WHEREAS, on September 5, 1991, the Board issued Resolution No. 91-16, Part XI (2) thereof provided that transfer prices authorized therein included, among other things, charges for maintenance of cylinders, including expenses for painting, scraping and requalification of the cylinders and other necessary safety requirements thereof;

WHEREAS, based on industry practice prior to the regulation of the oil industry, a portion of the cost was intended for the proper maintenance of the LPG cylinders;

WHEREAS, before and at the time Resolution No. 91-16 was issued, the independent marketers purchased their LPG products directly from the oil companies or in short, the Board was unaware of business transaction between LPG Refillers and Independent Marketers so that no transfer price between them has been set by the Board;

WHEREAS, because of the complaints received by the Department of Energy (DOE) and the Energy Regulatory Board (ERB), it has come to the attention of the Board that there is business transaction between the LPG Refillers and Independent Marketers so that the issue of who should benefit from the maintenance cost and who should maintain the LPG cylinders should be addressed;

WHEREAS to ensure public safety and interest through properly maintained LPG cylinders, it has become imperative on the part of the Board to clarify the issue of maintenance as contained in ERB Resolution No. 91-16;

WHEREAS, the proper maintenance of LPG cylinders will be achieved if the owners thereof are the appropriate persons required to maintain the same;

WHEREFORE, the Board hereby resolves as it is hereby RESOLVED to require LPG cylinder owners to maintain the same as they have been benefitting from the maintenance cost built-in in the transfer prices.

The Department of Energy (DOE) and the oil companies, LPG producers, marketers, refillers, dealers, the Liquefied Petroleum Gas Institute of the Philippines (LPGIP) and the LPG Associations, which are furnished with copies of this Resolution are directed to disseminate the contents of this Resolution within their respective spheres of operation.

This Resolution shall take effect immediately.

Adopted: 01 Dec. 1995

(SGD.) REX V. TANTIONGCO
Chairman

(SGD.) BAYANI V. FAYLONA
(SGD.) ARNALDO P. BALDONADO
(SGD.) EDWARD C. CASTA EDA
Members