Section 13Sec./Art. 13

The Subic Bay Metropolitan Authority. -

a. Creation of the Subic Bay Metropolitan Authority. - A body corporate to be known as the Subic Bay Metropolitan Authority is hereby created as an operating and implementing arm of the Conversion Authority.

b. Powers and Functions of the Subic Bay Metropolitan Authority - The Subic Bay Metropolitan Authority, otherwise known as the Subic Authority, shall have the following powers and functions:

1. To operate, administer, manage and develop the ship repair and ship building facility, container port, oil storage and refueling facility and Cubi Air Base within the Subic Special Economic and Free-port Zone as a free market in accordance with the policies set forth in Section 12 of this Act;

2. To accept any local or foreign investment, business or enterprise, subject only to such rules and regulations to be promulgated by the Subic Authority in conformity with the policies of the Conversion Authority without prejudice to the nationalization requirements provided for in the Constitution.

3. To undertake and regulate the establishment, operation and maintenance of utilities, other services and infrastructure in the Subic Special Economic Zone including shipping and related business, stevedoring and port terminal services or concessions, incidental thereto and airport operations in coordination with the Civil Aeronautics Board, and to fix just and reasonable rates, fares, charges and other prices therefor;

4. To construct, acquire, own, lease, operate and maintain on its own or through contract, franchise, license permits bulk purchase from the private sector and build-operate-transfer scheme or joint-venture the required utilities and infrastructure in coordination with local government units and appropriate government agencies concerned and in conformity with existing applicable laws therefor.

5. To adopt, alter and use a corporate seal; to contract, lease, sell, dispose, acquire and own properties; to sue and be sued in order to carry out its duties and functions as provided for in this Act and to exercise the power of eminent domain for public use and public purpose;

6. Within the limitation provided by law, to raise and/or borrow the necessary funds from local and international financial institutions and to issue bonds, promissory notes and other securities for that purpose and to secure the same by guarantee, pledge, mortgage, deed of trust, or assignment of its properties held by the Subic Authority for the purpose of financing its projects and programs within the framework and limitations of this Act;

7. To operate directly or indirectly or license tourism-related activities subject to priorities and standards set by the Subic Authority including games and amusements, exempt horse racing, dog racing and casino gambling which shall continue to be licensed by the Philippine Amusement and Gaming Corporation (PAGCOR) upon recommendation of the Conversion Authority; to maintain and preserve the forested areas as a national park;

8. To authorize the establishment of appropriate educational and medical institutions;

9. To protect, maintain and develop the virgin forests within the baselands which will be proclaimed as a national park and subject to a permanent total log ban, and for this purpose, the rules and regulations of the Department of Environment and Natural Resources and other government agencies directly involved in the above functions shall be implemented by the Subic Authority;

10. To adopt and implement measures and standards for environmental pollution control of all areas within its territory, including, but not limited to all bodies of water and to enforce the same. For which purpose the Subic Authority shall create an Ecology Center; and

11. To exercise such powers as may be essential, necessary or incidental to the powers granted to it hereunder as well as to carry out the policies and objectives of this Act.

c. Board of Directors - The powers of the Subic Authority shall be vested in and exercised by a Board of Directors, hereinafter referred to as the Board, which shall be composed of fifteen (15) members, to wit:

1. Representatives of the local government units that concur to join the Subic Special Economic Zone;

2. Two (2) representatives from the National Government;

3. Five (5) representatives from the private sector coming from the present naval stations, public works center, ship repair facility, naval supply depot and naval air station; and

4. The remaining balance to complete the Board shall be composed of representatives from the business and investment sectors.

The chairman and the members of the Board shall be appointed by the President to serve for a term of six (6) years, unless sooner removed for cause except for the representatives of the local government units who shall serve for a term of three (3) years. In case of removal for cause, the replacement shall serve only the unexpired portion of the term.

No person shall be appointed as a member of the Board unless he is a Filipino citizen, of good moral character, and of recognized competence in relevant fields including, but not limited to economics, management, international relations, law or engineering. Preference in the appointment of the members of the Board shall be given to residents within the Subic Special Economic Zone.

Members of the Board shall receive a per diem of not more than Five thousand pesos (P5,000)) for every board meeting:Provided, however,That the per diem collected per month does not exceed the equivalent of four (4) meetings:Provided, further,That the amount of per diem for every board meeting may be increased by the President: Provided, finally, That the amount of per diem shall not be increased within two (2) years after its last increase.

d. Chairman/Administrator - The President shall appoint a professional manager as administrator of the Subic Authority with a compensation to be determined by the Board subject to the approval of the Secretary of Budget, who shall be the ex officio chairman of the Board and who shall serve as the chief executive officer of the Subic Authority:Provided,however, That for the first year of its operations from the effectivity of this Act, the mayor of the City of Olongapo shall be appointed as the chairman and chief executive officer of the Subic Authority.

e. Capitalization- The Subic Authority shall have an authorized capital stock of Twenty billion pesos (P20,000,000,000) divided into twenty thousand (20,000) no-par shares fully subscribed and paid up by the Republic of the Philippines with:

1. All lands embraced, covered and defined in Section 12 hereof, as well as permanent improvements and fixtures upon proper inventory not otherwise alienated, conveyed, or transferred to another government agency.

2. All other assets which the President may transfer to the Subic Authority as part of the equity contribution of the Government; and

3. Cash contribution by the Government in the amount of Three hundred million pesos (P300,000,000) a year for the next three (3) years, which is hereby appropriated out of any fund in the National Treasury not otherwise appropriated.