This document discusses government-owned and controlled corporations (GOCCs) in the Philippines. It provides background on GOCCs, including that there are currently 158 GOCCs established either through special charter or registration. The GOCC Governance Act of 2011 created the Governance Commission for GOCCs to provide central oversight and rationalize the GOCC sector through reorganization, merger, streamlining, abolition or privatization of GOCCs. The Act also implemented new disclosure, audit, and compensation requirements to improve governance and performance of GOCCs.

1. Government Owned &
Controlled Corporation
Presented by:
PSI HERMAN LUMANOG,MMPA
Doctor of Public Management
Pamantasan ng Lungsod ng Manila

2. Presidential Decree No. 2029
A stock or a non-stock corporation
whether performing governmental or
proprietary
functions,
which
is
directly chartered by a special law or,
if organized under the general
corporation
law,
is
owned
or
controlled by the government directly
or
indirectly
through
a
parent
corporation
or
a
subsidiary
corporation.

3. Presently 158 GOCC
• 84 Chartered
• 74 registered under the SEC
Owned and controlled by the state
supposed to address market failures
and correct imperfections.

4. Executive Order No. 64 of
1993
A corporation created by special law
or incorporated and organized under
the Corporation Code and in which
government, directly or indirectly, has
ownership of the majority of the
capital stock.

5. Why GOCC are created? And
Why?
 Grounded on the idea that market
failures do exist and government needs
to intervene to protect public interest.
 The use of corporate vehicle recognized
as
efficient
means
to
mobilized
government assets.

6. History of GOCC in the
Philippines
Mid 50’s and early 60’s GOCC
disastrous financial performance
37 GOCC in 1965
During president Marcos first 10 years,
GOCC reach up to 120 in 1975
303 GOCC in 1984
And in 2010 there is 604 GOCC’s in
which 446 are operational water
districts.

7. There is no central agency tasked to
monitor and supervise the activities
of the government corporate sector or
the GOCC’s

8.  Executive Order No. 936
• Creation of GCMC ( Government
Corporate Monitoring Committee.)
 Presidential Proclamation
No. 50
• Authorized the privatization of
GOCC’s
• (that resulted to only 158 GOCC’s today.)

9. Conditions in where GOCC
operate
In cases where private sector is
unwilling or unable to provide goods
and services vital to the society such
construction of large infrastructure
i.e. roads & ports;
 When there is a need to create bias
in favor of disadvantage sector of the
society in a free market such as
distribution of staples and sugar;

10. To spur the development of strategic
activities with wide ranging economic
impact; and
When there exist natural monopolies
which government want to control to
protect the consuming public.

11. Groups of GOCC
Cluster A - Financial institutions
Cluster B - Public Utilities, Industrial,
area development, agricultural,
trading, promotional
Cluster C – Social, Cultural and
Scientific

12. How do GOCC’s performance
impact the government
 Section 3 of R.A. 7656 require all GOCC to
remit 50% of annual net earning in cash,
stock or property dividends to national
government.
 35.7 billion collected from GOCC in 2009 or 25.3% of
total non-tax revenue
 GOCC’s constitutes expenditures, they
deemed to be entitled to financial support in
form of subsidies, equity infusion & lending.
 23.8 billion of financial aid or 1.7% in government
budget in 2009.

13. Al-Amanah Islamic Investment Bank of the Philippines
(ISLAMIC BANK)
Bangko Sentral ng Pilipinas (BSP)
Bases Conversion Development Authority (BCDA)
Cebu Ports Authority (CPA)
Clark Development Corporation (CDC)
Cottage Industry Technology Center (CITC)
Center for International Trade Expositions and Missions
(CITEM)
Cultural Center of the Philippines (CCP)
Development Academy of the Philippines (DAP)
Development Bank of the Philippines (DBP)
DBP Data Center, Inc. (DCI)
Duty Free Philippines
Employees' Compensation Commission (ECC)
Food Terminal Incorporated (FTI)
Fiber Industry Development Authority (FIDA)
Government Service Insurance System (GSIS)
Home Development Mutual Fund (Pag-IBIG)
Home Guaranty Corporation (HGC)
John Hay-Poro Point Development Corporation
Integrated Bar of the Philippines (IBP)
Instructional Materials Corporation (IMC)
Laguna Lake Development Authority (LLDA)
Land Bank of the Philippines (LBP)
Light Rail Transit Autority (LTRA)
Livelihood Corporation (LIVECOR)
Local Water Utilities Administration (LWUA)
Lung Center of the Philippines (LCP)
Mactan-Cebu International Airport Authority (MCIAA)
Manila International Airport Authority (MIAA)
Masaganang Sakahan, Inc.
Metropolitan Waterworks and Sewerage System (MWSS)
Metro Manila Transit Corporation (MMTC)
National Agribusiness Corporation (NABC)
National Dairy Authority (NDA)
National Development Company (NDC)
NDC Maritime Leasing Corporation (NLMC)
National Electrification Administration (NEA)
National Food Authority (NFA)
National Home Mortgage Finance Corporation (NHMFC)
National Housing Authority (NHA)
National Irrigation Administration (NIA)
National Livelihood Support Fund (NLSF)
National Kidney and Transplant Institute (NKTI)
National Power Corporation (NAPOCOR)
National Tobacco Administration (NTA)
National Transmission Corporation (TRANSCO)
North Luzon Railways Corporation (NorthRail)
Northern Foods Corporation (NFC)

