Presidential Decree No. 252




M a n i l a

PRESIDENTIAL DECREE No. 252 July 21, 1973


WHEREAS, sustained national economic growth calls for a secure position in the growing world market for international trade;

WHEREAS, efforts at strengthening the external trade sector have been weakened by the continued inability to provide an organized body that can take advantage of economies of scale in bulk purchases, widescale shipping, marketing, centralized financing assistance and other export promotions services:

WHEREAS, existing trade assistance bodies in the private sector continue to operate on a small scale for a limited number of export products without regard to a larger rationalization of the national export industry called for by the national development program;

WHEREAS, while previous attempts have been made to provide a central body in aid of international trading for local producers, these bodies have not achieved their primary objectives by reason of their limited operations or other basic defects or weaknesses in their conception or organization;

WHEREAS, while developed economies have long relied on large trading houses, our economy has yet to adopt and benefit from such a trade assistance scheme; (As amended by P.D. No. 349.)

WHEREAS, developing economies, especially within the neighboring Southeast Asian region, that have established government trade Companies have acquired a significant advantage over Philippine trade in the world market;

WHEREAS, in view of the latest trends in the international market, it is imperative that the Philippines be sufficiently supported by such institutions and/or agencies that can endow her with the needed Competitive Capacity;

WHEREAS, such an institution is a government- controlled international trading corporation that shall derive support and patronage from industry groups, warehouse/port facility owners, insurance companies, investment banks, commercial banks and individual exporters and importers;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution, as Commander-in-Chief of all the Armed Forces of the Philippines, in recognition of the foregoing premises, do hereby order and decree into law the following:

Title of this Decree

This Decree shall be known as the Philippine International Trading Corporation Law.

Creation of a Philippine InternationalTrading Corporation

There is hereby created a body corporate and politic to be known as the Philippine International Trading Corporation, hereinafter referred to as the Corporation, which shall have its principal place of business in the City of Manila and shall exist for a period of fifty years.

The initial authorized capital stock of the Corporation shall be twenty million (P20,000,000.00) pesos and shall be subscribed and paid up as follows:

(a) 60 per centum thereof or twelve million (P12,000,000.00) pesos shall be subscribed by the Republic of the Philippines and shall be paid for as follows:

(1) The amount of six million (P6,000,000.00) pesos shall be paid by the Republic of the Philippines. The Sum of six million (P6,000,000.00) pesos is hereby set aside and appropriated for the purpose from the proceeds of the General Fund not otherwise appropriated.

(2) The amount of six million (P6,000,000.00) pesos shall be paid in three equal parts by the following government financial institutions:

Central Bank of the Philippines two million (P2,000,000.) pesos.

Philippine National Bank two million (P2,000,000.00) pesos.

(b) 40 per centum thereof, or eight million (P8,000,000.00) pesos shall be offered for subscription and payment to the public, subject to the following conditions:

1. That the shares of stock shall be sold at not less than the uniform par value of one hundred (P100.00) pesos.

2. That such disposition of shares of stock shall result in the equal distribution thereof, among individuals or organized traders representing specific industries or products, without anyone stockholder owning more than 5 per centum of the 40 per centum of the authorized capital stock.

Each share of stock shall represent one vote and any agreement, contract, arrangement, scheme or plan that shall transfer voting rights to any person other than the stockholder is prohibited.

The voting power of all the stock of the Corporation owned and controlled by the Republic of the Philippines shall be vested in the President of the Philippines, or in such person or persons as he may from time to time designate.

