 otherwise known as the Aurora Special Economic Zone Act of 2007 (Republic Act No. 10083). Debate teams impressed the diverse audience and earned accolades from the Chief Justice himself.

The teams consisted of Block 1-B’s Christopher Reyes, Leo Arman Galang, and Kenneth Varona (Affirmative Side: click to read the Position Paper in PDF); and Block 1-A’s Ponce Lopez, Abby Castelo, and Steffi Sales (Negative Side: click to read the Position Paper in PDF). The former argued the unconstitutionality of R.A. 10083, stressing the negative implications on social justice and human rights, while the latter weighed on the difference between implementation issues as questions of fact and enduring questions of law and justiciable controversies. After more than an hour of energetic exchanges and witty quips between the teams, the judges hailed the negative panel as champion.

The debate was successfully organized in partnership with the St. Thomas More: Society of Advocates of the Ateneo Law School.

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Chief Justice Artemio V. Panganiban Constitutional Law Debate (Finals)
at the Ateneo Law School’s Justitia Hall

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Affirmative opening speaker Mr. Leo Galang of Block 1-B 

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Block 1-A’s Ms. Steffi Sales speaks for the Negative panel

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The Affirmative side listening to the points raised by Ms. Steffi Sales of Block 1-A

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The  panel of judges with ANC Debates champions Mr. Michael Victoriano and Ms. Kristel Tiu

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CJ Panganiban and Dean Candelaria in an engaging conversation during intermission

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Chief Justice Panganiban with wife Elenita C. Panganiban, and Dean Candelaria
awarding “Best Debater” to Ms. Abby Castelo (Negative side)

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Negative panel accepts trophy for championing
the Chief Justice Artemio V. Panganiban Constitutional Law Debate Finals

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The Affirmative side accepts trophy for placing second

(Watch this video introduction courtesy of the St. Thomas More: Society of Advocates)

LINKS:

ATENEO DEBATE Re APECO Position Paper (Affirmative) – PDF

ATENEO DEBATE Re APECO Position Paper (Negative) – PDF

.

The Powerful Judiciary and the Concept of Rule of Law in the Philippines

Dean Joan Largo, University of San Carlos CebuDean Joan Sarausos-Largo of the University of San Carlos, Cebu School of Law and Governance is the youngest and only lady recipient of the Chief Justice Artemio Panganiban Professorial Chair on Liberty and Prosperity. On 6 March 2013, she delivered her first lecture to a big audience composed of students, faculty, legal minds, and businessmen of Cebu at the Albert van Gansewinkel Hall, in fulfillment of her commitment to conduct original research that may help promote the judicial philosophy of Liberty and Prosperity under the Rule of Law.

Aptly titled “The Powerful Judiciary and the Concept of Rule of Law in the Philippines: Correlations, Consequences and Implications”, Dean Largo’s discussion probed highly relevant topics such as (1) Rule of Law in Developed Countries and in Asia; (2) Rule of Law in the Philippines, (3) Judicial Review and Rule of Law; (4) The Expanded Certiorari Jurisdiction of Philippine Courts under the 1987 Constitution; and (5) the Powerful Philippine Court, which opened up a brave discussion on the Supreme Court’s duty to solely decide matters that encompass “grave abuse of discretion”.

Her lecture was warmly commended by former Chief Justices Artemio V. Panganiban, now the FLP Chairman of the Board, and former Chief Justice Hilario G. Davide, Jr. Mr. Anecito Sobrepena, President of the Metrobank Foundation; Mr. Gordon Alan Joseph, President of Cebu Business Club; Mr. Philip Tan, President of Mandaue Chamber of Commerce and Industry; and Mr. Efrain Pelaez, Jr., President of Mactan Chamber of Commerce and Industry also expressed their warm remarks and appreciation. The event was also witnessed by the President of IBP Cebu City Chapter Atty. Earl Bonachita, the President of the IBP Cebu Chapter Atty. Ferdinand Pepito,  USC President Fr. Dionisio Miranda, SVD, and USC Vice President for Academic Affairs Fr. Anthony Salas, SVD, as well as CA Justices and Judges of Cebu, Mandaue, and Lapu-Lapu.

For the coming semester, Dean Largo will be organizing a debate that will thresh out the issue of “how powerful Philippine courts should be in upholding the Rule of Law in the country.” KJCA

 


The Powerful Judiciary and the Concept of Rule of Law in the Philippines:
Correlations, Consequences and Implications

By Dean Joan S. Largo

March 6, 2013
Albert van Gansewinkel Hall, University of San Carlos, Cebu


Kindly view PDF file:
The Powerful Judiciary and Rule of Law in the Philippines

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Outline of Dean Joan Largo’s Lecture and Presentation

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Left to Right:   Mr. Gordon Alan Joseph (President, Cebu Business Club), Mr. Anecito Sobrepena (President, Metrobank Foundation), Fr. Dionisio Miranda, SVD (President, University of San Carlos, Cebu), Retired Chief Justice Artemio V. Panganiban (Chairman, FLP), Retired Chief Justice Hilario G. Davide, Jr. (Head, Governance Committee and Trustee, FLP), and Atty. Daryl Bretch M. Largo (Professor, USC and Dean Joan Largo’s husband).

Retired Chief Justice Artemio V. Panganiban gives his closing remarks during the Professorial Lecture of Dean Joan Largo at the University of San Carlos, Cebu on 6 March 2013.

“Katarungan” as the Filipino Concept of Justice

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Dean Jose Manuel I. Diokno, holder of the “Chief Justice Panganiban Professorial Chair on Liberty and Prosperity” delivered his first lecture entitled “The Philippine Judiciary- Problems and Prospects” on November 5, 2012 at the Natividad Fajardo Hall of the Bro. Andrew Gonzalez Building at the De La Salle University College of Law.

Dean Diokno Discussed the Filipino concept of justice or “katarungan.” From there, he moved into what ails our judicial system and his proposed solutions. Basically, he said that our Rules of Court are based on the American system, which in turn is anchored on jury trial. This latter mode places high wall on trial proceedings so as not to unduly influence the jury members who are not lawyers. In the Philippines however, trials are conducted and decided by judges who are knowledgeable in the law and need not be protected from media hype.

The lecture program included Welcome Remarks by La Salle Vice Law Dean Jocelyn Cruz, a Message from Metrobank Foundation President Aniceto Sobrepeña and Closing Remarks from FLP Chairman and retired Chief Justice Artemio V. Panganiban.

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Enthusiastic Law students at the registration booth

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Welcome remarks by Atty. Jocelyn Cruz, Vice Dean of DLSU College of Law 

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Closing remarks by  retired Chief Justice Artemio V. Panganiban

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Special guests with tokens of appreciation from Dean Diokno and the DLSU College of Law

5 November 2012
Dean Jose Manuel I. Diokno
De La Salle University College of Law
“The Philippine Judiciary: Problems and Prospects” (PDF)

What is the Role of the IMF During Sovereign Debt Crisis Situations?

Finance & Law: Understanding the Institutional and Functional Role
of the International Monetary Fund During Sovereign Debt Crisis Situations

CJ Panganiban Professorial Chair on Liberty and Prosperity

By Dean Sedfrey M. Candelaria

September 19, 2012
Justitia Room, 4th Floor, Ateneo Law School

The Honorable Chief Justice Artemio V. Panganiban, Mrs. Panganiban, the Honorable Chief Justice Hilario G. Davide, Jr., Mr. Aniceto M. Sobrepeña, whom I call with an endearment term Sangko Chito, you’ll have to inquire later on, the two very distinguished Deans and Co-Chairholders Dean Nilo Divina and Dean Andy Bautista, Atty. Vannie Vallente, my very loyal Associate Dean, whom I call my “Sweeper”, my co-faculty and co-workers in the linear of learning, Mrs. Cecil Mejia and Mr. Bulaon, my law students, Ladies and Gentlemen and Friends.

