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Gov’t to fast-track business permits as COVID-19 cases rise

THE PHILIPPINE Senate on Wednesday approved on third and final reading a bill giving President Rodrigo R. Duterte special powers to quicken permit and license approvals amid a coronavirus pandemic that has sickened almost 350,000 people.

Senate Bill 1844, which will empower the President to fast-track processes for new and pending applications for permits, licenses and certifications during times of national emergencies.

Mr. Duterte on Wednesday certified the bill as urgent, allowing the chamber to do away with the three-day requirement before a bill passed on second reading could be approved on final reading.

The measure is expected to “facilitate economic activity, accelerate the socioeconomic recovery of the country and ensure the prompt delivery of public services in times of national emergency,” Mr. Duterte said in his letter to Senate President Vicente C. Sotto III.

The Department of Health (DoH) reported 1,910 coronavirus infections on Wednesday, bringing the total to 346,536.

The death toll climbed by 78 to 6,499, while recoveries increased by 579 to 293,860.

There were 46,227 active cases, 84.5% of which were mild, 10.5% did not show symptoms, 1.6% were severe and 3.3% were critical.

Metro Manila reported the highest number of new cases with 624, followed by Cavite with 219, Batangas with 104, Rizal with 91 and Negros Occidental with 63.

Of the new reported deaths, 35 came from Metro Manila, 12 from the Calabarzon region, seven from Central Luzon, six from Northern Mindanao, five from Western Visayas and three each from the Ilocos and Davao regions.

The Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) reported two deaths while the Bicol region, Central Visayas, Eastern Visayas, Zamboanga Peninsula and Soccsksargen reported one each.

More than 3.9 million people have been tested for the disease, the agency said.

Mr. Duterte placed the country under a state of calamity in March until last month as the government tried to contain infections. He extended this for a year until September 2021.

The Senate bill will also allow the President to suspend or waive requirements in securing documents at the national and local levels.

The coronavirus has sickened 38.4 million and killed 1.1 million people worldwide, according to the Worldometers website, citing various sources including data from the World Health Organization (WHO). Almost 29,000 people have recovered from the virus, it said.

It added that active cases stood at 8.4 million, 1% of which or 70,036 were either serious or critical, according to the website.

The United States had the most infections at 8.1 million, followed by India with 7.2 million and Brazil with 5.1 million. The US also had the most deaths at 220,873, Brazil had 151,063 and India had 110,645. — Charmaine A. Tadalan and Vann Marlo M. Villegas

Change in DPWH budget for national roads questioned

THE SENATE finance committee on Wednesday questioned changes in the 2021 budget of the Department of Public Works and Highways (DPWH) after its P131-billion budget for national road development was cut.

Senator Panfilo M. Lacson, vice chairman of the committee, noted that P21.456 billion of the fund had been transferred to local projects.

“I’d like to find out why there’s a big variance of P21.456 billion lost from network development,” he told Public Works Secretary Mark A. Villar during an online hearing.

“This will have a major effect on national development, which I believe should be the focus of Reset, Rebound, Recover,” he said in mixed English and Filipino.

Under the national expenditure program, P131 billion was allocated for network development, which was cut to P109 billion in DPWH’s August 14 submission after it made changes to its budget items.

Mr. Villar said his office had to submit a detailed annex of its proposed budget at a later date under a compromise with the Budget department due to a tight deadline during the budget processing.

“The ceiling was given at a date very close to the actual printing, which rendered us unable to give details in such a short time,” he told senators.

DPWH’s budget for the construction of roads near tourism destinations was also cut by P8.4 billion, while the budget for local programs was increased by P52 billion.

This raised the budget for local programs to P229 billion from P176 billion, P67 billion of which will fund the building of multi-purpose buildings and facilities. Mr. Villar said his office had received requests from various sectors for these buildings.

He said national programs would still be prioritized. “We also want to do pump-priming in the countryside, in communities that are hard to reach.”

