Merry Christmas and a Happy New Year!

University of the Philippines Carillon Restored

After 19 years of silence, the bells of Carillon started to ring again. The UP Carillon was formally turned over to the University of the Philippines Administration last December 18, 2007 in a simple outdoor ceremony marking the occasion. UP Naming Mahal was the inaugural music played by the carillonneur followed by a Christmas music medley.


The UP Carillon restoration project started in 2006 and is currently being spearheaded by the University of the Philippines Alumni Association. Thirty six new bells from Dutch company Petit and Fritsen were installed by the restoration team as part of the University of the Philippines Centennial celebration.

The UP Carillon was donated to the University in 1952 with National Artist for Architecture Juan Nakpil designing the tower. The original Carillon had 48 bells and were forged by Van Bergen Co. The original Carillon had four octaves while the newly restored UP Carillon has only three octaves.

Philippine National Railways and Light Rail Transit Authority To Be Dissolved

Three separate bills were filed calling for the creation of the National Railway Authority and the abolition of the Philippine National Railways and Light Rail Transit Authority during the first regular session of the of the 14th Congress of the Republic of the Philippines last July, 2007.

Senator Ramon Revilla Jr. introduced Senate Bill No. 816 last July 3, 2007 entitled AN ACT ACCELERATING THE DEVELOPMENT OF A NATIONAL RAILWAY SYSTEM, CREATING FOR THE PURPOSE THE NATIONAL RAILWAY AUTHORITY, PRESCRIBING ITS POWERS, FUNCTIONS AND DUTIES.

Senator Loren Legarda introduced Senate Bill No. 1389 last July 26, 2007 entitled AN ACT ACCELERATING THE DEVELOPMENT OF A NATIONAL RAILWAY SYSTEM, CREATING FOR THE PURPOSE THE NATIONAL RAILWAY AUTHORITY, PRESCRIBING ITS POWERS, FUNCTIONS AND DUTIES AND FOR OTHER PURPOSES.

Senator Richard Gordon introduced Senate Bill No. 1410 last July 31, 2007 entitled AN ACT CONSOLIDATING THE PHILIPPINE NATIONAL RAILWAYS AND THE LIGHT RAIL TRANSIT AUTHORITY INTO THE NATIONAL RAILWAY AUTHORITY TO INTEGRATE AND REVITALIZE RAILWAY TRANSPORTATION IN THE PHILIPPINES, AUTHORIZING THE ISSUANCE OF BONDS THEREFOR TO BUILD AN ADEQUATE AND EFFICIENT NATIONAL RAILWAY TRANSPORTATION SYSTEM, AND FOR OTHER PURPOSES.

The three bills call for the consolidation of the Philippine National Railways and Light Rail Transit Authority into the National Railway Authority. If the one of the bills will become a law this year, Philippine National Railways will cease to exist ending its long history starting in 1964 when Republic Act No. 4156 creating the Philippine National Railways was approved. Light Rail Transit Authority, which was approved in 1980 when Executive Order No. 603 took effect, will also be folded into the new authority.

Philippine National Railways and Light Rail Transit Authority To Be Dissolved

Three separate bills were filed calling for the creation of the National Railway Authority and the abolition of the Philippine National Railways and Light Rail Transit Authority during the first regular session of the of the 14th Congress of the Republic of the Philippines last July, 2007.

Senator Ramon Revilla Jr. introduced Senate Bill No. 816 last July 3, 2007 entitled AN ACT ACCELERATING THE DEVELOPMENT OF A NATIONAL RAILWAY SYSTEM, CREATING FOR THE PURPOSE THE NATIONAL RAILWAY AUTHORITY, PRESCRIBING ITS POWERS, FUNCTIONS AND DUTIES.

Senator Loren Legarda introduced Senate Bill No. 1389 last July 26, 2007 entitled AN ACT ACCELERATING THE DEVELOPMENT OF A NATIONAL RAILWAY SYSTEM, CREATING FOR THE PURPOSE THE NATIONAL RAILWAY AUTHORITY, PRESCRIBING ITS POWERS, FUNCTIONS AND DUTIES AND FOR OTHER PURPOSES.

Senator Richard Gordon introduced Senate Bill No. 1410 last July 31, 2007 entitled AN ACT CONSOLIDATING THE PHILIPPINE NATIONAL RAILWAYS AND THE LIGHT RAIL TRANSIT AUTHORITY INTO THE NATIONAL RAILWAY AUTHORITY TO INTEGRATE AND REVITALIZE RAILWAY TRANSPORTATION IN THE PHILIPPINES, AUTHORIZING THE ISSUANCE OF BONDS THEREFOR TO BUILD AN ADEQUATE AND EFFICIENT NATIONAL RAILWAY TRANSPORTATION SYSTEM, AND FOR OTHER PURPOSES.

The three bills call for the consolidation of the Philippine National Railways and Light Rail Transit Authority into the National Railway Authority. If the one of the bills will become a law this year, Philippine National Railways will cease to exist ending its long history starting in 1964 when Republic Act No. 4156 creating the Philippine National Railways was approved. Light Rail Transit Authority, which was approved in 1980 when Executive Order No. 603 took effect, will also be folded into the new authority.

Executive Order No. 603

CREATING A LIGHT RAIL TRANSIT AUTHORITY, VESTING THE SAME WITH AUTHORITY TO CONSTRUCT AND OPERATE THE LIGHT RAIL TRANSIT (LRT) PROJECT AND PROVIDING FUNDS THEREFOR

WHEREAS, the economic growth, stability and security of the Nation require an efficient, adequate, economical, safe, convenient, and dependable transportation system that shall truly be responsive to the demands of the populace consistent with the total scope of metropolitan needs;

WHEREAS, Metropolitan Manila, as the premier metropolis of the country, requires an efficient mass transportation system which can provide its people with safe, fast and reliable mobility;

WHEREAS, a Metropolitan Manila transportation, land use and development planning study was conducted to guide transportation investments and operations, and such study indicates that a light rail transit system is recommended, among others, to alleviate the worsening traffic and transportation situation in Metropolitan Manila, within the context of a rational land use pattern;

WHEREAS, it is imperative to provide an organizational structure that will oversee the effective implementation of the light rail transit project, including the construction and operation thereof;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of powers vested in me by Presidential Decree No. 1416, do hereby order the creation and organization of a Light Rail Transit Authority.

