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8990 bullish on luxury hotels

MASS housing developer 8990 Holdings, Inc. expects to generate P3 billion in recurring revenue from its venture into the luxury hotel business.

In a statement issued Wednesday, the listed property developer said it has 10 new hotels and resorts in the pipeline until 2023. The projects will be undertaken by its newest subsidiary, 8990 Leisure and Resorts.

The newly formed unit’s first development will be the Adama Resort Siquijor, a “super luxury resort” that will offer 250 rooms inside a 20-hectare property. It is scheduled to open in the second half of 2020.

Adama Resort Siquijor will have a central foyer, rooms that maximize the area’s natural light, and cabanas beside the beach.

8990 Leisure and Resorts President Lowell L. Yu said the project will highlight the tourism spots in Siquijor, such as its coral reefs and white sand beaches.

Aside from Siquijor, the company earlier said that it will build Adama resorts in Puerto Princesa, Siargao, Lapu-Lapu City, Baguio, and Boracay.

The company will also launch luxury hotel brand Kura and urban hotel Argo in top tourist destinations such as Palawan, Cebu, Boracay, Davao, Iloilo, Siargao, and Baguio. Some hotels will also be built in Metro Manila.

Prior to establishing 8990 Leisure and Resorts, the company already has experience in the hospitality business with its hotels in Boracay and Baguio under the Azalea brand.

8990 Holdings’ core business is in the development of affordable housing projects. It is currently building the 22-building Urban Deca Homes Ortigas along Ortigas Avenue Extension, which will offer 19,000 units. The project is seen to generate at least P30 billion in sales for the next four to five years.

8990 Holdings saw its net income attributable to the parent rise 18% to P2.82 billion in the first half of 2019, as gross revenues also jumped 17% to P7.01 billion.

Shares in 8990 Holdings slipped 0.26% or four centavos to close at P15.10 each at the stock exchange on Wednesday. — Arra B. Francia

SMC mulls unsolicited proposal for Panay-Guimaras bridge — Drilon

By Emme Rose S. Santiagudo

SAN MIGUEL Corp. (SMC) is interested in investing in Iloilo as it looks to submit an unsolicited proposal for the construction of the bridge that will connect Panay to Guimaras, according to Senator Franklin M. Drilon.

Mr. Drilon said he encouraged SMC President and Chief Operating Officer Ramon S. Ang to invest more in Iloilo following his visit for the groundbreaking of the new production facility of SMC’s subsidiary company, San Miguel Brewery, Inc. (SMB) on Friday at Barangay Gua-an, Leganes, Iloilo.

“I toured Mr. Ang and showed him what are the infrastructure in Iloilo. He was impressed and encouraged to invest here. He is looking at the possibility of an unsolicited proposal for the (Panay-Guimaras) bridge,” Mr. Drilon said in an interview on Friday.

The Panay-Guimaras project, which is estimated to cost around P9 to P14 billion, is expected to be the long-term solution to improve the transport system of the Iloilo-Guimaras route and vice versa.

According to Mr. Drilon, the bridge will start from Barangay Gua-an in Leganes going to Guimaras, and will connect the site of SMB’s Iloilo brewery to other parts of the region.

“I hope that the unsolicited proposal will fast-track the construction [of the] infrastructure,” he said.

Apart from the bridge, Mr. Drilon hopes SMC will also invest and operate the P6.5-billion international airport in Cabatuan, Iloilo.

While Mr. Ang has not yet confirmed the proposed investments, he assured that SMC is willing to invest more in Iloilo.

“Ang SMC puwedeng mag-tayo ng maraming investments, puwedeng (SMC can put up several investments, like a) green terminal or flour mill. Nakita ko very progressive itong Iloilo (I’ve seen how progressive Iloilo is),” Mr. Ang said in his speech on Friday.

Mr. Drilon underscored the need to bring in more investments to Iloilo to provide more jobs and counter poverty.

“We have to provide our people with job opportunities. We can only do that if we create an environment conducive to investments. More investments mean more jobs, more jobs mean less poverty,” he said.