Purposes and Powers of the Corporation

The Corporation is hereby vested with the following purposes and powers:

Section 1. To Provide a formal institutional framework for the promotion of foreign trade and the development of domestic industries by carrying on the following interrelated functions and activities:

(a) engaging in and handling for Philippine and third country enterprises, through methodologies, systems, devices, and facilities intended to achieve economies of scale and better terms of trade for Philippine businesses, both foreign procurement as well as foreign marketing and distribution;

(b) arranging for or establishing comprehensive facilities for handling all phases of warehousing, and developing and operating physical facilities for the collection, processing and distribution of cargoes and other commodities;

(c) obtaining or arranging more comprehensive protection for activities undertaken or commodities dealt with by the Corporation by monitoring or coordinating risk insurance services from existing institutions or supplementing the same;

(d) employing, utilizing, monitoring trade promotions services, facilities and activities that are available or are being undertaken by other government or private agencies;

(e) promoting, organizing and reorganizing, whenever warranted, production enterprises and industrial establishments, and collaborating and associating in joint ventures with any person, association, company or entity, whether domestic or foreign, in the fields of production, marketing, procurement and such other related businesses; and

(f) providing technical, advisory, investigatory, consultancy and management services with respect to any and all of the foregoing functions, activities and operations of the Corporation.

Sec. 2. To engage in and carry on the business of dealership, brokerage, manufacture and distribution of commodities, products, goods, wares, merchandise, machineries and equipment and in connection therewith, to purchase, borrow, acquire, hold, exchange, sell, distribute, lend, mortgage, pledge or otherwise dispose of, import or export, process, or turn to account in any lawful manner, commodities, products, goods, wares, merchandise, and other articles or commerce and interest therein or instruments evidencing rights to acquire such interests and to guarantee any and all obligations relating to transactions made on any board of trade, commodities exchange, or similar institutions, and to do any and all things which may be useful in connection with or incidental to the conduct of such business.

Sec. 3. To build, make, construct, maintain, purchase, sell, charter, deal in and with, own, lease, pledge and otherwise dispose of all modes of transportation, together with all components, tools, machinery and appliances appurtenant thereto, as are utilized in the transport of goods and merchandise by air, land or sea.

Sec. 4. To carry on the business of public and private warehousing and all the business necessarily or impliedly incidental thereto, and to further carry on the business of general warehousing in all its several aspects; to construct, hire, purchase, operate and maintain any means or conveyances for the transportation to and from storages, by air, land, or water, of any and all products, goods, wares, merchandise or manufactured articles; to issue certificates, warrants and receipts, negotiable or otherwise, to persons warehousing goods with the Corporation, and to make, negotiate or secure advances or loans upon the security of such stored merchandise and products or otherwise; to construct, purchase, take on lease, develop, operate or otherwise acquire any wharf, pier, dock, warehouse, storage room or other facilities, rights, franchises premises deemed capable of being advantageously used in connection with the business of the Corporation, and to rent, lease, hypothecate and convey the same, and generally to carry on and undertake any and all business undertaking, transaction or operation commonly carried on or undertaken by warehousemen.

Sec. 5. To act as shipping agent and ship broker, to handle ship husbanding and ship chandlering, and to engage in any aspect of the business of longshoring, lighterage, stevedoring, freight forwarding, packing and carting, and covenying.

Sec. 6. To borrow, raise, or obtain funds to support or carry out its objects and purposes and/or to arrange financing or equipment credit or any kind of financial or material assistance for its own account or its clients from private or governmental sources or from international public or private lending institutions and to secure any or all of the same, to the extent that may be required, by any lawful guarantee or counter guarantee, by pledge, mortgage, or deed of trust, or by creating or suffering to exist a charge, lien, or encumbrance, general or special, upon its revenues and/or assets, and likewise by similar guarantees, pledges, mortgages, liens and other security arrangements to secure the performance by the Corporation of any obligation or liability it may undertake for itself or for other companies or enterprises in which it may be interested.

Sec. 7. To provide financial accomodations to its clients, and maintain with or for customers accounts with respect to commodities and/or securities including margin accounts and to do such things as may be requisite or appropriate or incidental to the maintenance of such accounts.

