FREEZE ORDERS: Effectivity, Remedies and Procedural Safeguards

Recently, the Anti Money Laundering Council (“AMLC”) was able to secure several Freeze
Orders covering the bank accounts and properties of several individuals and entities related
to the highly publicized flood control issue. In light of these recent developments, it is
important to determine the nature of a freeze order as well as the remedies and the
safeguards that we must consider.

A freeze order is an “extraordinary and interim relief” issued by the Court of Appeals, upon
an ex-parte Petition filed by the AMLC, with the goal of preserving the properties related to
an unlawful activity. ^[1]  Since it is merely an interim measure, freeze orders are not permanent
and indefinite. In understanding the temporary nature of the Freeze Order, two (2) periods
must be considered: (i) 20 days and (ii) 6 months.

The 20-day period starts from the time the Court of Appeals issues the Freeze Order. During
the said period, an aggrieved party may file a Motion to Lift the said Freeze Order. Likewise,
within the day 20-period, the Court of Appeals will determine whether the Freeze Order
should be extended for a maximum period of six (6) months. These issues may be discussed
and resolved during the summary hearing, which must also be conducted during the 20-day
period.

Generally, after the non-extendible period of six (6) months, the Freeze Order shall be ipso
facto lifted if no case was filed against the person whose accounts or properties were frozen.^[2]
Thus, during the six (6) month period it is possible that a case for civil forfeiture case may be
filed against the owner of the accounts and properties covered by the Freeze Order. ^[3] The
civil forfeiture case is an entirely separate legal proceeding which is more focused on seizing
the money or property related to the unlawful activity, as compared to the cases on Freeze
Order, which is more for the preservation of the said money or property.

So what is the effect if the person’s bank accounts and properties were the subject of a
Freeze Order? Section 55 of Rules of Procedure in Cases of Civil Forfeiture, Asset
Preservation under R.A. 9160, lists the prohibitions if the bank account or property is covered
by a Freeze Order. Specifically for bank accounts, transactions, withdrawals and deposits
cannot be made with the said bank account that was frozen. However, despite the Freeze
Order, reasonable withdrawals may be made for necessities such as monthly family needs
and sustenance, legal fees, and medical needs. ^[4] With regard to properties (i.e. lands, motor
vehicles), these may not be disposed of transferred to a different individual or entity, during
the effectivity of the Freeze Order. Seemingly, the Freeze Order does not automatically mean
that the government will take an individual’s money or property, but it also limits the owner’s
rights over the same.

As previously discussed, an aggrieved owner, whose bank accounts and properties were the
subject of a Freeze Order, may file a Motion to Lift the Freeze Order. The owner may argue

that probable cause does not exist that his bank accounts and properties are in any way
related to the unlawful activity listed in Section 3 (1) of the Anti-Money Laundering Act and
submit evidence to substantiate his claim. However, this poses a challenge to the owner
since he is not furnished with the Petition filed by the AMLC. Under the law, the Freeze Order
proceedings are confidential and the fact of filing the Petition and its contents may not be
disclosed to anyone except to those authorized by the Court of Appeals. ^[5] Thus, he has no
way of knowing the evidence that AMLC has and can only raise his defenses based on the
allegations stated in the Freeze Order/Resolution of the Court of Appeals.

Apart from filing the said Motion, the owner is also given an opportunity to attend the
summary hearing, where he can further argue for the lifting of the Freeze Order and oppose
its extension. Further, the owner may also file a Petition for Review on Certiorari, under Rule
45 of the Rules of Court before the Supreme Court. ^[6]

While the rules on the issuance of a Freeze Order may seem unfavorable to the owner
whose properties were frozen, it is not without procedural safeguards. The Supreme Court
en banc recently provided several guidelines in relation to the application and implantation of
Freeze Orders:

1. 1. 1. 1. The AMLC shall file an ex parte petition before the CA to
            freeze any monetary instrument or property that is in any way
            related to an unlawful activity. The AMLC must describe with
            particularity the accounts specifically enumerated in the ex parte
            application, including the amounts contained therein. The ex parte
            petition shall state if it includes related and materially-linked
            accounts as defined under the 2018 IRR of the AMLA.
            2. The CA independently makes a finding of probable cause that
            a monetary instrument or property, including the related and
            materially linked accounts, is in any way related to an unlawful
            activity as defined under the AMLA.
            3. The freeze order shall be limited only to the amount of cash or
            monetary instrument or value of property that the court finds
            probable cause so as to be considered as proceeds of a
            predicate offense and it shall not apply to amounts in the same
            account in excess of the amount or value of the proceeds of the
            predicate offense.
            4. The freeze order shall be effective immediately for a period of
            20 days. During this period, the CA must conduct a summary
            hearing, with notice to the parties, to determine whether or not to
            modify or lift the freeze order or extend its effectivity, which should
            not exceed six months.
            5. A person whose account has been frozen may file a motion to
            lift the freeze order and the court must resolve this motion before
            the expiration of the freeze order.
            6. If there is no case filed against a person whose account has
            been frozen within the period determined by the CA, which in no
            case shall not exceed six months, the freeze order shall be
            deemed ipso facto lifted.
            7. The person whose property or funds have been frozen may
            withdraw such sums as the AMLC determines to be reasonably
            needed for monthly family needs and sustenance, including the
            services of counsel and the family medical needs of such
            person.” ^[7]

Our laws and jurisprudence recognizes the need to protect and preserve the money and
properties that are related to unlawful activities. However, this should not be exercised
arbitrarily and effectively go against the rights which our constitution seeks to protect.

[1] Yambao v. Republic of the Philippines, G.R. No. 171054, 26 January 2021.
[2] Managip et al., v. Republic of the Philippines and AMLC, Powerlink Corp. v. Republic of the Philippines
and AMLC, OMNI Security Investigation Inc. et al., v. Republic of the Philippines, G.R. Nos. 222312,
222313, 22314, 20 May 2025.
[3] Ligot v. Republic of the Philippines and AMLC, G.R. No. 176944, 6 March 2013.
[4] Supra note 2.
[5] RULES OF PROCEDURE IN CASES OF CIVIL FORFEITURE, ASSET PRESERVATION UNDER R.A.
9160, §49.
[6] Ibid at §57.
[7] Supra note 2.