Southern Cross Cement Corp vs Philippine Cement Manufacturers’ Corporation

FACTS: Petitioner Southern Cross Cement Corporation (Southern Cross) is a domestic corporation engaged in the business of cement manufacturing, production, importation and exportation. Private respondent Philippine Cement Manufacturers Corporation (Philcemcor) is an association of domestic cement manufacturers. DTI accepted an application from Philcemcor, alleging that the importation of gray Portland cement in increased quantities has caused declines in domestic production, capacity utilization, market share, sales and employment; as well as caused depressed local prices. Accordingly, Philcemcor sought the imposition a definitive safeguard measures on the import of cement pursuant to the Safeguard Measures Act.

The Tariff Commission received a request from the DTI for a formal investigation to determine whether or not to impose a definitive safeguard measure on imports of gray Portland cement

Tariff Commission’s report: The elements of serious injury and imminent threat of serious injury not having been established, it is hereby recommended that no definitive general safeguard measure be imposed on the importation of gray Portland cement

After reviewing the report, then DTI Secretary Manuel Roxas II (DTI Secretary) disagreed with the conclusion of the Tariff Commission that there was no serious injury to the local cement industry caused by the surge of imports. In view of this disagreement, the DTI requested an opinion from the Department of Justice (DOJ) on the DTI Secretarys scope of options in acting on the Commissions recommendations.

Subsequently, then DOJ Secretary Hernando Perez rendered an opinion stating that Section 13 of the SMA precluded a review by the DTI Secretary of the Tariff Commissions negative finding, or finding that a definitive safeguard measure should not be imposed.

DTI then denied application for safeguard measures against the importation of gray Portland cement

Philcemcor received a copy of the DTI Decision on 12 April 2002. Ten days later, it filed with the Court of Appeals a Petition for Certiorari, Prohibition and Mandamus seeking to set aside the DTI Decision, as well as the Tariff Commissions Report. On the other hand, Southern Cross filed its Comment arguing that the Court of Appeals had no jurisdiction over Philcemcors Petition, for it is on the Court of Tax Appeals (CTA) that the SMA conferred jurisdiction to review rulings of the Secretary in connection with the imposition of a safeguard measure.

ISSUE: Whether or not the CA has jurisdiction over the case which is concerned with imposition of safeguard measures

RULING: CTA has jurisdiction.  Under Section 29 of the SMA, there are three requisites to enable the CTA to acquire jurisdiction over the petition for review contemplated therein: (i) there must be a ruling by the DTI Secretary; (ii) the petition must be filed by an interested party adversely affected by the ruling; and (iii) such ruling must be in connection with the imposition of a safeguard measure. The first two requisites are clearly present. The third requisite deserves closer scrutiny.

Contrary to the stance of the public respondents and Philcemcor, in this case where the DTI Secretary decides not to impose a safeguard measure, it is the CTA which has jurisdiction to review his decision. The reasons are as follows:

First. Split jurisdiction is abhorred. The law expressly confers on the CTA, the tribunal with the specialized competence over tax and tariff matters, the role of judicial review without mention of any other court that may exercise corollary or ancillary jurisdiction in relation to the SMA.

Second. The interpretation of the provisions of the SMA favors vesting untrammeled appellate jurisdiction on the CTA.

A plain reading of Section 29 of the SMA reveals that Congress did not expressly bar the CTA from reviewing a negative determination by the DTI Secretary nor conferred on the Court of Appeals such review authority. Respondents note, on the other hand, that neither did the law expressly grant to the CTA the power to review a negative determination. However, under the clear text of the law, the CTA is vested with jurisdiction to review the ruling of the DTI Secretary in connection with the imposition of a safeguard measure. Had the law been couched instead to incorporate the phrase the ruling imposing a safeguard measure, then respondents claim would have indisputable merit. Undoubtedly, the phrase in connection with not only qualifies but clarifies the succeeding phrase imposition of a safeguard measure. As expounded later, the phrase also encompasses the opposite or converse ruling which is the non-imposition of a safeguard measure.

Third. Interpretatio Talis In Ambiguis Semper Fienda Est, Ut Evitur Inconveniens Et Absurdum.

Even assuming arguendo that Section 29 has not expressly granted the CTA jurisdiction to review a negative ruling of the DTI Secretary, the Court is precluded from favoring an interpretation that would cause inconvenience and absurdity. Adopting the respondents position favoring the CTAs minimal jurisdiction would unnecessarily lead to illogical and onerous results.