Article 47Supplement v1, p. 47

COMMERCIAL LAWS SUPPLEMENT

service, producing or distributing quality products, having

business acumen, and enjoying the use of protected

intellectual property rights as violative of the Act and

these

Rules,

Provided, that the concerned entity or

entities invoking the exception shall clearly establish to

the Commission's satisfaction, that the barrier to entry or

anti-competitive act is an indispensable and natural

result

of

the

superior

product

or

process,

business

acumen, or legal rights or laws.

RULE 9 Forbearance

SECTION 1. Forbearance of the Commission. —

The Commission, motu proprio or upon application, prior

to its initiation of an inquiry, may forbear from applying

the provisions of the Act or these Rules, for a limited time,

in whole or in part, in all or specific cases, on an entity or

group of entities, if in its determination:

(a) Enforcement is not necessary to the attainment of the

policy objectives of this Act;

(b) Forbearance will neither impede competition in the

market where the entity or group of entities seeking

exemption operates nor in related markets;

(c) Forbearance is consistent with public interest and the

benefit and welfare of the consumers; and

(d) Forbearance is justified in economic terms;

Provided,

that

forbearance

will

be

granted

for

a

maximum period of one year. Any extension to the period

will have to be expressly approved by the Commission.

Any extension of the duration of an exemption shall not

be longer than one year.

SECTION 2. Public Hearing. —

(a)

A

public

hearing

shall

be

held

to

assist

the

Commission in making its determination under Section 1

of this Rule.

(b) The Commission's order exempting the relevant entity,

or group of entities under this Rule shall be made public.

Conditions may be attached to the forbearance if the

Commission

deems

it

appropriate

to

ensure

the

long-term interests of consumers.

(c) In the event that the basis for the issuance of the

exemption order ceases to be valid, the order may be

withdrawn by the Commission.

RULE 10 Final Provisions

SECTION 1. Revisions of These Rules. —

The Commission may revise these Rules whenever it

deems

necessary

and

after

due

consultation

with

affected stakeholders.

SECTION 2. Separability Clause. —

Should any provision herein be subsequently declared

unconstitutional, the same shall not affect the validity or

legality of the other provisions.

SECTION 3. Effectivity. —

These Rules shall take effect fifteen (15) days after the

date of its publication in at least two (2) newspapers of

general circulation.

Approved, this 31st day of May 2016.

(Implementing Rules and Regulations of Republic Act

No. 10667, IRR of RA 10667, [May 31, 2016])

RA No 10142 | Financial Rehabilitation

and Insolvency (FRIA) Act of 2010

July 18, 2010 *

REPUBLIC ACT NO. 10142

AN ACT PROVIDING FOR THE REHABILITATION OR

LIQUIDATION OF FINANCIALLY DISTRESSED

ENTERPRISES AND INDIVIDUALS

CHAPTER I General Provisions

SECTION 1. Title. — This Act shall be known as the

"Financial Rehabilitation and Insolvency Act (FRIA) of

2010".

SECTION 2. Declaration of Policy. — It is the policy of the

State to encourage debtors, both juridical and natural

persons, and their creditors to collectively and realistically

resolve and adjust competing claims and property rights.

In furtherance thereof, the State shall ensure a timely, fair,

transparent,

effective

and

efficient

rehabilitation

or

liquidation of debtors. The rehabilitation or liquidation

shall be made with a view to ensure or maintain certainty

and predictability in commercial affairs, preserve and

maximize

the value of the assets of these debtors,

recognize creditor rights and respect priority of claims,

and ensure equitable treatment of creditors who are

similarly situated. When rehabilitation is not feasible, it is

in the interest of the State to facilitate a speedy and

orderly

liquidation

of

these debtors' assets and the

settlement of their obligations.

SECTION 3. Nature of Proceedings. — The proceedings

under this Act shall be in rem. Jurisdiction over all

persons affected by the proceedings shall be considered

as

acquired

upon

publication

of

the

notice

of the

commencement of the proceedings in any newspaper of

general circulation in the Philippines in the manner

prescribed by the rules of procedure to be promulgated

by the Supreme Court.

The proceedings shall be conducted in a summary and

non-adversarial manner consistent with the declared

policies of this Act and in accordance with the rules of

procedure that the Supreme Court may promulgate.

SECTION 4. Definition of Terms. — As used in this Act, the

term:

(a)

Administrative

expenses

shall

refer

to

those

reasonable and necessary expenses:

(1) incurred or arising from the filing of a petition under

the provisions of this Act;

(2) arising from, or in connection with, the conduct of the

proceedings under this Act, including those incurred for

the rehabilitation or liquidation of the debtor;

(3) incurred in the ordinary course of business of the

debtor after the commencement date;

(4) for the payment of new obligations obtained after the

commencement date to finance the rehabilitation of the

debtor;

(5) incurred for the fees of the rehabilitation receiver or

liquidator and of the professionals engaged by them; and

(6) that are otherwise authorized or mandated under this

Act or such other expenses as may be allowed by the

Supreme Court in its rules.

(b) Affiliate shall refer to a corporation that directly or

indirectly,

through

one

or

more

intermediaries,

is

controlled by, or is under the common control of another

corporation.

(c) Claim shall refer to all claims or demands of whatever

nature or character against the debtor or its property,

whether

for

money

or

otherwise,

liquidated

or

unliquidated, fixed or contingent, matured or unmatured,

disputed or undisputed, including, but not limited to: (1)

all claims of the government, whether national or local,

including taxes, tariffs and customs duties; and (2) claims

against directors and officers of the debtor arising from

acts done in the discharge of their functions falling within

the scope of their authority: Provided, That, this inclusion

does not prohibit the creditors or third parties from filing

cases against the directors and officers acting in their

personal capacities.

© Compiled by RGL

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