Sec. 8. To act as agents or brokers in the business of marine, fire, life, accident and fidelity insurance, in the business of giving protection to principals and employers and any other kind or class of insurance in all its branches.

Sec. 9. To establish, maintain, operate or conduct branch businesses or offices for the transaction of business for itself and on behalf of other persons, firms, corporations, or other entities, either domestic or foreign, and to act as manufacturers' agents, commission merchants, merchandise brokers, insurance, shipping and transport agents, or in any other representative capacity for persons, firms, corporations or other entities, either domestic or foreign, for the investment, loan payment, transmission or collection of money, commodities or securities and for the purchase, sale, improvement, development, and management of property including business concerns and undertakings and generally to transact and undertake an agency business, whether in respect of any commercial or financial matters.

Section 10. To undertake or contract for researches, studies and surveys on such matters as business and economic conditions of various countries, including the structure of their commodities and financial markets, the institutional arrangements for mobilizing investments thereat, the legal and tax constraints and incentives obtaining therein; to promote products overseas through holding of trade fairs, exhibits and the like, coordinating with the Department of Trade in undertaking such activities.

Section 11. To acquire an interest in or enter into partnership, amalgamate with or enter into other arrangements for sharing profits, mutual assistance or cooperation with any person or company carrying on or about or carry or engage in any business transaction, operation or work capable of being conducted so as to purchase, take or otherwise acquire and hold shares of stock or other securities of or interest in any such company and to sell, hold and re-issue with or without guarantee or otherwise deal with the same.

Section 12. Subject to the limitations established by law, to acquire by purchase, subscription, exchange, assignment, gift, or otherwise, and to sell, assign, transfer, exchange, mortgage, pledge, and deal in and with, and otherwise, to enjoy and dispose of, and bonds, debentures, promissory notes, shares of capital stock and/or other securities and/or obligations, created, negotiated or issued by any corporation, association, or other entity, foreign or domestic, and while the owner thereof, to exercise all the rights, power and privileges of ownership, including the right to receive, collect and dispose of, any and all dividends, interest and income, derived therefrom, and the right to vote on any shares of the capital stock, and upon any bonds, debentures and/or other securities, having voting power so owned.

Section 13. To cause or allow the legal title to or any legal or equitable interest in any business or any other real or personal property acquired or carried on by the Corporation to remain or be vested or registered in the name of any other person or entity whether upon trust for or as agent or nominee of the Corporation or upon such other terms and conditions which may be determined to be necessary or expedient by the Board of Directors of the Corporation.

Section 14. To acquire any purchase or lease, or otherwise, lands and interest in lands and to own, hold, improve, develop and manage any real estate so acquired and to erect or cause to be erected on any lands owned, held or occupied by the Corporation, buildings or other structures with their appurtenances, and to rebuild, enlarge, alter or improve any buildings or other structures now or hereafter erected on any lands so owned, held or occupied.

Section 15. To purchase, own, hold, or otherwise acquire such machineries, equipments, tools, materials, supplies, or other parts as may be necessary, convenient or appropriate for any of the purposes for which the Corporation is formed.

Section 16. To invest and deal with the funds of the Corporation in such manner as may be deemed proper, in order not to make such funds idle and unproductive pending their full utilization for the principal objects and purposes for which the Corporation has been organized.

Section 17. To apply for, register, purchase or otherwise acquire, or obtain a lien, or interest in, any patent, patent rights, licenses, designs, processes, trademarks, tradenames, distinctive marks, inventions and improvements thereof, and concessions which may appear likely to be advantageous or useful to the Corporation or its clients; to use, exercise or otherwise turn to account said property rights, and to enter into any patent licensing, technical assistance, or other know how and data or process feedback agreements, including the use of computers, as the same may be related to or necessary or appropriate to carry on the objects and purposes of the corporation.

