Republic of the Philippines
HOUSE OF REPRESENTATIVES,
Quezon City, Metro Manila

TWENTIETH CONGRESS
First Regular Session

HOUSE BILL NO. 507

Introduced by Representative Jaime R. Fresnedi

EXPLANATORY NOTE

This bill seeks to promote transparency and accountability in all transactions
involving higher education institutions (HEIs) in the Philippines. As the country intensifies
its efforts to provide quality tertiary education, with the Department of Budget and
Management (DBM) allocating ? 105.6 billion for state universities and colleges in the 2024
National Expenditure Program (NEP)', there is a growing need to ensure that foreign
engagements do not compromise academic freedom, institutional autonomy, or national
security.

The increasing participation rate in tertiary education, which reached 51.38% as of
July 20242, the second highest in the ASEAN region after Singapore, underscores the
importance of safeguarding the integrity of our educational institutions. While foreign
collaborations can offer valuable resources and opportunities, they also pose potential risks
if not properly regulated. The lack of a comprehensive legal framework to monitor and
disclose foreign gifts, grants, donations, and contracts leaves HEls vulnerable to undue
influence and conflicts of interest.

This proposed legislation aims to bridge this policy gap by mandating the disclosure
of significant foreign transactions to the Commission on Higher Education (CHED). It also
seeks to enhance transparency by establishing clear guidelines and thresholds for reporting
without hindering beneficial international partnerships. Moreover, the bill empowers
CHED to monitor and assess these engagements, ensuring they align with national interests
and educational standards.

In light of the substantial investments in the education sector and the critical role of
HEls in national development, it is imperative to enact measures that protect their
autonomy and uphold the public trust. This proposed measure represents a proactive step

+ 2024 NEP allocates P105.68 for SUCS (https //mirror pia.gov.ph/press rele. .@s/2023/08/13/2024 ne,
allocates -p1056b-for-state-universities-colleges)
2 Fill P4.1-8 funding gap for free higher education (https //www.pna.gov ph icles/12111°0)



towards reinforcing the integrity of our higher education system and ensuring that foreign
collaborations contribute positively to the country's academic and developmental goals.

In view of the foregoing, the immediate passage of this bill is eamestly sought.

JAIME NEDI
Répresentative
Lone District, Muntinlupa City


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

TWENTIETH CONGRESS
First Regular Session

HOUSE BILL NO. 307

Introduced by Representative Jaime R. Fresnedi

AN ACT
REQUIRING HIGHER EDUCATION INSTITUTIONS TO DISCLOSE FOREIGN
GIFTS AND CONTRACTS, ESTABLISHING A MONITORING MECHANISM,
PROVIDING PENALTIES FOR NON-COMPLIANCE, APPROPRIATING FUNDS
THEREFOR, AND FOR OTHER PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:

Section 1. Short Title. - This Act shall be known as the "Transparency in Foreign
Transactions for Higher Education Institutions Act."

SEC. 2. Declaration of Policy. — It is hereby declared the policy of the State to promote
transparency and accountability in all transactions involving higher education institutions.
Recognizing that higher education institutions increasingly engage with foreign governments,
entities, and individuals, the State reaffirms its commitment to safeguarding the autonomy of
higher education institutions, protecting academic freedom, and preserving the integrity of the
country's educational system.

The State likewise affirms that academic institutions must remain spaces of free thought,
innovation, and critical inquiry, safeguarded from undue foreign influence or intervention.
Towards this end, the State shall ensure that all foreign gifts, grants, donations, endowments,
contracts, and other transactions entered into by higher education institutions are conducted
with full disclosure, are free from any undue influence, and do not compromise the sovereignty,
national security, and national interests of the Philippines. The State shall also establish
appropriate mechanisms to monitor and regulate such engagements in a manner that respects
institutional independence while upholding transparency and accountability.

