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Peso weakens versus the dollar on worsening US-China relations

THE PESO succumbed to the greenback on Wednesday amid risk-off sentiment due to a wider budget deficit in April and renewed tensions between the US and China.

The local unit ended trading at P50.68 per dollar, shedding 15 centavos from its P50.53 close on Tuesday, according to data from the Bankers Association of the Philippines.

The currency opened the session at P50.51 per dollar. Its weakest was at its close of P50.68 while its intraday best was at P50.46.

Dollars traded climbed to $856.48 million on Wednesday from the $491.5 million on Tuesday.

The weaker peso came after the release of the April fiscal deficit, said Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp.

“The peso closed to its weakest in a month after the announcement of wider budget deficit data which showed contraction in government revenues and sharp increase in government expenditures,” he said in a text message.

A record fiscal deficit worth P273.9 billion was seen in April, reversing the P86.9-billion budget surplus in the same month in 2019, according to data from the Bureau of the Treasury.

Meanwhile, a trader said risk-off sentiment due to uncertainties caused by the US-China spat took its toll on the peso.

“The peso depreciated as investors remained cautious amid uncertainty over future quarantine policies beyond May 31 and lingering US-China geopolitical tensions,” the trader said in an e-mail.

For Thursday, Mr. Ricafort and the trader expect the peso to move around the P50.55 to P50.75 levels. — L.W.T. Noble with Reuters

Sotto estimates P548B needed for economic stimulus in 2020

SENATE President Vicente C. Sotto said the chamber’s stimulus bill is expected to require P548 billion in funding for the remainder of 2020 and a further P80 billion next year.

“For 2020, ang expected natin dito kakailanganin ng mga (we estimate a requirement of) P548 billion for the entire year,” Senate President Vicente C. Sotto III said in a virtual briefing, Wednesday. “For 2021, the estimate is around P80 billion.”

Mr. Sotto made the remarks in support of Senate Bill No. 1542, which he said hopes to cover areas not addressed by the Bayanihan to Heal as One Act, or Republic Act 11469, the government’s first major legislation in response to the coronavirus pandemic.

The Senate bill will “restore economic growth, maintain employment levels, and expand the productive capacity of the country,” Mr. Sotto said in a statement Wednesday.

The bill among others provides for mandatory mass testing, wage subsidies for non-essential businesses, freelancers, the self-employed and returning Overseas Filipino Workers.

It will also waive registration and related fees as well as grant special trading accommodations to micro, small, and medium enterprises.

A counterpart measure in the House, approved at committee level Tuesday, proposes funding of P1.3 trillion for the government’s flagship infrastructure projects, mass testing, and wage subsidies among other forms of assistance to those affected by the crisis.

Mr. Sotto said during the videoconference that he expects to fund the bill via loans, savings from previous budgets, and unused 2020 funds.

“Lahat ng available funds na hindi nagamit nitong mga nakaraang taon at itong taon na ito kasama para ma-i-fund ang proposal (All available funds from last year and this year will fund this proposal),” he said.

Mr. Sotto said an extension of the Bayanihan Law’s effectivity will likely be passed by the Senate. “Walang kaduda-duda na ma-e-extend namin yan (Without a doubt we will extend it),” he said in the briefing.

Separately, Senate President Pro Tempore Ralph G. Recto asked the Department of Social Welfare and Development (DSWD) not to delay the second tranche of the social amelioration program (SAP) over local government failures to file the required paperwork.

“The DSWD says that a condition for the release of the second installment of SAP is the local government’s liquidation report on the first wave of the cash distribution,” he said in a statement.

“In ordinary times, this audit rule should be followed strictly. But in the midst of the pandemic, it should be relaxed, not waived, but only insofar as extending the deadline of submission, and not making it a requisite for the release of the next tranche.” — Charmaine A. Tadalan

CREATE bill approval by June 3 seen possible

THE proposed Corporate Recovery and Tax Incentives for Enterprises Act (CREATE) could be approved on final reading ahead of the Congressional break, Senate President Vicente C. Sotto III said on Wednesday.

Mr. Sotto said the Senate Ways and Means Committee will be meeting with the government’s economic managers after Wednesday’s session, which will determine whether the bill will be included on the calendar for deliberations Monday.

