Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ____ 
Introduced by HON. LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR. 
EXPLANATORY NOTE 
This proposed measure seeks the amendment of Republic Act No. 9497 or the creation of the 
Civil Aviation Authority of the Philippines (CAAP) in view of the technical report of the United 
States Federal Aviation Authority (FAA) has cited 23 "critical elements" that should be addressed 
for the improvement of the country's aviation status, namely, fine-tuning of the Philippine Civil Air 
Regulations. This measure proposes to amend RA 9497, specifically to: 
1. Increase the term of Director General (DG) to a fixed term of eight (8) years to ensure 
continuity in the civil aviation system, the promotion, development and regulation of the 
technical, operational, safety, and aviation security functions by insulating the DG from 
changes of administration; 
2. Update the composition of the CAAP Board of Directors to include private sector 
representatives in order to strengthen the safety and oversight structure of the Board;
3. Exempt CAAP from the coverage of the GCG law and the Salary Standardization Law, as 
their functions are distinctly and highly technical in nature as compared to those performed 
by other "government employees"; and
4. Enhance fiscal autonomy of CAAP by exempting them from the coverage of Republic Act 
No. 7656 or the Dividend Law to maximize the use of the revenues generated by CAAP.
With the foregoing, we seek to strengthen CAAP as the country's designated civil aviation 
authority for the development of the aviation industry. 
In view of the foregoing, passage of this bill is earnestly sought. 
LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR. 
May 15, 2023
9:00 am
8096


Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ____ 
Introduced by HON. LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR. 
AN ACT 
STRENGTHENING THE CIVIL AVIATION AUTHORITY OF THE PHILIPPINES, 
AMENDING FOR THE PURPOSE REPUBLIC ACT 9497, OTHERWISE KNOWN AS 
THE CIVIL AVIATION AUTHORITY ACT OF 2008 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
SECTION 1. Section 2 of Republic Act No. 9497, otherwise known as the “Civil Aviation 
Authority Act of 2008”, is hereby amended to read as follows: 
"SEC. 2. Declaration of Policy. - It is hereby declared the policy of the 
State to provide safe and efficient air transport and regulatory services in 
the Philippines by providing for the creation of a civil aviation authority 
with jurisdiction over the restructuring of the civil aviation system, the 
promotion, development and regulation of the technical, operational, 
safety, and aviation security functions under the civil aviation authority IN 
FURTHERANCE OF THE OBLIGATIONS OF THE PHILIPPINES TO 
THE INTERNATIONAL COMMUNITY AS CONTRACTING STATE TO 
THE 
CONVENTION 
ON 
INTERNATIONAL 
CIVIL 
AVIATION, 
COMMONLY KNOWN AS THE CHICAGO CONVENTION. THE 
AUTHORITY SHALL COORDINATE WITH OTHER GOVERNMENT 
8096


 
 
AGENCIES 
IN 
ADVANCING 
AVIATION 
SECURITY 
IN 
THE 
PHILIPPINES. 
 
TOWARDS THIS END, THE GOVERNMENT SHALL EXTEND ALL 
MEANS AND MECHANISMS NECESSARY FOR THE AUTHORITY TO 
FULFILL ITS VITAL TASK OF PROMOTING AND ENSURING SAFE 
AND EFFICIENT AIR TRANSPORT. 
 
IN VIEW OF THE CRUCIAL ROLE, AND THE NATURE, POWERS 
AND FUNCTIONS OF THE AUTHORITY, AS A GOVERNMENT 
INSTRUMENTALITY WITH CORPORATE POWERS, IT SHALL 
ENJOY FISCAL AND ADMINISTRATIVE AUTONOMY." 
 