At the same hearing, senators asked the agency to prioritize Filipinos over foreigners in hiring. Senator Francis N. Pangilinan asked Mr. Villar whether the government’s loan agreements with China under its national infrastructure program has a clause that will give preference to Filipino workers.

“The construction industry has registered the largest drop in unemployment in the second quarter of this year,” he said. “That’s almost a 30% drop in employment. So, it is really imperative for the government to be able to create jobs and also protect existing jobs,” he added.

Public Works Undersecretary Emil K. Sadain said some Chinese workers had been hired because the projects required technical jobs. He said Filipinos would be prioritized in future agreements.

“In future projects, we’ll put some consideration to give more high emphasis on the engagement of Filipino workers over the Chinese workers,” he added. — Charmaine A. Tadalan

Congressmen want to double Robredo’s budget for next year

CONGRESSMEN on Wednesday sought to double the Office of the Vice President’s P679-million budget after it was given the lowest allocation in next year’s P4.5-trillion appropriations.

Doubling the budget would let the office reach more Filipinos for its coronavirus pandemic recovery programs, Baguio City Rep. Mark Go told a budget plenary hearing at the House of Representatives.

“It will be a disservice to the country if we do not increase the budget of the Office of the Vice President (OVP),” he said. He wanted the higher allocation reflected in the amended budget bill.

Cagayan De Oro Rep. Rufus B. Rodriguez, Marikina Rep. Stella Luz A. Quimbo and Party-list Rep. Sarah Jane I. Elago also supported the budget increase.

Vice President Maria Leonor G. Robredo, who attended the budget hearing, had sought a P720-million budget but was given only P679 million by the Budget department. This was 66% lower that her office’s budget this year.

“We are happy that the proposed budget of the OVP underwent smooth plenary deliberation,”  her spokesman Barry Gutierrez said in a statement on Wednesday.

Presidents and vice presidents in the Philippines are elected separately and can come from different political parties. Ms. Robredo belongs to the party of Benigno S.C. Aquino III, President Rodrigo R. Duterte’s predecessor.

Party-list Rep. Ferdinand Gaite said Ms. Robredo’s program to provide livelihood to families affected by the pandemic needs more funds. “We support the budget increase of the OVP to improve its services that genuinely serve the people.”

Ms. Robredo has sought the help of the private sector and civil society in helping more families during the health crisis.

Aside from helping people affected by the pandemic, her office has also tapped families of victims of Mr. Duterte’s deadly war on drugs to help produce personal protective equipment against the virus.

The House plenary deliberation on the OVP budget took only half an hour. — KATA

Regional Updates (10/14/20)

Tagaytay bypass road to partially open this month

A 1.54-KILOMETER section of the 8.59-km Tagaytay bypass road will be open to motorists before the end of the month, the Department of Public Works and Highways (DPWH) announced Wednesday. The initial segment that will be ready covers the Maitim and Kaybagal areas. “The opening of these two (2) sections this October is only the beginning as we have been prioritizing the inclusion of Tagaytay Bypass Road Project in the national budget since 2018,” DPWH Secretary Mark A. Villar said in a press statement. The bypass road is intended to divert traffic from the congested parts of the popular highland city. It is seen to reduce travel time from Alfonso town in Cavite to Tagaytay City to 20 minutes from the current 53 minutes. DPWH has so far released P466.24 million for the ongoing and completed sections of the bypass road, and will require another P1.08 billion to complete the project.

Makati council approves budget for base salary hike of nurses

THE MAKATI City council has approved the P55.17 million additional budget that will cover a hike in the base salary of nurses hired by the local government. Mayor Abigail Binay-Campos said entry-level nurses will receive a basic monthly pay of P32,053 from P22,316 effective July 1, 2020. “The salary increase is a welcome development for our nurses, and is a fitting recognition of their hard work and sacrifice that have been magnified by this crisis. The substantial salary differential they will receive will also bring immense financial relief, especially to struggling breadwinners of the family who can hardly make both ends meet,” the mayor said in a statement on Wednesday. “We hope that with a more competitive salary, board-certified nurses who have opted to pursue a non-related career or go abroad will be inspired to stay and serve their fellow Filipinos,” she added. The city government has hired 56 new nurses since the coronavirus pandemic broke out in March, along with other medical and social workers for the Ospital ng Makati. The nurse pay hike in the city comes ahead of the implementation of the new Salary Standardization Law or Republic Act 11466, wherein the base salary schedule of nurses in government service in the next three years will be as follows:  January 1, 2021, P33,575; January 1, 2022, P35,097; and January 1, 2023, P36,619.

