AFTER nearly 15 years, the Supreme Court en banc yesterday declared “unconstitutional” the 2005 Joint Marine Seismic Undertaking (JMSU) agreement entered into by the administration of President Gloria Arroyo with China and Vietnam, covering 142,886 square kilometers in the South China Sea, majority of which are within the Philippines’ exclusive economic zone.
The en banc voted 12-2-1 to declare the JMSU unconstitutional, with Chief Justice Alxander Gesmundo joining the majority, while Associate Justices Amy Lazaro-Javier and Rodil Zalameda dissented. Associate Justice Ramon Paul Hernando is on leave and did not take part in the proceeding.
Under the JMSU, the Philippines, China and Vietnam through their respective national oil companies agreed to a joint exploration of the South China Sea, even if 80 percent of the 142,886 square kilometers covered in the agreement is within Manila’s exclusive economic zone.
Critics of the tripartite agreement said its approval was tied to the projects worth $8 billion to be financed by loans from Beijing to fund the North Rail, South Rail and the National Broadband Network deal with China’s ZTE Corporation.
The JMSU expired in July 2008 but the petitioners then urged the SC to still rule on their plea as they reiterated that the tripartite agreement was disadvantageous to the country.
The petitioners told the SC that through the JMSU, China was able to learn of the enormous reserves of natural gas in Recto or Reed Bank located within the Philippines’ EEZ, northwest of mainland Palawan.
The High Court said the JMSU, by and among, the China National Offshore Oil Corporation (CNOOC), the Vietnam Oil and Gas Corporation (PetroVietnam), and the Philippine National Oil Company (PNOC) is unconstitutional for allowing wholly-owned foreign corporations to participate in the exploration of the country’s natural resources without observing the safeguards provided in Section 2, Article XII of the 1987 Constitution.
The case stemmed from the petition for certiorari and prohibition filed by former Bayan Muna representatives Satur Ocampo and Teddy Casiño in 2008 assailing the constitutionality of the JMSU on the grounds that it violated the constitutional provision which mandates that the exploration, development, and utilization of natural resources shall be under the full control and supervision of the State.
Joining Ocampo and Casiño in the petition were former Bayan Muna representative Neri Colmenares, the late Anakpawis representative Crispin Beltran, former Gabriela representatives Liza Maza and Luzviminda Ilagan, former Quezon representative Erin Tañada, and former senator Teofisto “TG” Guingona III.
The petitioners also argued that the JMSU was illegal as it allowed foreign corporations that are wholly-owned by China and Vietnam to undertake large-scale exploration of the country’s petroleum resources, in violation of the constitutional provision which reserves the right to exploit and utilize natural resources to Filipino citizens, or corporations or associations at least 60 percent of whose capital is owned by such citizens.
The respondents — Arroyo, then-executive secretary Eduardo Ermita, and the then-heads of the Department of Foreign Affairs, Department of Energy, and the Philippine National Oil Company-Exploration Corp. — maintained that Section 2, Article XII of the Constitution was inapplicable because it contemplates the exploration, development and utilization of natural resources, whereas the JMSU only involves pre-exploration activities.
The case was submitted for resolution in 2010.
But the Court en banc, noting that the term “exploration” pertains to a search or discovery of something in both its ordinary or technical sense, ruled that the JMSU involves the exploration of the country”Ÿs natural resources, particularly petroleum.
Citing part of the JMSU, which states the parties “expressed desire to engage in a joint research of petroleum resource potential of a certain area of the South China Sea as a pre-exploration activity,” the SC held it is clear that the tripartite agreement was executed for the purpose of determining if petroleum exists in the agreement area.
“That the parties designated the joint research as a pre-exploration activity is of no moment. Such designation does not detract from the fact that the intent and aim of the agreement is to discover petroleum which is tantamount to exploration,” the decision penned by Associate Justice Samuel Gaerlan said.
The Court further held that as the JMSU involves the exploration of the country’s petroleum resources, it falls within the ambit of Section 2, Article XII of the Constitution.
