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SMC to ‘invest heavily’ in renewable energy

DIVERSIFIED conglomerate San Miguel Corp. (SMC) plans to build up to 10,000 megawatts (MW) of renewable energy facilities in the next 10 years, adding to its existing installed capacity coming mostly from traditional coal and gas power plants.
“San Miguel is going to invest heavily on renewable energy,” Ramon S. Ang, SMC president and chief operating officer, told reporters.
Among renewable energy resources, he identified hydropower, wind, ocean tide and battery storage as the company’s possible investment ventures. He declined to disclose details on which of these will corner the biggest share, saying competitors might beat him in the projects.
“We predict to invest up to 10,000 megawatts in the next 10 years,” Mr. Ang said.
He said the required investment in renewable energy would be substantial as these remain costlier to build than a coal-fired power plant, except for solar energy. He brushed off solar energy, saying its availability is limited as experienced by other countries that had to resort to other sources to maintain the delivery of the required power capacity.
“The idea is to put up as many as possible,” Mr. Ang said, adding that each of the target projects has a good potential even the small ones.
“Sana (Hopefully), each hydro can produce 1,000 MW,” he said.
Mr. Ang said initial studies have shown good “wind profile” in an area in Luzon, which the company is considering to build a wind farm. He said a wide area within the country’s main island remains viable for a wind energy project.
“We have a report already — a very good wind profile, a very big capacity can be installed. And the land for that project is already owned by San Miguel,” he said.
SMC, through its energy subsidiaries, has an installed capacity of around 4,000 MW after the addition of the 630-MW Masinloc coal-fired power plant, which it bought for $1.9 billion in December last year from the equity holders of the plant’s owner Masin-AES Pte. Ltd.
In the same media briefing, Mr. Ang gave an update on the case between SMC unit Petron Corp. and state-led National Oil Co. (PNOC).
In October last year, Petron Corp. filed a case against PNOC for breach of a binding and compulsory sale-leaseback contract, which the listed company said threatens to hurt its operations, its shareholders and the Philippine economy.
Petron had asked the Mandaluyong Regional Trial Court for the issuance of a temporary restraining order to “stop PNOC from performing acts aimed at ousting Petron of its leased properties.” The company sought the court’s help over PNOC’s “threats, breach of sale and leaseback agreement.”
Petron said it had offered to negotiate the agreement with PNOC as early as 2016, but it had been constrained to seek judicial intervention after the government company said earlier last year that it would terminate the lease.
Mr. Ang said depending on the outcome of the case, he might elevate the legal dispute for international arbitration.
The case stemmed from a notice from PNOC directing Petron to abandon and clean up the contested sites on or before expiration of the lease, which is in August this year. Petron said PNOC had offered the properties covered by the leases to interested new independent oil companies, “in total disregard of the rights of Petron.”
Petron has existing lease agreements with PNOC for the sites of its $3-billion refinery in Bataan, 24 bulk plants and 67 gasoline stations. The company supplies more than a third of the country’s petroleum requirements.
Mr. Ang said Petron’s leased properties are originally owned by it and acquired over several years to be used for its refinery, distribution and sales operations. Petron, however, was compelled to give up its land to PNOC in 1993 to comply with the requirements of its privatization.
“To secure foreign and local investments in Petron and ensure stability of its operations, the transfer of the properties was enabled through a deed of conveyance and lease agreements that guaranteed its long-term and continuous use by Petron,” the company previously said. — Victor V. Saulon