I take this opportunity first of course to congratulate the Foundation for Liberty and Prosperity including Metrobank Foundation for taking up this opportunity to engage the Law Schools. It’s a very timely opportunity for us because it is a time when I think legal education in this country is fast developing. Last year, we had a convocation in legal education where an invitation was sent to various law schools around the country where we discussed the developments in legal education and, in preparation for that convocation sometime last year, we found out that it was almost 30 years ago that the last convocation in legal education was done at the UP Law Center. Thirty years, that made a lot of difference. Today we have a JD Program and most law schools are encouraged in fact, mandated to go to a JD Program. The JD Program was introduced in the Ateneo Law School in 1991. It was a leap of faith, a lit in the dark for us, then Dean Recuardo delos Angeles tried to embark the program within the same cut as the JD Program in the United States. But the JD Program in the Philippines will take a different complexion altogether because of the legal culture, the history and experience of this country. And this is what is very important to define, the legal education and the culture that we need to bring into this conference.

The conference of Liberty and Prosperity is one that perhaps comes close to the experience of citizens right now. As we have listened to Chief Justice Davide’s introduction on Chief Justice Panganiban’s philosophy, it is very much imbedded in our Constitution.

When the subject matter was actually raised to us at the breakfast meeting at the house of Chief Justice Panganiban, that they will launch or do a road show on Liberty and Prosperity, I did not hesitate to volunteer immediately. It is a subject matter that I think that will put this whole discussion into a framework. And I take into account, of course, a standard position of the Supreme Court, “Tañada versus Angara” as a starting point for us Constitutional Law and now on review by the Court here. It’s a landmark decision, not only because it was penned by then Justice Panganiban of course, but it gives us a framework on where our lives are now, in a sense, put into the hands of international economic institutions. Our first initiation, of course into international economic institutions, is the World Trade Organization. And that is where Tañada begins, to initiate us into the set of rules that governs states today, on law governing international finance, trade and even development. The WTO case is very important from the point of view of international law. It affirms a principle that defines automatic application or incorporation if you have probably been answering in exams, the doctrine of incorporation related to Facta Sunta ________.  That obligations must be complied with in good faith.

And that is where I’d like to begin my discussions because it is not very easy to appreciate in a sense the so called role of most of the international organizations today. For one I’ll show you a picture here that says “No to EU Austerity”, “Yes to Democracy”, “No to Privatization”. This is a scene, somewhere in Europe and for anyone who does not perhaps understand the topic in the very first place, we always say it sounds great to me. And this is exactly where I would like to bring you today.

To bring you back towards the cycle of Sovereign Debt Crisis that began. It began in the doors of Europe at one time because it was in fact where the dealing nations began and it took a cycle when the developing country borrowers and today lands back into the heart of the Eurozone. We have countries now in the Eurozone like Greece, Portugal, Ireland, Italy, and mind you Spain, our former Columbian _____ in sovereign debt.

How does this relate in a way to liberty and prosperity? My entry point is a subject matter that’s again very close to my heart. I must admit, Mr. Chief Justice Panganiban that, when I took this lecture assignment, I said, “You have given me an opportunity to refresh what I have, in a way, embarked on more than 25 years ago when I did the graduate research on the sovereign debt problem of developing country borrowers”. But that was the scenario at that time. You had several sovereign debt crisis, financial crisis in Asia in the 90s then you had the slump in the United States that triggered in a way the Eurozone crisis in 2009 to 2011. For a while I’ve had some reflection on this I said “when will I have the opportunity to write another chapter in this original research that I think I may have to circle, put a dot on” and you just gave me the opportunity Mr. Chief Justice and now I am more tempted to embark on a book after this.

So I’d like to begin by giving you a short outline of what  I plan to do. This will now be the start of a more legalish language. Pardon to non-lawyers but I think it’s something I’ll try to put down on the level of a ________ person’s knowledge. Economists would be very very much at home anyway with the language and I’m sure Chito would be comfortable with this.  He will have a lot, in fact, to share on matters of national economic policy making. I’ll try to this understanding the constitutional functional growth of International Monetary Fund during sovereign debt crisis situations.

I’ll begin doing just a little survey of how sovereign debt crisis had actually been with us since time immemorial until we say the Conference of ___________.  It’s been there with us, it will be there to stay. The question is, how do we cope with it? It’s like the floods in Manila, the floods in the regions. And if I may change to say, adaptation. How do we adapt to certain situations. Other  immediable rules right now that can actually be put in place that will deal with the ravages that save on economic disaster or financial crisis. How do we protect people in that context? How do we adapt to the situation? So the second major discussion is where I’d like to spend a little more time working through the history of IMF involvement on sovereign debt renegotiations. I will look at the parallels from the early stages of state insolvency and reaction of the International community to how debtor countries are actually “made to behave”.

In the free World War and the post World War, where the IMF, together with the three grand Breton Woods Institutions that played the role trying to keep the world economy today. And then move towards the new era of crisis. And how I have now would have to actually dealing with certain countries that are very very protective of the sovereign rights such as the Asian Tiger economies, including, of course now Eurozone where you have one of the most sophisticated regional organizations that have reached its pinnacle of integration through a common currency or monetary unit. That perhaps is the heart of any integration of any economy once you reach that level. We have been trying to do that in Asia, an Asian currency unit. We don’t know whether we will see the day when that will come.

The last point will be some conclusions that will make some reference to human rights standards and how we can actually achieve in the context of what we call adjustment progress, respect for fundamental economic rights of people without having to sacrifice civil political rights. The picture I showed you is typical of a reaction of a body politic that will have to undergo austerity programs that is experience of many developing countries in the past. When adjustment programs had to be required for purposes of actually reconstructing economies that are emerging out of what we might call deep financial crisis. It hurts, it hurts to rebuild an economy especially in other situations like transition societies. We have countries, and fortunately, of this for us, we have countries in Sub-Saharan Africa, in Latin America, that experience a string of authoritarian rules, strife, and the question has often been raised or question has often been raised “if a new government emerges, a new state emerges, can that  state actually run out of its obligation, walk away, a bad debtor? You know that for me is very private perspective, from a very personal perspective, that will be very very difficult. You have to be a good debtor, you will no longer get infusion of new funds in the end. And that applies not just on a personal level but even on a state-to-state level. But the temptations are very real for a government that wants to survive for example. Governments rise and fall sometimes in the context of deep economic crisis. And this is what happened to Greece as you know. In an effort to implement certain austerity measures, the first government that had handled it did not survive, a new government have to rise. We have other examples in other parts of the world. So this is what I’d like to begin with.

As a very young lawyer after the bar exam in 1984, I told myself there is something I’d like to really study when I go out there do graduate course. And I said “I want to make sense of what the activists at that time during the Marcos era were saying ‘Down with IMF, down with World Bank, down with WTO, ITO at that time. And I said you know as a lawyer if I want to be engaged in a very fruitful discussion on this matter, I really will feel inadequate unless I really study very well the consequences and the roots of this. I am not an economist by background but the nature of the issue that I had to deal with at that time was very much economic based in United States and for a lawyer, of course, getting into this ground, is like going into the lion’s den, it’s like mathematics. That’s why most of the lawyers they say would want to go to the law school to avoid one plus one. But I said no, I think I will get up anyway. I have the benefit of an economist that, adviser at the time public international law adviser also and a whole set of hopefully disciplinary exposure. And that is the right thing I got my own orientation that when you study law, you just cannot be confined with the technical rules of law. You have to look at the foundation of the law, you have to look at the rationale behind it. And that is where law becomes more meaningful, that is where law actually makes sense in the lives of people, in the lives of the states. Because law is an evolving __________. With that, I now would like to proceed with the introduction of the history of insolvency.

If one were to look at the history of international relations, there are at least very interesting models that we can look at on how the international community have dealt with insolvencies in the past. Very often, people ask can this state really govern? Can a state in a very theoretical and legal sense go broke? We say no, because a state has all the grand powers, it has a power to task, it has to power to generate revenue. However the impact of the citizens is what will make a government think about using such kind of power. For that power has to be reasonably applied. And therefore can a state really go broke? Well, we say yes in the end. That there are countries who are unable to service, for example, its debts, its indeed balance of payment, deficit, then that’s perhaps the situation which we call “getting broke” when you are no longer able to pay your financial obligations.

