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Health dep’t to require FDA licensing for e-cigarette industry

The Department of Health’s Administrative Order 2019-0007 will require a license from the Food and Drug Administration (FDA) to participate in the business. — BW FILE PHOTO

THE Department of Health (DoH) said it will require licensing for all makers, sellers and distributors of e-cigarettes and vaporizers (vapes) under the new guidelines covering the sector.

Published Tuesday, DoH Administrative Order (AO) 2019-0007 will require a license from the Food and Drug Administration (FDA) to participate in the business.

The AO calls the sector the Electronic Nicotine and Non-nicotine Delivery Systems (ENDS/ENNDS) industry.

“All establishments engaged in the manufacture, distribution, importation, exportation, sale including online sale, offering for sale, and transfer of ENDS/ENNDS products shall first secure a License to Operate (LTO),” according to the AO.

The AO, signed by Health Secretary Francisco T. Duque III on June 14, also gave the FDA the authority to inspect establishments before and after the issuance of the license.

DoH also added that licensed establishments can subsequently apply for “a product marketing authorization, such as Certificate of Product Registration (CPR) or FDA Electronic Regulation Number (FERN).”

Securing marketing authorizations is also needed before an establishment can manufacture, distribute, import, and export ENDS/ENNDS products.

The FDA said it hopes to ban refills formulated to appeal to young users and will require tamper-resistant packaging and health warnings for refills and devices.

Users are also prohibited from vaping in public, which is allowed only in designated vaping areas.

Trade and Industry Secretary Ramon M. Lopez meanwhile called for more consultation with the industry, which he said has the potential to generate jobs.

“It’s a potential industry that we can consider,” he said, adding that the Department of Trade and Industry (DTI) is interested to hear out the concerns of the sector.

“We are asking (the DoH and FDA to) conduct consultations para ma-address nila (so they can address) the needs of stakeholders,” he said, adding that he has received position papers from tobacco and e-cigarette groups regarding this matter.

“But we are pro health,” Mr. Lopez added, adding: “The industry is a job generator but we are considering (whether or not) if it is a healthy industry.” — Gillian M. Cortez

ERC halves caseload of power co-ops late in paying fees

THE Energy Regulatory Commission (ERC) has closed more than two dozen pending cases against electric cooperatives for late or non-payment of supervision and regulation fees.

The commission’s caseload of such violations has thereby been reduced by half.

The ERC’s Item IV of Resolution No. 21, Series of 2007, calls for the payment of supervision and regulation fees by cooperatives.

The fees represent the annual reimbursement of the expenses incurred by the ERC in the supervision of electric utilities, transmission companies and/or in the regulation or fixing of their rates.

“The said fees shall be paid on or before September 30th of each year with a penalty of fifty per centum in cases of delinquency. Provided, further, that if the fees or any balance thereof are not paid within sixty days from the said date, the penalty shall be increased one per centum for each month of delinquency thereafter,” Item IV states.

The issue for resolution by the commission involve whether or not the electric utilities should be held administratively liable under the guidelines to govern the imposition of administrative sanctions in the form of fines and penalties pursuant to Section 46 of Republic Act No. 9136 or the Electric Power Industry Reform Act of 2001 (EPIRA), as amended.

Also at issue is whether criminal action should be instituted against the utilities’ directors and officers for the non-payment of penalties.

In many of the cases, ERC records showed the utilities paid their remaining penalties before the issuance of their show-cause orders.

In some, the ERC noted that while strict application of its rule holds an electric cooperative administratively liable, the commission, employing its full discretion, found it just and fair to exercise leniency in its judgment.

For instance, compliance within a month from receipt of the show-cause order or merely two days from the lapse of the 15-day period to explain, was taken to mean that the electric utility did not intend to defy the rules and regulations of the ERC.

In some cases, the regulator warned that similar acts in the future “shall be dealt with more severely.”

The termination of the cases was signed by Agnes VST Devanadera, ERC chairperson and chief executive officer. — Victor V. Saulon

Philippines wins seat in UN marine science commission

THE PHILIPPINES has been re-appointed to the executive council of a United Nations organization for marine science, the Department of Foreign Affairs (DFA) said.

The Philippines secured by acclamation a seat for a third year in the 40-member International Oceanographic Commission (IOC) Executive Council, which is under the UN Education, Scientific and Cultural Organization (UNESCO).

“As a maritime and archipelagic state located at the center of the world’s marine biodiversity, the Philippines shall continue to contribute to the Commission’s unique role in fostering international cooperation in ocean science and in achieving the 2030 Sustainable Development Agenda, particularly Goal 14 on Life Below Water,” the DFA said in a statement Tuesday.

Goal 14 of the SDG is geared towards the conservation and sustainable use of the oceans, seas and other marine resources.

