SEVENTEENTH CONGRESS OF THE REPUBLIC
^ciiaie
of li.r £ r:rilnr|*
OF THE PHILIPPINES
First Regular Session
P6 24
S E N A T E
S.B. No. 1440
Introduced by Senator Poe
AN ACT
CREATING THE PHILIPPINE AIRPORTS AUTHORITY, DEFINING ITS 
POWERS, FUNCTIONS AND RESPONSIBILITIES, PROVIDING FUNDS 
THEREFOR, AND FOR OTHER PURPOSES
Explanatory Note
The Philippines has 85 airports nationwide, four (4) of which arc regular 
international airports and five (5) are alternate international airports. These airports 
are classified under the new system of classification instituted by the Civil Aviation 
Authority of the Philippines (CAAP) into international airports, principal airports, and 
community airports. Only airports owned by the national government are classified by 
the CAAP; the vast majority of minor aerodromes around the country are not owned 
by the national government and remain unclassified under the new scheme. Under the 
scheme, all domestic airports in the country are under the operational and supervisory 
control of CAAP pursuant to Republic Act No. 9497, while the international airports 
are governed by specific authorities and/or corporation created by law for the purpose.
Among others, the Manila International Airport Authority (MIAA) was 
originally created pursuant to Executive Order No. 778, as amended, and exercises 
jurisdiction over the Ninoy Aquino International Airport. The Clark International 
Airport is operated and managed by the Clark International Airport Corporation 
created by virtue of Executive Order 193. On the other hand, the Mactan-Cebu
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International Airport is under the operational and supervisory control of the Mactan- 
Cebu International Airport Authority in accordance with Republic Act No. 6958.
Currently, there is a need to upgrade existing international and domestic 
airports, and air navigation facilities in the country to comply with international 
standards of airport accommodation and services, and to meet the present and future 
air traffic and aviation services demands in the country. Studies have indicated that 
the objectives of providing high standards of accommodation and service within the 
context of a financially viable operation will best be achieved by a separate and 
autonomous regulatory body.
This bill seeks to ensure an integrated manner of operating international and 
domestic airport terminals in the country, and to avoid conflicting policies and 
programs on airport maintenance, operation and development, as well as flight 
operations, through the creation of a Philippine Airports Authority to handle the 
operations of all international and domestic airports in the country.
In view of the foregoing, the early passage of this bill is earnestly sought.
ACE POE


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SEVENTEENTH C ONGRESS OF THE REPUBLIC 
OF THE PHIMPPINES
First Regular Session
S E N A T E
S.B. No. Id 40
*17 HAY-9
REC ti'. £ j  jY ; .
X
P6--24
/isV
Introduced by Senator Poe
AN ACT
CREA TING THE PHILIPPINE AIRPORTS AUTHORI TY, DEFINING I TS 
POWERS, FUNCTIONS AND RESPONSIBILITIES, PROVIDING FUNDS 
THEREFOR, AND FOR OTHER PURPOSES
Re it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled.
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SECTION 1. Title. - This Act shall be known as the "Philippine Airports
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Authority Act of 2017”.
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SECTION 2, Definition of Terms. - For purposes of this Act, the following
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shall mean:
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a) ‘‘Authority” - shall refer to the Philippine Airports Authority.
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b) “Aircraft” - any machine that can derive support in the atmosphere from 
the reactions of the air other than the reactions of the air against the earth’s 
surface. The term, when used in this Act, shall refer to a civil aircraft only 
and will not include State or public aircraft.
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c) ‘‘Airport” - shall refer to a defined area on land or water, including any 
building, installation, facilities and equipment, intended to be used either 
wholly or in part for the arrival, departure and surface movement of an 
aircraft. The term, when used in this Act, shall include all domestic and 
international airports in the country.


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d) “Board” - shall refer to the Board of Directors of the Authority.
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SECTION 3. Creation of the Philippine Airports Authority. -  There is hereby
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established a body corporate to be known as the Philippine Airports Authority,
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hereinafter referred to as the Authority, which shall be attached to the Department of
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Transportation (DOTr) and shall be headed by a General Manager as Chief Executive
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Officer of the Authority. The Authority may establish such offices, branches, agencies
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or subsidiaries as it may deem proper and necessary to administer and operate all
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domestic and international aiiport terminals in the country: Provided, That the
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establishment of a subsidiary shall have the prior approval of the President of the
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Philippines.
