The public, Abaya said, deserves a reliable train system, and the MRT Corp. (MRTC) has failed to provide that for quite some time now. Hence, the government had to make a move to fill that gap and try to improve the line’s services. 

Abaya, also president of the Lib-eral Party, is asking MRT Holdings Inc. (MRTH) Chairman Robert John L. Sobrepeña to drop the case seeking to stop the government from adding 48 new train cars to the aging system. “The riding public deserves a much better MRT 3 than what the

www.businessmirror.com.ph ■�Saturday 18, 2014 Vol. 10 No. 40 P. | | 7 DAYS A WEEK■�Wednesday, July 29, 2015 Vol. 10 No. 293

A broader look at today’s businessBusinessMirrorBusinessMirrorTHREETIME

ROTARY CLUB OF MANILA JOURNALISM AWARDEE2006, 2010, 2012U.N. MEDIA AWARD 2008

ROTARY CLUB

JOURNALISM

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S “C,” A

PESO EXCHANGE RATES ■ US 45.5360 ■ JAPAN 0.3694 ■ UK 70.8540 ■ HK 5.8749 ■ CHINA 7.3333 ■ SINGAPORE 33.2598 ■ AUSTRALIA 33.2283 ■ EU 50.5131 ■ SAUDI ARABIA 12.1429 Source: BSP (28 July 2015)

SPECIAL REPORT

COMMUTERS HOPEDTO BENEFIT IN TAXI,UBER, GRABCAR TIFF

CAB drivers block an avenue to protest the Uber ride-sharing service in Rio de

Janeiro, Brazil, on Friday. Cab drivers complain that Uber represents unfair

competition, because its drivers and their cars are not submitted to regular

inspections by city officials. AP

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Conclusion

COMMUTERS cringe at the sight of Epifanio de los San-tos Avenue (Edsa) during rush

hours, knowing they only have a few options in navigating it. One is to ride the Metro Rail Transit (MRT) Line 3, which of-fers passengers with very little space to breathe after a full day’s work. Another is to stay at the workplace, kill time and wait for

the congestion to subside. The third option is to take a cab. But this could be pricey at times, |especially if the driver insists on getting a few extra pesos because the road is congested. But another option emerged when transport network companies (TNCs) entered the Philippine mar-ket in 2014, carrying a set of goals with them, including the introduc-tion and the promotion of the ride-sharing lifestyle.

MRT Holdings told to drop case vs govt

ABAYA SAYS SOBREPEÑA GROUP HINDERING MRT LINE 3 UPGRADE

Creba seeks constant talkson HLURB policy on ads

‘AQUINO’S LAST SONATO HAVE LITTLE TO NOIMPACT ON MARKETS’

INSIDE

D1

Life Wednesday, July 29, 2015

Life BusinessMirror

Life Editor: Gerard S. Ramos • lifestylebusinessmirror@gmail.com

OH Lord, Jesus Christ, in presenting ourselves H Lord, Jesus Christ, in presenting ourselves before Thine adorable Face to ask of Thee the before Thine adorable Face to ask of Thee the graces of which we stand in greatest need, graces of which we stand in greatest need,

we beseech Thee, above all, to grant us that interior we beseech Thee, above all, to grant us that interior disposition of never refusing at any time to do what disposition of never refusing at any time to do what Thou requires of us by Thy holy commandments and Thou requires of us by Thy holy commandments and divine inspirations. May we develop interior closeness divine inspirations. May we develop interior closeness with You always. Amen.

� at interior disposition

THE GOLDEN ARROW, THOMAS A. NELSON AND LOUIE M. LACSONTHE GOLDEN ARROW, THOMAS A. NELSON AND LOUIE M. LACSONWord&Life Publications • teacherlouie1965@yahoo.comteacherlouie1965@yahoo.com

AUTOPSY DETAILS EMERGE ON DEATH OF WHITNEY HOUSTON’S

DAUGHTER »D2

B A J � e Associated Press

NEW YORK—Google’s new servicefor organizing and backing upimages blends some of the best ofwhat Apple and Yahoo! have rolled out in recent months.

These services come as smartphone cameras get better, and people take more photos and video with them. The problem is many of the images simply sit on the phones, taking up valuable space. Worse, digital memories can disappear when phones are lost or stolen.

Photo services from Google, Yahoo! and Apple all store copies of those photos and video online. Images taken with tablets and stand-alone cameras can be added, too, giving you one home for your entire image library. These services also offer editing tools and help organize your images. After all, why bother taking photos if you can’t find them later?

The latest offering, Google Photos, isn’t perfect. Recently, Google apologized when the service mistakenly labeled two black people as gorillas. And there’s a catch with free storage of photos and video. On the other hand, Google has the best tools for searching photos. That’s no surprise, coming from the world’s most popular search engine.

Here’s a look at Google Photos and how it compares with Apple’s and Yahoo!’s offerings.

STORAGE AND BACKUPJUST download the Google Photos app on your iPhone, iPad or Android device and connect over Wi-Fi. Photos and video on your device will automatically upload to Google’s servers.

Google offers unlimited storage of photos of up to 16 megapixels. That covers iPhones and Samsung Galaxy phones. For the few phones that exceed that, Google will either reduce the file size or let you store the original as part of a free allotment shared with Gmail messages and other Google services. You get 15 gigabytes, enough for a few thousand photos at 16 megapixels, after which you pay $2 or more a month. If you choose to store the originals, all photos will count toward the quota, including those under 16 megapixels. Unless you’re looking for poster-size prints, 16 megapixels is fine for

printing, but the extra pixels help when cropping.Free video storage is limited to 1080p high-definition

resolution. That’s fine for iPhones, but many devices, including the Galaxy S6 phones, can shoot better. Again, you can choose to reduce the size or pay for more storage. Apps for Mac and Windows PCs will search your computer and camera memory cards for photos to upload. The same size limits apply.

Flickr, a similar service from Yahoo, has no size limit on individual files, but you get 1 terabyte for your entire collection. That’s likely more than enough unless you’re a professional or serious photographer, in which case Yahoo! likely wouldn’t be for you because it doesn’t handle images in the higher-quality RAW format.

