Anti-Terrorism Financing and National Security in the Philippines: A Comprehensive Legal Overview (as of 1 July 2025)

Abstract

Terrorism financing (“TF”) is the provision, collection or movement of funds—regardless of source—intended to be used, in whole or in part, to carry out terrorist acts or to benefit terrorist individuals or organizations.1 In the Philippines the fight against TF sits at the intersection of two constitutional imperatives: the maintenance of national security (Art. II, §5, 1987 Constitution) and the protection of civil liberties. Since 2001 the legal architecture has expanded from traditional anti-money-laundering tools to a dedicated regime that aligns the country with UN Security Council resolutions (UNSCR 1267/1373 et seq.) and Financial Action Task Force (“FATF”) standards. This article surveys all major laws, regulations, institutions, jurisprudence, policies and emerging issues relevant to TF and security up to June 2025.

I. Conceptual Foundations

Terrorism	Terrorism Financing	National Security
Violent acts intended to sow intimidation or destabilize the political, economic or social order (R.A. 11479 §4).	Provision, collection, or making available of funds, directly or indirectly, knowing or intending that they be used to carry out terrorism or by a terrorist or terrorist organization (R.A. 10168 §4; R.A. 11479 §12–§13).	Freedom from internal and external threats to the sovereignty, territorial integrity, and way of life of Filipinos (National Security Strategy 2023-2028).

The Philippine framework applies a “dual-definitional” approach: TF is a stand-alone felony (R.A. 10168) and a predicate offense to money-laundering (R.A. 9160, as amended).

II. International Normative Framework

UN Security Council Resolutions – UNSCR 1373 (2001) mandates criminalisation of TF; UNSCR 1267/1989/2253 impose targeted financial sanctions (“TFS”) against Al-Qaida, ISIL and affiliates.
FATF Recommendations – The Philippines has been under enhanced monitoring (“grey list”) since June 2021 for residual deficiencies in beneficial-ownership transparency, casino supervision, and TF prosecution.
ASEAN & APEC cooperation – ASEAN Convention on Counter-Terrorism (2007) and the ASEAN Plan of Action (2023-2027) commit members to reciprocal freezing, intelligence-sharing and mutual legal assistance.

III. Domestic Legislative Architecture

A. Anti-Money Laundering Statutes

Law	Salient TF-related Amendments
R.A. 9160 (2001) – AMLA	Established the Anti-Money Laundering Council (AMLC) as the financial-intelligence unit (“FIU”).
R.A. 9194 (2003)	Expanded subpoena & freeze powers.
R.A. 10365 (2013)	Defined covered and suspicious transactions; included DNFBPs.
R.A. 10927 (2017)	Brought casinos under AML/CFT supervision.
R.A. 11521 (2021)	Introduced targeted financial sanctions (TFS) and power to issue ex-parte freeze orders tied to UNSCR/FATF designations within 24 hours.

B. Dedicated TF Statute

R.A. 10168 (2012) – “Terrorism Financing Prevention and Suppression Act”

Creates stand-alone crime of TF; penalties: reclusion temporal to reclusion perpetua and ₱500 k–₱1 M fine.
Civil forfeiture and asset management regime.
Gives AMLC authority to issue freeze orders ex parte subject to Court of Appeals confirmation within 20 days (further governed by Supreme Court A.M. 21-02-04-SC Rules).

C. Anti-Terrorism Act

R.A. 11479 (2020) – “Anti-Terrorism Act” (“ATA”)

Repealed the Human Security Act (2007).
Section 25 allows the Anti-Terrorism Council (ATC) to designate individuals or groups, triggering automatic asset-freeze by AMLC.
Section 29 authorizes custodial detention of suspects up to 24 days without judicial warrant—raising civil-liberties concerns.
Supreme Court rulings: Republic v. Drilon (G.R. 252578 et al., 14 Dec 2021) partially struck down the second paragraph of §25 (‘request of foreign jurisdiction’) for over-breadth; all other provisions on TF and asset-freeze were upheld. Further challenges in Pangilinan v. Executive Sec. (consolidated cases, pending 2025).

