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DoJ, UP to modernize criminal code

DOJ.GOV.PH

THE Department of Justice (DoJ) signed a memorandum of understanding (MoU) with the University of the Philippines (UP), aiming to modernize the country’s criminal code and align it with contemporary needs.

The partnership commits both institutions to collaborate on technical studies, legal research, and capacity-building initiatives to improve and streamline the nation’s penal laws.

The DoJ will provide the resources for these initiatives, while UP will contribute academic expertise, reference materials, and research outputs.

In addition, the DoJ is tasked in the partnership to share data, attribute intellectual property and recognize UP as its official partner in research and capacity-building activities.

“We are now committed specifically and formally to provide the services of the University of the Philippines that the Department of Justice needs,” UP Chancellor Edgardo Carlo L. Vistan II said in a statement on Wednesday.

“It’s about time that we put in our resources, rationalize and reconcile our work and eventually make our criminal laws understandable and accessible not only to lawyers.”

“We wish to create a new penal code that not only reflects current values and conditions but also respects rights inherent to us all as human beings,” Justice Undersecretary Raul T. Vasquez said. — Chloe Mari A. Hufana

Landers opens first Mindanao store

DAVAO CITY — Landers Superstore officially opened its Davao City store along F. Torres Street on Wednesday.

Landers Superstore Davao is the membership supermarket’s 14th store in the country and first in Mindanao.

Landers Superstore Chief Transformation Officer Bill Cummings said in an interview that what makes them excited to open in Davao City is the growth prospects that they see in the city.

Mr. Cummings said a Landers store usually carries from 5,000 to 7,000 products and in Landers Superstore Davao, apart from carrying imported products and items, it also locally sourcing products such as durian and pomelo fresh fruits.

Mr. Cummings said their suppliers/partners helped them curate a unique assortment that goes through a very rigorous outline for them to determine which product makes it and which doesn’t.

“The buyers work for our suppliers/partners to make sure that we optimize the assortment not only for the Philippines but sometimes even for our local communities. We are not only supporting a local community with sourcing products, we are also providing our customers and members with outstanding member value, and we combined that,” Mr. Cummings said.

Mr. Cummings also boasted about their “treasure hunt” items.

“These are items that you cannot find everywhere in a normal grocery store. The giant dog and Lego luggage are all items that moms did not necessarily have on their shopping list but when she comes in, ‘huh, that is super cool right?’ And I want to add that to your overall shopping experience in Landers. Overall values combined with a treasure hunt,” he said.

As of December 3, 2024, member card applications already reached more than 70,000 and according to Mr. Cummings, this is the first in the entire history of Landers.

“It’s our 14th location but the number of members that we have already signed up is the number one we ever have in our entire history. We are extremely excited about now and in the future for this particular market,” he said.

Mr. Cummings also prided Landers’ spacious aisles.

“You are not cramped, we have large shopping baskets and when you come in, it’s a relaxing shopping experience. We demonstrate not only our wonderful products but sometimes you will also see we give product samplings, so we need a little room for people to line up so that they get a chance to experience it,” he said.

Mr. Cummings said they will see their prospects after the opening day.

“Probably after a year. We have an awesome team of real estate managers, and their job is to identify proper locations for future expansions,” he said. — Maya M. Padillo

Peso extends climb before inflation report

IRFAN HAKIMUNSPLASH

THE PESO extended its climb against the dollar on Wednesday to hit a near five-week high before the release of Philippine November inflation data.

The local unit closed at P58.23 per dollar on Wednesday, strengthening by 35 centavos from its P58.58 finish on Tuesday, Bankers Association of the Philippines data showed.

This was the peso’s best finish in almost five weeks or since its P58.10-a-dollar close on Oct. 31.

The peso opened Wednesday’s session stronger at P58.485 against the dollar. Its intraday best was its closing level of P58.23, while its worst showing was at P58.50 versus the greenback.