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SECTION 4. 
Purposes and Objectives. - The Authority shall have the
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following purposes and objectives:
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a) To help encourage and promote domestic and international air traffic in the 
Philippines as a means of accelerating the development of aviation, as a 
means of transportation in the country, as well as making the Philippines a 
center of international trade and tourism;
b) To formulate and adopt, for application in all domestic and international 
airport terminals in the country, internationally acceptable standards of 
airport accommodation and service; and
c) To upgrade and provide safe, efficient, and reliable airport facilities for 
domestic and international air travel.
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SECTION 5. Functions, Powers and Duties of the Authority. - The Authority
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shall have the following functions, powers and duties:
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a) To formulate, in coordination with the Civil Aviation Authority of the 
Philippines (CAAP), independent airport authorities and other appropriate 
government agencies, a comprehensive and integrated policy and program 
for all domestic and international airport terminals in the country, and to 
implement, review and update such policy and program periodically;
b) To control, supervise, construct, maintain, operate and provide such


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facilities and services as shall be necessary for the safe and efficient 
functioning of all domestic and international airport terminals in the 
country;
c) To promulgate rules and regulations governing the planning, development, 
maintenance, operation and improvement of domestic and international 
airport terminals in the country, and to control and/or supervise, as may be 
necessary, the construction of any structure or the rendition of any service 
within all domestic and international airport terminals;
d) To sue and be sued in its corporate name;
e) To adopt and use a corporate seal;
f) To succeed by its corporate name;
g) To adopt its by-laws, and to amend or repeal the same from time to time;
h) To execute or enter into contracts of any kind or nature;
i) To acquire, purchase, own, administer, lease, mortgage, sell or otherwise 
dispose of any land, building, airport facility, or property of whatever kind 
and nature, whether movable or immovable, or any interest therein;
j) To exercise the power of eminent domain in the pursuit of its purposes and 
objectives;
k) To levy, and collect dues, charges, fees or assessments for the use of the 
airport premises, works, appliances, facilities or concessions or for any 
service provided by the Authority, subject to the approval of the Secretary 
of Transportation in consultation with the Secretary of Finance;
l) To invest its idle funds, as it may deem proper, in government 
securities and other evidences of indebtedness of the government;
m) To provide services, whether on its own or otherwise, within the airports 
and the approaches thereof, which shall include but not be limited to, the 
following:
1) Aircraft movement and allocation of parking areas of aircraft on the 
ground,
2) Loading or unloading of aircraft;
3) Passenger handling and other services directed towards the care, 
convenience and security of passengers, visitors and other airport users; 
and
4) Sorting, weighing, measuring, warehousing or handling of baggage


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and goods.
n) To prescribe and revise, from time to time as necessary, minimum safety 
standards for the operation of airport facilities in the Philippines;
o) To perform such other acts and transact such other business, directly or 
indirectly as may be necessary, incidental or conducive to the attainment of 
the purposes and objectives of the Authority, including the adoption of 
necessary measures to remedy congestion in the airports; and
p) To exercise all the powers of a corporation under the Corporation Law, 
insofar as these powers are not inconsistent with the provisions of this Act.
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SECTION 6. Police Authority. - The Authority shall have the power to 
exercise such px)lice authority, as may be necessary within its premises, to carry out 
its functions and attain its purposes and objectives. The grant of such powers shall be 
without prejudice to the exercise of functions within the same premises by other 
concerned government agencies as provided for by law: Provided, That the Authority 
may request the assistance of law enforcement agencies, including request for 
deputization as may be required. Such police authority shall be exercised in 
connection with the following, among others:
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a) Maintenance of security to passengers, cargoes, aircraft, airport equipment, 
structures, facilities, personnel, funds and documents;
b) Regulating the entry to, exit from and movement within the airports;
c) Maintenance of peace and order, within the premises of the airports in 
coordination with local police authorities and other authorized peace­
keeping entities within the airports;
d) Regulation and supervision of private security agencies operating within 
the airports; and
e) Enforcement of rules and regulations promulgated by the Authority 
pursuant to law.