Apple’s Photos app syncs images from iPhones, iPads and Mac computers only, not Android or Windows devices. You have 5 gigabytes of free iCloud storage, shared with other Apple services, so you’ll likely need to buy storage starting at $1 a month.

With Google and Yahoo!, you need to delete images from your phone to free up space once they transfer online. With Apple, the service automatically reduces the file size when space is low and grabs the originals online when needed. That makes it seamless for users, but Apple’s storage quota isn’t as generous.

EDITING AND SHARINGALL three services offer basic tools for touching up photos. Apple’s Photos app on the Mac has the most advanced options. With all three services, changes you make on one device will sync with the others. Google also has tools to automatically create collages and animations out of batches of photos.

Once online, you can view images from any device, no matter which camera they came from. You can easily share those images, too, with just a tap or two. Don’t worry. Unless you share an image or album, it’s for your eyes only.

ORGANIZING AND PRIVACYGOOGLE, Apple and Yahoo! use computer software to tag photos to help you find them more easily.

Google and Apple use face-recognition technology to sort photos by individuals, while Yahoo! knows only that there’s someone there—not who. Google was even smart enough to automatically group together photos of

the same person at 2 months old and 6 years old (though it missed the ones from right after birth). With Apple, you can link them manually on a Mac. Apple’s index is stored on the app, rather than online, limiting what the company has on you.

Google does the analysis online, but insists it doesn’t attach faces to specific individuals. Although privacy is something to consider, it isn’t much different from trusting Google with your email and searches.

As for objects, Google and Yahoo! let you search for “boat” to get photos containing boats, even if “boat” isn’t in the file name. That’s because the companies scan images to identify common objects and attributes. You can remove a tag when there’s a mistake, but you can’t add your own. What if you have a bunch of boat pictures, might you start seeing ads for sailing lessons? Google and Yahoo! say they have no current plans to target ads that way, but neither ruled it out. ■

THE latest trends, developments and practices in technology in connection with education will be highlighted at DigiTech Manila Expo 2015, slated on September 17 and 18, at Function Room 1 of the SMX Convention Center in Pasay City.

DigiTech Manila Expo aims to educate and inspire technology enthusiasts and providers by being a space for learning, exchanging ideas and networking.

The expo will highlight the different issues and opportunities of

current technology, with a main focus on education.

It will engage the participants—from educators, school administrators and researchers to publishers, content providers and software and hardware suppliers—in the discussion on the transformative characteristics of technology.

A colocated event of the expo is the National Conference on Technology and Education, and the conference will focus on the role of technology in the growth and

development of Philippine education. It will equip educators for the 2015 Asean Integration on education by introducing technology and digital trends and practices.

Its end goal is to encourage informative, innovative and creative teaching and learning in competitive schools and cooperative classrooms.

DigiTech Manila Expo 2015 is organized by Primetrade Asia Inc. For information, e-mail conference@primetrade.com.

TECHNOPHILES are in for a treat, as global technology leader LG Electronics recently announced its “Red Tag Sale” (goo.gl/f3X0qI), where gadget enthusiasts can avail goo.gl/f3X0qI), where gadget enthusiasts can avail goo.gl/f3X0qIthemselves of premium LG smartphones at pocket-friendly prices. The sale is ongoing until August 2.

Smartphone fans can take home P5,700 worth of freebies, including a 32GB microSD card worth P1,000 and a battery pack worth P2,500, when they purchase the acclaimed flagship LG G4. They also get 100GB additional Google Drive storage for an extended period of two years worth P2,200.

For bargain hunters, LG is slashing P2,000 off on the LG G3 Stylus and LG Magna. Allowing users to scribble notes and random musings on its 5.5-inch IPS LCD capacitive touchscreen with the accurate and convenient Rubberdium stylus pen, the LG G3 Stylus is pegged at only P9,900, while the LG Magna, launched only last summer with an 8-megapixel rear camera and a 5-megapixel front camera, is priced at only P7,990 during the sale.

“LG has made a name for itself as a company that produces innovations that not only entertain but also become an integral part of the lives of our consumers. The Red Tag Sale is a way for us to show our appreciation to our customers by offering great deals on quality products,” LG Mobile Philippines Vice President Jay Won said.

Find great smartphone dealsin LG ‘Red Tag Sale’Google photo service

is strong on search

The latest in edu-technologyat DigiTech Manila 2015

Wednesday, July 29, 2015

IN this screen shot made on July 22, editing tools available within the Google Photos mobile app are demonstrated on a panoramic iPhone photo shot on July 4, at Kauffman Stadium in Kansas City, Missouri. AP

BusinessMirrorBusinessMirror

E1 | Wednesday, July 29, 2015 Editor: Tet Andolong Editor: Tet Andolong

With various con�gurations, styles, and manners of facilities and amenities situated in key locations—now is de�nitely an exciting time for the real estate market, especially for buyers who have more and better options to choose from.

Given that the primary function of a condominium in the property industry is convenience, Vista Residences (VRI) has been seamlessly incorporating the various elements that will contribute to this and is, thus, proudly o�ering clients an array of home options at various price points. �e company continues to rise to the challenge of o�ering only the best and raising the bar for other developers to try and follow suit.

Vista Residences:Jumping right in to make dreams come trueAS the condominium arm of Vista Land, the country’s premier property developer—VRI has the experience, expertise, reach, loyalty and full support of her mother company. So, when the company dug its �rst foundations about a decade ago, it was gung ho from the start.

One powerful advantage of being part of the country’s top real estate company is being born with an acquired and carefully studied knowledge of the Philippine buyer,

as well as the global property investor market. With all that going in, Vista Residences structured its objectives, building designs, programs, and services based on what the markets want and need today. �is also helps give the group the ability to predict how those same markets will grow through time—evolving the company, its towers, and services suitably. By improving designs, creating more services, bolstering the lifestyle facilities, �nding convenient locations and jumping on global hot buttons like green architecture, VRI tells its markets what to ask for, while realizing that everything the group does must also be directed towards understanding their markets’ dreams and making them real.