SEC. 2. Insert the following definitions in Section 3 of the same Act, to read as follows 
and renumber the sub-sections therein accordingly: 
 
"(Q) AIR NAVIGATION CHARGES - REFERS TO ALL OPERATIONAL 
CHARGES FOR THE USE OF ENROUTE AND AIRPORT/TERMINAL 
NAVIGATION FACILITIES AND SERVICES PROVIDED BY THE CIVIL 
AVIATION AUTHORITY OF THE PHILIPPINES TO AIRCRAFT ON 
INTERNATIONAL, 
DOMESTIC 
AND 
GENERAL 
AVIATION 
OPERATIONS FLYING INTO AND OUT OF AIRPORTS IN THE 
REPUBLIC OF THE PHILIPPINES, AND AIRCRAFT OVERFLYING 
THE MANILA FLIGHT INFORMATION REGION, WITHOUT LANDING 
AT ANY PHILIPPINE AIRPORT;"  
x x x 
"(JJ) COMMERCIAL AIR TRANSPORT OPERATION - AN AIRCRAFT 
OPERATION INVOLVING THE TRANSPORT OF PASSENGERS, 
CARGO OR MAIL FOR REMUNERATION OR HIRE;" 
 
SEC. 3. Section 3 (eee) and (fff) of the same Act is amended to read as follows: 


 
 
 
"(EEE) LANDING AND TAKEOFF FEES - refers to [all charges for the 
use of any landing strip or runway by any aircraft landing or taking off at 
an aerodrome] FEES CHARGED FOR THE USE OF AIRCRAFT OF 
THE AIRPORT FACILITIES AND SERVICES FOR LANDING AND 
TAKE-OFF;" 
 
"(FFF) [Terminal] PARKING Fees — refers to [charges for parking at or 
near the ramp, terminal area, or building, for purposes of loading or 
unloading passengers and/or cargo] ALL FEES CHARGED TO THE 
AIRCRAFT FOR THE USE OF FACILITIES AND SERVICES FOR 
PARKING AT THE TERMINAL APRON OR REMOTE PARKING 
AREAS FROM THE TIME OF LANDING UP TO THE TIME OF 
TAKE-OFF;" 
 
SEC. 4. Section 4 of the same Act is hereby amended to read as follows: 
 
"SEC. 4. Creation of the Authority. - There is hereby created an 
independent regulatory body with quasi-judicial and quasi-legislative 
powers and possessing corporate attributes to be known as the Civil 
Aviation Authority of the Philippines (CAAP), hereinafter referred to as 
the "Authority" attached to the Department of Transportation (DOTr) 
SOLELY for the purpose of policy coordination. For this purpose, the 
existing Air Transportation Office created under the provisions of 
Republic Act No. 776, as amended, is hereby abolished. 
 
THE AUTHORITY SHALL BE EXEMPT FROM THE PROVISIONS OF 
REPUBLIC ACT NO. 10149, OTHERWISE KNOWN AS THE GOCC 
GOVERNANCE ACT OF 2011 AND FROM THE JURISDICTION OF 
THE GOVERNANCE COMMISSION FOR GOVERNMENT-OWNED OR 
CONTROLLED CORPORATION: PROVIDED, HOWEVER, THAT THE 


 
 
AUTHORITY SHALL BE REQUIRED TO COMPLY WITH THE 
DISCLOSURE REQUIREMENTS IN SECTION 25, CHAPTER V OF 
REPUBLIC ACT NO. 10149 AND MAY BE SUBJECT TO THE 
SPECIAL AUDIT UPON THE DIRECTIVE OF THE COMMISSION ON 
AUDIT; 
PROVIDED, 
FURTHER, 
THAT 
NO 
PERFORMANCE 
INCENTIVE, BONUS, ANY KIND OF ADDITIONAL BENEFIT NOT 
PRESCRIBED UNDER THE LAW SHALL BE GRANTED UNLESS 
THE AUTHORITY HAS FULLY PAID ALL TAXES FOR WHICH IT IS 
LIABLE. 
Xxx 
 
