An Open Letter to the Honorable Members of the Commission on Appointments

We wish to point out a legal controversy regarding the appointment of Mr. Rafael Buenaventura as the new governor of the Bangko Sentral ng Pilipinas (BSP). The new Central Bank Act (Sec. 6(a) provides that “the governor of the Bangko Sentral shall be head of a department and his appointment shall be subject to confirmation by the Commission on Appointments.” In this light, we appeal to the Commission on Appointments (CA) to exercise its right, if not fulfill its obligation, to subject to the confirmation process President Estrada’s appointment of Mr. Rafael Buenaventura to the position of Bangko Sentral governor. We expect that Malacañang will refuse to submit its appointment of BSP governor to the CA. We surmise that Malacañang will base its argument on a Supreme Court interpretation of the relevant constitutional provision. Section 16, Article 7 of the 1987 Constitution states:

The President shall nominate and, with the consent of the Commission on Appointments, appoint the heads of the executive departments, ambassadors, other public ministers and consuls, or officers of the armed forces form the rank of colonel or naval captain, and other officers whose appointments are vested in him in this Constitution. He shall also appoint all other officers of the Government whose appointments are not otherwise provided for by law, and those whom he may be authorized by law to appoint. The Congress may, by law, vest the appointment of other officers lower in rank in the President alone, in the courts, or in the heads of departments, agencies, commissions or boards.

The President shall have the power to make appointments during the recess of Congress, whether voluntary or compulsory, but such appointments shall be effective only until disapproval by the Commission on appointments or until the next adjournment of the Congress.

The Supreme Court has had several occasions to interpret the meaning of this Constitutional provision in several controversies raised before it. These occasions include Sarmiento III v Mison (G.R. No. 79974, 17 December 1987); Concepcion Bautista v Salonga (G.R. No. 86439, 13 April 1989); Quintos Deles, et.al. v the Commission on Constitutional Commissions, et.al. (G.R. No. 83216, 4 Sept 1989); and Calderon v Carale (G.R. No. 91636, 23 April 1992). In Calderon v Carale, the Supreme Court laid down the applicable doctrines relating to the power of the CA to confirm appointments. First, confirmation by the CA is required only for presidential appointees mentioned in the first sentence of Section 16, Article 7. Second, confirmation is not required when the President appoints other government officers whose
appointments are not otherwise provided for by law, and those officers whom he may be authorized by law to appoint. Finally, Congress may not by law require confirmation of appointments extended by the president to officers additional to those expressly mentioned in the first sentence of Section 16, Article VII of the Constitution.

The command of the New Central Bank Act to subject the appointment of the BSP governor to confirmation by the CA must thus conform to the relevant Constitutional provision, as interpreted by the Supreme Court. In this regard, we raise the following issues:

  1. To date, the Supreme Court has yet to pass upon the validity of
    the provision in the New Central Bank Act requiring confirmation of the appointment to the position of BSP governor. The issue of the validity of the provision was raised in the case of Tarrosa v Singson (G.R. No. 111243, 25 May 1994), but this case was dismissed for lack of standing on the part of the petitioner
  2. True, the Supreme Court in the Tarrosa case, by way of an aside,
    called attention to its ruling in Calderon v Carale that Congress
    cannot by law expand the confirmation powers of the CA beyond the
    express enumeration in the first sentence of Section 16 of Article VII
    of the Constitution. Still, we ask whether the relevant provision in
    the New Central Bank Act represents a movement in the Constitutional
    boundary. In Sec 6 (a) of the New Central Bank Act, Congress categorized the position of BSP governor as head of a department, placing it within the scope of the first sentence of Section 16 of Article VII of the Constitution.
  3. Such categorization made by Congress, and concurred in by then
    President Ramos when he signed the New Central Bank Act into law, must be presumed to have been made in good faith. That is, Congress passed such categorization after a considered estimation of the scope of its constitutional powers given the state of the law and jurisprudence. We emphasize that the New Central Bank Act was approved into law on 14 June 1993, much later than the date of promulgation of the ruling in Calderon v Carale.

Given the above, we respectfully submit that the constitutionality of the provision in the New Central Bank requiring CA confirmation of the appointment to the position of BSP governor has yet to be conclusively passed upon by the Supreme Court. Such command of the New Central Bank Act must be respected, and until declared unconstitutional by the Supreme Court, must be accorded the presumption of validity.

The issue gains greater significance, given that the new BSP governor is equipped with vast economic power and responsibility. In this respect, the appointment of the BSP governor cannot be divorced from the debate on policies and qualifications. Much has to be done to introduce policy and institutional reforms in the BSP, in the wake of the financial crisis. The CA, in the exercise of its confirmation powers, must be satisfied that the newly appointed governor is the most appropriate person for the job.

Moreover, Mr. Buenaventura has to hurdle another obstacle. On the qualification issue, we ask whether the appointment of Mr. Buenaventura
does not suffer from a legal impediment as expressed in Section 9 of the New Central Bank Act. Section 9 states that “no person shall be a member of the Monetary Board if he has been connected directly with any multilateral banking or financial institution or has a substantial interest in any private bank in the Philippines, within one (1) year prior to his appointment.”

Mr. Buenaventura is the president and chief executive officer of PCIBank. As such, he is deeply involved in the exercise of corporate powers at PCIBank, and to be sure personally identifies with the interests of the bank. This places him within the purview of the one-year bar for having “a substantial interest in any private bank in the Philippines.”

The ball is now in the CA court. We hope that the honorable members of the CA will act in the best interests of our people and set in motion the clarification of the legal questions through the proper process.

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