Quasi-Legislative or Rule-Making Power of Administrative Agencies

In the realm of administrative law, quasi-legislative or rule-making power is one of the essential functions exercised by administrative agencies. It refers to the authority delegated to administrative bodies by the legislature to create rules and regulations that have the force and effect of law.

Legal Basis and Delegation of Rule-Making Power

Under the Philippine Constitution, the legislative power is vested in Congress. However, administrative agencies are delegated quasi-legislative powers to fill in the details and implement the laws passed by Congress. The delegation of this rule-making power is founded on the principle that Congress cannot foresee every detailed situation that may arise and must rely on specialized administrative agencies to formulate specific rules to implement the law. This delegation of power is considered constitutional as long as it meets the following two requirements:

Completeness Test – The law must be complete in itself, setting forth the policy to be executed by the administrative agency.
Sufficient Standard Test – The law must provide adequate guidelines or standards that limit the agency's discretion in exercising its rule-making power.

Relevant case law:

Pelaez v. Auditor General, 15 SCRA 569 (1965) – The Supreme Court invalidated a delegation of legislative power that did not meet the requirements of completeness and adequate standards.
Abakada Guro Partylist v. Ermita, 469 SCRA 1 (2005) – Reiterated the importance of providing sufficient standards in the delegation of legislative power.

Nature and Characteristics of Quasi-Legislative Power

Delegated Power: The rule-making authority is always derived from a legislative act. Without a valid delegation of power, an administrative agency cannot issue any rules or regulations.
Subordinate Legislation: Rules and regulations issued by administrative agencies are subordinate to the statute they seek to implement. They must conform to the statute's purpose, intent, and language. If an agency oversteps its bounds or contradicts the law, its rules are deemed invalid.
Binding Effect: Administrative rules, when properly promulgated under the legislative delegation, have the force and effect of law. These rules bind both the public and the government in the same manner as statutory law.
Discretionary Power: The power to issue rules and regulations is a discretionary one. Courts will generally not interfere with an agency's discretion as long as the agency does not act beyond its authority or in a manner that is arbitrary or capricious.

Types of Rules Issued Under Quasi-Legislative Power

Substantive Rules: These are rules that affect the rights of individuals and have the force of law. They provide specific standards and obligations that the law itself may not cover in detail.
Interpretative Rules: These rules interpret the provisions of a law, providing the agency's understanding or explanation of ambiguous statutory provisions. While these do not have the same binding effect as substantive rules, they may be persuasive, especially if the agency has expertise in the subject matter.
Procedural Rules: These are rules that outline the processes and procedures that individuals and entities must follow in dealing with the administrative agency. Procedural rules must comply with the Administrative Code of 1987 or other relevant laws.

Rule-Making Process

The issuance of rules by an administrative agency typically follows a process set forth under the Administrative Code of 1987 or special statutes creating the agency. The process includes:

Notice: The public is generally entitled to notice of proposed rule-making. This is to ensure transparency and provide stakeholders the opportunity to participate.
Public Participation: Interested parties may submit their comments or attend hearings on the proposed rules. Public participation is essential in ensuring that the rules are fair, reasonable, and consistent with the law.
Publication: Once rules are finalized, they must be published in a manner prescribed by law. Publication is a condition for their enforceability. Under the Civil Code of the Philippines, laws (including administrative rules) take effect 15 days following their publication, unless otherwise specified.
Legislative Oversight: Congress may exercise its oversight function to review the rules issued by administrative agencies. It can revoke or amend the authority of the administrative agency if the rules are deemed inconsistent with legislative intent.

Limitations on Quasi-Legislative Power

Conformity to Law: Administrative agencies cannot issue rules that expand, modify, or amend the statute they are tasked to implement. The rules must conform to the law’s language, purpose, and scope. Any deviation from the law may render the rule invalid.
- People v. Maceren, 79 SCRA 450 (1977) – The Supreme Court struck down rules that went beyond the authority granted by the enabling statute.
Non-Delegation Doctrine: The power to make laws is inherently legislative and cannot be delegated to an administrative agency except through specific delegation. Therefore, the agency must strictly adhere to the scope of authority granted by the legislature.
Constitutional Limitations: Administrative rules must not violate constitutional provisions such as the due process clause, equal protection clause, or non-delegation of legislative power.
Judicial Review: Courts have the power to review the validity of administrative rules. A rule may be declared invalid if it is:
- Ultra vires (beyond the agency’s authority);
- Arbitrary or unreasonable;
- Inconsistent with the law it seeks to implement; or
- Violative of constitutional rights.
Case law:
- Central Bank of the Philippines v. CA, 139 SCRA 46 (1985) – The Supreme Court held that rules and regulations cannot modify or supplant the law they are supposed to implement.

Case Examples

Commissioner of Internal Revenue v. Fortune Tobacco Corp., 559 SCRA 160 (2008) – The Supreme Court held that the Commissioner of Internal Revenue cannot issue a revenue regulation that imposes additional tax not found in the Tax Code, as this would constitute an invalid exercise of legislative power.
Tatad v. Garcia, 243 SCRA 436 (1995) – The Court invalidated a DOTC administrative order that violated the principle of due process and overstepped the bounds of the enabling law.
Lina, Jr. v. Carino, 363 SCRA 183 (2001) – The Court struck down a rule promulgated by the Department of Agrarian Reform (DAR) that effectively amended the Comprehensive Agrarian Reform Law, emphasizing that an administrative agency's power is confined to implementing—not altering—the law.

Conclusion

The quasi-legislative or rule-making power of administrative agencies is a critical function that enables the detailed implementation of laws. While administrative agencies possess the expertise to craft specific regulations, their rule-making power is circumscribed by the limits set by Congress and the Constitution. Any rule promulgated must not only comply with the legislative intent but also respect constitutional principles and due process. This careful balance ensures that the quasi-legislative power remains a vital yet controlled aspect of governance in the Philippines.