(a] [Establishment of Authority Headed by a] APPOINTMENT AND 
TERM OF OFFICE Director General - The Authority shall be headed by 
a Director General of Civil Aviation, referred to in this Act as the "Director 
General," who [shall be appointed by the President of the Philippines 
and] shall be responsible for all NON-ECONOMIC ASPECTS OF civil 
aviation in the Philippines and the administration of this Act. 
NOTWITHSTANDING THE PROVISIONS OF REPUBLIC ACT 10149, 
[T] the Director General shall be appointed BY THE PRESIDENT OF 
THE PHILIPPINES based on the qualifications herein provided and shall 
have a [tenure] TERM of office for a period of [four (4))] EIGHT (8) 
YEARS years [. His appointment may be extended for another 
non-extendible term of four (4) years] and shall only be removed for 
cause in accordance with the rules and regulations prescribed by the 
Civil Service Commission. IN CASE THE DIRECTOR GENERAL FAILS 
TO COMPLETE HIS TERM, HIS SUCCESSOR SHALL ONLY SERVE 
FOR THE UNEXPIRED PORTION OF THE TERM OF HIS 
PREDECESSOR. 
 
THE PRESIDENT OF THE PHILIPPINES SHALL APPOINT THE 
DIRECTOR GENERAL FROM A SHORTLIST OF THREE NOMINEES 


 
 
PREPARED BY THE BOARD OF DIRECTORS CONSTITUTED AS A 
SEARCH COMMITTEE COMPOSED OF FIVE MEMBERS THEREOF 
WHO SHALL RECEIVE AND EVALUATE NOMINATIONS. NO 
INCUMBENT DIRECTOR GENERAL SHALL BE A MEMBER OF THE 
SEARCH COMMITTEE." 
 
xxx” 
 
SEC. 5. Section 5 of the same Act is hereby amended to read as follows: 
 
"SEC. 5. Composition of the Board Members. — The corporate powers 
of the Authority shall be vested in a board, which is composed of [seven 
(7)] NINE (9) members: 
 
(a) The Secretary of the Department of Transportation [and 
Communications] shall act as chairman ex officio; 
(b) The Director General of Civil Aviation (DGCA) shall automatically 
be the vice chairman of the Board;  
(c) The Secretary of Finance; 
(d) The Secretary of Foreign Affairs;  
(e) The Secretary of Justice; 
(f) The Secretary of the Interior and Local Government; [and] 
(g) The Secretary of the Department of Labor and Employment; 
(h) THE SECRETARY OF THE DEPARTMENT OF TOURISM; 
(i) THE SECRETARY OF THE DEPARTMENT OF NATIONAL 
DEFENSE; AND 
(j) TWO (2) REPRESENTATIVES FROM THE PRIVATE SECTOR 
TO BE APPOINTED BY THE PRESIDENT OF THE PHILIPPINES: 
PROVIDED, THAT NO PERSON SHALL BE APPOINTED AS A 
MEMBER OF THE BOARD UNLESS HE IS A FILIPINO CITIZEN 
OF GOOD MORAL CHARACTER OF UNQUESTIONABLE 


 
 
INTEGRITY, AND RECOGNIZED COMPETENCE IN THE FIELD 
OF AVIATION, AERONAUTICAL ENGINEERING, ECONOMICS, 
LAW, AND INTERNATIONAL RELATIONS AND MANAGEMENT, 
OR RELATED FIELDS. 
 
The Directors listed under subsections (a) to [(g)] (I) shall be ex officio 
members of the Board of Directors: Provided, That, in the absence of the 
Director appointed in subsections (c) to [(g)] (I), the Director concerned 
shall designate WITH FULL POWER AND AUTHORITY, IN WRITING, 
the officer [next in rank to him] WHO SHALL BE AT LEAST AN 
ASSISTANT SECRETARY, in his department or office to act on his 
behalf as a Director." 
 
SEC. 6. Section 8 of the same Act is hereby amended to read as follows: 
 
"SEC. 8. Quorum. — The presence of at least [four (4)] SIX (6) members 
of the Board shall constitute a quorum and the majority vote of [three (3)] 
FOUR (4) members in a meeting where a quorum is present shall be 
necessary for the adoption of any rule, ruling, order, resolution, decision 
or other act of the Board in the exercise of its functions. 
 