ARTICLE 1

DECLARATION OF POLICY AND CREATION OF THE LIGHT RAIL TRANSIT AUTHORITY

Sec. 1. Declaration of Policy. It is hereby declared to be the policy of the State to promote, encourage, and protect the mutual intermodal and intramodal complementation, cooperation, and synchronization of the common carrier services in the most practicable, expeditious, and organized manner with maximum safety, utility, service, and cost effectiveness, as goals for both the public who avail of these facilities and the investors/operators who provide the transportation services; to foster sound economic conditions within the transportation industry and among the several modes and common carriers, in order that a healthy, dynamic, and strong private sector can meet the transportation requirements of the Nation, among others, and in the pursuit thereof, the government and the private sector shall interact effectively by performing functions and pursuing priorities for which each is best suited and, at the same time, reinforcing and complementing each other.

Sec. 2. Creation of Authority. To carry out the foregoing transportation policy, there is hereby created a corporate body to be known as the LIGHT RAIL TRANSIT AUTHORITY, hereinafter called the "AUTHORITY", which shall be primarily responsible for the construction, operation, maintenance, and/or lease of light rail transit systems in the Philippines, giving due regard to the reasonable requirements of the public transportation system of the country. The principal office of the Authority shall be in the Metropolitan Manila Area, but it may establish branches and agencies elsewhere within the Philippines, as may be necessary for the proper conduct of its business and the discharge of its functions. The Authority shall be attached to the Ministry of Transportation and Communication.

The Authority shall conduct its business, according to prudent commercial principles and shall ensure, as far as possible, that its revenues for any given year are, at least sufficient to meet its expenditures. Any excess of revenues over expenditure in any fiscal year may be applied by the Authority in any way consistent with this Order, including such provisions for the renewal of capital assets and the repayment of loans, as the Authority may consider prudent.

Sec. 3. Board of Directors. The powers and functions of the Authority shall be vested in and exercised by the Board of Directors composed of the Minister of Human Settlements as Chairman; Minister of Transportation and Communications as Vice Chairman; the Minister of Finance, the Minister of Economic Planning, the Minister of Public Highways, the Minister of the Budget, the Chairman of the Board of Transportation, and the Administrator of the Authority, as ex-officio members; and one (1) representative from the private sector to be appointed by the President. The appointed director shall serve for a term of two (2) years.
The officials next in rank to, or such officials duly designated by, the regular members shall serve as alternate members, except that, in the absence of the Chairman, then Board shall elect a temporary presiding officer. The alternate members shall attend meetings of the Board and committees assigned to them by their principals and receive the corresponding per diems, whenever their principals are absent or said positions are vacant.

The Chairman and each Member of the Board shall receive a monthly commutable representation allowance of ONE THOUSAND (P1,000.00) PESOS and per diem of TWO HUNDRED (P200.00) PESOS for every meeting of the Board actually attended: Provided, That the total amount of per diems which each may receive shall not exceed ONE THOUSAND (P1,000.00) PESOS a month.

ARTICLE 2

CORPORATE POWERS

Sec. 4. General Powers. The Authority, through the Board of Directors, may undertake such action as are expedient for or conducive to the attainment of the purposes and objectives of the Authority, or of any purpose reasonably incidental to or consequential upon any of these purposes. As such, the Authority shall have the following general powers:

(1) To have continuous succession under its corporate name, until otherwise provided by law;
(2) To prescribe, amend, and/or repeal its by-laws;
(3) To adopt and use a seal and alter it at its pleasure;
(4) To sue and be sued;
(5) To contract any obligation or enter into, assign or accept the assignment of, and vary or rescind any agreement, contract of obligation necessary or incidental to the proper management of the Authority;
(6) 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 law;
(7) 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;
(8) To improve, develop or alter any property held by it;
(9) To carry on any business, either alone or in partnership with any other person or persons;
(10) To employ an agent or contractor or perform such things as the Authority may perform;
(11) To exercise the right of eminent domain, whenever the Authority deems it necessary for the attainment of its objectives;
(12) 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;
(13) To determine the fares payable by persons travelling on the light rail system, in consultation with the Board of Transportation;
(14) To establish, operate, and maintain branches or field offices when required by the exigencies of its business;
(15) To determine its organizational structure and the number, positions and salaries of its personnel, subject to pertinent organization and compensation law; and
(16) 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 Law that are not inconsistent with the provisions of this Order, or with orders pertaining to government corporate budgeting, organization, borrowing, or compensation.

Sec. 5. Specific Powers. The Board shall have the following specific powers:

(1) To provide comprehensive policy guidance for the development, operation, and promotion of a light rail transit system as provided for in this Order;
(2) To formulate a comprehensive and practicable plan/program for the early completion of an LRT system in Metropolitan Manila; to employ the necessary consultancy services therefor and to organize, and employ personnel for a Project Management Office that will supervise the construction of the said Metropolitan Manila LRT system;
(3) To borrow or otherwise raise money and charge all or part of its properties as security therefor;
(4) To create and issue bonds, notes or other securities which may be charged on the property, undertaking and/or revenue of the Authority of any part thereof;
(5) To invest any funds of the Authority available for investment;
(6) To cooperate, coordinate, and exchange such information, studies, and reports with, and to seek the cooperation of other agencies and instrumentalities of the National Government including government-owned or controlled corporations, as will be most effectively conducive to the achievement of the purposes of this Order;
(7) To provide managerial or administrative expertise including the rendering of professional and training services for the development of the staff and employees of the Authority;
(8) To issue orders, not inconsistent with this Order, negotiating the work and conduct of its personnel;
(9) To appoint, discipline, and remove personnel of the Authority in accordance with laws;
(10) To recommend to the President, through the National Economic and Development Authority, the establishment of light rail systems, where feasible, in other parts of the country;
(11) To report annually to the President of the Philippines on the status of its operations and finances, not later than three (3) months after the year end; and
(12) To perform such acts as are proper and necessary to carry out the purposes of the Authority.