Dollars exchanged rose to $1.72 billion on Wednesday from $1.32 billion on Tuesday.

The peso rose on expectations of faster November inflation, which could affect the Philippine central bank’s policy decision this month, a trader said by phone on Wednesday.

Headline inflation may have picked up in November as prices of key food items rose due to the impact of several typhoons, analysts said.

A BusinessWorld poll of 15 analysts conducted last week yielded a median estimate of 2.5% for the November consumer price index (CPI), within the central bank’s 2.2% to 3% forecast for the month.

If realized, the November print would be slightly faster than the 2.3% clip in October but slower than 4.1% in the same month a year ago.

This would also mark the 12th straight month that headline inflation was within the Bangko Sentral ng Pilipinas’ (BSP) 2-4% annual target.

The BSP expects inflation to average 3.1% this year. In the first 10 months, headline inflation averaged 3.3%.

The Philippine Statistics Authority will release November CPI data on Dec. 5. (Thursday).

The peso was also supported by the seasonal increase in remittances ahead of the holidays, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

For Thursday, the trader sees the peso moving between P58.20 and P58.50 per dollar, while Mr. Ricafort expects the peso to range from P58.10 to P58.30. — A.M.C. Sy

PHL stocks drop further before inflation report

BW FILE PHOTO

THE MAIN INDEX declined for a second straight session on Wednesday on expectations of faster November inflation due to the impact of recent typhoons on commodity prices and amid the political turmoil in South Korea.

The Philippine Stock Exchange index (PSEi) inched down by 0.06% or 4.25 points to end at 6,729.96 on Wednesday, while the broader all shares index rose by 0.01% or 0.71 points to 3,792.48.

“Philippine shares traded flat once again as investors await [Thursday’s] consumer price index (CPI) release. Several are estimating that the latest inflationary data will be slightly above October’s 2.3% but well within the administration’s acceptable range,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

A BusinessWorld poll of 15 analysts done last week yielded a median estimate of 2.5% for the November CPI, within the central bank’s 2.2% to 3% forecast for the month.

“The local market’s sideways movement this Wednesday ended in the negative territory. The negative sentiment within the region caused by the political turmoil in South Korea weighed on the local bourse,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

“Investors also digested the Philippines’ latest national government debt data, which reached a new record,” he added.

National Government outstanding debt went up by 0.8% or by P126.95 billion to a fresh high P16.02 trillion as of end-October from P15.89 trillion as of end-September due to the peso’s depreciation.

Meanwhile, Asian equities stumbled on Wednesday as traders contended with the political storm in South Korea, where martial law was imposed and subsequently lifted hours later, while a no-confidence vote in France put the euro in the spotlight, Reuters reported.

South Korean President Yoon Suk Yeol said on Wednesday he would lift a surprise martial law declaration he had imposed just hours before, backing down in a standoff with parliament which roundly rejected his attempt to ban political activity.

Majority of sectoral indices closed higher. Financials rose by 0.34% or 7.86 points to 2,262.60; services went up by 0.34% or 7.16 points to 2,113.02; property climbed by 0.3% or 7.65 points to 2,524.24; and industrials increased by 0.15% or 14.31 points to 9,235.30.

Meanwhile, holding firms dropped by 0.8% or 46.07 points to 5,708.23 and mining and oil went down by 0.09% or 7.36 points to 7,481.51.

Value turnover increased to P7.96 billion on Wednesday with 507.68 million issues traded from the P5.77 billion with 492.73 million shares exchanged on Tuesday.

Advancers bested decliners, 103 versus 89, while 42 names were unchanged.

Net foreign selling rose to P537.32 million on Wednesday from P389.94 million on Tuesday. — RMDO with Reuters

Palawan Travel and Trade Expo kicks off in 2025

EL NIDO, PALAWAN — EIBNER SALIBA-UNSPLASH

PALAWAN, dubbed “one of the best islands in the world” by various travel publications, is making a bid to claim the top spot with the launch of the Palawan: World’s Best Island Travel and Trade Expo 2025.