Beyond this understanding and appreciation of their buyers’ psyches, VRI has also seen it necessary to keep tabs on their residents and future buyers with research that reveals what compels people to buy a home and what makes them happy. In 2014, following a massive Vista Land-commissioned research on awareness and satisfaction ratings among potential homebuyers in the country, and across all real estate brands, the company conducted a second study among current Vista

VISTA RESIDENCES: RAISING THE STAKES FOR THE FILIPINO CONDOMINIUM BUYER

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THE local condominium market is steadily growing and becoming increasingly

competitive as evidenced by residential towers and communities being developed left and right.

Land homeowners to learn what they have or want to say about their experience. It was a study formulated to allow the various companies identify areas of success and the improvements that can be incorporated into their future plans and strategies. VRI homeowners are quite content with their purchasesTHE study was speci�cally designed to identify the customers’ reasons for purchase, unmet needs and wants, diagnose strengths and weaknesses, pinpoint areas for improvement, establish growth opportunities and determine overall satisfaction.

An interesting pro�le of the VRI market emerged: More than half are single and the rest is a split between newlyweds and young couples with children. Most of the buyers were living in their own home—most likely the family’s

home when they purchased their unit and the rest were renting. A signi�cant number of buyers purchase their units as second homes while the others buy them as their primary domiciles. �is bodes well for the property industry as it indicates that many Filipinos are in the market for more than one piece of real estate.

It was also found that upon deciding to buy a unit, only a handful canvassed among di�erent developers, while almost half of the buyers already had VRI in mind and around 30 percent were hoping to get a Vista Residences condominium.

Why did they prefer VRI? �ere were two drivers: One is accessibility—60 percent speci�ed the convenient locations of the Vista Residences towers; and two, 40 percent chose Vista Residences because they trust the Vista Land

brand and believed they are a “well-known developer.” Majority of those asked claimed to be satis�ed with their “home in the sky” and the tower or complex they lived in. In fact, 50 percent will de�nitely consider buying from VRI again, while the others consider recommending a Vista Residences property to other people.

VRI residents are very happy with their choiceIN the study, the respondents’ high level of satisfaction was equated with “happiness.” When asked what they were happy with, the number one reason was location—their “homes” came with easy access to commercial establishments, hospitals, schools, markets and transport hubs. �e second cause of happiness was safety and security— the 24-hour security guards stationed at the entrances and on patrol at night, the �re prevention systems and CCTV gave respondents considerable peace of mind.

�ird, and almost at par with each other, were the “nice ambience” and the facilities that came with their condo. �e residents were delighted with their community’s ambience and exclusivity. �ey felt their condominiums were “classy” and they loved the “design” of their buildings. As for the utilities, residents said they were very happy with the electricity; clean water supply; back-up generators; paved, wide roads; cable; and

internet services. Plus, they felt the properties and their environs were “well maintained.”

Upon turnover, the respondents were very pleased that the property was in excellent condition. �ey were also actually quite satis�ed with the price of their condo unit, claiming that the reservation fee and down payment were very reasonable, and the value of their property appreciates. �e numbers validate VRI’s processes and hard work, but they also indicate that the group should not rest on its laurels. �e competition can only get sti�er, so the group needs to up the ante even more and stay ahead of the pack.

Vista Residences: Thoughtful and sustainable designVISTA Residences carries with it VISTA Residences carries with it VISTAVista Land’s nearly four decades of experience in developing properties and creating master planned communities. In addition to this, the company is committed to assuming a chief role in the condominium sector, creating greater awareness of their capabilities, as well as enhancing e�ciencies in their resource distribution.

Learn more about the Vista Residences properties, call 650 0753 or 0999 8871705, visit www.vistaresidences.com.ph. For news and updates, follow vistaresidenceso�cial on Facebook and vistarescondo on Instagram.

THE Laureano di Trevi is a three-tower condominium along Don Chino Roces Avenue in Makati. This vertical community boasts of a commercial and leisure podium linking the towers.

VISTA Residences’ The Currency in Ortigas CBD is sensibly practical. Its stylish units are designed with space to breathe. Its amenities, like the fitness gym, first rate.

USING only top-of-the-line materials, the Vista Residences’ Avant at the Fort is known for its hotel ambience—extravagant spaces with a stunning high-ceiling lobby.

WITH the Mosaic Tower in Legaspi Village, Makati , Vista Residences has successfully integrated building green with functional living, luxurious amenities and enthralling design.

AS with the rest of Vista Residences condominium properties, the amenities at Trevi Towers, located in the heart of Makati, have its residents’ convenience in mind

LIFE D1

PROPERTY OF THE MONTH

GOOGLE PHOTO SERVICE

PROPERTY E1

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THE financial community brushed aside the sixth and final State of the Na-

tion Address (Sona) of President Aquino, saying that the hours-long elocution should have little to no influence on the markets at all, economists said.

Bank of the Philippine Is-lands (BPI) economist Nicholas Mapa and ING Bank Manila chief economist Joey Cuyegkeng said the presidential speech on Mon-day proved to be of little signifi-cance to the financial markets, and has not affected trading at the local currencies and equities markets either way.

“Nothing truly compelling in this Sona. Expect more campaign-ing in the coming months,” Mapa said in an e-mailed response to the BM. “The State of the Nation Ad-dress of the President is unlikely to cast a strong influence on the market,” Cuyegkeng said. A day after the President’s two-hour Sona, the local curren-cy closed 6 centavos stronger to 45.5 per dollar, from the previous day’s close of 45.56 per dollar.

“There was a lot of comparison with the previous administration, but, perhaps, the better measure would have been to measure his performance against potential, which this administration failed to maximize,” Mapa further said. But, while the presidential

speech absolutely had no bear-ing on how the local currency traded at the Philippine Deal-ing & Exchange Corp., the peso was seen weakening some more in the immediate term due to the Bangko Sentral ng Pilipi-nas’s (BSP) lack of action on its monetary-policy stance. “The peso could remain on the defensive. After breaking above the five-year high on Monday mor-ning and absence of monetary-policy support, especially with some analysts in the past two weeks calling for monetary easing via an RRR [reserve requirement ratio] cut, the peso may be targetting 45.75 per dollar,” Cuyegkeng said. But, despite the forecast con-tinued deceleration of inflation and weak financial-market sen-timent, Cuyegkeng said the BSP was likely to keep the monetary- policy settings unchanged at the next monetary-policy meeting.