“Mag-mi-meeting sila mamaya after the session and therefore makakabalita tayo kung kaya ng sponsorhip on June 1 (They will meet later after the session and we will get word soon if the bill can be sponsored by June 1),” he said in a virtual briefing Wednesday.

“Pwedeng second reading, interpellations ng Monday and Tuesday and then may pag-asang ma-third reading on Wednesday (It’s possible to have second reading and interpellations on Monday and Tuesday and then there is a chance of third reading by Wednesday), or even on the June second itself.”

The measure was certified as urgent by President Rodrigo R. Duterte, thereby allowing the chamber to do away with the three-day interval in approving bills on second and third reading.

House Ways and Means Committee and Albay Rep. Jose Ma. Clemente S. Salceda had said he is open to adopting the Senate version, provided it is “fiscally responsible.”

Congress has until June 3 to act on remaining measures before it goes on a nearly two month break. It is set to resume on July 27.

The CREATE bill is the revised version of the Corporate Income Tax and Incentives Rationalization Act (CITIRA), which now provides for the immediate reduction of the CIT to 25% from the current 30%.

This will further be reduced by 1 percentage point annually beginning 2023 until 2027. In its previous version, the bill proposed to gradually reduce the rate until it reaches 20% in 2029.

The tax reductions were accelerated due to the coronavirus disease 2019 (COVID-19) pandemic. The bill is now positioned as a means of attracting investment from foreign companies looking to move out of China.

“Ito ay mag-e-entice sa mga investors maraming umaalis sa mga lugar na may problema, katulad ng China. Mas maganda ‘yung ang mga investors na ito dito sa Pilipinas (We hope to entice investors moving out of problematic locations like China. We’d prefer that such investors come to the Philippines),” Mr. Sotto also said.

Finance Secretary Carlos G. Dominguez III has described the bill as the “most important economic reform in decades.”

The new version will also extend the sunset period for enterprises enjoying incentives to four years from the 2-7 year period under CITIRA.

The bill forms part of the administration’s comprehensive tax reform program, along with proposals to simplify the tax structure for financial instruments and provide a uniform framework for real property valuation.

The government has so far enacted a measure cutting personal income taxes and increasing or adding levies on several goods and services.

Another law grants an estate tax amnesty and an amnesty on delinquent accounts, while two more laws separately increased the excise tax on alcohol products and conventional and electronic cigarettes. — Charmaine A. Tadalan

Non-expiration of franchises approved in principle by Senate committee

THE Senate Committee on Constitutional Amendments and Revision of Codes approved in principle on Wednesday a measure allowing franchises with pending renewal applications in Congress to continue operating past the franchise expiration date.

The committee was tackling Senate Bill No. 1530, which seeks to address contingencies like the National Telecommunications Commission’s (NTC) decision to issue a cease-and-desist order against ABS-CBN after its franchise expired on May 4.

The NTC said Wednesday that it filed the cease and desist order in light of the quo warranto petition filed by Solicitor General Jose C. Calida, and that it has no authority to grant a provisional franchise.

“We never issued a provisional license to any broadcaster while their franchise was pending in Congress. What happened is we just allowed them to continue operating,” NTC Commissioner Gamaliel A. Cordoba said.

“The difference with ABS-CBN (is that) the case for quo warranto was filed by the Solicitor General, kaya naging untenable (which is why it became untenable) on our part to let it continue.”

Senator Franklin M. Drilon said the bill will address inconsistencies on the part of the NTC in implementing the law.

“This representation sees the very clear inconsistency in the manner in which NTC has applied its power or authority to issue a cease and desist order,” he said.

“There were no cease and desist orders issued to various franchises which expired while their applications were in Congress,” he said.

Retired Supreme Court Justice Antonio T. Carpio said the NTC’s actions constitute “unequal protection” under the law, which the proposed bill will address.

He also recommended that the panel provide retroactive effectivity to ensure the measure addresses the ABS-CBN case, once enacted.

The bill seeks to amend the Revised Administrative code by expanding the coverage of the provision granting the non-expiration of licenses to include franchises.