State bank eyes bigger stake in fixed-income bourse

LAND BANK of the Philippines expects to buy more shares in the fixed-income bourse once the two have signed a share purchase agreement (SPA) in the coming weeks.
Alex V. Buenaventura, the state-run bank’s president and chief executive officer, said the signing of the SPA with the Philippine Dealing System Holdings Corp. (PDSHC) had been pushed bank because of “internal procedures.”
“Hindi pa (Not yet). We have procedures in finalizing it,” he said in an interview during a reception hosted by the Bangko Sentral ng Pilipinas on Friday.
Earlier this month, Mr. Buenaventura said shareholders representing 43% of PDSHC had accepted the bank’s offer to buy the bourse’s shares, with the SPA expected to be signed around that time.
He said that the lender had not received additional sellers who wish to sell their shares in PDSHC.
“Wala pang (There are no) additional sellers on top of the 43% that we got three weeks ago,” he said.
He noted that shareholders had signed nondisclosure agreements to proceed with further negotiations before the SPA for shares in the PDSHC is finalized.
The bank’s chief executive added that he expects the SPA to be signed within the next two weeks as the sellers are getting weary.
“I don’t want to give a deadline but for me, my deadline is within the next few weeks because the sellers are getting apprehensive,” Mr. Buenaventura said.
“I personally hope that we can do this within the next two weeks.”
In June, the bank said the Philippine Stock Exchange (PSE), which had earlier planned to take over the PDSHC, has indicated interest in selling its shares.
The bank offered to buy the shares in the fixed-income market at P360 per share, higher than the PSE’s P320 apiece offer in its previous SPAs that already lapsed.
However, only one shareholder has accepted the bank’s offer in April. Mr. Buenaventura said that once PSE agrees to the terms, others may follow.
The government wants to take at least a majority stake in the fixed income bourse through the bank to expedite the development of the capital markets and to improve the bank’s finances to deliver more robust credit for farmers and small enterprises.
The state lender currently owns 1.56% of PDS through the Bankers Association of the Philippines, which holds a cumulative 13.26% share for itself and its member banks.
The planned PSE-PDS merger had dragged on due to the PSE’s failure to secure exemptive relief from the Securities Exchange Commission on the 20% single-industry ownership limit. — Karl Angelo N. Vidal

RFM counts on flour mill upgrade to remain competitive as costs rise

RFM Corp. is banking on the upgrade of its flour mills to help it stay competitive in the market, as it continues to see rising prices of raw materials due to the weakening peso.
RFM Chief Financial Officer Enrique Oliver I. Rey-Matias said the capacity upgrade would improve competitiveness against other players, especially at a time when input costs are rising due to the weaker peso.
The listed ice cream and flour manufacturer earlier said it was investing P240 million to enhance the quality of flour it produces. RFM imports the wheat it uses to make flour from the United States, Australia, and Canada, among others.
“So essentially may (there are) ups and down sa (in the) price of raw material. Despite the ups and downs, price of flour is steady. Bottomline, there’s more supply to meet the growing demand. In that respect, you see more competition,” Mr. Rey-Matias told reporters after the company’s annual shareholders’ meeting in Mandaluyong last week.
“Kaya kami nag-upgrade ng flour (We upgraded our flour) so we can maintain our price and increase our volumes,” Mr. Matias said.
RFM’s share in the local market for flour is currently below 10%.
To offset the weaker performance of its flour business, RFM is focusing on strengthening its ice cream business, citing the potential to tap markets in the country, a large part of which remain underserved, Mr. Rey-Matias said.
“There’s a lot of people wanting to eat ice cream during a lot of occasions. What we’re doing is putting the ice cream freezer closer to the consumer,” he said.
RFM is one of the companies behind the Selecta ice cream brand, which was created through a joint venture partnership with global consumer goods giant Unilever.
Mr. Rey-Matias said RFM is deploying more ice cream freezers in sari-sari stores and local groceries to bring the Selecta brand closer to more Filipinos. In addition, it is also investing P1.1 billion to expand its current capacity for ice cream.
“Based on our estimation, this is enough to support the growth of our fast growing ice cream business over the next four years,” he said, noting that the demand for ice cream has been steadily growing in previous years, leading to the full utilization of most of its production lines.
Sales of Selecta ice cream jumped by 11% during the second quarter of 2018, which in turn supported a double-digit increase in the company’s revenues.
RFM recorded a 3% increase in net income attributable to equity holders of the parent to P525 million during the first six months of 2018, driven by an 11.6% jump in revenues to P6.31 billion.
For full year 2018, the company expects to sustain a double-digit growth in revenues and high-single digit increase in net income. — Arra B. Francia

