Mindanao Railways Development Act

Seas Office of the Suer tary TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES FEB 25 A10 :26 First Regular Session SENATE RECEIVED BY: S. No. 1903 Introduced by Senator JV Ejercito AN ACT CREATING THE MINDANAO RAILWAYS AUTHORITY (MRA), PRESCRIBING ITS POWERS, FUNCTIONS AND DUTIES, AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 4156 ENTITLED "AN ACT CREATING THE PHILIPPINE NATIONAL RAILWAYS, PRESCRIBING ITS POWERS, FUNCTIONS AND FUNDS FOR ITS DUTIES, AND PROVIDING FOR THE NECESSARY OPERATION" AS AMENDED BY R. A. NO. 6366, APPROPRIATING FUNDS THEREFOR, AND FOR OTHER PURPOSES EXPLANATORY NOTE As recorded by the Philippine Statistics Authority, the 2024 Census of Population calculated that the country's population reached 112.7 million as of July 20241. Vehicle sales in 2025 reached selling 491,395 units, an increase of 3.7% compared to the 2024 data from the Chamber of Automotive Manufacturers of the Philippines. Inc. (Campi)?. Urban populations in the Philippines have grown rapidly, increasing the demand for mobility, while transport development has lagged due to underinvestment. 3 As a result, transportation networks are heavily congested, prompting the government to encourage citizens to rely more on public transportation than private vehicles. Among 1 2024 Census of Population (POPCEN) Population counts declared official by the President / Philippine Statistics Authority / Republic of the Philippines. (2025). https://psa.gov.ph/content/2024-census-population-popcen- population-counts-declared-official-president 2 Zapanta, L. K. M. (2026, January 27). Philippine car sales hit new record in 2025. INQUIRER.net. https://business.inquirer.net/570580/ph-car-sales-hit-new-record-in-2025 3 Ramos, J. (2023, December 6). Are we creating safe and inclusive mass transportation? - https://cbills.dap.edu.ph/2023/12/05/are-we-creating-safe-and-inclusive-mass-transportation/

public transport options, rail transport is considered one of the fastest, most efficient, and reliable modes of land transportation. A comprehensive railway system can provide numerous benefits, including economic growth, the creation of better job opportunities through improved regional connectivity, and an enhanced quality of life for Filipinos.* The lack of transport options in rural areas remains a barrier to accessibility and social inclusion. Considering that the Mindanao region plays a crucial role in the country's food security and exports, the development of an efficient railway system is essential to boost productivity, strengthen regional connectivity, and support national development». In this proposed measure, the Mindanao Railway Authority will be created, attached to the Department of Transportation, in order to oversee the construction, operation, and maintenance of railways in Mindanao. The Authority will manage PNR assets in Mindanao, operate railroads, tramways, vessels, and pipelines for passenger and cargo transport, and, as an auxiliary function, operate powerhouses, hotels, terminals, and warehouses; manufacture rolling stock and equipment; and construct toll viaducts and tunnels connected to its railway network. In light of the foregoing, the immediate passage of this legislation is earnestly sought. JV EJERCITO 4 Mira, R. P. (2025). Full Speed Ahead: Revitalizing the Philippine Rail Transport System. In Congressional Policy and Budget Research Department House of Representatives (CPBRD) Discussion Paper (No. DP2025-06). Retrieved February 18, 2026, from https://cpbrd.congress.gov.ph/wp-content/uploads/2025/02/DP2025-06- FULL-SPEED-AHEAD-REVITALIZING-THE-PHILIPPINE-RAIL-TRANSPORT-SYSTEM.pdf 5 Francisquete, D. E. M. (2025, November 3). Mindanao: PH's next economic frontier driven by agribusiness, peace. SunStar Publishing Inc. https://www.sunstar.com.ph/davao/mindanao-phs-next-economic-frontier-driven-by- agribusiness-peace

Sociali Office of the do Forg TWENTIETH CONGRESS OF THE ) REPUBLIC OF THE PHILIPPINES ) FEB 25 A10:26 First Regular Session ) SENATE RECEIVED BY S. No. 1903 Introduced by Senator IV Ejercito CREATING THE MINDANAO RAILWAYS AUTHORITY (MRA), PRESCRIBING ITS POWERS, FUNCTIONS AND DUTIES, AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 4156 ENTITLED "AN ACT CREATING THE PHILIPPINE NATIONAL RAILWAYS, PRESCRIBING ITS POWERS, FUNCTIONS AND DUTIES, AND PROVIDING FOR THE NECESSARY FUNDS FOR ITS OPERATION" AS AMENDED BY R. A. NO. 6366, APPROPRIATING FUNDS THEREFOR, AND FOR OTHER PURPOSES Be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled: CHAPTER I TITLE, POLICY AND OBJECTIVES