Typhoon Ofel makes 3 landfalls, maintains strength until Thursday

TROPICAL DEPRESSION Ofel, the 15th typhoon to pass through the Philippines this year, made three landfalls on Oct. 14 and brought rains over central parts of the country. Its three landfalls were in Can-avid, Eastern Samar; Matnog, Sorsogon; and Burias Island, Masbate. Weather bureau PAGASA forecasts Ofel to maintain its strength until Thursday but not intensify until it goes over the West Philippine Sea by Friday. It is expected to be out of the Philippine area by Saturday. As of 4 p.m. Wednesday, Ofel was located 70 kilometers (km) east-northeast of Romblon, Romblon and moving west at 15 km/hour with maximum sustained winds of 45 km/h and gustiness of up to 55 km/h. On Thursday, Ofel and the southwest monsoon will bring rains over most parts of the country. The Philippine Coast Guard reported that as of 12 noon Wednesday, there were 1,388 passengers, 682 cargoes, 41 vessels, and 19 motorbancas stranded in different ports in the regions of Calabarzon, Bicol, and Eastern Visayas.

Nationwide round-up (10/14/20)

COA flags NTC’s purchase of 44 smartphones, mostly not used for service testing project

STATE AUDITORS called out the National Telecommunications Commission (NTC) for its procurement of 44 smartphones amounting to P2.1 million, only four of which were used for the supposed research project. In its 2019 audit report, the Commission on Audit (CoA) noted that only four units were used for their intended purpose of monitoring the performance of telecommunications networks. “None of the central office personnel with issued mobile phones conducted validation and measurement of broadband speed as no mission orders were issued to them,” the report read. CoA further cited that only three out of 13 NTC engineers assigned to conduct tests in the National Capital Region got a smartphone unit, with the rest who were actually involved in the task had to “borrow units issued to the other personnel during the times they will conduct the validation.” According to the report, the NTC disclosed that it was their branch directors, officers-in-charge and technical staff who received the phones. “This condition manifests that the number of mobile phones procured may be excessive for the intended purpose and that there may not be a necessity to procure new mobile phones in Calendar Year 2019,” the report said. The high-end smartphones were procured to conduct tests “anytime and anywhere” in line with drafting policies that would improve broadband services, NTC said in its reply to state auditors. CoA, however, said the use of such smartphones — 15 units of Samsung Galaxy S9 and the 29 units of Samsung Galaxy S10 — for research on broadband services should have been documented. “We believe that there should be documentations prepared as a result of these activities to be used as inputs in the formulation of new policies or regulations,” CoA said. — Kyle Aristophere T. Atienza

PhilHealth calls on public to register, update data for UHC law  

ABOUT 94 million Filipinos, or 86.16% of the population, are registered with the Philippine Health Insurance Corp. (PhilHealth), the state-owned agency said as it announced plans to expand coverage. Under the Universal Health Care (UHC) law that took effect this year, all Filipinos are automatically covered under the insurer. PhilHealth Vice President Oscar B. Abadu, Jr. said as of September, more than 52.1 million out of 110 million Filipinos are registered as PhilHealth members while around 42.7 are enlisted as dependents. Mr. Abadu called on the public to update their registration “to have at least an accurate data so that as we move forward for the progressive realization of the UHC that we are able to provide services to the right people with the right information.” He also said PhilHealth will expand the facility participation of point-of-service updating and registration systems. It will also ask local governments, the National Commission on Indigenous Peoples, and employers for assistance in updating records. — Vann Marlo M. Villegas