There was a time in the international communities’ history that the use of force was in fact use to exact contractual debts. Some of the bigger countries at that time had to send their forces. The U.S. would send their marines to actually exact contractual debts of some of the smaller Latin American countries. But the Hague’s Conferences at the turn of the 19th to the 20th Century, banned the use of force to exact contractual debts. And even the United Nations charter already bans the use of force for aggressive purposes. So that was the precise, what was the model during the post-World War I and before World War II. Well, we have Bondholders at that time. And what they did was to negotiate. There were negotiations that happened between the debtor and the private Bondholders at that time. Then of course perhaps the closest you can find that will be equated with a model that will develop after the second World War under the auspices of the International Monetary Fund.

We also have another template that dealt with non-contractual debts but more oblique, obligation like the German model when it had to pay certain debts after the first World War, and it was based on a Treaty. So there was a multilateral arrangement determined to pay its debts through a multilateral model. That again will ring a bell looking at the post World War II situation where a group of creditors for the Paris Club group of creditors would deal on a multilateral level.

And then came the post World War II, and this were ____________ as I said a little more time looking at how the International Monetary Fund had put together a framework to deal with sovereign debtors  particularly developing country borrowers.

The Asian Financial Crisis again is of interest simply because it deal what we call tiger economies this time. Tiger economies in Asia would count Malaysia, you have Thailand, you also have Philippines and Korea, has been one of the fast developing economies in East Asia. Again, we will see how the nations reacted on the let’s say participation in having to settle their properties. And finally, we will end with Europe where I think the latest model we will find in sovereign debt crisis had adapted in a way what the IMF began after the Second World War. But of course with much caution because Europe is a continent that is very proud of its tradition of its independence, as an integrated community. And it will have a bearing on how a model in the Eurozone will actually develop.

So this is what I just want to wrap-up – the first and in the pre-19th Century. These are at least the points that I’d like to deal you with. There is a term for a re-adjustment plan. A debtor state is given an opportunity rather than walking out of its obligation to readjust.

Diplomatic protection, of course, is always made available to private Bondholders. In international law the debts, for example, or obligations of a private citizen for a theoretical entity that actually are owing from the let’s say the state party would actually resort to what we call diplomatic protection. So if you’re a bank, you would want your country to raise that up as an issue with a government that owes you certain obligations. But that is because on an international claim, you are talking of an arrangement that does not have the status of a treaty between two parties.  And therefore, your resort would probably be less of an international remedy. That’s why you will have to resort to diplomatic protection.

As I mentioned, the closest I will find for there might be a so called legal consequence for state for non-compliance with a multilateral financial obligation is to a Treaty Model. Because if you ask the state to sign this settlement in the context of a Treaty, then you will have consequences pursuant to Treaty Law. And if the party fails to comply with that then you can bring that party before the International Tribunal. But this was because during that time, before the Second World War, we did not have, let’s say an integrated world economy where you have institutions like WTO, or World Bank, or IMF, that will actually offer opportunities for dispute settlements before going to an International Tribunal.

Let me move more particularly into the International Monetary Fund including the other economic institutions. Just before the end of the second World War, there were two major countries of course dealing a meeting in Bretonwoods in New Hampshire, that is the United States and England at that time. They led the allied countries to deliberate on how to reconstruct the World Economy after the Second World War. That was a major concern for the two countries. And we will see where the United States on one hand and Britain on the other hand differed on approaches when it came for example, to the use of the International Monetary Fund resources in dealing with deep financial crisis of their members.

Just by background or in deference to “Tañada versus Angara”, it’s good to know that one of the three grand institutions at that time that was intended to govern trade, in the states that’s the exchange of goods and services by providing a set of rules was the International Trade Organization. That did not materialize as we know. The Agreement that govern it, was the general Agreement in Paris and Trade and because at one time the United States did not also favor an ITO at that time. What happened was Secretariat remains to be the governing body for purposes of implementing the general Agreement on Paris and Trade. Later on in the Machist Treaty in the ‘90s, the WTO would enter into Court and you now have a world trade body that has a dispute settlement mechanism.

The other institution that was created during the Second World was the International Bank for Reconstruction and Development (IBRD). The IBRD at that time was really intended to provide assistance to countries rising out of the war and they would need infrastructure development. So World Bank was really conceived as a development institution that will deal in infrastructure, deal with damaged bridges. But World Bank has evolved instead. It even went into matters like the restructure of adjustment loans, and also governance issues has evolved to that time on.  But the International Monetary Fund, in a way, remains stable, and focused in its mandate. It is one that was ________  to govern courts, deregulation of exchange, and money for example would have been the basis of the mandate. It is like a central bank of all central bank this day. That became the function of International Monetary Fund. But when we talk about trade and money, there are two sides of the same coin. Whatever you do on the trade side, will affect the monetary side and vice-versa. So it is very important for WTO and International Monetary Fund, including the World Bank, to coordinate more or less if you want to have a sound global economy. Now the whole intention of the so called Breton woods Institutions was really to provide a set of rules this time that will govern the behavior of states in regards to money and trade. Why? Because they saw that before the Second World War the excesses of nation states without the regulatory framework on an international _________________ that even cause the war. And they said you provide a venue for competition for countries around the world to develop and eventually you would have countries that will be stable and eventually conflict hopefully will not thrive. And in a way if you look at that in the context of financial setting that exactly is the direction that you would want in a country.

When talking about frameworks, what is the economic framework here? That I think is a given at that time. It’s a free-market based economy. But that will become more and more flexible as the national economies developed.  There are certain specifities on a ground level that we have to adapt to a purely free-market based set of principles. So you now have paradigms or models that will talk about developments. How do you pursue development in a market-based situation that will also look at the impact in the most marginalized sectors of a society.

From an international law perspective, and a more legal in approach, we now have a set of rules, treaty-based rules in regard to exchange of goods and services or even your currencies. And so there are things that we just cannot do on a domestic level without having to take into account the impact on other states.

So this is I think one of the most interesting contributions from the point of view of international law and practice. And this is where I’d like to emphasize a little bit more. Now, just looking at the IMF mandate, you look at the paragraph under Article 1, it says and I quote “To facilitate the expansion and balance growth of international trade, and to contribute thereby to the promotion and maintenance of high levels of employment and real income and to the development of the productive resources of all members as primary objectives of economic policy.” That is a provision and I’d like to focus on two very relevant mandates of the IMF that had something to do with the financial obligations of states. There are two provisions I’d like to give emphasis to:  that’s the freedom for payments and external debt service and the use of the Fund’s resources or what we call balance of payments financing in the context of the IMF.

Just a little explanation on a member’s obligation in the IMF. When you become a member of the IMF, you actually contribute a certain sum of money. And, in principle, I may contribute One Peso. Later on, if I would need what we might call balance of payments financing, I maybe allowed to freely draw on an equivalent amounts that I have contributed to the Funds. And, to that extent, a Peso to a Peso there will be no conditions for it. But oftentimes countries would need more than what they have initially contributed and that is where what we call conditionalities come in. And therefore you have to abide by that. I will explain that very technical arrangement later on.

In the case of the mandate of the IMF also, I’d like to mention this very important provision in Article 1 that says “It has the mandate to establish a multilateral system of payments in respect of current transactions between members and the elimination of foreign exchange restrictions which hamper the growth of world trade. Again, if you look at the mandate of the IMF in light of WTO also, the principle is that the lesser government is in, or at least the less restrictions you have to allow the free exchange of goods and services, or in this case the free movements of payments across border, then the better for the world economy.

The other provision it says “To give confidence to members by making the Fund’s resources temporarily available to them under adequate safeguards, thus providing them with opportunity to correct maladjustments in their balance of payments without resorting to measures destructive of national or international prosperity.” Now, as I said it’s very tempting for a state that is experiencing economic crisis to adopt very popular, very popular policies but of course may be economically damaging in the end. So economists would understand this better of course. It hurts, it hurts to recover. There are bitter pills that you have to take on a short term but, hopefully with a long term gain for the economy. And so when you need that breathing space, you are given what we might call a “facility”. You are allowed access to IMF resources, and in very very basic Civil Law of Ireland, that’s a loan anyway, but it’s called a purchase of currency. It’s a very technical again procedure but it really gives a loan and you’re given that window to be able to use up the Funds for a certain period of time, hopefully, to be able to clear your balance of payments deficit within a certain period.