BSP Gov. Amando M. Tetangco Jr. earlier said inflation in July this year could range from 0.5 percent to 1.3 percent.

“The BSP is likely to keep policy settings steady for now, despite very near-term disinflation and higher financial-market volatil-ity.... BSP monetary policy-makers have argued that the tightening in 2014 was in response to market ap-prehension of US Fed tightening,” Cuyegkeng said. The BSP will be having its next monetary-policy meeting on August 13. 

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THE Chamber of Real Estate and Builders’ Association Inc. (Creba) is calling for a

balanced implementation of the Housing and Land Use Regulatory Board’s (HLURB) tightened policy on property ads. Noel  M. Cariño, president of Creba, made the call following the publication of a statement of the  United Print Media Group

(UPMG) expressing its opposition to the HLURB’s recently implemented Board Resolution 921, which re-quires developers to secure prior approval from the agency for their television and print ads. 

According to the resolution, only when the HLURB has issued a proj-ect’s license to sell and has approved its promotional material can the de-veloper advertise it.   “We support the stand of the HLURB to ensure that buyers’ inter-

est is upheld. But, at the same time, we want a reasonable balance; we want to dialogue constantly, and have workable compromises if there will be a negative impact,” Cariño said in a telephone interview. 

The Creba president conceded there have been complaints from association members on the regula-tion. However, he said, it is necessary to prevent unscrupulous developers from hoodwinking consumers. 

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WHILE President Aquino clearly blamed the private owner of the Metro

Rail Transit (MRT) Line 3 for the deteriorating state of the train system, his close ally, Transportation Secretary Joseph Emilio A. Abaya, has a word of his own. 

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  “GrabCar exists for ride sharing. If one company has about 10 vehicle owners that choose not to use their cars on a daily basis and use our services instead, imagine its effect on Edsa,” Bautista said. “They could share a ride or two, which can pick them up and drop them off along a certain route. We can help free up the traffic in Manila.”  Cua added: “Instead of paying for gas, parking, and instead of driving along busy streets, now people have the option. It frees up parking, and as more and more people share a car, we will be seeing lesser cars on the road.” Not for everyone, but inclusiveBoTh company and government officials admitted that these types of services are not for everyone. But it does not mean they are not inclusive. An Uber ride, for example, can only be paid via credit or debit card. Its transactions are cashless. World Bank data showed that only 31 percent of Filipinos have bank accounts and only 18 percent of all adults in the poorest 40 percent of households in the Philippines have bank accounts. “Nobody is forcing people to use Uber. We

are opening up options to people. At the end of the day, it’s all about choice. People are given a choice, and they vote by their wallets,” Cua said. Transportation Secretary Joseph Emilio A. Abaya emphasized that the entry of these kinds of services in the Philippine market promotes the government’s drive for social inclusion. “Providing the public with an ad-ditional option in public transportation is precisely for social inclusion—that is as clear as day,” he said. The Cabinet official said he is dumb-founded as to why critics are saying these companies promote social exclusivity. Left-ist groups pointed out that applications like Uber and GrabCar widen the gap between the poor and the rich. “What is interesting is why such critics would prefer to deprive people, especially those with limited options to begin with, of more alternatives,” Abaya said. Challenge to taxi drivers and operatorsABAyA added that these app-based, ride-hailing companies give taxi operators and drivers the needed nudge for them to im-prove their services. “It encourages other public-utility vehicles (PUVs), such as taxis, to innovate and im-

prove their services by modernizing their fleet; adopting technology to improve their services, such as the use of GPS and Waze; and raising the standards for their drivers among others,” he said. Ginez added: “I know and understand that TNCs are not for everyone. There is still a market for taxis. And while TNCs impose a competition with taxis, in a way, it should help in upgrading our taxis—that is now our challenge to them.” But Philippine National Taxi operators Association President Jesus Manuel C. Sun-tay is not convinced. he pointed out that taxi services have al-ready improved, saying that the government should look at another angle to this issue. “We have already improved our services. yes, there are still taxis that are not entirely good, but these are just small cases. We, as an industry, are being generalized,” Suntay said. he added that those taxis that have dismal services continue to operate because the LTFRB allowed them. “Was it not the LTFRB that issued the franchise, that checks if the unit is still roadworthy? If there are old taxi units along the road, who, in effect, dispatched them?” Suntay emphasized. he also called on Ginez to seriously look

into the supposed malpractice of TNCs. Under LTFRB rules, taxi drivers are barred from naming a specific price to a customer and are mandated to use a meter. They are also not allowed to choose their customers. “But these TNCs, Uber and GrabCar, are the ones that name the price to their custom-ers. They also choose the ones that they pick up. There is no crime in their part. But when a taxi driver does that, it is illegal. how un-fair is that?” the chief of the taxi operators group lamented. Taxi drivers, he said, resort to these kinds of practices because they don’t get paid all too well. “If we want quality drivers, let’s allow them to have quality income,” he said. Innovate furtherMAINTAINING that TNCs are here to stay, Abaya reminded them that they should com-ply with the requirements of the law. Ginez also warned Uber, which still does not have a license to operate, that he will go after the company should it continue oper-ating even without filing for a provisional authority to offer taxi-like services. “We can penalize them, go after them and reimpose our anti-colorum drive. But they have feelers that they are going to apply, and we will give them a deadline,” he said.

