L.. . 
c 
THIRTEENTH CONGRESS OF THE REPUBLIC 
First Regular Session 
OF THE PHILIPPINES 
S E N A T E  
. .  . 
~~ 
Introduced by Senator Edgardo J. Angara 
EXPLANATORY NOTE 
Political parties play a vital role in the country's quest for political and 
economic development. The political party system in the country is basically 
confined to personalities rather than issues and political platform. There have 
been many attempts to reform the orientation of our political parties in the past 
so as to veer way from the concept of traditional politics, but unfortunately they 
have not been successful because of lack of legal institutional framework to 
govern system of political parties. 
' 
Our history tells us that political parties in the Philippines are normally 
used only as political vehicles to win an election. Hence, most political aspirants 
change political parties for convenience, rather than because of conviction. This 
only shows the lack of ideological commitment of the members of party because 
they choose parties based on the rise and fall of the tide of opportunity. 
"Turncoatism" should never be encouraged nor tolerated since it only distorts 
the concept of word of honor and dignity of a leader. 
u 
It is this light that the Political Party Act should be enacted. It is 
imperative that political party system should be strengthened if we want to 
develop, achieve genuine political development and democratization. We have 
to enact laws to prevent the system of ward politics and political chameleons that 
' 
we have today. 
A Party Development Fund shall be created to provide subsidy to political 
parties of national character for their operational expenses and party building 
activities not only for electoral campaign but also for their, developmental 
programs. These funds shall be appropriated in the national budget. 
A political party may qualify to receive a portion from the Party 
Development Fund if its national candidates garnered at least 15% of the popular 
vote in the most recent general elections. 
For their part, Political parties should institute internal control 
mechanisms within political parties to promote accountability and transparency. 


The bill also encourages the political parties to raise its funds through 
Party Foundation to finance their activities so that they will develop their self- 
sufficiency and lessen their dependence on contributions from illegal sources. 
. 
The bill envisions changing the norm of having political butterflies during 
and after the election period. It aims to give importance to party ideals and 
policy agenda rather than the political pragmatism and survival. The bill 
proposes that any member of the party wanting to change the party affiliation 
after being elected on that party’s ticket, should first resign from his elective 
position and must seek a fresh mandate from the electorate. Likewise, defecting 
persons cannot be appointed nor hold any position in any public office, till after 
the expiration of the term within which they were elected. 
In general, the proposed bill hopes to transform the Philippine political 
parties from personality-oriented to issue-oriented political organizations. Thus, 
we can provide our constituents with better brand of party politics. 
In view of the urgent need to address the irregularities in the political 
party system, the passage of this bill is urgently sought. 
EDGARDO J. 
NGARA 


THIRTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
First R e p  lar Session 
S E N A T E  
S. No. 
10 
Introduced by Senator Edgardo J. Angara 
-~ 
AN ACT 
STRENTHENING THE POLITICAL PARTY SYSTEM, APPROPRIATING 
FUNDS THEREFOR, AND FOR OTHER PURPOSES 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled: 
Chapter 1 
Declaration of Policy, Purposes and Coverage 
SECTION 1. Title. - This Act shall be known as ”The Political Party 
Development Act of 2004.” 
SEC. 2. Declaration of Policy. - It is hereby declared a policy of the State 
to institutionalize and strengthen political parties as vital pillars of the country’s 
democratic system. Towards this end, the State shall institute reforms in 
campaign financing through effective and transparent mechanisms designed to 
level the playing field among all candidates and political parties during elections, 
and reduce opportunities for graft and corruption. As part of the State’s thrust to 
strengthen the political party system, it shall uphold party loyalty and adherence 
to the party’s ideological principles, platforms and programs. The State shall also 
institute measures to professionalize political parties, and make them viable 
instruments of development and good governance. 


SEC. 3. Purposes. - This Act aims to: 
a) Institutionalize reforms in the financing of electoral campaigns, so as to 
promote accountability and transparency; 
b) Provide Financial subsidies to political parties, to augment their 
expenditures for campaign purposes and for party development; 
c) Promote party loyalty and discipline; and 
d) Encourage and support continuing voters’ education and civic literacy 
programs through the political parties. 