D. Complementary Statutes & Rules

R.A. 11934 (2022) – SIM Registration Act – limits anonymous digital wallets, closing an avenue for TF via prepaid SIM-based e-money.
R.A. 11959 (2023) – Anti-Financial Account Scamming Act – criminalises mule accounts often exploited for TF layering.
BSP Circulars 1108 (2021) & 1122 (2022) – impose TF risk assessments on Virtual Asset Service Providers (“VASPs”).
SEC Memorandum Circular 1-2021 – mandates beneficial-ownership registers for corporations.

IV. Institutional Architecture

Entity	Mandate vis-à-vis TF
Anti-Terrorism Council (ATC)	Policy-making and designation body (Exec. Order #138-A [2022] clarified inter-agency roles).
Anti-Money Laundering Council (AMLC)	FIU; freeze, forfeiture and financial-intelligence lead; member of the Egmont Group.
Bangko Sentral ng Pilipinas (BSP)	Supervises banks, NBFIs, EMIs, VASPs.
Securities & Exchange Commission (SEC)	Supervises covered DNFBPs (law firms, accounting, real-estate brokers) for TF compliance.
Insurance Commission (IC)	Ensures insurers/insurance brokers implement CFT controls.
National Intelligence Coordinating Agency (NICA)	Fusion center for intelligence on TF threats.
Armed Forces of the Philippines (AFP) & Philippine National Police (PNP)-Anti-Kidnapping/Terrorism Groups	Operational disruption, investigation and arrest.
Department of Foreign Affairs (DFA)	UNSC listing coordination and mutual legal assistance.

V. Preventive, Detection & Reporting Measures

Know-Your-Customer (KYC) and Customer Due Diligence (CDD)
- Mandatory ID verification; enhanced CDD for high-risk (e.g., NGOs active in conflict zones).
Suspicious Transaction Reports (STRs) & Covered Transaction Reports (CTRs)
- 24-hour reporting to AMLC for red-flag transactions ≥ ₱500 000 in cash or ₱1 M in other instruments.
Targeted Financial Sanctions (TFS)
- Immediate freeze (without prior notice) of assets of UNSC-listed or ATC-designated persons for 20 days; Court of Appeals may extend to 6 months or order forfeiture.
Cross-Border Declaration
- Travelers must declare currency/monetary instruments > US$10 000; seized items may be reverse-engineered for TF links.
Casinos & Gaming
- Real-time monitoring of high-value junket & e-gaming transactions; Chip-to-chip transfer record-keeping.
Virtual Assets
- VASPs required to register with BSP; travel-rule implementation for transfers ≥ US$1 000.

VI. Investigation, Prosecution & Adjudication

A. Surveillance & Intercepts

ATA §16–§19 allow court-authorized wiretaps for TF; maximum 90 days renewable.
Real-time collection of metadata from telcos (SIM Reg Act).

B. Asset Preservation & Seizure

Ex-parte Freeze Orders issued by AMLC; validated within 24 hours by CA; contestable but burden on respondent.
Civil Forfeiture (R.A. 10168 §11) independent of criminal conviction; Supreme Court upheld constitutionality in People v. Silongan (G.R. 243654, 2022).

C. Specialized Prosecution

Department of Justice – Anti-Terrorism Division; designated TF courts (e.g., RTC Branch 70, Taguig).

D. Sentencing & Penalties

Offense	Penalty
TF (R.A. 10168 §4)	Reclusion temporal to reclusion perpetua + ₱500k–₱1 M fine; juridical entities: dissolution & ₱10 M fine.
Failure to report (FI officers)	6 mos–4 yrs + ₱100k–₱500k.
Breach of AMLC confidentiality	3 yrs + ₱150k fine.

E. Landmark Convictions

People v. Talay (RTC Zamboanga, 12 Jan 2023) – first conviction for TF via hawala channels supporting Abu Sayyaf.
People v. Galvez (RTC Taguig, 24 Nov 2024) – TF through cryptocurrency to Dawlah Islamiyah; digital forensics central.

VII. Human-Rights and Constitutional Balance

Overbreadth & Vagueness – The 2021 Supreme Court partial invalidation of §25’s “request by foreign jurisdiction” clause underscores the need for strict construction of TF-triggering designations.
Preventive Detention (24-day rule) – Criticised by UN special rapporteurs; Senate bills (S.B. 2474 & 2681) filed 2024 propose judicial oversight within 48 hours.
Red-Tagging & NGO Chill – AMLC’s 2022 Advisory 6 treats some humanitarian NGOs as high-risk, prompting civil-society petitions for clearer risk-based criteria.

