Tuesday, July 15, 2008 MOA signed to brace task force vs 'predatory' oil firms
THE Department of Justice (DOJ) and the Department of Energy (DOE) on Monday signed an amended memorandum of agreement (MOA) to beef up the joint Task Force on Oil Deregulation against what it called "predatory" oil price manipulation.
During the signing ceremony held at the DOJ, Justice Secretary Raul Gonzalez Sr. and Energy Secretary Angelo Reyes agreed to empower the task force with the backing of a prosecutorial arm in going after oil companies engaged in unreasonable price hikes of petroleum products.
Unreasonable price hikes are prohibited under Republic Act (RA) 8479, otherwise known as the "Downstream Oil Industry Deregulation Act of 1988."
The DOJ and the DOE first signed the agreement last March 12, 1998, which is intended to give the task force more teeth to enforce RA 8479.
The Task Force is co-chaired by DOE Undersecretary Roy Kyamko and DOJ Undersecretary Jose Vicente Salazar.
Under the amended MOA, the DOJ will be assigning two state prosecutors to assist the members of the task force in issuing subpoena and conducting "motu propio" preliminary investigation into alleged predatory oil pricing and manipulation.
"The task force will address the need in deregulated environment, where the prices are determined by demand and supply and not by a single agency or a single entity," Reyes said.
Reyes said prior to the amendments in the MOA, the task force has no power to issue subpoenas and conduct preliminary investigation.
Now, the report of the task force, if found sufficient in form and content, will be forwarded to the panel of state prosecutors duly designated by the justice secretary.
The state prosecutors will then issue a subpoena to the respondent for the purpose of conducting a preliminary investigation.
Within 10 days from receipt of subpoena, the respondent may submit counter-affidavits and other supporting documents and will be allowed to examine all the evidence considered in the findings of the task force.
In case of the failure of the respondent to submit a counter-affidavit, the task force is tasked to resolve the case based on the records and evidence on hand.
Among the parameters to be considered in determining whether there has been an "unreasonable increase" in the prices of petroleum products are movements in world prices, foreign exchange fluctuations, violation of reportorial requirements and timing and frequency.
The task force will have 30 days to come up with a recommendation on whether there is a probable cause to warrant the filing of a complaint for cartelization and predatory pricing against the respondent. (ECV/Sunnex)