Mr. Drilon has been a prime mover of Iloilo’s top infrastructure projects such as the Iloilo International Airport, the Senator Benigno Aquino Avenue in Diversion road in Mandurriao district, the new Iloilo-Bacolod ferry passenger terminal in City Proper district, and the P11.2-billion Jalaur multipurpose project in Calinog, Iloilo.

In two years, SMB’s P6.7-billion production facility in Leganes, Iloilo will also rise and pave the way for additional employment and economic activity.

Meanwhile, the feasibility study for the interisland bridge, which is being conducted by a Chinese firm, is expected to be completed by October, Mr. Drilon added.

MGen eyeing LNG to fuel power plant

By Victor V. Saulon, Sub-Editor

MERALCO PowerGen Corp. (MGen) is looking at liquefied natural gas (LNG) as a possible fuel for a future power plant project, its top official said, pointing to the need of the country’s power system for that facility.

“We’re looking [at that option] because there’s a demand for mid-merit and we think LNG might fit that particular demand,” said Rogelio L. Singson, MGen president and chief executive officer, on the sidelines of a conference attended by representatives of regional distribution utilities. “So yes, we are exploring.”

Mr. Singson said he expects the next move for a distribution utility is to seek for a “greenfield” or new power plant project fueled by LNG, which is said to be the cleanest of all fossil fuels.

LNG will be imported in its liquid form for reduced volume and easier transport and undergo a regasification process locally. Several entities are in the thick of planning or developing a receiving terminal for imported LNG.

Mr. Singson said he sees the need for a new gas-fired power plant to serve the system’s “mid-merit” requirement. Mid-merit facilities can easily be switched on or off as the need arises. The entry of more renewables with intermittent power such as wind and solar would require a gas-fired plant as complementary source.

“I have to transition. No ‘ifs’ and ‘buts’ as far as MGen is concerned,” he said, adding that previous PSAs with projects involving coal-fired power plants might not be acceptable now.

MGen is behind San Buenaventura Power Ltd. Co., which is pioneering the country’s first supercritical coal-fired power plant in Mauban, Quezon. The 455-megawatt (MW) plant is under construction and is scheduled for commercial operations in late 2019.

The company, a unit of the country’s largest power distribution utility Manila Electric Co. (Meralco), is planning to build an ultra-supercritical coal-fired power plant in Quezon province under Atimonan One Energy, Inc. The plant will have two units, each with a capacity of 600 MW.

MGen also plans to develop a two-unit coal power plant each with a capacity of 300 MW in Subic, Zambales. The project under Redondo Peninsula Energy, Inc. will support the growing power requirements in the Luzon grid.

Also in the planning stage is St. Raphael Power Generation, Inc.’s two-unit pulverized coal-fired power plant, each with a capacity of 350 MW, in Calaca, Batangas

Mr. Singson said his “best bet” for the next five to seven years is still solar and wind power. He said these projects have the “efficiencies” to address the immediate demand for energy while new technologies are evolving.

MGen aims to build a diversified power generation portfolio with 3,000 MW, including 1,000 MW in renewable energy. It is bidding for the 1,200 MW of power being sought by Meralco through a CSP,

“If we win the greenfield 1,200 MW, then it (MGen portfolio mix) will be 50-50 [coal and renewables]. If we lose, then it will be more RE (renewable energy),” he said. “It depends.”

MGen will pioneer the use of high efficiency, low emission technologies for its coal-fired power plants in the Philippines. It is looking for development opportunities in renewable energy across the country.

Not all Bordeaux is expensive

WHEN YOU think about Bordeaux, which I’m sure you’ve bought because of its reputation — you’re partaking in the glory of the French Second Empire.

You see, in 1855, Napoleon III (nephew of that Napoleon) ordered a classification system for the best wines in Bordeaux, in preparation for their exhibition at the 1855 Exposition Universelle de Paris. This classification led to the designations of premiers crus, deuxieme crus, and other crus. The French Second Empire has long been but a memory, but the classifications stay.

Now, it’s hard to imagine that one can partake of such a tradition with a mere P600, but a wine dinner last week at the Peninsula Manila’s Old Manila, called a Bordeaux Affair, showed just that. All the wines were apparently well-below or just playing at the P2,000-level.

