Tanada v. Angara

FACTS:
The emergence on January 1, 1995 of the World Trade Organization, abetted by the membership thereto
of the vast majority of countries, has revolutionized international business and economic relations
amongst states. It has irreversibly propelled the world towards trade liberalization and economic
globalization. L
Liberalization, globalization, deregulation and privatization, the third- millennium buzz words, are
ushering in a new borderless world of business by sweeping away as mere historical relics the heretofore
traditional modes of promoting and protecting national economies like tariffs, export subsidies, import
quotas, quantitative restrictions, tax exemptions and currency controls. Finding market niches and
becoming the best in specific industries in a market-driven and export-oriented global scenario are
replacing age-old “beggar-thy-neighbor” policies that unilaterally protect weak and inefficient domestic
producers of goods and services.
In the words of Peter Drucker, the well-known management guru, “Increased participation in the world
economy has become the key to domestic economic growth and prosperity.”
In 1994, Respondent Rizalino Navarro, then Secretary of the Department of Trade and Industry
(Secretary Navarro, for brevity), representing the Government of the Republic of the Philippines, signed
in Marrakesh, Morocco, the Final Act Embodying the Results of the Uruguay Round of Multilateral
Negotiations (Final Act, for brevity).
The Uruguay Round Final Act, established the WTO Agreement, with an aims to liberalize and expand
world trade and strengthen the interrelationship between trade and economic policies affecting growth
and development.
The basic principles underlying the WTO Agreement recognize the need of developing countries like the
Philippines to “share in the growth in international trade commensurate with the needs of their economic
development.”
The members of the Philippine Senate received a letter from the President of the Philippines, submitting
the Uruguay Round Final Act for its concurrence pursuant to Section 21, Article VI I of the Constitution.
Thereafter, a draft of a proposed Resolution giving its concurrence to the WTO Agreement is enclosed.
The Final Act in brevity,
It will allegedly improve Philippine access to foreign markets, especially its major trading partners
through the reduction of tariffs on its exports particularly agricultural and industrial products. These
concessions may be availed of by the Philippines, only if it is a member of the World Trade Organization.
By GATT estimates, the Philippines can acquire additional export revenues from $2.2 to $2.7 Billion
annually under Uruguay Round. This will be on top of the normal increase in exports that the Philippines
may experience.
The Final Act will also open up new opportunities for the services sector in such areas as the movement
of personnel, cross-border supply, consumption abroad and commercial presence.
The clarified and improved rules and disciplines on anti-dumping and countervailing measures will also
benefit Philippine exporters by reducing the costs and uncertainty associated with exporting while
at the same time providing a means for domestic industries to safeguard themselves against
unfair imports.
Likewise, the provision of adequate protection for intellectual property rights is expected to attract more
investments into the country and to make it less vulnerable to unilateral actions by its trading partners
(e.g., Sec. 301 of the United States’ Omnibus Trade Law).
The members of the Philippine Senate received a letter from the President of the Philippines,
submitting the Uruguay Round Final Act for its concurrence pursuant to Section 21, Article VI I of the
Constitution.
A draft of a proposed Resolution giving its concurrence to the WTO Agreement is enclosed
PETITIONER’S ALLEGATION:
The WTO Agreement provides that “each Member shall ensure the conformity of its laws, regulations
and administrative procedures with its obligations as provided in the annexed Agreements.” Petitioner s
maintain that this undertaking “unduly limits, restricts and impairs Philippine sovereignty,
specifically the legislative power which under Sec. 2, Article VI of the 1987 Philippine Constitution is
vested in the Congress of the Philippines.
It is an assault on the sovereign powers of the Philippines because this means that Congress could not
pass legislation that will be good for our national interest and general welfare if such legislation
will not conform with the WTO Agreement, which not only relates to the trade in goods x x x but
also to the flow of investments and money x x x as well as to a whole slew of agreements on socio-
cultural matters x x x .”
More specifically, petitioners claim that said WTO provision derogates from the power to tax, which is
lodged in the Congress. And while the Constitution allows Congress to authorize the President to fix tariff
rates, import and export quotas, tonnage and wharf age dues, and other duties or imposts,
such authority is subject to “specified limits and x x x such limitations and restrictions” as Congress may
provide, as in fact it did under Sec. 401 of the Tariff and Customs Codes.
ISSUE:
RULING:
the Court recognized that “while sovereignty has traditionally been deemed absolute and all-
encompassing on the domestic level, it is, however, subject to restrictions and limitations voluntarily
agreed to by the Philippines, expressly or impliedly, as a member of the family of nations.”
By their inherent nature, treaties really limit or restrict the absoluteness of sovereignty. By their
voluntary act, nations may surrender some aspects of their state power in ex- change for greater
benefits granted by or derived from a convention or pact. After all, states, like individuals, live with
coequals, and in pursuit of mutually covenanted objectives and benefits, they also commonly agree
to limit the exercise of their otherwise absolute rights.
Thus, treaties have been used to record agreements between States concerning such widely diverse
matters as, for example, the lease of naval base, the sale or cession of territory, the termination of war, the
regulation of conduct of hostilities, the formation of alliances, the regulation of commercial relations, the
settling of claims, the laying down of rules governing conduct in peace and the establishment of
international organizations.
The sovereignty of a state therefore cannot in fact and in reality be considered absolute. Certain
restrictions enter into the picture:
(1) limitations imposed by the very nature of membership in the family of nations and
(2) limitations imposed by treaty stipulations.
One of the oldest and fundamental rules in international law is pacta sunt servanda-international
agreements must be performed in good faith. "A treaty engagement is not a mere moral obligation but
creates a legally binding obligation on the parties xxx A state which has contracted valid international
obligations is bound to make in its legislations such modifications as may be necessary to ensure the
fulfillment of the obligations undertaken."
The Court used as evidence the UN Charter and other multilateral and bilateral treaties, that involve
limitations on Philippine sovereignty. The Court concluded by ruling that “a portion of sovereignty may
be waived without violating the Constitution.” The Court has also added that:
“On the rationale that the Philippines has adopted the generally accepted principles of international law as
part of the law of the land, a portion of sovereignty may be waived without violating the Constitution.”
The Court has noted the obligation of the Philippines to adjust its laws in relation to international law: As
an integral part of the community of nations, we are responsible to assure that our government,
Constitution and laws will carry out our international obligation. Hence, we cannot readily plead the
Constitution as a convenient excuse for non-compliance with our obligations, duties and responsibilities
under international law.

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FACTS:

The Final Act in brevity,

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