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Apple threatens to terminate Epic’s developer account

Apple Inc. threatened to remove Epic Games Inc.’s developer account, cut off its developer tools and limit its ability to supply key graphics technology to other apps in the latest skirmish in a battle over app store fees.

The iPhone maker’s plans were disclosed in a court filing by Epic on Monday. The developer has asked a California federal court to block Apple’s removal of the popular Epic game Fortnite from the App Store. Epic sued Apple last week over the move.

Epic also asked the court to stop Apple from terminating its developer account on Aug. 28. Epic said it will probably suffer irreparable harm if the court doesn’t order the Fortnite game app to be made available to smartphone users.

In a statement issued Monday, Apple said it won’t be making an exception for Epic Games and that the matter could be easily resolved if the company issued an update to Fortnite that brought it back within Apple’s established App Store guidelines.

“We very much want to keep the company as part of the Apple Developer Program and their apps on the Store. The problem Epic has created for itself is one that can easily be remedied if they submit an update of their app that reverts it to comply with the guidelines they agreed to and which apply to all developers. We won’t make an exception for Epic,” read the statement.

“The court cannot, on today’s motion, level the playing field against Apple,” Epic’s lawyers wrote in the filing Monday. “But the court can order that while its practices are being litigated, Apple cannot retaliate by blocking Fortnite and tools for the Unreal Engine and harm the hundreds of millions who—especially in this time of social distancing—use Epic’s software to play, build and stay connected.”

This represents a major escalation of an antitrust dispute that has been building for more than a year. Epic’s Unreal Engine is a suite of software tools used by millions of developers to build 3-D games and other products.

Cutting off Epic from Apple’s iOS and Mac developer tools would mean the gaming company can no longer distribute Unreal Engine to other developers, Epic said in its legal filing.

“I do think that is likely to be perceived as an overkill response. They are supersizing the confrontation,” said Lewis Ward, research director of gaming at IDC.

Other app developers that use Unreal Engine may be “held liable for what Fortnite did,” he added. “If that is accurate, then this is going to be a much bigger snowball.”

The removal of Epic’s developer account would mean that the game maker can’t sell new apps to more than 1 billion iPhone, iPad and Mac users. It could mean the removal of the company’s other games. It sells one game on the Mac App Store called Shadow Complex Remastered and another iPhone and iPad game called Battle Breakers.

The disagreement stems from a longstanding Apple App Store rule saying that games must bill their subscriptions and in-app-purchases through Apple’s billing system, which charges a 30% fee. On Thursday morning, Epic began offering customers a way to directly buy items for Fortnite and circumvent the fees. Hours later, Apple pulled the app. Google followed suit later in the day, removing Fortnite from its Play app store.

In its court filing, Epic highlighted comments from Apple Chief Executive Officer Tim Cook from a recent antitrust hearing in Congress. Mr. Cook was asked by lawmakers whether Apple has ever retaliated against a developer who complained publicly about the App Store. Mr. Cook said his company doesn’t “retaliate or bully people,” according to the filing.

“But Apple has done just that,” Epic wrote. — Bloomberg

Work-from-home boom is a bust for big office furniture makers

Experts predict the virus will largely kill off large offices as more companies find they can operate with workers dispersed, saving on costly real estate.

America’s biggest office furniture manufacturers got the rug pulled out from under them by the COVID-19 pandemic.

For decades, producers like Herman Miller Inc. and Steelcase Inc. focused on selling through their own dealers to companies that bought ergonomic chairs and desks by the truckload and employed teams of designers and technicians to deliver and install them. None of them were prepared for a flood of orders for a single adjustable desk from stay-at-home workers suddenly trying to figure out how to conduct Zoom meetings from spare bedrooms.

Early in the pandemic in late April, 52% of employed Americans said they were always working from home to avoid catching or spreading the coronavirus, while another 18% reported sometimes working from home, according to a survey by Gallup. A later survey found half said they’d like to continue doing this permanently—including 27% who cited both a preference for remote work and fear of the coronavirus.

When Alphabet Inc.’s Google told employees in May the company would reimburse up to $1,000 to outfit home offices, most of the options they found were inexpensive imports sold by big box stores or Amazon.

“A tsunami hit this industry with this pandemic,” said Ron Wiener, chief executive of iMovR, a maker of adjustable desks in Seattle. “The big companies simply weren’t structured to serve people from home.”

Steelcase, the largest US office furniture maker, and Herman Miller, the no. 2 producer, both reported steep losses and double-digit sales declines in the three months ending in May. For Steelcase, sales of about $483 million were the lowest since its initial public offering in 1998.

Investors have figured out just how dire their situations have become as some experts predict the virus will largely kill off large offices as more companies find they can operate with workers dispersed, saving on costly real estate.

Even as the wider stock market has nearly recovered all of its losses from the early days of the outbreak, shares of Steelcase and Herman Miller remain deep in the red. Steelcase shares fell 69% from their 52-week high after the pandemic hit—and are still off 51%. Shares of Herman Miller fell over 71% and are still down over 50%.