The meal kicked off with a Smoked Duck Carpaccio, paired with a Chateau Blaignan 2014 Medoc. The wine had a smoky aroma which reminded one of the embers of a fireplace, and the pairing was one of rustic luxury — like owning a grand country house.

Next came Seared Mediterranean Sea Bass, paired with a Blason de La Tour Carnet 2011 from Medoc. The pairing led to a loving counterpoint between the bolder flavors of the wine giving gravitas to the lighter flavor of the fish, but this wine was a personal favorite: it had a strong, flamboyant opening, but softened to a whisper at the end of a sip, like a jazz singer offering a song only to you.

A Sous Vide Beef Tenderloin was paired with a Chateau Jean de Tremoulet 2013, Saint-Émilion Grand Cru. This pairing, meanwhile, gave a bit of liveliness to the beef, for the wine by itself was sharp and lively like a dancer’s kick, and had a light, spicy aroma. A Margaux de Brane 2014 had a leathery, soft scent, but lost its power from the strength of the Danish Bleu for the cheese course.

Dinner ended with La Chapelle de Meyney 2011 Saint-Estephe, paired with a chocolate Millefeuille. They complimented each other through their textures, for the wine had a mild fruity flavor and a very exquisite and silky mouthfeel.

The wines were from Vintage Wine Company, and its Chief Sommelier Officer, Daniel Blais, sat with us for coffee. “When we say Bordeaux, the two magic words that come into mind are grands crus,” he said. Thinking twice, he added, “And the price.”

Skeptics might say that one wine is as good as the other. Mr. Blais says, “I would never say anything bad against the pricing of Bordeaux. They’re worth it.” Bearing in mind that most of the wines that evening cost below P2,000 however, he said, “The challenge to find an expensive, great Bordeaux is easy, actually. What is difficult is to find an affordable and very, very pleasant-to-drink Bordeaux.

“Bordeaux is not just for special occasions. You can drink Bordeaux every day,” he said. — Joseph L. Garcia

Araneta, SLI team up for Bulacan project

ARANETA Properties, Inc. is teaming up with Sta. Lucia Land, Inc. (SLI) for a project in Bulacan.

In a disclosure to the stock exchange Wednesday, Araneta Properties said its board of directors has approved the plan to form a joint venture with SLI.

This will involve the development of its 580,154-square meter (sq.m.) property in Barangay Tungkong Mangga, San Jose del Monte, Bulacan.

“The board also delegated to management the determination of the terms and conditions of the joint venture,” the company said.

Araneta Properties’ land bank stood at 3.5 million sq.m. by end-June, valued at about P1.264 billion.

SLI has been ramping up the expansion of its residential and commercial properties. It earlier said it will spend P20 billion for projects in Metro Manila, Bulacan, Rizal, Batangas, Iloilo, Pangasinan, Palawan, Cebu, and Davao.

Araneta Properties suffered a net loss attributable to the parent of P14.24 million in the first half of 2019, against an attributable profit of P13.30 million. This came amid a seven percent increase in gross revenues to P16.31 million.

For its part, SLI more than doubled its attributable profit to P883.74 million in the first semester, on the back of a 70% jump in gross revenues to P3.496 billion.

Shares in Araneta Properties jumped 3.21% or six centavos to close at P1.93 each at the stock exchange on Wednesday, while shares in SLI ended flat at P2.50 apiece. — Arra B. Francia

Strengthening PHL as diving powerhouse

THE COUNTRY’S top dive spots took center stage during the first Philippine International Dive Expo held last week at the Conrad Hotel Manila as the country is seriously trying to strengthen the country’s position as a global diving powerhouse, according to a tourism executive.

“With this Philippine International Dive Expo we hope to raise the level of awareness higher [and] promote emerging destinations. But more importantly, we hope that this will provide the opportunity for us to showcase sustainable development efforts [of the DoT],” Benito C. Bengzon, Jr., Department of Tourism (DoT) Undersecretary during a press conference on Sept. 20.