Jewelry for millennials


IN THE hands of Manila’s mahjongeras lies the past and present of the jewelry trade. Huge stones and statement pieces sit on the hands and necks of maturing women, leaving a huge gap on the fingers of minimalist millenials.
Most millennials, said to be the world’s poorest generation, will have to forego the luxury of owning fine jewelry. But that does not mean they have to forgo jewelry altogether.
Enter Suki, a jewelry brand by husband and wife team Aaron and Sharlynne Cabigas. It pushes itself as a jewelry brand ready, willing, and able to sell to millenials through solid gold and gemstone pieces that are minimalist, tapping into the millennial aesthetic, and, which are, more importantly, quite affordable. Pieces by Suki can range in price from P3,000 to P50,000.
According to Ms. Cabigas, her partner and husband Aaron comes from a family of jewelers and the couple noticed that their peers couldn’t relate to the designs being made by Mr. Cabigas’ family. They were too intricate, too fancy, and probably much too expensive. Thus, Mr. Cabigas began to design simpler pieces, which BusinessWorld saw in Makati late last week.
There were simple rose gold pieces studded with small diamond baguettes forming the shape of a feather, and very simple thin rings with a single diamond dot which are designed to be stacked together. As for earrings, standing out among many other designs was a thin hoop surrounded a cluster of gemstones, forming a halo.
The designs create the impression that they are worn by you, instead of the other way around.
“The main inspiration is the modern individual,” said Ms. Cabigas. Note that she didn’t allude to any sex or gender when expressing this: the pieces are so simple that anyone of any stripe could wear them.
Discussing the sale of jewelry to a generation reluctant to shell out money for baubles, Ms. Cabigas said, “It’s a very daunting task…, to introduce solid-gold pieces to millennials.”
According to her, millennial reluctance to shell out money for jewelry (aside from the obvious fact that many are quite broke) is due to their not being ready to do so, to having a sense of intimidation over making the investment, and in some cases, they may just not like jewelry (when trips to Bali are well within reach). “I feel like, there’s a lack of knowledge and education, that really, solid gold can actually be accessible.”
While older women hold the cards in the jewelry game, their progeny might be lucky enough to inherit a few pieces, but few of these younger people actually own pieces that are wholly theirs, with their own style splashed across it instead of the memory of lola firmly encrusted in a pair of earrings.
“Traditionally, we wait for someone to buy a piece for us,” said Ms. Cabigas. “We want you to have that freedom…, that access. We want you to buy jewelry for yourself.”
That’s sort of the reason for the name.
Suki in Filipino means a trusted source, and implies a strong customer-client relationship. On the other hand, according to Ms. Cabigas, “suki” in Japanese means “to like, or to love.”
“We want you to buy jewelry for your special loved ones, or, really, for yourself. That’s who you are, your own special loved one.” — Joseph L. Garcia