De Lima seeks probe on hunger incidence rise

SENATOR LEILA M. de Lima has filed a resolution seeking to conduct an inquiry on the increasing hunger incidence in the country amid the coronavirus pandemic. Under Senate Resolution No. 534, the detained lawmaker asked the Senate to look into the impact of the lockdown on hunger in order to provide immediate relief and improve long-term policies already in place. “The Philippines has already been dealing with issues of chronic poverty and food insecurity among a significant portion of its population even before the COVID-19 (Coronavirus Disease 2019) pandemic arrived,” Ms. de Lima said in a statement. “These conditions were only further exacerbated as the virus spread among our poorest and most vulnerable sectors and were compounded by the government’s own misguided and misinformed policy decisions.” She cited a Sept. survey, conducted by the Social Weather Stations, indicating that around 7.6 million Filipino households experienced hunger during the pandemic. This is a 9.8 percentage point increase to 30.7% in September from 20.9% in July, and the highest since March 2012, when the country hit 23.8%. — Charmaine A. Tadalan   

Court reduces Nasino’s furlough period

THE MANILA regional trial court reduced the time it gave a detained activist to attend her child’s wake and funeral following a request from the jail warden that cited inadequate security manpower and health considerations. In its ruling, the court only allowed Reina Mae Nasino to visit her daughter’s wake on Oct. 14 and funeral on Oct. 16, both from 1 to 4 p.m., trimmed from the initial three-day furlough it granted. A support group for families and friends of political prisoners called Kapatid said the ruling is “gross injustice and heartless.” Ms. Nasino, charged with illegal possession of firearms and explosives, was arrested on November 5, 2019 and gave birth in detention on July 1. — Vann Marlo M. Villegas

Meralco Bolts bounce back

THE MERALCO BOLTS notched their first victory in the PBA Philippine Cup, defeating the Alaska Aces, 93-81, in the league’s opening game on Wednesday at the Angeles University Foundation gym in Pampanga.

Allein Maliksi led the way for Meralco, which with the win bounced back from its Philippine Basketball Association (PBA) “bubble” debut loss on Monday while sending Alaska to its second straight defeat.

The Bolts had steady control in the opening half, helped by better shooting than the Aces (51% versus 33%) and balanced scoring.

They held a 29-23 lead at the end of the first quarter then padded it some more to a double-digit advantage, 49-35, by the break.

Sensing they lost much ground in the opening half, Alaska came out more aggressive in the third quarter.

Forward Jeron Teng spearheaded a 17-3 run in the first eight minutes of the canto to level the score at 52-all.

The Bolts, however, were able to survive the onslaught and continued to lead, 65-58, with one quarter left to play.

Rocked in the previous quarter, Meralco began the final canto with a 12-4 blast to get itself more breathing space, 77-62, by the 8:39 mark.

The Aces tried to fight their way back after but with little success.

Meralco still commanded a 91-75 lead with three minutes remaining and held for the win from there.

Mr. Maliksi finished with 17 points for the Bolts (1-1) with guard Baser Amer adding 15 points.

Veteran Reynel Hugnatan finished with 13 points to go along with eight boards while Cliff Hodge had 11 markers.

For Alaska (0-2), it was Mr. Teng who top-scored with a game-high 25 points. He also had seven rebounds.

Vic Manuel was the only other Alaska player who scored in double digits with 18 points.

Wednesday marked the fourth day of the league in the bubble in Clark City which is aimed at completing at least one conference in its pandemic-hit season.

Under the bubble, the teams and the rest of the PBA contingent are holed up in the area for the duration of the tournament.

Meanwhile, games on Thursday will have the Phoenix Super LPG Fuel Masters (1-0) taking on the Northport Batang Pier (0-1) at 4 p.m. to be followed by the Barangay Ginebra San Miguel Kings (1-0) colliding with the Blackwater Elite (1-0) at 6:45 p.m.

In another development, those who want to experience being part of the PBA virtual fan wall may do so beginning Thursday.