The dive expo, which ran from Sept. 20-22 at the Conrad, held a dive conference “with at least 30 renowned local and international speakers” and “at least 60 international buyers” from DoT-identified markets including the US, the United Kingdom, France, Germany, Australia, and New Zealand.

“We’ve had similar initiatives in the not to distant past… diving has always been a priority product for the DoT,” Mr. Bengzon said before adding that this is the first time they provided a platform for business-to-business.

“We would like to use this venue to find out from experts both abroad and locally what measures we can take so we can bring diving tourism [higher],” he explained.

The Philippines is located in the Coral Triangle — the roughly triangular area of tropical marine waters which also include Indonesia, Malaysia, and Papua New Guinea, which contain at least 500 species of reef-building corals and thus thousands of species of marine life.

Among the top dive sites in the country include the Tubbataha Reef located in the middle of the Sulu Sea, Apo Island in Negros Oriental, and Malapascua Island in Cebu.

Underwater photographer Lynn Funkhouser noted that for more than four decades, she has been coming to the Philippines several times a year to photograph its rich marine life.

Though she has a soft spot for Anilao, Batangas where she started her long-standing love affair with the Philippine marine life, she said that whenever she travels to another island, she keeps discovering something new.

Mr. Bengzon noted that “about 5% of foreign visitors to the Philippines” come to dive.

“For example, last year we had 7 million international tourists, 5% of that is about 300,000 people,” he said.

Divers are also big spenders as an average tourist spends about $1,200 during their visit but divers spend “at least double that,” thus making a case for it being a priority product of the department. — Zsarlene B. Chua

Top managers predict PSEi will surge above 8,000

THE STOCK MARKET is expected to return above the 8,000 level.

SOME of the Philippines’ top money managers see central bank easing and low inflation pushing the nation’s equity benchmark back above the key 8,000 level.

The Philippine Stock Exchange index (PSEi) has retreated 5.8% since riding a bull market to as high as 8,365.29 on July 15. The gauge has breached the 8,000 mark about a dozen times this year only to retreat amid concerns including the global trade war and slowing domestic growth.

Fund managers at BDO Unibank, Inc. and Security Banking Corp. expect continued interest rate cuts will signal that inflation remains under control. The nation’s central bank is expected to make the second-straight 25-basis-point cut to its key rate at its Sept. 26 meeting. Together with higher government spending, the central bank policy should boost growth, the money managers said.

Fritz Ocampo, chief investment officer at BDO, sees the PSEi rising to 8,400 as early as the fourth quarter. He favors property, consumer companies and some banks and conglomerates, including names such as SM Prime Holdings, Inc. and Metro Pacific Investments Corp. BDO is the Philippines’ largest money manager based on a Bloomberg survey, handling assets of P1.3 trillion ($25 billion).

“We are rotating our funds,” Mr. Ocampo said. “Those that have run up and offer limited upside, we are taking profit and rotating to the laggards. We are accumulating names the market has left behind but are promising.”

Security Bank sees a climb to 8,200 by yearend but cautions that profit taking could kick in above 8,000. In addition to concern over US-China tensions, investors may look to shift funds into upcoming IPOs from Metro Pacific Hospital Holdings, Inc. and AllHome Corp., according to Noel Reyes, the bank’s chief investment officer. Rate cuts should help the market hold above 7,800 support, he said.

“We like stocks with earnings visibility and that promise improvement,” said Mr. Reyes, who helps manage P54 billion. — Bloomberg

TDF yields up on RRR cut expectations

TERM DEPOSIT yields saw a slight uptick on Wednesday as the market anticipates the cut in lenders’ reserve requirement ratios (RRR) will come later.

The central bank received bids amounting to P74.465 billion for its term deposit facility (TDF) on Wednesday, lower than the P90 billion it wanted to sell.

This is also lower compared to the P96.435 billion the Bangko Sentral ng Pilipinas (BSP) received last week against a P80-billion offering.

Broken down, demand for seven-day papers amounted to P26.616 billion, falling short of the P30 billion on offer but beating last week’s P32.598 billion in bids for a P20-billion offering.

