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    Funa Vs Manila Economic and Cultural Office G.R. No. 193462 February 4, 2014

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    PCpl Harvin jay Tolentino
    1) The case involved a request by the petitioner to the Commission on Audit (COA) for a copy of the latest financial and audit report of the Manila Economic and Cultural Office (MECO). 2) The COA denied the request on the basis that MECO was not one of the agencies under its audit jurisdiction as it was not a government-owned and controlled corporation (GOCC). 3) The Supreme Court ruled that while MECO was not a GOCC, its accounts pertaining to verification fees collected for the Department of Labor and Employment and consular fees were subject to COA audit.

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    Funa Vs Manila Economic and Cultural Office G.R. No. 193462 February 4, 2014

    Uploaded by

    PCpl Harvin jay Tolentino
    34 views4 pages
    1) The case involved a request by the petitioner to the Commission on Audit (COA) for a copy of the latest financial and audit report of the Manila Economic and Cultural Office (MECO). 2) The COA denied the request on the basis that MECO was not one of the agencies under its audit jurisdiction as it was not a government-owned and controlled corporation (GOCC). 3) The Supreme Court ruled that while MECO was not a GOCC, its accounts pertaining to verification fees collected for the Department of Labor and Employment and consular fees were subject to COA audit.

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    Funa vs Manila Economic and Cultural Office G.R. No. 193462 February 4, 2014

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    1) The case involved a request by the petitioner to the Commission on Audit (COA) for a copy of the latest financial and audit report of the Manila Economic and Cultural Office (MECO). 2) The COA denied the request on the basis that MECO was not one of the agencies under its audit jurisdiction as it was not a government-owned and controlled corporation (GOCC). 3) The Supreme Court ruled that while MECO was not a GOCC, its accounts pertaining to verification fees collected for the Department of Labor and Employment and consular fees were subject to COA audit.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    34 views4 pages

    Funa Vs Manila Economic and Cultural Office G.R. No. 193462 February 4, 2014

    Uploaded by

    PCpl Harvin jay Tolentino
    1) The case involved a request by the petitioner to the Commission on Audit (COA) for a copy of the latest financial and audit report of the Manila Economic and Cultural Office (MECO). 2) The COA denied the request on the basis that MECO was not one of the agencies under its audit jurisdiction as it was not a government-owned and controlled corporation (GOCC). 3) The Supreme Court ruled that while MECO was not a GOCC, its accounts pertaining to verification fees collected for the Department of Labor and Employment and consular fees were subject to COA audit.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
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    Tolentino, harvin Jay C

    2nd yr - corporation Law

    Doctrine: corporation created by special laws or charters - shall


    governed primarily by the provision of the special laws or charters
    creating them or applicable to them, supplemented by the
    provision of this code insofar as they are applicable

    Case Title: FUNA VS MECO (G.R. NO. 193462 FEBRUARY 4,


    2014) Funa vs Manila Economic and Cultural Office G.R. No.
    193462 February 4, 2014

    Facts: On 23 August 2010, petitioner sent a letter to the COA


    requesting for a “copy of the latest financial and audit report” of the
    MECO invoking, for that purpose, his “constitutional right to
    information on matters of public concern.” The petitioner made the
    request on the belief that the MECO, being under the “operational
    supervision” of the Department of Trade and Industry (DTI), is a
    government owned and controlled corporation (GOCC) and thus
    subject to the audit jurisdiction of the COA.

    Petitioner’s letter was received by COA Assistant Commissioner


    Jaime P. Naranjo, the following day. On 25 August 2010, Assistant
    Commissioner Naranjo issued a memorandum referring the
    petitioner’s request to COA Assistant Commissioner Emma M.
    Espina for “further disposition.” In this memorandum, however,
    Assistant Commissioner Naranjo revealed that the MECO was “not
    among the agencies audited by any of the three Clusters of the
    Corporate Government Sector.”
    Issue: Whether or not MECO is a GOCC covered by the auditing
    power of COA.

    Held: No. Government instrumentalities are agencies of the


    national government that, by reason of some “special function or
    jurisdiction” they perform or exercise, are allotted “operational
    autonomy” and are “not integrated within the department
    framework.” Subsumed under the rubric “government
    instrumentality” are the following entities:

    1. regulatory agencies,

    2. Chartered institutions,

    3. government corporate entities or government instrumentalities


    with corporate powers (GCE/GICP), and

    4. GOCCs

    The Administrative Code defines a GOCC:

    (13) Government-owned or controlled corporation refers to any


    agency organized as a stock or non-stock corporation, vested with
    functions relating to public needs whether governmental or
    proprietary in nature, and owned by the Government directly or
    through its instrumentalities either wholly, or, where applicable as
    in the case of stock corporations, to the extent of at least fifty-one
    (51) per cent of its capital stock The above definition is, in turn,
    replicated in the more recent Republic Act No. 10149 or the GOCC
    Governance Act of 2011 m, to wit:

    (o) Government-Owned or -Controlled Corporation (GOCC) refers


    to any agency organized as a stock or non-stock corporation,
    vested with functions relating to public needs whether
    governmental or proprietary in nature, and owned by the
    Government of the Republic of the Philippines directly or through
    its instrumentalities either wholly or, where applicable as in the
    case of stock corporations, to the extent of at least a majority of its
    outstanding capital stock

    GOCCs, therefore, are “stock or non-stock” corporations “vested


    with functions relating to public needs” that are “owned by the
    Government directly or through its instrumentalities.” By definition,
    three attributes thus make an entity a GOCC: first, its organization
    as stock or non-stock corporation; second, the public character of
    its function; and third, government ownership over the same.

    Possession of all three attributes is necessary to deem an entity a


    GOCC.
    In this case, there is not much dispute that the MECO possesses
    the first and second attributes. It is the third attribute, which the
    MECO lacks.

    The MECO is not a GOCC or government instrumentality. It is a


    sui generis private entity especially entrusted by the government
    with the facilitation of unofficial relations with the people in Taiwan
    without jeopardizing the country’s faithful commitment to the One
    China policy of the PROC. However, despite its non-governmental
    character, the MECO handles government funds in the form of the
    “verification fees” it collects on behalf of the DOLE and the
    “consular fees” it collects under Section 2 (6) of EO No. 15, s.
    2001. Hence, under existing laws, the accounts of the MECO
    pertaining to its collection of such “verification fees” and “consular
    fees” should be audited by the COA.

    WHEREFORE, premises considered, the petition is PARTIALLY


    GRANTED. The Manila Economic and Cultural Office is hereby
    declared a non-governmental entity. However, the accounts of the
    Manila Economic and Cultural Office pertaining to: the verification
    fees contemplated by Section 7 of Executive Order No. 1022
    issued 1 May 1985, that the former collects on behalf of the
    Department of Labor and Employment, and the fees it was
    authorized to collect under Section 2(6) of Executive Order No. 15
    issued 16 May 2001, are subject to the audit jurisdiction of the
    COA.

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