Senator Francis N. Pangilinan, who chairs the panel, has terminated hearings on the bill, which it plans to “report out by next week.”

Congress has until June 3 to act on remaining legislative measures before it goes on break until July 27. — Charmaine A. Tadalan

Lopez says pandemic warrants review of drug price controls

TRADE Secretary Ramon M. Lopez proposed a review of drug price controls to help the pharmaceutical industry better respond to coronavirus disease 2019 (COVID-19).

Mr. Lopez said at the online membership meeting of the Philippine Chamber of Commerce and Industry Tuesday that the industry should discuss with the government what adjustments can be made to help better address the pandemic.

“Kailangan pag-usapan uli ‘yan kung makakatulong na ma-revise ulit ‘yung programa na ‘yan. (We need a new discussion on whether revising the policy will be helpful)”

“On the other hand, the industry is saying that we might not be able to enjoy the innovations (available),” particularly if price controls cover innovative products.

President Rodrigo R. Duterte in February issued Executive Order (EO) No. 104 setting maximum retail and wholesale prices on certain drugs. It will take effect in June.

The Pharmaceutical and Healthcare Association of the Philippines (PHAP) has said that the government stands to lose P28 billion in revenue from lost corporate tax, value-added tax, and customs duties. The industry group said its own sales will drop by P57 billion from P200 billion due to the price controls.

Mr. Lopez said in a mobile message to reporters that he will not yet comment on whether or not he supports the suspension or delay of the implementation of the order.

“I haven’t reviewed the impact of COVID-19 on the EO. I suggested that DoH (Department of Health) may need to review the pros and cons given different situations now under COVID.”

Executive Order 104 applies to drugs addressing the leading causes of mortality and drugs that have high price differences with those in the international market. It also applies to drugs that have limited competition in terms of generic counterparts or market access and drugs where the innovator product, the first drug containing the approved active ingredient, is the most expensive and most dispensed in the market.

The order applies to 133 drug formulas.

The pharmaceutical industry group has asked to withdraw the measure, “especially at this time when the government needs funds to fight COVID-19.”

PHAP President Beaver R. Tamesis said in a phone interview on Wednesday that price controls disincentivize international companies from entering the market, particularly if they produce drugs that address COVID-19.

He said that he is not certain if COVID-19 drugs are included in the current list of medicines subject to price controls.

He added that the policy environment created by the price control measures along with a lack of patent protection works against the Philippines.

“In an environment where there are price controls, where you cannot get your product registered (right away), what do you think will happen in terms of prioritization to get into the country? So it is a disincentive particularly when you have a crisis,” he said. — Jenina P. Ibañez

DBM sees only P130 billion in budget realignments for stimulus

THE Department of Budget and Management (DBM) said the government has about P130 billion on hand from savings and budget realignments with which to fund stimulus measures, much less than various proposals now being considered in Congress.

Undersecretary Laura B. Pascua told BusinessWorld that the total comes from national government savings and suspended programs, activities or projects (PAPs) from 2020 and leftover funds from 2019’s General Appropriations Act (GAA).

“We can only find funding for them from savings from discontinued PAPS from the 2019 & 2020 GAA. Hence, the economic managers have been saying to Congress that we can only afford a P130-billion fiscal stimulus for this year,” Ms. Pascua said via Viber on Wednesday.

One of the pending measures is the P1.3 trillion Philippine Economic Stimulus Act (PESA) bill recently approved by a House of Representatives committee, which includes P568 billion worth of new programs for rollout within the year.

The stimulus bills proposed by Congress are much larger than the P130-170 billion program proposed by the economic team, including a P50-billion cash infusion to state-owned banks, additional funding for loan guarantees, hiring of contact tracers and relief for large firms.

Ms. Pascua said at P130 billion in new spending and P40 billion projected as foregone revenue when the corporate income tax is reduced to 25% this year from 30% currently, “total deficit impact is P170 billion.”

Ms. Pascua said the DBM will not recommend a supplemental budget this year since according to budget rules, the government can only do so if this is “backed by a new revenue measure.”

Finance Secretary Carlos G. Dominguez III has said that the economic team will not be proposing a supplemental budget since revenue will take a hit from the weak economic outlook and there is “no supplemental revenue.”