SEC 3. Definition of Terms. — For purposes of this Act, the following terms shall mean:
a) Higher Education Institutions (HEIs) refer to any public or private institution duly

recognized by the Commission on Higher Education (CHED) that offers post-secondary degree
programs.


b) Foreign Source refers to foreign governments or any of its agencies, a legal entity,
created under the laws of a foreign country, a person who is not a citizen of the Philippines, or
an organization that is substantially controlled or financed by any of the foregoing.

c) Foreign Gifts or Contracts refer to any gift, grant, endowment, donation, contract, or
other arrangement involving the transfer of property, money, service, or any item of value from
a foreign source, whether made directly or indirectly, for the benefit of a higher education
institution, including its subsidiaries, research centers, or affiliated foundations

4) Threshold Amount refers to an aggregate value of at least Ten Million Pesos (Php
10,000,000.00) within a calendar year from a single foreign source.

SEC. 4. Mandatory Disclosure of Foreign Gifis and Contracts. - Every HEI that receives
foreign gifts or enters into foreign contracts meeting or exceeding the Threshold Amount in a
calendar year shall disclose to the Commission on Higher Education (CHED) the following:

a) Name and address of the foreign source;

b) Amount, nature, and terms of the foreign gift or contract;

c) Purpose for which the gift or contract was intended or used;

d) Conditions or restrictions attached, if any; and

e) Other relevant information as may be required by CHED.

SEC. 5. Timing and Manner of Disclosure. - The HEI shall submit the disclosure to
CHED within thirty (0) calendar days from the execution of the foreign contract or receipt of
the foreign gift. CHED shall prescribe the format of disclosure, which may include digital
filing.

SEC. 6. Public Access to Information. ~ All disclosures filed under this Act shall be
considered public documents and made available for inspection on the official website of
CHED, subject to existing laws on confidentiality and data privacy.

SEC. 7. Monitoring and Oversight. - CHED shall establish a monitoring mechanism to:

a) Review the submitted disclosures;

») Identify pattems or risks that may affect academic freedom, institutional autonomy;
or

c) Recommend appropriate actions or interventions to ensure compliance.

CHED may issue regulations to operationalize the provisions of this Act.


SEC. 8. Prohibited Transactions. — No HEI shall accept foreign gifts or enter into
contracts that:

a) Compromise its academic independence;

b) Require adoption of foreign political or ideological positions as a condition;

©) Violate national security laws or policies of the Republic of the Philippines.

SEC. 9. Penalties. - Any HEI that knowingly fails to disclose foreign gifts or contracts
as required under this Act shall be subject to:

a) Administrative penalties, including suspension of government assistance or
accreditation, after due notice and hearing by CHED; and

b) Referral to appropriate authorities for possible violations under Republic Act (R.A.)
No. 3019 or the “Anti-Grafi and Corrupt Practices Act”, if warranted.

CHED may recommend the imposition of appropriate sanctions under applicable
corporate governance and educational laws for private HEIs,

SEC. 10. Appropriations. ~ The amount necessary for the initial implementation of this
‘Act shall be charged against the current appropriations of CHED. Thereafter, such sums as may
be necessary for the continued implementation shall be included in the annual General
Appropriations Act.

SEC. 11. Implementing Rules and Regulations. - The CHED, in consultation with the
Department of Justice (DOJ), National Security Council (NSC), and other relevant stakeholders
shall jointly promulgate the implementing rules and regulations (IRR) to implement the
provisions of this Act and issue the same within sixty (60) days from its effectivity.

The IRR issued pursuant to this section shall take effect thirty (30) days after its
publication in a newspaper of general circulation.

SEC. 12. Separability Clause. — If any portion or provision of this Act is subsequently
declared invalid or unconstitutional, other provisions hereof which are not affected thereby
shall remain in full force and effect.

SEC. 13. Repealing Clause. — All laws, decrees, ordinances, administrative order, rules
and regulations, or any part thereof, which are inconsistent with this Act are repealed or
amended accordingly.

SEC. 14. Effectivity. — This Act shall take effect fifteen (15) days after its publication in
the Official Gazette and at least two (2) newspapers of national circulation.

Approved,