Rates for this tenor ranged from 4.25% to 4.65%, a slightly wider margin compared to last week’s 4.29% to 4.385% range. The average rate settled at 4.3589%, 2.66 basis points (bps) higher than last week’s 4.3323%.

Meanwhile, 14-day papers fetched bids totaling P23.07 billion, undersubscribed against the P30 billion the BSP offered. It was also below the P31.314 billion bids tendered last week against a P30-billion offer.

Banks sought returns ranging from 4.3% to 4.65% from the two-week papers, inching up from last week’s 4.3 to 4.545% range. The average rate was seen at 4.4391%, 2.52 bps higher than last week’s 4.4139%.

Meanwhile, the 28-day tenor attracted tenders worth P24.779 billion against the P30 billion on offer, also a decline from last week’s P32.523 billion worth of bids for the P30-billion offer.

Yields sought by lenders stood at between 4.37% to 4.65%, a wider band compared to last week’s 4.3-4.5140% range, bringing its average to 4.4577%, a 0.01 bp slip from than last week’s 4.4578%.

For Ruben Carlo O. Asuncion, chief economist at UnionBank of the Philippines, Inc., “the current week is crucial for monetary policy and its stakeholders, like banks and other financial institutions.”

“One driver that may be important to point out is that a rate cut decision is still to be delivered this week (September 26), and the resulting consensus is to wait until a cut is delivered to maximize yields. Although not necessarily automatic in pre-monetary policy rate cuts, this can be a valid and potential driver for the said under subscription seen,” he said.

Meanwhile, Rizal Commercial Banking Corp. economist Michael L. Ricafort cited the BSP chief’s remarks on the timing of the cut in RRR.

“TDF auction yields were mostly slightly higher…after the latest signals from BSP Governor [Benjamin E.] Diokno that any cut on banks’ RRR on September 26, 2019 would be unlikely,” Rizal Commercial Banking Corp. Michael L. Ricafort told BusinessWorld in an email.

“The slight uptick in TDF yields and lower bids/appetite for the TDF auction may also have to do with the recent increase in local fuel pump prices, though global crude oil prices already eased and are just modestly higher,” Mr. Ricafort added.

The TDF is the central bank’s primary tool to shore up excess liquidity in the financial system and to better guide market interest rates.

Asked whether the monetary board will also move on bank RRR, Mr. Diokno said, “Hindi siguro (Maybe not)… pero yung RRR naman is always in the agenda (but the RRR is always on the agenda). Pwede naming i-announce ‘yun (We can announce it) anytime. Yung RRR walang definite schedule yan. (The RRR has no definite schedule),” he told reporters on Tuesday.

The Monetary Board policy meeting on Thursday could bear the announcement of a further slash in policy rates, amid the central bank chief’s hints.

The previous MB meetings held on May 9 and Aug. 8 paved way for rate cuts for overnight reverse repurchase (RRP), overnight deposit and overnight lending to 4.25%, 3.75% and 4.75%, respectively. — L.W.T. Noble

Realme targets to put up more concept stores in Davao malls

By Carmelito Q. Francisco
Correspondent

DAVAO CITY — Realme Philippines wants to put up a concept store in every mall in this city, with two of them targeted for opening before the end of the year.

Eason G. de Guzman Jr., Realme Philippines marketing lead, told BusinessWorld on Wednesday that the brand has been in discussions with mall operators for space allocation.

“Hopefully, this year (the two concept stores can be opened) as we still have three months. Our construction phase will just be one month,” Mr. de Guzman said.

At present, the brand has 26 kiosks in Mindanao, or standalone stores that measure about two meters by two meters. The models of the brand are also present in 4,500 stores nationwide, with 200 of them in the city.

It also has four service centers in Mindanao.

“Our approach really is into brick and mortar,” Mr. de Guzman said, so that when buyers look for phone models, the store can immediately show these as the brand’s “inventory is really healthy.”

He added that the company has also implemented a marketing strategy to connect with its niche market.

“What we are doing right is an unorthodox promotion of the brand,” Mr. de Guzman said, noting that it has partnered with Mobile Legends, a mobile online game, so it can connect with gamers.