SEC. 7. Section 9 of the same Act is hereby amended to read as follows: 
 
"SEC. 9. Qualifications of Director General. - No person shall be 
appointed [or designated] as the Director General unless he is a Filipino 
citizen, at least thirty-five (35) years of age, of good moral character, 
unquestionable integrity, recognized competence and a degree holder 
with at least five (5) years supervisory or management experience in the 
field of aviation." 
 
SEC. 8. Section 10 of the same Act is hereby amended to read as follows: 


 
 
 
"SEC. 10. Board Meetings. — The Board shall meet regularly once a 
month and may hold special meetings to consider urgent matters upon 
call of the Chairman or upon the initiative of [four (4)] SIX (6) members. 
Internal rules of procedure in the conduct of Board meetings shall be as 
prescribed by the Board." 
 
SEC. 9. Section 12 of the same Act is hereby amended to read as follows: 
 
"SEC. 12. Personnel. - [Qualified existing personnel of the Air 
Transportation Office (ATO) shall be given preference in the filling up of 
plantilla positions created in the Authority, subject to existing civil service 
rules and regulations.] 
 
THE DIRECTOR GENERAL SHALL EXERCISE APPOINTING AND 
DISCIPLINING 
POWERS 
OVER 
ALL 
PERSONNEL 
OF THE 
AUTHORITY. 
 
ALL POSITIONS IN THE AUTHORITY SHALL BE GOVERNED BY A 
COMPENSATION, POSITION CLASSIFICATION SYSTEM, AND 
QUALIFICATION STANDARDS APPROVED BY THE BOARD OF 
DIRECTORS BASED ON A COMPREHENSIVE JOB ANALYSIS AND 
AUDIT OF ACTUAL DUTIES AND RESPONSIBILITIES. THE 
AUTHORITY SHALL THEREFORE BE EXEMPT FROM EXISTING 
LAWS, 
RULES 
AND 
REGULATIONS 
ON 
COMPENSATION, 
POSITION CLASSIFICATION, AND QUALIFICATION STANDARDS. IT 
SHALL, HOWEVER, ENDEAVOR TO MAKE ITS SYSTEM CONFORM 
AS CLOSELY AS POSSIBLE WITH THE PRINCIPLE UNDER 
REPUBLIC ACT NO. 6758, AS AMENDED." 
 
SEC. 10. Section 15 of the same Act is hereby amended to read as follows: 


 
 
 
"SEC. 15. Fiscal Autonomy. — The Authority shall enjoy fiscal autonomy. 
All moneys earned by the Authority from the collection/levy of any and all 
such fees, charges, dues, assessments and fines it is empowered to 
collect/levy under this Act shall be used solely to fund the operations of 
the Authority. FOR THIS PURPOSES, THE AUTHORITY SHALL BE 
EXEMPT FROM THE PROVISIONS OF 5 REPUBLIC ACT No. 7656 
OR THE DIVIDEND LAW. 
 
The utilization of any funds coming from the collection and/or levy of the 
Authority shall be subject to the examination of the Congressional 
Oversight Committee (COCAAP). 
 
SEC. 11. Section 18 of the same Act is hereby amended to read as follows: 
 
"SEC. 18. Compensation and Other Emoluments of Authority Personnel. 
- Within six (6) months from the effectivity of this Act, the Board shall 
determine the new schedule of salaries of the employees of the Authority 
subject to the compliance with the existing compensation laws, 
CONSISTENT WITH THE PROVISIONS UNDER SECTION 5 HEREOF, 
AND REVISE THE SAME FROM TIME TO TIME AS IT MAY DEEM 
NECESSARY [Provided, That the Board shall determine and fix the 
compensation, and fringe benefits of employees holding technical 
positions that are not common to the other agencies of the government 
which shall be specified in the Implementing Rules and Regulations]. 
THE BOARD SHALL PROVIDE ANNUAL REVIEWS OR INCREASES 
BASED ON PRODUCTIVITY." 
 