Ms. Pascua added that another way for a supplemental budget to be rolled out is for the Bureau of the Treasury (BTr) to issue a certification that “excess funds (are available).”

“We think that the legislators might have forgotten this basic budgeting rule,” she said.

Bangko Sentral ng Pilipinas Governor Benjamin E. Diokno, a Budget Secretary, has said the government might “need” a supplemental budget to provide stimulus, the size of which must be decided by the President along with the economic team.

The National Economic and Development Authority (NEDA) has recommended that the government prepare a supplementary budget for 2020 “to fund critical projects outside the Bayanihan to Heal as One Act.” It made the recommendation in a report issued last month and released to the media last week.

The DBM has been redirecting funds from past priorities to finance programs meant to contain the fallout from the pandemic. — Beatrice M. Laforga

Rural co-ops seek force-majeure relief from power contracts

RURAL power utilities are asking the Energy Regulatory Commission (ERC) to ease their obligations under power contracts entered into with generating companies, while promising to provide consumers relief from bill payments as ordered.

The Philippine Rural Electric Cooperatives Association (Philreca) asked the ERC Wednesday to issue a new advisory allowing electric cooperatives to invoke force majeure clauses in their power supply agreements (PSA).

“As part of our advocacy to provide affordable access to electricity, Philreca asks the indulgence of the Regulators as we appeal again the issue on Prompt Payment Discounts, minimum energy off-take, fix charges, and ‘force majeure’ provisions for the issuance of guidelines or advisory for the benefit of the member-consumer-owners (MCO),” Philreca Executive Director Janeene D. Colingan said in a statement.

A force majeure event is invoked when parties to a contract deem it impossible to fulfill their obligations.

Asked to comment, the ERC said the utilities must first discuss with their partners any changes they would like to make in their agreements, noting the varied impact of the government’s quarantine measures to power utilities.

“The position of the commission is that any modifications to the approved PSA should be discussed by the parties first as we see different impact of the community quarantine to the DUs (distribution utilities),” ERC Spokesperson Floresinda B. Digal told BusinessWorld.

A uniform order on relief for all utilities may not supersede such negotiations, she added.

In April, Manila Electric Co. (Meralco) invoked force majeure in its power contracts, which resulted in the lowering of generation charges in its customers’ May electricity bills.

Philreca warned that higher generation charges will be passed on to customers if the regulator does not allow the removal of such bill components.

“As we have reiterated before, if no intervention is done, paying these fixed charges… will significantly result in a higher generation charge/component in a consumer’s electricity bill,” Ms. Colingan said.

The commission in its May 22 advisory said the availment of prompt payment discounts is subjected to negotiations between utilities and their partners, the benefits from which are required to be shared with customers.

Last week, the ERC told power distributors to allow their customers consuming 200 kilowatt-hours (kWh) or less to settle their unpaid bills from March to May in six installments starting mid-June, while allowing those with below 200 kWh to pay them in four portions.

The regulator warned of penalties against utilities that fail to comply with its advisories on bills payments. — Adam J. Ang

PHL 4G video quality declines in March after lockdown

OPENSIGNAL

FOURTH-GENERATION (4G) video quality in the Philippines declined in March, which most Filipinos spent indoors after the government imposed an enhanced community quarantine (ECQ) to contain the spread of the coronavirus, UK-based Opensignal Ltd. said.

Opensignal, which refers to the quality of 4G video as the “4G video experience,” said on May 25 that in March, when the lockdown was first declared in the middle of the month, “we observed a decline in 4G video experience across all regions.”

Opensignal said 4G video quality declined by 7.2% in urban areas when compared with the experience seen in the previous month, while rural areas saw a decline of 14.7%.

“Despite these declines, the typical 4G video experience in the Philippines ranges from Fair to Good, which suggests that the mobile operators have been able to cope well during these extraordinary times,” it explained.

In the six months to February, Opensignal said 4G video quality improved in most regions.

“While rural users in the Mindanao region saw the biggest improvement of 23.3%, urban users saw the highest improvement of 9.1% in the National Capital Region. In the remaining regions (urban and rural areas combined), the experience improved between 2.9% to 7.8%, with the exception of the rural areas of the Visayas region,” it explained.