Freedom for Payments and External Debt Service. Now I’d like to follow through on that particular provision on current transactions because there is also a very important provision in Section 2(a), Article VIII of the amended provision of Articles of Agreement where it says “no member shall, without  the approval of the Fund, impose restrictions on the making of payments and transfers for current international transactions.”  And what does the phrase ‘current international transactions’ actually mean? Well, before I move to that I just want to mention that that may refer even your debts, your loans to, in the case of some of the most indebted countries before, to private commercial banks that was the phenomena at one time. So, you cannot impose some of these restrictions you must allow continuous payments.

Now in the case of the Philippines, I just want to flag a case to “Guingona v. Carague’, ‘Senator Guingona and Pimentel’ which challenged the Foreign Borrowing Act of the Philippines at that time which is a carry over from the Marcos administration. It dealt with the automatic debt service. As you know, in every government budget, every year, there is almost always a fraction of the budget that automatically goes to debt service. That has been there for a while and it is not there without any purpose. And it has a lot of bearing to the point of view of external debt service. But the challenge that was made of course on Guingona v. Carague were almost 2, 3-fold. Let me focus on one that said we cannot actually set aside money without a very specific appropriation intended for this. So you have to have some specific sum of money for a particular purpose. Now the automatic debt service according to them is undetermined. For each year, it is almost undetermined because it is not appearing there unless, and if you compute, of course the interest for that year, you will be able to determine. But, until such time, it automatically gets into the Budget.

What was the argument of Senator Guingona and Senator Pimentel? Very interesting, because they referred to another provision of the Constitution that says “highest budgetary priority must be given to education. So in the file, this is what they said. In the file, every year the biggest must be given to education. And so when you have a very high, let’s say percentage of debt service appropriated, that violates the principle of Constitution. Of interest is cap almost by the the Constitution of the Supreme Court. I think it was Justice Limcaoco? at that time where he says “as to whether or not the country should honor its international debt, more specially the enormous amount that has been incurred by the past administration, which appears to be the ultimate objective of the petition, is not an issue that is presented or proposed to be addressed by the Court. Indeed, it is more of a political decision of Congress and the Executive to determine in the exercise of their wisdom and sound discretion.”  This does not refer to the deference to the other government on this matter because they are most in tune with how the international community actually would react to a very radical unilateral decision that say government to just put a peg on debt service or just not pay. So in that sense they gave due respect to the decision of Congress in the Executive actually to allow the operation of the automatic debt service. After this case, there were attempts almost always from the Floor to actually veto the automatic debt service provision. And that has, almost always, not benn allowed.  It has always remain that time, and to a certain extent one may ask “What is the Philippine attitude then with regard to international financial obligation?”  I think there’s respect on the part of Philippine government and while there’s also great temptation to distinguish certain debts as they said, and for example the ___________Nuclear Power Plant that has been the subject of a lot of I think progressive thinking to just walk away from our obligation. In fact we have paid it almost full. In fact already, because we have fully paid. If one were to look back, however, did we behave in a manner that was consistent with the norm at that time to respect financial obligations.  I have not, in fact, tacled the issue of  odious debts because the odious debts in International Law had been actually applied in certain situations where countries did not want to pay obligations of previous governments or previous states. Because they did not _________ to the benefit of the citizens. I’m not tackling that in that perspective. Although there’s a World Bank study now that perhaps there might be situations that debts did not definitely _______ to the citizens because of an authoritarian government and corruption, for example, were actually be allowed to forgive those debts, under certain conditions. In the case of the Philippines, and I remember this very clearly, one of the announcements made by then President Cory Aquino before the U.S. Congress was respect the international financial obligations. It was, probably, from a point of view of the progressive groups at that time, something that she should not have said. But there are others who have said perhaps that was also a message that says we are going to honor financial obligations because we respect our commitments. It’s a very strong commitment to say that we are part of an international community and they know the expectation of the international community. There are still, of course, challenges at this point on how we will deal with those.

If you now look at the way the economies also coping, one time during the financial crisis, we are one of those that are very very much stable economy even during the Asian Financial Crisis. Then we do the right thing, for years. And I think it’s a message that successions of administrations have, to a certain extent, been reading quite well how the international community expects us to cope with crisis. So the term “current international transactions”, as I have mentioned, would perhaps pertain to all payments during the financial foreign trade or other current business including services, normal short term banking and credit facilities, payments due as interest on loans, and net income from other investments, payments of moderate amount for amortizations of loans, or depreciation of their investments, etc.

Let me move to balance of payments financing in relation to the doctrine of conditionality and the development of what I call, it’s a very contentious instrument called “stand-by arrangements”. When one would like to avail of the resources of a government, of the Fund, the International Monetary Fund because the government is in deep balance of payments deficit, you are allowed to enter into an arrangement that is called the stand-by arrangement. It may run for one year, two years, three years. The Philippines, I think, has been through a lot of SBAs. We keep on renewing SBAs simply because we continue to have need for an assistance for a long time. But now I think we’ve graduated from that. We don’t have an existing SBA anymore.  And that goes well for the economy of the government. If you are “off” the arrangement, that means you’ve been able to cope with your balance of payment problems. Now, what is interesting here is that tenor by which the International Monetary Fund would treat a stand-by arrangement. Now from basic International Law, if a government enters into an agreement with a state that from the point of the International Law would be a Treaty. If you enter into an arrangement with an inter-governmental organization, like the International Monetary Fund, what is theoretically the status of that Agreement? Would that have the flavor of an International Treaty? Now, there is decision of the Supreme Court for recently in the  “Bayan v. Romulo that says that “when the parties enter into agreements like to states, it’s also up to the parties to characterize the nature of the agreement on whether or not they would want it to go through concurrence by the Senate, for example as in the United States and the Philippines. So there are certain agreements that may not necessarily have the structure of a treaty but perhaps executive agreements, lesser of a Treaty, but still would have international legal consequence for non-compliance. In the case of the IMF, they say stand-by arrangements are not international agreements that comes from that. We will try to understand why does the IMF want this characterized as a non-international agreement? The Fund also says “the Fund will pay due regard to the domestic, social, and political objectives, the economic policies and the circumstances of the members”. The reason for that is for some time IMF has been criticized saying that the economic policies or prescriptions that the International Monetary Fund missions would normally recommend, within a short term, even affect human rights and even social protection measures of a government. And, therefore, in order to avoid that implication to the IMF on having to impose certain measures that will undermine sovereignty or even human rights principles, the Fund makes it a point to say that it will pay due regard to the specific situation of the country. And, therefore, as much as possible, the design of an economic policy for purposes of addressing balance of payments issues will be specific by country. But, again, most of the literature will show that it appears that for several countries in the past, especially in the ‘70s and the ‘80s, there has been a consistent “straight jacket”, “one size”, “fits for all” approach or attitude in the part of IMF. And there will be some flexibility that will happen later on because of the reactions of some countries anyway. But this is very clear from the document of the IMF that it will pay due regard to the domestic and social and political objectives of a country.

Now let me go closer to home. This is where I’d like to look at stand-by arrangement in the context of the Constitutions of Ireland and the Philippines. You know Ireland very recently also had deep financial problems and they had to go through an arrangement with the IMF. And I got into a very good discourse or literature that actually tackles the predicament of Ireland. When you approach the International Monetary Fund for balance of payments financing, there are two stages to this. The first is the government will write a letter of intent. They will say we are in need of your financing for the following purpose, explain. And then the IMF now Governing Board will respond to you and say “Yes, we will allow you for an arrangement of one, two or three years depending on the need of the country.” That’s the first stage to it. Now for you to be able to give the money, you must have a set of economic policies in place. So you come and say “this is my plan on how the economy will be addressed for the next one to three years”. And only after you’ve done that, that there will be approval on the part of the Fund. Now when you have to get the money, that is when the transaction begins. The transaction actually is not a lump sum. It will not be given to you in a lump sum. It will be given in ‘tranches’. We call it a ‘tranche’. For every tranche, on a periodic basis, there are monitoring tools for the IMF to actually look at the compliance per stage. So, could you imagine that, a state is submitting itself to an international organization to be monitored when it comes to compliance with economic policies. Where is the difficulty here? What if this state is unable to comply with the economic policies? Then the drawdowns, the tranches will be stopped for some reason. So we’ll almost always have periodic monitoring for that, because that is the economic discipline required as a country.

