The Office of the Government Corporate Counsel (OGCC) is the principal and statutory law office of government-owned-and-controlled corporations (GOCC’s), their subsidiaries, government financial institutions, government corporate offspring, government instrumentalities with corporate powers and government acquired asset corporations. Founded in 1935, it continues to celebrate its Diamond Years of Service and Upholding Justice.
The OGCC first began as a small corporate counsel division under the Department of Justice (DOJ) on 1 December 1935. But its humble beginnings did not stymie the likes of the late former Senator and Associate Justice of the Supreme Court Ramon Diokno from serving as head of the corporate counsel division.
When World War II broke out in 1941, the corporate counsel division was “abolished” to pave the way for creation of the Office of the Legal Adviser of GOCCs, under the Chairmanship of the Executive Commission. Shortly after the war, the corporate counsel division was re-organized, re-established and finally became the Office of the Government Corporate Counsel (OGCC) under Executive Order No. 94.
However, it was not until 1950 that the corporate counsel division formally came to be known and referred to as the OGCC, pursuant to Executive Order No. 392. Then, on 5 January 1951, Executive Order 400 transferred the undersized but promising unit under the Office of the Solicitor General (OSG). But not long after, or on 19 June 1959, Republic Act (RA) 2327, generally referred to as the Charter of OGCC, was signed into law. Under this charter, the OGCC became a separate and distinct office from the OSG.
As it happened, RA 2327 would be the first in a series of legislations that would catapult the OGCC into the agency that it is today. Thus, on 2 June 1963, Republic Act 3838 amended RA 2327. Apart from defining the powers of the GCC as statutory legal counsel of all GOCCs, it placed all GOCC legal departments under the control and supervision of the GCC and “discouraged” GOCCs from their long-standing practice of hiring private law practitioners without the written consent of the Government Corporate Counsel (GCC).
To further strengthen and enlarge the composition of the Office, on 4 August 1969, Republic Act 6000 conferred the rank of Judges of Court of First Instance to the three (3) Assistant Government Corporate Counsels (AGCCs) at that time.
But the metamorphosis of the OGCC was far from over. Under President Ferdinand E. Marcos, it underwent further reorganizations, the most notable of which came with the issuance of Executive Order (EO) 878. This Executive Order conferred upon the GCC the same rank, emoluments and privileges as that of the Presiding Justice of the Court of Appeals, and the Deputy Government Corporate Counsel (DGCC) the rank, emoluments and privileges equivalent to an Associate Justice of the Court of Appeals. Finally, seven (7) additional AGCCs were added to the original three (3), and these ten (10) AGCCs were given the rank, emoluments and privileges of a Regional Trial Court Judge.
On 25 July 1987, former President Corazon Aquino issued Executive Order 292, otherwise known as the Administrative Code of 1987. This reinforced the unique role of the OGCC as statutory legal counsel of all GOCCs, their subsidiaries, other corporate offspring, and government acquired asset corporations.
The OGCC’s mandate as counsel for government corporations is clear. This was further amplified in Land Bank of the Philippines vs. Teresita Panlilio-Luciano (G.R. 165428, 13 July 2005), where the Supreme Court judiciously clarified and set right what was described as “years of wrong practice”. Despite arguments grounded on convenience, the Supreme Court was unmoved and unwilling to set aside decades-old legal precept behind the Administrative Code of 1987’s categorical designation of the OGCC as the principal law office of GOCCs. The High Court likewise emphasized the absolute requirement for the OGCC to exercise control and supervision over legal departments of GOCCs. Said the Court: “[t]he correlative advantage of the OGCC might not necessarily be derived from years of experience, but putatively from its vantage point as overseer of all legal processes emanating from and involving all GOCCs.”
Today, the OGCC continues to exercise such mandate with more vigor, ever committed to push itself beyond its normal limitations to render efficient, personalized and creative legal service to its clients.