The virtual wall, similar to that used in the National Basketball Association during their own tournament bubble, gives the fans a chance to cheer for their favorite teams from the comforts of their homes and see themselves on the LED screens at the AUF Gym and on television.

Links for the virtual wall will be posted on the PBA’s social media platforms with slots offered on a first-come, first-served basis. – Michael Angelo S. Murillo

DTI urges struggling firms to borrow for 13th month pay

TRADE Secretary Ramon M. Lopez said there is “no need” to defer 13th month pay this year, noting that distressed companies can borrow the needed funds to make payroll.

His remarks appear to walk back a statement attributed to him by Labor Secretary Silvestre H. Bello III, who said Tuesday that Mr. Lopez supports a deferment of 13th month pay, instead of exempting companies affected by the pandemic from disbursing 13th month pay as required by law.

Mr. Lopez, in a Viber message Wednesday, said that the matter is being reviewed by the Labor department.

“No official discussion on deferment because companies needing funds can possibly source from loans,” he said, adding that there is “no need” to delay 13th month pay.

He added that he supports either loans or subsidies for 13th month pay in small- and medium-sized businesses.

The President’s Spokesman Herminio L. Roque said Monday the Labor department could study deferment, but he believes that this cannot be done until a new law allows for it.

Employers must release 13th month pay by Dec. 24, under Presidential Decree 851. Implementing rules of the decree allow exemptions for “distressed” companies.

Senate Minority Leader Franklin M. Drilon has said deferment could set a dangerous precedent. — Jenina P. Ibañez

Overhaul seen necessary to prepare education system for post-COVID era

EDUCATIONAL institutions must reconfigure their curricula to ensure their training makes students suitable for the post-pandemic job market, education and technology experts said.

“I think the major challenge now is that what we used to teach may no longer be relevant. When the students go out, they look for jobs. What they were trained for under the old paradigms may no longer be in demand. They may no longer be able to find jobs where they were trained to do while in school a few months ago,” Pamantasan ng Lungsod ng Maynila President Emmanuel A. Leyco said at the BusinessWorld Insights online forum Wednesday.

He noted that many economies and businesses around the world are already reconfiguring themselves.

Many of the transactions in the financial community are already being performed online, and if schools and students are not adept at online technology, they will be left behind, Mr. Leyco said.

The future of schools is not to go back to the old normal, he said.

“Our future is something that will make things available, secure, and safe for us to do. We need all hands on this,” he added.

At the same forum, IBM Philippines President and Country General Manager Aileen Judan-Jiao said that collaboration among various sectors must be pursued to address the immediate needs of the education system.

She said IBM is now in talks with some local government units for a possible partnership to offer technical skills programs under P-TECH, IBM’s global education model.

“The focus of this is to really have the right skills of the future and have the exposure to the real workplace with our industry mentors,” she said.

“Let’s not start from scratch. Let’s begin with what we have and collaborate,” Ms.  Judan-Jiao added.

Tata Consultancy Services TCS iON Sales Director Shashwat Rai advised schools to take advantage of available technology solutions that make online learning possible “without the need to connect to the internet.”

Examples of technologies needed are platforms for digital assessments and interactive learning.

“We’re currently experiencing a massive shift to online learning. The technology that we set up today will matter and will help define the future of our students,” Mr. Rai said.

He added that more innovation is expected to emerge out of the rush to embrace online education.

Both the government and the private sector should work together to ensure that no students are left behind in the online mode of education, Mr. Rai said.

PLDT Enterprise First Vice-President and Enterprise Revenue Group Head Victor Tria said cybersecurity has become a major concern because of the transition to online activities, especially by schools.

“PLDT is working not just on connectivity for online learning, but also protecting that connection,” he said.

Mr. Tria also said PLDT is also partnering with various educational institutions to provide e-learning solutions.

“We recognize that we must remain agile and active. We remain committed to enabling our education sector,” he added. — Arjay L. Balinbin

Coal, hydro plants expected to mitigate Malampaya shutdown

WWW.NAPOCOR.GOV.PH

THE possible uptick in power prices next month due to maintenance on the Malampaya field can be cushioned by dispatching more power from baseload coal and hydropower plants, the independent market operator said.