Now in the case of Ireland, the second set of transactions where you now have to draw, you have to purchase from the Fund, let’s say currencies that will now be the subject of a constitutional issue. As far as stand-by arrangement is concerned, I think Ireland would not consider it consistent with, let’s say, the Fund’s position that stand-by arrangement is not an international agreement. Therefore, it does not have to go through what we call concurrence. But what one observer had said that “Perhaps in Article 29.5.2 of the Irish Constitution, the second level of transactions is really what will be applicable because the Constitution in Ireland says “The State shall not be bound by any international agreement involving a charge upon public funds unless the terms of the agreement shall have been approved by Dail Eireann.” I think this is their lower house but the principal chamber. So it has the equivalent of our concurrence by a senate.

Now there was an argument explained by one writer that says “As long as the Irish State did not assume any legal obligations whatsoever, there was no international agreement put in place, and therefore Article 29.5.2 was not applicable. But, at the next stage, and that is when you now begin to transact as for your tranches or drawdowns the Government here would actually be entering into actual purchase transactions and therefore it would be assuming certain obligations on behalf of the State, which will turn out to be in need of prior approval.” Now how does this ring a bell when it comes to our own Constitution? If for example the Philippine Government itself would now have to get into a stand-by arrangement, I think we have consistently practiced almost the same way that the Irish Government had done in a way. In the past, I cannot recall of any stand-by arrangement that had run through the concurrence of the Senate. Never have I seen such. So that confirms in a way our admission that the Fund considers it as not an international agreement. However, under Article 7 Section 20, the provision before Article 7 Section 21 on Treaty concurrence, it says that “the President may enter into loans or guaranty international financial obligations in that regard only with the concurrence of the Monetary Board. But my dilemma there has always been, if the President, on behalf of the Philippine Government and the State, enters into a Loan Agreement with another State or, in this case, with International Monetary Fund, from the point of view of the Vienna Convention of the Law of Treaties, and under the definition of what a Treaty constitutes there, is there a written agreement entered into between two States governed by International Law. It fits Vienna Convention of the Law of Treaties. And, therefore, I would think from the point of view of International Law, that is an International Agreement. But the procedure domestically differs and we have made a distinction between loans on one hand and treaties in other international agreements on the other hand. So there are two provisions. But from the point of view of International Law, I think that will have anyway an International Agreement status. But domestically the process is different. Much the same way here, even if the Irish Constitution says that “It is not an International Agreement but you interpret the second set of transactions when you begin to have to purchase or actually borrow specific tranches that will create a binding legal obligation. But is it a treaty or not? Perhaps from their point of view it is not a treaty domestically but it will have an international treaty status as far as the Vienna Convention on the Law of Treaty is concerned.

So here is a summary of what I have so far been discussing for you. And if you look at the framework here, this was applied some time in the 1980s and 1970s when you had many sub-Saharan African countries, we also have Latin American countries into this framework.

Now let me introduce a number of characters. One is the Paris Club Group of Creditors and the London Club Group of Creditors. We go to the Paris Club Group of Creditors which is really composed of your creditor governments. Most governments, I remember, is almost given concessional loans given interest rates. It is almost like an aid but the commercial facts that were exposed many developing country borrowers especially the 70s at the height of the quadrupling of oil prices, decided to bond together just like what we have seen in the private Bondholders in the early stages of sovereign debt negotiation for the Second World War. They bonded together and they called themselves London Club. Now there are two distinct agreements here. On one hand is the Paris Club Scheduling Agreement where you just basically schedule. That’s all that they do. Anyway it does not entail much interest, it’s almost zero interest. But when you talk about the private commercial banks, they are most exposed and they have depositors in their own countries and therefore when you begin to write off debts, that’s a no-no from the marketing industry. So how do you prevent that situation? You look at the clubs. The clubs only are among the creditors, they are not among the debtors. And they said, “You know if at one time Argentina, Brazil, Mexico come together, and form a debtors club, you could imagine the impact on the world economy”. But this is how they deal with the debtor. So the debtor goes to Paris at a meeting where they tell the Paris Club group of creditors for purposes of rescheduling, this is what we need to do. But before they can even do that or before they can even restructure their debts with the private group of creditors, you have to have already your IMF stand-by arrangement, because that is the zeal of good housekeeping. That this country has already talked to the IMF, presented a set of economic policies that eventually will translate to legislation. And that’s the only time we will have confidence, that you are going to recover within a certain period of time.

Now where is the difficulty here? Legislation may mean increases in taxes. It may mean liberalization, opening your economy, it may also mean budget cuts on certain factors that you would not have a quick return on your investment. So this is where the difficulty begins. And this is where national governments will now have to determine “how will our citizens cope with this?”  If our Constitution talks about social justice, fundamental rights of our people, protection to the most vulnerable sectors of society, and we have such Constitutional mandate, how do we now use this as a set of standards now to look at economic policies that will have a bearing, on a short time, painful but there have to be a long term gain. Now that’s the most difficult for a government. And if the government is not popular enough, it might fall overnight.  And there’s a literature by a group of German sociologists that I have seen one time, really very very interesting to study the so called Vicious Tangled Indebtedness where you might, at one time, have a communist government, or you might have a junta depending on the capacity of a government to be able to implement what we call austerity measures. So there is a very fragile, very fragile situation in the implementation of such adjustment policies and this is where ______ come in. There are stories that in sub-Saharan Africa, some of the poorest countries then, IMF missions actually become Secretaries of Finance or even Central Bank governors simply because the country does not have the capacity to even run those economies. That’s, of course, if you would look at it from the point of view of intervention, that’s a fraud, but what can you do if you want to save the economy? So that has been the other side.

So this is the model, this is the model that has been going on for a long time. I’ll just run through some of the basic principles, just like in ordinary contract, debts. You have to have respect for the rights of creditors. So even among the creditors, you have to be assured  that it will be paid. So they almost always want good behavior on the part of the government. And that means again referring to a program that the IMF already has seen with the debtor country. You also take into account the legitimate interest of creditors, you have to treat them equally. So among the Paris Club Group of Creditors, you also have to treat them almost equally.

For debts that are actually owed to private creditors, there is entirely different sets of norms. And this is where I’d like to bring you with. Well, again, I just want to emphasize that equality and non-discrimination among all creditors. That is a standard set. And as far as private non- officially guaranteed debt, you have to negotiate it with the private creditors on a different plane, and that is your London Club. That is how they negotiate it.  So that’s the UNCTAD that has also reached the level in 78 to a more multilateral framework. So it is recognized as a norm and again there is need on the other hand to protect the interest of both the debtors and creditors. You do not want also your debtor to actually close shop. So they have to take into account the reasonableness of payment scheme.

Now let me go the private commercial banks. It is very interesting because this is where they apply very strict, if you’re in the private practice, this is really drawn from typical loan, commercial loan agreements, where you have a syndicated loan. But what is interesting is that now that type of loan agreement takes into account IMF. They now say you still have to go to the IMF because that’s the only way we can have confidence that if we restructure your debt, infuse new funds to you, then you will be able to recover. Otherwise we will not throw good money again to you. So that’s why they require that specific provision in a syndicated loan agreement that you have to have stabilization obviously already in place before you’re given restructure. There are conditions precedents before you do anything, you have to do certain things one of which is IMF stabilization program. So you have to be in good standing with the IMF. If you are not in good standing with the IMF, you have not been observing your economic policies, then we will cut, events of default. What is “Events of Defaut”? If you are unable to maintain your good standing, that can trigger an event of default in a restructuring agreement.