SEC. 4. Coverage. - This Act shall apply to national political parties duly 
registered with, and certified to as such by the Commission on Elections. 
SEC. 5. Definition of Terms. - The following terms as used in this Act shall 
mean: 
a) “Accredited national political party” refers to a political party of national 
character qualified to receive subsidy for campaign purposes and 
party development, accredited for the purpose by the Commission 
based on a set of criteria provided under this Act. 
b) ”Candidate” refers to any person aspiring for, or seeking an elective 
public office, duly nominated by a political party, aggrupation, or 
coalition of parties, and who has filed a certificate of candidacy with 
the Commission. 
c) “Commission” refers to the Commission on Elections. 
d) ”Campaign Contributions” 
shall mean all forms of donations to any 
candidate, political party, aggrupation or coalition, regardless of the 
source, given before, during and after the holding of elections. It shall 
also include any gift, donation, subscription, loan, advance or deposit 
of money or anything of value, or those arising from a contract, pledge 
or agreement to contribute, whether or not legally enforceable, made for 
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the purpose of influencing the results of the elections, but shall not 
include services rendered without compensation by individuals 
volunteering a portion or all of their time in behalf of a candidate or 
political party. It shall also include the use of office space, facilities, 
equipment, office supplies and other materials and fixtures voluntarily 
donated by other persons, or allowed their use for free, the monetary 
value of which shall be assessed based on market rates prevailing in a 
particular area. 
e) ”Campaign Expenditures” shall include all types of expenses incurred, 
regardless of source, amount and purpose that relates, directly or 
indirectly, to the conduct of an electoral campaign. It involves all 
payments of money or anything of value, or a contract, promise or 
agreement to spend, for the purpose of influencing the results of the 
election. It shall include the use of office space and facilities personally 
owned by the candidate, the monetary value of the use of which shall be 
assessed based on the market rates prevailing in a particular area. 
f) ”COA” refers to the Commission on Audit. 
g) ”Disclosure requirements” refers to the duty of all candidates and political 
parties, aggrupations or coalitions to reveal the details of campaign 
contributions received by them, and the expenditures made on account 
hereof. For the accredited national political parties, ”disclosure 
requirements’’ shall include expenditures and destinations of campaign 
and party development monies given to them as their share in the State 
Subsidy Fund established under this Act. 
h) ”Donor” refers to any person, natural or juridical, who contributes money, 
property or any other form of material contribution to a candidate, 
political party, aggrupation or coalition. 
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i) "Donee" refers to any candidate, political party, aggrupation or coalition, 
or any representative acting in their behalf or interest, to whom money, 
property or any other form of contribution is made. 
"Fund" refers to the State Subsidy Fund established under this Act. 
j) 
k) "National Political Party" refers a political party registered with the 
Commission whose constituency is effectively spread across the 
geographical territory of the majority of the administrative regions of the 
Philippines. 
1) "Political Party" refers to an organized group of persons duly registered 
with the Commission, pursuing or advocating a platform, principles .and 
policies for the general conduct of government and which, as the most 
immediate means of securing their adoption and implementation, 
regularly nominates and supports its members as candidates for public 
off ice. 
m) "Potitical turncoatism" refers to the change of political party affiliation by 
any elective public official under which he was elected from the time of 
the election up to the last six (6) months before the succeeding election: 
Provided, that political turncoatism shall not apply in any of the following 
instances. 
i. 
Merger or coalition of political parties where a candidate is a 
registered member thereof; 
Abolition of political parties where a candidate is a registered 
member thereof; 
Expulsion in writing, of the registered member from his/her 
political party; and 
Resignation of any elective public official from a political party; 
Provided, That the elective public official remains independent 
ii. 
iii. 
iv. 
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during his term of office up to six (6) months before the 
succeeding election; Provided, firther, That the basis of 
determining his/ her party membership is the party of his/ her 
choice appearing in the certificate of nomination from his/ her 
party filed with the Commission. 
”State Subsidy Fund” 
refers to the fund for party development and 
campaign activities of accredited national political parties established 
under this Act. 