Based on data from Realme, the game has about one million users in the Philippines — a big chunk of the mobile phone market — with about seven million constant users daily playing games while commuting or in their leisure time.

To convince gamers, Mr. de Guzman said the brand allows them to try its smartphones so they can see their gaming capability. He noted that Realme’s phones are also affordable when compared with other top brands in the market.

Mr. de Guzman and other Realme officials were in the city to introduce its new quad-camera phones, the Realme 5 and Realme 5 Pro.

1st Camiguin Dive Fest attracts international divers

THE first Camiguin Dive Festival — an initiative of the Camiguin Provincial Government and the Department of Tourism-Region 10 — registered over 500 dives from dive groups from Manila, Batangas, Cebu and Bohol, as well as foreign enthusiasts from Spain, Japan, Sweden, Finland, Australia, Korea, Russia and the United Kingdom.

Located off northern Mindanao mainland, it has 20 top dive sites including the Mantigue Island Nature Park, a marine sanctuary surrounded by a drop-off reef, and Old Volcano which has a spectacular canyon.

A highlight of the two-month festival was the Underwater Photography Competition topped by Peter Gosling and Lauren Hubbard, who bested other contestants in the wide angle in macro categories, respectively. Both are from the United Kingdom and hosted by Black Beach Divers.

Jo Nathaniel Yasay of Scuba de Oro placed second in the wide angle, along with Daniel Dominic Calo of Ajis Camiguin Adventures in the macro division. In third place were Jeffrey Ong of Ajis Camiguin Adventures and Edgar Alan Zeta Yap of Black Beach Divers in the wide angle and macro categories, respectively.

Judging the competition were underwater photographers Penn Delos Santos, Ram Yoro, and Ramon Suijo, and Philippine Commission on Sports Scuba Diving commissioner Bo Mancao.

With its powdery beaches, waterfalls, and hot and cold springs, diving is another compelling reason to come to Camiguin for the forthcoming 40th Lanzones Festival which will be held from Oct. 20-27.

Fruitas banks on consumer familiarity for IPO success

FRUITAS Holdings, Inc. is unfazed by the number of companies going public at the same time as its initial public offering (IPO), confident that Filipino consumers’ familiarity with its products will translate into IPO success.

Officials of the operator of beverage kiosks such as Buko ni Fruitas, Johnn Lemon, and Black Pearl said the list of IPO hopefuls this year only illustrates the vibrancy of the stock market.

“Ito na ang panahon, ayaw na magpapigil eh. Walang problema na marami kaming kasabay, kasi ibang industriya naman,” Fruitas Founder and Chief Executive Officer Lester C. Yu told reporters in Makati on Tuesday.

The company’s tentative timeline for its IPO’s offer period, set from Nov. 18 to 22, will follow that of Taiwanese firm Cal-Comp Technology (Philippines), Inc.’s P10.67-billion maiden offering that will run from Nov. 4-11.

It will directly coincide with Metro Pacific Hospital Holdings, Inc.’s IPO, which hopes to raise up to P83.3 billion.

“This will encourage more people to look at us. It’s a different industry, for us the connection with the consumers is more direct,” Fruitas Chief Financial Adviser Calvin F. Chua told reporters in the same event.

Fruitas looks to raise up to P1.2 billion from the issuance of up to 602 million shares at up to P1.99 each. The fresh capital will be used to finance its store expansion over the next two to three years.

Mr. Chua said they want to put up 150 to 250 stores annually until 2022, in addition to its current network of 949 stores in the country. They will also add two food parks in Metro Manila and in Luzon, to complement their two existing food parks in Quezon City.

Aside from building more stores, Mr. Yu said they are also ramping up their institutional business. For instance, its roasted pig brand Sabroso Lechon already serves some hotels, while at least 50 Andoks stores and supermarkets now carry their buko juice and calamansi juice brands.

“We continue to look for the same deals,” Mr. Chua said, noting that this will help them bring down operating expenses as opposed to building actual stores.

Fruitas also wants to strengthen its delivery business, with Mr. Yu saying that part of the plans for the IPO is to get up to 80 vehicles for its logistics network, in addition to at least 40 trucks they currently have.