The Palawan dedicated travel expo is set to take place from February 5 to 7, 2025, at the Glorietta Mall Activity Center in Makati City.

It will showcase travel packages, eco-tourism initiatives, and cultural highlights from over 80 exhibitors. Designed to attract domestic tourists, the expo aims to promote Palawan’s unique offerings and elevate its status as a premier travel destination.   

“Whatever you want outside of the Philippines is already here in Palawan. There’s so much diversity of activities here in Palawan,” Rey Felix C. Rafols, president of the Palawan Tourism Council (PTC) said in mixed English and Filipino at a news briefing on Tuesday.

The Palawan expo will feature exclusive travel deals at its booths, Mr. Rafols said, offering unique discounts on flights, accommodations, tours, and adventure packages — opportunities that can’t be found elsewhere.

Mr. Rafols also said that the expo is dedicated to Palawan-based business owners, particularly the “small players,” providing them with a platform to showcase their products. This event will serve as a trade show and an industry networking opportunity, allowing local entrepreneurs to connect and gain visibility.

“For next year, we will be the stars — you will be the stars. We are going to present the best of the best of Palawan. We are going to showcase the heart, beauty, and history of Palawan,” Mr. Rafols further said.

The expo will also highlight Palawan’s United Nations Educational, Scientific, and Cultural Organization (UNESCO) World Heritage Sites, including Tubbataha Reefs and the Puerto Princesa Underground River, along with lesser-known destinations that also deserve UNESCO recognition, such as the Tabon Caves.

Palawan is also expanding its offerings to include Sports Tourism, MICE (Meetings, Incentives, Conferences, and Exhibitions), and cruise tourism, while remaining committed to sustainable practices. PTC emphasized that these initiatives will also be featured at the upcoming expo.

An estimated one million visitors are expected over the course of the three-day event, which aims to boost the relatively low 17% share of domestic tourism in Palawan, Mr. Rafols said. — Edg Adrian A. Eva

South Cotabato students get responsible mining lessons

COTABATO CITY — An inter-agency, multi-sector bloc launched a continuing information campaign in schools in South Cotabato province on safe utilization of mineral and fossil fuel deposits in Region 12.

Radio stations in Central Mindanao reported on Wednesday morning that officials of the Mines Geosciences Bureau (MGB) 12 and the Department of Environment and Natural Resources (DENR) 12 embarked on the project to generate awareness among students on the need for cross-section cooperation in preventing any illegal mining operation in the region.

They were joined by experts from the Soccsksargen Responsible Miners Association, the Sagittarius Mines Incorporated and Blaan tribal leaders.

The project is also meant to educate the students on the intricacies and benefits to the local communities of legitimate, responsible and environment-friendly mining operations under the joint watch of the MGB, the DENR, and cause-oriented groups.

The government agencies and private entities together pushing the project forward facilitated a series of dialogues last week with students at the campuses of the Tampakan National High School, the Tablu National High School and the Liberty National High School, all in Tampakan town in South Cotabato. — John Felix M. Unson

Tobacco farmers to get P100-M crop production aid

PHILSTAR FILE PHOTO

BAGUIO CITY — Tobacco industry regulator National Tobacco Administration (NTA) is readying the handover of a P100-million crop production aid for qualified tobacco farmers nationwide for cropping year (CY) 2024 – 2025.

At least 16,666 tobacco farmers were identified as recipients of the cash assistance of P6,000 each for each tobacco farmer to be handed over to them on or before December 15, 2024.

A recent conference, presided over by Agriculture Undersecretary Deogracias Victor B. Savellano with NTA Administrator Belinda S. Sanchez, decided based on guidelines set and approved by the NTA Governing Board.