”Voluntary contributions” refers to the contributions to candidates and/ or 
political parties, aggrupations or coalitions to candidates and/or 
political parties, aggrupations or coalitions, from persons, natural or 
juridical, allowed under existing laws. 
Chapter 2 
Institutionalization of Political Parties 
SEC. 6. Registration as a national political party. - Any organized 
group of persons seeking registration as a national political party may file 
with the Commission a verified petition attaching thereto its constitution and 
by-laws, platform, principles, policies and general program of government. A 
verified list of its national officials, members of the executive board, or its 
equivalent , and the head of its regional, provincial and city branches and 
such other relevant information as may be required by the Commission. The 
Commission shall, after due notice and hearing, resolve the petition within 
TWENTY (20) days from the date it is submitted for decision, 
Those who are already registered as a national political party may not 
register anew. 
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SEC. 7. Definition of policy agenda and program of governance. - 
National political parties are mandated to adopt a clear policy agenda and 
program of governance consistent with their party philosophy and ideals. 
The members of the national political party shall endeavor to act in 
accordance with the defined party platform and pursue programs to fulfill 
party commitments. 
SEC. 8. Selection of Candidates. - The selection process for candidates 
of national political parties shall be democratized through the adoption of a 
process that is fair, open and transparent, and which promote the widest 
possible participation of the members of the party. 
SEC. 9. Limits OM Voluntary Contributions. - Voluntary contributions 
to any national political party shall be limited to the following amounts: 
a) A contribution from any individual shall not exceed the amount of 
One Hundred Thousand Pesos (P100,OOO.OO); and 
b) A juridical entity can contribute up to a maximum amount of One 
Million Pesos (P1,000,000.00); 
SEC. 10. Changing Political AfSiliation. - Any member of a national 
political party who changes party affiliation after being elected on the ticket of that 
party shall be deemed to have committed political turncoatism. 
SEC. 11. Penalties for Political Turncoatism. - The elected public officials 
who have committed political turncoatism shall be: 
a) 
Prohibited from running for any elective position in the next 
succeeding election immediately following the act of changing political 
party affiliation; 
Prohibited from being appointed or from holding any position in any 
b) 
public or government office for three (3) years after the expiration of 
his/ her current term; 
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c) 
Prohibited from assuming any executive or administrative position in 
his/ her new political party; and 
Directed to refund any and all amounts he/she received from his/her 
political party, plus a twenty five percent (25%) surcharge thereon. 
SEC. 12. Petition for Disqualification. - Any citizen of voting age, or any 
candidate, political party, aggrupation or coalition, may file with the Commission, 
upon the filing of the certificate of candidacy and before proclamation, a petition to 
disqualify a candidate on the ground of political turncoatism as defined in this Act. 
d) 
SEC. 13. Authorized Expenses of National Political Parties. - The amount 
that a national political party may spend for every election campaign shall be Eleven 
Pesos (P11.00) for every voter currently registered in the constituency or 
constituencies where it has official candidates. The Commission shall adjust the 
authorized expenditure as well as the authorized contributions under Section 9 
based on the Consumer Price Index every three (3) years following the effectivity of 
this Act. 
Chapter 3 
State Subsidy 
SEC. 14. 
Establishment of a State Subsidy Fund. - There is hereby 
established a State Subsidy Fund, which shall be exclusively used to augment the 
operating funds of the accredited national political parties. The Fund shall be used 
equally for two major purposes, as follows: 
a) Campaign expenditures; and 
b) Program operations and party development. 
SEC. 15. Application for Subsidy. - A registered national political party, 
which desires to be entitled to the rights and privileges as recipient of the subsidy 
provided for under this Act, may apply for the subsidy with the Commission, under 
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such rules and regulations as the Commission shall prescribe consistent with the 
eligibility criteria laid down under this Act. 
SEC. 16. Criteria for Eligibility. - The Commission shall approve the 
application for subsidy of a registered national political party based on the following 
criteria: 
a> 
Political representation, which may include the number of seats 
gained in the national legislature in the most recent national 
elections; 
Organizational strength and mobilization capability, which may 
include the number of political chapters, organizations nationwide, 
b) 
and number of active and permanent members of the party; 
Performance and track record of the party, which may include the 
number of years of existence of the party as well as the ability of the 
party to field a complete slate of candidates in the past three (3) 
national elections; and 
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d) 
Capability to implement developmental programs for their 
constituency, which may include the number of projects and 
programs of the national political parties related to voters’ 
education, information campaigns on national issues, trainings and 
other constituency-building activities. 