The term runs to 2021. The election of the Council’s new officers was held on July 3 at the 30th session of the IOC Assembly at UNESCO Headquarters in Paris.

“Its purpose is to promote international cooperation and to coordinate programmes in research, services and capacity-building, in order to learn more about the nature and resources of the ocean and coastal areas and to apply that knowledge for the improvement of management, sustainable development, the protection of the marine environment, and the decision-making processes of its Member States,” the DFA also said.

The IOC elected as its chair Argentina’s Ariel Hernán Troisi and as its Vice Chairpersons Monika Breuch-Moritz (Germany), Alexander Frolov (Russian Federation), Frederico Antonio Saraiva Nogueira (Brazil), Satheesh Chandra Shenoi (India), and Karim Hilmi (Morocco).

UNESCO, in a statement on July 3 said the Council meets every year to review issues and items from on-going work plans as well as prepare for the IOC Assembly.

Countries that also won a seat in the Council include Canada, France, Greece, Italy, Portugal, Spain, Sweden, Turkey, and the UK. — Charmaine A. Tadalan

BoI sees P414M worth of investment from Cotabato chicken contract-growing deals

THE Board of Investments (BoI) said it expects nine procurement tie-ups to generate P414 million in investment after San Miguel Foods, Inc. (SMFI) participated in a business matching exercise in Cotabato Province.

In a statement Tuesday, the BoI said the Procurement Matching Activity and Financing Forum organized in Kidapawan City, Cotabato in May generated opportunities for micro, small and medium enterprise (MSME) poultry raisers to collaborate with SMFI on technology upgrades, marketing and financing.

“During the matching session, nine participants agreed to partner with SMFI. Among the nine, four individuals who are already into poultry growing have expressed their intention to upgrade their poultry facilities. Five other individuals intend to venture into new poultry projects,” it said.

The BoI said SMFI is looking for more partners for its poultry business by tapping cooperatives and overseas Filipino workers, aside from MSMEs, for its “growership program.”

The growership program requires partners to provide SMFI with land, buildings, equipment, water and electricity, security, labor, and farm management while the company provides day-old chicks, feed, vaccines, medicine, technical assistance, laboratory services and payment schemes.

“By partnering with BoI and tapping the MSMEs, the procurement process could ramp up the SMFI dressing plant requirements and improve its efficiency utilization. Meanwhile, the Development Bank of the Philippines (DBP) has also committed to back the financing needs of the MSMEs,” it said.

SMFI is hoping to tap contract growers for its P2.2-billion integrated feed mill plant in Sta. Cruz, Davao del Sur and P1.3-billion dressing plant, which is projected to require around 40,000 chickens per day. — Denise A. Valdez

TESDA, DepEd to harmonize policy for Senior High School technical-vocational program

THE Technical Education and Skills Development Authority (TESDA) said it has signed an agreement with the Department of Education (DepEd) to harmonize programs and standards for the technical-vocational education and training program of K-to-12 basic education system.

TESDA and DepEd signed a Memorandum of Understanding (MoU) which will establish a Joint Working Group to ensure that TVET policy is harmonized.

“TESDA and DepEd have assembled a Joint Working Group on Technical-Vocational Education and Training (TVET), comprising five members each from both parties, who will be primarily in charge of the harmonization and complementarity of strategies, policies and programs, consistency and quality assurance of Training Regulations (TRs) and standards, and discussion and resolution of concerns as may be raised by either party concerning TVET,” TESDA said in a statement Tuesday.

TESDA Director-General Isidro S. Lapeña said in a statement that the partnership with the DepEd to strengthen TVET will empower Senior High School (SHS) students in the Technical-Vocational-Livelihood (TVL) track.

“We look forward to working with the Department of Education in building up the TVL track in senior high school from this year onward. We hope that this continuing partnership will result in positive outcomes and will benefit also the future generations of SHS students,” he said.

The group will also be tasked to produce research and data relevant to TVET. — Gillian M. Cortez

FDA orders withdrawal from market of gin brand on high methanol levels

THE Food and Drug Administration (FDA) has ordered the recall of all Cosmic Carabao Gin products from the market, after finding that the product contains high levels of methanol.

The FDA issued Advisory 2019-188 on Tuesday which that all Cosmic Carabao Gin still on store shelves are subject to confiscation, and banned further sales.

“In the interest of public protection, the Field Regulatory Operations Office inspectors and Regulatory Enforcement Unit Officers of FDA shall seize and/or confiscate all Cosmic Carabao Gin products in the market. All Local Government Units and Law Enforcement Agencies are requested to ensure that this product is not sold or made available in their localities or areas of jurisdiction,” according to the advisory.

The order follows reports of two women who were hospitalized for alleged methanol poisoning after consuming the drink, which resulted in the death of one of them.