ARTICLE 3

BORROWING AUTHORITY

Sec. 6. Domestic Indebtedness. Whenever the Board deems it necessary for the Authority to incur indebtedness by contracting loans with domestic financial institutions or to issue bonds to carry out the purpose for which the Authority has been organized, it shall, by resolution, so declare and state the purpose for which the proposed debt is to be incurred and such terms and conditions as it shall deem appropriate for the accomplishment of the said purpose; Provided, That in the case of bond issued, the same shall be subject to the approval of the President of the Philippines, upon recommendation of the Minister of Finance.
The bonds issued under the authority of this section shall be exempt from the payment of all taxes by the Republic of the Philippines, or by any authority, branch, division or political subdivision thereof, which parts shall be stated upon the face of said bonds.

A sinking fund shall be established by the Authority in such manner that the total annual contribution thereto, accrued at such rate of interest as may be determined by the Minister of Finance in consultation with the Monetary Board, shall be sufficient to redeem at maturity the bonds issued under this section. The sinking fund shall be under the custody of the Central Bank of the Philippines, which shall invest the same, subject to the approval of the Board and the Minister of Finance in consultation with the Monetary Board: Provided, That the proceeds thereof shall accrue to the Authority.

The Republic of the Philippines hereby guarantees the payment by the Authority of both the principal and the interest of the bonds or other evidences of indebtedness and shall pay such principal and interest, in case the Authority fails to do so. Provided, That the sums so paid by the Republic of the Philippines shall be refunded by the Authority; and Provided, further, That the Authority, to assure such refunding, shall establish reserves or sinking funds and comply with such other restrictions and conditions as the Minister of Finance may prescribe and establish for that purpose.

Sec. 7. Foreign Loans. The Authority is hereby authorized to contract loans, credits or indebtedness in any convertible foreign currency or capital goods, from foreign governments or any international financial institutions or fund source, or to issue bonds, the total outstanding amount of which, exclusive of interests, shall not exceed P300 million or the equivalent thereof in other currencies, on such terms and conditions as it shall deem appropriate for the accomplishment of its purposes and to enter into and execute agreements and other documents specifying such terms and conditions.

The President of the Philippines, by himself, or through his duly authorized representative, is hereby authorized to negotiate and contract with foreign governments or any international financial institutions or fund sources, in the name and on behalf of the Authority, for the accomplishment of its purposes.
The President of the Philippines, by himself, or through his duly authorized representative, is hereby further authorized to guarantee, absolutely and unconditionally as primary obligor and not as surety merely, in the name and on behalf of the Republic of the Philippines, the payment of the loans, credits, indebtedness and bonds issued up to the amount herein authorized, which shall be over and above the amount which the President of the Philippines is authorized to guarantee under Republic Act Numbered Forty-Eight Hundred Sixty, as amended, as well as the performance of all or any of the obligations undertaken by the Authority in the territory of the Republic of the Philippines, pursuant to Loan Agreements entered into with foreign governments or any international financial institutions or fund sources.

Any loan, credit, indebtedness, contracted by the Authority and the payment of the principal, interest and other charges thereon, as well as the importation of machinery, equipment, materials, supplies, and services paid from the proceeds of any such loan, credit or indebtedness shall be exempt from all direct and indirect taxes, customs duties, fees, imposts, other charges and restrictions, including import restrictions, previously and presently imposed and to be imposed by the Republic of the Philippines, or any of its agencies and political subdivisions.

ARTICLE 4

TAX AND DUTY EXEMPTIONS

Sec. 8. Equipment, Machineries, Spare Parts and Other Accessories and Materials. The importation of equipment, machineries, spare parts, accessories and other materials, including supplies and services, used directly in the operations of the Light Rail System, not obtainable locally on favorable terms, out of any funds of the Authority including, as stated in Section 7 above, proceeds from foreign loans, credits or indebtedness, shall, likewise, be exempted from all direct and indirect taxes, customs duties, fees, imposts, tariff duties, compensating taxes, wharfage fees and other charges and restrictions, the provisions of existing laws to the contrary notwithstanding.

ARTICLE 5

ORGANIZATION AND MANAGEMENT

Sec. 9. Management. The management of the Authority shall be headed by an Administrator, who shall be assisted by two (2) Deputy Administrators. The LRT Administrator and Deputy Administrators shall be citizens of the Philippines, at least thirty-five (35) years old on the date of their appointments, of good moral character or recognized executive ability and competence, with adequate training in either transport planning, management and economics, finance, law, public utility or other transport related aspects. They shall be appointed by the President.

Sec. 10. Powers and Duties of the Administrator. The Administrator shall have the following powers and duties:

(1) To implement, enforce, and apply the policies, programs, plans, standards, guidelines, procedures, decisions, rules and regulations issued, prescribed, or adopted by the Board;
(2) To undertake studies, investigations, and other activities related to the operations, on his own initiative or upon instructions of the Board, and to submit comprehensive reports and appropriate recommendations to the Board for its information and action;
(3) To undertake studies for present and future requirements of development of the LRT project expansion, in consultation with appropriate agencies;
(4) To manage the affairs of the Authority, subject to the provisions of this Order and applicable laws, orders, rules and regulations;
(5) With the approval of the Board, to determine the staffing pattern and the number of personnel of the Authority and to define their functions and duties;
(6) To regularly inspect the LRT facilities and operations and recommend measures to maintain a high standard of safe, fast and reliable service;
(7) To establish and maintain, in coordination with the appropriate government offices and agencies a regular and prompt information system regarding traffic flows, LRT operations, finance and other related data;
(8) With the approval of the Board, to delegate such functions and duties to the Deputy Administrators or other ranking officials of the Authority for the efficient administration and management thereof;
(9) To perform such other duties as the Board may assign and such acts as may be necessary and proper to implement this Order.