Herman Miller and others say they’ve made strides in expanding their online options since the pandemic hit and have found other ways to sell to individuals.

Lori Gee, vice-president of workplace performance services at the Zeeland, Michigan-based company, said they quickly set up a way for Google employees to buy directly from the company, for instance.

“Part of this has been an acceleration of what we were already doing—to make it easier to get the best set up,” regardless of where the furniture would go or the size of the order.

HIGH PRICES, LOGISTICS CHALLENGES
Manufacturers of many other goods have pivoted to new products, including things needed to fight the pandemic, or stepped up services to make up for other lost business.

Office furniture makers have had a harder time, in large part because of logistical challenges. The average work-at-home customer, for instance, wants a product that can be sent by a delivery service in a single box and can be easily assembled—ideally without needing special tools.

Price is also a factor. An Aeron chair, a classic design sold by Herman Miller, comes in versions that can easily cost $1,000. Workstations in offices can cost even more, depending on their complexity and added features, such as adjustable desktops and built-in arms to hold computer monitors. Workers stuck at home are far less likely to splurge on such expensive options, at least in part because many are worried about keeping their jobs.

The way big companies make their products is a complicating factor. Many producers have outsourced component production, buying bases from one company, for instance, desktops from another, and assembling them into configurations according to the design laid out for a large operation.

“We’re not used to dealing with the end user—if we get a call from a customer about a missing screw, we’re not set up to handle that,” said Soren Stig-Nielsen, president of LINAK US Inc., the US division of a Danish company that makes many of the world’s actuators for lifting bases on desks to adjust height. The company has a large factory in Louisville, Kentucky, and sells its equipment to most of the big domestic furniture companies, including Steelcase.

“COVID has created huge demand in the home office area,” said Stig-Nielsen, “and traditionally we have not been a big player in that market.”

Meanwhile, the industry is not giving up on actual offices.

Herman Miller’s Ms. Gee said it is unclear how long the slump in building new centralized offices will continue. But she said the company’s designers are already working on concepts for a new style of working, including more “small, satellite offices” that they believe companies will want to set up to serve workers more widely dispersed than in the past.

“We think there will always be the need for a physical workplace—places where you go for collaboration and bring to life the corporate culture,” Ms. Gee said.

Mystery grows over virus spread via contaminated food packaging

Cold-storage facilities and meat processing plants are ideal environments for the virus to spread, as the pathogen thrives in cold and dry environments. But there has been no concrete evidence the virus can be transmitted through food, and experts remain doubtful that it’s a major threat.

Evidence shows that food is an unlikely route of transmitting the coronavirus across borders, but contaminated items continue to grab the spotlight, deepening the uncertainty over whether the $220-billion cold chain industry could be implicated in the spread of COVID-19.

China has repeatedly found traces of the pathogen on packaging and food, raising fears that imported items are linked to recent virus resurgences in Beijing and the port city of Dalian. In the nation’s strongest action since it began testing food items in June, a major Chinese city on Sunday banned imports of frozen meat from coronavirus hotspots.

Cold-storage facilities and meat processing plants are ideal environments for the virus to spread, as the pathogen thrives in cold and dry environments. But there has been no concrete evidence the virus can be transmitted through food, and experts remain doubtful that it’s a major threat.

“We know that viruses usually can survive being frozen. So that means, in theory, it’s possible that infection could spread that way,” said Benjamin Cowling, head of epidemiology and biostatistics at the University of Hong Kong. “But in reality, it’s a very low risk that that would happen because so many steps would need to be involved.”

The virus would need to survive freezing and then defrosting. It would need to get onto someone’s hands and then into their nose or mouth, and still survive. “I don’t think it would be a frequent mode of transmission, but it is possible,” he said.

China’s top respiratory disease expert Zhong Nanshan, who advises Beijing on its COVID-19 response, downplayed the role frozen food can play in transmission. “It is relatively rare to detect the virus from imported frozen food,” he said. “Let’s not exaggerate it.”

GUANGZHOU BAN
Amid a lack of conclusive proof, China is taking precautionary steps, creating major disruptions with its trading partners. The Cold Chain Association of China’s southern coastal city of Guangzhou ordered all member companies to suspend imports of frozen meat and seafood from coronavirus-hit areas.

The order was issued after the local government in the nearby city of Shenzhen found the virus on a surface sample of chicken wings imported from Brazil. Hong Kong has also suspended imports from that plant.

China has otherwise refrained from wider nationwide moves against imported meat due to the reliance of its population on the food source.

New Zealand originally considered the possibility that a new cluster, which suddenly emerged last week after 102 days without a local virus case, could have been linked to a cold-storage plant, as the first person to test positive worked at an Auckland Americold facility.