In March, users in urban areas in North and Central Luzon saw the lowest declines of 2.6%, while the decline in other regions ranged between 4.6% and 9.4%, Opensignal said.

“South Luzon was the only region where we observed a decline beyond 10%. The video experience declined further as we moved away from the urban centers of the Philippines,” it added.

It said rural users in the Visayas experienced “the smallest decline of 7.5%, while it declined further to 10.3% for users in North and Central Luzon region.”

“The largest reductions were observed by users in the South Luzon and Mindanao region — 16.2% and 21.2%, respectively,” Opensignal said further.

Overall, Philippine consumers continue to enjoy a “good 4G video experience (55-65 on a 100 point scale) in the National Capital Region, and a Fair 4G video experience (40-55) in the remaining regions regardless of whether they are based in urban or rural areas,” it concluded.

Opensignal uses five categories in grading video quality: poor (those with a video experience score of 0-40), fair (40-55), good (55-65), very good (65-75) and excellent (75-100).

The video experience score measures the quality of videos when using a 3G or 4G mobile network, where three factors are considered: picture quality, video loading time and stall rate. — Arjay L. Balinbin

Are we ready for a tax on digital services?

As the world continues to face the effects of the COVID-19 pandemic, the government has acknowledged its immediate fiscal impact, including the adverse consequences on tax collections in recent months. Having missed collection targets by a significant margin starting in March, the Bureau of Internal Revenue (BIR) expects future collections to also fall below target as an effect of the economic slowdown.

With the urgency of generating more funds to continue fighting the pandemic, the government has now put the spotlight on digital services. House Bill (HB) No. 6765, or the “Digital Economy Taxation Act,” was filed on May 19 to capture into the tax system the value created by the digital economy. The bill seeks to impose a 12% value-added tax (VAT) on digital advertising services (such as those on search engines and social media platforms), subscription-based services (including music and video streaming subscriptions), services rendered electronically, and transactions made on electronic commerce (e-commerce) platforms. Moreover, the bill would require suppliers of digital services, network orchestrators, and e-commerce platforms to establish a resident agent or representative office to act as a withholding agent in the Philippines. According to the bill’s explanatory note, it is projected that the proposal would yield about P29.1 billion in new revenue for the government.

GLOBAL PERSPECTIVE
The concept of a “digital services tax” is not new from an international standpoint. As early as 2017, Australia imposed a tax on electronic/digital services. Several territories across Europe have introduced their digital services taxes as of 2020. In Southeast Asia, Singapore and Malaysia have imposed similar taxes starting Jan. 1, while Indonesia will be imposing its tax beginning July 1.

As tax is jurisdictional, each territory has its own set of rules in implementing a “digital services tax.” Nevertheless, there are common characteristics, such as:

Subject matter: While “digital service” or similar term is defined differently per territory, essentially, a digital services tax encompasses cross-border or importation of services primarily available digitally or electronically (e.g., via Internet).

Coverage: Notwithstanding the territories’ different registration requirements, the tax generally covers all companies (including foreign ones) whose digital services are supplied to consumers located within their territories.

Tax base: The tax is generally computed based on revenue generated from consumers within their territories, albeit at a different rate per territory.

CURRENT PHILIPPINE PERSPECTIVE
Although the proposed Digital Economy Taxation Act is still subject to further deliberation, the bill should be contextualized against the current tax rules to understand the rationale for the proposal. In general, Philippine income taxation is based on either: (a) nationality, i.e., resident citizens and domestic corporations are taxed on worldwide income, or (b) territoriality, i.e., individuals other than resident citizens and foreign corporations are taxed on Philippine-based income. Meanwhile, value-added taxation generally covers sales and imports of goods in the Philippines, as well as the performance of services domestically.

While the current Tax Code has gone through numerous amendments, its main provisions emanate from Republic Act No. 8424, a law that was passed over two decades ago. At that time, “traditional” transactions were the norm, and “digital” transactions were practically non-existent. While the BIR has introduced amendments governing innovations (e.g., taxation of software payments and transportation network vehicle services), broadly speaking, the treatment of “digital” transactions remains unclear.