SEC. 12. A new section 18-A is hereby inserted to read as follows: 
 
"SEC. 18-A. MANAGEMENT OFFICIALS AND EMPLOYEES; MERIT 


 
 
SYSTEM - THE BOARD SHALL ESTABLISH A HUMAN RESOURCES 
MANAGEMENT 
SYSTEM, 
WHICH 
SHALL 
PROMOTE 
PROFESSIONALISM AT ALL LEVELS OF THE AUTHORITY IN 
ACCORDANCE WITH SOUND PRINCIPLES OF MANAGEMENT. 
 
A PROGRESSIVE COMPENSATION STRUCTURE, BASED ON, AND 
EQUIVALENT TO THE STANDARDS OF THE AVIATION INDUSTRY, 
AS PRACTICED AND OBSERVED IN THE INTERNATIONAL 
AVIATION INDUSTRIES, INCLUDING THE STANDARDS SET BY THE 
INTERNATIONAL CIVIL AVIATION ORGANIZATION, SHALL BE 
ADOPTED AS AN INTEGRAL COMPONENT OF THE AUTHORITY'S 
HUMAN RESOURCES PROGRAM." 
 
SEC. 13. A new section 18-B is hereby inserted to read as follows: 
 
"SEC. 18-B. EXTRA COMPENSATION. - ALL RATED AND/OR 
LICENSED AIRMEN AND SUCH OTHER PERSONS OF THE 
AUTHORITY WHO MAY BE AUTHORIZED TO BOARD, UNDERTAKE 
OR PERFORM REGULAR AND FREQUENT FLIGHTS IN THE 
PERFORMANCE OF THEIR DUTIES, SHALL RECEIVE, UPON 
APPROVAL OF THE AUTHORITY, IN ADDITION TO THEIR BASE PAY, 
AN 
INCREASE 
IN 
COMPENSATION 
OF 
AT 
LEAST 
FIFTY 
PERCENTUM (50%) OF THEIR RESPECTIVE BASE PAY: PROVIDED, 
HOWEVER, THAT THE NUMBER OF HOURS ACTUALLY FLOWN BY 
SUCH AIRMEN AND AUTHORIZED PERSONNEL SHALL NOT BE 
LESS THAN FOUR (4) PER MONTH: PROVIDED, FURTHER, THAT 
THE AFOREMENTIONED INCREASE IN COMPENSATION SHALL BE 
MANDATORY ONLY IN THE FIRST INSTANCE FROM THE 
EFFECTIVITY OF THIS ACT: PROVIDED, FINALLY, THAT FUTURE 
MANDATORY INCREASES IN THE COMPENSATION OF THE RATED 
AND/OR LICENSED AIRMEN AND SUCH OTHER PERSONS OF THE 


 
 
AUTHORITY WHO MAY BE AUTHORIZED TO UNDERTAKE OR 
PERFORM 
REGULAR 
AND 
FREQUENT 
FLIGHTS 
IN 
THE 
PERFORMANCE OF THEIR DUTIES, MAY BE INCREASED BY THE 
AUTHORITY ONLY IF IT HAS SUFFICIENT BUDGET FOR THE SAME 
AND IF IT WILL SERVE THE INTEREST OF THE AVIATION 
INDUSTRY AS A WHOLE." 
 
SEC. 14. A new section 18-C is hereby inserted to read as follows: 
 
"SEC. 18-C. EMPLOYMENT OF PERSONS FOR CONFIDENTIAL, 
HIGHLY TECHNICAL AND POLICY DETERMINING POSITIONS - THE 
DIRECTOR 
GENERAL 
MAY, 
MAKE 
APPOINTMENTS 
TO 
CONFIDENTIAL, HIGHLY TECHNICAL, AND POLICY DETERMINING 
POSITIONS AS MAY BE REQUIRED BY THE FUNCTIONS AND 
RESPONSIBILITIES OF THE OFFICE." 
 