RULED OUT
But preliminary findings from environmental testing at the plant have debunked the theory that the route of transmission was through chilled surfaces on materials arriving from overseas, Director-General of Health Ashley Bloomfield said Tuesday.

“The full report will have the details but it seems clear now that the possibility is being ruled out from that investigation,” he said.

A key unanswered question is whether the traces that China has detected on the packaging and surface of frozen foods are still viable and infectious, or whether they’re just dead and harmless vestiges of the pathogen.

“What we know publicly and what we’ve seen so far is that yes this virus can survive outside people for up to a few days, depending on the environment,” said Sarah Cahill, senior food standards officer at Codex Alimentarius Commission, the body responsible for developing food standards under the World Health Organization (WHO) and the United Nations.

“But what are we actually detecting when we do these tests?” she said. “Are we just detecting RNA, which just means maybe this virus is no longer viable, or is that virus still an infectious agent?”

It is not uncommon for a wide array of viruses, bacteria and parasites to be transmitted through contaminated food. The WHO estimates that almost one in 10 people in the world fall ill after eating contaminated food, leading to 420,000 deaths every year. Salmonella and the norovirus on produce or uncooked meat and seafood can cause symptoms like diarrhea and inflammation in the stomach and intestines.

While diarrhea can be one of the symptoms of COVID-19 as well, experts are more focused on the possibility of the virus jumping from surfaces to human respiratory systems when people touch their faces after coming into contact with a contaminated item. Even then, some consider that scenario far-fetched.

“Theoretically, it’s possible ,” said Takeshi Kasai, WHO’s regional director for the Western Pacific region, during an online briefing on Tuesday. “But so far our observations or the evidence coming from the past seven months of epidemiology: it is unlikely.” — Bloomberg

Regional Updates (08/18/20)

1 killed, infra damaged by magnitude 6.6 earthquake in Masbate

A MAGNITUDE 6.6 earthquake shook Masbate, an island province in the central part of the Philippines, at around 8 a.m. on Aug. 18. It was the strongest tremor so far in the country this year, killing at least one person and damaging private and public infrastructure, including buildings, roads, bridges, and health facilities being used for the coronavirus response. Most of the damage were in the town of Cataingan, the earthquake’s epicenter, based on the monitoring report of the Philippine Institute of Volcanology and Seismology (Phivolcs). The reported casualty was identified as Gilbert Sauro, a 63-year-old retired police officer. Maj. Maria Luisa Calubaquib, spokesperson of the Bicol police, said Mr. Sauro was brought to a hospital but died from injuries sustained from falling debris during the earthquake. Several other people were also reported injured.

Various intensity levels were recorded in the southern parts of mainland Luzon, most of the central islands in the Visayas, and some areas in northern Mindanao. Phivolcs logged at least 30 aftershocks as of early afternoon. — with a report from Emmanuel Tupas/PHILSTAR

Human rights activist killed in Bacolod

ZARAH ALVAREZ, a 39-year-old paralegal of human rights group Karapatan, was gunned down on Monday evening in Bacolod City. An initial report from the Western Visayas police said Ms. Alvarez was walking along Sta. Maria street when the suspect shot her six times. She instantly died from multiple gunshot wounds on the body, police said. Karapatan, in a statement, said Ms. Alvarez was the 13th human rights worker killed under the administration of President Rodrigo R. Duterte. “That she was gunned down merely a week after Ka Randy Echanis was brutally tortured and murdered — and on the very day he was buried — strongly suggests that these senseless and cold-blooded killings are part of an orchestrated murderous rampage to silence dissent, with human rights defenders as targets and fair game,” Karapatan Secretary General Cristina Palabay said, referring to National Democratic Front of the Philippines consultant Randall Echanis, who was killed last week in Quezon City. Ms. Alvarez was detained for almost two years in October 2012 along with 42 activists over murder charges filed by the military. She was released on bail in July 2014, and acquitted in March 2020 for lack of evidence, according to Karapatan. Justice Secretary Menardo I. Guevarra told reporters via Viber they may consider including Ms. Alvarez’ death for special investigation under the Administrative 35 task force, which probes extrajudicial killings. — Vann Marlo M. Villegas and Emmanuel Tupas/PHILSTAR

Maynilad to provide free water supply to quarantine facility in Parañaque

MAYNILAD WATER Services, Inc. will provide free water supply to a coronavirus quarantine facility that will be set up at the Bagong Nayon Pilipino  in Parañaque City. The free service will be until October, according to the company. The facility, which can house more than 500 mild and asymptomatic coronavirus disease 2019 (COVID-19) patients, is the fifth quarantine facility to receive free supply from the water provider. The others are at the World Trade Center, Philippine International Convention Center, Cultural Center of the Philippines Sunken Parking, and Rizal Memorial Sports Complex. “We are happy for the opportunity to help out in this way. Having a continuous water supply is essential for the daily operation of COVID-19 quarantine and testing centers,” Maynilad President and Chief Executive Officer Ramoncito S. Fernandez said. Maynilad said it also provided free water supply to the mega-swabbing centers of the Department of Health in Manila and SM MOA Arena in Pasay City. Metro Pacific Investments Corp., which has a majority stake in Maynilad, is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT, Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls. — Revin Mikhael D. Ochave

