The operative word (the verb) in the law is "to intervene".
The prohibition contemplated in Section 5 of R.A. NO. 3019 is when there is a contract between one person and the government, and a relative (son, spouse, daughter, etc) of the President, vice president, Senate President, House Speaker, intervenes in that particular contract, transaction of application.
This is my impression based on the decision of the Supreme Court in E. Razon, Inc. versus Philippine Ports Authority (151 SCRA 233) June 22, 1987.
If you would notice in that decision, the contract was nullified because Alfredo Bejo Romualdez was related to the then First Lady Imelda Marcos.
But Romualdez was not a party to the contract. The parties to the contract were E. Razon Inc. represented by its President Enrique Razon and the Philippine Ports Authority represented by general manager E.S. Baclig.
It was Romualdez' indirect intervenion, i.e. by acquiring the controlling shares of E. Razon Inc. that placed him under the coverage of Section 5.
In the case of Joey De Venecia and AHI Holdings Inc., it was Joey himself, in behalf of his own company who was trying to apply for a BOT arrangement with the government (DOTC).
Joey was not intervening for a different person, who was applying for a contract with the government.
It can be argued that the word "intervene" includes intervening as a party to the contract itself, not just intervention in behalf of another person who is a party to the government contract.
I can't agree with this argument because it would unduly deprive relatives of top government officials from entering into any contract with the government.
Are relatives prohibited from entering intro contracts with the government?
The answer is No.
What is the basis?
Section 5 itself. Look at the lower portion of the provision:
In the case of Joey De Venecia and AHI Holdings Inc., it was Joey himself, in behalf of his own company who was trying to apply for a BOT arrangement with the government (DOTC).
Joey was not intervening for a different person, who was applying for a contract with the government.
It can be argued that the word "intervene" includes intervening as a party to the contract itself, not just intervention in behalf of another person who is a party to the government contract.
I can't agree with this argument because it would unduly deprive relatives of top government officials from entering into any contract with the government.
Are relatives prohibited from entering intro contracts with the government?
The answer is No.
What is the basis?
Section 5 itself. Look at the lower portion of the provision:
"Provided, that this section shall not apply to any person who, prior to the assumption of office of any of the above officials to whom he is related, has been already dealing with the government along the same line of business, nor to any transaction, contract or application already existing or pending at the time of such of such assumption of public office, nor to any application filed by him the approval of which is not discretionary on the part of the official or officials concerned but depends upon compliance with requisites provided by law, or rules or regulations issued pursuant to law, nor to any act lawfuly performed in an official capacity or in the exercise of a profession."
If Joey De Venecia was already dealing with the government in the same line of business prior to the assumption of his father as Speaker, then Section 5 does not apply to him.
If the application by Joey De Venecia was one the approval of which is not discretionary on the part of the Speaker but depends upon compliance with requisites provided by law then Section 5 does not apply to Joey De Venecia.
If Joey's application with the government was in the exercise of his profession, then Section 5 does not apply.
I want to emphasize that just because one is a son or daughter of a top government official, his or her rights are diminished, that, for example, he or she can no longer contract with the government, or he or she can no longer run for public office, etc.That would be a violation of a basic human right. That principle would be discriminatory against certain persons by accident of birth.
What Section 5 prohibits is the possible or probably undue advantage (due to influence) that may arise due to filial relations with powerful government officials.
However, under any circumsntance, prudence, decency and delicadeza dictate that realtives of high government officials refrain from taking part in contracts with the government.
That is why, if I recall rightly, when President Estrada and President Arroyo, and President Aquino (I believe) assumed the presidency, one of their first official acts (whether sincere or not) was to issue a memorandum barring relatives from entering into contracts with the government.
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