The transport chief also challenged these operators to further innovate and improve their services. “The only help—and, at the same time, obligation—needed from them is to continue providing decent, safe, convenient and ef-ficient services to commuters. Beyond that, we have required access to some degree of origin-destination data, which they are able to collect easily because of GPS technology. This helps in transportation planning. Last, it would be a bonus if they could innovate even further, and in the process, encourage other PUVs to, likewise, adopt to these innovations for the benefit of the public,” he said. Cua and Bautista assured that they will continue to be more innovative in providing tech-based services to the Filipino public. “We are open to more competition, as it helps us improve ourselves,” Bautista added. Abaya also hopes that there will be more TNCs to emerge in the coming months. “It is our hope that other TNCs enter the industry, to provide more options to riders. We also hope that Filipino app developers are able to take advantage of this opportunity to create their own software, as well. Most important, we want other PUVs—such as taxis—to in-novate, modernize and improve their services, rather than to be left behind,” he said.

Continued from A8

news@businessmirror.com.ph BusinessMirrorWednesday, July 29, 2015 A2

BMReportsCommuters hoped to benefit in taxi, Uber, GrabCar tiff

BusinessMirror news@businessmirror.com.ph A4

Economybriefs

citizenwatch: who’s afraid of amending the constitution’s economic provisions?Consumer advocate CitizenWatch.ph has expressed strong support for the approval of resolution of Both Houses (rBH) 1, which proposes to amending the economic provisions of the Constitution. rBH 1, authored by House speaker Feliciano r. Belmonte Jr., seeks to amend Articles XII (national economy and patrimony); XIV (education, science and technology, arts, culture and sports); and XVI (general provisions). The amendments would include the phrase “unless otherwise provided by law” to certain sections to allow Congress to pass legislation that would ease restrictions on foreign ownership in certain industries to attract investments and generate jobs. Wilford Wong, CitizenWatch secretary-general, said liberalizing the Philippine market will create much-needed employment opportunities, both in the urban and rural communities, while more competition will foster better services and competitive prices to the benefit of Filipino consumers. In a news statement, CitizenWatch stated that removing these policy roadblocks will send a strong and clear signal that the Philippines is ready to compete for more employment-generating foreign investments for its talented Filipino labor force.

b.i. orders probe into unauthorized release of 22 chinese migrant workersImmIgrATIon Commissioner siegfred B. mison has ordered an immediate investigation into the reported unauthorized release from custody of at least 22 Chinese, who were apprehended in an operation in Pasay City on Tuesday last week. The “missing” Chinese were among the 191 foreign nationals, mostly Chinese, who were caught working as call-center agents/online-gambling operators in an office building.

However, only 169 of these alleged illegal workers were brought to the Bureau of Immigration main office for inquest proceedings.

mison said 21 of those released without authority were claimed to possess Cagayan economic Zone Authority (Ceza) special visas; one appeared to be unaccounted, or missing.

“Ceza visas are company- and station-specific. mere possession of this particular visa does not automatically absolve the holder of any liability under immigration laws. The company and the place of work must still be established in order to validate that the visa is legitimately used,” the BI said in a news statement.

Further investigation showed that 14 more foreign nationals were released from custody for presenting valid work visas. Joel R. San Juan

William Ruccius, business development di-rector of Enfinity, said there is a vast potential for solar-hybrid deployment along SPUG areas. “Napocor has 280 SPUG power plants. They range in size from 0.04 megawatt [MW] to about 10 MW,” he said. These off-grid areas are currently being serviced with their electricity needs via diesel-fired power- generating facilities, which, Ruccius said, tend to be more expensive. He said that the true cost of generation rate in these areas typically ranges from P14 per kilowatt-hour to P45 per kWh, and electricity is just being made available to them from eight to 16 hours a day. Part of the electricity cost being paid by consumers in SPUG areas is covered by subsi-dies, but when cheaper alternatives, such as hybrids, will be provided, that level of subsidy

may also be reduced. However, Ruccius stressed that there are stil l some commercial and market risk is-sues that need to be addressed in the regula-tory and policy frameworks of the industry before hybrid solutions can become viable in these areas. He particularly cited the creditworthiness pre-dicament of many electric cooperatives, including those that have been catering to the service needs of the SPUG areas. “The problem here is that many electric coop-eratives are not creditworthy and it is difficult to get paid. The QTP [qualifying third party] provides the generation and also takes over the distribution function, so it collects the money and pays itself,” he said, while pointing out that financing is the biggest challenge if appropriate framework is not in place.

THE United States on Monday again placed the Philippines at Tier 2 on its three-tier ranking system, which means Manila is

yet to fully comply with the minimum standards for the elimination of trafficking in person (TIP). US Secretary of State John Kerry released the 2015 Trafficking in Persons Report. The TIP report provides the most comprehen-sive information on government efforts around the world to combat modern slavery. The country got the same grade of Tier 2 in 2014. According to TIP, the Philippines is a source country and, to a much lesser extent, a destination and transit country for men, women and children subjected to sex trafficking and forced labor. The State Department determined that the Philippines made significant efforts to combat human trafficking. The report, however, urged Manila to increase its efforts to hold government officials administratively and criminally account-able for trafficking and trafficking-related offenses through criminal prosecutions, convictions and stringent sentences. According to Kerry, the US government recog-nized the efforts of the Philippine government to bring justice to victims and expedite prosecu-tions. During the reporting period, the country convicted 54 traffickers, an increase from 31 the previous year. The report also notes the strong efforts to pro-vide antitrafficking training to local authorities, with a particular focus on disaster-stricken regions. “We recognize the government of the Philip-pines’s progress on trafficking in persons, and we look forward to continuing our close cooperation to tackle this regional and global issue. As part of our global efforts to combat human trafficking, the US government is committed to working with the government of the Philippines to prevent traf-ficking activities, to prosecute perpetrators, and to protect victims, “ the report added. Recto Mercene

Wednesday, July 29, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

Human trafficking still prevalent in Philippines Solar-hybrid option seen

to resolve power-supply deficit in off-grid areas

By Lenie Lectura

SOLAR power provider Enfinity Asia Pacific Holdings Ltd. said on Tuesday that solar-hybrid solutions will address the lack of power in off-

grid areas, including those that are under the small power utilities group (SPUG) of the National Power Corp. (Napocor).