6-MW biogas project gets 10-year tax holiday from South Cotabato gov’t

SURALLAH POWER Generation, Inc. (SGPI) has been granted a 10-year real estate tax holiday by the South Cotabato provincial government for its six-megawatt biomass power plant. Governor Reynaldo S. Tamayo, Jr., in a statement, said the renewable energy firm met all the requirements for the incentive provided under the province’s investment code. “The business activity would be vital to the economy when it comes to capacity to generate employment and poverty reduction as well as adding value to the raw materials produced in the province,” Mr. Tamayo said following an evaluation by the local investment board on Aug. 5. The tax holiday will be in effect from 2021-2030. With the incentive, SGPI is required to submit a corporate social responsibility program and source at least 80% of its human resource requirement from the province’s labor force. “The province is willing to give more incentives to qualified investors who are willing to locate their businesses in South Cotabato,” Mr. Tamayo said.

COVID-positive Revilla transferred to hospital for pneumonia

SENATOR RAMON B. Revilla, Jr., who tested positive for the coronavirus disease 2019 (COVID-19) more than a week ago, was rushed to the hospital on Tuesday for pneumonia. “Father God please help my husband. He is being rushed to the hospital. His latest X-ray shows that he has developed pneumonia and isolation in a regular facility is no longer ideal,” his wife, Bacoor City Mayor Lani M. Revilla, said in a social media post. The senator confirmed on Aug. 9 that he contracted COVID-19 after a household member and one of his employees tested positive. Mr. Revilla is the fourth senator to have been infected by the coronavirus, after Senators Juan Miguel F. Zubiri, Juan Edgardo M. Angara, and Aquilino L. Pimentel III. Stricter quarantine measure has been imposed in the Senate over the last two weeks, which is scheduled to be lifted Wednesday. — Charmaine A. Tadalan

Eastern Visayas records highest number of new cases at 95, with 24 healthcare workers in Samar Provincial Hospital

THE EASTERN Visayas Region recorded its highest number of new coronavirus cases in a day at 95 on Aug. 17, with local transmissions accounting for more than half. The Department of Health (DoH) regional office said there are currently 637 active cases out of the 1,680 total. There are 1,036 recoveries and seven deaths. Of the new cases on Tuesday, Catbalogan City had the highest number at 24, all of whom are healthcare workers from the Samar Provincial Hospital who came in close contact with a confirmed patient. Catbalogan Mayor Dexter M. Uy, in a streamed message late Tuesday evening, appealed to the public to strengthen the observance of health protocols, saying this sudden surge in local transmissions should serve as reminder of the continuing health crisis. Speaking in Waray, Mr. Uy noted that in his rounds of the city, he has “seen many who do not seem to care about following policies on wearing of face mask and distancing.” The city, the provincial capital of Samar, currently has 55 active coronavirus cases. The region had one of the lowest number of cases in the country until end-May, when the locally-stranded residents and overseas workers started returning home.

‘Lockdown generation’: Over 1 million youths face job losses

YOUTH unemployment rate may hit double-digits this year, as companies lay off workers amid the pandemic. — REUTERS

MORE THAN a million young Filipino workers may lose their jobs this year, pushing the youth unemployment rate to nearly 20% as the coronavirus takes its toll on the labor market, the Asian Development Bank (ADB) and the International Labour Organization (ILO) said.

“Youth will be hit harder than adults in the immediate crisis and also will bear higher longer-term economic and social costs,” the ADB and ILO said in a joint report on the impact of the COVID-19 crisis on youth employment.

“Before the pandemic, young people were already facing challenges in the labor market. These are worsened by the COVID-19 crisis, and its multiple effects threaten to create a ‘lockdown generation’ that will feel the weight of this crisis for a long time,” it added.

The ADB and ILO estimated 687,000-1.019 million young workers aged between 15 to 24 in the Philippines could be out of  job this year, as it expects the economy to shrink by 3.8%. The government sees a full-year economic contraction of 5.5% this year.

Youth unemployment rate in the Philippines could reach 15.1% to 19.5% by the end of 2020, more than double 2019’s 6.8%.

However, the extent of the job losses may depend on how long it will take for the government to contain the COVID-19 virus. The ADB and ILO based the estimates on two scenarios: one where the spread of COVID-19 is contained within three months from onset and the other within six months (April to September for most countries).

The Philippines is now facing the longer, six-month containment scenario, as restrictions are still in place to control the rise in coronavirus infections.

Nearly a fifth (19.8%) of the youth job losses in the Philippines will come from hotels and restaurants, followed by retail trade (16.2%), agriculture (15.2%) and construction (12.9%).