Sec. 11. Supplies and Services Other Than Personnel. All purchase of supplies or contracts for services, except for personal services, entered into by the Authority, shall be done through competitive public bidding: Provided, That bidding shall not be required when an emergency, as certified by the Administrator, requires immediate delivery of the supplies or performance of the services, and the aggregate amount involved in any one purchase of supplies or procurement of services does not exceed Ten Thousand Pesos, in which case, such purchase or procurement may be made in the usual course of business: Provided, further, That the Authority's emergency purchase of supplies and services shall not exceed the amount of Fifty Thousand Pesos for any one month: Provided, finally, That in comparing bids and in making awards, the Authority shall consider such factors as the cost and relative quality and adaptability of supplies or services; the bidder's financial responsibility, skill, experience, integrity, and ability to furnish repairs and maintenance services; the time of delivery or performance offered; and the bidder's compliance with the specifications desired.

Sec. 12. Departments of the Authority. The Authority shall establish and maintain such departments as it may deem necessary for the proper and efficient transaction and/or operation of its business. The powers and duties of the departments shall be determined by the Board: Provided, That the office of the Chief Legal Counsel of the Authority, which shall be separate and distinct from and independent of the Office of the Government Corporate Counsel, shall advise and represent the Authority in all legal matters, procedures and actions.

Sec. 13. The Auditor. The Chairman of the Commission on Audit shall appoint a representative who shall be the auditor of the Authority. He shall likewise appoint the necessary personnel to assist said representative in the performance of his duties. Subject to the approval of the Board of Directors of the Authority, the salaries of the Auditor and his staff shall be fixed by the Chairman of the Commission on Audit. Salaries and other expenses for the auditor's office shall be paid by the Authority. The Auditor of the Authority and personnel under him may be removed only by the Chairman of the Commission on Audit.

Sec. 14. Authority to Administer Oath. The Chairman of the Board, the Administrator, the Deputy Administrators, and the Chief Legal Counsel of the Authority shall have the power to administer oaths in connection with the transaction of official business.

ARTICLE 6

CAPITALIZATION AND FINANCING

Sec. 15. Capitalization. The Authority shall have an authorized capital of FIVE HUNDRED MILLION PESOS (P500,000,000.00) which shall be fully subscribed by the Republic of the Philippines and other government institutions, corporations, instrumentalities, and agencies, whether national or local, within the framework of their respective charters. The authorized capital shall be used for the purpose of financing the Authority's business transactions and shall be paid as follows:

(1) The sum of TWO HUNDRED MILLION PESOS (P200,000,000.00) to be taken from the general fund in the National Treasury out of appropriations available for the purpose.
(2) The balance of the authorized capital amounting to THREE HUNDRED MILLION PESOS (P300,000,000.00) shall be released from the National Treasury out of appropriations available for the purpose, or subscribed and paid by government institutions as may be authorized pursuant to this Section, with the approval of the President.

Sec. 16. Initial Debt. The Authority shall be indebted to the Government, or any of its ministries, bureaus, agencies or offices, in a sum equal to all expenditures, directly or indirectly advanced or incurred by the Government or any of its ministries, bureaus, agencies or offices, in relation to the investigation, planning and/or construction of the light rail transit system. The Minister of Finance shall, upon prior notice, determine the accuracy and reasonableness of such advances or indebtedness.

ARTICLE 7

PENALTIES

Sec. 17. Penalties. Any person who willfully or maliciously gives false or misleading data or information, or conceals or falsifies a material fact, in any investigation, inquiry or hearing, or other proceeding held by the Board or the Authority or any one duly acting in their behalf, shall be dealt with according to the pertinent provisions of existing penal laws.

ARTICLE 8

FINAL PROVISIONS

Sec. 18. Repealing and Separability Clauses. All laws, decrees, orders, rules and regulations, policies, programs, or parts thereof, that are inconsistent with any of the provisions of this Order, are hereby repealed, amended, or modified accordingly.
Of for any reason, any section or provisions of this Order is declared to be unconstitutional or invalid, the other sections or provisions hereof, which are not affected hereby, shall continue in full force and effect.

Sec. 19. Effectivity. This Order shall take effect immediately.
Done in the City of Manila, this 12th day of July, in the year of Our Lord, nineteen hundred and eighty.

Republic Act 4156

AN ACT CREATING THE PHILIPPINE NATIONAL RAILWAYS, PRESCRIBING ITS POWERS, FUNCTIONS AND DUTIES, AND PROVIDING FOR THE NECESSARY FUNDS FOR ITS OPERATION.

Section 1. Name, Duration and Domicile. A corporation to serve as the instrumentality of the Government of the Philippines in providing a nation-wide railroad and transportation system, is hereby created, to be known as the Philippine National Railways, which shall exist for a term of fifty years from the date of approval of this Act. It shall have its main office in the City of Manila, and shall have such branches and agencies within or outside the Philippines as may be necessary for the proper conduct of its business. The Corporation shall be under the Office of Economics Coordination.

Section 2. Purposes and specific powers. The Philippine National Railways shall have the following purposes and specific powers:
(a) To acquire and hold the assets of the Manila Railroad Company of the Philippine Islands, and to succeed to, or acquire, maintain and operate such grants, concessions and franchises as are now held and enjoyed by the said Manila Railroad Company of the Philippine Islands;
(b) To own or operate railroad, tramways, and other kinds of land transportation, vessels and pipelines, for the purpose of transporting, for consideration, passengers, mail and property between any points in the Philippines; and
(c) As an auxiliary to its main purpose, to own and/or operate powerhouses, hotels, restaurants, terminals, warehouses, timber concessions, coal mines, iron and other mineral properties and to manufacture rolling stock, equipment, tools and other appliances; to construct and operate in connection with its railroad lines, toll viaducts, toll tunnels.