And this is Venezuela. This is actually the closure of my initial research way back in 1989 when I was wrapping up with my research at that time, the bubble burst for Venezuela. Venezuela is one of the more respectable Latin American countries at that time. It had oil, of course unlike the other countries there. But in 1989, Venezuela hit a snag and they had to resort to IMF assistance. So the President sent an economic mission to the IMF in New York for a meeting. And the IMF gave almost the typical prescriptions, short-term austerity measures that needed to be immediately implemented. The Mission said, the Venezuelan Team said, “this will be very difficult for the country”. But the IMF said, “but you have to do it”. They went back to Venezuela and in three days there were riots in six major cities in Venezuela leading to about a hundred deaths. One, because there was a drastic cut on subsidies, subsidies usually will cover those that the consumers are most intended on at that time – energy, food for example. In other parts at Middle East there were subsidies on bread that had to be cut for a short term that led to actual protest. So when they went back to the IMF, then the IMF began to realize there might be need to reevaluate. And this is where a credit also should be given to the Institution because, while it is very difficult to apply policies that may differ from the traditional approaches, it has become more open to new framework. So, sometime in the 90s, there was a Treaty Plan. Secretary of State Brady of the United States proposed certain measures that will allow some countries to postpone payments, so no interest because as of the time that negotiations were going on, you are not allowed even to postpone payments on either interest or principals. But then they began to relax that. But the more telling was, of course, the case of Highly Indebted Poor Countries. It has become a reality that many countries can no longer service their debts. They cannot even pay their principals anymore and therefore there was a realization from the point of view of international community that perhaps for Highly Indebted Poor Countries, they may just have to write-off their debts, forgive them. And that happened finally. And this is where, I think, where the IMF has, to a certain extent, been convinced. Fortunately we are not in the list. That means we are not highly indebted country and not poor in that sense, because in a way our economy had been able to cope with this.  So that became possible in the HIPC Initiative. What did the countries do for they had some savings. They channeled it to health, education and other development purpose. And that is where they were given much breathing space.

Now, let me go to the Asian Financial Crisis. The Asian Financial Crisis was not a typical balance of payments problem, according to the IMF, than the other economies around the world. They say you look at the situation. While there may have been allegations, for example, of corruption, or internal mismanagement, that is not really in the class of developing county borrowers’ problems in the 70s and the 80s. Besides, you are looking at East Asia, where the action is, economically, where you have some of the most robust and fast developing economies – Korea, Malaysia, Philippines was cited, of course and Thailand. And so, when this happened, there were some resistance on the part of Malaysia, Thailand and the Philippines to resort to IMF at that time. It was only Korea that went through a very very rigid stand-by arrangement and this is where, I think, IMF began to defer in approaching problems of some of the economies in Asia. Because now it is not the typical IMF balance of payments financing issue. What they did was to cover even trade liberalization more expansively, privatization issues, foreign investment, pension reforms, public sector austerity measures. These are not the normal structure of adjustment loans program. So it combined both structural and corporate and good governance, which is very interesting from the point of view of financial law.

Now comes the last stage, the European Debt Crisis – Greece, Portugal, Ireland, Italy and Spain. Could you have imagined that? We’re back to frame World War I situation. We started off with Europe, we now end again with Europe. And, in fact, our Central Bank Governor offer to join other developing countries to share a certain amount of their reserves, in fact, to extend to a bail-out package for European debtors. When I heard that, I said “what an act”, hard act to follow now. There were those who criticized “Bakit naman nagmamayabang tayo”. But from the point of view of good global citizenship, I think it was a good gesture. It was a very good gesture on our part. When, at one time, we were in dire need, tumulong sila. Why not. And these are some of the best developing partners also we’ve had in the past. Then there’s Spain, of course.  Sentimentally still, very much attached to us as a people. But Greece, Portugal, Ireland, Italy and Spain. Now this was interesting because there was a government initially that implemented the austerity measures but actually did not sustain the capacity and fell, and you had a new government.

What is of interest now is the development of two mechanisms in Europe. The Fund called Financial Stability Facility and the other one is the Financial Stabilization Mechanism. Now this is actually in the model from the IMF standard arrangement. Why did they come up with this? Because there was no framework in place for them. It shook the heads of the Europeans to grapple for a mechanism. And so within their own treaty-based rules, they try to find a way “how do we justify this?”  “How do we justify these mechanisms?”  But first, by way of distinction, the first facility which was initially implemented, the EFSF was actually funded by Euroland members. In the other stabilization mechanism, subsequent to that, you now have the participation of IMF. So IMF came in. Because IMF is really not most welcome in Europe.They don’t want that because you have a very proud, integrated economy and says “what is IMF going to do here?” We have another layer anyway of governance in Europe. And because of the experience with developing country borrowers, they said “I want to be given the one size fits all remedy for economic change?” It’s the second one that will now become permanent. So you will now have a mechanism in place. This is perhaps the equivalent of a standard stand-by arrangement in the European setting.

So that’s what I said, it’s the stand-by arrangement with the following features. So what’s the procedure, a member experiencing severe financial disturbance will prove that it is in need of the Fund, that the disturbance is beyond its control. Next, is that a member could not by itself raise money. Next is a submission of an economic and financial adjustment program, sounds like a stand-by arrangement, and finally you now have more close monitoring by key institutions in EU such as the Court of Auditors and the European Anti-Fraud Office. Why did they have that in mind? Because they realized these countries that got into debt problem particularly Greece, Portugal and Ireland were what we called peripheral countries. Peripheral because when they were allowed to enter the European Union, their economies were practically not in the same plans as Germany and the rest of Europe. But they were allowed nonetheless by Germany hoping that they will be competitive enough to catch up. But actually when you enter a place like for one time you were perhaps in one part of the metropolis and then you go to Forbes Park, then you begin to be tempted to live the way those people live. Right? Forbes na eh, I must have a Mercedes Benz, when before you only have Kia. Sorry ha. Greece, Portugal, Ireland – the peripheral countries at that time. But you know particularly Spain, they are the most stabilized ones they were also hard headed. And thanks to the United States, because that’s what really triggered it in part, aside from the peripheral situation that they had at that time. But it was really triggered by the 2008 flood in the United States.

Now this is again from a legal perspective of interest and I found in one of the literatures recently. There is a justification that they had to do. So far what we have been discussing since the first hour is that there was no clear mechanism in place internationally. Because before, there were no international institutions before the second World War like IMF, World Bank, or WTO. But from the Second World War, after that we have a more distinct set of rules. But still the way they dealt with it was on adhoc basis, simply because you have to respect the sovereignty of states nonetheless. They have to consent to certain procedures. But now in the European setting, there is a provision in the Treaty of the European Union Article 122 paragraph 2 which says “where a Member-State is in difficulties or is seriously threatened by natural disasters or exceptional circumstances beyond its control, the Council, on a proposal from the Commission, may grant, under certain conditions, Union financial assistance to Member-State concerned”.

The “exceptional circumstances” test in the provision has been interpreted to cover and I quote “serious deterioration in the international economic environment.” What about the peripheral member-States where there has been, according to one set of studies about Greece.  Greece actually concealed certain facts to the Union which actually caused or aggravated their economic situation. That was mismanagement, pure and simple. There was concealment. But if they contributed to that, would that have been exceptional circumstance.  It looks like under the European Union practice now applying now to peripheral countries, they would now consider that also as an exceptional circumstance. So the inducement of the crisis from the United States down to the peripheral countries would now be considered as one of those. So this is interesting development today in Europe. And so far in the region we don’t have it in Asia. We will still have to rely on the IMF stand-by arrangements right now. But this is for me the latest development on the sovereign debt negotiation.

Sorry to have exceeded few minutes. I just want to make the observation that as far as sovereign debt negotiations are concerned, we have seen remarkable changes from the time the IMF was constituted, to a certain extent, it had become more sensitive to what happened to developing country borrowers and now with the plight of what we call peripheral countries in Europe. The second is that you have new classes of debtor states. We have developed states now – the ‘Forbes” type of debtors.