LRWC’s Boracay resort on track for 2021 opening

LEISURE & RESORTS World Corp. (LRWC) said it remains on track to open its $550-million integrated resort in Boracay by 2021, denying that the project has been delayed due to the island’s six-month closure since April.
LRWC Vice-President and Compliance Officer Katrina L. Nepumoceno explained that the timeline for the project construction remains, given that the company has already secured the property in November 2017, long before the island was closed for rehabilitation three months ago.
“We were able to finish what we needed to do prior to closing. The focus now is to participate in all stakeholders’ forum, the Boracay Task Force, so we can listen in to the plans, and make sure that our plans will be compliant with all environmental requirements,” Ms. Nepumoceno told reporters after the company’s annual shareholders’ meeting in Pasay City last Friday.
Once construction starts, it will take two years to finish the project, she said.
The 23-hectare project has drawn flak over the previous months for its inclusion of a casino. The company is partnering with Macau-based casino giant Galaxy Entertainment Group for the casino component, which it clarified will only cover a total of 7.5% of the project’s total floor area.
Despite opposition from President Rodrigo R. Duterte himself on building a casino on one of the country’s top tourist destinations, Galaxy Entertainment said it had already been issued a provisional license by the Philippine Amusement and Gaming Corp.
Ms. Nepumoceno said she was confident that the project will push through, given that the “president has also said that he wants to maintain Boracay as a primary tourist destination.”
The Department of Environment and Natural Resources has set the official reopening of Boracay island for Oct. 26, noting that a soft opening could be held in September so long as vital requirements — including the improvement of water quality in the island and its surrounding areas — have been addressed.
On the other hand, LRWC said it is investing P200 million to expand its operations this year, citing the improving environment for gaming in the country.
For its electronic Bingo (e-Bingo) operations, LRWC President Eng Hun Chuah said the plan is to expand 30 out of its 145 existing outlets to fast-track its growth, while also constructing 10 new outlets.
“We’re gonna expand our existing outlets, say we have 100 square meters, we’ll expand that to 200 (sq.m.). We have 145 e-Bingo outlets . . . This strategy will help us to expand faster,” Mr. Chuah said, noting that building an outlet from scratch usually takes one to one and a half years. In contrast, expanding their existing one will take four to five months.
The listed firm is also actively on the lookout for more slot machine outlets.
“We have actively been looking for places we can acquire . . . we’re looking for acquisitions of existing operations. We’re talking to some people,” Mr. Chuah said.
Asked on how big the market for slot machine operators is, he said he was counting around 19 to 20 players in Metro Manila.
LRWC’s net profit fell by 70% in the first quarter of 2018 to P82.42 million, with gross revenues also slowing down by 2% to P3.86 billion. — Arra B. Francia

LGUs reluctant to propose irrigation projects — PRDP

DAVAO CITY — Many farm areas around the country stand to benefit from an irrigation system, but proposals from local government units (LGUs) are thin on the ground, an official of the Philippine Rural Development Project (PRDP) said.
Danilo T. Alesna, PRDP-Mindanao deputy project director and an engineer, said one reason is that LGUs are not confident of having the technical capacity to put forward an irrigation project for funding under the PRDP.
“(They) are afraid they will not be able to pass the validation,” Mr. Alesna said in an interview.
He added that local officials seem intimidated by what they perceive to be very stringent standards set by the World Bank (WB), the main funding source of the PRDP.
Another reason, he added, is that LGUs are expecting the National Irrigation Administration to build the facilities for them, in the belief that the government agency has the funds.
“Irrigation facilities are among their lowest priority projects among the infrastructure projects that they propose to the PRDP,” he said, referring to LGUs.
Mr. Alesna, however, noted that one success story might encourage local officials.
Under the Mindanao Rural Development Program (MRDP), the predecessor of the PRDP, then Davao Oriental governor and now 1st District Rep. Corazon N. Malanyaon proposed an irrigation system for the town of Cateel as a means of improving production.
“(Former) Gov. Malanyaon did not think twice even when at that time, there was huge counterpart (funding) being demanded from LGUs,” Mr. Alesna said, although the LGU portion of the financing was eventually shouldered by the Department of Agriculture.
When the PRDP was being finalized in 2014, Carolina Figueroa-Geron, then leader of the WB team overseeing the project, said the Cateel irrigation facility can serve as a model for future projects under the PRDP.
“The project will serve as an example for people hit by (super typhoon Haiyan) because this project was also hit, not just once, but repeatedly by disasters,” Ms. Geron said then.
During the construction stage, the southern part of Mindanao was hit by typhoon Pablo (international name: Bopha) in December 2012, with the provinces of Davao Oriental and Compostela Valley among the most devastated.
The contractor abandoned the project due to the challenges in continuing with the works following the devastation in the area, particularly in Cateel.
This prompted Ms. Malanyaon to mobilize local resources and ordered the provincial government to take the lead in finding a way to complete it.
And they did, not far off from the original deadline set.
Ms. Geron said the irrigation facility, completed at a cost of P281 million, has proven to be resilient to climate change because the provincial government followed “the rules of implementation even with the challenges that they encountered.”
It has since benefited 13 farm villages covering 2,200 hectares in Cateel and has allowed farmers to go into three planting seasons annually, instead of just two. — Carmelito Q. Francisco

