UCPB on ‘coco shares’
This refers to the editorial “A long, unjust wait” and Raul Palabrica’s “Resolution of commercial cases.” Coming out in the Inquirer’s Sept. 21 issue, both focused on the recent Supreme Court decision denying UCPB’s petition for declaratory relief—or request for a legal clarification—on the bank’s rights over shares of stock of the CIIF oil mills. The stocks are covered by duly issued, recorded and recognized stock certificates.
Like the Inquirer, UCPB is sympathetic to and is fully supportive of our coconut farmers’ long and arduous quest to benefit from the coco levy. However, we would like to correct several errors in both opinion pieces.
For one, it is wrong to say that the bank’s action for declaratory relief is a legal impediment to that quest, or has held in abeyance the Supreme Court ruling. The implementation of the 2012 decision is undergoing execution proceedings before the Sandiganbayan, and is unaffected by the action for declaratory relief.
Also, UCPB was not a party to the case to recover the coco levy funds and assets. We believe we can all agree on the syllogism that underpins the ruling of the Sandiganbayan and Supreme Court decisions:
1) The coco levy funds are public funds. (2) If these were used to acquire assets, then (3) all assets acquired using coco levy funds are public funds.
It is therefore wrong to say that the assets acquired with private funds are covered by the Sandiganbayan and Supreme Court decisions. UCPB’s present legal action seeks clarification precisely on this point. We beg your indulgence, however, as we cannot be more specific on our facts and arguments because this issue is still sub judice. It is nevertheless important to note that:
- We are NOT after any share of the coco levy funds. As administrator of a part of the coco levy, the bank grew the funds from P2.57 billion in 1977 to P65.48 billion by end-2014. In fact, in compliance with the same high court decision, the coco levy funds, already amounting to P70 billion, were remitted in two tranches in October 2012 and June 2015 to the Bureau of Treasury—for safekeeping.
- However, it behooves us as a financial banking institution to protect the bank and its corporate assets as we have a fiduciary duty to our shareholders who, after all, includes the coconut farmers and the government. That’s why we are exhausting all possible legal remedies to reiterate our position: while it is correct that the bank, in its role as administrator, invested coco levy funds to acquire a controlling interest in the oil mills and SMC shares, it also invested its own corporate funds to acquire minority interest in the same oil mills and SMC shares. Unfortunately, our proprietary share was overlooked and lumped together with the sequestered shares, thus mistakenly considered government-owned.
Apart from this very basic duty and right as a corporate entity, we have no other contention. We only seek to humbly appeal to the judiciary to clarify its ruling through the legal remedies that we plan to pursue. As a government-controlled bank since 1986, the bank has not made, and will not make, any decision or take any action inconsistent with the interest of the coconut farmers and the public in general.
—R. VELASCO, senior corporate communication officer, Corporate Communication Unit, UCPB
