THE closure of Petron Corp.’s refinery in Bataan is imminent if all industry players will not be accorded a level playing field, its top executive said on Tuesday.

“Kailangan maging level playing field. Kung hindi maging level playing field ang Petron refinery with the importers, magsasara na rin kami sigurado. Kailan iyon? Very soon (We should be on a level playing field. If Petron will not have a level playing field with the importers, we will close our refinery for sure. When? Very soon),” Petron President and Chief Executive Officer Ramon Ang said in a virtual briefing.

Ang told reporters the listed oil company “will go to that direction” if the same situation persists.

Energy Secretary Alfonso Cusi said the Department of Energy (DoE) is yet to receive a notification from Petron on its supposed plan to permanently close its refinery in Limay town.

Nonetheless, the agency will closely monitor the developments.

In a statement, Cusi said, “whatever business measures Petron will arrive at in the course of its discussion with the concerned parties, we at the DoE will respect the management’s decision.”

Double tax hits refinery biz

The point of contention, according to Petron’s top executive, is the double imposition of taxes: one on the imported crude oil upon its arrival and another on the finished product.
On the other hand, importers are taxed once for selling petroleum products.

Sought for comment, Finance Secretary Carlos Dominguez 3rd said the refinery business is “a supply chain issue rather than a tax issue.”

But for Laban Konsyumer Inc. President Victorio Mario Dimagiba, the imposition of fuel excise taxes under the Tax Reform for Acceleration and Inclusion law makes refinery operations in the country no longer viable.

“We note that in the refinery, there might be market and timing issues including the importation of crude at a high price, then after refining the world crude prices might be lower, thus, refining margins could be lower,” Dominguez said in a message to reporters.

“On the other hand, an importer, who imports finished products can sell these products right away, making him less vulnerable to oil price movements,” he added.

Dominguez explained the excise tax (and duties) on importation of finished products is imposed upon importation and on locally refined products, it is imposed upon removal from place of manufacture.

So, at the time of marketing or sale, the excise tax in both instances should have already been paid, he added.

“Petron and Shell should have read this in 2018 that Train was not equitable tax policy at their end of the business,” said Dimagiba, a former Department of Trade and Industry undersecretary, referring to the Tax Reform for Acceleration and Inclusion law.

The 180,000 barrel-per-day oil refinery in Bataan, inaugurated in 1961, is now the lone refinery in the Philippines.

In August this year, Pilipinas Shell permanently shut its refinery in Tabangao, Batangas that would be transformed into a full import and storage terminal for finished products.

Chevron was the first to close its refinery in Batangas in 2003 and was subsequently converted into a finished-import terminal.

Should Petron decide to halt operations of the Bataan refinery for good, the country “will be at the mercy of foreign suppliers,” according to Petron.

Dimagiba shares the same sentiment, saying this “will make the country make us dependent to foreign supply and prices.”

Amendment of tax law key to level playing field

Ang said the only way to achieve a level playing field is to go to Congress and have the existing tax laws amended even though this is a long and tedious process.

“The only way to save this is if we can go to Congress at ma-level playing field,” Ang said, adding all questions to be raised by legislators have to be addressed.

But Dominguez thinks otherwise.

“We don’t need to change our tax on this. It’s happening worldwide, refinery margins are getting squeezed. Big oil companies have been shutting down their refineries in various parts of the world,” he said.

Ang said, “iyong refinery business today nakapahirap talaga. Makita mo sa buong mundo marami na ang nagsasara (it is difficult to manage a refinery business today. Around the world, a lot of refineries have already shut down).”

Cusi said the Energy department is looking into the taxation concerns raised in coordination with the Department of Finance. “At the same time, we are also evaluating how a closure scenario would impact pricing, as well as the country’s energy security.”

Dimagiba is proposing that the government should mull buying back Petron, which he said was once a state-owned entity through Philippine National Oil Co.

“The environment where Covid-19 (coronavirus disease 2019) will linger should be a driving criteria. We should offer to buy back Petron from Ramon Ang,” Dimagiba said.