In November, the Malampaya gas-to-power facility is due for maintenance, which will restrict the supply to natural gas-fired plants and possibly driving up power prices. But the Independent Electricity Market Operator of the Philippines (IEMOP) hopes increases can be tempered by other power sources.

“In that case, we hope na ‘yung malalaking (the big) baseload coal plants na naka-under maintenance ngayon ay tapos na (can complete their maintenance works in time). Otherwise, magkakaproblema talaga tayo (we will have a problem),” said IEMOP Chief Operating Officer Robinson P. Descanzo during a virtual briefing, Wednesday.

“Also, because of La Niña, dampened ang demand and marami tayong tubig, so makakatulong ang hydro, (demand is dampened and water is abundant, so the hydropower plants can help)” he added.

The Wholesale Electricity Spot Market (WESM) charges in September rose to P3.48 per kilowatt-hour (kWh) primarily due to power plant outages. But reduced demand could bring down the October average, the market operator said.

In the first few days of October, the market’s peak demand was 12,259 megawatts (MW), down 5.4% from a year earlier and 327 MW less than the previous month. The market price currently stands at P2.38/kWh with supply at 13,411 MW.

“Ang pinaka-main reason na nakikita natin ay dahil mas malamig na ‘yung panahon, then marami na ring mga pag-ulan every day (The main reason for reduced demand is the cold weather and there are rainy days),” said John Paul S. Grayda, price validation and analysis manager at IEMOP.

Power demand remains low as quarantine protocols remain in place, he added.

With La Niña ongoing apart from the quarantines, the IEMOP projects a possible power demand downturn this year.

“We see na ‘yung demand is still ‘di pa rin niya ma-breach ang level last year or mas bumaba siya, magkaroon ng downtrend, (Demand has still not breached last year’s level and could turn lower),” Mr. Grayda said.

The climate event is expected to persist until the first quarter of 2021.

The WESM operator has observed increased power consumption when quarantine protocols are eased. — Adam J. Ang

DA seeks improved rice quality to address shifting preferences

THE Department of Agriculture (DA) said it hopes to improve the quality of domestic rice due to shifting consumer preferences, and to better align farmers’ production with market expectations.

“We need to adapt to the changes brought about by the Republic Act No. 11203 or the Rice Tariffication Law, one of which is consumers’ preference for quality rice. This is now an integral part of the overall transformation of the country’s rice industry,” Agriculture Secretary William D. Dar said in a statement after consulting with farmers, millers, and traders.

Mr. Dar said traders and millers reported that many farmers produce low-quality palay which when milled produces rice that is easily broken and with a chalky consistency.

“For the succeeding cropping seasons, we are not just after attaining production targets, but also producing quality rice for Filipino consumers that will provide higher income for farmers,” Mr. Dar said.

According to rice millers and traders, consumers want rice varieties that are long-grain and tastes and smell good when cooked. The market is demanding so-called four-M rice. The four Ms stand for maganda, mura, mabango, at malambot (attractive, cheap, fragrant, and soft).

The DA said that in an informal survey, consumers who said they prefer rice with those attributes accounted for 40% of the market.

Rice millers and traders urged Mr. Dar to plant varieties that hold up to the milling process and possess good eating qualities.

They also offered assistance to the Philippine Rice Research Institute in promoting recommended rice varieties to be used by farmers in future planting seasons.

Mr. Dar said he will consult with seed producers, farmers, traders, and other stakeholders to define current industry trends, market demand, consumer needs and preferences, and any required policy shifts or reforms.

“Kung ano demand ng market, kung ano ang pangangailangan ng consuming public iyon ang dapat i-produce ng ating mga magsasaka. (Market demand and the needs of the consuming public should determine what farmers produce) We need to adapt to changes brought about by the new regime,” Mr. Dar said. — Revin Mikhael D. Ochave

Senate may call inquiry to discuss post-Malampaya plans

SENATORS said they want to look into the government’s plan for Malampaya, the Philippines’ sole natural gas field, which is expected to be depleted within the next few years, posing problems for energy security.

