Practice question
After RA 11659 took effect, a foreign state-owned enterprise proposes to acquire 10% of a Philippine electricity-distribution utility. It is an ordinary commercial state enterprise, not a qualifying sovereign wealth or independent pension fund. It argues that the acquisition is allowed because it is below 30%. Which analysis is correct?
- The argument fails; the 30% provision concerns specified funds and is not a general allowance for every state enterprise.
- The argument succeeds because every foreign state enterprise has a 30% allowance.
- The argument succeeds because a minority stake can never be restricted.
- The argument succeeds because electricity distribution is outside the public-utility category.
- The argument fails only if the enterprise purchases more than 50%.
Legal references
- RA 11659, Sections 2(g) and 24; https://lawphil.net/statutes/repacts/ra2022/ra_11659_2022.html
- 2023 IRR of RA 11659, Section 44; https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/2/97017
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