Section 3. Authorized capital stock of the Philippine National Railway. The authorized capital stock of the Philippine National Railways shall be two hundred fifty million pesos divided into one million two hundred fifty thousand par value shares of two hundred pesos each, which shall include the present capitalization of the Manila Railroad Company: Provided, That the increase in the authorized capital shall be fully subscribed by the Government: Provided, further, That the existing long term obligations of the Manila Railroad Company to the Government of the Philippines including its agencies or instrumentalities, in the amount of ninety-two million six hundred thousand pesos shall be converted into capital stocks of the Philippine National Railways and made a part of the subscription: Provided, still further, That the Philippine National Railways shall, aside from its authorized capital stock of two hundred fifty million pesos, receive from the Government of the Philippines the amounts allocated under Republic Acts Numbered Eighteen hundred sixty-seven, Sixteen hundred twenty-three and Eighteen hundred one, for the construction of new railroad lines to the Cagayan Valley, and to the Province of Sorsogon, and the rehabilitation of the Cabanatuan line, respectively: And, provided, finally, That the additional amount of one hundred twenty million pesos be set aside, and the entire amount or so much thereof as may be needed by the Philippine National Railway be made available to the Philippine National Railway at least one year before the completion of the Cagayan and/or Sorsogon construction projects, for the purchase of motive power, rolling stocks and other supplies for use in the new lines, it being specified that fifty million of the authorized capital of the Philippine National Railway shall be invested for the purchase of motive power and rolling stock for the railway project in Mindanao and five million pesos or so much thereof for the survey of said railway project

Section 4. General powers. The Philippine National Railway shall have the following general powers:
(a) To do all such other things and to transact all such business directly or indirectly necessary, incidental or conducive to the attainment of the purpose of the corporation; and
(b) Generally, to exercise all powers of a railroad corporation under the Corporation Law.

Section 5. Board of Directors, Composition and Appointment. The corporate powers of the corporation shall be vested in and exercised by a board of Directors of not more than eleven and not less than five members as may be fixed by the President of the Philippines, consisting of chairman, vice-chairman and other members, appointed by the President of the Philippines with the consent of the Commission on Appointments. The members of the Board need not to be stockholders of the Corporation. The first members of the Board shall serve as designated by the President in their appointments for terms of one, two, and three years, respectively, from date they qualify and assume office; but their successors shall be appointed for terms of three years, except that any person chosen to fill a vacancy shall serve only for the unexpired term of the member whom he succeeds. for actual attendance of meetings, each such members shall receive a per diem of twenty-five pesos.

Section 6. 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 approval of the Administrator of Economic Coordination, by-laws, rules and regulations governing the manner in which the general business of corporation 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 General manager, subject to the approval of the President of the Philippines, and to appoint and fix the compensation of the other officers of the Corporation, with the approval of the Administrator of Economic Coordination. 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 General Manager.
(c) To approve, subject to the final action of the Administrator of Economic Coordination, the annual and/or such supplemental budgets of the Corporation which may be submitted to it by the General Manager from time to time.

Section 7. Suspension and removal of Directors. Any member of the Board of Directors may be suspended or removed by the President of the Philippines.

Section 8. Prohibition for Board Members. No chairman or member of the Board of Directors of the Corporation shall at the same time serve in the Corporation in any capacity whatsoever other than as Chairman or member thereof, unless otherwise authorized by the President of the Philippines or existing law.

Section 9. Managing head. The management of the Corporation shall be vested in the General Manager.

Section 10. Powers and duties of the General Manager. The General Manager shall have the following powers and duties:
(a) To direct and manage the affairs and business of the Corporation 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 any 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;
(d) To appoint and fix the number of 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 Corporation, and with the approval of the Board of Directors, to remove, suspend, or otherwise discipline, for cause, any subordinate employee of the Corporation; and
(e) To perform such other duties as may be assigned to him by the Board of Directors from time to time.

Section 11. 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.

Section 12. Exemption from taxes, duties and port charges. The Corporation is hereby exempt from payment of all taxes of every name and nature municipal, city, provincial, or national upon its capital stock, franchises, rights of way, earnings, and all other property owned or operated by it and all duties on all railways materials, supplies and equipment imported in the Philippines for and/or by the said Corporation and this exemption shall extend to port charges upon vessels whose entire cargo consist of materials for the construction or equipment of the Corporation and to such proportion of the prescribed port charges on other vessels as the tonnage of materials for such constructions or equipment may bear to the tonnage of the entire cargo of the vessel.

Section 13. Audit Personnel and Report.
(a) Personnel. The Auditor General shall appoint a representative who shall be the Auditor of the Corporation, and the necessary personnel to assist said representative in the performance of his duties. The number and salaries of the Auditor and said personnel shall be determined by the Auditor General, 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 Corporation.
(b) Report. The financial transactions of the Corporation 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 Auditor General, through the latter, to the Board of Directors of the Corporation, and copies thereof shall be furnished the President of the Philippines, the Administrator of Economic Coordination and the Presiding Officers of the two Houses of Congress. 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 also shows 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 on or made without authority of law.

Section 14. Legal Counsel. Any provision of law or executive order to the contrary notwithstanding, the Philippines National Railway shall have its own legal department, the chief and members of which shall be appointed by the Board of Directors.

Section 15. Exemption from the Public Service Act. The Philippine National Railway shall not be subject to the authority and supervision of the Public Service Commission.

Section 16. Liquidation. When its term or period of existence has expired in accordance with the provision of this Act, it shall nevertheless, continue as a body corporate for three years after the time of its dissolution for the purpose of prosecuting and defending suits by or against it and of enabling it gradually to settle and close its affairs, to dispose of and convey its properties, but not for the purpose of continuing the business for which it was established. In order to carry out its liquidation, upon the dissolution of the Corporation, a Board of Liquidators shall appointed by the President to take charge of winding up its corporate affairs and affecting its liquidation.

Section 17. 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 danger, employees and laborers of the Corporation shall not strike for the purpose of securing changes or modification in their terms and conditions of employment during said period of emergency.

Section 18. Reversion of General Funds. All funds resulting from dissolution and liquidation of the Corporation as herein provided shall revert to the general funds of the Government.

Section 19. Applicability of the Corporation Law. The provisions of the Corporation Law which are not inconsistent with the provisions of this Act, shall be applicable to the corporation created hereby.

Section 20. Repeal or Modifications. All Acts, Executive Orders, Administrative Orders, and Proclamations or parts thereof inconsistent with any of the provisions of this Act, are hereby repealed or modified accordingly.

Section 21. Separability Clause. In the event any provision of this Act or the application of such provision to any person or circumstance is declared unconstitutional, the remainder of this Act or the application of said provision to other persons or circumstances shall not be affected thereby.