House Committee on Ways and Means Chairman and Liberal Party Rep. Romero Quimbo of Marikina said the technical working group (TWG) of his panel is now final-izing the consolidated version of the measure. “We’re happy that the President stated it [during his last State of the Nation Address on Monday],” Quimbo said. “The TWG is now finalizing the RFI bill...so we are very pretty con-fident that we will be able to finish it by December at least in the lower chamber,” he added. Quimbo said the RFI bill will be passed into law before the 16th Con-gress ends in June next year.  According to Quimbo, the gov-ernment is losing billions of pesos by giving incentives.

“We lose P148 billion in 2013 on fiscal incentives but [with the passage of the RFI bill] we want to make sure that we will only remove incentives to those industries that don’t deserve it…. However, those who deserve it, meaning those that generate jobs, like manufacturing, as well as export-oriented, we will not only protect them but we will, in fact, even increase their incentives so that we can make it competitive,” the lawmaker said.  Quimbo said that industries need to be export-oriented, and must be able to attract foreign direct invest-ments to get incentives. Earlier, Quimbo said the Joint Foreign Chamber and the Phil-ippine business groups have ex-pressed concern for the passage of the RFI.

news@businessmirror.com.ph Wednesday, July 29, 2015 A5BusinessMirrorEconomy

“They expressed concern over fiscal incentives rationalization. But I gave them assurance that the fiscal incentives rationalization bill we will pass shall be something that will make our investment climate more attractive and not the con-trary,” the lawmaker said.  The RFI bill has been facing strong opposition from business groups due to its provisions, particularly the lifting of the tax- and duty-free incentives of several industries. Under the RFI draft bill submitted by the Department of Finance (DOF) and Department of Trade and Indus-try (DTI) to the House Committee on Ways and Means, companies regis-tered with the Philippine Economic Zone Authority (Peza) are given two options in the measure.  They can opt for a four-year income-tax holiday (ITH) with ei-ther 5-percent tax on gross income earned (GIE) in lieu of local and national taxes, except value-added tax (VAT) and real-property tax (RPT) for 11 years, or 15-percent reduced tax on corporate income in lieu of local and national taxes, except VAT and RPT for 11 years, the bill said.  Peza-registered companies un-der the second option are given the choice of either 5-percent GIE for 15 years, in lieu of local and national taxes, except VAT and RPT for 15 years, or 15-percent reduced tax on corporate income in lieu of lo-

House leaders assure passage of RFI bill by DecBy Jovee Marie N. dela Cruz 

AdAy after President Aquino asked Congress to prioritize the passage of the Rationalization

of Fiscal Incentives (RFI) bill, the chairman of the House Committee on Ways and Means on Tuesday said that the lower chamber will pass the measure by december.

cal and national taxes, except VAT and RPT for 15 years. Quimbo, citing the DOF-DTI draft bill, said that it is a policy of the state to grant investment incen-tives that encourage long-term and recurrent investment, are simple to administer, time-bound and whose performance and outcomes are eas-ily verifiable.  Earlier, the DTI urged Congress to pass the RFI bill in 2015, fearing it might be overrun by events if not approved within the year. Meanwhile, Liberal Party Rep. Jerry Treñas of Iloilo has said the lawmakers should carefully review

the RFI bill.    “Fiscal incentives rationalization, however, must be done after careful review by the concerned government financial agencies and upon proper consultation with the affected indus-tries. We must ensure that proposed legislation rationalizing incentives should not adversely affect our ongo-ing programs that encourage direct investments and the growth of local industries,” he said.  Deputy Majority Leader and Na-tional Unity Party Rep. Magtanggol T. Gunigundo of Valenzuela said that any rationalization must be predi-cated on a tax system that is easy to

comprehend and comply with. Also, Abakada Rep. Jonathan de la Cruz and Cibac Rep. Sherwin Tugna supported the passage of fis-cal incentives rationalization.  “I am for the enactment of the bill. It is about time we rationalize our tax regime if we are to be glob-ally competitive,” de la Cruz said.  For Tugna, “I may support to amend the current incentives to be reasonable, making them  a win-win situation for both the government to get revenue from taxes. However, the bill should not dissuade foreign investors and make our country at-tractive to foreign investors.” 

Back in harness Commuters from southern Metro Manila disembark from Philippine National Railways (PNR) commuter train and take a jeepney ride to their destinations at the Espana Station in Sampaloc, Manila, on Tuesday. The train service was suspended for two months after one of the PNR's trains got derailed near the Magallanes Station in Makati City in May. At present, the train service is limited from the Tutuban Station in Divisoria, Manila to Alabang in Mutinlupa City and vice versa. PNA

Wednesday, July 29, 2015

OpinionBusinessMirrorA6

On the Sona: Only one question for President Aquino

editorial

The President’s State of the Nation Address (Sona) delivered before Congress on Monday highlighted what the Aquino administration claims as its accomplishments in the last five years: high growth rates of the economy, high employ-

ment rates, reduction of graft and corruption, faithful service to the “bosses,” etc. The address reaped 150 applauses from Congress, high grades from some groups, and mediocre, including outright failing grades, from yet other groups.

The address needs to be carefully analyzed and evaluated, to separate the grain from the chaff, the truths from the falsehoods, the objective facts from the political spin, so that we, as a people, will know where we really are and how we can reach our goals. Pending the conclusion of what can be a time-consuming exercise, for that is what a careful analysis and evaluation will be, we raise one question for the President to answer.

In the last year of the Gloria Macapagal-Arroyo administration in 2010, our gross domestic product (GDP) grew at an annual rate of 7.6 percent. What pushed this growth rate down to 3.2 percent in 2011, 6.6 percent in 2012, 7.1 percent in 2013, 6.1 percent in 2014, and 5.2 percent in the first quarter of 2015?

We venture an explanation: On your election as president in mid-2010, you inaugurated in our country a period of what you called “matuwid na daan,” or what your critics call a period of pet-tiness, political vindictiveness and vengeance. Right from the beginning, you bannered “saving” hundreds of millions of pesos from “graft-ridden” contracts of your predecessor, impounding the so-called savings. Result: Shrinkage of GDP growth rate. The same mentality persisted begin-ning in 2012, impounding so-called savings, or savings as realized from “honest” bargaining for best price. Result: Underspending; performance of GDP below potential.