The ADB and ILO said the 13 countries in the Asia-Pacific region covered by its report may see youth unemployment rates double this year. Joblessness among young workers in the region could range between 9.9 million and 14.8 million, although a longer containment period will result in more jobs lost.

Four sectors pummeled by the pandemic are wholesale and retail trade; manufacturing; real estate and business activities; and accommodation and food service sector.

“Nearly half of young workers in the region are employed in the four sectors hit hardest by the crisis. This is one of the reasons that young people face greater labor market disruption and job loss than adults due to COVID-19,” it said.

Citing previous studies, the ADB and ILO said young workers tend to suffer more from the long-lasting labor market impact of economic crises as the youth unemployment rate tends to rise faster than the adult rate during recessions.

Earning losses are also found to recover rather slowly, while the fewer job opportunities and lower income may delay their acquisition of productive assets such as properties.

Aside from job losses, young workers face reduced working hours, lower earnings, disruptions in education and training, and difficulties in transitioning from school to work.

Lockdown measures to curb the coronavirus has caused significant reduction in working hours, which fell 7.1% in the first quarter or equivalent to 125 million full-time jobs lost across the region, against the fourth quarter of 2019. In the second quarter, the ILO estimated a larger decline at 13.5% or a loss of 235 million full-time equivalent jobs.

Due to reduced working hours, young workers are more likely to suffer from outright job loss than temporary suspension since they have less job tenure and are “cheaper to fire.”

“Young workers who enter the labor market during a recession experience earnings and wage reductions. They are forced to compete with more job seekers (the majority of whom are more experienced) for fewer jobs. University graduates earn less for a decade or longer. In general the losses are more pronounced for disadvantaged entrants,” according to the report.

The ADB and ILO said the crisis in youth unemployment could be mitigated if governments will “adopt large-scale and targeted responses” that focus on improving labor market policies, and minimizing the impact of education disruptions.

Some recommended programs include wage subsidy for the youth, job creation, employment planning and job search, widening their access to training, and larger investments in youth entrepreneurship.

“Prioritizing youth employment and maximizing youth productivity in the COVID-19 recovery process will improve Asia and the Pacific’s future prospects for inclusive and sustainable growth, demographic transition and social stability,” they said. — Beatrice M. Laforga

Kingmaker Duterte’s political capital rests on Russian vaccine success

By Gillian M. Cortez, Reporter

REGINA S. VALDUEZA (not her real name), 24, has been staying at a government quarantine facility near the Philippine capital after she was diagnosed with the coronavirus on Aug. 12.

“I do trust I’ll be OK soon,” she said in a Viber message. “When you’re under quarantine, you just want to be OK as soon as possible.”

Ms. Valdueza is completely dependent on government health workers who have assured her that she will recover soon. “I hope trusting the government on this won’t bite me in the back one day.”

BW Bullseye 2020-focusAnalysts have criticized President Rodrigo R. Duterte’s reliance on a vaccine from both Russia and China to contain a coronavirus pandemic that has sickened nearly 170,000 and killed more than 2,600 people in the Philippines.

“The only salvation available to humankind at this time of life, if you are stricken with the virus, is always a vaccine,” the President said in a televised public address late Monday.

Analysts said Mr. Duterte’s political capital rests on the success of planned trials involving a Russian coronavirus vaccine.

“If this Russian vaccine succeeds, then good for our country,” Marlon M. Villarin, a political science professor from the University of Santo Tomas, said in a Viber message. “If not, it could be the endgame for Duterte politics.”

Mr. Duterte, who volunteered to get a shot of Russia’s Sputnik V vaccine, is under pressure to stop a fresh surge in COVID-19 infections, leading him to put Metro Manila and nearby provinces back under a strict lockdown until Aug. 18.

The President, down to his last two years in office and barred by law from seeking reelection, is also hard-pressed to keep his political capital and ensure the victory of his chosen candidate in the 2022 presidential elections. At least three presidents before him had either been sued or jailed for corruption.

Russian President Vladimir Putin on Aug. 11 said his country had developed the first vaccine for the coronavirus. Critics have questioned the safety of the vaccine from the Gamaleya Research Institute of Epidemiology and Microbiology since vaccines take years to develop.

‘FATHERLY GESTURE’
The Philippines and Russia seek to run phase 3 clinical trials of the vaccine from October to March, and these may involve as many as 3,000 volunteer patients, presidential spokesman Harry L. Roque said last week.

Mr. Duterte, who’s been isolated after being exposed to a Cabinet official who had tested positive for the virus, should take steps to stop the spread of the coronavirus instead of relying too much on a vaccine that may take long to mass produce, said Maria Ela L. Atienza, a political science professor from the University of the Philippines.

Using mostly poor patients in the Russian vaccine trials also raises ethical issues, she said in an e-mailed reply to questions.

“The intention of the President in accepting this offer from Russia is more of a political/diplomatic strategy,” Ms. Atienza said, noting that Mr. Duterte has tried to expand relations with Russia and China since he took office in 2016.