The upcoming sale of the operating shares of Shell Philippines Exploration B.V. (SPEx) in the Malampaya gas-to-power project prompted Senators Sherwin T. Gatchalian, Panfilo M. Lacson, and Vicente C. Sotto III to file Senate Resolution No. 533 to examine the post-Malampaya outlook for energy.

“We’re looking at the larger picture which is the energy security of the country,” Mr. Gatchalian said in a statement Wednesday.

The Malampaya field off northern Palawan accounts for 3,200 megawatts of electricity and 21.1% of gross power generated in 2019.

According to estimates by the Department of Energy, the field’s reserves will be depleted by 2027.

SPEx operates the natural gas field under Service Contract (SC) 38 alongside Udenna Group’s UC Malampaya Philippines Pte. Ltd. and state-led Philippine National Oil Co.-Exploration Corp. (PNOC-EC).

The Senators will look into SPEx’s decision to sell its 45% operating stake. Last month, the exploration firm said it is looking to sell its share in the project in part of its rationalization efforts to keep itself afloat during the pandemic.

“As part of an ongoing portfolio rationalization to simplify and increase the resilience of its business, Shell is exploring its options with a view to divest its interest in SC 38,” SPEx General Manager Rolando J. Paulino said.

Mr. Gatchalian hopes that the next Malampaya operator will have the technical capability to run the field.

“They should be able to demonstrate that they can operate this rig competently with technical expertise and in the future, if ever that area has potential, they should be able to demonstrate that so they can explore and develop that area,” he said.

The Udenna Group in a statement two weeks ago called on the PNOC-EC to acquire SPEx’s share as it believed they are the “most suitable party” for it.

Both Ramon S. Ang’s San Miguel Corp. and companies controlled by Manuel V. Pangilinan expressed interest in buying the Malampaya shares.

Meanwhile, the senators wanted to discuss the consortium’s plan to extending the gas field’s life beyond the end of its contract by 2024.

“This is not a plain and simple business transaction. It affects all of us because of energy security issues. We want to be assured that we will not run out of fuel supply in the immediate future,” Mr. Gatchalian said.

The proposed inquiry will also look into the compliance of the Malampaya consortium and the government with Presidential Decree No. 87, or the Oil Exploration and Development Act.

The Malampaya project has generated P261.68 billion in revenue for the government since 2002, becoming a major source of funding for various energy resource development programs and initiatives. — Adam J. Ang

On the lifespan of corporations: Terms and conditions

One of the vital considerations when setting up and maintaining a corporate entity in the Philippines is the length of its existence. Shareholders must decide how long they expect the corporation to stand on its feet and stay in operations. Previously, the answer to this inquiry has been restrictively time-bound. 

Under the previous Corporation Code of the Philippines (Batas Pambansa Bilang 68), a corporation cannot exist for a period exceeding 50 years. While this has always been subject to extension, corporations that have reached this maximum “point” cannot initiate the extension earlier than five years before the expiry date.

With various reports filed before state agencies, aggravated by day-to-day corporate documentation, corporations that have set their sights on operating longer than the statutory period run the risk of forgetting, or worse, losing their existence due to faulty filing. Moreover, long-term transactions, and those executed in the latter years of the corporate term, though brief in nature, may suffer or endure a corporate existence issue.

The Revised Corporation Code of the Philippines (RCC), which took effect on Feb. 23, 2019, has made a significant change in this aspect. Under Article 11 of the RCC, the term of a corporation is now perpetual, unless stated otherwise. Depending on their purposes and needs, companies are now conveniently given the option to exist for a prolonged period.

Under Memorandum Circular (MC) 22-2020, the Securities and Exchange Commission (SEC) has issued further guidelines on how corporations, current and prospective, may elect and modify their corporate life in the Articles of Incorporation (AoI).