“The giving of production assistance for our tobacco farmers is realized under the administration of President Ferdinand R. Marcos, Jr. through Agriculture Secretary Francisco P. Tiu Laurel, Jr. and the NTA to enhance the production of quality tobacco considering that the tobacco industry remains one of the strongest pillars of the country’s economy contributing 1% of the gross domestic product (GDP) and 6% of the overall annual tax revenue collections,” Mr. Savellano pointed out.

Of the 16,666 tobacco farmers crop production assistance beneficiaries, 9,055 are farmers logged under the NTA’s Tobacco Contract Growing System (TCGS) program, and 7,611 are non-TCGS farmers. — Artemio A. Dumlao 

EU sees more PHL projects as FTA talks loom

REUTERS

By Justine Irish D. Tabile, Reporter

THE European Union (EU) might pursue more projects in the Philippines amid negotiations for a bilateral free trade agreement (FTA), according to an official with the EU Delegation to the Philippines.

On the sidelines of the EU-Philippines Business Conference on Wednesday, Minister Counsellor and Head of the Economic Trade Section Philipp Dupuis said the EU side expects more forms of trade-related cooperation to come up.

“In any case, there will be other forms of cooperation that are to the benefit of Filipino trade. All the more that we are now going into the FTA process,” Mr. Dupuis told reporters.

“We will see whether, around this, something may come up. But all this is not yet decided. These are the things that have to be further reflected upon in Brussels,” he added.

In March 2021, the EU launched the ARISE (ASEAN Regional Integration Support by the EU) Plus Philippines, which is a €5.8-million trade-related technical assistance project. It will run until Feb. 28, 2025.

“We see that the ARISE Plus has been a very successful project. But we will probably do more on a regional basis now,” he said.

“I think this is where I see this going. So, regional basis means ASEAN-wide,” he added.

According to Trade Undersecretary Allan B. Gepty, the EU has been one of the Philippines’ providers of technical assistance and capacity building in areas such as sustainable development, trade-related issues, and micro, small and medium enterprises.

“The EU has been one of the largest sources of foreign investment for the Philippines, with total net foreign direct investment amounting to $64 million and approved investments amounting to $13.4 billion in 2023,” he said.

“Notwithstanding, there is still much potential to be explored not only in market access for goods but also for services and investments, and other areas like innovation, digital trade, and energy,” he added.

Under the ARISE Plus project, the Philippines has been the recipient of programs and activities, Mr. Gepty said.

“The EU’s commitment to this project underscores the strong and enduring relationship between our regions,” he said.

“The ARISE Plus project is one of the important elements of our efforts to foster inclusive economic growth and enhance the international trade performance and competitiveness of the Philippines,” he added.

Mr. Dupuis said that the two parties made good progress in the first round of negotiations for the FTA in October. Talks for an EU-Philippines FTA had been on hold since 2017.

“In our eyes, from the EU side, we think it was a very good round, an excellent round. We made good progress on this. We have a good dynamic in this negotiation,” he said.

“We now look forward to the second round in February, which will take place here in Manila. I think that’s all we can say. It’s in the very early stages of the negotiations, but so far it has been a very good discussion with the Philippines,” he added.

According to Mr. Gepty, President Ferdinand R. Marcos, Jr. has said that the ultimate aim is to wrap up the negotiations for the EU-Philippines FTA by 2027.

Philippine negotiators set a target of concluding talks as early as 2026 to ensure no gap in trade privileges once the Philippines graduates to upper middle-income status.

The Philippines participates in the EU’s Generalized Scheme of Preferences Plus (GSP+), which is a special incentive arrangement for low and lower middle-income countries. It grants zero duties on 6,274 Philippine-made products.

“We are very much aware of course that from the time on when the Philippines graduates into an upper middle-income country, there’s another three years of transition time, and then the GSP Plus benefits go away,” he said.

“At the end of the day, we all wish to do this as quickly as possible, but it needs to be good. We cannot, in our eyes, sacrifice quality for speed. Because an FTA is to last, and it should be good,” he added.