SEC. 17. Efsects of Approval and Acceptance of State Subsidy. - A registered 
national political party whose application for subsidy has been approved shall be 
entitled to the rights and privileges accorded under this Act. Likewise, said national 
political party shall be subject to the regulations set forth in this Act and its 
implementing rules as prescribed by the Commission. 
SEC. 18. Distribution of Funds. - The total amount of subsidy released 
annually shall be distributed as follows: 
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Up to 25% of the Fund shall be distributed equally between the 
accredited dominant majority party and the accredited dominant 
minority party: Provided, That the share of said party shall only be 
released upon actual showing that said party has raised from 
voluntary contributions an amount equal to its share of the subsidy., 
Up to 10% of the Fund may be used by the Commission exclusively for 
information campaign, 
voters education and 
comprehensive 
monitoring of this Act; and 
The balance of 
70% shall be equitably and proportionately 
apportioned among the registered national political parties in 
accordance with the eligibility criteria under Section 16 and in 
compliance with the party ethical and disciplinary code under Section 
24, hereof. 
SEC. 19. Schedule of Releases from the Fund. - For purposes of this Act, all 
releases from the Fund during a non-election year shall be used exclusively for party 
development activities and party development, respectively. 
Every accredited national political party shall submit to the Commission a 
detailed program of activities as well as the breakdown of expenditures drawn from 
the Fund by the end of December of every fiscal year. 
No accredited national political party shall be allowed to use the subsidy for 
purposes other than those indicated in this Act. 
SEC. 21. Allowable Party Development Activities. - Due to the vital role 
played by the national political parties in the country’s political development, and in 
order to promote professionalism and accountability among members of the parties, 
only the following party development activities shall be allowed to be funded out of 
the subsidy: 
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Party Administrative Staff, recruitment and training of personnel and 
headquarters operations; 
Research and policy development, including hiring of experts; 
Education and training of party members; 
Constituency outreach program, workshop and seminar; and 
Other reasonable logistical expenses essential to the necessary 
operation of the party. 
22. Allowable Campaign Expenditures. - The accredited national 
political parties are authorized to use the subsidy given to them only for the 
following campaign activities: 
a> 
Operating expenses of the party, which may include hiring of 
campaign personnel, setting up of headquarters, and other relevant 
electoral expenditures; 
, 
b) 
Traveling and accommodation expenses of the candidates and 
support personnel in the course of the campaign ; 
c) 
Information dissemination and advocacy campaigns of the political 
party; 
Production and distribution of electoral paraphernalia and other 
d) 
campaign materials; and 
Other expenditures stipulated under Section 102 of the Omnibus 
e> 
Election Code. 
Chapter 4 
Disclosures and Performance Monitoring 
SEC. 23. Audit of the Fund. - The COA shall examine the financial 
reports of the accredited national political parties on their utilization of the 
Fund. Voluntary contributions to any accredited national political party shall 
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be accounted for separately under a different set of books of accounts, which 
shall be open to inspection by the COA. 
SEC. 24. Party Ethics. - Accredited national political parties shall 
institute internal control mechanisms to promote accountability and 
transparency. 
Accredited national political parties shall likewise develop and enforce 
an internal code of conduct and ethical standards for its party members to 
uphold the values and standards of public life, and to formulate and 
implement disciplinary procedures for party members: Provided, That said 
program for internal controls, ethical standards and discipIinary procedures 
shall all be duly filed with the Commission and made available to the public. 
In addition, no accredited national political party shall sponsor and 
select a candidate who has been convicted of any criminal offense involving 
moral turpitude, electoral fraud or violence against persons. 
SEC. 25. Full Disclosure. - The national officials of every registered 
national political party shall submit a sworn statement of their assets and 
liabilities to the Commission. Said documents shall be open to public 
inspection. 
AI1 accredited national political parties shall also be required to make a 
similar public disclosure of all contributions as well as expenditures from the 
subsidy out of the fund. 