SEC. 15. Section 21 of the same Act is hereby amended to read as follows: 
 
"SEC. 21. Policies. - In the exercise and performance of its powers and 
duties under this Act, the Authority shall consider the following, among 
other things, as being in the public interest and in accordance with the 
public convenience and necessity: 
 
(a) x x x; 
(F) THE OBLIGATIONS OF THE PHILIPPINES AS A CONTRACTING 
STATE TO THE CONVENTION ON INTERNATIONAL CIVIL AVIATION, 
COMMONLY KNOWN AS THE CHICAGO CONVENTION." 
 
SEC. 16. Section 24 of the same Act is hereby amended and its subsections duly 
renumbered, as follows: 
 


 
 
"SEC. 24. Powers of the Board. - The Board shall have the following 
general powers: 
 
(a) x x x; 
(d) ANY LAW TO THE CONTRARY NOTWITHSTANDING, ORGANIZE, 
RE-ORGANIZE, AND [D]determine the organizational structure of the 
Authority in accordance with the provisions of this Act, establish a human 
resources management system based on merit and fitness, CREATE, 
TRANSFER, RE-ALIGN AND ABOLISH OFFICES AND POSITIONS, 
and adopt a rational compensation and benefits scheme EQUIVALENT 
TO THE STANDARDS SET BY THE INTERNATIONAL CIVIL 
AVIATION ORGANIZATION (ICAO); 
 
[(e) Exercise appellate powers on any decisions, findings and rulings of 
the Director General, to issue subpoena ad testificandum or subpoena 
duces tecum requiring the attendance and testimony of witnesses in any 
matter or inquiry pending before the Board and require the production of 
books, papers, contracts, agreements and all other documents 
submitted for purposes of this section to be under oath and verified by 
the person in custody thereof as to the truth and correctness of data 
appearing in such books, papers, tariffs, contracts, agreements, and all 
other documents;] 
 
[(f) Exercise appellate powers to order the taking of depositions in any 
proceeding, or investigation, pending before the Board at any stage of 
such proceeding or investigation;] 
 
x x x 
 
[(j) Promulgate rules and regulations as may be necessary in the interest 
of safety in air commerce pertaining to the issuance of the airman’s 


 
 
certificate including the licensing of operating and mechanical personnel, 
type certificate for aircraft, aircraft engines, propellers and appliances, 
airworthiness certificates, air carrier operating certificates, air agency 
certificates, navigation facility and aerodrome certificates; air traffic 
routes; radio and aeronautical telecommunications and air navigation 
aids; aircraft accident inquiries; aerodromes, both public and private 
owned; construction of obstructions to aerodromes; height of buildings; 
antennae and other edifices; registration of aircrafts; search and rescue; 
facilitation of air transports; operations of aircrafts, both for domestic and 
international, including scheduled and non-scheduled; meteorology in 
relation to civil aviation; rules of the air; air traffic services; rules for 
prevention of collision of aircrafts; identification of aircraft; rules for safe 
altitudes of flight; and such other rules and regulations, standards, 
governing other practices, methods and/or procedures as the Director 
General may find necessary and appropriate to provide adequately for 
safety regularity and efficiency in air commerce and air navigation;] 
 
x x x 
 
[(m) Adopt a system for the registration or aircraft as hereinafter 
provided;] 
 
x x x 
 
(q) [Upon its own initiative or the recommendation of the Director 
General or an application of a private person, grant exemption from the 
requirements of observing rules or regulations issued in accordance with 
this Act: Provided, That said grant of exemption is not prejudicial to flight 
safety;] APPROVE POLICY ON LOCAL AND FOREIGN TRAVEL, AND 
THE CORRESPONDING EXPENSES, ALLOWANCES, PER DIEMS 
OF OFFICERS, EMPLOYEES, AGENTS OF THE AUTHORITY, 


 
 
NOTWITHSTANDING 
THE 
PROVISIONS 
OF 
PRESIDENTIAL 
DECREE NO. 1177, EXECUTIVE ORDER 292, EXECUTIVE ORDER 
248, AS AMENDED, EXECUTIVE ORDER 298, AND SIMILAR LAWS; 
 