The two parties are set to hold the second round of the negotiations on Feb. 11-13, in which they will discuss around 20 chapters, according to Mr. Dupuis.

He said a quality FTA is one that “gives real new market access to both sides, stable rules, and also has sustainability at its core.”

EU hoping to ‘match’ PHL ambitions for FTA by 2027

REUTERS

A EUROPEAN UNION (EU) official called the Philippine timetable for concluding a free trade agreement (FTA) “ambitious” but added the EU side is hoping as well for talks to make progress according to the Philippine schedule.

Niclas Kvarnström, managing director for the Asia and the Pacific at the EU External Action Service (EEAS) said at a briefing in Makati City on Wednesday: “That’s great to hear that from the Philippine side, there’s an ambitious timetable,” referring to the schedule set by President Ferdinand R. Marcos, Jr.

“We would also like to match that by being ambitious on our side… so we hope very much that timetable is realistic.”

The EU expects bilateral trade to increase with the FTA, Mr. Kvarnström said, cited the aftermath of such deals with Vietnam and Singapore.

“I would say the potential for both economies, and I think that it’s also true to say that we’re quite complementary in terms of economic exchanges and will significantly contribute to market access for both sides… and for the Philippines to move up the value chain,” he said.

Trade Undersecretary Allan B. Gepty has said the government’s internal target is to conclude trade negotiations by 2026, but the Marcos administration’s ultimate aim is to wrap up by 2027.

Mr. Gepty said the 2026 target is intended to ensure no gap in trade privileges should the Philippines lose EU concessions by graduating to upper middle-income status.

The Philippines participates in the EU’s GSP+, a special incentive arrangement for low and lower middle-income countries. It grants the country zero duties on 6,274 made products.

The agreement, which requires the Philippines to uphold commitments to 27 international conventions on human rights, labor, good governance and climate action, was extended until 2027 before it expired at the end of last year.

The EU is expected to negotiate for maximum access for almost all of its products, particularly meat, other agricultural products, electronics, and automotive products, while the Philippines will also be pushing for the maximum access for its agricultural exports, according to Mr. Gepty.

Mr. Kvarnström said he met with officials from the Finance department and other agencies on Nov. 25 to tackle potential areas of cooperation such as critical raw materials and green financing.

“Possible new investments in the green economy were mentioned as a priority area for prospective loan financing with EU grants, blended finance, and guarantees,” according to the Philippines and EU joint statement published by the EEAS.

In his visit to Manila in June, Hungarian Minister of Foreign Affairs Péter Szijjártó said his country, which assumed EU chairmanship in July, seeks to speed up negotiations for the FTA before the country’s GSP+ perks expire in 2027.

“Trade agreements are always tricky to negotiate between partners, but it does help to have political will on both sides, which I think there is (between both countries),” Mr. Kvarnström said.

“We hope that the direction here is that in a world where it’s a tougher space for free trade than it was before with higher geopolitical tensions, ASEAN (Association of Southeast Asian Nations) and European countries can find each other to be partners in a deeper way than before.” — John Victor D. Ordoñez

P40 rice pushed out to more Metro Manila markets

PHILIPPINE STAR/EDD GUMBAN

THE Department of Agriculture (DA) said it will distribute subsidized P40 rice to more Metro Manila markets starting Thursday, Dec. 5.

“There will be rice kiosks in selected markets in the (National Capital Region) including two train stations,” Assistant Secretary for Consumer and Legislative Affairs Genevieve E. Velicaria-Guevarra said at a briefing on Wednesday.

She added that the initial markets include Kamuning Market, Malabon Central Market, New Las Piñas City Public Market, Pasay City Public Market, and Guadalupe Public Market.

Kiosks will also be set up in the North Avenue and Monumento stations of the Metro Rail Transit and Light Rail Transit lines.