Section 18. To pay for any property or rights acquired or services obtained by the Corporation either in cash, shares, or other securities of the Corporation, or partly in cash and partly in shares or other securities, under such terms and conditions as its Board of Directors shall determine to be reasonable. To enter into any agreement or contract or contract with any government or any of the agencies and instrumentalities thereof, or with any person or company on any undertaking that may be conducive to the attainment of objectives of the Corporation or of any them, and to obtain from any such government or authority, person or company any rights, privileges, and concessions, which the Corporation may think desirable to obtain and carry out.

Section 19. To do all such other things as are incidental or appurtenant to or growing out of or connected with the aforesaid business or powers of the Corporation or any part thereof or conducive to the attainment of its corporate purposes and objects.

Board of Directors

Section 1. The powers and functions of the Corporation shall be exercised by a Board of Directors which shall be composed of thirteen (13) members, as follows:

a. The Secretary of the Department of Trade, who shall preside at the meetings of the Board. Whenever the Secretary of the Department of Trade is unable to attend a meeting of the Board, the Undersecretary of Trade shall act as his alternate, but shall not preside.

b. The President of the Corporation, who shall preside at the meetings of the Board in the absence of the Secretary of Trade. The President shall be appointed for a term of two (2) years, renewable indefinitely, by the President of the Philippines subject to the provisions of Article XIV of this decree. Whenever the President is unable to attend a meeting of the Board, the Vice President shall act in his stead.

c. The Executive Secretary

d. The Director-General of the National Economic and Development Authority.

e. The Secretary of Agriculture and Natural Resources.

f. The President of the Philippine National Bank.

g. The Chairman of the Board Governors of the Development Bank of the Philippines.

h. Six (6) other members, to be appointed for terms of five (5) years by the President: Provided, however, That the first members appointed under the provisions of this subsection shall have terms of office of one, two and three years for every two members.

In making the appointments to the Board, the President of the Philippines shall give due regard to affording fair representation of the private financial, agricultural, industrial and commercial interests, in the composition of said Board.

Sec. 2. Vacancies. Any vacancy in the Board by the death, resignation, or removal of an appointive member shall be filled by the appointment of a new member to complete the unexpired period of the term of the member concerned.

Sec. 3. Qualifications. No person shall be appointed as President, Vice-President of the Corporation or as member of the Board unless he is a Filipino citizen, of good moral character and unquestionable integrity and responsibility and who is reputed to have considerable experience in foreign trading operations.

Sec. 4. Removal. The President may remove any members of the Board for any of the following reasons:

a. If the member is guilty of acts or operations which are of fraudulent or illegal character or which are manifestly opposed to the aims and interests of the Corporation, or

b. If the member no longer possesses the qualifications specified in Sec. 3 hereof.

Sec. 5. Remuneration. The members of the Board or their respective substitutes, except the President of the Corporation, shall receive per diems for every Board meeting attended. The amount of said per diem shall not exceed the sum of seven hundred (P700.00) pesos for any single month.

Sec. 6. Responsibility. Any member of the Board or officer or employee of the Corporation who wilfully violates this Act or corporate by-laws or who is guilty of gross negligence in the performance of his duties shall be held liable for any loss or injury suffered by the Corporation as a result of such violation of negligence. Similar responsibility shall apply to the disclosure of any information of a confidential nature about the discussions or resolutions of the Board or about the operations of the Corporation, and to the use of such information for personal gain or to the detriment of the government, the Corporation or third parties.

Sec. 7. Powers and Functions of the Board.

a. To adopt corporate by-laws in supplement to this Decree.

b. To determine specific commodities, industries or any particular sector of the export and import trade that shall utilize the services of the Corporation to the exclusion of any other entity or similar trading houses.

In determining such specific commodities, industries or particular sector, the Board shall be guided by the expressed objectives of this Decree (and by Sec. 5 of Article III).