Petron shares tumbled by 0.62 percent to end at P3.20 each on Tuesday.

TOKYO: Asian markets fell Tuesday following a sharp sell-off in New York and Europe that was fuelled by fears a coronavirus resurgence will force fresh economically painful containment measures.

Traders have also given up almost any hope for a new US stimulus package being passed before next Tuesday’s election, with Democrats and Republicans blaming each other, though there are still expectations a new deal will be agreed afterwards.

The need for a big-spending rescue for hard-hit Americans is being highlighted by a big jump in new infections across the country that observers fear will deal a blow to an already shaky economic recovery.

Data this week is expected to show record US growth in the third quarter thanks to a multi-trillion-dollar stimulus agreed earlier this year alongside huge Federal Reserve support.

However, that follows a record contraction in the second quarter, while economists have tipped the economy to shrink this year.

“The second and third wave spread of Covid-19 is possibly triggering a point of no return for some industries as the economic damage borders on irreversible,” said Axi strategist Stephen Innes. “The Covid-19 induced downward spiral continues accelerating.”

With an eye on next week’s vote, he added: “We should expect price action to remain choppy in the days ahead, with investors very reluctant to put on any significant risk ahead of what promises to be a headline heavy week or two.”

David Kelly, at JP Morgan Asset Management, added: “A stimulus bill in the lame-duck session is urgently needed and could be supplemented by a more comprehensive measure when the new Congress meets, early in 2021.”

On Wall Street, the Dow suffered its worst day since early September, dropping more than two percent while the S&P 500 and Nasdaq also suffered sharp losses. That came after Frankfurt was hammered more than three percent, with Paris and London shedding more than one percent.

And the selling continued in Asia, though the retreat was not as painful. Tokyo and Shanghai fell 0.3 percent, along with Taipei and Singapore. Hong Kong sank 0.4 percent, while Sydney, Wellington and Manila were all down more than one percent.

Seoul edged up slightly, though, after data showed the South Korean economy grew more than expected in the third quarter thanks to a big jump in exports. “The Covid case news flow has clearly resonated,” Chris Weston, head of research at Pepperstone, said in a note.

“The reflation trade which was working so beautifully is being part unwound—not because of election re-pricing, but due to the new wave of Covid cases.”

Chinese e-payments giant Ant Group was planning to stop taking orders for the Hong Kong leg of its $34 billion mega-IPO owing to it being massively subscribed, Bloomberg News reported.

The dual listing in Hong Kong and Shanghai is tipped to be the biggest in history and would value the firm at about $315 billion, bigger than Wall Street financial titans Goldman Sachs and JP Morgan Chase. Its shares are slated to debut on November 5.

The Securities and Exchange Commission (SEC) has issued the guidelines on the conversion of corporations either to a one person corporation (OPC) or to an ordinary stock corporation (OSC) through SEC Memorandum Circular 27, Series of 2020 (SEC MC 27, s. of 2020). This is in line with Sections 131 and 132 of Republic Act No. 11232 or the “Revised Corporation Code of the Philippines” (RCC), which allows the conversion from an OSC to an OPC, and an OPC to an OSC respectively. SEC MC 20, s. of 2020 took effect on Oct. 16, 2020.

SEC MC No. 27, s. of 2020 is divided into three parts: the first part pertains to conversion from OSC to OPC; the second part, conversion from OPC to OSC; and the third part on provisions common to both kinds of conversion. Below are some of the salient features of SEC MC 27, s. of 2020.

Conversion from OSC to OPC

A natural person of legal age, a trust, or an estate (single stockholder) may apply for the conversion of an OSC to an OPC if he has acquired all of the OSC’s outstanding capital stocks and has obtained the required certificate authorizing registration or tax clearance from the Bureau of Internal Revenue. The conversion may then be processed as an amendment of the articles of incorporation (AOI) through the submission of the required documents to the SEC (Section 1, SEC MC 27, s. of 2020).