“These kiosks will offer Rice-for-All at an affordable price of P40 per kilo, available from Tuesdays to Saturdays, 8 to 5 p.m.,” Ms. Velicaria-Guevarra said.

She said that the kiosks will be affiliated with the KADIWA ng Pangulo program and supplied by the Food Terminal, Inc.

She said that the DA is also looking to put up rice kiosks at Balintawak Market, Cartimar Market, Pateros Grace Marketplace, Maypajo Public Market, and Paco Market.

“Rice for All” was first launched to sell cheap well-milled rice at KADIWA centers.

The government currently sells P29 rice to low-income individuals.

The DA is looking to expand its KADIWA network to 1,500 locations by 2028, it is expecting to open 179 KADIWA Centers by the end of the year.

Ms. Velicaria-Guevarra said that KADIWA centers will also sell well-milled rice at P40 per kilo starting Dec. 5.

According to DA price monitors, a kilogram of well-milled rice in Metro Manila markets sold for between P42 and P52 as of Dec. 3. — Adrian H. Halili

Semiconductor industry hoping EU pursues its own CHIPS Act

A worker operates the die attach machine at a semiconductor manufacturing plant in Manila, Dec. 10, 2008. — REUTERS

THE Semiconductor and Electronics Industries in the Philippines Foundation, Inc. (SEIPI) said it is hoping the European Union (EU) legislates its own version of the US CHIPS and Science Act. 

At a panel discussion at the EU-Philippines Business Conference on Wednesday, SEIPI President Danilo C. Lachica said he hopes the EU makes similar moves to further diversify its semiconductor supply chain.

“The US CHIPS Act carves out about $52.9 billion to onshore semiconductor wafer fab manufacturing back to the US,” Mr. Lachica said.

“The EU (may) want to bring in the capacity… so it will be less dependent on Taiwan and China for semiconductors,” he added.

In connection with such a shift, he said: “I’m hoping to see more investment poured into the Philippines for semiconductors and electronics,” he said.

“We have a growing integrated circuit (IC) design industry. We have about six companies. Unfortunately, none of them are from the EU, and I hope to see investment from there,” he added.

He said the biggest EU semiconductor company operating in the Philippines is STMicroelectronics, adding that he hopes the EU will consider IC design, wafer fab, and assembly, test, and packaging operations in the Philippines.

In 2023, the semiconductor industry exported $45.6 billion, or 62% of all Philippine commodity exports, according to Mr. Lachica.

“Of the top five export destinations of the Philippines, four are in Asia, and one in the US. Hong Kong is the top export destination, close to 30%. The US is number two, and there’s been a turnaround, with China now number three,” he said.

“But for the EU, the top two destinations are essentially Germany at about 4.9%, and the Netherlands at about 2.5%. So, between the two of them, close to about $4 billion, which is, like I said, we’d like to see grow,” he added.

He said that the Philippine semiconductor and electronics industry lost ground during the previous administrations as capital fled in response to incentive rationalization.

“But the good news is that our new administration is fixing those with the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act and other incentives,” he said.

“So, we are very optimistic about announcing that the Philippines is back. It’s a strong, open industry, both for investors as well as exporting to the EU,” he added. — Justine Irish D. Tabile

Compliant power cooperatives to be granted exemption from local taxes

PHILSTAR

ELECTRIC COOPERATIVES (ECs) found compliant with the financial and operational standards set by the National Electrification Administration (NEA) will be exempt from tax, fees, and charges imposed by local government units (LGUs), according to the Department of Energy (DoE).

The Energy and Finance departments signed a joint memorandum circular on Wednesday which set the guidelines for ECs availing of the preferential tax treatment.

The arrangement is governed by the Republic Act (RA) No. 7160 or the Local Government Code of 1991 and RA No. 10531 or the National Electrification Administration (NEA) Reform Act of 2013.