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SECTION 7. Airport Operation Certification. - 
Any person desiring to 
operate a private airport or air navigation facilities may file with the Authority an 
application for an operating certificate. If the Authority finds, after investigation, that 
such person is properly and adequately equipped and able to conduct a safe operation


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in accordance with the requirements of this Act and the rules and regulations, and 
standards prescribed therein, the Authority shall issue an airport operating certificate 
to such person. Each airport operating certificate shall prescribe such terms, 
conditions and limitations as are reasonably necessary to assure safety in air transport. 
Unless the Authority determines that it would be contrary to public interest, such 
terms, conditions and limitations, shall include, but not limited to, terms and 
conditions relating to:
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a) The ofteration and maintenance of adequate safety equipment, including 
firefighting and rescue equipment capable of rapid access to any portion of 
the airport used for landing, take off, or surface maneuvering of aircraft; and
b) The condition and maintenance of primary and secondary runways.
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For this purpose, the Authority shall inspect, classify, and rate any air navigation
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facilities and airports available for the aircraft as to its suitability for such use.
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SECTION 8. Board of Directors. - The corporate powers of the Authority
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shall be exercised by and vested in a Board of Directors, hereinafter referred to as the
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Board. It shall be composed of eleven (11) members, as follows:
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Secretary of the DOTr or his representative - Chairperson;
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General Manager of the Authority - Vice-Chairperson;
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Representative from the Office of the President;
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Representative from the Department of Finance;
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Representative from the Department of Tourism;
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Representative from the Department of Justice;
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Representative from the CAAP; and,
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Four (4) representatives from the private sector to be appointed by the 
President of the Philippines for a term of three (3) years renewable for another 
term.
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The Board shall meet at least once a month and as often as the exigencies of 
the service demand. The presence of at least five (5) members shall constitute a 
quorum, and the vote of a majority of the members present, there being a quorum.


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shall be necessary for the adoption of any rule, regulation, resolution, decision or any
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other act of the Board.
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The members of the Board shall receive per diems, for every meeting actually 
attended: Provided, that such per diem shall conform to existing guidelines of the 
Commission on Audit. Members of the Board shall be reimbursed by the Authority 
for actual expenses, including travelling and subsistence expenses, incurred by them 
in the performance of their duties.
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No member of the Board shall have financial or pecuniary interest, directly or 
indirectly, in any business contract or transaction entered into by the Authority or in 
any privilege granted by it. Neither shall a member have any interest, financial or 
otherwise, in any undertaking or business with an inherent conflict of interest with the 
Authority.
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SECTION 9. Functions, Powers, and Duties of the Board. - The Board shall
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have the following functions, powers and duties;
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a) To define and approve the programs, plans, policies, procedures and 
guidelines of the Authority for the development and operation of the 
airports within the context of the overall Government objectives, and to 
control the management, operation and administration of the Authority;
b) To recommend to the President of the Philippines, for appointment, a 
General Manager of the Authority who shall be the Chief Executive Officer 
of the Authority; and
c) To approve the Authority's organizational and administrative structure, 
staffing pattern, operating and capital expenditures, and financial budgets, 
prepared in accordance with the corporate plan of the Authority, upon 
recommendation of the General Manager.
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SECTION 10. Development of New Airports. - The Board shall be 
responsible for the planning, development, construction, operation, maintenance or 
the expansion of airports. In planning and developing new airports, the Board shall 
consider:


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a) The suitability of a proposed site in terms of terrain and proximity to 
population centers;
b) The projected size of the market to be served by a proposed airpx)il;
c) The ability of a proposed airpx)rt to generate sufficient revenue to cover 
costs of operation and maintenance;
d) The availability of funding from both local and foreign sources for the 
construction of a new airport or expansion of an existing one;
e) The proximity of other airports to a proposed new airport and the capability 
of such other airport to handle traffic projected to be handled by the new 
proposed airport;
0 The government’s public service obligations such as the government’s duty 
to ensure the availability of air transport infrastructure for remote areas far 
from major population centers and that arc not otherwise easily accessible 
by transportation by land or sea;
g) International 
Civil 
Aviation 
Organization 
best 
practices 
and 
recommendations concerning the development of airports; and
h) Such other considerations as the Board, in the exercise of its reasonable 
discretion, may consider relevant or important.