Treasury bills, 20-year T-bonds expected to fetch higher rates

By Karl Angelo N. Vidal, Reporter
GOVERNMENT SECURITIES on offer this week will likely fetch higher rates, with the Bureau of the Treasury (BTr) expected to reject all bids for the 20-year papers, as investors continue to wait for the local central bank to raise interest rates anew.
The Treasury is offering P15 billion worth of Treasury bills (T-bills) today. Broken down, the government plans to raise P4 billion and P5 billion through the three- and six-month papers, respectively, and another P6 billion in one-year T-bills.
The government will also offer on Tuesday P10 billion in reissued 20-year Treasury bonds (T-bonds) with a remaining life of 19 years and six months.
Traders interviewed last week said the T-bills on offer today will likely fetch higher rates, with one saying yields will go up by five to 10 basis points across all tenors from the previous auction.
Last week, the Treasury opted for a full award of the T-bills, borrowing P15 billion as planned, with total tenders amounting to P32.9 billion.
Rates of the three-month paper slid to 3.219%, while the average yields on the six-month and one-year noted climbed to 4.235% and 4.809%, respectively.
The trader added that the 20-year bond auction on Tuesday could fetch higher yields to near 7.25%.
The BTr partially awarded the reissued 20-year T-bonds it offered on June 19, raising just P4.12 billion out of the planned P10-billion borrowing.
The bonds fetched an average rate of 6.979%, higher than the 6.85% average previously fetched as well as the 6.5% coupon rate.
However, another bond trader said the 20-year papers could be met with higher bids due to lack of interest from investors.
“I’m not hearing any interest for the 20-year bond,” the trader said in a text message. “Most likely, it will be just a repeat of previous auctions wherein bids are much higher.”
The government decided to reject all bids on the seven-year bonds it offered two weeks ago. Had the BTr decided to accept all bids, the papers would have fetched an average rate of 6.621%, 64.5 basis points higher than the 5.976% tallied in the previous auction.
“Most likely, the bids will be rejected…especially now that the market is anticipating another rate hike,” the bond trader added.
The Bangko Sentral ng Pilipinas (BSP) has been hinting of another rate hike during its next monetary policy meeting in August to quell inflation expectations.
In a speech at a reception for the banking community last Friday, BSP Governor Nestor A. Espenilla, Jr. said the monetary authority is “ready”to follow through the two rate hikes it has implemented.
“In the face of rising threats to inflation, we hiked policy rates last May and June. We are ready to follow through to secure our inflation target,” Mr. Espenilla said, adding that the central bank remains firmly committed to its primary mandate of price stability.
The government reported earlier this month that inflation accelerated to a fresh five-year high of 5.2% in June.
Last month’s inflation print surged from May’s 4.6% figure and beyond the 4.3-5.1% estimate range by the BSP and the 4.9% estimate of the Department of Finance.
The BSP’s policy rates currently stand within a 3-4% range.
Meanwhile, the first trader added that investors will likely factor in inflation expectations as well as the weak peso in their bids.

