[ Act No. 3084, March 16, 1923 ]

AN ACT TO AMEND SECTIONS ELEVEN HUNDRED AND SEVENTY-TWO AND ELEVEN HUNDRED AND SEVENTY-SIX OF THE ADMINISTRATIVE CODE, AS AMENDED BY ACTS NUMBERED TWENTY-SEVEN HUNDRED AND SIXTY- ONE AND TWENTY-NINE HUNDRED AND TWELVE

Be it enacted by the Senate and House of Representatives of the Philippines in Legislature assembled and by the authority of the same:SECTION 1. Section  eleven hundred and seventy-two of the Administrative Code, as amended  by Acts Numbered Twenty-seven hundred and sixty-one and Twenty-nine hundred  and twelve, is  hereby  further amended  to read as follows:

"SEC.  1172. Certificate of Philippine register.—Upon registration of a vessel of domestic ownership, and of more than fifteen tons gross, a certificate of Philippine register shall be issued for it.  If the vessel is  of domestic ownership and  of fifteen  tons gross  or less  the  taking  of  the certificate of Philippine  register  shall be optional with the owner." 'Domestic ownership,'  as  used in this section, means ownership vested in  some one  or more of the following classes of persons: (a) Citizens  of the Philippine Islands; (b) citizens of the United States residing in the Philippine Islands;  (c)  any corporation or company composed  wholly of citizens of the United  States or of the Philippine Islands, or of both, created  under the laws of the United  States, or of  any State  thereof,  or of the  Philippine Islands, provided  some duly authorized  officer thereof, or the agent, master or administrator of the vessel resides in  the Philippine Islands;  (d)  any corporation or company created under the laws of the United States, or of any State thereof, or of  the Philippine Islands, duly authorized to engage in business  in the  Philippine Islands,  provided seventy-five per centum at least  of the capital  stock thereof or  of  any interest in said  capital is wholly owned by citizens of the Philippine Islands, or  of the United States, or of both,  and provided some duly authorized officer thereof, or the agent, master or administrator  of the vessel resides in the  Philippine Islands; (e) any corporation or company created under the laws of the  United States, or of any State thereof, or of the Philippine Islands, provided some duly authorized officer thereof,  or the agent, master or administrator of the vessel resides in  the  Philippine Islands; Provided, That the certificate of Philippine register issued to a vessel be-. cause the owner thereof  comes under the provisions of  this subsection (e),  shall extend  to  the vessel the privilege of engaging only in the foreign or high-sea commerce, but not in the Philippine coastwise trade."Any vessel of more  than fifteen tons gross which on February  eighth, nineteen hundred and  eighteen, had a certificate of Philippine  register under  existing law, shall likewise  be deemed a vessel of domestic ownership so long as there  shall not be any change in the ownership nor  any transfer of stock of the  companies or corporations owning such vessel to persons who are not citizens of the Philippine Islands or of the United States."Under the terms of  this Act,  no corporation, firm or company shall be considered as of domestic ownership for the coastwise trade unless the president or managing directors thereof are citizens of the United States or of the Philippine Islands: Provided, however, That in the case of a corporation, association, firm or company operating any vessel in the coastwise trade,  the  controlling interest or capital stock held by citizens of the United  States or of the Philippine Islands,  or  both,  shall be seventy-five per centum of the capital  investment in the  same:  Provided, further, That the controlling interest in the  corporation shall  not be considered as held by citizens of the United States or of  the Philippine Islands:  (a) If the majority of the stock is not held by such  citizens and such stock is not subject to any trust or fiduciary obligation in favor of any person not a citizen of the United States or of the Philippine Islands; {b) if the majority of the votes  in said corporations is not in the hands of  citizens of  the United States  or of the Philippine Islands; (c)  if by  means of a contract or agreement, it has been so arranged that the majority  of the stock can be voted directly or indirectly in favor  of  any person not a citizen of the United States or of the Philippine Islands; (d) if by any other means, the control of the corporation is  conferred upon  or allowed to be  exercised by  any person  not a  citizen of the United States or of the Philippine Islands."It  shall not be considered that seventy-five per centum of the interest in a corporation are held by citizens of the United States or of the Philippine Islands: (a) If the certificates of seventy-five per centum of the capital  stock are not held  by such  citizens and such certificates are not subject to some trust or other fiduciary  obligation in favor of a person not a citizen of the United  States or the  Philippine Islands; (b) if seventy-five per centum of the votes of said corporation are not in the hands of citizens of the United States or of the Philippine Islands;  (c) if by means of some contract or agreement,  it  has been  so arranged that over twenty-five per centum of the stock in such  corporation or company can be voted directly  or  indirectly in favor  of any person not a  citizen of the United States or the Philippine Islands; (d)  if "by  any other  means, the control of any  interest in the corporation  in excess of twenty-five  per  centum has been  conferred upon or is allowed to be exercised by any person not  a  citizen of the United States or the Philippine Islands."The provisions  of  this  Act shall be applicable to the administrators and trustees of all  persons coming under the provisions of this Act and to the successors or assigns of such persons."

SEC.  2. Section eleven hundred and  seventy-six of the Administrative Code, as amended by  Act Numbered Twenty- seven  hundred and  sixty-one, is  hereby further amended to read as follows:

"SEC. 1176. Investigation into  character of vessel.—No application for a certificate of Philippine register shall be approved until the Collector of Customs is satisfied from an inspection of the vessel that it is engaged or destined to be engaged in legitimate trade and that  it is of domestic ownership as such  ownership is defined in  section eleven hundred and seventy-two of this Code."The  Collector of Customs may at any time make  an administrative investigation as to the ownership  or title of any vessel engaged in the coastwise trade and whether such title or ownership is in accordance with the requirements of this  Act; and any vessel chartered, sold, transferred, or mortgaged to any person not  a  citizen of the United States or the Philippine Islands  without previous permission of the  Insular Collector  of   Customs  or put under  foreign register or  Hag  without   such permission or operated in violation of any of the provisions of this Act, shall be seized by the Government of the Philippine Islands; and any person,  corporation, company or association violating any of the provisions of this Act shall be guilty of a misdemeanor and be punished by a fine of not  more than five thousand  pesos or imprisonment for not more than "five years, or both: Provided, That in the  event the person guilty of such violation is a corporation, company or association, the manager or, in his default, the president thereof shall be criminally  responsible for such violation.

SEC. 3.  This Act shall take effect on its approval.Approved, March 16, 1923.

Source: Supreme Court E-Library