“This local tax exemption is a significant milestone for our qualified ECs, as it directly translates to reduced financial burdens that can be reinvested into improving services and achieving 100% total electrification,” Energy Secretary Raphael P.M. Lotilla said in a statement.

“By reducing these costs, we empower them to focus on expanding access to electricity, especially in unserved and underserved areas, ensuring no Filipino household is left behind,” he added.

Local taxes are collected by provinces, cities, municipalities, and barangays. They include real property tax, business tax, franchise tax, and tax on transfer of real property ownership.

The circular requires ECs to obtain an annual certificate of compliance from the NEA, demonstrating their adherence to the regulator’s prescribed financial and operational standards.

To qualify for the certification, the cooperatives must achieve at least a 75% rating based on NEA’s compliance parameters.

These parameters include maintaining high collection efficiency, achieving positive net worth, meeting system reliability and system loss standards, conducting annual general membership assemblies and district elections as scheduled, implementing electrification projects to attain 100% customer connection, and submitting complete and timely reporting requirements to the NEA.

However, all ECs remain subject to regulated and reasonable administrative costs imposed by LGUs, in accordance with the Joint Memorandum Circular No. 2019-01 signed by the Department of the Interior and Local Government (DILG) and the Department of Finance (DoF).

“This circular established the guidelines for reasonable rates of regulatory fees and services charges levied by LGUs. These costs include fees for business permits, mayor’s permits, barangay clearances, community tax certificates, and other charges such as those for water consumption, electricity, and toll fees,” the DoE said.

The NEA will issue the guidelines governing the issuance of certificates of compliance within 15 days from the effectivity of the joint circular, according to the DoE.

In a separate statement, the NEA said that the circular “addresses crucial gaps in the finances of ECs, enabling them to access certain tax privileges and incentives, which would redound eventually to the benefit of their respective organizations and member-consumer-owners.”

NEA Administrator Antonio Mariano Almeda said that the measure “proves the government’s commitment to fostering equitable financial support to all ECs, without distinction, while ensuring their compliance with operational standards.”

The Philippine Rural Electric Cooperatives Association, Inc. (PHILRECA) welcomed the signing of the circular between the DoE and DoF.

“We at PHILRECA welcome today’s signing of the joint memorandum circular, which aims to provide guidance to local government units on the availment of preferential rights of electric cooperatives,” PHILRECA Executive Director and General Manager Janeene Depay-Colingan said in a statement.

According to the circular, the Bureau of Local Government  Finance (BLGF) will be responsible for the dissemination of the circular to all LGUs through the local treasures for implementation and monitoring the compliance of LGUs, the association said.

The BLGF will also provide technical assistance to LGUs.

Asked to comment, Jonathan L. Ravelas, senior adviser at professional service firm Reyes Tacandong & Co., said that the tax exemption could have implications for local government revenue.

“Local governments may experience a reduction in revenue due to the loss of taxes and fees previously collected from these cooperatives,” Mr. Ravelas said via Viber.

“The significance of this foregone revenue will depend on the number of cooperatives in each locality and their respective contributions to the tax base,” he added.

The NEA supervises 121 ECs.

The policy could encourage more ECs to comply with financial and operational standards, potentially leading to more efficient and reliable electricity services, Mr. Ravelas said.

“Improved energy infrastructure can stimulate local economic activity, which might offset some of the lost revenue through increased business operations and employment,” he said.

“In the long run, the overall economic growth spurred by better electricity services could enhance the local tax base, potentially leading to higher revenues from other sources,” he added.

Terry L. Ridon, a public investment analyst and convener of think tank InfraWatch PH, said that while the development is a “welcome national pronouncement,” ECs will still have to “discuss and assert” the exemption with the local governments governing their facilities.

“National agencies such as the DILG should assist ECs to ensure a smooth implementation of this order, as some LGUs which derive significant revenue from these taxes might raise legal objections on the basis of local autonomy,” he said via Viber. — Sheldeen Joy Talavera

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