All these disclosures shall be made through the official website of the 
Commission and in a newspaper of general circulation. 
SEC. 26. Other Reports. - The following shall be reported by the 
national political parties; 
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a) A full report of expenditures and receipts incurred during the 
campaign, including those which were drawn from the Fund, if 
any; 
b) Detailed breakdown of expenditures for the party development 
activities charged against the Fund. The financial report covering 
the party development activities shall be submitted annually, at the 
end of every fiscal year. The subsidy for the succeeding year will 
not be released without the submission of the said report covering 
the preceding year; 
SEC. 27. Publication and Dissemination of Annual Reports. - The COA 
shall, based on the audit of the various disclosure reports, publish and disseminate 
annual reports on the development of political parties which shall receive subsidies 
and on the distribution, use and results of the campaign subsidies provided to 
political parties. 
SEC. 28. Publication and Dissemination of the Political Party Development 
and Campaign Subsidy Performance Reports. - The COA shall submit to Congress 
said performance report but later than June 30 of every year, and shall be made 
available to the public via internet and mass media as a guide for the citizenry in 
evaluating political parties for the purpose of participating in their program of 
activities, and in supporting, affiliating with, or joining them. 
Chapter 5 
Miscellaneous Provisions 
SEC. 29. Punishable Act. - The following acts shall be considered election 
offenses and be punishable: 
a) Misuse of funds received by national political parties both from the State 
Subsidy Fund and from voluntary contributions; 
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b) The giving of voluntary contributions which go beyond the allowable 
limit set under this Act and other existing laws; 
c) Inability without justifiable reason to account for all incoming 
contributions from whatever source; 
d) Failure to submit disclosure statements to the Commission; and 
e) False reporting or any misrepresentation in the financial statement 
reports; 
SEC. 3O.PenaZties. - a) Any candidate or official of any national political party 
who commits any of the acts mentioned in Section 29 hereof shall be liable for an 
election offense, and shall be imposed the corresponding penalty prescribed under 
the Omnibus Election Code, without prejudice to the imposition of other penalties 
under the existing laws; 
b) Any national political party which fails to comply with any of the 
documentary requirements set forth in this Act shall be subject to administrative 
sanctions by the Commission, which shall include temporary or permanent 
cancellation of the party’s registration, as well as payment of fines consistent with 
existing laws and regulations. 
SEC. 31. Appropriations. - The amount of Three Hundred Fifty Million Pesos 
(P350,000,000.00) is hereby appropriated out of the funds of the National treasury 
not otherwise appropriated for every fiscal year when national elections will be held 
and the amount of two hundred fifty million pesos (P250,000,000.00) for every year 
when no national elections will be conducted. AI1 such amounts appropriated 
pursuant to this Act shall go to the State Subsidy Fund, which shall be administered 
by the Commission. 
The Commission and the Department of Budget and Management (DBM) 
shall promulgate the necessary guidelines to facilitate the release of the funds to 
every accredited national political party. 
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SEC. 32. Lead Agency. - The Commission on Elections is hereby mandated as 
the independent regulatory agency charged with administering and enforcing the 
provisions of the Act. 
SEC. 33. Applicability. - The provisions of Batas Pambansa Blg. 881, as 
amended, otherwise known as the ”Omnibus Election Code of the Philippines,” and 
other election laws not inconsistent with this Act shall apply suppletorily. 
SEC. 34. Rules and Regulations. - The Commission, in consultation with the 
registered national political parties within one hundred twenty (120) days from 
approval, shall promulgate the necessary rules and regulations to effectively 
implement the provisions of this Act. 
SEC. 35. Repealing Clause. - All laws, orders, issuances, rules and regulations 
or parts thereof inconsistent with the provisions of this Act are hereby repealed, 
modified or amended accordingly. 
SEC. 36. Separability Clause. - If any party of this Act is held invalid or 
unconstitutional, the other parts or provisions thereof not affected thereby shall 
remain valid and effective. 
SEC. 37. Effectivity. - This Act shall take effect fifteen (15) days from its 
publication in at least two (2) national newspapers of general circulation. 
Approved, 
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