SECTION 1. Short Title. - This Act shall be known as the "Mindanao Railways

4 Development Act".

Sec. 2. Declaration of Policy. - It is hereby declared the policy of the State

to attain inclusive growth and reduce poverty through infrastructure development aiming to improve the sectoral performance of tourism, agriculture and industries; improve goods and services; improve the quality of the environment; and increase resilience to climate change and natural disasters, through the establishment of a sustainable transport system that is safe, efficient, and competitive. Further, in order to promote comprehensive rural development and assure the 12 human right to travel in Mindanao, the State shall (1) create a national government 13 agency to achieve its development goals; and (2) provide appropriations for the

1 construction, operation and maintenance of the railways system and the operative 2 budget of the national government agency to be created under this Act.

Sec. 3. Creation and Objectives. - There shall be created the Mindanao

4 Railways Authority (MRA), hereinafter called the Authority, which is a national government agency attached to the Department of Transportation (DOTr), with the following immediate objectives: a. To provide for the railways system in Mindanao connecting as vast an area as deemed feasible in consideration of the Mindanao Railways Project (MRP) as mandated under the Philippine National Railways Charter or Republic Act No. 4156, and, the MRP Feasibility Study as an undertaking of the National Economic and Development Authority (NEDA) as Executing Agency and the Department of Transportation as Implementing Agency and funded under the General Appropriations Act; b. To initiate the provisions of R. A. No. 10752 or An Act Facilitating The Acquisition Of Right-Of-Way Site Or Location For National Government Infrastructure Projects upon effectivity of this Act; and c. To call upon all concerned National Government Agencies and Local Government Units to render technical and administrative support for the implementation of the provisions of this Act. CHAPTER II NATURE, SPECIFIC AND GENERAL POWERS

Sec. 4. Name and Domicile. - To carry out the foregoing transportation

policy, the Authority, shall be primarily responsible for the construction, operation and maintenance of a railways transportation system in Mindanao. It shall have its main office in the City of Davao.

Sec. 5. Purposes and Specific Powers. - The Authority shall have the

following purposes and specific powers: a. To hold the assets of the Philippine National Railways, and to succeed to, or acquire, maintain and operate such grants, concessions and franchises as are now held and enjoyed by the PNR but limited only to those located in Mindanao among the aforementioned;

b. To own or operate railroads, tramways, and other kinds of land transportation, vessels and pipelines, for the purpose of transporting, for consideration, passengers, goods, mail and property between any points in Mindanao; and c. As an auxiliary to its main purpose, to own and/or operate powerhouses, hotels, restaurants, terminals and warehouses; to manufacture rolling stock, equipment, tools and other appliances; and, to construct and operate toll viaducts and toll tunnels, in connection with its railroad lines.

Sec. 6. General Powers. - The Authority shall have the following general

powers: a. To have continuous succession under its corporate name, until otherwise provided by law; b. To prescribe, amend, and/or repeal its by-laws; c. To adopt and use a seal and alter it at its pleasure; d. To sue and be sued; e. To contract any obligation or enter into, assign or accept the assignment of, and vary or rescind any agreement, contract or obligation necessary or incidental to the proper management of the Authority; f. To borrow funds from any source, private or public, foreign or domestic, and to issue bonds and other evidence of indebtedness, the payment of which shall be guaranteed by the National Government, subject to pertinent borrowing laws; g. To acquire, receive, take and hold by bequest, devise, gift, purchase or lease, either absolutely or in trust for any of its purposes, from foreign and domestic sources, any assets, grant or property, real or personal, subject to such limitations as are provided in existing laws; to convey or dispose of such assets, grants, or properties, movable and immovable; and invest and/or reinvest such proceeds and deal with and expand its assets and income in such a manner as will best promote its objectives h. To improve, develop or alter any property held by it; i. To carry on any business, either alone or in partnership with any other person or persons;

j. To employ an agent or contractor or perform such things as the Authority may perform; k. To exercise the right of eminent domain, whenever the Authority deems it necessary for the attainment of its objectives; I. To prescribe rules and regulations in the conduct of its general business as well as to fix and implement the terms and conditions of its related activities; m. To determine the fares payable by persons travelling on the rail system, in consultation with the Department of Transportation and the NEDA; n. To establish, operate, and maintain branches or field offices when required by the exigencies of its business; o. To determine its organizational structure and the number, positions and salaries of its personnel, subject to pertinent organization and compensation law; and p. To exercise such powers and perform such duties as may be necessary to carry out the business and purposes for which the Authority was established or which, from time to time, may be declared by the Board of Directors to be necessary, useful, incidental or auxiliary to accomplish such purposes; and generally, to exercise all powers of any Authority under the Corporation Code that are not inconsistent with the provisions of this Act, or with orders pertaining to government corporate budgeting, organization, borrowing, or compensation. CHAPTER III THE MRA BOARD OF DIRECTORS