To serve as the principal law office
The Supreme Court held that the primary function of the OGCC is to serve as the principal law office of all GOCCs, their subsidiaries, other corporate offsprings, government financial institutions and government acquired asset corporations. This has wide repercussions since this primary obligation spawns further specific obligations imposed upon lawyers.
First. As distinguished from the “people’s tribune” character of the Office of the Solicitor General, it is the inescapable duty of the OGCC to represent GOCCs in cases for or against them, regardless of the nature of the cases and/or the strength of the legal position of the GOCC. As counsel, it is the duty of the OGCC to advocate the GOCC’s cause, leaving to the judge the duty to determine the merits of a case. Furthermore, as the primary law office, the OGCC is the recognized source of legal advice on major legal issues as well as day-to-day matters affecting GOCCs.
Second. In performing their duties, OGCC lawyers are duty bound to observe the Code of Professional Responsibility and the Canons of Professional Ethics. The GOCCs as well as the taxpayers can demand the observance thereof by the handling OGCC lawyers. This means that, in connection with the primary responsibility of the OGCC for the handling of the legal affairs of the GOCCs, the OGCC is also responsible for the manner by which the legal affairs are handled.
Third. A derivative obligation is imposed upon OGCC (and legal departments and external counsel) to recognize and come to terms with a hierarchy, insofar as the legal affairs of GOCCs are concerned, that places the OGCC above legal departments and external counsel of GOCCs. Thus, the OGCC is ultimately responsible for the legal advise it dispenses, and must necessarily assert its authority in order to properly discharge this responsibility. (Cf., Administrative Code of 1987)
To control and supervise the legal department of GOCCs
The OGCC is also tasked to exercise control and supervise the legal departments of the various government corporations. A government corporation’s in-house lawyer is an important component since he is more focused on the corporation’s particular legal affairs and is more closely exposed to the various factual and legal issues faced by it. Indeed, in Land Bank (supra), the Supreme Court admits that “x x x there are permissible levels of delegation of authority the OGCC may cede to the legal department it supervises.” But such delegation of authority “cannot be construed in such a manner that would result in a surrender or abdication of powers by the office charged with its performance.” Thus, the engagement of external counsel has been limited to situations of manifest necessity.
On 27 August 1998, President Joseph Estrada issued Memorandum Circular 9, Section 3 of which provides that “in exceptional cases, the written conformity and acquiescence of the Solicitor General or the Government Corporate Counsel, as the case may be, and the written concurrence of the Commission on Audit shall first be secured before the hiring or employment of a private lawyer or law firm.”
To ensure harmony of legal positions
The OGCC is likewise mandated to ensure consistency and/or harmony of the legal positions of the various GOCCs. With various in-house lawyers serving the GOCCs, it is the OGCC’s duty to keep in check and ensure that the legal position pursued by these lawyers are harmonized and follows a uniform convention. As the Supreme Court so eloquently puts it in Land Bank (supra), the OGCC’s “perspective is less myopic than that maintained by a particular legal department of a GOCC.” As such, the OGCC is indeed in the best position to orchestrate, guide, and direct the legal efforts of all lawyers serving the GOCCs.
To arbitrate issues between GOCCs
As the common lawyer to various GOCCs, being keenly involved in its legal concerns, and as a partner in formulating informed corporate decisions, the OGCC has a unique vantage and role in arbitrating and resolving conflicts between them.
In Philippine Veterans Investment Development Corp. vs. Alejandro M. Velez, the Supreme Court sustained the constitutionality of Presidential Decree (PD) 242 that prescribes the procedure for the administrative settlement and adjudication of disputes, claims, and controversies between or among GOCCs. It further characterized the process as a necessary adjunct to the regular court processes, describing it “an alternative to, or a substitute for, traditional litigation in court with the added advantage of avoiding the delays, vexations and expense of court proceedings.”
