Dennis Funa vs Manila Economic and Cultural Office

G.R. No. 193462 – 726 Phil. 63 – 715 SCRA 247 – Political Law – Constitutional Law – State Immunity From Suit – Government Instrumentality – MECO is not a GOCC; MECO is not a government instrumentality

In 2010, Atty. Dennis Funa, as a concerned citizen, requested the Commission on Audit (COA) that he be given financial and audit report pertaining to the Manila Economic and Cultural Office (MECO). There it was found out that the COA was not actually auditing MECO. As a result, Atty. Funa filed a mandamus case to compel the COA to audit MECO and for the MECO, as a government owned and controlled corporation (GOCC) or at least a government instrumentality, to submit itself to a COA audit.

MECO opposed the petition on the ground that it is not subject to a government audit because it is not a government owned corporation nor is it a government instrumentality.

ISSUES:

Is MECO a GOCC?

Is MECO a government instrumentality?

Is MECO subject to COA audit?

HELD:

1. No. MECO is not a GOCC. It is not owned by the government. MECO is a non-stock corporation organized under the Corporation Code. MECO is the corporate entity “entrusted” by the Philippine government with the responsibility of fostering “friendly” and “unofficial” relations with the people of Taiwan, particularly in the areas of trade, economic cooperation, investment, cultural, scientific and educational exchanges without violating the One China Policy.

2. No. MECO is not a government instrumentality. Government instrumentalities are either regulatory agencies, chartered institutions, or government corporate entities or government instrumentalities with corporate powers, which are all, by explicit or implicit definition, creatures of the MECO are neither any of those enumerated.

So what then is the MECO?

It is a Sui Generis Entity. The MECO is uniquely situated as compared with other private corporations. From its over-reaching corporate objectives, its special duty and authority to exercise certain consular functions, up to the oversight by the executive department over its operations—all the while maintaining its legal status as a non-governmental entity—the MECO is, for all intents and purposes, sui generis.

3. Yes but only insofar as the verification fees that it is collecting for DOLE. The “verification fees” mentioned here refers to the “service fee for the verification of overseas employment contracts, recruitment agreement or special powers of attorney” that the DOLE was authorized to collect. Since the DOLE cannot collect those from Taiwanese employers, it has an agreement with the MECO to be its collecting agent. Since the collection pertains to the government, it is subject to COA audit.

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