Many of these online transactions are conducted with foreign service providers that do not have Philippine subsidiaries or are not licensed to do business in the Philippines. Thus, for tax purposes, they are non-resident foreign corporations (NRFCs), subject to corporate income tax (CIT) on Philippine-based income and VAT on services performed in the Philippines.

However, the crux of the matter lies on the territoriality of digital transactions. While the dealings are conducted in the virtual realm, without physical stores or facilities within the Philippines, nonetheless, it is arguable that the income or gross receipts from the transactions are generated from Philippine sources. Hence, such transactions must fall within the jurisdiction of Philippine taxation.

POSSIBLE CONSIDERATIONS
The provisions of the Digital Economy Taxation Act and its implementing regulations would determine how Philippine tax on digital services would be imposed. The bill is still at an early stage in the legislative process and is subject to deliberation and changes, thus there are opportunities to iron out possible contentious matters that could arise, including some considerations that I will mention below.

In terms of tax administration, since the companies intended to be covered by the bill are NRFCs that would ultimately be required to transition into resident foreign corporations (RFCs) by virtue of establishing a representative office or appointing a resident agent, would they be required to be registered with the BIR? How would bookkeeping, registration and related requirements apply to these RFCs?

In terms of tax compliance, what would be the RFCs’ tax compliance requirements? Which filing and payment requirements would they need to comply? Will the RFCs be required to issue invoices/receipts in accordance with current VAT invoicing requirements?

There are also other matters, such as reconciling the limited authority of a representative office or a resident agent based on relevant laws, including the restriction on generation of revenues, with the proposed tax administration and compliance measures to be imposed. While the bill supposedly covers VAT, would the RFCs be treated as permanent establishments in the Philippines from an international tax perspective and consequently expose these RFCs to Philippine CIT as well?

Taxing the digital economy has been on the government’s agenda even before the current health crisis. Driven by the need for additional revenue sources, however, our lawmakers are given an even more compelling reason to catch up with rapid growth of the digital economy and bring it into the tax fold.

For digital platforms and service providers, HB No. 6765 could be their new normal moving forward.

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.

 

Marion D. Castañeda is a Manager at the Tax Services Department of Isla Lipana & Co., the Philippine member firm of the PwC network.

+63 (2) 8845-2728

marion.castaneda@pwc.com

Gov’t to keep ban on jeepneys, buses as infections top 15,000

THE ban on jeepneys and buses will remain even after the lockdown in Metro Manil a is relaxed, according to the Metropolitan Manila Development Authority (MMDA), as coronavirus infections topped 15,000.

The 17 mayors of the capital region agreed to keep the ban because physical distancing meant to contain a coronavirus disease 2019 (COVID-19) pandemic is impossible inside these public vehicles, MMDA General Manager Jose Arturo S. Garcia, Jr. said at a news briefing on Wednesday.

The Department to Health reported 380 new infections on Wednesday, bringing the total to 15,049.

The death toll rose to 904 after 18 more patients died, it said in a bulletin. Ninety-four more patients have gotten well, bringing the total recoveries to 3,506, it added.

The mayors reached the decision during a Tuesday meeting where they also recommended that the metro lockdown be relaxed and for businesses to reopen starting June 1, he said.

“We know that with our jeepneys and buses, they’ll stop and go. They’ll let riders in and they’ll stop everywhere. It’s hard to monitor,” he added.

Point-to-point buses, taxis, tricycles, ride-hailing services and company shuttles will be allowed, Mr. Garcia said.

Presidential spokesman Harry L. Roque on Tuesday said an inter-agency task force made up of Cabinet secretaries was scheduled to discuss whether to relax the lockdown on Wednesday.

The government would probably ease the lockdown in Metro Manila and nearby cities starting June 1, Interior Secretary Eduardo M. Año said on Tuesday as the government tries to restart the economy that a coronavirus pandemic has brought to a near standstill.

He added that there was a proposal to classify areas into zones, allowing villages to keep a stricter lockdown if needed.

President Rodrigo R. Duterte locked down Luzon island in mid-March, suspending work, classes and public transportation to contain the pandemic.