According to the FDA, non-toxic levels of methanol are usually found in both alcoholic and non-alcoholic fermented drinks as a result of natural fermentation. Methanol is also used in household products and gasoline.

“Higher concentrations of methanol in alcoholic drinks can happen when methanol is deliberately added to alcoholic drinks. Signs and symptoms of methanol poisoning include headaches, vomiting, abdominal pain, hyperventilation, and a feeling of breathlessness. Blindness can also happen in severe cases,” according to the advisory, which was signed by FDA Officer-in-Charge Rolando Enrique D. Domingo.

The brand does not have an FDA registration. The FDA warned consumers to avoid purchasing food and drink products that are not FDA approved. — Gillian M. Cortez

Hedge funds chart course through ‘IMO 2020’ storm

LONDON — Shipping companies, refineries, freight derivatives or diesel cracks? Investment funds are placing their bets as the shipping sector prepares for new rules limiting sulphur emissions from ocean-going vessels.

Ever since the International Maritime Organization (IMO) said the maximum sulphur content in marine fuel must drop to 0.5% from 3.5% from 2020, shipping companies have been wrestling with how to comply without driving up costs at an uncertain time for global trade.

Some shipowners are installing exhaust cleaning systems known as scrubbers so they can continue to use high-sulphur fuel and some are switching to low-sulphur marine diesel, but all expect a period of turbulence when the “IMO 2020” rules come in.

Investors in turn are coming up with strategies and launching funds with exposure to parts of the oil and shipping industries they expect to benefit from the new emissions caps.

John Kartsonas, managing partner of Breakwave Advisors, said while broader concerns about trade have dented investors’ views on shipping, IMO 2020 was likely to drive freight rates higher.

Breakwave launched an exchange-traded fund last year to invest in dry bulk freight derivatives, hoping to benefit from IMO 2020.

“Rarely you see such a potentially massive disruption,” said Kartsonas. “Delays, a reduced active fleet supply, slow steaming and port congestion can push freight rates to decade highs, and beyond.”

The Baltic Exchange’s main sea freight index, which tracks rates for ships carrying dry bulk commodities, slumped after the financial crisis to 700 points from a record 11,793 points in 2008. It’s now about 1,500 points.

Dry bulk ships make up more than a fifth of the world’s ocean-going vessels and many are among the most polluting ships.

DERIVATIVE BY DESIGN
At hedge fund Svelland Capital in London, one strategy is to focus on petroleum products likely to be affected by the rules.

“IMO 2020, together with the ballast water treatment, will turn shipping upside down and create supply shock,” chief investment officer Tor Svelland said.

Svelland Capital is launching an “IMO direct exposure fund” in July aimed at investors who want to take positions based on IMO 2020, but are less familiar with oil derivatives.

“This is the largest regulatory change in the oil space ever and it will have a massive effect far outside of shipping,” said the fund’s portfolio manager Kenneth Tveter.

For now, there is no consensus on whether there will be enough low-sulphur fuel to meet demand come 2020. Of the roughly 60,000 vessels worldwide, industry consultants estimate only 3% to 5% are likely to have scrubbers by 2020.

It is also unclear what will happen to demand for high-sulphur fuel — all of which means the price gaps between different fuel grades, as well as the different types of crude used to make them, are likely to change.

“You can try and pick winners in the shipping segment of the equity markets, but to get a pure play you need the derivatives market,” Tveter said. “The new fund will look at all the parts of refining that will be affected by the new regulations.

In another sign of the impact of IMO 2020, China said on July 4 that it planned to launch a futures contract for low-sulphur fuel oil by the end of the year.

REFINING REFINING
Dutch asset manager Robeco is also focusing on fuel, but it’s investing in oil refineries that are well-placed to produce large quantities of low-sulphur diesel.

“We are invested in refiners since earlier this year and this has been one of the drivers for that investment,” said Fabiana Fedeli, global head of fundamental equities.

Robeco is selecting so-called complex refineries, plants with lots of units that can turn low-value fuel oil into higher-value products such as distillates, octane and low-sulphur fuel.

Fedeli said concerns about disruptions to global trade had weighed on refining margins and related stocks this year, but IMO 2020 could change that.

“We expect that the impact on refinery margins will become tangible from late Q3 2019 when ships are likely to begin shifting to compliant fuels,” she said. “Interestingly, this is still not reflected in diesel crack futures.”

Alistair Way, head of emerging market equities at UK asset manager Aviva Investors, said refineries that have invested to produce more compliant fuel would benefit.He said Asian refiners such as Thai Oil and S-Oil, were well placed as they produced a bigger than average proportion of middle distillates and had less exposure to high-sulphur fuels.

