Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SECTION 1. Subject to the conditions established under this Act and to the provisions of Commonwealth Act numbered One hundred forty-six, as amended, and the Constitution, there is hereby granted to Jose Asturias, hereinafter known as the grantee, for a period of twenty-five years from the approval of this Act, the right, privilege, and authority to construct, operate and maintain a water supply service for the purpose of distributing and supplying water for sale to all domestic and foreign vessels docking at the port of the City of Tacloban. For this Purpose the grantee shall have the right and privilege:

1. To construct, operate and maintain water mains, pipes, conduits, reservoirs, or dams on land owned or duly acquired or obtained by the grantee for said purpose;
   
2. To install, lay, and maintain above or below the ground on the right of way duly acquired or obtained by said grantee, or below the ground on all streets, public thoroughfares and public places and along or under the bridges within the limits of the said port, water mains, pipes, and conduits and all other necessary apparatus and appurtenances for the furnishing and distribution of water to vessels docking at the Port of the City of Tacloban;
   
3. To supply, sell, and furnish such water to all vessels, domestic or foreign, docking at the said port and to charge and collect a schedule of prices and conventional rates for the use of said water, which schedule of prices and rates shall at all times be subject to regulation by the Public Service Commission or its legal successor;
   
4. To purify the sources of the water, and the reservoirs, subject to the approval of the Bureau of Health and to regulate the control and use, and prevent the waste of water: Provided, That this franchise shall not take effect until the grantee shall have obtained from the Public Service Commission a certificate showing the public necessity and convenience thereof;
   
5. The grantee is hereby granted the right and privilege to lease a portion of the port area of the City of Tacloban for the purpose of building its reservoir and other apparatus needed in furnishing and distributing water to all vessels whether domestic or foreign docking at the port of the City of Tacloban and the surrounding islands.
   

SEC 2. In the event that the grantee shall purchase and secure from the National Water and Sewerage Authority water supply, the National Water and Sewerage Authority is hereby authorized to negotiate and transact business with reference to rates.

SEC. 3. All apparatus and appurtenances to be used by the grantee shall be modern and first class in every respect, and the water mains and pipes shall, when laid in streets or public places, be so placed and maintained as not to interfere in any manner with the unrestricted use of such public places and streets.

SEC 4. The grantee hereby agrees to compensate the Government for any damage to its property by reason of the non-construction under this franchise or of any neglect or omission to keep the water mains, pipes, conduits, reservoirs and other property in a safe condition, and to be responsible for any damage to individuals, co-partnerships, private, public or quasi-public associations, corporations, or joint stock companies, arising out of such fault or negligence.

SEC. 5. The grantee shall pay on his real estate, buildings, plant, machinery, and other personal property the same taxes as are now or may hereafter be required by law from other persons. The grantee shall also pay a franchise tax equal to five per centum of the gross earnings under this franchise.

SEC. 6. The grantee shall not, without the approval of the Congress of the Philippines first had, lease, grant, sell, convey or give in usufruct this franchise and the property and rights acquired thereunder to any person or corporation: Provided, That in case of any national emergency affecting and endangering the public safety and order, to Government of the Philippines shall have the right to take possession of the water supply system as provided in this Act, and operate the same until such emergency shall have passed.

SEC. 7, The Public Service Commission or its legal successor, after hearing the interested parties, upon notice and order in writing, shall have the power to declare forfeiture of this franchise and all rights inherent in the same for failure on the part of the grantee to comply with any of the terms and conditions thereof, unless such failure shall have been directly and primarily caused by the act of God, the public enemy or force majeure. Against such declaration of forfeiture by the Public Service Commission or its legal successor, the grantee may apply for the remedies provided in Sections thirty-five and thirty-six of Commonwealth Act Numbered One hundred forty-six as amended.

SEC. 8. It is expressly provided that in the event the Government should desire to operate ,and maintain for itself the water system herein authorized, the grantee shall surrender his franchise and will turn over to the Government the system and serviceable equipment therein at cost, less reasonable depreciation.

SEC. 9. The franchise herein granted shall be subject to amendment, alteration or repeal by the Congress when the public interest so requires.

SEC. 10. This Act shall take effect upon its approval.

Enacted without the Executive approval, June 17, 1972.