THIRTEENTH CONGRESS 
OF THE PHILIPPINE 
First Regular Session 
D 
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Introduced by Senator S. R. OsmeAa 111 
EXPLANATORY NOTE 
The transportation problem is one of the heaviest burdens which slow 
down the growth of major Philippine cities and urban centers today. On one 
hand, congestion is 
rendering 
the 
road network 
inefficient, 
as vehicle 
population rapidly exceed the limit that can be realistically accommodated. On 
the other hand, the long lines of commuters waiting for a ride, or the congestion 
problem in bus stops is a clear indication that the existing public transport 
system is insufficient to serve the needs of the commuting public. 
No abatement in the near to medium term can be expected in the traffic 
congestion and transportation problems of Metro Manila and urban centers, as 
population density uninterruptedly continues to be fed by incremental births and 
immigration from 
the rural 
areas, outpacing 
the expansion of 
transport 
facilities. 
This bill proposes the creation of a Mass Transport Authority which will 
be vested with the mandate to plan, coordinate, control, supervise and 
regulate all the different mass transit modes in the Metro Manila and other 
urban areas. The Authority will bridge the existing gap of defining the 
priorities over competing mass transit projects from the general public 
welfare perspective, and of seeking out creative ways of addressing the current 
problems. 
In view of the foregoing, the immediate approval of this bill is earnestly 
requested. 
YL 
SERGJO OSMENA 111 
Senator 


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THIRTEENTH CONGRESS OF THE REPUBLI 
First Regular Session 
OF THE PHILIPPINE 
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Introduced by Senator S. R. OsmeAa 111 
AN ACT 
CREATING THE MASS TRANSIT AUTHORITY AND APPROPRIATING 
FUNDS THERE‘FORE 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
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SECTION 1. Shod Title. - This Act shall be known as the “Mass Transit 
2 Authority Act”. 
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SEC. 2. Declaration of Policy. - It is hereby declared the policy of the 
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State to provide and maintain an adequate, efficient, inexpensive, convenient 
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and reliable mass transport system encompassing all modes of transportation 
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and with a standard of service consistent with the total range of urban needs, 
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amenities and resources; to encourage development of patronage of common 
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carrier modes which require less energy and less road space while transporting 
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and moving the maximum volume of adequate and efficient transit service; to 
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foster sound economic conditions within the transportation industry and among 
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the several modes of transport, in order that a healthy, dynamic, and strong 
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private sector shall interact effectively by performing functions and pursuing 
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priorities for which each is best suited and, at the same time, reinforcing and 
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complementing each other 
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SEC. 3. Definition of Terms. - As used in this Act, the following terms 
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shall have the meaning stated below: 
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a) 
Mass transit - transit system with fixed routes and centrally 
synchronized schedules, available for use by all persons who pay the established 
fare. It shall include buses, rail transits and other rapid land transits. 
b) 
c) 
Authority - the Mass Transit Authority. 
Mass Transit Operator - Any person or entity authorized by the 
Mass Transit Authority and the Land Transportation Franchise and Regulatory 
Board to provide mass transportation services to the public. 
d) 
Certificate of Public Convenience - An authorization issued by the 
Mass Transit and Regulatory Board, as the case may be, for the operation of 
mass transportation services for which no franchise, either municipal or 
legislative, is required by law. 
e) 
Design, Build, Operate and Transfer - A contractual arrangement 
whereby the contractor designs and undertakes the construction, including 
financing, of a given mass transportation facility, and the operation and 
maintenance thereof until its total investment expended to the project, plus a 
reasonable rate of return on investment thereon is fully recovered, after which the 
contractor shall transfer the facility to the Authority. 
SEC. 4. 
Creation of the Mass Transit Authority. - There is hereby 
created a corporate body, to be known as the Mass Transit Authority, hereinafter 
referred to as the Authority. 
SEC. 
following functions: 
5. Functions of the Authority. - The Authority shall have the 
a) 
formulate and adopt a comprehensive development plan for the 
coordination of transportation services and facilities; 
b) 
implement or cause the implementation of the transportation plan, 
policies and programs according to a schedule of priorities consistent with the 
needs and available resources; 
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c) 
control 
and 
development, 
construction, 
operations 
and 
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maintenance of public transportation facilities, including parking stations, 
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terminals, road networks and conveyances such as buses, jeepneys, taxis and 
motor vehicles for freight, goods and cargoes; 
d) 
regulate the schedule, frequency, routing and pricing of public 
trans port at ion services. 