Hedge fund CF Partners in London is focusing on price gaps between different crudes. It expects sweet crude with higher levels of distillates such as Nigeria’s Bonny Light or U.S. shale to be more in vogue than heavier, sour crude.

SCRUB THAT
CF Partners is also getting exposure to US-flagged ships known as Jones Act carriers after a law requiring goods shipped between US ports to be transported in US vessels.

Elvis Pellumbi, manager at CF Partners, said it was buying stocks in shipping firms such as Overseas Shipholding Group. Pellumbi’s fund has $400 million under management, of which 30 percent is investments related to IMO 2020.

George Kaknis, portfolio manager at hedge fund LNG Capital, said he was looking at shipping firms such as American Shipping Company.

“The more shale is produced out of the US, the more these guys are kept busy and the more the day rates go up,” he said.

According to data from Symmetric, which tracks investment funds, hedge fund ownership of some shipping stocks rose in the first quarter. Their ownership of Nordic American Tanker rose to 12% from 8% in the fourth quarter last year, while hedge fund stakes in DryShip rose to 13% from 5%.

Other shipping firms investors said they were looking at with IMO 2020 in mind include Scorpio Tankers, Navios Maritime Acquisition, DHT, Frontline and Euronav.

While some shipowners have installed cleaning systems, others see them as potentially high risk as some ports have already banned or restricted scrubbers that pump waste water into the sea, and more may follow suit.

Some investors say the upfront cost of installing scrubbers — about $2 million to $3 million each — also means it would take longer for them to pay off, especially if the price gap between low and high-sulphur fuels narrows.

“We don’t believe that those who have invested in scrubbers will achieve the amazing returns they have been advertising,” said Pellumbi at CF Partners. “Refiners have/are adapting their production slates to produce more of the right product.” — Reuters

Tawi-Tawi’s Sibutu Island chosen as site for floating solar farm prototype

THE Department of Agriculture (DA) said a prototype floating solar farm funded by the fisheries bureau will be built in Tawi-Tawi Province’s Sibutu Island.

Agriculture Secretary Emmanuel F. Piñol said in a social media post that the Bureau of Fisheries and Aquatic Resources will provide P20 million for the project in cooperation with the Aboitiz Group’s power unit. It is expected to be completed in four months.

Mr. Piñol said AboitizPower executives briefed the government on the floating solar farms’ potential for generating power to run ice-making and cold storage facilities in remote fishing communities, thereby helping resolve the issue of post-harvest losses in the fisheries sector because the fresh catch cannot be immediately sold, processed, or stored.

The power officials said power can also be stored in batteries to provide light to the fishing communities.

The use of floating solar farms allows generators to minimize land use.

The technology was introduced in the Philippines by SN Aboitiz Power-Magat (SNAP-Magat), a joint venture between Norwegian company SN Power and AboitizPower.

In June, SNAP-Magat invested P24 million for a 200-kilowatt pilot floating solar project in Ramon, Isabela. The Isabela farm has 720 solar panels overs 2,500 square meters of the Magat reservoir.

The DA and the Department of Interior and Local Government (DILG) are also set to sign a memorandum of agreement (MoA) for the Solar-Powered Rural Water Supply Program, which will provide irrigation for vegetable farms and high value crops and potable drinking water for remote areas.

The two departments agreed to start the program this year with a prototype to be funded by the DA under its Solar-Powered Irrigation System project.

Mr. Piñol said, also on social media, that about 30% of 40,000 barangays nationwide do not have access to safe drinking water, which also affects food production, especially vegetables and other crops.

In a text message, Mr. Piñol said the MoA is still being drafted, but he expects the DILG to be responsible for identifying the barangays, while the DA will construct the facility and organize the farmers using it.

The MoA signing is expected next month. — Vincent Mariel P. Galang

Why not a Department of Agribusiness?

It seems that as often happens, Rodrigo Roa Duterte’s announced “transfer” of Agriculture Secretary Emmanuel Piñol to the Mindanao Development Authority is on hold following the announcement by Senator Bong “Rasputin” Go that Piñol is still staying in his Cabinet post because “he has performed well.” I wonder what the basis for this assessment is since all the statistics (contribution to GDP, growth rate, etc.) indicate the dismal state of Philippine agriculture, on which 30% of our families basically depend, and to which most of our poverty incidence belongs.