In all cases, such a determination shall be subject to the approval of the Board of the National Economic and Development Authority.

c. To establish the policies for determining fees and charges for the services rendered by the Corporation.

d. To approve appointments of the President to senior management level positions in the Corporation;

e. To create such other Departments in the Corporation than those provided in this Decree, whenever such Departments are required by the expanding operations of the Corporation;

f. To fix the remunerations or salaries of all officials and employees of the Corporation except that of the President.

g. To determine and approve the most effective organizational framework, staffing pattern and salary schedule as may be proposed by the President to the Board; and establish rules and regulations regarding the delegation of administrative responsibilities, and directions for organizational growth.

h. To do all such acts or acts as may be necessary for the achievement of the expressed purposes of the Corporation.

The President and Vice-President

Section 1. Powers and Duties of the President. The President shall be the chief executive of the Corporation. His powers and duties shall be:

a. To prepare the agenda for the meeting of the Board and to submit for the consideration of the Board the policies and measures which he believes to be necessary to carry out the purposes and provisions of this Decree;

b. To execute and administer the policies and measures approved by the Board;

c. To direct and supervise the operations and internal administration of the Corporation. The President may delegate certain of his administrative responsibilities to other officers of the Corporation subject to the rules and regulations of the Board; and

d. To exercise such other powers as may be vested in him by the Board.

Sec. 2. Representation of the Board and the Corporation. The President of the Corporation shall be the principal representative of the Board and of the Corporation and in his capacity and in accordance with the instructions of the Board, he shall be empowered:

a. To represent the Board and the Corporation in all dealings with other offices, agencies and instrumentalities of the Government and with all other persons or entities, public or private whether domestic, foreign or international;

b. To authorize, with his signature, contracts concluded by the Corporation, notes and securities issued by the Corporation and the annual reports, balance sheets, profit and loss statements, correspondence and other documents of the Corporation;

c. To represent the Corporation, either personally or through counsel, in any legal proceedings or action; and

d. To delegate his power to represent the Corporation as provided in subsections (a), (b) and (c) of this section, to other offices of the Corporation upon his own responsibility.

Sec. 3. Authority of the President in Emergencies. In the event of war other emergencies which require immediate action and in which there is insufficient time to call a meeting of the Board, the President of the Corporation, with the concurrence of the Governor of the Central Bank, or in his absence, with the concurrence of any two other members of the Board, may decide any matter or take any action within the authority of the Board itself and may suspend any resolution or decision of the Board.

In such cases, the President shall call a meeting of the Board as soon as possible in order to explain his action and the reasons for departing from normal procedure. The Board may then confirm, revoke or modify such action as the circumstances warrant.

Sec. 4. Remuneration of the President. The salary of the President and Vice-President of the Corporation shall be fixed by Board with the approval of the President of the Philippines, but in no case shall it exceed seventy thousand pesos per annum and sixty thousand pesos per annum, respectively, until such a time as another law revised these upper limits.

Sec. 5. In the absence of the President of the Corporation, the Vice President shall act as chief executive of the Corporation shall exercise the powers and perform the duties of the President.

Sec. 6. Outside Interests of the President and Vice President. The President and Vice President of the Corporation shall be required to limit their professional activities to those pertaining directly to their positions with the Corporation. Accordingly, both officials may not accept any other employment, whether public or private, or any renumeration therefor.

Departments of the Corporation

Section 1. Department of trade Services. The Corporation shall establish and maintain a Department of Trade Services which shall be responsible for providing centralized procurement and marketing services with the objective of consolidating or pooling imports and exports and thereby achieving improved term of trade through economies of scale and greater bargaining power.

Sec. 2. Department of Shipping, Collection, Distribution and Storage Services. The Corporation shall establish and maintain a Department of Shipping, Collection, Distribution and Storage Services that shall be responsible for pooling incoming and outgoing cargoes into economic lot sizes with the objective of securing lower freight rates through volume shipping, lower costs through improved collection and distribution networks and programming.

