Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

Seventeenth Congress
First Regular Session

HOUSE BILL NO. 3747

Introduced by Honorable Rodante D. Marcoleta

EXPLANATORY NOTE

Since the passage of RA 8479 deregulating the price of petroleum products
including LPG, the price of the latter has more than doubled. Even as the law
mandated the Department of Energy (DOE) to monitor the international and
domestic prices of crude and petroleum products, the pricing is left to the oil/LPG
companies and their dealers and retail outlets.

While the DOE has lately been successful in persuading most companies to
implement price adjustments of liquid petroleum products in small increments, the
situation is not true for all players in the LPG business. Some players have been
noted to implement the full impact of increases in the benchmark monthly contract
price (CP) in Saudi Arabia at the beginning of the month, but only smaller
increments are implemented during times of downward CP movements.

It is recognized that domestic prices are dependent on the price in the
international market and the peso exchange rate. However, certain mechanism
may have to be put in place to protect the welfare of the consuming public from
abuse by unscrupulous local LPG industry players.

Even as liberalization of the downstream oil industry has been the policy
adopted by our government, the urgent passage of this bill is earnestly sought to
provide a mechanism to ensure reasonable prices and timely adjustments for LPG.

\

J
“ RODANTED. MARCOLE’


Republic of the Philippines
HOUSE OF REPRESENTATIVES.
Quezon City, Metro Manila

Seventeenth Congress
First Regular Session

3747
HOUSE BILL NO.

Introduced by Honorable Rodante D. Marcoleta

AN ACT
TO PROTECT THE FILIPNO CONSUMER FROM ARBITRARY
INCREASES IN THE PRICES OF LPG BEING CHARGED BY THE
PLAYERS OF THE LPG INDUSTRY, AMENDING FOR THE PURPOSE
SECTIONS 19 AND 14 OF R.A. 8479, OTHERWISE KNOWN AS
DOWNSTREAM OIL INDUSTRY DEREGULATION LAW OF 1998

Be it enacted by the Senate and House of Representatives of the Philippines in
Congress assembled:

SECTION I. Section 19 of Republic Act No. 8479 is hereby amended by
adding another paragraph to read as follows:

“Providing further, that effective immediately, the price of
LPG has to be guided by an Automatic Pricing Mechanism (APM).
Such APM shall be determined by the Energy Regulatory
Commission (ERC), afier prior notice and hearing, within six (6)
months from the affectivity of this bill,

To ensure that only safe and qualified LPG cylinders are put
in circulation, the APM shall provide for cylinder repair and

maintenance cost.”


SEC. 2. The functions of the Department of Energy-Department of
Justice (DOE-DOJ) Task Force shall be transferred to the ERC. Thus, Sec. 14 (d)
of the same law is hereby amended to read as follows:
“Any report from any person of an unreasonable rise in the
prices of LPG shall be immediately acted upon. For this purpose, the

ERC is hereby mandated to determine within thirty (30) days the

merits of the report and initiate the necessary actions warranted

under the circumstances; Provided, that nothing herein shall prevent

the ERC from investigating and/or filing the necessary complaint

moto propio.”

SEC. 3. Implementing Rules And Regulations — The ERC, in
coordination with DOE and other concerned government agencies, shall formulate
and issue the necessary implementing rules and regulations within sixty (60) days
after the effectivity of this Act.

SEC. 4. Repealing Clause ~ All laws, Presidential Decrees, executive
orders, issuances, rules and regulations or parts thereof, which are inconsistent
with the provisions of this Act are hereby repealed or modified accordingly.

SEC, Effectivity ~ This Act shall take effect fifteen (15) days after

its complete publication in at least two (2) newspapers of general circulation.

Approved,