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Republic of the Philippines 3 RECEIVED <\
HOUSE OF REPRESENTATIVES

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Batasan Hills, Quezon City ime

2, BY.
EIGHTEENTH CONGRESS

First Regular Session

2101
HOUSE BILL No.

Introduced by
ACT Teachers Party-List Rep. FRANCE L. CASTRO,
BAYAN MUNA Party-List Rep. CARLOS ISAGANI T. ZARATE,
Rep. FERDINAND GAITE and Rep. EUFEMIA C. CULLAMAT,
GABRIELA Women's Party Rep. ARLENE D. BROSAS,
and KABATAAN Party-List Rep. SARAH JANE |. ELAGO

AN ACT
AMENDING SECTION 8 OF REPUBLIC ACT 6426, OTHERWISE KNOWN AS THE
“FOREIGN CURRENCY DEPOSIT ACT OF THE PHILIPPINES”

EXPLANATORY NOTE

In 1977, Presidential Decree 1246 conferred an “absolute cloak of
confidentiality” over foreign currency deposits and exempted them from
“attachment, garnishment, or any other order or process of any court, legislative
body, government agency or any administrative body” to “better encourage the
inflow of foreign currency deposits” into Philippine banks that could channel these
funds into loans and investments, and thereby contribute to the country’s economic
development.

Subsequent developments have rendered obsolete the special protections
provided by law to foreign currency deposits. While there may have been a relative
scarcity of foreign currency in the domestic banking and financial system i
1970s, this is clearly no longer the case today. Remittances by Overseas
Workers, totaling over US$ 9.739 billion from January to April 2019—an increase of
4.1% from the same period last year—on top of traditional sources of foreign
currency, ensure that that country’s foreign currency reserves are at an all-time high.



Furthermore, recent history has shown how the absolute and unqualified
secrecy of foreign currency deposits, and their exemption from government orders
and processes, may be exploited to cloak financial transactions by individuals and
entities involved in illegal activities. For instance, government officials, including
those conferred with immunity from suit during their incumbency and removable
only through impeachment, may make use of foreign currency deposits to amass ill-
gotten wealth.

This bill proposes amendments to Republic Act 6426, or the Foreign Currency
Deposit Act of the Philippines, that, while maintaining the secrecy of foreign currency
deposits, allows their examination in certain exceptional cases, such as
impeachment, or upon the order of a competent court. In addition, it proposes that
their exemption from governmental processes be removed. If this bill is enacted into
law, foreign currency deposits will, in these respects, enjoy the same level of
protection as deposits in the national currency.

For These reasons, approval of this bill is earnestly sought.

Teach¢¢s Party-List

Rep. CARLOS 2s T. ZARATE Rep. FERDINAND GAITE

BAYAN MUNA Party-List BAYAN MUNA Party-List
Rep. Tn C. CULLAMAT Rép. ARLE(VE D. BROSAS
BAYAN MUNA Party-List GABRIELA Women’s Party

Rep. SARAH JANE I. ELAGO
KABATAAN Party-List


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Batasan Hills, Quezon City

EIGHTEENTH CONGRESS
First Regular Session

2101
HOUSE BILL No.

Introduced by
ACT Teachers Party-List Rep. FRANCE L. CASTRO,
BAYAN MUNA Party-List Rep. CARLOS ISAGANI T. ZARATE,
Rep. FERDINAND GAITE and Rep. EUFEMIA C. CULLAMAT,
GABRIELA Women’s Party Rep. ARLENE D. BROSAS,
and KABATAAN Party-List Rep. SARAH JANE |. ELAGO

AN ACT
AMENDING SECTION 8 OF REPUBLIC ACT 6426, OTHERWISE KNOWN AS THE
“FOREIGN CURRENCY DEPOSIT ACT OF THE PHILIPPINES”

SECTION 1. Section 8 of Republic Act 6426 or the “Foreign Currency Deposit Act of
the Philippines”), as amended by Presidential Decree No. 1035, and further amended
by Presidential Decree No. 1246, is hereby amended as follows:

Section 8. Secrecy of foreign currency deposits. — All foreign currency deposits
authorized under this Act, as amended by PD No. 1035, as well as foreign
currency deposits authorized under PD No. 1034, are hereby declared as and
considered of an absolutely confidential nature [and, except upon the written
permission of the depositor, in no instance shall foreign currency deposits be
examined, inquired or looked into by any person, government official, bureau
or office whether judicial or administrative or legislative, or any other entity
whether public or private,] IN NO INSTANCE SHALL FOREIGN CURRENCY
DEPOSITS BE EXAMINED, INQUIRED OR LOOKED INTO BY ANY PERSON,
GOVERNMENT OFFICIAL, BUREAU OR OFFICE WHETHER JUDICIAL OR


ADMINISTRATIVE OR LEGISLATIVE, OR ANY OTHER ENTITY WHETHER PUBLIC
OR PRIVATE EXCEPT UPON THE WRITTEN PERMISSION OF THE DEPOSITOR,
OR IN CASES OF IMPEACHMENT, OR UPON ORDER OF A COMPETENT COURT
IN CASES OF BRIBERY OR DERELICTION OF DUTY OF PUBLIC OFFICIALS, OR IN
CASES WHERE THE MONEY DEPOSITED OR INVESTED IS THE SUBJECT
MATTER OF THE LITIGATION. [Provided, however, That said foreign currency
deposits shall be exempt from attachment, garnishment, or any other order or
process of any court, legislative body, government agency or any
administrative body whatsoever.]

SECTION 2. Repealing Clause. All laws, decrees, resolutions, orders, or ordinances
or parts thereof inconsistent with this Act are hereby repealed, amended or modified

accordingly.

SECTION 3. This Act shall take effect fifteen (15) days after its publication in the
Official Gazette or one (1) newspaper of general circulation.

Approved,