Agriculture has never really been a significant contributor to our economy; and it is hard to believe that in all this time, government leaders cannot seem to wake up to the need to radically rethink the direction for our crucial food production sector. Today, rice importation has been liberalized which has benefited rice consumers, but domestic rice producers are howling. Other piecemeal initiatives are being announced, such as the provision of free irrigation and, incredibly, free farm equipment. If agriculture officials take a look at history, they should realize that when government provides irrigation for free, it helps for a while — until the system breaks down from weather disturbances and lack of maintenance. That is why Irrigators’ Service Associations (ISAs) were organized, to ensure maintenance of the systems. The organized ISAs also required farmer beneficiaries to pay regular fees to fund the maintenance of the systems. The Provision of free farm equipment, I fear, will be a management nightmare. Who is responsible for allocation of time for equipment use? For maintenance? For storage? If management is to be run by government functionaries, I can foresee too many opportunities for graft and corruption.

The experience with the wasteful and disastrous National Food Authority should give us lessons on why government should not mess with the allocation of goods and services except for the provision of hard infrastructure and social services such as health and education.

We need to look strategically at food production as basically a business or negosyo sector, rather than food production sector. We have to rethink agriculture and call it what it should be: Agribusiness. While some small farmers may want to remain independent, the fact is that the average age of farmers is 60 years, and their descendants and they themselves do not wish their unprofitable backbreaking work on their children who prefer to work on computers. The need to rethink and act is urgent and crucial for the sake of our rural people, and for our food security.

To raise productivity we need to have efficiencies of scale. This means integration of modernized production systems, access to technology and finance and marketing competitiveness. This calls for organized, larger-scale systems of cooperatives or entrepreneurial ventures working with small farmers as contract growers. Land reform has brought about small-holder farms, which are decreasing in number as unproductive small farms are converted into housing subdivisions or malls.

PHILIPPINE STAR/EDD GUMBAN

What we need in a Department of Agribusiness is someone, for instance, like Trade and Industry Secretary Ramon Lopez, who has worked with the private sector on “Go Negosyo.” The role of government here emphasizes a promotive and supportive rather than regulatory function. Incentives for private investment and initiatives that make it worthwhile for entrepreneurial risk-taking is what we need to create and install, rather than give away free farm equipment and irrigation. There are possibilities in free or reduced taxation policies for start-ups, to make the risk-taking attractive enough. Access to foreign markets can be facilitated and eased. Crop insurance to ensure protection in the context of our weather disturbances can be provided by government to reduce investment risks. We might also learn some lessons from the incentives provided to rice farmers in Japan.

Perhaps the Department of Agribusiness (DA) can have a technical support division: The new DA can provide technical information based on soil analysis, access to domestic and export markets, guidance on the appropriate crops to grow per town, province, and region. This is what can be provided free by the government. The objective is to facilitate investments and help ensure successful agribusiness ventures. Since the agriculture bureaucracy has been devolved onto the LGUs, perhaps their focus can be reoriented into agricultural research and information dissemination.

Agribusiness ventures can hire agriculture technicians who can be retrained to become “farmers’ friends” and technical advisors, as they have successfully done in Vietnam. The frequent change in LGU leadership and the unclear — or the lack of — agriculture policies have weakened the ability of “agriculture technicians” to support local farmers.

Perhaps a new leadership, and a reorientation to a Department of Agribusiness can begin with consultations with the business community and farmers cooperatives (including the agrarian reform beneficiaries) toward the restructuring of the food production sector to a private business-oriented sector. The legislative leaders should also get involved in order that they can come up with supportive policies and incentives to get agribusiness moving.

 

Teresa S. Abesamis was professor at the Asian Institute of Management and a Fellow at the Development Academy of the Philippines.

tsabesamis0114@yahoo.com

A Triennial Victory

The undulation of Philippine sovereignty in the historically labeled South China Sea is becoming more turbulent. And as the Duterte presidency reaches its three-year mark, the arbitral ruling on the contested waters is also approaching its triennial.

On July 12, 2016, the Hague ruling accorded to the Philippine government the legal victory over the disputed territory.

Legally (and as common sense dictates), China does not have a sole claim on the disputed waters, especially without considering the interests of other parties such as Vietnam, Malaysia, Borneo, Brunei, and Indonesia. As it stands, however, the big Eastern power continues to flex its muscles and has undertaken harassment and military activities to assert its control.

Along with many other countries that seek to maintain safe passage and freedom of navigation, the US, Great Britain, Australia, Japan, India and other powers have expressed their concern. The international community, so to speak, is very much involved in this predicament and seeks to establish a so-called rules-based order in the area.

It is in this respect where the Philippine government, instead of shunning the international community, should make a firm stand toward multilateral relations and agreements. In this way, the neighboring small powers could not be easily led toward bilateral negotiations and become marginalized. More so, the dispute is an international issue and the real parties in interest alongside with the powerful stakeholders should assert an order before it is too late.

On the Philippine side, the precarious mix of appeasement and fear in its foreign policy has beleaguered its sovereign claim and resulted in a position of subjugation to China’s solution to the South China Sea dispute.