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SKCTION 11. Inunctions, Powers and Duties of the General Manager. - The
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General Manager shall be directly responsible to the Board, and shall have the
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following functions, powers and duties;
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a) To direct and supervise the management, operation and administration of 
the Authority, and its integral units including its buildings, runways, 
facilities and equipment, so as to provide international standards of service 
to airport users, and to ensure its financial stability in accordance with the 
programs, plans, policies, procedures and guidelines of the Board;
b) To provide general supervision and overall coordination of all government 
agencies operating in the airports with respect to the allocation and use of 
building space and airport premises;
c) To undertake researches, studies, investigations, and other activities related 
to the present operations and future development requirements of the 
airports, on his own initiative or upon instructions of the Board, and to


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submit comprehensive reports, and appropriate recommendations to the 
Board for its information and action;
d) To appoint, transfer, suspend, remove or otherwise discipline any 
subordinate officer or employee of the Authority, subject to the approval of 
the Board and to engage, either on contractual basis or other suitable 
arrangements, the services of highly qualified professionals, experts, 
technical advisers or consulting firms and to determine their compensation 
or fees including other tenns and conditions of employment as may be 
authorized 
by 
the 
Board; 
To 
enter 
into 
a 
memorandum 
of 
agreement/understanding, contracts or such other arrangements as may be 
feasible with such government agencies or private entities operating or 
providing services to the Authority to ensure proper coordination and 
integration of all activities in the Authority, subject to the approval of the 
Board or such laws, rules and regulations as are applicable in the exercise 
of such authority;
e) To establish and maintain a system, in coordination with the appropriate 
government offices and agencies, for the regular and prompt dissemination 
of financial, statistical and other relevant data within the Authority and to 
the Board;
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Within the limits of the authority delegated to him by the Board, to execute 
contracts, incur obligations, acquire and dispose of assets, and deliver 
documents, on behalf of the Authority;
g) To implement and enforce decisions, orders, rules and regulations issued, 
prescribed or adopted by the Board; and
h) To perform such other duties as the Board may delegate or assign, and such 
acts as may be necessary and proper to implement this Act.
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SECTION 12. Capital. - The Authority shall have a capital of Fifty Billion 
Pesos (Php 50,000,000,000.00) which shall be contributed by the National 
Government and to consist of:
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a) The value of fixed assets (including airport facilities, runways and 
equipment) and such other properties, movable and immovable, which may 
be contributed by the National Government or transferred by it from any of


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its agencies, the valuation of which shall be determined jointly with the 
Department of Budget and Management (DBM) and the Commission on 
Audit (COA) on the date of such contribution or transfer after making due 
allowances for depreciation and other deductions taking into account the 
loans and other liabilities of the Authority at the time of the takeover of the 
assets and other properties;
b) The unexpended balances of appropriations in the current General 
Appropriations Act, 
and other laws in force upon approval hereof, 
pertaining to, held or used by, or available to the entities abolished and/ or 
whose powers, duties and responsibilities have been transferred to the 
Authority under this Act, including concerned government agencies;
c) Any surplus income that may be derived from or shall accrue to the 
Authority upon its organization and its assumption of the assets and 
liabilities of the entities abolished and/ or whose powers, duties and 
responsibilities have been transferred to the Authority under this Act, 
including concerned government agencies; and
d) Such amount as may be appropriated from time to time from the funds of 
the National Treasury not otherwise appropriated including any outlay from 
the infrastructure program of the National Government and as may be 
provided in the annual General Appropriations Act.
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SECTION 13. Contribution to the General Fund for the Maintenance and 
Operation of Airports. - Within thirty (30) days after the close of each quarter, twenty 
per centum (20%) of the gross operating income, excluding payments for utilities of 
tenants and concessionaires and terminal fee, collections, shall be remitted to the 
General Fund in’ the National Treasury to be used for the maintenance and operation 
of international and domestic airports in the country. Adjustments in the amount paid 
by the Authority to the National Treasury under this Section shall be made at the end 
of each year based on the audited financial statements of the Authority.
