Oil deregulation law: Case study on business implications of administrative regulations

• Main Author: Marasigan, Nerissa L.
• Format: text
• Language: English
• Published: Animo Repository 2012
• Online Access: https://animorepository.dlsu.edu.ph/etd_masteral/4287
• Institution: De La Salle University

Congress enacted the Downstream Oil Industry Deregulation Act in the year 1996 which aimed to encourage the entry of new players in the industry in order to provide the public with more choices and quality products. However, in 1997, the law was struck down and was declared unconstitutional because it prevented free trade in the industry: against the purpose of the law. In order to cure these defects, Congress enacted the Downstream Oil Industry Deregulation Act of 1998. It aims to liberalize and deregulate the industry in order to ensure a truly competitive market under a regime of fair prices, adequate and continuous supply of environmentally-clean and high-quality petroleum products through the promotion and encouragement of entry of new participants and the introduction of adequate measures to ensure the attainment of these goads. The Implementing Rules and Regulations of RA 8479 is a tool to ensure that the main provisions of the law are made to be effective. It should promote the purpose of the law it aims to implement and not provide additional burdens which may further prevent its fulfilment and cause to be a barrier in the entry of new players in the industry. Through the application of the Standard Cost Model in the computation of the costs of compliance of the reportorial requirements mandated by the Implementing Rules and Regulations, we are able to compute and evaluate if the equal treatment of the law to unequally situated entities acts as a barrier to entry in the Downstream Oil Industry.