G.R. No. 179271 and G.R. No. 179295, April 21, 2009.
BARANGAY ASSOCIATION FOR NATIONAL ADVANCEMENT AND TRANSPARENCY (BANAT), Petitioner, vs. COMMISSION ON ELECTIONS (sitting as the National Board of Canvassers), Respondent. ARTS BUSINESS AND SCIENCE PROFESSIONALS, Intervenor. AANGAT TAYO, Intervenor. COALITION OF ASSOCIATIONS OF SENIOR CITIZENS IN THE PHILIPPINES, INC. (SENIOR CITIZENS), Intervenor.

BAYAN MUNA, ADVOCACY FOR TEACHER EMPOWERMENT THROUGH ACTION, COOPERATION AND HARMONY TOWARDS EDUCATIONAL REFORMS, INC., and ABONO, Petitioners, vs. COMMISSION ON ELECTIONS, Respondent.

FACTS

The cases involve the allocation of seats for the party-list system in the May 14, 2007 elections. The Commission on Elections (COMELEC), sitting as the National Board of Canvassers (NBC), promulgated NBC Resolution No. 07-60 on July 9, 2007, which partially proclaimed thirteen (13) parties as winners entitled to at least one seat each for having garnered at least a presumptive two percent (2%) threshold of the projected total party-list votes. The COMELEC announced it would determine the total number of seats for each winning party using the formula established in Veterans Federation Party v. COMELEC (the Veterans formula) upon completion of the canvass. Subsequently, NBC Resolution No. 07-72 applied the Veterans formula to allocate additional seats. Petitioner BANAT filed a petition before the COMELEC (NBC No. 07-041 (PL)) to proclaim the full number of party-list representatives, which the COMELEC denied as moot via a Resolution dated August 3, 2007. Petitioners Bayan Muna, Abono, and A Teacher assailed NBC Resolution No. 07-60. The consolidated petitions challenge the COMELEC’s application of the Veterans formula and the two percent threshold for seat allocation.

ISSUE

The primary issue is whether the COMELEC committed grave abuse of discretion in applying the Veterans formula and the two percent threshold in allocating party-list seats, and what is the correct legal framework for the Philippine party-list system.

RULING

The Supreme Court modified the procedure for allocating party-list seats. It held that the twenty percent (20%) allocation for party-list representatives in Section 5(2), Article VI of the Constitution is not mandatory but a ceiling. The two percent threshold in Section 11(b) of Republic Act No. 7941 (the Party-List System Act) is unconstitutional in its present form because it prevents the filling of all available party-list seats. The Court established a new procedure:
1. Rank the parties from highest to lowest based on votes garnered.
2. Allocate one seat to each party that obtained at least two percent of the total votes cast for the party-list system.
3. Determine the number of seats allocated for the first party (the party with the highest votes). The ratio of its votes to the total party-list votes, multiplied by the total number of seats available (the remaining seats after step 2, plus any unallocated seats), rounded off to the nearest whole number, gives its additional seats, subject to the three-seat cap.
4. For parties that did not reach the two percent threshold, distribute the remaining seats (after steps 2 and 3) by assigning one seat each to the parties next in rank until all available seats are filled, but no party can exceed three seats.
The Court also clarified that major political parties are not absolutely barred from participating in the party-list system, but they must represent marginalized and underrepresented sectors. The case was remanded to the COMELEC to proclaim the winning parties based on this new procedure.