Section 22. Dissolution of the Manila Railroad Company of the Philippine Islands. The Corporation known as Manila Railroad Company of the Philippine Islands is hereby abolished and dissolved. Its rights, permanent personnel, assets, liabilities and obligations of all kinds are hereby transferred to or assumed by the Corporation herein created. A process of liquidation shall be decided upon, and carried out, in accordance with general principles of law and accounting procedures.

Section 23. Effectivity. This Act shall take effect upon its approval.

Reconstruction of the Manila Railway Company Limited

From The Far Eastern Review January 1907

The directors of the Manila Railway Company have announced from their London office that negotiations for the reconstruction of the company necessary to carry out the terms of settlement with the United States Government, set forth in the circular of August 3rd last, sent to the shareholders, are concluded, and are contained in a plan of reconstruction issued to the shareholders with the report for the year ended December 31st, 1905. The plan has received the careful attention of the directors, and has been adopted by the shareholders.

Claim Against United States

The directors recall that after the Spanish-American War the company presented a claim for the amount due under the guarantee given with the Spanish concession; but
liability was denied by the Washington Government. After the return of the railway to the company there were presented to the United States Government claims for use and for damages. In June, 1905, the Philippine Government invited tenders from United States or Philippine Corporations or citizens for the construction of various lines on the Island of Luzon, as well as on other Philippine islands. Two members of the Board of Directors proceeded at once to Washington to take up again with the British Ambassador the negotiations for damages. After much consultation Messrs. Speyer & Co., of New York, with a view to cooperating with the company, and at the same time, as far as possible, to protect the shareholders' interests, presented a bid for the construction of various lines on the Island of Luzon, which were considered to be profitable commercial enterprises if worked in connection with the railroads owned by the company. None of the bids presented were accepted; but, as the result of subsequent negotiations, an award was made to Messrs. Speyer & Co. of a concession for these lines, which have now been assigned to a New Jersey Company organized by them, known as the Manila Railroad Company. The concession which has been granted to the American company is a perpetual concession, qualified only by the not unusual condition that it is subject to amendment, alteration or repeal by the Congress of the United States. It authorizes and requires the construction of 450 miles of railroad in the Island of Luzon, which are reported by Mr. Horace L. Higgins, general manager of the Manila Railway Company, Ltd., to be likely to be remunerative, and provides that the favorable rates of taxation prescribed in respect to the new lines shall apply to the existing lines when owned or operated by the American company, and that the concession or franchise shall appertain to the English company's lines when it shall have fully discharged all claims against the United States and the Philippine Government. Mr. Higgins, who has been closely associated with the Manila Railway since its formation, has agreed to take the office of President and General Manager of the American company.

A Satisfactory Position

In the opinion of the directors the position thus brought about is thoroughly satisfactory. They have, therefore, with the assistance of Messrs. Speyer & Co., in New York, and Messrs. Speyer Brothers, in London, very carefully considered how to effect the transfer of the property to the American company and the construction of the new lines, at the same time ensuring that practically the entire net revenue of both the present system and the new lines shall be retained. A new English company will be formed called the Manila Railway Company (1906), Limited, referred to herein as "the new company," which will act as a holding or securities company. As part of the plan, the following agreements will be made:-

(1)An agreement with the American company under which the English company will sell its undertakings in consideration of an agreed amount of the American company's securities;
(2) an agreement with the new company under which the old company will nominate the new company to receive such securities in consideration of the new company's issuing to the old company an agreed amount thereof;
(3) an agreement between the new company and American company for purchase by the new company of bonds and shares of the American company to be issued to obtain money for construction of new lines and other corporate purposes. Under the provisions of the Act of Congress applying to corporations doing business in the Philippine Islands, bonds and shares of the American company cannot be issued except in exchange for actual cash or for property at a fair valuation equal to the par value of the bonds or shares so issued.

The effect of the arrangement will be that there will be vested in the new company, as a holding company, practically all the bonds and shares issued by the American company. These will be vested by the new company in trustees, and against them will be issued the shares and securities of the new company, the prescribed portion of which will be offered to the shareholders in exchange for their existing holdings. The securities of the new company will thus have a charge on the entire net revenue, not only of the 208 miles of the present system, but of the further 420 miles to be built under the new concessions.

New Company

The Manila Railway Company (1906), Limited, will have an authorized capital of £4,000,000, divided into £200,000 5 per cent non-cumulative preference shares of £10 each and 200,000 ordinary shares of L10 each. There will be a present issue in 4 per cent "A" debenture bonds of £1,600,000 and in 4 per cent "B" debenture bonds of £1,730,000. Power will be reserved in the trust deed that further amounts of each class of debenture bonds may be created and issued for the acquisition of securities issued by the American company for the construction or acquisition of new mileage or other capital purposes, provided that the total amount of bonds to be issued for the construction or acquisition of new mileage shall not exceed the rate of £5,000 of each class per mile, and that for other capital purposes the amount to be issued shall not exceed £50,000 per annum of each class. It is proposed to deal with the securities and shares of the new company as follows: —Four per cent "A" debenture bonds: In exchange for the securities of the present company, £1,257,200; issued to provide funds for the requirements of the plan, £342,800; reserved for future construction and equipment, £1,400,000; total £3,000,000. Four per cent "B" debenture bonds: In partial exchange for the securities of the present company, £730,000; issued to provide funds for the requirements of the plan, £1,000,000; reserved for future construction and equipment £1,270,000; total, £3,000,000. Preference shares: In exchange for the shares and securities of the present company, £1,180,000; issued to provide funds for the requirements of the plan, £820,000; total, £2,000,000. Ordinary shares: In exchange for the shares of the present company, £399,270; reserve for new company, £1,600,730; total, £2,000,000. The interest charges on the £1,600,000 "A" debenture bonds and £730,000 "B" debenture bonds will amount to £93,200, thus reducing the annual interest charges by about £15,000. Mr. Higgins estimates that the net income of the present system of 208 miles, having regard to the increased traffic, which should be brought as each connecting branch of the new system is opened, will be £116,000 for 1906, and will by 1912 have increased to £153,000. It is estimated that the construction of the 420 miles of new railroad will cost approximately £3,100,000 for which the issue of the securities reserved for this should fully provide, and that construction should be completed in 1911. Mr. Higgins estimates that the yearly net earnings of the sections, beginning with 1907, should be as follows: £1,200, £29,300, £66,900, £112,200, £135,800, £155,000. The total estimated net revenue of the 628 miles when completed and in operation will be £308,100.

