No.

L-75697 | TIO V VIDEOGRAM

June 18, 1987 | MELENCIO-HERRERA, J | Powers of Cong., Legislative, As to title of bills

PETITIONER: VALENTIN TIO doing business under the name and style of OMI
ENTERPRISES
RESPONDENTS: VIDEOGRAM REGULATORY BOARD, MINISTER OF FINANCE,
METRO MANILA COMMISSION, CITY MAYOR and CITY TREASURER OF MANILA

SUMMARY: Valentin Tio filed a petition to review the decision of Metro Manila Commisson on
behalf of other videogram establishments seeking declaration of unconstitutionality for PD 1987.
The presidential decree entitled “An Act Creating the Videogram Regulatory Board” was
promulgated and took effect, creating the Videogram Regulatory Board, the authority to regulate
the videogram industry. The said presidential decree amended tax imposition on videograms, as
provided by Sec. 134 of the National Internal Revenue Code see Facts. Several movie houses and
producing industries were permitted to intervene in the case over the petitioner’s opposition, as
the unregulated proliferation of videograms such as film piracy may spell the demise of the movie
industry. The rationale of the decree was presented see eight WHEREAS, no. 5 Facts. The main
issue is whether or not Presidential Decree no. 1987 is unconstitutional and shall be deemed void.
The petitioners also presented six points of attack on the alleged unconstitutionality of the decree.
The Court DISMISSED the petition on the ground that no clear violation of the 1973 Constitution
was found. The constitutional requirement that “every bill shall only embrace one subject” was
adhered to, by the said decree. The power of taxation is proper to the state’s exercise of police
power. Amendment 6 of the 1973 Constitution called for immediate measures and dispatch in the
occurrence of a threat corroding the moral values of the citizens. The decree is also not an undue
delegation of power to legislate, but only a conferment of authority. The ex-post facto law
allegation is refuted on the basis that Section 15 of the DECREE raises only a prima facie
presumption of violation of the decree attached only 45 days after its effectivity, and so not
retroactive in character. Lastly, the court does not share in the fears of the petitioners that
videogram establishments are to be over-regulated. It is just so necessary given that the decree has
reasonable objectives, namely regulation and taxation.

DOCTRINE:
a. Separation of Powers: Petitioners sought for the necessity, expediency, and wisdom of
the DECREE which the legislative department is bound to provide (principle of
separation of powers), not the Court.
b. PD 1987 is not undue delegation of power to legislate, but only a conferment of
authority in pursuance of existing laws. Legislation is the making and enactment of
laws.
c. Constitutional Requirement that that “every bill shall embrace only one subject which
shall be expressed in the title thereof” is complied with. The title of the PD is “An Act
Creating the Videogram Regulatory Board” and provisions regarding taxation is just
proper, for functions of the said BOARD falls under the general subject of the act.

FACTS:
1. This is a petition to review the decision of Metro Manila Commission.
 2. September 1, 1986: Case was filed assailing the constitutionality of Presidential Decree
No. 1987 “An Act Creating the Videogram Regulatory Board” (prom. Oct. 5, 1985, took
effect April 10, 1986) with BROAD powers to regulate videogram industry.
3. November 5, 1985: Presidential Decree No. 1994 amended NIRC (Natl. Internal Revenue
Code) as follows:
“SEC. 134. Video Tapes.—There shall be collected on each processed video-tape cassette,
ready for playback, regardless of length, an annual tax of five pesos; Provided, That locally
manufactured or imported blank video tapes shall be subject to sales tax.”
4. October 23, 1986: Several theaters and movie producing industries (to be referred to as the
intervenors) were permitted by Court to intervene in the case over petitioner’s opposition
upon allegations that intervention was necessary for protection of rights, as their survival
is threatened by unregulated proliferation of film piracy.
5. Rationale behind the decree: (1) proliferation and unregulated circulation of videograms
prejudiced the operations of movie houses in theatrical attendance and sales, resulting to a
450M drop in tax revenue; (2) P600 Million earnings of videogram establishments WERE
not subject to tax, depriving PH Gov 180M in tax revenue (3) unregulated videogram
activities affected the viability of movie industry resulting to unemployment (4) ensuring
economic recovery, gov. is impelled to create an environment conducive to growth of
business industries esp. movie industry (5) taxation of videogram establishments will not
only alleviate financial condition of movie industry but also provide additional tax revenue
to gov. and rationalize uncontrolled distribution of videograms (6) unregulated showing of
obscene videograms constitutes danger to moral and spiritual well-being of the youth,
opposing the mandate of constitution for the state to support the rearing of the youth for
civic efficiency; (7) civic-minded citizens have called for remedial measures to curb
malpractices which flaunted our censorship and copyright laws; and lastly, (8) emergencies
corroding the moral values of the people call for measures must be adopted with dispatch…
ISSUES:
1. MAIN: WHETHER OR NOT Presidential Decree No. 1987 is unconstitutional and void
2. Petitioner’s attack on the unconstitutionality of DECREE: (1) Sec. 10 which imposes 30%
tax is a RIDER, (2) tax imposed is unlawful and oppressive restraint of trade in violation
of due process clause, (3) no legal basis for the exercise of President of the vast powers
conferred upon him by Amendment 6 of 1973 Constitution, (4) undue delegation of power,
(5) DECREE is an ex-post facto law, and (6) over regulation of video industry.