“Given the rising cases of infection, he needs to also show that he is doing something and Russia was the first country to announce a vaccine,” she added.

Mr. Duterte appears to have hastily announced Russia’s vaccine offer without consulting local Health authorities, which is problematic given people’s diminished trust in vaccines amid a still unresolved issue involving Dengvaxia, Ms. Atienza said.

“There are still questions from scientists and medical experts worldwide about the vaccine’s hasty approval without adequate proof of its efficacy,” she added.

“For the educated and technical citizen, to consider the Gamaleya vaccine is like sending your people straight to the slaughter house,” Mr. Villarin said.

But most Filipinos might see it as a “fatherly gesture” after Mr. Duterte said he would sell government assets so he could buy more vaccines once these become available.

‘RIGHT POLICY’
“The diplomacy of the President is the right policy,” his chief lawyer Salvador S. Panelo said by telephone.

He added that the palace had been aware of the controversies surrounding the Russian vaccine, and the local Food and Drug Administration (FDA) would still have the final say on its safety.

“We are aware of this news but whatever happens, it has to undergo FDA examination,” Mr. Panelo said. “We have our own protocols.”

The 75-year-old Mr. Duterte last week thanked Russia for supposedly offering to send the vaccines to the Philippines for free. He claimed the Russian vaccines could arrive by September or October.

The palace later said the Philippines would have to wait until next year for the vaccine to become commercially available.

The Department of Health (DoH) has allotted P2.4 billion for COVID-19 vaccines in its budget for 2021 and this could change depending on the price.

China is the other country Mr. Duterte mentioned in the past that had pledged to prioritize the Philippines for coronavirus vaccine supplies once they develop one.

Mr. Duterte has been criticized for failing to detail a national strategy to combat the pandemic and help the economy get out of a recession in his yearly address to Congress in July.

The country entered into a recession last quarter after economic output shrank by 16.5%.

Ms. Valdueza, mentioned at the outset, said she’s not too hopeful about the Russian coronavirus vaccine.

“I’m not very optimistic about the vaccine, to be honest,” she said. “I hope it succeeds, but I’m very wary about recent developments. I’ll probably pass on getting a shot, unless we’re required or if half of the world is doing it.”

Remittances from sea-based OFWs seen to remain weak

More than 135,000 overseas Filipino workers have been repatriated as of mid-August, the Foreign Affairs department said. — PHILIPPINE STAR/EDD GUMBAN

BANGKO SENTRAL ng Pilipinas Governor Benjamin E. Diokno on Tuesday said inflows from sea-based overseas Filipino workers (OFWs) may remain weak, as the coronavirus pandemic drags on.

Cash remittances from OFWs coursed through banks rose by 7.7% to $2.465 billion from a year ago, driven by a recovery in inflows from land-based workers, the central bank said.

“While land-based OFWs appear to have recovered, sea-based OFWs continue to face challenges as world trade remains sluggish while cruise-ship based tourism is moribund,” Mr. Diokno told BusinessWorld in a text message.

Year to date, cash remittances slipped by 4.2% to $14.079 billion.

“In a sense, the year-to-date 4.2% slippage in OF (overseas Filipino)remittances should be seen as a positive development. It is a big departure from the grim forecast that OF remittances would plunge by 20% or higher by some analysts,” Mr. Diokno said.

The BSP projects cash remittances to drop by 5% this year.

The Asian Development Bank said remittance inflows to the Philippines could plunge by as much as 20.2% this year under a worst-case scenario when the pandemic drags on for a year.

UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said countries where remittances continued to grow are those that have effectively dealt with the coronavirus, such as Taiwan.

He noted that countries in the Middle East were also suffering from the decline in global oil prices, leading to more job losses and reduced salaries for OFWs.

Asian Institute of Management economist John Paolo R. Rivera said remittances continue to increase from countries that employ OFWs in essential sectors like healthcare, education, production, manufacturing, and the service sector.

“Repatriating more OFWs in the future will affect our remittance inflow and would be a challenge for the government to provide alternative livelihood for them especially that there is no definite time when things will go back to normal,” Mr. Rivera said in an e-mail.

Against this backdrop, the government may have to rethink its policy of exporting labor.

“This crisis is an opportunity to reform and the ultimate goal has been to keep our human capital within our borders, to provide good and quality job opportunities here,” Mr. Asuncion said.

More than 135,000 OFWs have been repatriated as of mid-August, according to the Department of Foreign Affairs. — Luz Wendy T. Noble

Not all priority workers required to undergo swab tests

Priority workers are not required to undergo regular real-time reverse transcription-polymerase chain reaction (RT-PCR) tests, according to a circular issued by the Trade and Labor departments. — PHILIPPINE STAR/MICHAEL VARCAS

BUSINESSES are not required to regularly test all workers in government-identified priority industries for the coronavirus disease 2019 (COVID-19), according to a new advisory from the Trade and Labor departments.