To issue rules and regulations
The power given to the OGCC to issue rules and regulations is a necessary adjunct to the power of supervision and control. Section 10 of the Administrative Code of 1987 expressly grants the OGCC the power to issue rules and regulations. In 2011, the OGCC issued its Revised Rules and Regulations of the OGCC.
To assess fees and to receive attorney’s fees adjudged in favor of GOCCs
The right of the OGCC to make assessments on GOCCs is expressly provided for in its Charter. This is a necessary part of the funding requirements of the OGCC. In fact, part of the reason for the Supreme Court’s unwillingness to dispense with the participation of the OGCC in the legal affairs of GOCCs stems from the fact that the OGCC would eventually be deprived of its due funding as sourced from possible attorney’s fees that may rightly be awarded to it.
Presently, the OGCC caters to the legal needs of about six hundred (600) Government Corporations classified into the following sectors: (1) Education, Training and Allied Services; (2) Economic Zones; (3) Information and Energy; (4) Environment and Water; (5) Banking; (6) Infrastructure and Transportation; (7) Agriculture and Trade; and (8) Housing.
The OGCC is strategically divided into teams to meet the specialized needs of the various sectors afore-mentioned, with an additional team handling Special Concerns.
The lawyers of the OGCC: (1) represent Government Corporations before the courts and quasi-judicial bodies; (2) render legal opinions; (3) review contracts; (4) investigate administrative cases against officials of Government Corporations; and (5) act as hearing officers in disputes among Government Corporations. The OGCC has control and supervision over the legal departments of Government Corporations and has the authority to allow the hiring of private lawyers by the Government Corporations.
Through the Institute for Public Corporate Governance (IPCG), the OGCC: (1) organizes mandatory continuing legal education modules for lawyers of the OGCC and Government Corporations; (2) advances corporate governance through seminars and adoption of a Code of Corporate Governance; (3) recognizes outstanding policy and legal researches affecting Government Corporations; and (4) publishes and compiles materials for use by Government Corporations. The OGCC is also involved in propagating Public-Private Partnerships through joint ventures and build-operate-transfer schemes, advancing Quality Management Systems, and assisting the Office of the President in disseminating information and policies to the Government Corporations.
TThe qualifications, salary grades, privileges and benefits of the Government Corporate Counsel (“GCC”), the Deputy Government Corporate Counsel (“DGCC”), 10 Assistant Government Corporate Counsels (“AGCC”), and 45 Government Corporate Counsels (“GCA”) are aligned with members of the Judiciary from the Presiding Justice of the Court of Appeals to Judges of Municipal Trial Courts. While the DGCC, AGCCs and GCAs are career officials, the GCC occupies a co-terminus position. Currently, there are 53 lawyers and 59 administrative staff in the OGCC’s plantilla.
The Unveiling of a New and Transformed OGCC
The OGCC today is an even more relevant, efficient, policy-oriented and professional organization. The significant strides in the past years were made possible by the unwavering commitment of its past leaders, together with the pro-active involvement of the men and women, lawyers and administrative personnel alike, of the OGCC.
The past years saw the establishment of the Institute of Public Governance (IPCG), an attached office of the OGCC dedicated to promoting government accountability and transparency, and the pursuit of relevance in today’s global environment.
In his first day in office in November 2010, GCC Raoul Creencia underscored the importance of the IPCG and committed to pursue its instrumental role in promoting responsive and responsible public corporate governance. GCA Edwin M. Carillo was later appointed as IPCG’s Executive Director, who was instrumental in organizing lectures and MCLE programs for lawyers in the government corporate sector. The holding of these lectures continues to this day.