Terms of Exchange

The securities to be received in exchange for each principal sum of £100 existing securities are as follows: For 5 per cent first mortgage stock, £112 new 4 per cent "A" debenture bonds and i6s.8d. for accrued interest to December 31st, 1906; for 6 per cent prior lien bonds, Series "A," £120 new 4 per cent "A" debenture bonds and £3 accrued interest; for 6 per cent prior lien bonds Series "B" £115 new 4 per cent "A" debenture bonds and 3 accrued interest; for 6 per cent secured notes, £112 new 4 per cent "A" debenture bonds, with 3 os. 4d. accrued interest; for 6 per cent debentures £100 new 4 percent "B" debenture bonds, £100 new preference shares, and £6 cash; for 7 per cent cumulative preference shares,. £150 new preference shares; for ordinary shares, £300 new ordinary shares; for deferred shares, £300 new ordinary shares.

Annual Report

The report of the Manila Railway Company, ltd., for the year ended December 31st, 1905, states that the traffic receipts amounted to $1,694,820 and the expenses in Manila to $723,040 leaving $971,779, which, at 2s. exchange, is equal to £97,178. The profit on working the quay line amounted to £1,429, and the profit in exchange to £242, while the charges in London were £3,790, leaving as net revenue £95,059, out of which interest has been paid on first mortgage registered stock (£7,500) and on prior lien bonds, "A" and "B" (£35,100). The value of the Philippine currency has remained steady throughout the year at slightly over 2s. per dollar. The claims against the governments of the United States and of the Philippine Islands have been settled, subject to the consent of the shareholders and security holders, on the terms stated in the chairman's circular of August 3, 1906. The company's claims on the Spanish Government are being prosecuted, but the directors regret that they are still unable to report any recoveries. The construction of the extensions has made good progress. The receipts from extensions to December 31st, 1905, are £13,305. The amount paid for interest on secured notes during 1905 was £20,250, so that a debit balance of £6,944 is carried forward to 1906.

The Manila Railway Company

Far Eastern Review, September, 1906
pp. 120 – 124


The Manila Railway Company, operating the only steam railway in the Philippines, between Manila and Dagupan, was organized in London in 1888. The concession for this road was secured from the Spanish Government for a term of 99 years dating from April, 1887, and during that period the Government guaranteed the interest, payable from the Philippine Treasury, of 8 per cent, on a capital of $4,964,000, which was subsequently increased to $5,373,700 from the extra cost of works authorized by the Government. The working expenses for the purpose of calculating the guarantee, was based on 50 per cent of the gross earnings. At the expiration of this concession the road was to revert to the State without compensation, and there was no option for the purchase by the Government at any time during the life of the franchise.

The Spanish Government regularly paid the guarantee, every three months up to 1897, but, on the change of sovereignty, the payments were stopped. The company, acting under the best legal advice, took the natural stand that, under international law, the United States assumed the obligations of Spain on the transfer of authority, while the American officials have contested the point.

This is in addition to the claims of the Company for damages to their lines through insurrection, and for revenues while under control of the military amounting to $1,500,000 gold, has been a matter of diplomatic negotiation ever since, and was only settled on the signing of the recent contract for the new lines.

In 1903, the Company secured concessions from the Philippine Commission for the construction of three extensions to the main line aggregating 87 miles, one to Camp Stotsenburg, one to Cabanatuan and the other to Antipolo. The Company as formerly organized had and authorized capital of $1,000,000 gold ordinary and $1,500,000 preference shares, with borrowing powers of $7,575,000. The headquarters are at 43 New Broad St., London, with the following Board of Directors:

C.J. C. Scott, (Chairman), A. von Andre, Admiral Sir C. A. G. Bridge, R. H. Bensen, R. Fleming and J. G. Le Marchant, Secretary, J. Mackenzie.

Two years ago, a controlling interest in the company was secured by Messrs. Speyers and Co., the well-known bankers of New York and London, and through this firm the negotiations with the government were carried out for the construction of the new roads.

The Hon. Cameron Forbes, in an article on the Railroads of the Islands, recently published in the anniversary number of the Daily Bulletin, has the following to say about the negotiations leading up to the new concessions:-
On June 20, 1905, Secretary Taft advertised proposals in Washington asking for bids for the construction of railways, and they were similarly advertised in Manila. The terms, which had been very carefully drawn under good advice, called for very good construction, early completion, and, in general, would have provided the Islands with an admirable system at an early date. There were eleven routes advertised, amounting in all to an aggregate of about 1,200 miles. The probable cost of construction of this number of miles was the extreme limit upon which the Government was authorized to guarantee bonds, as the bill provided that the amount of interest guaranteed could not exceed $1,200,000 a year. At the time these proposals were issued the Government had reason to believe that there would be at least three bids for the whole system.

On December 20, 1905, the bids were opened in Washington in the presence of the Secretary of War and Governor-General Wright. They were three in number, one for the whole island of Luzon, one for three of the Visayan islands, Panay, Negros, and Cebu, and one from a Seattle syndicate for the lines in southern Luzon in the provinces of Albay and Ambos Camarines.

These bids were none of them in accordance with the terms of the proposals, differing in the following respects:

The Speyer syndicate did not ask for a guaranty but made many requests for privileges which were of such a nature that the Government could not possibly be justified in acceding to them as they would have laid it open to the charge of having given away the rights of the people. These included permanent low taxation, permanent high rates without right to regulate, and permanent immunity from competition.

The Seattle syndicate did not deposit any check as guaranty, complying otherwise in every respect with the terms of the proposal.