14. Natural Resources Development Corporation (NRDC)
Occupational Safety and Health Center (OSHC)
Overseas Workers Welfare Administration (OWWA)
People's Credit and Finance Corporation (PCFC)
PEA Tollway Corporation (PEATC)
Philippine Aerospace Development Corporation (PADC)
Philippine Amusement and Gaming Corporation
(PAGCOR)
Philippine Center for Economic Development (PCED)
Philippine Charity Sweepstakes Office (PCSO)
Philippine Coconut Authority (PCA)
Philippine Convention and Visitors Corporation (PCVC)
Philippine Crop Insurance Corporation (PCIC)
Philippine Deposit Insurance Corporation (PDIC)
Philippine Economic Zone Authority (PEZA)
Philippine Export-Import Credit Agency (PHILEXIM)
Philippine Health Insurance Corporation (PHILHEALTH)
Philippine Heart Center (PHC)
Philippine International Convention Center (PICC)
Philippine International Trading Corporation (PITC)
Philippine Institute for Development Studies (PIDS)
Philippine Institute of Traditional and Alternative Health
Care (PITAHC)
Philippine National Oil Company (PNOC)
PNOC Alternative Fuels Corporation (PNOC AFC)
PNOC Energy Development Corporation (PNOC EDC)
PNOC Exploration Corporation (PNOC EC)
PNOC Development and Management Corporation
(PDMC)
PNOC PNOC Shipping and Transport Corporation
(PNOC STC)
Philippine National Railways (PNR)
Philippine Ports Authority (PPA)
Philippine Postal Corporation (PHILPOST)
Philippine Postal Savings Bank, Inc. (PPSB)
Philippine Retirement Authority (PRA)
Philippine Reclamation Authority (formerly Philippine
Estates Authority)
Philippine Rice Research Institute (PRRI)
Poro Point Management Corporation (PPMC)
Power Sector Assets and Liabilities Management
Corporation (PSALM)
Philippine Tourism Authority (PTrA)
Quedan Rural Credit and Guarantee Corporation
(QUEDANCOR)
Radio Philippine Network, Inc. (RPN)
Small Business Guarantee and Finance Corporation
(SBGFC)
Social Housing Finance Corporation (SHFC)
Social Security System (SSS)
Subic Bay Metropolitan Authority (SBMA)
Sugar Regulatory Administration (SRA)
Technology and Livelihood Resource Center (TLRC)
Trade and Investment Development Corporation of the
Philippines (TIDCORP)
Zamboanga City Special Economic Zone Authority
(Zamboanga Freeport Authority)

15. GOCC Governance Act of 2011
(Republic Act No. 10149)
Consolidation of Senate Bill no. 2640
& House Bill No. 4067
Central advisory, monitoring and
oversight body with authority to
formulate, implement and coordinate
policies concerning GOCC’s and
related corporation.

16. GCG powers & function
Evaluate the performance &
determine the relevance of the GOCC,
to ascertain whether such GOCC
should be organized, merged ,
streamlined, abolished, or privatized.
Classification of GOCCs
Filing criminal & administrative
charges of its directors/employees
Conduct periodic study, examination,
evaluation & assessment of
performance of GOCCs.

17. Review function of each the GOCC
and, upon determination that there is
conflict between regulatory and
commercial functions of a GOCC
Prepare semi-annual progress report
to be submitted to the President &
Congress.

18. RATIONALIZING THE GOCC
SECTOR
 The GCG has the power and
function to ascertain whether a
GOCC should be:
- Reorganized;
- Merged;
- Streamlined;
- Abolished; or
- Privatized

19. GCG composition
The GCG is composed of 5 members.
The chairman with the rank of Cabinet
Secretary and two members with the
rank of under secretary shall be
appointed by the president
The secretaries of the Dept. of Budget
& Management and Department of
Finance shall act as ex officio
members.

20. Disclosure & audit requirements
R.A. 10149 require full disclosure of all
GOCC through a website and grant
unrestricted public access
Latest annual audited financial report
within 30 days from receipt
Audited
financial
statements
in
immediate 5 years
Quarterly, annual report & trial
balance
Current corporate operating budget

21. Complete compensation package of
all board members & officers
 Travel
 Representation
 Transportation and any form of allowances or
expenses.
Local & foreign borrowings
Performance scorecards & strategy maps
Government subsidiary & net lending
All borrowing guaranteed by the
government
• All information GCG requires
•
•
•
•

22. Exempted of the coverage of R.A.
10149
Bangko Sentral ng Pilipinas
State Universities & Colleges
Cooperatives
Local water districts
Economic zone authorities
Research institution

23. Directors/Trustees/Employe
es
Compensation and Position
classification system for GOCC
officers & employees
 Subject to Phil president approval
Additional incentives
 No incentives shall be granted unless GOCC
has fully paid taxes for which its liable
Position, Titles and Salary Grade

24. Directors/ Trustees appointment
& term of office
The appointive director shall be
appointed by the President of the
Philippines
 Shall meet the fit & proper rule according to
GCG
Term of office of appointed director
shall be 1 year (unless sooner remove
for a cause)
Limit to compensation, per diems,
Allowances and incentives

25. CONCLUSION
The GOCC act of 2011 establishes the
framework for reforms in the public
corporate sector. It is designed to
reform the government corporate
sector, improve corporate governance
of GOCCs, and exact from them
efficient and effective public service.