In advisory No. 20-01 dated Aug. 17, the agencies clarified that priority workers may undergo a real-time reverse transcription-polymerase chain reaction (RT-PCR) test, revising an earlier circular that required testing.

Trade Secretary Ramon M. Lopez in a radio interview on Tuesday said guidelines require the use of the PCR test for workers who show symptoms of COVID-19. Asymptomatic employees need not undergo testing, he said.

“’Yung pagkasulat pala ng ‘shall,’ they are referring to ‘shall use the PCR test.’ Ibig sabihin, hindi ibang test, hindi rapid test,” he said. “Hindi mandatory ’yung i-te-test mo sila, PCR test, lalo na kung walang sintomas. Mandatory po ang test pagka-symptomatic.”

The new advisory said workers and employees in hospitality and tourism at El Nido, Boracay, Coron, Panglao, Siargao and other tourist zones identified by the Tourism department may be tested every four weeks.

Workers in manufacturing and public service providers in economic zones at “special concerns areas” may be tested every three months. Some areas are placed under “special concern lockdown” if they have a high number of COVID-19 cases.

Frontline workers and economic priority workers, or those who work in high-priority sectors that interact with the public and live in special concern areas, may also be tested every three months.

The Trade and Labor departments also said all testing facilities must use Philippine Health Insurance Corp. (PhilHealth) benefits or any benefits provided by health maintenance organizations or private health insurance to reimburse the cost of the COVID-19 test.

Employers Confederation of the Philippines (ECoP) President Sergio R. Ortiz-Luis, Jr. said in a radio interview on Tuesday private sector-led testing cannot be done because about 90% of employers run small businesses.

“Pag ni-require mo kahit nag-GCQ (general community quarantine) tayo mas maraming mawawalan ng trabaho dahil hindi masusunod ’yan,” he said, adding that half of micro-businesses have closed. Requiring tests would force more to shut down, he added.

Micro-, small-, and medium-sized enterprises accounted for 99.5% of total businesses in the country, employing 5.7 million people or more than 60% of total employment, according to 2018 government data.

Under the additional government workplace guidelines, employees experiencing COVID-19 symptoms must undergo RT-PCR testing, and employers must inform the local government units at their workplace and the worker’s residence.

Employees working on site must be screened for symptoms. The government does not require or recommend rapid testing of asymptomatic employees returning to work.

The RT-PCR test checks for the presence of the virus in people, while rapid tests check for the presence of antibodies. — Jenina P. Ibañez

BIR sets unlisted shares’ fair market value

By Beatrice M. Laforga, Reporter

THE Bureau of Internal Revenue (BIR) has revised the rules on the imposition of tax on the sale, barter or other disposition of shares of stocks that are not listed in the local bourse to clarify how the fair market value (FMV) of shares will be determined.

BIR Commissioner Caesar R. Dulay issued on Monday Revenue Regulations (RR) No. 20-2020 amending RR No. 6-2013’s provisions on taxes imposed on the disposition of shares of stocks that are not publicly listed.

The new rules state that for the common shares of stock, the book value will now be based on the latest financial statements as the prima facie fair market value of the shares.

“This is a welcome development (long overdue). Prior to the RR, in determining the FMV of the shares, there is a requirement to use the adjusted net asset (ANA) method where all assets and liabilities are adjusted to FMVs,” said Maria Lourdes P. Lim, the tax managing partner of Isla Lipana & Co., PwC Philippines, in a mobile phone message on Tuesday.

The new rules also determined the preferred shares of stock to have the liquidation value, which is equal to the redemption price of the shares as of the nearest transaction date, as the fair market value.

“In case there are both common and preferred shares, the book value per common share is computed by deducting the liquidation value of the preferred shares from the total equity of the corporation and dividing the result by the number of outstanding common shares,” the document read.

The BIR also said that the book value of the common shares or the liquidation of the preferred shares do not need to include the appraisal surplus from any property of the corporation that was not reflected in the financial statement.

“The latest audited financial statements shall be sufficient in determining the fair market value of the shares of stock,” it said.

The move is “more reasonable since it does not result in an overstatement of the FMV,” said Romeo H. Duran, president of Tax Management Association of the Philippines, Inc., in a text message.

Ms. Lim said before the RR 20-2020 was issued, the fair market value of the shares was usually higher, particularly for companies owning real properties as the “ANA method results in the upward adjustment of the value since the incremental increase in property is taken into consideration in determining the value of the shares.”

“For capital gains tax purposes, if the consideration for the sale of shares is lower than FMV, the difference is generally subject to donor’s tax unless it can be established that the transfer is made in the ordinary course of business, bona fide and [at] arm’s length,” she added.

The issuance will take effect 15 days after its publication in a newspaper.