Once the SEC issues the certificate of filing of the amended AOI reflecting such conversion to an OPC, the OSC’s AOI and Bylaws shall be deemed superseded (Section 2, SEC MC 27, s. of 2020) and the OPC converted from an OSC shall succeed the latter and be legally responsible for all the latter’s outstanding liabilities as of the date of approval of the conversion (Section 4, SEC MC 27, s. of 2020). Please take note that the original SEC registration number will still be retained but the corporate name will bear the OPC suffix (Section 3, SEC MC 27, s. of 2020).

Conversion from OPC to OSC

Once the shares in an OPC ceases to be solely held by a single stockholder, a conversion to an OSC may come into place. This can be done after due notice to the SEC of such facts and of such circumstances leading to the conversion, and after compliance with all the requirements for an OSC. The commission determines, after evaluation of the documentary requirements, if such conversion is applicable (Section 7, SEC MC 27, s. of 2020).

Following the transfer/s of shares in an OPC wherein there are now at least two stockholders in what was once the OPC, a notice of conversion of an OPC into an OSC shall be filed with the commission within 60 days from such transfer/s of shares. The period for filing the notice shall be observed even though the conversion will be applied for, or will take place, afterward (Section 8, SEC MC 27, s. of 2020).

However, if the notice is filed beyond the 60-day period from the transfer of shares, the conversion into an OSC may still be approved but is already subject to prior payment of penalty if found liable for the violation of Section 132, in relation to Section 158 of the RCC on administrative sanctions, after due notice and hearing (Section 10, SEC MC 27, s. of 2020).

The OPC’s AOI shall be deemed superseded once the SEC issues the certificate of filing of the amended AOI reflecting such conversion to an OSC (Section 11, SEC MC 27, s. of 2020) and the OSC converted from an OPC shall succeed the latter and be legally responsible for all the latter’s outstanding liabilities as of the date of conversion (Section 13, SEC MC 27, s. of 2020).

The certificate of filing of amended AOI and bylaws shall still bear the original SEC registration number. Please note also that the “OPC” suffix should be removed (Section 12, SEC MC 27, s. of 2020).

Provisions common to both kinds of conversion

Below are the common provisions to both kinds of conversion:

The signatory or signatories in the AOI of the converted corporation must clearly state that they voluntarily agreed to the conversion applicable to them (Section 15, SEC MC 27, s. of 2020).

The reason of the nature of the conversion from an OSC to OPC shall be deemed as optional; while for the conversion from an OPC to OSC, this is considered mandatory, unless when the winding-up and dissolution are appropriate (Section 16, SEC MC 27, s. of 2020).

In case of opposition or dispute arising from the conversion, the aggrieved party may file a verified petition for cancellation of the issued certificate with the SEC’s Company Registration and Monitoring Department (CRMD), on the ground of fraud in the procurement, in accordance with the SEC’s applicable laws and other rules or issuances (Section 18, SEC MC 27, s. of 2020).

The operator of low-cost carrier Cebu Pacific is ending its deal with SIA Engineering Co. Ltd. (Siaec) involving joint venture companies.

In a disclosure on Tuesday, Cebu Air Inc. (CEB) bared the plan to acquire 905,641 shares or 51 percent stake of Siaec, the aircraft maintenance, repair and overhaul (MRO) unit of Singapore Airlines, in Aviation Partnership (Philippines) Corp. (APPC).

The deal, with each share is priced at $6.19, would amount to $5.6 million, CEB said.
APPC, founded in 2005, is a joint venture between CEB and Siaec, which provides line maintenance, light aircraft checks, technical ram handling and other MRO services to the budget carrier and other airlines. It has presence in Manila, Cebu, Davao and Clark.

“The acquisition is in line with CEB’s overall strategy to more closely align its line maintenance operations and strategic objectives with CEB’s network and service requirements, for significant operational efficiencies and optimization of resources for an even stronger competitive advantage,” the airline told the local bourse.

In a separate disclosure, CEB also said it inked a share sale and purchase agreement with Siaec to divest its 35 percent shareholding in SIA Engineering (Philippines) Corp. (Siaep).