Joining the bandwagon of the Belt and Road Initiative, the government has pronounced that it will set aside the arbitral award and pursue bilateral agreements. Clinging to the promise of Chinese investments to fund its infrastructure projects, the government has been led into the trap of an expansionist agenda.

However, it is simply incredible to argue that we need Chinese investments to fund the “Build, Build, Build Program.” This is because, given all its infrastructure projects, it is the government that stands to bear 66% of the costs. Consequently, this government has embarked upon an expansive fiscal policy.

Ergo, there is a big disconnect between the goal and the means to achieve it.

The lurking problem is quite clear. Appeasement and fear produce compromise, and to use our sovereignty as a bargaining chip to develop the West Philippine Sea is at the onset a misnomer and outright capitulation.

Further, subscription to China’s Belt and Road Initiative starkly compromises an independent stand in the dispute and cascades complicated responses. The polarizing effect of compromise to the international and regional community would, in all respects, weaken the capacity of parties in interest to assert their claims.

Lest we forget, the perception of the general Philippine population is another factor that needs to be considered. There is a standing general distrust with regard to China; on the other hand, the level of trust accorded to the US, Japan, and Australia is considerably higher. In this regard, in these disputed waters where “might is right,” the revitalization of the 2017 Quadrilateral Security Dialogue involving the United States, Japan, India, and Australia is an imperative.

As for the ASEAN, its continuing relevance amidst this dispute could be demonstrated by asserting the collective sovereignty of member countries, the adherence to international law and a rules-based order, and by avowing the implementation of a binding Code of Conduct in the South China Sea.

To celebrate and advance the “right makes right” principle and wave the Philippine flag in the West Philippine Sea, the Stratbase ADRI Institute is holding a forum entitled “Three Years After Our Nation’s Arbitral Victory: An Environmental Crisis.” This will be held on July 12 at the UP Bonifacio Global City.

The half-day affair aims to achieve a two-fold objective. First, the activity is meant to step-up pressure for the government to uphold its national mandate of protecting our territorial integrity against a foreign aggressor and uphold the arbitral award. Second, it ventilates a “whole-of-society” approach in communicating our legitimate claim to the national, regional, and international arenas. Non-state actors, civil society organizations, the academe, the private sector, and every Filipino should take part in advancing our national interests.

And aside from the sovereignty issue that the dispute has galvanized, an equally important front that is at stake is the state of environmental destruction in the area. The environmental and economic security of the South China Sea concerns the welfare and livelihood of millions. Disgustingly, Chinese fishing and military activities have destroyed coral reefs and continue to degrade the marine environment and adversely affect biodiversity.

Toward its fourth year in office, it is high time for the Duterte administration to judiciously balance between national and political interests and between negotiation and capitulation.

While it could be argued that President Duterte has the prerogative of accommodating Chinese expansionism, it could also be well argued that Chinese investments are much less important than our sovereignty; and much less important than the lives of millions of Southeast Asians and their environmental security.

 

Prof. Victor Andres “Dindo” C. Manhit is the founder and managing director of the Stratbase group and president of its policy think tank, the Albert del Rosario Institute for Strategic and International Studies (ADRi).

Being in the Internet spotlight and Intellectual Property Rights

For quite a number of us, a significant chunk of the things we learn comes from the internet. The internet will likely have information that will satisfy an individual’s intellectual desires. A popular source of information are online video blogs or vlogs. These vlogs present information through a combination of video clips, supporting texts, and images. There has been an increasing preference for these vlogs since information is presented in a more entertaining, if not more palatable, manner than its text counterpart.

Vlog subjects range from cooking tutorials, product unboxing, do-it-yourself tutorials, home remedies, foreign language tutorials, fan fiction stories, movie commentaries, life hacks, game cheats, food review, travel, lifestyle and exercise, and a whole lot more. We find these vlogs on the usual video sharing platforms or on social networking sites which have video sharing capabilities.

Behind these vlogs are the so-called “content creators” — individuals who generate ideas regarding a topic, plan out how that idea can be expressed, and execute that plan. Most of these content creators make vlogging an occupation by monetizing their views through channel subscriptions and profit sharing with their different advertisers. Considering that vlogging has now become a particularly lucrative profession, those who intend to become content creators and those who already are may do well to familiarize themselves with the intellectual property rights and issues which tag along in their very interesting business.

A possible threat for these content creators would be the infringement of their work. Copyrightable material protected under Republic Act No. 8293, or the Intellectual Property Code of the Philippines (“IP Code”), refers to either original literary and artistic works and to some derivative works. Literary and artistic works, according to Sec. 172.1 of the IP Code, are intellectual creations in the literary and artistic domain that are protected from the moment of their creation. The same provision also lists down the works that are considered literary and artistic — which include audiovisual works, e.g. a content creator’s vlog. Note that under the law, no registration is needed for copyrightable material to be protected under the law.