The second call for bids was issued, to be opened on January 20, 1906. In the second call the following changes were made:

In the first place in regard to bids upon which guaranty was asked the amount of contractor's profit was increased as requested by the Visayan syndicate and the period of time during which surveys and construction could be made lengthened. Other changes of a minor nature were also made.

In regard to unguaranteed lines propositions were requested, no restrictions being placed except that they must comply with the terms of the law.

The Speyers this time offered two propositions, one of them for unguaranteed lines almost entirely as before, but eliminating some of the more objectionable features of their original proposition, and bidding in addition on a guaranteed line from Dagupan to Laoag, making in all some 400 miles of unguaranteed line, much of it short branches from the existing lines, and 160 miles of guaranteed line. Although modified so as to comply with the terms of the law yet the proposition of the Speyers still contained so may features that seemed objectionable that the award was withheld and negotiations entered into with them in the effort to have them so modify their demands as to make a proposition which the Government could be entirely justified in accepting.

After many months of negotiation this has at last been accomplished, Messrs. Speyers & Co. having reached an agreement with the Secretary of War, of the progress of which the Commission were kept cognizant and of which they entirely approve. In the course of these negotiations the plan to construct a guaranteed line from Dagupan to Laoag was abandoned and the result is that all the lines in Luzon are upon one plan, namely, that of unguaranteed construction. On May 25, 1906, the following resolution was passed, formally awarding the concession to the Speyer syndicate and agreeing to pass an Act the terms of which has been agreed upon, word by word, by the parties interested, namely, The Philippine Government, the War Department, and the bankers:

“WHEREAS, the Secretary of War and Vice-Governor Smith have reached an agreement with Messrs Speyer and Company upon the terms of a concession for the construction of 428 miles, more or less, of railroad in the Island of Luzon, the construction and equipment of which they will agree to undertake; and

“WHEREAS, said agreement contained also a provision by which all the railroad lines of the Manila Railway Company, Limited, whether built under the old Spanish grant or under concessions of the Philippine Commission will be transferred to a new company organized under the laws of one of the States of the United States and will be merged with the new system; and

“WHEREAS, said agreement further provides that all claims of the existing railroad against the Insular, provincial, or municipal government of the Philippine Islands and the United States Government will be waived, and the original Spanish grant and concessions by the Philippine Commission for existing railroads will be terminated and merged in the new concession; and

“WHEREAS, it appears to the Commission that it is in the public interest that railroads be constructed in Luzon at the earliest possible date, and that the lines bid for are, on the whole, satisfactory and the terms proposed are such that the public interest will be properly protected if the same be accepted and approved;

“NOW, THEREFORE, BE IT RESOLVED, That the Commission hereby agrees to award to Messrs. Speyer and Company, of New York, a concession, the terms of which are to be the terms contained in the draft of the proposed Act copy of which is hereto attached, which provides for the construction and equipment of 428 miles, more or less, of railway in the Island of Luzon along the routes indicated in the attached draft and upon the terms therein set forth; and

“BE IT RESOLVED FURTHER, That in order that no time may be lost by the said company in making their arrangements to begin their surveys and other plans for early construction the Secretary of War is hereby authorized to give formal notice of such agreement to award; and

“BE IT RESOLVED FURTHER, That the Secretary of War be notified that, upon receipt of the name of the proposed railway company for which the concession is requested, the Commission will pas an Act in accordance with the terms of the accompanying draft, copy of which he now has in Washington.”

The salient points in the Speyer's concession are as follows:

1.They agree to build 428 miles, more or less of railroad throughout the Island of Luzon, including roughly 100 miles in Albay and Ambos Camarines, the line from Manila to Batangas and Lucena with branches, and several branches from the existing line of the Manila and Dagupan Railway, branching to the east and to the west, but principally to the east and including a line from Dagupan to San Fernando de la Union and a branch to the foot of the mountains within a few miles to Baguio.
2.No guaranty is asked on any of this construction.
3.While the rates are to be based on those now enjoyed by the Manila and Dagupan Railway the Government has the power to regulate them at any time.
4.The existing Manila and Dagupan Railway and all its branches give up their franchises, withdraw any claims which they may have against the municipal, provincial, or insular governments or the Government of the United States, and come in under the new charter on exactly the same basis at which the new lines go in.
5.The concession is a perpetual one.
6.There is nothing said in regard to competing lines, the Government being free to grant franchises for such lines at any time.
7.Taxation is one-half of one per cent of the gross earnings for thirty years; 1 ½ per cent for the ensuing fifty years, and thereafter to be fixed by the Government.
8.The company is give twelve months to complete its surveys and thereafter two years in which to complete the first 150 miles and agree to complete 75 miles each year thereafter. This does not compel particularly rapid action.
9.Right of entry of the material for the construction free of duty.
10.Privileges of using right of way 100 feet wide of the public domain, excepting always such part as is laid aside for public uses like parks, streets, etc., and such improved lands as the so-called Friars' Lands, etc., for which payment must be made.
11.Gauge to be three fee six inches and the quality of construction material to be up to first-rate modern standards with due regard to local conditions.
It will be seen that the public are to be amply protected by the above concession. Although the concession is a perpetual one the power of the Government to regulate rates and to grant franchises for competing lines assures the people of the Philippine Islands that industry cannot be choked either by exorbitant rates or by one railroad occupying the fields and preventing any others from coming in. Others can be built whenever it seems advisable to so arrange.

In this enterprise the syndicate has a great advantage in the experience gained by the officers now in in charge of the Manila Railway Company, Limited. Mr. Higgins is manager of this company and deserves a great deal of credit for the condition to which he has brought the property. In spite of light rails, the inexperience of native labor in railroad matters, the recent destruction during the insurrection, and the resultant depression in industrial conditions throughout the Islands he has succeeded in bringing his road-bed up to a very creditable condition and so maintains it. While the railroad is run on what seems to those used to American methods as a slow and cautious plan yet it is to be said to his credit that using wholly native engineers and conductors collissions are almost unknown, and the railroad is run as a profitable enterprise, continually building itself up which is the best criterion of good management. Mr. Higgins' wide experience, thorough training, and known ability are such as to be a guaranty that the work of construction about to be begun will be well and economically done.