Siaep, a joint venture between CEB and Siaec established in 2008, is focusing on airframe maintenance, repair, de-lease checks, cabin retrofits and overhaul services for 737, A320 and A330 aircraft, as well as line maintenance services in Clark, Pampanga.

“The consideration to be received is $7.74 million in cash,” it said.

“The change in CEB’s ownership of Siaep is not expected to have a material impact on the net assets or earnings per share of the CEB for FY (fiscal year) 2020,” the firm said.
Shares in CEB fell 4.05 percent or P1.65 to close at P39.05 each on Tuesday.

Forty Philippine companies are set to showcase various healthy and natural food selections in the country’s third participation in the China International Import Expo (CIIE) at the National Exhibition and Convention Center, Shanghai, China on November 5 to 10, 2020.

In a statement on Tuesday, the Department of Trade and Industry (DTI) said the Philippine delegation will focus on healthy and natural food products to tap into the growing demand for nutritious fruits, snacks and ingredients in China. The delegation is under the FOODPhilippines banner led by DTI through the Center for International Trade Expositions and Missions (Citem).

Food segments that will be featured are tropical fruits and vegetables, processed fruits and nuts, healthy snacks, seafood and marine products, and other premium food selections. “Exciting products that will be featured from the Philippines are our luscious mangoes, sweet bananas, versatile coconuts, and tangy pineapple. We want the Chinese market to see the Filipino ingenuity and creativity in transforming these fruits into scrumptious snacks, refreshing juices, and other flavorful offerings,” said Citem Executive Director Pauline Suaco-Juan.

The FOODPhilippines pavilion will also showcase emerging tropical fruits such as durian, calamansi (Philippine lime), guava, and passion fruit. Seafood products including tuna, milkfish, squid, and shrimp will also be available in different packaging, including frozen cuts, in can and sausages.

Sy Group’s SM Prime Holdings saw its consolidated net income slump by 48 percent to P14.4 billion in the first nine months of the year from P27.6 billion in the same period last year. The integrated property developer in a filing on Monday said its consolidated revenue for the period also declined by 29 percent to P60.7 billion from P85 billion year-on-year.

SM Prime president Jeffery Lim said their core businesses, especially their malls, exhibited a slight recovery as the government began to reopen more industries to aid the economy in the second half of the year. Lim added that they also tightened their expenses, achieving a “major reduction” in operating expenses quarter-on-quarter. The revenue of SM Prime’s Philippine mall business for the period was down 57 percent to P18.3 billion from P42 billion in 2019. Its rental income likewise slipped by 52 percent to P16.8 billion from P35.1 billion year-on-year. Meanwhile, the revenue of the firm’s residential business headed by SM Development Corp. climbed 7 percent to P34.2 billion from P31.9 billion. SMDC’s reservation sales in January to September also inched up to P66.7 billion from P66.4 billion last year.

Filipinos are demanding a more comprehensive plan from the Duterte administration to address transportation woes amid the coronavirus disease 2019 (Covid-19) pandemic, a study conducted by data analytics firm WR Numero showed.

Quarantine controls have been eased since the past weeks as the government hopes to revive the Philippine economy, but workers continue to face problems from the country’s mass transportation system.

“As Filipinos adjust to the demands of the national health situation, they are also demanding for the government to do more to solve transport issues during the pandemic,” said WR Numero Research Chief Executive Officer Robin Michael Garcia during a briefing on Tuesday.

“They are expecting the government to adopt better policies and that these should be implemented properly,” he added.

The study titled “Public Transportation Amid a Pandemic: Digital Perceptions and Sentiments” touched issues on reopening of deltamarket reviews more routes for public utility vehicles (PUVs), boosting passenger capacity in train networks, including financial assistance to jeepney drivers.

Twenty-five percent of the respondents wanted the Department of Transportation (DOTr) to open more routes and increase public transport supply, while 26 percent called for the return of provincial buses.

As of early October, the government has allowed the operation of the following PUVs in Metro Manila: 27,016 units of traditional public utility jeepney (PUJ) plying 302 routes; 845 units of modern jeepneys with 48 routes; 4,016 units of public utility buses plying 34 routes; 387 units of point-to-point buses with 34 routes; 286 provincial buses with 12 routes; 3,263 units of UV Express with 76 routes; 40 units of modern UV Express with two routes; 24,356 units of transport network vehicles; and 20,927 units of taxis.

