Interport Motion for Continuance of Proceedings discontinuance of investigations
until undue publicity had abated and the investigating officials become Facts: free from prejudice and public pressure Appeal from CA enjoining SEC from filing action against IRC regarding No more formal hearings but SEC manifested that: S8,30,36 of RSA o There would be an investigative panel before PED (Atty Abugan, S8: PED exclusive authority to investigate Devera, and Aquino) to resolve hearings 30 Insiders duty to disclose dealings o Recall the show cause orders to show why no sanctions should be 36 beneficial owner of 10%+ any security/equity; Director/officer of the imposed issuer or security obligation to submit statement regarding ownership, o Deny motion for continuance for lack of merit changes in ownership of the securities Partial Reconsideration creation of investigating panel?? = denied 1994: MOA between GHB and Interport Issuance of WPI = GRANTED SEC cant file case against them o Acquired 100% of the entire capital stock of GEHI (operate 102 Motion for Leave to Quash SEC Omnibus Orders so PED can investigate MW gas turbine power-generating barge, 97% complete at that accdg to SEC Rules and PD902A time) CA: Theres no IRR regarding disclosure, insider trading, or any provisions o 5-year power purchase contract with NAPOCOR of RSA o Interport will issue GHB 55% of its expanded capital stock (40.88B o SEC has no authority to sue them under S8,30,36 RSA with 488.44M par value) o No proceedings may be held against respondents without o Interport will acquire 67% of entire capital stock of PRCI, where violating rights to due process and equal protection GHB agrees to help by extending a loan to Interport o Without IRR SEC cant quash omnibus orders Interport: weve faxed our press release announcing agreements with GHB While pending, RA8799 Securities Regulation Code repealed PD902 so no to PSE and SEC Aug 8 1994, but since they didnt receive it, they made more PED (s76) interport send it again, so they did the following day. SEC: got reports that Interport DID NOT DISCLOSE DEALINGS with GHB on Issues/Held: time, and that directors heavily traded shares using MATERIAL INSIDER 1. WN there was need to enact implementing rules for SEC to exercise INFORMATION authority and hold respondents liable under RSA? -NO!! SEC Chairman: Directive In the absence of const/statutory infirmity (declaration of invalidity/unconstitutionality) concerning S30,36, they are legal and o Interport, submit copy of MOA with GHB binding for all intents and purposes o Directors to be present in HEARING before Brokers and Exchange Absence of implementing rules for S30,36 cannot invalidate provisions of Dept. to explain failure to disclose info as required by Rules on law where reasonable construction that will support the law may be given Disclosure of Material Facts Interport complies! Statute contains sufficient standards and unmistakable intent, there should SEC Chairman: Order Interport violated Rules on Disclosure of Material be no impediment to its implementation Facts when it failed to disclose negotiations in time, and also Sec 30 and 36 *They claim that the terms under 30 are vague (but theyre not) and need further by the directors definition *Valid standards: simplicity and dignity, public interest, interests of law and Respondents: Omnibus Motion Sec has NO AUTHORITY to investigate order because only PED can(s8 PD902A), and they violated due process when they ordered us to show cause why no sanction should be imposed, 2. Right to cross-examine before PED? NO!! its not absolute shifting the burden to them PED rules of practice = INVALID! Bc s8RuleV failed to provide right to cross- examination o S5 submission of documents (position papers, supporting docs, affidavits of witnesses) o S6 Determination of necessity of hearing (pertinent facts, documentary evidence) o S7 Disposition (inform parties reasons if no more hearing and ask for acknowledgment of information by signing minutes of hearing to be submitted) PED had adjudicative functions s8 (investigative powers) o Do not have requisite standing to assail validity of rules on adjudication o Theyre only being investigated because they failed to disclose negotiations and transactions
3. SRC repeal 8,30,36 RSA? NO!
They were reenacted! Theyre still in the new law, but just in different provisions (s8,12,26,27,23) SRC absolutely repealed the RSA. Generally deprives court authority to penalize person charged with violation of old law UNLESS repealing law PUNISHES THE ACT PREVIOUSLY PENALIZED
Concurring Opinion (Tinga jr)
Public interest in securities market Disclosure (make public large amount of financial info to actual and potential investors) and financial activity regulation (rules on and off stock exchange) Investigation by SEC tolled the running of period of prescription Filing complaint interrupts period of prescription Initiation of investigative proceedings against respondents halted the injunctive orders issued by CA interrupts the period of prescription of SRC
Dissenting Opinion (Carpio) = dismissed petition
Ruling violates S2 Act 3326 because prescription should begin from day of commission or from the discovery and the institution of judicial proceedings for its investigation and punishment Shall be halted on the date the case was actually filed in court and NOT any date before that Only institution of judicial proceedings can interrupt SEC: Only admin investigations and fine imposition and sanctions All shall be referred to DOJ for preliminary investigation and prosecution
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