The Department shall likewise provide for efficient collection, storage and distribution system by acting as customs broker, forwarding agent, or by hiring, leasing, developing and operating the necessary physical facilities for loading and unloading, warehouses, and others.

Sec. 3. Department of Promotions and Marketing Services. The Corporation shall establish and maintain a Department of Promotions and Marketing Services that shall supplement, assist or coordinate with other existing government departments, bodies, agencies or offices towards the development of new markets and the strengthening of competitiveness in traditional markets for existing exports, seeking new markets for new exports, and developing new products to meet expected market demands.

Sec. 4. The Department of Trade Financing Service. The Corporation shall establish and maintain a Department of Trade Financing Service that shall provide or arrange for financing assistance to producers, exporters, importers and suppliers. Services may include direct capital investments working capital or inventory financing or the monitoring and soliciting of financial services from existing private and public institutions.

Sec. 5. Other Departments. The Board of Directors shall, when the expanding capabilities of the Corporation so warrant, establish such other Departments as would enable the Corporation to achieve its declared objectives.

The Auditor

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

The auditor must be a certified public accountant with at least ten years experience as certified public accountant. No relative of any member of the Board of Directors or the Chairman of the Commission on Audit within the fourth degree of consanguinity and affinity shall be appointed as such representative.

Annual Report

Before the end of February of each year, the Corporation shall submit to the President of the Philippines and shall publish an annual report on the condition of the Bank and a review of the policies and measures adopted by the Board during the past year and an analysis of the economic and financial circumstances which gave rise to said policies and measures.

The annual report shall also include a statement of the financial conditions of the Corporation.

Corporate Profits and Losses

Section 1. Profits. At the close of each calendar year, the Corporation shall determine the net result of its operations, in the calculation of which, adequate allowances shall be made for probable losses. The net profit arrived thereat shall be accumulated in the surplus account which shall be utilized in pursuance of corporate objectives as may be authorized by the Board of Directors: Provided, however, That the accumulated surplus shall not exceed the authorized capital stock.

Sec. 2. Should the Corporation gain net losses during any calendar year, such losses shall be debited to surplus, and if surplus be inadequate, the balance shall be debited to the capital of the Corporation.

Disposition of Profits Assigned to Shares

Sixty (60) percent of the profits assigned to the shares of the Republic of the Philippines shall be expended for the expressed objectives of the Corporation.

Forty (40) percent thereof shall be paid into the Treasury of the Philippines for the general funds thereof.

Applicability of the Civil Service Law and Wage and Position Classification Law

The provisions of the Civil Service Law and the Wage and Position Classification Law shall not apply to the appointment and compensation any officer of employee of the corporation.

Officers and employees in the Corporation, including all members of the Board of Directors shall not engage directly or indirectly in partisan activities or take part in any election except to vote.


Any director, officer, employee or agent of the Corporation, who violates or permits the violation of any of the provisions of this Decree, or any person who violates or aids in or abets the violation of any of the provisions of this Decree shall be punished by a fine not to exceed ten thousand pesos or by imprisonment of not more than five years or both such fine and imprisonment.

Repealing Clause

All acts, decree, rules, regulations and other official issuances or parts thereof, inconsistent or incompatible both the provisions of this Decree are hereby repealed.

Transitory Provisions

Owing to practical exigencies of organizing a corporation of this magnitude and because of the sensitivity of the initial operating years, the first President of the Corporation shall enjoy a tenure of 3-year, which is renewable subsequently for tenure of only 2-year as provided for in Sec. 7, Article IV of this Decree.

Effectivity and Implementation

This Decree shall take effect upon its approval. The Secretary of the Department of Trade in his capacity as presiding officer of the Board of Directors shall call for an organizational meeting of the Board within fifteen (15) days from the time all the appointive members thereof are appointed by the President of the Philippines.

Done in the City of Manila, this 21st day of July, in the year of Our Lord, nineteen hundred and seventy-three.

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