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SECTION 14. Auditor. - The Chairman of the COA shall be the ex-officio 
Auditor of the Authority. For this purprose, he may appoint a representative who shall 
be the auditor of the Authority, together with the necessary personnel to assist said 
representative in the performance of his duties. The salary of the auditor and the


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number and salaries of said personnel shall be determined by the Chairman of the 
Commission on Audit subject to the rules and regulations of the Commission on 
Audit. Said salaries and all other expenses of maintaining the Auditor's Office shall be 
paid by the Authority.
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The Auditor shall, as soon as practicable, but not later than three (3) months 
after the accounts have been submitted for audit, send an annual report to the Board. 
The Auditor may also submit such periodic or special reports as the Board may deem 
necessary.
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SECTION 15. Legale Counsel. - The Government Corporate Counsel and/or 
the Solicitor General shall be the Legal Counsel of the Authority: Provided, That the 
Authority may establish its own legal department to handle the day- to-day legal 
matters affecting the affairs of the Authority.
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SEC TION 16. Annual Report. - The Board shall submit to the President of 
the Philippines through the DOTr, together with the audit report on the relevant 
accounts an annual report generally dealing with the activities and operations of the 
Authority.
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SECTION 17. 
Applicability of Civil Service Laws. - The Authority and its 
officials and employees shall be subject to the Civil Service Law and its rules and 
regulations.
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SECTION 18. 
Borrowing Power. - The Authority may, after consultation 
with the Secretary of Finance and with the approval of the President of the 
Philippines, as recommended by the Secretary of DOTr, raise funds, either from local 
or international sources, by way of loans, credits or securities, and other borrowing 
instruments, with the power to create pledges, mortgages and other voluntary liens or 
encumbrances on any of its assets or properties.
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All loans contracted by the Authority under this Section, together with all 
interests and other sums payable in respect thereof, shall constitute a charge upon all 
the revenues and assets of the Authority and shall rank equally with one another, but
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shall have priority over any other claim or charge on the revenue and assets of the
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Authority; Provided, That this provision shall not be construed as a prohibition or
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restriction on the power of the Authority to create pledges, mortgages and other
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voluntary liens or encumbrances on any asset or property of the Authority.
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Except as expressly authorized by the President of the Philippines, the total
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outstanding indebtedness of the Authority in the principal amount, in local and
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foreign currency, shall not, at any given time, exceed the net worth of the Authority.
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The President or his duly authorized representative, after consultation with the 
Secretary of Finance, may guarantee, in the name and on behalf of the Republic of the 
Philippines, the payment of the loans or other indebtedness of the Authority up to the 
amount herein authorized.
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SECTION 19. Increase or Decrease of Rates. - The Authority may increase 
or decrease the rates of the dues, charges, fees or assessments collectible by the 
Authority to protect the interest of the Government and provide a satisfactory return 
on the Authority's assets based on the principle of cost recovery at an aggregate level. 
The Authority may adjust the schedule of such rates so as to reflect the cost of 
facilities or services provided, or rendered. The Authority may pcriodieally review all 
dues, charges, fees, or assessments collectible by the Authority, and shall make such 
adjustments to the schedule of rates as shall adequately reflect any increase in price 
levels and (in the case of concession rentals) of volume of traffic through the airports, 
subject to the provisions of Batas Pambansa Big. 325, whenever practicable.
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SECTION 20. Remedies for Non-Payment. - If the owner or agent of any 
aircraft refuses or neglects to pay on demand any rate or charges made in pursuance 
of Section 19 hereof, the Authority may, after complying with the required legal 
formalities provided by law, shall have the power to impose lien on such aircraft 
equipment or furniture belonging to the owner or agent of said aircraft, until the 
amounts due have been paid.
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SECTION 21. Fines and Penalties. - The Authority shall have the power to
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exact reasonable administrative fines in such specific amounts and for such specific
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violations arising out of the use of the airports, as shall be prescribed in rules and
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regulations which the Authority is hereby authorized to issue for the purpose, which
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amount of fine shall not be less than One Thousand Pesos (Php 1,000.00) nor more
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than Twenty Thousand Pesos (Php20,000.00), and shall be subject to review and
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increase every five (5) years.