Public Recognition of Government Corporations and OGCC
The OGCC was instrumental in the issuance of Presidential Proclamation No. 1613 (2008) declaring every first week of December as “Government Corporations and OGCC Week” simultaneous with the celebration of the founding anniversary of the OGCC. In 2011, the OGCC celebrated its Diamond (75th) Anniversary — 75 Years of Service and Diamond Years of Upholding Justice. The yearly celebration of the Government Corporations and OGCC Week continues to this day. On 1 December 2011, a Year-End Forum on Good Governance was organized with the newly appointed Chairman of the Governance Commission for GOCCs (GCG) Advocacy of Alternative Dispute Resolution
The OGCC has etched its mark in the major developments in government corporations. It has –
1. Successfully arbitrated a 10-Billion Peso dispute between the National Power Corporation and the PNOC-Energy Development Corporation; and,
2. Effectively conciliated controversies and differences between the Bases Conversion Development Authority and Land Bank of the Philippines on valuation of land; North Rail and National Food Authority on lease agreement for depot; Lung Center of the Philippines and National Kidney Transplant Institute on rights over real property.
What is more, the OGCC continues its active involvement in promoting Public-Private Sector Participation and Privatization of Government Corporations. It has thus –
1. Assisted in the drafting and caused the publication of the 2008 Guidelines on Joint Ventures between Government Corporations and the Private Sector issued by the National Economic Development Authority (NEDA) and Government Procurement Policy Board (GPPB), and drafted the proposed Joint Venture Guidelines for Local Governments;
2. Conducted close to 50 seminars on the new Joint Venture Guidelines before Government Corporations, the Securities and Exchange Commission and the private sector;
3. Extensively participated in the drafting of the transaction documents for the successful fourth round of bidding for the privatization by way of concession of the National Transmission Corporation and power generation plants by the Power Sector Assets and Liabilities Management (PSALM);
4. Participated in the privatization of PNOC-EC, and Mimosa Leisure Estates operated by Clark Development Corporation; and
5. Prepared and presented a paper on Public-Private Sector Participation on Water before all water districts.
Establishment of Good Corporate Governance in the Public Sector
The OGCC has also –
1. Forged close ties with the newly created Governance Commission for GOCCs (GCG);
2. Caused the preparation and publication of a Model Code of Corporate Governance for the Government Corporations;
3. Entered into a Partnership with the Department of Finance for the adoption of Model Code of Corporate Governance, Training and Monitoring Programs; and,
44. Reminded Government Corporations to adopt Quality Management System Standards, pursue good Corporate Governance practices, contribute to pro-poor programs of the National Government, and allocate surplus funds for rice and food production.
The OGCC Today
GCC Creencia’s first 100 days in office saw the unclogging of the gridlock that has hampered the efficient delivery of services. Led by his drive, and with purposeful efforts exerted by the men and women of the Office, a zero-backlog of opinion and contract reviews was achieved. In 2011, the OGCC achieved a much-improved compliance rating compared to 2009 and 2010.
GGuided by his ABC Formula – Able Lawyers, Better Service and Clearer Rules — GCC Creencia also undertook the following programs:
1. Codification of internal rules and regulations.
2. Launching of the 2011 OGCC Rules and Regulations.
3. Training and MCLE programs for lawyers.
4. MCLE lecture for lawyers.
5. Legal audit of the work being performed by the various legal departments of government corporations, and institutionalizing GC-OGCC partnership through well-defined memorandum of agreement.
6. Active participation in DOJ activities, such as: planning sessions, regular management committee meetings, office for competition, and efforts to revise the criminal code.
7. Closer coordination with clients and better working relations with the in-house lawyers of government corporations.
8. Strengthening the OGCC through the passage of a new and modern charter.
9. Rational sourcing and distribution of fees and assessments.
10. Improved compliance rating with the OGCC’s 28-day cycle for opinions and contract review.
Under the stewardship of GCC Creencia, the OGCC has resolved to evolve, and continues to lift its sights to greater heights, improve its work to higher standards, and push itself beyond its normal limitations.
Amid the reforms being initiated in the government corporate sector, the OGCC is ready to meet all new and unique challenges as the statutory counsel of all government corporations.