VIII. FATF Mutual Evaluation & Grey-List Status

Key Immediate Outcomes (IO)	2023–2024 Progress	Remaining Gaps (mid-2025)
IO-8 (TF Investigations & Prosecutions)	8 indictments; 4 convictions secured.	Limited resources outside Metro Manila.
IO-9 (TFS Implementation)	Launch of online UNSCR /TFS search portal; median freeze order issuance 4 hours.	Low awareness among smaller rural banks & cooperatives.
IO-10/11 (PF TFS)	Alignment with UNSCR 1718/2231 (DPRK/Iran).	Beneficial-ownership verification lags; legislation pending for non-profit sector oversight.

A FATF on-site visit tentatively scheduled for Q4 2025 will decide on potential de-listing.

IX. National Security Policy Integration

National Security Strategy (NSS) 2023-2028 names TF disruption a Priority Program #2 under “Shield the Republic.”
National Action Plan on Preventing and Countering Violent Extremism (NAP-PCVE) 2021-2025 adopts “whole-of-nation” and “whole-of-society” approaches, linking financial-investigation units with community-based rehabilitation.
Executive Order 37-A (2024) institutionalises Joint Terrorism Financing Task Force (JTFTF)—AMLC, ATC-Program Management Center, NICA, DOJ, BSP and SEC—for rapid response to imminent TF threats.

X. Emerging & Future Challenges

Cryptocurrency-enabled Micro-donations – Encrypted peer-to-peer wallets circumvent KYC; BSP exploring blockchain analytics alliance.
Crowdfunding Platforms & Gaming Skins – Online fundraising for “charitable fronts”; AMLC looking at regulation of in-game asset markets.
Trade-Based TF – Undervaluation of agricultural imports; Bureau of Customs–AMLC joint typology study (2024).
“Lone-Actor” Self-Financing – Minimal financial footprint complicates detection; promotes integration of behavioural threat assessment with financial data.
Climate-induced Displacement & TF – Illicit financial flows piggy-backing on humanitarian aid to conflict-affected areas in Bangsamoro.

XI. Comparative & Regional Perspective

Indonesia – 2018 Law 9 includes cash courier criminalisation; cooperative training with AMLC via BI-PPATK.
Malaysia – 2024 NFCC Act created single-agency FIU-Intelligence model cited by Philippine Senate Bills as template.
Singapore – STR turnaround time of 1 day; lessons for AMLC’s digitisation project (Phase II 2025).

XII. Recommendations

Area	Immediate Action (0-12 mos)	Medium-Term (1-3 yrs)
Beneficial Ownership Transparency	Enact BO Law (House Bill 7278) requiring live register & sanctions for false filings.	Integrate BO database with Land Registry & PSA civil registry using API.
Non-Profit Sector Oversight	Finalize risk-based guidelines for NPOs with multi-stakeholder input to avoid over-regulation.	Develop tiered accreditation & self-assessment portal.
Crypto-assets	Issue BSP Circular on Decentralized Finance (DeFi) & mandatory blockchain-analytics integration.	Sandbox a public-private Digital Asset Intelligence Center.
Capacity-building	Double AMLC analysts; create regional FIU hubs (Davao, Cebu).	Incorporate TF-financial-forensics in criminology & accounting curricula.
Human-Rights Safeguards	Mandate judicial review within 72 hours of ATC designation freeze; adopt “sunset clause” review mechanism.	Strengthen Ombudsman oversight of intelligence funds.

XIII. Conclusion

The Philippines has erected a robust yet evolving legal and institutional framework against terrorism financing—anchored on R.A. 10168, R.A. 11479 and successive AMLA amendments—reflecting global standards while contending with unique domestic realities such as long-running insurgencies, archipelagic borders and rapid fintech adoption. The next critical tests will be (1) demonstrating effective implementation sufficient to exit the FATF grey list, and (2) re-balancing security and civil liberties amid emerging technologies and hybrid threats. Vigilant calibration rather than wholesale expansion of powers will ensure that the country’s response to TF remains both constitutionally sound and operationally effective in safeguarding national security.

Disclaimer: This survey is for academic and informational purposes only and does not constitute legal advice.