Sadly, this is public exhibition of gross ignorance. every student of economics 101 knows that savings, taken away from the people as taxes to begin with, must be plowed back into the economy as increased consumption or increased investments, otherwise, the economy will shrink.

But one can say that that is ignorance at a personal level—a bad commentary on the quality of mind of the person concerned, but not an affront to the Filipino people. except that, in this case, a poor personal quality has impacted negatively on the lives of 100 million Filipinos.

Consider: If in the period 2011-2014, our economy had grown at an average rate of 7.5 percent per year, instead of the actual 5-percent growth rate, our per capita income of today, assuming that our population growth rate remained the same, would have been about 15 percent higher than what it actually is. Meaning, our per capita GDP should be P145,000 instead of the P126,000 today.

This underperformance is what needs to be explained to the Filipino people: Why they must accept the economic reality of today, under the leadership of President Aquino, and not that more prosperous economy that they richly deserve. They say that the Social Security System’s (SSS) programs

provide assistance from womb to tomb, or from cradle to grave. It provides cash assistance for child-birth or maternity,

sickness, disability, old age or retirement, and death. I say, even beyond death, members’ beneficiaries are cared for with death benefits or survivorship pension, as well as the funeral grant.

PanIc is in the air as china suffers its biggest one-day stock plunge since 2007. It shouldn’t be. The 8.5-percent slide in the Shanghai composite Index is actually a development that

could leave china better off eight years from now.

Caring from womb to tomb

The good news in China’s stock plunge

Let me talk about the SSS funeral grant. Recently, the SSS announced an increase in the funeral benefit starting august this year. The funer-al benefit is a cash amount granted

to whoever pays for the burial or funeral services of the deceased SSS member and, usually, that is the im-mediate family. Starting august 1, the amount of funeral benefit will no

I’m focusing on eight both because it’s an auspicious number in chinese folklore (the Beijing Olympics didn’t begin on 8/8/08 by accident) and Beijing’s idea of nirvana. Growth returning to 8 percent (relative to this year’s 7-percent target) would buttress President  Xi Jinping’s re-formist bona fides. Instead, stocks fell by that much on Monday as Xi’s magic has lost potency. Why is that a good thing? It’s at once a reminder that rationality is returning to main-land markets and a message to Xi to stop putting the financial cart before the proverbial horse.

Since mid-June, when shares began sliding, Xi’s market-rescue squad has tried  everything imag-inable: interest-rate cuts, margin-lending increases, bans on short selling, a moratorium on initial public offerings, hauling suppos-edly rogue traders in for a talking to, ordering state-run institutions to buy shares, halting trading in at least half of listed companies, you name it. What Xi hasn’t tried is up-grading the economy and financial

system in such a way as to help the stock market thrive.

To find out what he should do next, Xi could do worse than to check in with henry Paulson. even though Paulson might regard with scorn chi-na’s love of the number eight, it was on his watch as Treasury secretary in 2008 that the US had its own brush with financial collapse.

Paulson has been merciless in his all-hype-and-no-fundamen-tals critique of Xi’s government. “china is especially vulnerable at this point because, while its economy has grown and matured, its capital markets have lagged behind,” he wrote in the Financial Times. “It is no surprise that those ideologically opposed to markets would use recent events to make the opposite argument—that to prevent market instability, Bei-jing should slow the pace of fi-nancial liberalization or perhaps even abandon market-based re-forms altogether.” yet, he argued, “while Beijing’s instinct to protect investors is understandable, the

longer be a fixed amount of P20,000, but will range from a minimum of P20,000 to a maximum of P40,000. It will be calculated using the fixed amount of P20,000 plus 5 percent of the member’s total contributions multiplied by the average Monthly Salary credit (aMSc) or: P20,000 + (0.005% x (number of contributions x aMSc) ) = funeral benefit (not to exceed P40,000).

Following the formula, a member who has contributed for 21 years and accumulated a total of 250 monthly contributions and an average month-ly salary credit of P4,000 will have an additional P5,000 on top of the minimum P20,000 for his or her funeral grant, or a total of P25,000.

For some, talking about one’s fu-neral benefits might seem morbid.

But for the more practical-minded who believe that the only certain thing in life is death, preparing for it is part of one’s expression of caring for one’s loved ones. The SSS funeral grant might not totally assuage the grief of the member’s bereaved fam-ily, but it will surely help in defray-ing the cost of giving the deceased member a decent burial.

For more information about the SSS and its programs, call our 24-hour call center at (632) 920-6446 to 55, Monday to Friday, or send an e-mail to member_relations@sss.gov.ph.

Susie G. Bugante is the vice president for public affairs and special events of the Social Security System. Send com-ments about this column to susiebu-gante.bmirror@gmail.com.

best way of doing so is to create a modern capital market.”

That’s why  ambivalence  toward Xi’s titanically large market interven-tions could be a positive. It refocuses Beijing on what’s needed to recreate the vibrant markets that prevail in new york and hong Kong. Xi’s com-munist Party has tried and failed to stabilize things by edict. In fact, heavy-handed manipulation has set back Beijing’s designs on making the yuan a global reserve currency and getting Shanghai shares included in MScI’s indexes.

as Paulson points out, no nation has ever achieved high-income sta-tus with a closed market system that misprices risk. The longer Xi’s men delay adopting international stan-dards of capital allocation, transpar-ency and basic trust in markets, the bigger the odds china will experience a Japan-like crash, circa 1990.

In recent days, the International

Monetary Fund has, according to Bloomberg news, urged china to unwind measures taken to stem the stock sell-off. This week Vice Finance Minister Zhu Guangyao said the real challenge is how regu-lators exit without incident. But af-ter Monday, the odds favor Beijing getting even more deeply involved in markets that are proving less docile than its 1.3 billion-person-strong population.

With Shanghai shares now below the psychologically important 3,800 level (there it is again—the number eight), the question isn’t investor confidence but Xi’s. any government might step in with “circuit breakers” as market losses outpace economic logic. at some point, though, Xi must realize he’s losing perspective, as well as control. Isn’t it odd, for example, that trading has become more vola-tile even as half of listed companies are shut off? Talk about the laws of unintended consequences! Really, if this isn’t a good argument for letting markets work as they’re supposed to, what is?