This month, the DOTr also increased train ridership ranging from 13 percent to 18 percent, to 30 percent.

Last week, the government also gave the go-signal for the resumption of the motorcycle taxi pilot run.

WR Numero Research said it used Tangere, a mobile app-based survey form to conduct a survey to 5,000 adult respondents nationwide.

Unique proprietary digital listening and sentiment analysis software called Pathos was also used to collect and process millions of digital data, specifically Facebook data including posts, engagements and sentiments.

“I am hopeful because in step with explanation of the financial managers, this weak spot is pushed by outside forces just like the strengthening of US economy and improve of its hobby prices,” he said.

Dooc has conceded that the enterprise might not attain its P280 to P300 billion target variety in phrases of total rates, noting that even the lower stop of the industry’s goal of P280 billion is not likely to be hit.

“The target of P280 billion is not likely to be hit. If we examine first 1/2 even from final yr, we’re a bit down,” he said.

In the primary 1/2 of the yr, decrease sales of life insurers pulled down the top class profits of the coverage industry by 9.12 percentage to P105.Fifty two billion from P116.11 billion a 12 months in advance.

The existence coverage sector posted an income of P82.20 billion, down 16.Eighty three percent from P98.83 billion within the identical similar length. Non-lifestyles insurers recorded P19.69 billion, up thirteen.95 percent from in the equal similar length. Non-lifestyles insurers recorded P19.Sixty nine billion, up thirteen.Ninety five percentage from P17.28 billion.

The Insurance Commission (IC) is constructive that the increase of the industry will get better within the 1/3 sector of the yr despite the current weak spot in financial markets.

“I am optimistic that inside the 0.33 zone, we are able to submit modest boom due to the fact the majority of the top rate is generated by using variable, which is also dependent to the performance of the financial system and different factors like the peso and inventory marketplace,” Insurance Commissioner Emmanuel Dooc stated at the sidelines of the Financial Literacy Program launch of Japan-based totally Foundation of Advancement of Life and Insurance Around the World (FALIA) and Philippine Life Insurance Association (PLIA) on Wednesday.

Even if the peso and the stock market aren’t acting nicely at gift, Dooc stated he is hopeful that the weak point will not final long sufficient to have an effect on the industry.

The cases are many of the most urgent of some 8,000 weighing on Deutsche, and CEO Cryan has promised to remedy them by means of the stop of the yr.

The lender’s woes come as European banks whinge of a harsh enterprise surroundings, confronting low interest fees reducing into their income margins, anemic economic growth, fierce competition and excessive necessities on the amount of capital they need to maintain as a buffer in opposition to future crises.

European Central Bank president Mario Draghi rejected attempts to blame him for Deutsche’s travails.

“If a bank represents a systemic risk for the eurozone, this can not be due to low interest costs,” he told reporters in Berlin after assembly with German lawmakers.

In the boss’s chair at Deutsche Bank for a bit over a year, Cryan has launched a massive restructuring of the Frankfurt group and plans to cut down nearly 9,000 jobs international by 2020.

Shares in the financial institution have lost extra than half of their price since January after it booked an nearly 7-billion-euro loss in 2015.

But Die Zeit is to file on Thursday on plans via Berlin “if the worst involves the worst” to promote off components of Deutsche to other monetary institutions, and possibly buy a 25-percentage stake.

Some voices in the government choose related to the European Single Resolution Mechanism, set up within the wake of the economic disaster to prevent taxpayer bailouts of failing banks, the newspaper stated.

In that case, creditors and customers might undergo a share of the rescue charges—doubtlessly growing fresh chaos at the economic markets.

German officials accept as true with trying to intercede with the USA government could be “doubtlessly counterproductive”, Die Zeit said in an extract sent out on Wednesday.

Deutsche faces in addition looming issues within the form of an research by using New York regulators into alleged cash laundering at its Russian branch.