And finally, austerity measures have now become transparent. They resort to parliament first before you even implement their economic policies. It has now become sort of the standard, whereas before it was from top to bottom. Today what they do is, in order that the economic policies should be accepted by the people, you have to have more transparency because the people have a stake into making a decision that will affect their lives. So there is no more secrecy in so far as transactions are concerned.  And finally, there is a lot of literature now that says “social protection and economic human rights must be given precedence here”. We cannot ignore the fact that children will be deprived of access to milk. For example, basic services, basic needs of people will now have to become standard norms to deal with when you now have to implement economic policies. And there are standards like universal human rights principles, you have the economic social cultural rights and even civil, political and economic rights that we may actually have to balance. We cannot sacrifice governance on one hand for the sake of instilling austerity measures. We must respect fundamental rights on one hand and also respect at the same time the right of the state to survive by implementing reasonable economic policies, but in the end with respect for fundamental human rights.  That’s right, and thank you very much.

Emcee:  Thank you very much Atty. Candelaria for that very informative lecture. Speaking of standards, you have definitely set a high standard for the other deans of the other law schools, so they _________ in their own public lectures. So, students, now is your chance to put the Dean on recitation. So the floor is now open for questions. Please feel free to ask your questions.

Dean Candelaria.  Actually I brought the classcards. You better volunteer, if you want volunteer recitation.

Q & A:

Student A. Good morning Ladies and Gentlemen. I’m __________________.

So Dean, I remember the case of the WTO case Justice. In that case a significant observation by the Court which I think saved the case is really the 5-year, I think 20-year leeway given by the WTO to the Philippines. Example, Justice, if for example we prove to the WTO that we can’t still comply, given the 5-year or the 20-year leeway, can we say that we can still implement the provision of the WTO in that regard?

Dean Candelaria.  I think you have just put the ponente to a recitation.

CJ Panganiban. I think it is really difficult to be in Ateneo. I am only from a poor man’s University you know, although raised in standard by the present dean who come from the best law school in Rockwell. But I will answer that later on when my turn comes.

Dean Candelaria. I think we would also have to look at as far as the economic institutions are concerned. They have what we call special legal origins. That’s a specialist. Before even resort to a remedy outside the Articles of Agreement or outside the WTO, let’s say Charter, you actually have to look at the mechanisms within. In the case of the IMF, non-compliance with economic policies will allow you to resort to consultations. Because they don’t want you to do unilateral actions. So they give you that opportunity. It’s like an exhaustion of domestic remedies, exhaust the remedies within the Institution before the Institution can even accuse you of having violated the international obligation. Because it will not vote well. The intention of economic institution is really to allow you to be assisted. That’s why technical assistance is very important. So I would not worry. I mean that is normally the concern of some of the person who says “pipirma na naman tayo sa isang agreement that will submit us ……”. But that is part of global citizenship in the end. You want to be monitored, you want to be transparent about what is happening. At the same time you would have the reciprocal obligation and right to seek assistance, then why not? And that should not lead to a situation where there is state responsibility in a technical sense under the Articles and State Responsibility. Thank you.

Yes, Mr. Vicente.

Student B (Mr. Vicente). Sir, from a crude law students understanding of basic economics and I hope Mr. Sobrepeña will not criticize me as ________________.

I would like to know, but based on my understanding, a country spends on deficit if it knows that it can collect the tax that we’ll be able to pay. Basically you’ll have to have a very conservative fiscal policy if you are determined to get into debt service. However, with my understanding of history is that, it began with the administration of Former President Marcos wherein a lot of spending was placed into unproductive ventures like the military and ambitious projects that were ridden with corruption. My question would be three here: Did you encounter in your study the impact of corruption on debt servicing of developing countries? And then why do debtors renegotiate or adjust, what were their considerations, and then what are the characteristics of states who have renegotiated, and finally there’s a fourth question here. Why did the Philippines basically you mentioned that we were able to finally free ourselves from a lot of IMF obligation. How did we come up with that? Did it start within the administration of Ramos, Arroyo or the Aquino administration? What were the factors that led to our so-called “finally I can free from my debt status”.

Dean Candelaria. Let me answer immediately the last one ______ teddytorial. I like Teddy Boy Locsin’s teddytorial on that. That what was exactly what he pointed out when he said “if you look at the gains of the current government now, it’s two years only, but if you look at the gains it was incremental, it started way back. And even from the point of view of I think economic continuity, even from the time of Marcos, Aquino, it’s incremental. And perhaps we have never really walked out of our obligations. Which was very difficult from the militant’s perspective. There will always attempt to say “let’s walk out of this and that”. But we have always honored our financial obligations. If you look at that, and the goal of the IMF, you feel confidence, and the International community has confidence in you. By any other special circumstances domestically, they’ll continue to come back and support you. But I think we have been a good debtor, you might say that. Others may not agree with it, what with the unilateral actions, but I think it has been a consistent policy decision on the part of Government to honor obligations. And we have been at the stage now where, even during the financial crisis, we have not been affected that much among the other countries in the region.  That’s the first.

The other one is, apat yan ano. What was the first one you wanted?

Student B.  That’s ok Sir, thank you, joke. The first Sir was basically what is the impact of corruption.

Dean Candelaria. Now corruption has always been an issue in many developing country borrowers. I think you just have to look at the history of South America, Sub-Saharan Africa, and some in Asia that’s right. But, as I said, the options have not been considered by some countries. Some countries would not want to pay but from the point of view again of international law, the odious debt is perhaps what comes closest to that principle even if it did not benefit. But my reading, at least from the studies that there has been a consistency not to undertake unilateral action. Most states have at least grant and this leads to the second question on “what’s in store for the creditors to go through renegotiations?” Well, again, you will see whether you like the banks or not, it has been in their interest for the debtor to recover. Everyone wants a member, a member of the community to recover, right? And need assistance. And to do that, you extend, you give them leeway. That’s the interest for them. And if they are able to recover, these debtors will be able to repay, then they could be part of the economy either domestically or globally in a more progressive way. That’s the whole purpose, confidence. And the third one?

Student B. Sir what are the characteristics of the states to renegotiate? But more precisely, Sir, what kind of states frequently negotiate?

Dean Candelaria.  Let me answer it in a different way. There have been countries who have been under IMF “tutelage” for a long time. Whether you agree with me or not, there were countries like Brazil, where is Brazil now, Mexico, we don’t have to go too far, Korea. First Korea, Koreans are here because the standard of living really is very high now in Korea which means they have reached a level of almost like a North American, European standard. And Korea has been, for a long time, actually resisting austerity measures in the past. You can see the Government in Korea are very difficult, very volatile and yet they have implemented austerity measures. And in the last financial crisis, they were the only ones that went through a stand-by arrangement – not Philippines, not Malaysia, not Thailand. In the case of Malaysia, it’s Mahatir. He just does not want intervention, he even imposed capital controls, which is a no, no. But they have a different approach. But Korea did that. And IMF cites Korea as, in fact, their success story now. Whether you agree with that or not, I think there is objective evidence that they’re here. One even married one of our lawyers. We lost her to a Korean and good guy, very good guy. Thank you.

Student B. Thank you Sir.

Dean Candelaria.  Yes Sir, Mr. Samy.

Student C (Mr. Samy). Sir, based from my readings from your presentation, one observation was the multilateral framework is a ________ as regards answering or responding to the individual needs of a country. So one of the trends nowadays is for countries to have bilateral treaties with each other for much faster transaction because there are less parties involved, less interests involved. So, Sir and there’s this principle that “a beggar cannot be chooser”. So, for example, I am a beggar, a borrower country who is in much need of an aid and you have this creditor country. How will you reconcile the minimum standards or civil political rights as regards to that principle a borrower or a beggar cannot be a chooser. Because most likely Sir from what I’ve read, the practice nowadays is that when a borrower tries to apply for it, there is this proforma treaty or proforma agreement in which this agreement can be based for subsequent agreement. So the borrower, in this case, has less leeway with regard to its negotiation. Sir, how do you reconcile that to the minimum standard for civil political rights?

