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

SIXTEENTH CONGRESS
First Regular Session

House Bill No.

Introduced by
ACT TEACHERS Party-List Representative Antonio L. Tinio

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 these 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 in the 1970s, this is clearly no longer
the case today. Remittances by Overseas Filipino Workers, totaling over USS 18,3 billion in
the first 11 months of 2011, on top of traditional sources of foreign currency, ensure that
the country's foreign exchange reserves are at an all-time high.

Furthermore, recent events have shown how the absolute and unqualified secrecy of
foreign currency deposits, and their exemption from government orders or 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 with the assurance that these will be
virtually beyond the reach of the State

This bill proposes amendments to Republic Act 6426, or the Foreign Currency Deposit Act of
the Philippines, that, while maintaining the secrecy and confidentiality 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 orders or processes be removed. f 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.



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

SIXTEENTH CONGRESS
First Regular Session

House Bill No.

Introduced by
ACT TEACHERS Party-List Representative Antonio L. Tinio

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

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

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. 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
Gozette or one (1) newspaper of general circulation

Approved,