Domestic sugar output can fill US quota — SRA

THE Sugar Regulatory Administration (SRA) said that the Philippines has sufficient output to supply the raw sugar cane export quota allocated by the US amid worries over domestic shortage for bottlers.
SRA administrator Hermenegildo R. Serafica in a phone interview with BusinessWorld said that the US sugar quota has been “all accounted for,” with the fourth and most recent shipment being the largest volume shipped.
“The sugar loaded in Negros [last Thursday] is around 31,125 metric tons (MT). This is quite big, the biggest volume,” he added.
The first shipment was around 30,000 MT, while the second and third shipments were 27,000 MT and 28,000 MT, respectively.
Mr. Serafica said that the remaining balance for the fifth vessel is about 15,155.15 MT.
“I have to check this [volume] with the US [Department of Agriculture] if it’s insufficient. We will [have to] see if it’s too small [and talk] to the traders that own these batches,” he added.
Philippine raw sugar exports must arrive at US ports between Oct. 1, 2018 and Sept. 30, 2019.
The US Trade Representative this month announced that the US has retained the Philippines;’ 142,160 MT export quota for raw cane sugar under the tariff rate quota (TRQ) scheme of the World Trade Organization.
This is the third-largest quota after those of Brazil and the Dominican Republic.
The TRQ sets a volume limit for goods which can enter the US at a lower tariff.
Mr. Serafica said that he has been issuing import clearances “almost every day” to ensure there is enough sugar in the country. However, he also reiterated that only bottlers are facing a drop in supply.
“That’s why we have this importation program: to really arrest the surge of domestic prices and ensure that there is enough supply,” he added.
The agency earlier said it expects to see a drop in production for the current crop year due to weather conditions and as sugarcane farmers take on construction jobs amid rising wages under the government’s infrastructure program.
The new tax law which made beverage makers reformulate their products to contain sugar instead of high-fructose corn syrup (HFCS) is also driving demand for sugar this year.
Citing SRA data, Mr. Serafica noted that sugar consumption rose 16.9% during the off-milling season. In the industrial sector, sugar consumption likewise increased by 19%, which was not supported by domestic production, which fell.
“The industrial segment saw an increase in sales volume. They thought that sales would drop but apparently it did not happen. We Filipinos love sweet things,” he added.
With the new crop year starting in September, Mr. Serafica noted that the retail prices for sugar are falling slowly, doing away with the need for the suggested retail price system for sugar that the SRA was advocating a few weeks back. — Anna Gabriela A. Mogato

Designing clothes with a story


AT SoFA Design Institute, madness breeds creativity — or is it the other way around? As a culminating activity for the school’s 24 fashion graduates this year, a public exhibition has been set up at Makati’s Power Plant Mall where original, eclectic, and whimsical clothes are on view.
“We believe that we have to explore creativity. We don’t want you inside the box. Don’t always think ‘this is for my client.’ Because, if that is your thinking process as a student, you are limiting your creativity right away,” said SoFA founder and president, Amina Aranaz,at the sidelines of the exhibit opening on July 27. “You have to go outside what you see in the magazines or runway. And then, after this expression of creativity and imagination [as a student], that’s when you can water it down.”
The result? A wild showcase of different voices, materials, and cuts.
“Our aim is to have a student find their unique voice. We don’t allow our students to look at pegs or what others are doing. By looking inside, that’s how you are able to come up with something unique,” said Ms. Aranaz, the woman behind the eponymous bag brand that has made it locally and globally.
The designers behind the exhibit — called Told: the stories within me — were given creative license to do whatever they wanted, just as long as their fashion story was cohesive and personal.
“We don’t teach how to edit, because if we do, then all the designs are going to be the same. We believe that what is lacking in the industry, and what will set you apart, is intense creativity. We can teach you how to edit, but only in terms of your story. Is this how you want your story [told]? Is your design language consistent with your story?,” said Ms. Aranaz.
The 24 students were asked to come up with six looks for the Power Plant mall exhibit.
The resulting inspirations the creations could even come from personal trauma.
One of the exhibitors, Jeremy Tan, 23, lost his father last year, and he used this as his inspiration instead of succumbing to depression.
Mr. Tan’s collection is called “I M U,” which stands for three things: the Intensive Medical Unit where his father was confined, “I Miss You,” and “I am you.”
“It’s a process of my feelings and how things were going on in my family,” he said of a set of distressed denim outfits which he called “Chaos,” “because that’s how was I feeling back then.”
His pieces are rather topsy-turvy but still have direction. The clothes were made from deconstructed denim, and the small details like the use of detached thread, color (mustard), and white patches, were reminders of his father’s death.
Despite being inspired by his father, his collection — a denim dress and a denim top is women’s wear. “Why not a men’s collection as a tribute to my father? It’s because when I look at it, I think of my mom. She’s gone through a lot of pain at that time,” he said.
“I used it as a therapy. It’s a reminder that my father loves me,” he said.
The 24 collections are on view at Power Plant Mall until Aug. 2. — Nickky Faustine P. de Guzman