Dean Candelaria. I’m trying to discern whether you’re pointing to the impact of agreements on the rights of citizens?

Student C.  Yes Sir.

Dean Candelaria.  Well, let me just try to distinguish your example. Because in bilateral agreements now or treaties, it happens mostly in investment treaties. ____________. But in terms of loans, it has been the framework so far, unless you deal with creditor governments. By that, that the Paris Club. But as you have seen, those countries to which a debtor owed almost to a group of government creditors, would deal with it in a culled way. That’s in the norm, simply because they wanted some assurance that you would go to a process like the stand-by arrangement to be assured that you will be able to repay. Now, on civil political rights, are you referring to the impact of these agreements to fundamental rights of citizens?

Student C.  Yes Sir.

Dean Candelaria. It really will affect more the economies. Because you’re talking about standards of living. On whether or not such loan agreements will affect the standard of living of countries, what I left out in my conclusion but it was in the paper I gave to Chief Justice Panganiban, was the difference between the tolerance on pain and suffering between those Greek, Irish, Italians or Spanish with the developing country borrower citizens. I think most of the developing country borrowers that have to deal with years and years of indebtedness and also economic privation and the tolerance is much higher compared to more countries here. So we now look at levels of economic standards. Pag nawalan ng isang kotse doon sa Europe, disaster. Dito, ni walang kotse iyong taong naghahanap ng sasakyan. He has to take the rise in gasoline, for example, cost of transportation. It really deals on non-legal concepts of ________. But on the level of commitments, I think, uniformity applies to human rights standard. What applies to European citizens also should apply to those in heavily indebted countries. It’s just that on the basis of the resources of __________ that’s when you have to have proportionate response because obviously the pie in Europe is still bigger compared to the pie in the developing country borrowers. But the bottomline is there are fundamental rights that will have to be respected whether you are rich debtor or in a rich country or let’s say a very poor developing country. So it should be the same I think in that sense. I don’t know if I was able to address your concern in that regard, but I think it refers more to the economic human rights in that regard. Thank you.

Ok, Sir.

Student D.  Sir, Good morning. This is more of a clarificatory question Sir regarding one of your conclusions. One of your conclusions was, IMF now had evolving standards in sovereignty renegotiations particularly you said that they are being now more sensitive to their debtor countries. I just want to ask how you arrived at that conclusion and how you reconciled that with the fact that they are now applying more conditionalities and the conditionalities have expanded in scope. How do they become more sensitive when the conditionalities have entered the range which they have not entered before. How does that give more leeway to debtor countries.

Dean Candelaria.  Ok. I think it is more or less a function of how the causes of indebtedness have evolved through the years also. Because now they have realized that some of the causes of indebtedness may actually be attributed to mismanagement and not your balance of payment deficit. So, they have to address that. That’s why they go into issues of governance. Now, that in a way I think is responsive to the conditions that most countries now are going through, in terms of I think what you might call adjustment. So you will have to see the history in order to realize that the IMF actually is responding to certain ground issues. Now, there are still macro economic policies that have to be undertaken but definitely will have to affect certain rights like workers’ rights. In Korea, the biggest reaction of the workers of course to renounce IMF austerity measures because there were layoffs. So that again, is a direct bearing on the lives of citizens but what the IMF I think, and other economist are saying is that there are certain short term measures, but hopefully on the long term when the country recovers, then you’ll be able to adjust the standard of living accordingly.  But we are definitely going to be hurt along the line. And that is where, I think, looking at the history of IMF involvement, they have been trying their best, they’ve been trying their best. Thank you.

Student E. Sir, about standby agreement, Sir. Is it like a contract to sell?

Dean Candelaria.  It is the other transaction. The arrangement is really one between the Fund and the Government to say “we will make a facility available for you for certain period of time. The actual drawdowns, when you now have, it’s like a credit line, when for the next quarter you will get $25 million, next $25 million. That’s specific transaction. And that is what makes it interesting in the analysis that says “in the second stage, that definitely is like an ordinary contract in the civil law. In fact the analysis was under civil law by that person from the Bank of Romania, it’s a civil law country, and they were trying to imagine, “does this not have the effect of bilateral contract already, so that’s the distinction made”. But in the arrangement, IMF says there should not be any contractual flavor given to them.

Student E. So Sir it will be trouble if it become a contract.

Dean Candelaria. From the point of view of Government and the IMF that would be basis to say there’s a breach of an international agreement that will allow the other party, like the IMF, to go to the ICJ. But you don’t want to have economic issues being settled by the ICJ. It’s much to say why the Supreme Court was deferred to the political branches of Government like the Executive when it comes to matters of the economy.

Student E.  Sir, because the way the law was ______ Sir. Contractual provisions will be avoided.

Dean Candelaria. You cannot impute a contractual flavor to SBA.

Student E. Ah, ok. But Sir it is not mandatory so it could happen.

Dean Candelaria.  No, from the point of view of the IMF, that’s their position.

Student E.  Ah, ok Sir. Just final question Sir. Do you agree that for example there are people saying that the Constitution should be amended to be more responsive to economic issues, economic developments in the global…..

Dean Candelaria. That’s a very contentious issue now. There’s a mind that says there are restrictions obviously when it comes to foreign partnership that would have encouraged if you had a more open, let’s say, ownership provisions. Personally, for me I think there’s enough in the Constitution now that will allow us to progress. If also we would do better housekeeping within the branches of Government. By itself, I still believe that the Constitution has its stance now, it would have to be maximized in its impact. Of course it’s a policy decision. If we say “do you want to go from primera, segunda, tercera,” then opening it up when it comes to ownership probably will change. But there are other repercussions also that you have to take into account. The impact on the other sectors of the Government and also on the part of the citizens. But for me I think we have to maximize the provisions of the Constitution now and there’s enough leeway for them.

Student E.  Thank you Sir.

Dean Candelaria. Yes, Professor Gatdula.

Professor Gatdula. Just a couple of comments. The first comment I actually want to say, the lecture actually dealing on sovereign debts and in fact for me one of the most critical issues particularly for developing countries, which I think they missed but not many people brought it up was the fact that when Strauss Kahn was actually removed from Office, there was a move for a developing country particularly _____________ which I think a lot of the Asian countries and the Philippines missed. There has been a tradition of having America for the WTO member, and the European, and in the end it was a European who replaced Strauss-Kahn, Christine Lagarde. I feel that next time there should be an election for the replacement for the IMF Head. I think there should be strong _______ an Asian, and hopefully Filipino. ___________Bobby Ocampo. What do you think?

The second comment I’d like to make is, and this also _______ here. The three heads of the economic groups, I don’t know if anybody actually noticed, Christine Lagarde, Pascal Lamy, Robert Zoellick, they’re all lawyers. So there’s a shift right now in the way that legal profession is actually running. There is a probability here that you may not have or at least have a legal profession that is actually part of the legal profession and ___________ more flexibility because there’s a need for profession concerned.

Third comment is one actually which is in response to your comment and this is again for the benefit of the students. Dean Candelaria is talking about the non-unilateral action taking _________ for sovereign debts, and he made a reasoning on the fact that well it is part of what being a good international citizen is about. And I think that ________ is actually personal profound philosophy in that one. To put it as inelegantly as I can, I frankly don’t care for being an international good citizen. I believe that if every action a state should take is that state should take for the sake of national interest and not from a point of view of caring or not whether the other countries would be happy about what they see. Having said that, the effect would probably be the same. I believe that coming from the perspective, it’s purely sovereign national interest, it will not ________ as a country to actually not answer for these lessons. Having said that, that’s it.  Thank you very much and Congratulations Dean Candelaria.

Dean Candelaria. I respect your opinion. I empathize with you when it comes to the China situation.

Ok. Thank you very much for your very decisive remarks.

1st Lecture series at ateneo (1)

Chief Justice Artemio V. Panganiban Professorial Chair on Liberty and Prosperity
First Public Lecture on Wednesday 19th of September 2012 at the Justitia Room, 4th Floor, Ateneo Law School.
Dean Sedfrey M. Candelaria as Lecturer.