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SECTION 22. CompetHive Tender. - The General Manager shall, as far as 
practicable, grant j^ermits or concessions to trade or to engage in business within the 
areas controlled by the Authority to the highest bidder after a competitive public 
bidding; Provided, That the bidding requirements may be waived in the case of banks, 
branches of post oflice. National Telecommunications Commission, other government 
agencies in airline operations or where the fees, rates or assessments to be charged 
have been fixed by the Board.
The General Manager shall require such permittees or concessionaires to
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provide goods or services acceptable under international standards and at such prices
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similar to goods or services in Metropolitan Manila or airports in other countries:
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Provided, That such final awards of permits or concessions to successful bidders shall
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be subject to the approval of the Board.
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SECTION 23. Tax Exemptions. - The Authority shall be exempt from realty 
taxes imposed by the National Government or any of its political subdivisions, 
agencies and instrumentalities; Provided, That no tax exemption herein granted shall 
extend to any subsidiary which may be organized by the Authority.
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SECTION 24. Transfer of Power and Assets. - All powers, duties and rights 
vested by law and exercised by the CAAP relating to the control, supervision, 
construction, maintenance, operation, provision of services and facilities and the 
efficient functioning of all domestic and international airports in the country 
pursuant to Republic Act No. 9497, are hereby transferred to the Authority. All 
assets, real and personal properties, contracts, records and documents, funds and 
revenues owned by or vested in the different offices of CAAP in relation to the 
powers, duties and rights herein transferred shall also be transferred to the 
Authority.
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SECl'ION 25. Projects in Progress. - All ongoing projects relating to the 
construction of airport facilities shall be continued by the agency or agencies involved 
until completion. Thereafter, such projects shall be transferred to the Authority, in 
accordance with agreement among agencies concerned. Any disagreement, relating to 
such transfer, shall be submitted to the President of the Philippines for final decision.
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SECTION 26. Transfer of Liabilities and Debts. - Upon the transfer to and 
acceptance by the Authority of the existing physical facilities, intangible assets and 
completed projects referred to in the preceding sections, all debts, liabilities, and 
obligations of the of the entities concerned and other government agencies in respect 
of such physical facilities, tangible assets and completed projects within the 
airports, shall likewise be assumed by the Authority.
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SECTION 27. Prohibited Acts and Penalties. - The General Manager, after
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due notice and hearing, is hereby authorized to impose the following fines and
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penalties for the commission of any of the acts hereunder prohibited:
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a) Any person who destroys or seriously damages the facilities of an airport or 
disrupts the services of an airport shall be subjected to imprisonment of one 
(1) year to three (3) years and/or a fine of not less than One hundred 
thousand pesos (Php 100,000.00) but not more than Five hundred thousand 
pesos (Php 500,000.00), or both, at the discretion of the court;
b) An imprisonment of not less than one (1) year but not more than three (3) 
years and / or a fine of not less than One hundred thousand pesos (Php
100.000. 00) but not more than Five hundred thousand pesos (Php
500.000. 00), at the discretion of the court, shall be imposed upon any 
person who shall interfere with air navigation, including but not limited to 
such acts as:
1) Exhibiting within the Philippines any light or signal in such manner or 
place that it is likely to be mistaken for a true light or signal in 
connection with an airport or other navigational facility; or
2) Knowingly removes, extinguishes, or interferes with the operation of 
any true light or signal.
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SEC riON 28. Appropriations. - To provide for any extraordinary expenses 
of the Authority upon its organization, the unavailed portion of the excess of actual 
operating income over the estimated expenses of the entities abolished and/or whose 
powers, duties and responsibilities have been transferred to the Authority under this 
Act, if any, at the time of the passage of this Act is hereby appropriated for purposes 
that the Board may approve. This shall be considered as part of the capital under 
Section 12 hereof
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SECTION 29. Repealing Clause. - A\l laws, executive orders, letters of 
instructions, rules and regulations, or provisions thereof, which are inconsistent with 
the provisions of this Act are hereby repealed, amended or modified accordingly.
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SECTION 30. Separability Clause. - The provisions of this Act are hereby 
declared separable. If any portion thereof shall be held invalid unconstitutional, such 
invalidity or unconstitutionality shall not affect the other provisions which shall 
remain in full force and effect.
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SECTION 31. Effectivity Clause - This Act shall take effect within fifteen 
(15) after its complete publication in the Official Gazette or in at least two (2) 
newspapers of general circulation.
Approved,
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