Political Finance in the Philippines:

Legal Framework

Basic Constitutional Principles governing Political Finance in

the Philippines• Equal Access to Opportunities for Public Service

[Art. II, Sec. 26, Phil. Const.] – More Filipinos should be afforded the opportunity to

serve the public as government leaders and that Money should not be the deciding factor in elections.

– Election Campaign must be affordable to more people to encourage competent, deserving and well intentioned citizens to seek public office.

• Accountability of Public Officers.– Public office is a public trust. Public officers

and employees must at all times be accountable to the people [Art. XI Sec. 1 Phil. Const.]

– Direct relationship between quality of governance and election expenditure. Candidates must be transparent and accountable to the people in the conduct of their campaign.

• Accountability of Public Officers.– Public office is a public trust. Public officers

and employees must at all times be accountable to the people [Art. XI Sec. 1 Phil. Const.]

– Direct relationship between quality of governance and election expenditure. Candidates must be transparent and accountable to the people in the conduct of their campaign.

• COMELEC as the independent state institution mandated to enforce all laws and regulations related to elections, including campaign finance regulations,….– … … to investigate and prosecute cases of

violations of election laws. – ……. and to recommend to the Congress

effective measures to minimize election spending [Art. IX-C, Sec. 2 (1)(6)(7), Phil. Const.]

Statutes governing Political Finance

• Batas Pambansa Blg. 881 – The Omnibus Election Code (OEC)

• Republic Act 7166 – Synchronized Election Law for the 1992 Elections

• Republic Act 9006 – Fair Election Act

• COMELEC Resolution No. 7794

Definition of Basic Terms:

• Candidate - any person aspiring for an elective public office, who has filed a certificate of candidacy [Sec. 79 (a) OEC]

• Election Campaign or Partisan Political Activity - an act designed to promote the election or defeat of a particular candidate or candidates to a public office. [Sec. 79 (b) OEC]

Election Contribution – gift, donation, subscription, loan, advance or

deposit of money or anything of value, or – a contract, promise or agreement to

contribute, whether or not legally enforceable,– use of facilities donated by other persons, the

money value of which can be assessed based on the rates prevailing in the area

• for the purpose of influencing the results of the elections [Sec. 94 (a), OEC]

Election Expenditure – payment or delivery of money or anything of

value, or – a contract, promise or agreement to make an

expenditure,– use of facilities personally owned by the

candidate, the money value of the use of which can be assessed based on the rates prevailing in the area.

• for the purpose of influencing the results of the election. [Sec. 94 (b) OEC]

Sources of Funds or the Income Side of Political Finance

• Own Money of Candidate

• Donation or Election Contribution from persons or corporation not prohibited by law to give donations. Elections Donations REPORTED TO COMELEC are exempt from donor’s tax. [Sec. 13 RA 7166]

• From Fund Raising Activities

Election Contribution from the following is prohibited

• Public or private financial institutions, but loans in the ordinary course of business are allowed;

• Individuals or corporations operating a public utility or in possession of or exploiting any natural resources of the nation;

• Individuals or corporations who hold contracts or sub-contracts to supply the government with goods or services or to perform construction or other works;

• Individuals or corporations who have been granted franchises, or similar privileges or concessions by the government;

• Individuals or corporations who, within one year prior to the date of the election, have been granted loans in excess of P100,000 by the government;

• Educational institutions which have received grants of public funds amounting to no less than P100,000.00;

• Officials or employees in the Civil Service, or members of the Armed Forces of the Philippines; and

• Foreigners and foreign corporations. [Sec. 95, 81, 96 OEC]

• Soliciting funds from above sources is also prohibited by law [Sec. 95, 96, OEC]

• Violation is an election offense punishable by 1 to 6 years of imprisonment, disqualification to hold public office and in the exercise of right of suffrage. Candidates involved can be disqualified from being running in the elections. [Sec. 81, 95, 96, 262, 264, 68,OEC]

Prohibited fund raising for election campaign during election period

• Holding dances, lotteries, cockfights, games, boxing bouts, bingo, beauty contests, entertainments, or cinematographic, theatrical or other performances [Sec. 97, OEC]

• Violation is an election offense punishable by 1 to 6 years of imprisonment, disqualification to hold public office and in the exercise of right of suffrage. Candidates involved can be disqualified from being running in the elections [Sec. 97, 262, 264, 68, OEC]

Reportorial Requirements

• Election Contributors or Donors must report their donation under oath to COMELEC within 30 days after the election, reflecting their true name, stating the amount of each contribution, the name of the candidate, agent of the candidate or political party receiving the contribution, and the date of the contribution. [Secs 98, 99, OEC]

• Violation is an election offense punishable by 1 to 6 years of imprisonment, disqualification to hold public office and in the exercise of right of suffrage. [Sec. 98, 262, 264, OEC]