For now, the company offers delivery services for Sabroso Lechon and coconut water brand 8 Coco.

Asked for his outlook on growth, Mr. Chua said the factors that boosted their performance in the past remain.

“All the factors are still there, the growing middle class, rapid urbanization. We’re able to locate in locations with foot traffic like terminals, hospitals, schools. The economy is really vibrant,” Mr. Chua said. — Arra B. Francia

Hacking of bank systems a form of ‘economic sabotage’ under new law

PRESIDENT Rodrigo R. Duterte has signed a law declaring the hacking of banking systems as a form of economic sabotage, and imposing stiffer penalties on those who hack bank accounts and conduct credit card, automated teller machine (ATM) card, and debit card fraud.

Mr. Duterte on Aug. 28 signed Republic Act (RA) No. 11449, which amends RA No. 8484 or the Access Devices Regulation Act of 1998. Copies of the law were released to reporters on Wednesday.

Section 1 of the law reads in part: “[T]he commission of a crime using access devices is a form of economic sabotage and a heinous crime and shall be punishable to the maximum level allowed by law.”

Access devices, as defined by the law, include any “card, plate, code, account number, electronic serial number, personal identification number or other telecommunications service, equipment or instrumental identifier or other means of account access that can be used to obtain money, good, services or any other thing of value or to initiate a transfer of funds (other than a transfer originated solely by paper instrument).”

Prohibited acts, as enumerated under the Section 9 of the law, include the skimming of ATM cards, hacking banking systems and counterfeiting of credit or debit card.

Under the new law, one found guilty of hacking a bank’s system, skimming of at least 50 ATM cards or online banking accounts, which constitutes “economic sabotage,” will face life imprisonment and P1-5 million fine.

The previous law imposed only P10,000 or twice the value obtained through the offense and six to 20 years of imprisonment for access device fraud.

The new law states that possession of at least 10 counterfeit access devices and/or unauthorized access devices which was used to access at least one account will warrant a fine of at least P500,000 and imprisonment of 12-20 years.

The law defines counterfeit access device as a card, plate, code or account number, among others, “that is counterfeit, fictitious, altered or forged, or an identifiable component of an access device or counterfeit access device or any fraudulent copy or reproduction.”

Those found in possession of 10 or more counterfeit access devices — even if they were not proven to have accessed any account — will face six to 12 years imprisonment and P300,000 fine or twice the equivalent of the aggregate amount of all affected bank accounts, whichever is higher.

Those using fraudulent credit cards will face four to six years imprisonment and a fine equivalent to twice the value obtained.

Those who used even just one counterfeit device or possessed device-making or altering equipment face 10-12 years jail time and P500,000 fine or twice the value obtained, whichever is higher.

The law further states that a penalty amounting to P800,000 or twice the value obtained, whichever is higher, and a jail term of 12 to 20 years will be meted against individuals who committed any offense under Section 9 of RA 8484, “which occurs after a conviction for another offense under the same section, or an attempt to commit the same.”

The new law, which takes effect 15 days after its publication in the Official Gazette or in a newspaper of general circulation, directs banks to submit real-time reports on access device fraud incidents to the National Bureau of Investigation and the Anti-Cybercrime Group of the Philippine National Police.

The law had originated from the House of Representatives as House Bill No. 6710 in February last year. The Senate approved the bill on final reading with 20 affirmative votes and no negative ones on June 3 this year.

The Bankers Association of the Philippines (BAP) said it supports the new law, which protects their clients and provides remedial measures to help attain speedy conviction against offenders.

“The unabated activities of these criminals will not only result to loss of money but likewise cause distrust to the financial institutions. In both instances, the damage is beyond pecuniary estimation as it will destabilize the economy,” the BAP said in a statement.

“The relatively lighter penalties and fines as well as the vagueness in elements of the crime in the old law have been adequately addressed by these amendments. These amendments illustrate Congress’s deep appreciation of fraud and cybersecurity threats that this important legislation will effectively address,” the BAP added. — Arjay L. Balinbin

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