Be strict on BPOs breaking safety rules, workers tell gov’t

By Jenina P. Ibañez, Reporter

BUSINESS process outsourcing (BPO) workers are asking the government to impose stricter penalties on companies that violate workplace health safety.

The BPO Industry Employees Network (BIEN) in a press conference on Tuesday said that government monitoring is not enough to ensure the safety of employees.

“Hindi sapat ’yung monitoring. Kapag nagkamali ’yung company, sasabihin lang nila na gawin itong tama. Walang pagbibigay ng penalties, kaya di matatakot ’yung mga company (Monitoring is not enough. A remiss company is simply told to do right. Penalties are not meted, thus companies will have no fear),” BIEN Vice-President Sarah Prestoza said.

Under government guidelines, private establishments that fail to comply will be temporarily closed until they follow the protocols. The Trade and Labor departments have not responded to questions about the implementation of temporary closures or additional penalties.

Ms. Prestoza said that the government should offer mass testing against the coronavirus disease 2019 (COVID-19) to workers, and should implement extensive contact tracing. It must also tell businesses to give workers devices for work-from-home measures, she said.

She said that outsourcing companies told BIEN that they are only following government guidelines.

“Pero kung ’yung gobyerno, mahina ang pagtulak, walang maayos na proseso kung paano ito ginagawa… ginagawa man ng kumpanya ang best nila, limitado pa rin ’yung kakayahan (But if the government is lax, and has no process to follow, even if companies do their best, their capability will remain limited).”

She said workers are often checked for their temperature, but not tested. Neither is there any contact tracing, she added.

Employees experiencing COVID-19 symptoms must undergo PCR (polymerase chain reaction) testing under government workplace safety guidelines.

Employees working on site must be screened for symptoms, but the government does not require rapid testing of asymptomatic employees returning to work.

Nadia de Leon, executive director of the Institute for Occupational Health and Safety Development, said in the press conference that the government workplace safety guidelines are “weak” and “lax” and the supplemental guidelines issued last week are not enough to stop the spread of the virus.

“Hindi nito ina-address ’yung (The guidelines do not address the) major reasons for the spread of the disease,” she said, noting that testing guidelines are vague.

“Mass testing ay naka-depende pa rin sa mga (still depend on) employers. Walang (There is no) clear provision that the government will shoulder the expense for mass testing for workers.”

Contact tracing, she said, is still slow and inefficient at workplaces.

E-payment firm Paynamics eyes wider SME market share

PAYNAMICS TECHNOLOGIES, INC. aims to add a third of small and medium-sized enterprises (SMEs) into its client base as businesses transition to a more digitized environment brought about by the pandemic.

“With Paynamics Biz, we are targeting to register over 100,000 merchants over the next three years,” Paynamics Chairman and Founder Ronald Gerald P. Magleo said in an online briefing on Tuesday, noting that the target is equivalent to a third of the over 300,000 SMEs in the country.

The firm will be banking on consumers’ shifting mindset as they are getting more comfortable with digital transactions because of the restrictions caused by the coronavirus disease 2019.

“For example, online school learning, food ordering, or online retails or paying for online bills and remittances — they’re now doing it online because of the fear of going out to transact or carry out their errands,” said Paynamics Chief Executive Officer and Co-founder Mylene C. Magleo.

The firm’s platform called Paynamics Biz allows payment transactions through links and QR codes. It will soon launch an Android point-of-sale device for businesses with the facility.

Using the platform is free of charge, but businesses pay a 2.5% fee based on the gross amount of every successful payment transaction.

Mr. Magleo said the company is planning to enable SMEs to transition to more digital solutions. Cash ledger features may be introduced in the platform for small businesses that continue to manually track transactions via pen and paper, he said.

He said the system has security features to guard transactions.

“We prioritize investments on compliance so we always allot between 8%-12% of our revenues to business development, this is related to cloud, the security and all of that,” he said.

Ms. Magleo said that while the focus is on facilitating local payments, Paynamics is looking at processing international payments made through Visa and Mastercard “very soon.” — Luz Wendy Noble

Three local firms join Forbes Asia’s list of best small firms

THREE Philippine firms have been cited in Forbes Asia’s latest list of top-performing small and mid-sized listed companies in the Asia-Pacific region.

The annual list ranks 200 publicly listed firms out of 18,000 companies within the region with sales below a billion US dollars.

It, however, did not fully reflect the impact of the coronavirus pandemic-induced recession on those firms as it only referred to their latest full-year financial results as of July 7.

Asia United Bank Corp., pipe supplier Crown Asia Chemicals Corp., and Cebu-based power firm Vivant Corp. are among these firms, which “have track records of exceptional corporate performance.”

These firms are scored based on their record for debt, sales, and earnings-per-share growth, measured over both the most recent one and three-year fiscal periods, as well as their one-year and five-year average returns on equity.

The list excludes companies with serious governance issues, questionable accounting, environmental concerns, management issues, or legal troubles.

The geographic diversity of companies was also considered. — Adam J. Ang

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