The lockdown in some areas has since been relaxed, while Metro Manila remains under an altered quarantine until the end of the month, where some businesses have been allowed with minimal workforce.

Meanwhile, 282,923 people have been tested — 21,585 positive and 261,338 negative results, DoH said in a report.

Health Undersecretary Maria Rosario S. Vergeire said they were working with the Department of Interior and Local Government (DILG) in hiring contact tracers.

“The DILG may also consider tapping our barangay health workers and social workers in support of our national response against COVID-19,” she said at an online new briefing.

Also yesterday, the Justice department, citing data from the Bureau of Corrections said 161 prisoners have been infected with the coronavirus, six of whom died. Eight prisoners have recovered.

The national penitentiary in Muntinlupa City had the highest cases with 82 and the Correctional Institute for Women in Mandaluyong City had 79, it said in a statement. — Gillian M. Cortez and Vann Marlo M. Villegas

House subpanel OKs bill on new normal

By Genshen L. Espedido, Reporter

A SUBPANEL of a House committee tackling anti-coronavirus measures has approved a bill mandating social distancing and the use of face masks in public under the so-called new normal.

The measure is expected to be passed by the committee on Thursday, after which it will be debated in plenary.

Under the bill, gatherings and the flow of people in public markets, parks and plazas will be “highly regulated.”

Gatherings in private places will also be regulated and may be stopped by the local government if it is shown that people ignored safety measures against the novel coronavirus.

The operation of motorcycle taxis will remain suspended to prevent the spread of the virus through shared helmets and close physical contact between the rider and passengers.

Passengers in all types of public transportation must wash or sanitize their hands before boarding the vehicle, be seated one seat apart, wear a face mask at all times, and pay through contactless methods.

The bill provides for “green lanes” on the road network for health care, emergency, law enforcement and supply-chain vehicles.

The bill also seeks to suspend classes and other school activities until further notice “without prejudice to the academic freedom and levels of autonomy of institutions of higher learning,” provided that no student is unreasonably penalized for their inability to participate in online learning.

Educational institutions must set up online learning platforms. Funding for research and development of systems for learning continuity during times of crisis will be made available by the National Government.

Restaurants may reopen with take-out and delivery service only, while gradually re-introducing in-store dining.

The bill recommended that buffets and salad bars be discontinued temporarily to create more space in the dining area.

Malls and other commercial establishments must limit the number of people inside their premises and enforce contact-less sales and customer service.

The Philippine Statistics Authority (PSA) must fast-track the implementation of the Philippine Identification System Act to facilitate contact-tracing.

The bill also calls on the Department of Information and Communications Technology (DICT) to expedite and fully implement a national broadband program.

Other government agencies must develop and implement a system for facilitating government transactions through online platforms.

Violators will be jailed for two months or fined P50,000.

If passed, the measure will be effective for three years or sooner once the President declares that the health crisis is over.

Also yesterday, Malacañang said Congress should extend the special powers given to Mr. Duterte to deal with the health crisis by at least three more months.

“We’ll see from there if at the end of 90 days, there’s a need for emergency powers still, then it can be extended until December,” Mr. Roque said, according to a transcript of his interview with the ABS-CBN News Channel.

Socioeconomic Planning Acting Secretary Karl Kendrick T. Chua said the President’s special powers should be extended until the end of the year. — with Gillian M. Cortez

Former PDEA chief to head Clark Airport

PRESIDENT Rodrigo R. Duterte has appointed outgoing Philippine Drug Enforcement Agency (PDEA) chief Aaron N. Aquino to head Clark International Airport Corp., his spokesman said on Wednesday.

Mr. Aquino’s nomination as president and chief executive officer of the airport operator was approved and forwarded to its board, presidential spokesman Harry L. Roque said at an online news briefing.

On Tuesday evening, the presidential palace said Wilkins M. Villanueva, PDEA’s regional director for Northern Mindanao, would replace Mr. Aquino as the agency’s chief.

“My utmost gratitude to President Rodrigo Roa Duterte for giving me his trust and confidence to lead our country’s war on drugs,” Mr. Villanueva said in a social media post on Tuesday. “I will never fail you Mr. President.” — Gillian M. Cortez

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