Sec. 7. The MRA Board of Directors. - To carry out the purposes of this

Act, the Authority shall be directed and controlled by a Board of Directors. It shall be composed of the following members: a. Secretary of Transportation, as Chairperson; b. MRA Administrator, as Vice-Chairperson; C. Secretary of Finance; d. Secretary of Economic Planning, Director General of the NEDA; e. Secretary of Public Works and Highways; and

f. Two representatives from the private sector who shall each be selected from the members of the Philippine Institute of Civil Engineers (PICE) and the Philippine Society of Mechanical Engineers (PSME), to be appointed by the President of the Philippines who shall select from three (3) nominees submitted separately by the PICE and PSME. They shall serve a non- extendible single term of three (3) years. The government representatives in the Board may designate their respective permanent alternates who shall be officials next-in-rank to them and their acts shall be considered the acts of their principals. In the absence of the Chairman, the Board shall elect a temporary presiding officer.

Sec. 8. Per Diem. - The members of the Board shall not receive any

compensation but shall be provided with per diem at rates allowed under existing rules and regulations.

Sec. 9. Powers and Duties of the Board of Directors. - The Board of

Directors shall have the following powers and duties: a. To prescribe, amend and repeal, with the recommendation of the Administrator, the by-laws, rules and regulations governing the manner in which the general business of the Authority may be exercised, including provisions for the formation of such committee, or committees as the Board of Directors may deem necessary to facilitate its business; b. To appoint and fix the compensation of the Administrator and of the other officers of the Authority, with the approval of the President. The Board by a majority vote of all the members, may, for cause, and with the approval of the President of the Philippines, suspend and or remove the Administrator; and c. To approve the annual and such supplemental budgets of the Authority which may be submitted to it by the Administrator from time to time.

Sec. 10. Suspension and Removal of Directors. - Any member of the

Board of Directors may be suspended or removed by the President of the Philippines.

Sec. 11. Prohibition for Board Members. - No chairman or member of the

Board of Directors shall at the same time serve in the Authority in any capacity

whatsoever other than as Chairman or member thereof, unless otherwise authorized by the President of the Philippines or any existing law. CHAPTER IV THE ADMINISTRATOR

Sec. 12. The Administrator. - The management of the Authority shall be

vested in the Administrator.

Sec. 13. Powers and Duties of the Administrator. - The Administrator

shall have the following powers and duties: a. To direct and manage the affairs and business of the Authority on behalf of the Board of Directors, and subject to its control and supervision; b. To sit in all meetings of the Board of Directors, as Vice-Chairman, and participate in its deliberation, with the right to vote, and to preside in meetings for or in the absence of the Chairman; c. To submit within sixty days after the close of each fiscal year an annual report, through the Board of Directors, to the Office of the President of the Philippines and the Congress of the Philippines; d. To appoint and fix the number and salaries, with the approval of the Board of Directors, of such subordinate personnel as may be necessary for the proper discharge of the duties and functions of the Authority, and with the approval of the Board of Directors, to remove, suspend, or otherwise discipline, for cause, any subordinate employee of the Authority; and e. To perform such other duties as may be assigned to him by the Board of Directors from time to time.

Sec. 14. Appointment and Promotion. - In the appointment and promotion

of officers and employees, merit and efficiency shall serve as basis, and no political test or qualification shall be prescribed and considered for such appointments or promotions. Said officers and employees shall be subject to the Civil Service Law, rules and regulations.

CHAPTER V MANDATED APPROPRIATIONS

Sec. 15. Appropriation - To carry out the purposes of this Act, the amount

of One billion pesos (Php1,000,000,000) is hereby authorized to be appropriated for the initial operation of the MRA. Thereafter, the annual expenditures including capital outlays of the Authority shall be provided in the General Appropriations Act. CHAPTER VI TAXES, DUTIES AND CHARGES

Sec. 17. Exemption from Taxes, Duties, Customs Bonds and Port

Charges. - The Authority is hereby exempt from payment of all national and local taxes upon its capital, franchises, rights of way, earnings, and all other property owned or operated by it and of all duties on all railways materials, supplies and equipment imported into the Philippines for and by the Authority. This exemption shall extend to port charges upon vessels whose entire cargo consists of materials for the construction or equipment of the MRA, and, on other vessels to such proportion of the prescribed port charges as the tonnage of materials for such constructions or equipment may bear to the tonnage of the entire cargo of the vessel; and such exemption shall further extend to the filing of general importer's and general documentary bonds and warehouse bonds for the operation of its warehouses, whether general bonded warehouses or general order store.