RATIO:
1. No clear violation of the Constitution was found. Presidential Decree 1987 is not
unconstitutional. The instant petition is DISMISSED. No costs.

2. Objections:
d. Constitutional requirement that “every bill shall embrace only one subject which shall
be expressed in the title thereof” is complied with if the title is comprehensive enough
to include general purposes which the statute aims to achieve, and are germane to the
subject matter expressed in the title. An act may contain any number of provisions for
as long as they are not inconsistent with the general subject. THEREFORE, tax
provision of DECREE (sec. 10) is NOT a rider, for the provision is germane to the
 subject matter. It is a regulation of the video industry by the “VIDEOGRAM
REGULATORY BOARD” as indicated in the title.
e. The power of taxation is one of unlimited force that courts scarcely venture to declare
that it is subject to any restrictions whatever. The tax imposed by the decree is not only
a regulation, but a revenue measure. It is similar to 30 percent amusement tax imposed
on the entire cost of admission ticket. The burden is on the buying public. Taxation is
the exercise of the state’s police power.
f. Amendment 6 of 1973 Constitution: “whenever in the judgment of the President xxx,
there exists a grave emergency or a threat or imminence thereof, or whenever the
interim Batasang Pambansa or the regular National Assembly fails or is unable to act
adequately on any matter for any reason that in his judgment requires immediate action,
he may, in order to meet the exigency, issue the necessary decrees, orders, or letters of
instructions, which shall form part of the law of the land.” In refutation, grave
emergencies corroding moral values of the people necessitated the measures for
dispatch.
g. It is not an undue delegation of power, for section 11 of the decree is not a delegation
to legislate, but a conferment of authority as to its implementation. ““solicit the direct
assistance of other agencies and units of the government…” Delegation is making and
enforcing the law, while conferment of authority is to execute in pursuance of the law.
h. DECREE is not an ex-post facto law. Ex-post facto is the alteration of the legal rules
of evidence. Section 15 of the DECREE, requiring videogram establishments to secure
permits and registration, raises only a prima facie presumption of violation of the
decree attached only 45 days after its effectivity, and so not retroactive in character.
i. Court does not share petitioner’s fears that video industry is a nuisance, and so, is being
over-regulated. As a relatively new industry, it has to be regulated considering the
underlying objectives of the DECREE. The promulgation of the decree did not spell
the demise of the video industry, but instead, even proliferated video establishments
after the 30% tax imposition in some places. What the petitioners seek is the necessity,
expediency, and wisdom of the DECREE which the legislative department is bound to
provide (principle of separation of powers).

CONCURRING
Section 10 PD 1987 otherwise known as Videogram Regulatory Board is not a Rider. 50% of the
tax shall accrue to the province, and the remaining 50% to the municipality.

PD 1987 not an undue delegation of legislative power. The grant in Sec. 11 soliciting the direct
assistance of agencies and other units of government is not a delegation of power to legislate but
a conferment of authority. The language of the decree wherein the authority of the BOARD to
solicit assistance from deputized agencies might be a subject of graft and corruption. However,
this will not stigmatize the DECREE to be unconstitutional. Should it occur, the aggrieved party
will not be without adequate remedy in law.