Owning a copyright over a particular creation provides content creators with economic and moral rights. These rights give content creators the exclusive right to prevent a reproduction of his or her work and other forms of communicating the work. They also have the right to require proper attribution, restrain alterations, and prevent subsequent publication of their work. Any violation of these rights equips a content creator with grounds to enforce his or her rights in accordance with the IP Code and other relevant statutes. Under the law, violators may be imprisoned, fined, or sued for damages. However, content creators must also be aware that these rights may only be enforced within the specified term as provided by law.

Content creators should also consider the different licensing and technical intricacies regarding their use of a particular platform. For example, in the well-known video sharing platform YouTube, content creators may choose to provide third persons with the permission to use the former’s work. According to YouTube’s support page, content creators may mark their videos with a “CC BY” license. A CC BY license is a Creative Commons license which lets content creators retain their copyright over their work notwithstanding another’s use of such work. Hence, the IP Code may still apply in case of a borrowed work. Under the IP Code, these borrowed works may be considered as derivative works. They are translations of any copyrightable material under Sec. 172.1 of the IP Code which may also be protected. Sec. 172.2 of the IP Code however limits the protection in that such derivative work does not affect the force of any subsisting copyright upon the original work or any of its parts and it cannot be construed that the translation of an original material vests the owner of the derivative work with any copyright over the original material or give any extension of copyright on the derivative work. Also, it should be noted that a claim of fair use only applies insofar as non-commercial use of a work is concerned.

The rules, in effect, call for a cautious reliance on the licenses and a familiarization with the limitations inherent in using another’s work under the IP Code and the Creative Commons licenses, lest a content creator expose himself or herself to possible charges of infringement.

Undoubtedly, these safeguards will provide content creators with a greater incentive to create more vlogs which could help propagate a culture of information among digital citizens, if not the whole world.

This article is for general informational and educational purposes only and not offered as and does not constitute legal advice or legal opinion.

 

Josemaria Carlo F. Magsino is an Associate of the Intellectual Property Department of the Angara Abello Concepcion Regala & Cruz Law Offices (ACCRALAW).

830-8000

jfmagsino@accralaw.com

The slimy logic of politicians

The sinking of a Filipino fishing boat in Philippine waters by a Chinese vessel and the way the government of President Rodrigo Roa Duterte has handled the incident have delivered a clear message to the Filipino people.

This government would rather not ruffle relations with China, whatever the provocation might be, because it has resigned itself to being bullied and it is still hoping to extract economic benefits and loans from our gigantic neighbor.

In a statement to the media, Duterte tried to minimize the seriousness of the incident by applying his usual gangster logic: “Walang namang namatay, eh.” (Nobody died).

Duterte conveniently glossed over the fact that 22 of his Filipino constituents could have drowned in the high seas and that the incident was a transgression of Philippine territorial integrity.

Even a tiny ant would bite you if you step on it — but Duterte is so scared of China’s military might (and, perhaps, of economic sanctions) that he would rather rationalize China’s bullying tactics.

It’s a lapdog attitude. But nothing could have been more scandalous as ass-kissing goes than the attempt of Senate President Tito Sotto to rationalize Duterte’s un-presidential reasoning by making a TV comedy joke out of it.

Maybe, he reasoned, the Chinese boat was looking for Chinese fish in Philippine waters. Nobody laughed. Embarrassed, Sotto sheepishly explained that he said it “tongue in cheek.” Trigger-happy social media punsters ripped Sotto’s logic as “tanga” (stupid) and “intsik” (Chinese).

It’s slimy logic like that of Duterte and Sotto, where black is rationalized as white or at least shades of gray, that brought to mind a satirical piece that I wrote back in 2005.

It was about how Philippine authorities would have handled a local version of the historic Watergate burglary that resulted in the resignation of President Richard Nixon.

Note that I wrote this during the incumbency of President Gloria Macapagal-Arroyo and those currently in the “opposition” were in positions of power. This tells us that all politicians are the same, slimy logic and all.

Here are excerpts from that piece of satire. If you think it won’t happen in our country, it has happened and will continue to happen whoever is in power.

WATERGATE, PHILIPPINE-STYLE
“When Samuel Ong, the former deputy director of the NBI, revealed that he had personal knowledge of the alleged wiretap of Arroyo, why did the authorities immediately accuse him of wrong-doing?” one of them asked. “Wasn’t he, in fact, doing something right?”

He gave the example of Mark Felt, the former deputy director of the FBI, who turned out to be the “Deep Throat” who had provided damaging information to Washington Post reporters Carl Bernstein and Bob Woodward that brought down the Nixon presidency.