Antitrust watchdog seeks longer period for M&A review

THE PHILIPPINE Competition Commission (PCC) wants more time in reviewing mergers and acquisitions, saying the current deadline is “very tight.”
“Just to compare it with other jurisdictions, ‘yung timelines nila for phase one and phase two are even longer than ours . . . So ‘yung 60 days, 60 calendar days, for phase two, very tight po siya,” said Lawyer Amabelle C. Asuncion, one of the anti-trust body’s commissioners.
(Compared with other jurisdictions, their timelines for phases one and two are even longer than ours . . . So the 60 calendar days for phase two is very tight.)
“And when mergers go to phase two, it means it’s a problematic merger. So we really need that time,” she said during a congressional committee hearing on competition last week in Pasay City.
“Of course, it doesn’t mean we will always exhaust the 60 days but to the extent that we have that period of initial review and make correct assessments, kailangan po talaga namin ‘yon (we really need it),” she added.
The official was responding to lawmakers who opened the floor for the PCC to make requests or appeals.
In a separate interview, Ms. Asuncion said the agency’s legal division is already reviewing the proposal to stretch the timetable.
“Pinagaaralan talaga ‘yan ng legal team namin (Our legal team is really studying it). So we’ll come up with, I don’t know if it’s a position paper or a lobby,” she added.
The request would call for an amendment of the Philippine Competition Act of 2015, which states that “in no case shall the total period for review by the Commission of the subject agreement exceed ninety (90) days from initial notification by the parties.”
This covers phase one’s 30 days and phase two’s 60 days, which are both calendar days.
“So sometimes, parties will file their notification on a Friday, so it’s really very tight,” Ms. Asuncion said.
She added that some jurisdictions, such as the United States and the European Union, grant their anti-trust bodies a so-called “stop-the-clock” power that allows them to suspend the review period in cases they deem necessary.
Ms. Asuncion said that power could be used to pause the countdown of their timeline, a mechanism that is useful when the commission awaits the response of parties, among other situations.
Ahead of the amendment, the PCC is working first to hurdle a bigger concern: Republic Act No. 11032, or the Ease of Doing Business Act of 2018 (EoDB).
“Mr. Chair, it’s posing some difficulty in our part. We are still hoping that we’ll not fall under that law because, as it is, the 30-day period to finish phase one is already very tight. The analysis that we have to do, the data gathering, is very intense. And that’s 30 calendar days. That’s not working days,” she said during the committee discussion.
“To subject us to this 20-working day period restriction is very challenging if we’re going to be covered by the law,” she added.
With the draft of the law’s implementing rules and regulations already complete, the PCC said it was fast-tracking to raise its appeal to the Department of Trade and Industry (DTI), which is the temporary secretariat of the Anti-red Tape Authority.
DTI Secretary Ramon M. Lopez had said that the agency would go through a consultative process as it comes up with a definition of “frontline” transactions, which the EoDB intends to cover to streamline business applications.
Aside from the PCC, the Intellectual Property Office of the Philippines has also raised concerns over the EoDB law and has already lodged to the DTI a set of recommendations for a fix. — Janina C. Lim