(r) [Formulate rules and regulations concerning compliance of the carrier 
and the public for the safe transport of goods and materials by air 
pursuant to international standards or Annexes to the Chicago 
Convention] EXERCISE THE POWER OF EMINENT DOMAIN FOR 
THE PURPOSE OF THIS ACT IN THE MANNER PROVIDED BY LAW, 
PARTICULARLY, 
THE 
PREREQUISITES 
OF 
TAKING 
OF 
POSSESSION AND THE DETERMINATION AND PAYMENT OF JUST 
COMPENSATION; and 
 
(s) [In coordination with the appropriate government agency tasked to 
provide airport security, shall: 
 
(1) Prescribe reasonable regulation requiring that all passengers 
and all property intended to be carried in the aircraft cabin in 
commercial air transport be screened by weapon detecting 
procedure or facilities employed or operated by employees or 
agents of the air operator or foreign air operator prior to boarding the 
aircraft for such transportation; 
 
(2) Prescribe such other reasonable rules and regulations requiring 
such parties, methods and procedures as the Director General may 
find necessary to protect persons and property aboard aircraft 
operating in commercial air transport against acts of criminal 
violence and aircraft piracy; and 
 
(3) To the extent practicable, require uniform procedures for the 
inspection, detention, and search of persons and property in 


 
 
domestic commercial air transport and international commercial air 
transport to assure their safety and to assure that they will receive 
courteous and efficient treatment by air operators and their agents 
and employees.] 
 
PERFORM SUCH ACTS, THRU THE DIRECTOR GENERAL OR 
APPROPRIATE OFFICE, CONDUCT SUCH INVESTIGATION IN 
THE PERFORMANCE OF ITS QUASIJUDICIAL FUNCTIONS, AS 
IT 
SHALL 
DEEM 
NECESSARY 
TO 
CARRY 
OUT 
THE 
PROVISIONS OF THIS ACT. IN EXERCISING THE POWERS 
GRANTED UNDER THIS ACT, THE BOARD SHALL GIVE FULL 
CONSIDERATION TO THE REQUIREMENTS OF NATIONAL 
DEFENSE, COMMERCIAL AND GENERAL AVIATION, AND TO 
THE PUBLIC RIGHT OF TRANSIT THROUGH NAVIGABLE 
AIRSPACE." 
 
SEC. 17. Section 25 is hereby amended to read as follows: 
 
"SEC. 25. Issuance of Rules and Regulations. - The [Board in 
consultation with the] Director General, shall issue and provide for the 
enforcement of such orders, rules and regulations as may be necessary 
to give effect to the provisions of this Act. All rules and regulations issued 
in accordance with the provisions of this Act shall be formally 
promulgated and periodically reviewed and updated in accordance with 
the requirements of the Administrative Code of the Philippines or any 
amendment or successor thereto and the International Civil Aviation 
Organization Standards and Recommended Practices. Pending the 
promulgation of such new rules and regulations, the current rules and 
regulations of the ATO shall continue to apply." 
 
SEC. 18. Section 26 of the same Act is hereby amended to read as follows: 


 
 
 
"SEC. 26. Setting of Charges and Fees. - The Board, after consultation 
with the Director General, and after public hearing, shall determine, fix, 
impose, collect or receive reasonable charges, fees, dues or 
assessments in respect of aviation certificates, licenses and all other 
authorizations or permissions authorized to be issued under this Act and 
all services performed by the Authority BASED ON THE PRINCIPLE OF 
COST RECOVERY AT AN AGGREGATE LEVEL. All charges and fees 
shall be formally promulgated in accordance with the requirements of the 
Administrative Code of the Philippines or any amendment or successor 
thereto. [Pending the promulgation of such new schedule of charges and 
fees, the current charges and fees of the ATO shall continue to apply].” 
 