Sec. 18. Tax-exempt Loans. - The project and program loans to be obtained

by the National Government for the purposes of this Act shall be exempt from the payment of all national and local taxes. CHAPTER VII AUDIT AND REPORTS

Sec. 19. Audit Personnel and Reports. - The MRA shall be subject to the

Commission on Audit (COA) which shall have the power, authority, and duty to examine, audit, and settle all accounts pertaining to the revenue and receipts of, and expenditures or uses of funds and property of the Authority. a. Personnel. - The Chairman of the COA shall appoint a representative who shall be the Auditor of the Authority, and the necessary personnel to assist said representative in the performance of such duties. The number and

salaries of the Auditor and said personnel shall be determined by the COA Chairman, subject to appropriation by the Board of Directors. In case of disagreement, the matter shall be submitted to the President of the Philippines whose decision shall be final. Said salaries and all other expenses of maintaining the Auditor's office shall be paid by the Authority. b. Report. - The financial transactions of the MRA shall be audited in accordance with law, administrative regulations, and the principles and procedures applicable to commercial corporate transactions. A report of audit for each fiscal year, by the representative of the COA Chairman, through the latter, to the Board of Directors of the Authority, and copies thereof shall be furnished the President of the Philippines, the Secretary of Economic Planning, the Senate President and the Speaker of the House of Representatives. The report shall set forth the scope of the audit and shall include a statement of assets and liabilities, capital and surplus or deficit; a statement and surplus or deficit analysis; statement of income and expenses; a statement of sources and application of funds; and such comments and information as may be necessary, together with such recommendations with respect thereto as may be advisable, including a report of any impairment of capital noted in the audit. The report shall also show specifically any program, expenditures, or other financial transaction or undertaking observed in the course of audit, which in the opinion of the Auditor, has been carried out or made without authority of law.

Sec. 20. Legal Department - The Authority shall have its own legal

department, the chief and members of which shall be appointed by the Administrator with the approval of the Board of Directors.

Sec. 21. Exemption from the LTFRB Law. - The Authority shall not be

subject to the authority, supervision and control of the Land Transportation Franchising and Regulatory Board (LTFRB), created under Executive Order No. 202, Series of 1987.

Sec. 22. Strikes During National Emergency. - The provisions of law to

the contrary notwithstanding, in cases of national emergency, or when in the opinion of the President of the Philippines, the national security or interest is in imminent

1 danger, employees and laborers of the Authority shall not strike for the purpose of securing changes or modification in their terms and conditions of employment during said period of emergency: Provided, however, That during the implementation of this 4 Act, management and labor should always strive to maintain industrial peace by availing of and exhausting all methods of resolving all labor disputes to ensure the continuous, effective and successful establishment of the Mindanao Railways: 7 Provided, further, That the Authority may enter into collective negotiation agreements, one for personnel of supervisory rank and the other for personnel of non-supervisory rank regardless of the number of recognized unions which may be or might have been organized therein.

Sec. 23. Applicability of the Revised Corporation Code. - The provisions

of the Corporation Code which are not inconsistent with the provisions of this Act, shall be applicable to the Authority.

Sec. 24. Implementing Rules and Regulations. -The DOTr, in consultation

with concerned government agencies and stakeholders, shall promulgate the implementing rules and regulations of this Act, within sixty (60) days from the effectivity of this Act.

Sec. 25. Congressional Oversight Committee. - There is hereby created

a Congressional Oversight Committee on Railways to be composed of five (5) members from the Senate, which shall include the chairperson of the Senate Committee on Public Services, and five (5) members from the House of Representatives, which shall include the Chairperson of the House Committee on Transportation. The Congressional Oversight Committee on Railways shall be jointly chaired by the Chairperson of the Senate Committee on Public Services and the Chairperson of the House Committee on Transportation. The Congressional Oversight Committee on Railways shall exercise oversight on the implementation of this Act.

Sec. 26. Separability Clause. - If any portion of this Act is declared

unconstitutional or invalid, the portions or provisions which are not affected shall continue to be in full force and effect.

Sec. 27. Repealing Clause. - All laws, decrees, executive orders and rules

and regulations or parts thereof which are inconsistent with this Act are hereby repealed or modified accordingly.

Sec. 25. Effectivity. - This Act shall take effect fifteen (15) days after its

complete publication in a newspapers of general circulation and the Official Gazette. Approved,