Banks given two months to gear up for InstaPay

By Melissa Luz T. Lopez, Senior Reporter
BANKS are given two months to get their online platforms ready to do real-time fund transfers under InstaPay, an industry official said, with only nine banks currently offering the full service.
Carmelita R. Araneta, general manager of Philippine Payments Management Inc. (PPMI), said the industry-led body has given all banks an October deadline to update their channels and do both real-time sending and receiving of money online.
“Right now, we only have nine banks who can both send and receive. We also have 18 banks who can only receive, but the ACH (automated clearing house) steering committee has given the deadline that by Oct. 1, all participant banks and institutions of the InstaPay should be able to send and receive,” Ms. Araneta said during a conference at the Bangko Sentral ng Pilipinas (BSP) last Friday.
Launched April 23, InstaPay clears electronic fund transfers worth up to P50,000 per transaction and without a daily limit. The platform is available 24/7, with the funds to be made available to receivers almost immediately.
The PPMI is an industry-led body tasked to perform oversight on the digital clearing houses and electronic banking channels offered by financial firms.
BSP Governor Nestor A. Espenilla, Jr. said separately that banks can only cash in on the InstaPay service if they are able to send money out, as they can only collect transaction fees from this end.
“The basic obligation to be a valid member is you have to receive, that’s mandatory. Then being able to send is a business decision,” Mr. Espenilla said.
“Our rule is sender pays. But if your operation only is to receive (money), hindi ka kikita (you won’t profit). That’s why the business incentive is to be a sender.”
The Asia United Bank, BDO Unibank, Inc., China Banking Corp., China Bank Savings, Equicom Savings Bank, Security Bank Corp. and UnionBank of the Philippines have been offering real-time sending and receiving services to its customers since InstaPay was launched. The Philippine Savings Bank and Metropolitan Bank & Trust Co. followed suit.
Meanwhile, 15 banks and three e-money issuers are able to receive interbank transfers as of July.
Clients of InstaPay participants maintaining savings, current or e-money accounts can use the platform to send or receive cash via cash transfer instructions made through online or mobile app channels.
InstaPay is expected to be high-impact as it is expected to give a substantial boost for e-commerce. This is the second clearing house launched under the National Retail Payment System, with the goal of raising the share of e-payments to at least 20% of total transactions by 2020 from a measly one percent recorded in 2013.
Mr. Espenilla also said the central bank is looking to require industry players to use a standard design for quick response (QR) codes to ensure efficient transactions across service providers.
QR codes are computer-generated images which are used for payments or fund transfers, and are readable using smartphone cameras. The BSP is expected to issue a circular on the matter, which will then push the PPMI to execute and comply with the standard among their member-firms.

2G ethanol overcoming technical glitches, seen competitive with oil at $70 per barrel

SAO PAULO — Second-generation ethanol production is overcoming the technical difficulties that had slowed its development and is now seen as commercially competitive with oil prices near $70 per barrel, industry representatives said on Thursday.
As countries worldwide prepare to deliver on their respective commitments to the Paris climate deal, growing global regulations that favor advanced biofuels and programs that put a price tag on carbon-based fuels are creating a more positive environment, biofuels executives said at the “Forum Brasil Bioeconomia 2018” seminar in Sao Paulo.
After years of investment and technical glitches, 2G biofuels, or cellulosic biofuels, are seen as the future of green fuels since they can be made from biomass, overcoming criticism about the use of food crops to produce fuel and sharply reducing carbon emissions from vehicles.
“We had that moment of excitement some years ago, then came a downsize with players leaving the arena due to big difficulties to operate plants in a stable way,” said Victor Uchoa, Latin America biorefining head for biotech company Novozymes.
“But that is in the past now, we are again in a ‘up’ moment. The Raízen plant is an example of that,” he said.
Brazil’s Raízen, a joint venture between Royal Dutch Shell Plc and Cosan SA Indústria e Comércio, is producing some 40 million liters of cellulosic ethanol per year at its plant in Piracicaba, Sao Paulo state.
“We solved the operational problems, production is currently stable and we are hitting the numbers we planned,” Raphaella Gomes, head of Raízen’s innovation arm told Reuters on the sidelines of the seminar.
Raízen has previously said that it sells all of its 2G ethanol at a price premium over regular, sugar cane-based ethanol, due to its environmental credentials.
Cellulosic ethanol in Brazil is mostly made from the cane waste from the production of sugar and ethanol. Novozymes supplied Raízen with enzymes used in the fermentation process, which was another technological challenge since the biomass needed a new type of fermentation to produce ethanol.
Mauricio Adade, head of Latin America at DSM, a firm supplying products for cellulose fermentation, said that in other countries — including the United States, where 2G ethanol is made from corn waste — production is very close to being financially feasible.
“With oil around $70 we can compete,” he said.
Adade expects strong demand from Asian countries such as China and India, which are seeking to drastically cut carbon emissions from the transportation sector. — Reuters

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