SEC. 19. Section 27 of the same Act is hereby amended to read as follows: 
 
"SEC. 27. Issuance of Rules of Procedure and Practice. - The [Board 
may authorize the] Director General [to] shall issue or amend rules of 
procedures and practice BEFORE THE AUTHORITY IN RELATION TO 
ITS REGULATORY FUNCTION as may be required to be issued 
pursuant to the provisions of this Act or issue and adopt rules and 
regulations [and other] TO IMPLEMENT THE REGULATORY issuances 
of the ICAO. [Pending the promulgation of such new rules of procedures 
and practice, current rules of procedures and practices of the ATO shall 
continue to apply.]" 
 
SEC. 20. Section 28 of the same Act is hereby amended to read as follows:  
 
"SEC. 28. Appellate [Powers] JURISDICTION - [The Board, on an 
appeal properly taken by an interested party from a decision, judgment 
or order of the Director General, shall have the power to: 
(a) Review, confirm, modify, revise, amend or reverse, as the case 


 
 
may be, decisions, judgments and/or orders of the Director General; 
(b) Confirm, remit, mitigate, increase or compromise, as the case 
may be, fines imposed by the Director General pursuant with the 
provisions of this Act; and 
(c) Review, confirm, modify, revise, amend or reverse, as the case 
may be, impositions by the Director General of liens on personal 
and real properties of entities, persons, corporations or partnerships 
in default, or those who have failed to perform their obligations 
pursuant to rules and regulations promulgated under this Act, or 
those who shall have failed to pay the fines or other pecuniary 
penalties for violation thereof. 
 
In no case that the Director General shall participate in the hearing and 
adjudication of an appealed case before the Board where the subject of 
appeal is a judgment or decision rendered by his office. In such case, it 
requires four (4) concurring votes of the members of the Board who 
actively participated in the deliberation of the appealed case before the 
judgment or decision of the Director General can be modified or 
reversed.] 
 
ALL DECISIONS, RULINGS, RESOLUTIONS OF THE BOARD 
AND THE DIRECTOR GENERAL SHALL BE APPEALABLE TO 
THE COURT OF APPEALS." 
 
SEC. 21. Section 40 of the same Act is hereby amended to read as follows: 
 
"SEC. 40. Creation of Flight Standards Inspectorate Service. - (a) The [Board, 
other than the offices it shall create in furtherance of this Act, shall establish a 
permanent office known as the] Flight Standards Inspectorate Service (FSIS) 
[that] will assist the Director General in carrying out the responsibilities of his 
office for certification and ongoing inspections of aircraft, airmen and air 


 
 
operators. 
 
The FSIS shall perform the following functions; 
 
(1) Airworthiness inspection; 
(2) Flight operations inspection and evaluation; and 
(3) Personnel licensing."  
 
[Furthermore the Board shall create, but not limited to, the following offices 
which will provide support to the functions of the FSIS, namely: Aircraft 
Registration, Aircraft Engineering and Standards, Airmen Examination Board 
and Office of the Flight Surgeon.] 
 
SEC. 22. Section 73 of the same Act is hereby amended to read as follows: 
 
"SEC. 73. Statutory Lien AND POWER TO DETAIN. - The Director General 
[,after complying with the required legal formalities provided by law,] shall have 
the power to impose lien on AND DETAIN aircraft and machinery: 
 
(a) If the charges and other fees are not paid in full on due date or any part 
of the charges or the late payment penalty thereto remains unpaid; and 
(b) Failure to pay administrative fines arising from violation of any rules and 
regulations promulgated by the Authority." 
 
SEC. 23. Separability Clause. – If any provision of this Act is declared invalid or 
unconstitutional, the other provisions not affected thereby shall continue to be in full force 
and effect. 
 
SEC. 24. Repealing Clause. – All laws, decrees, executive orders, rules and regulations 
and other issuances or part thereof, which are inconsistent with this Act, are hereby 
repealed, amended, or modified accordingly. 


 
 
 
SEC. 25. Effectivity Clause. – This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in any newspaper of the general circulation.  
 
Approved,