SC affirms barring operation of 3 mining firms in PH


Posted at Mar 15 2015 04:03 PM | Updated as of Mar 16 2015 08:50 PM

MANILA - The Supreme Courts affirmed its decision made last year that barred three mining corporations from operating in the country.

The decision was based on the constitutional provision that limits foreign-owned companies operating in the Philippines to 40 percent.

In a resolution by Associate Justice Presbitero Velasco Jr., the Third Division junked the motion for reconsideration filed by Narra Nickel and Mining Development Corp., Tesoro Mining and Development Inc. and McArthur Mining Inc.

The high court said the case was not rendered moot and academic after the Mineral Production Sharing Agreements (MPSA) were converted to Financial Technnical Assistance Agreements (FTAA).

"Indeed, as the Court clarified in its decision, the conversion of the MPSA application to one for FTAAs and the issuance by the OP (Office of the President) of an FTAA in petitioners’ favor are irrelevant. The OP itself has already cancelled and revoked the FTAA thus issued to petitioners," the Court said.

The SC also rejected the argument that nationality was not an issue due to MBMI Resources selling and transferring all its shareholdings and stockholders to DMCI Mining Corp., a Filipino corporation.

"Furthermore, the supposed sale by MBMI of its shares in the petitioner- corporations and in their holding companies is not only a question of fact that this Court is without authority to verify, it also does not negate any violation of the Constitutional provisions previously committed before any such sale," it said.

With finality, the SC said it shall no longer entertain pleadings concerning the case.

In its decision published April 2014, the High Court sustained the motion made by the Court of Appeals, which ruled that the petitioners were not entitled to MPSAs.

The Court upheld the finding made by the appellate court that the petitioners' nationality was doubtful, because the 100 percent Canadian-owned firm, MBMI Resources, Inc., owns 60 percent of the common stocks of the petitioner.

The case stems from a case filed by Filipino-owned Redmont Consolidated Mines Corp. against three mining companies claiming that they are owned and controlled by MBMI Resources Inc.

In 2006, applications for MPSA assigned to Narra, Tesoro and McArthur amounted to more than 12,100 hectares in Palawan.

It was only in December 14, 2007 that the Panel of Arbitrators (POA) of the Department of Environment and Natural Resources ruled that Narra, Tesoro, and McArthur are foreign companies and therefore disqualified to engage in mining activities.

Their respective applications for MPSAs were declared null and void, giving due course to Redmont's application for an exploration permit.

In September 10, 2008, the Mines Adjudication Board reversed POA's decision.

Redmont later elevated the case to the CA after MAB denied its motion for reconsideration. The CA ruled in favor of Redmont in October 1, 2010.

"The intricate corporate layering utilized by the Canadian company, MBMI Resources Inc, is of exceptional character and involves paramount public interest since it undeniably affects the exploitation of our country’s natural resources," the SC explained.

Concurring to the ruling were Associate Justices Diosdado Peralta and Jose Catral Mendoza; while Associate Justice Marvic Leones stood on dissent.