Sec. 13. The President, Vice-President, the Members of the Cabinet, and their deputies or assistants shall not, unless otherwise provided in this Constitution, hold any other office or employment during their tenure. They shall not, during said tenure, directly or indirectly, practice any other profession, participate in any business, or be financially interested in any contract with, or in any franchise, or special privilege granted by the Government or any subdivision, agency, or instrumentality thereof, including government-owned or controlled corporations or their subsidiaries. They shall strictly avoid conflict of interest in the conduct of their office.

The spouse and relatives by consanguinity or affinity within the fourth civil degree of the President shall not during his tenure be appointed as members of the Constitutional Commissions, or the Office of the Ombudsman, or as Secretaries, Undersecretaries, chairmen or heads of bureaus or offices, including government-owned or controlled corporations and their subsidiaries. (Art. VII, 1987 Constitution)

Facts: 

Petitioner National Amnesty Commission (NAC) is a government agency created in 1994 by then President Fidel V. Ramos through Proclamation No. 347. The NAC is tasked to receive, process and review amnesty applications. It is composed of 7 members: a Chairperson, three regular members appointed by the President, and the Secretaries of Justice, National Defense and Interior and Local Government as ex officio members.

After personally attending the initial NAC meetings, the three ex officio members turned over said responsibility to their representatives who were paid honoraria. However, in 1997, NAC resident auditor Eulalia disallowed on audit the payment of honoraria to these representatives pursuant to COA Memorandum No. 97-038.

Meanwhile, in 1999, the NAC passed Administrative Order No. 2 (the new Implementing Rules and Regulations of Proclamation No. 347), which was approved by then President Joseph Estrada. Section 1, Rule II thereof provides that ex officio members may designate their representatives to the Commission. Said Representatives shall be entitled to per diems, allowances, bonuses and other benefits as may be authorized by law.

Petitioner invoked Administrative Order No. 2 in assailing before the COA the rulings of the resident auditor and the National Government Audit Office disallowing payment of honoraria to the ex officio members' representatives, to no avail.


Issues:

1. Whether or not COA committed grave abuse of discretion in implementing COA Memorandum No. 97-038 without the required notice and publication under Article 2 of the Civil Code

2. Whether or not COA committed grave abuse of discretion  disallowing the payment of honoraria on the ground of lack of authority of representatives to attend the NAC meetings in behalf of the ex officio members

3. Are the representatives de facto officers and as such are entitled to allowances?


Held:

1. No.  COA Memorandum No. 97-038 does not need, for validity and effectivity, the publication required by Article 2 of the Civil Code:
Art. 2. Laws shall take effect after fifteen days following the completion of their publication in the Official Gazette, unless it is otherwise provided. This Code shall take effect one year after such publication.
We clarified this publication requirement in Taada vs. Tuvera:

[A]ll statutes, including those of local application and private laws, shall be published as a condition for their effectivity, which shall begin fifteen days after publication unless a different effectivity date is fixed by the legislature.

Covered by this rule are presidential decrees and executive orders promulgated by the President in the exercise of legislative powers whenever the same are validly delegated by the legislature or, at present, directly conferred by the Constitution. Administrative rules and regulations must also be published if their purpose is to enforce or implement existing law pursuant to a valid delegation.

Interpretative regulations and those merely internal in nature, that is, regulating only the personnel of the administrative agency and not the public, need not be published. Neither is publication required of the so-called letters of instructions issued by administrative superiors concerning the rules or guidelines to be followed by their subordinates in the performance of their duties.

COA Memorandum No. 97-038 is merely an internal and interpretative regulation or letter of instruction which does not need publication to be effective and valid. It is not an implementing rule or regulation of a statute but a directive issued by the COA to its auditors to enforce the self-executing prohibition imposed by Section 13, Article VII of the Constitution on the President and his official family, their deputies and assistants, or their representatives from holding multiple offices and receiving double compensation.


2. No. The COA is correct that there is no legal basis to grant per diem, honoraria or any allowance whatsoever to the NAC ex officio members' official representatives.

The representatives in fact assumed their responsibilities not by virtue of a new appointment but by mere designation from the ex officio members who were themselves also designated as such.

There is a considerable difference between an appointment and designation. An appointment is the selection by the proper authority of an individual who is to exercise the powers and functions of a given office; a designation merely connotes an imposition of additional duties, usually by law, upon a person already in the public service by virtue of an earlier appointment.

Designation does not entail payment of additional benefits or grant upon the person so designated the right to claim the salary attached to the position. Without an appointment, a designation does not entitle the officer to receive the salary of the position. The legal basis of an employee's right to claim the salary attached thereto is a duly issued and approved appointment to the position, and not a mere designation.

In Civil Liberties Union, we held that cabinet secretaries, including their deputies and assistants, who hold positions in ex officio capacities, are proscribed from receiving additional compensation because their services are already paid for and covered by the compensation attached to their principal offices. Thus, in the attendance of the NAC meetings, the ex officio members were not entitled to, and were in fact prohibited from, collecting extra compensation, whether it was called per diem, honorarium, allowance or some other euphemism. Such additional compensation is prohibited by the Constitution.

Furthermore, in de la Cruz vs. COA and Bitonio vs. COA, we upheld COA's disallowance of the payment of honoraria and per diems to the officers concerned who sat as ex officio members or alternates. The agent, alternate or representative cannot have a better right than his principal, the ex officio member. The laws, rules, prohibitions or restrictions that cover the ex officio member apply with equal force to his representative. In short, since the ex officio member is prohibited from receiving additional compensation for a position held in an ex officio capacity, so is his representative likewise restricted.


3.  No. The representatives cannot be considered de facto officers because they were not appointed but were merely designated to act as such. Furthermore, they are not entitled to something their own principals are prohibited from receiving. (National Amnesty Commission vs. COA, G. R. No. 156982, September 8, 2004)