As a rule, companies that were incorporated before the effective date of the RCC shall now automatically have perpetual existence. By law, the change shall not require further action on the part of corporations. For documentation purposes, however, companies may amend their respective AoIs to reflect this perpetual term. The amendment must be supported by a vote of a majority of the Board of Directors or Trustees, and a vote of the stockholders representing a majority of the outstanding capital stock, including the non-voting shares. For non-stock corporations, the vote of a majority of the members must be secured.

Understandably, some may prefer to keep their existence limited. Even if incorporated before the RCC, these companies should notify the SEC of the intention to retain their original term. The notice must be filed with a Directors’ Certificate, stating that the corporation has elected to maintain the original corporate term as approved by a majority vote of the Board of Directors or Trustees, and a vote of the stockholders representing a majority of the outstanding capital stock, including the non-voting shares, or a majority of the members, for non-stock corporations. Once validated, the SEC shall issue a Certificate of Filing Notice to Retain Specific Corporate Term.

Corporations intending to limit their term must notify the SEC on or before Feb. 23, 2021. Otherwise, their term is deemed perpetual.

Further, MC 22-2020 also grants corporations with a specific term the choice to extend or shorten their existence by amending their AoI. In case of an extension, the application should not be filed earlier than three years before the expiry date of the corporate term. In anticipation of possible changes in the business environment, corporations have the option to change their perpetual existence to specific terms and vice versa. These acts should be approved by vote or written assent of a majority of the Board of Directors or Trustees, and a vote or written assent of the stockholders representing at least two-thirds of the outstanding capital stock of the corporation.

It is instructive to mention that Article 11 of the RCC also allows the revival of corporate existence for corporations whose terms have expired.

This was clarified under MC 23-2019, where the SEC allowed the following entities to file a Petition for Revival of Corporate Existence (“Petition to Revive” for brevity):

a) Generally, a corporation whose term has expired;

b) An Expired Corporation whose Certificate of Registration has been revoked for non-filing of reports, provided that it shall file the proper Petition to Lift its Revoked Status, which may be incorporated in its Petition to Revive, and must settle the corresponding penalties thereof;

c) An Expired Corporation whose Certificate of Registration has been suspended, provided that it shall file the proper Petition to Lift its Suspended Status, which may be incorporated in its Petition to Revive, and must settle the corresponding penalties thereof; or

d) An Expired Corporation whose corporate name has already been validly re-used, and is currently being used, by another existing corporation duly registered with the SEC, provided it change its corporate name within 30 days from the issuance of its Certificate of Revival of Corporate Existence.

The act of revival must be accompanied by at least a majority vote of the Board of Directors or Trustees, and a vote of at least majority of the outstanding capital stock, or the members. Moreover, applications made by banks, banking and quasi-banking institutions, pre-need, insurance, and trust companies, non-stock savings and loan associations, pawnshops, corporations engaged in the money service business, and other financial intermediaries require a favorable recommendation from their respective regulators.

If the petition is meritorious, the SEC will issue a Certificate of Revival of Corporate Existence, restoring to the corporation all its duties, debts, and liabilities that were present before revival. As earlier discussed, the corporation will enjoy a perpetual term of existence, unless the petition specifies another period.

Equitably, stockholders who dissent to any of the changes in corporate term or the revival of the corporate existence must be allowed to exercise their right of appraisal, or the right to dissent and demand payment for fair value of their shares.

These amendments have been a welcome development enabling corporations to carry out their businesses unconstrained by a limited lifespan. With a guaranteed continuity of term, we can only expect a positive impact, and hopefully sustainable growth, on current and future corporate entities doing business in the Philippines.

The views or opinions expressed in this article are solely those of the author and do not necessarily represent those of Isla Lipana & Co. The content is for general information purposes only, and should not be used as a substitute for specific advice.

 

Miguel Jaime C. Encarnacion  is a senior associate at the Tax Services Department of Isla Lipana & Co., the Philippine member firm of the PwC network.

+63 (2) 8845-2728

miguel.jaime.encarnacion@pwc.com

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