“He did the right thing, didn’t he?” the fellow continued. “Yes, but note that he refused to reveal his identity,” said another guy at the bar. “Maybe he was scared that he would be liquidated or, at least, discredited so badly by Nixon’s torpedoes that he would lose his credibility.”

This started a discussion on how the Watergate scandal would have turned out if it had happened in the Philippines. Johnny, a frustrated fiction writer, volunteered the following scenario:

Scene One: The Spring Watergate Hotel in Makati, one of Metro Manila’s plushiest addresses and headquarters of the opposition party, which threatens to unseat the current administration in the forthcoming presidential elections.

Four operatives of the administration are caught breaking into the opposition party’s office in order to bug it. An alert security guard catches them redhanded.

In the Watergate incident, the alert security guard, Frank Wills, turned the burglars over to the cops. In our fictional Spring Watergate incident, any of the following would happen:

Option One: The burglars identify themselves as agents of the ISAFP, the NBI, and the PNP, looking into reports of terrorist activities of the opposition party.

“Are you sure you’re not one of the terrorists?” one burglar-cum-agent asks the security guard.

“No, sir. No, sir. As a matter of fact, sir, I have nothing to do with this office. Diyan na kayo, sir. Tawag ako ng misses ko (You can stay there, sir. My wife is calling).” Option Two: The alert security guard calls the PNP and turns over the burglars to them.

“Sir, I caught these four men breaking into the office of the political opposition,” says the security guard.

The head of the PNP team turns his flashlight on the four burglars and immediately snaps to attention, along with a crisp salute: “Ay, sir, excuse me, kayo pala (Oh, sir, excuse me, it’s you).”

Then turning to the security guard, the head of the PNP team threatens to arrest the poor fellow for obstruction of justice.

The folks at my favorite watering hole shake their heads in dismay, realizing that alert security guards don’t stand a chance in a Philippine version of Watergate.

But, wait, they said, what about the Philippine version of Bob Woodward and Carl Bernstein, doggedly pursuing the case?

Johnny, the frustrated fiction writer, has a corresponding scenario: Conrad de Curious and Max Solving, the star reporters of the Maharlika Times somehow manage to get information about the burglary.

By a stroke of luck, they receive a call from someone whom they refer to as Sore Throat. He is willing to provide incriminating information. But he wants to remain anonymous. De Curious and Solving break the news with a banner headline:

“Administration hoods break into opposition headquarters.”

In the Watergate incident, the exposé of Woodward and Bernstein prodded Capitol Hill to conduct an investigation that, eventually, led to Nixon’s resignation. How about the Spring Watergate affair? Any of the following situations could occur:

Situation One: Presidential Spokesman Tito Bonito declares with righteous indignation at his weekly press briefing: “This is another attempt at destabilization. The opposition will do anything to cast the administration in a bad light — even to the extent of concocting a tall tale about a burglary.”

Situation Two: House Speaker Jose de Venice dares the media to produce proof and also to identify the purported source of confidential information: “If he refuses to be identified, he has no credibility. For all we know, these media people are inventing their facts.”

Senate President Frank Drilling calls for calm. “We must not jump to conclusions. Let us hear everyone’s side. Let the media provide proof. The Senate will investigate. But only if there is a prima facie case.”

Expectedly, because Sore Throat refuses to be identified, the burglary scandal suffers the same fate as the Jose Pidal scandal. No proof. No case. No story.

Situation Three: Conrad de Curious and Max Solving are suddenly picked up in an early morning raid by military intelligence operatives who have received a tip that they are trying to destabilize the government.

Two days later, De Curious and Solving appear in a press conference to reassure everyone that they are safe and that the whole controversy was “just a misunderstanding.”

Situation Four: After the banner headline, no more is heard about De Curious and Solving. There are conflicting reports that they have immigrated to America, taken refuge in a Catholic seminary, or have joined the MILF.

Situation Five: The administration party threatens to sue De Curious and Solving for libel. The owner of Maharlika Times is also threatened with a multi-million dollar lawsuit. He hurriedly turns over ownership of his paper to financial genius Mark Jimminy Cricket, leaving De Curious and Solving jobless. No jobs. No headlines. End of story.

The folks at my favorite watering hole listen to the various situations in silence. Finally, someone speaks out.

“In the US, Mark Felt, who turned out to be Deep Throat, has been hailed as a hero,” said one of them. “Shouldn’t that be the case with Samuel Ong? Shouldn’t he also be hailed as a hero?”

“I guess so,” said Johnny, the frustrated fiction writer. “But, take note that in the Philippines, they only officially declare heroes when they’re dead.”

 

Greg B. Macabenta is an advertising and communications man shuttling between San Francisco and Manila and providing unique insights on issues from both perspectives.

gregmacabenta@hotmail.com