SEC. 6. Powers of the Authority. - The Authority shall have the following 
powers: 
a) 
b) 
to have continuous succession under its corporate name; 
to sue and be sued; 
c) 
d) 
e) 
to adopt, alter and use a corporate seal; 
to adopt, amend and/or repeal its bylaws; 
to acquire, lease or hold such real or personal property as it deems 
necessary or convenient in the transaction of its business and to lease, 
mortgage, sell, alienate or otherwise dispose of any such real or personal 
property held by it; 
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to enter into any obligation, assign or accept the assignment and 
rescind any agreement or contract necessary or incidental to the proper 
functioning of the Authority; 
g) 
to exercise the power of eminent domain in the name of the 
Republic of the Philippines and in the acquisition of real estate by excess 
condemnation or escheat proceedings, including appurtenant properties. The title 
thereto shall be registered in the name of the Government and thereupon all 
such properties shall be entrusted to the Authority as agent of the Government; 
h) 
to purchase, hold, alienate, mortgage, pledge or otherwise dispose 
of the shares of the capital stock of, or any bond, security or other evidence of 
indebtedness created by any other corporation or entity, local or foreign, and 
while the owner of said stocks, to exercise all the rights of ownership, including 
the right to vote thereon; 
i) 
to fix rates of transportation fares for such mass transport 
systemlcommon carriers covered by this Act; 
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j) 
to set priorities which shall be followed in the development of traffic 
and transportation facilities in accordance with the Authority’s plans, policies and 
programs; 
k) 
to prescribe, fix and regulate the route of mass transport 
operatorsl’common carriers; 
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to design, construct, maintain and operate, by itself or by delegation 
to, or through contractual arrangement, parking facilities above or below ground, 
including means of access, including the power to collect and retain fees from the 
operation or regulation of these facilities; 
m) 
to cooperate, coordinate and exchange such information, studies 
and reports with, and to seek the cooperation of other government agencies 
including government-owned or controlled corporation; 
n) 
to create such offices and divisions which are necessary for 
carrying out the functions and duties of the Authority and to prescribe the staffing 
patterns for such offices and divisions, subject to existing laws; and 
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to promulgate such rules and regulations as may be necessary to 
carry out the objectives of this Act. 
SEC. 7. Board of Directors. - All powers of the Authority shall be vested 
in and exercised by the Board of Directors, hereinafter referred to as the Board, 
which shall be composed of five (5) members, to be appointed by the President 
of the Philippines. The members of the Board shall serve for a term of three (3) 
years or until their successors shall have been appointed and qualified. 
Appointment to any vacancy shall only be for the unexpired term of the 
predecessor. 
No person shall be appointed as member of the Board unless he is a 
natural-born citizen of the Philippines, at least thirty-five (35) years of age and of 
established integrity. 
The Chairman shall be designated by the President from among the 
members of the Board. 
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SEC. 8. Management. - The management of the Authority shall be 
headed by an. Administrator, who shall be assisted by two (2) Deputy 
Administrators. 
The Administrator and his deputies must be natural-born citizens, at least 
thirty-five (35) years of age on the day of their appointment, of good moral 
character and with recognized executive ability and competence in the field of 
transportation, business administration, management, finance, or law. They shall 
be appointed by the President and shall serve as such for a term of three (3) 
years. 
SEC. 9. Powers and Duties of the Administrator. - The Administrator 
shall have the following powers and duties: 
a) 
to implement, enforce and apply the policies, programs, plans, 
guidelines, decisions, rules and regulations issued and adopted by the Board; 
b) 
to direct and supervise the operations and administration of the 
Authority; 
to determine, with the approval of the Board, the staffing pattern 
c) 
and the number of personnel of the Authority; 
d) 
to delegate such functions and duties to the Deputy Administrators 
for the efficient administration and management thereof; 
e) 
to represent the Authority in all transactions with other government 
offices, agencies and instrumentalities and with all persons and other entities, 
public or private, domestic or foreign; and 
f) 
to perform such other functions as the Board may assign or 
authorize. 
SEC. 10. Tax Exemptions. - The importation of equipment, machineries, 
spare parts, accessories and other materials, including supplies and services 
used directly in the operations of the mass transit, not obtainable locally on 
favorable terms, shall be exempted from all direct and indirect taxes, customs, 
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deem it necessary for the Authority to incur indebtedness or to issue bonds to 
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uties, fees, imposts, tariff duties, wharfage fees and other charges and 
the provisions of existing laws to the contrary notwithstanding. 
SEC. 1 I. Power to lssue Bonds. - Whenever the Board of Directors 
outstanding pursuant to this provision, including bonds issued, shall not exceed 
Five hundred million pesos (P500,000,000.00) at any time: and Provided, further, 
That foreign loans shall be negotiated in coordination with the proper authorities. 
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The loans, credits and indebtedness contracted under this Section and the 
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principal interest and other charges thereon shall be exempt from all direct and 
indirect taxes, fees, imports and other charges and restrictions. 
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SEC. 13. Capitalization. - The Authority shall have an authorized capital 
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stock of Five hundred million pesos (P500,00,000.00) which shall be fully 
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subscribed by the Republic of the Philippines and other government institutions, 
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corporations, instrumentalities and agencies whether national or local, within the 
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framework of their respective charters. 
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The authorized capital shall be used for the purpose of financing the 
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authority’s business transactions. 
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SEC. 
14. 
Auditor. - The Commission on Audit shall appoint a 
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representative who shall be the Auditor of the Authority and such personnel as 
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may be necessary to assist said representative in the performance of his duties. 
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SEC. 
15. 
Repealing Clause. - All laws, decrees, orders, rules and 
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regulations or parts thereof inconsistent with the provisions of this Act are hereby 
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SEC. 16. Separability Clause. - If any provision of this Act is declared 
repealed, amended or modified accordingly. 
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invalid, the provisions thereof not affected by such declaration shall remain in 
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force and effect. 
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SEC. 17. €ffectivity Clause. - This Act shall take effect after fifteen (15) 
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days following its publication in at least two (2) newspapers of general circulation. 
Approved, 
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