Xi’s legacy was supposed to be recalibrating china’s economy and opening the financial system. Turns out, it’s battling stock short-sellers. That leaves china’s leader with a choice: either create the fundamen-tals needed to support rich stock valuations or keep putting the entire weight of the government against hedge funds. The longer china does the latter at the expense of the for-mer, the 8- percent figures in its future will be for stock losses, not economic growth.

BLOOMBERG VIEWWilliam Pesek

All About Social SecuritySusie G. Bugante

The legacy of President Xi was supposed to be recalibrating China’s economy and opening the financial system. Turns out, it’s battling stock short-sellers. That leaves China’s leader with a choice: Either create the fundamentals needed to support rich stock valuations or keep putting the entire weight of the government against hedge funds.

Wednesday, July 29, 2015

OpinionA7BusinessMirroropinion@businessmirror.com.ph

A troubling but necessary ally against Islamic State

It’s been almost a century since t.E. Lawrence and the Arab Revolt kicked the Ottomans out  of syria. Now the turks are coming back, this time with Us air support, in a plan to

establish a 60-mile-long buffer zone on the syrian side of the border between the two countries.

If the creation of a new mini-state within the borders of a Middle East-ern state seems worrisome, that’s because it is. As the Israelis learned to their detriment in Lebanon in the 1980s and 1990s, such semiper-manent security zones are costly to maintain and produce strange unin-tended consequences—like the birth of Hezbollah.

Syria’s civil warBUt, as crazy as it sounds, the buffer zone might be better than the alter-natives, because it could be a first step toward boots on the ground capable of defeating Islamic state (Is).

since the collapse of syria began, the turkish government has been fo-cused on two competing objectives. One is to weaken and ultimately defeat syrian President Bashar

al-Assad, which has meant support-ing the Free syrian Army militias.

the other turkish goal is to push back within syria the Kurdish mi-litias, which have both participat-ed in the fight against Assad and taken advantage of the vacuum to expand their territory. turkey fears and loathes the rise of Kurdish na-tional feeling in the region, because Kurds in Iraq and syria sympathize with the PKK, a militia that seeks to control majority-Kurdish territory within turkey.

A buffer zone in syria, backed by Us air power, serves both these turk-ish interests. If executed properly, it’ll weaken syrian sovereignty by establishing a piece of turkey inside syria. And it’ll give turkish troops a zone to push Kurdish militias farther to the east.

Until now, the turks haven’t been prepared to enter syrian territory and stay there—partly because it would involve them in head-to-head combat with Is. But  that’s changed  after a bold suicide attack last week against Kurdish volunteers in turkey who were headed over the border to fight Is. Now turkish President Recep tayyip Erdogan needs to show the sunni militant group—and his do-mestic constituency—that he won’t tolerate Is taking the fight to turkey.

the other actor in all this is the Us, which until recently would’ve been horrified by the idea of turkey carving out a piece of syria, much less by the notion of facilitating the land grab from the air. President Barack Obama’s syria strategy (if it can be dignified with that word) has, from the start, been plagued by a deep ambivalence about Assad’s fate. And the Hamlet-like indeci-sion—should the Assad regime be or not be?—hasn’t been quelled by the passage of time.

What’s more, in Iraq, the Kurdish minority has been a steadfast Us ally, and in truth the only set of actors in that troubled country on whom the Us has been able to rely since 2003. turkey is a close ally, too, of course. the Us hasn’t embraced dreams of Kurdish statehood in Iraq or more broadly, but it also has no deep in-terest in the turks weakening the

Kurdish forces in syria.the Us, nevertheless, has a press-

ing need for the buffer zone, because it’s desperate to make inroads—any inroads—against Is. the only way to do that is with local ground troops. No sunni Arab ground force has emerged to fight the militants. that leaves Iranian-trained and Iranian-officered shiite militias in Iraq. And in syria, where the Free syrian Army hasn’t managed any meaningful vic-tories, it leaves only Kurdish fighters.

turkish troops would be another matter altogether. From the Us per-spective, getting turks to fight Is is good news—a major development in the slow process of assembling an effective coalition.

that’s why it makes sense for the Us to back the buffer zones, despite the risks. those risks are signifi-cant. the zone may be administered by syrian militias who have ties to anti-American jihadis. It might con-ceivably be the first step to the fall of Assad—at least that’s what the turks want. And it also might be another step toward the dismemberment of syria, which would further destabi-lize the region.

But a statelet where Is has been defeated, even if backed by turkey, will also be a counterpoint  to the militant group. And, at this point, the Us is begging for allies to take on Is. It can’t afford to be choosy.

Conclusion

CIRCULAR Letter (CL) 12-2007, dated July 25, 2007, was issued putting in place the Certificate of Cover Authentication Facility of the Philippine Insurers and

Reinsurers Association (Cocaf-Pira). the system currently being used by Pira. Formulated as an “interim” solution to the issues hounding the implementation of the Compulsory third- Party Liability (CtPL) insurance, all insurance companies were “enjoined” to have their Certificate of Cover (COC) authenticated through the COC Cocaf-Pira, starting July 25, 2007.

As envisioned, an “updated list of accredited insurers in good stand-ing shall be provided by the Insur-ance Commission (IC) to Cocaf for automatic checking of valid COCs, followed by an online data match-ing with the Land transportation Office (LtO) vehicle file. Under the interim arrangement, all COCs authenticated through the said fa-cility shall be verified through the COC Verification Facility (COCVF) of stradcom at the LtO during ve-hicle registration.” Cocaf-Pira was directed to submit monthly reports of authenticated and verified COCs, by insurance companies, to the com-mission within the first five days of each month. Another group of insur-ers, the Organization of Insurance Companies of the Philippines, had adopted a verification system out-side of the Cocaf-Pira.

Nonimplementation of the IC gatewayA MEMORANdUM of Agreement (MOA) dated January 20, 2010, entitled: “to establish intercon-nectivity/sharing of information relative to the Certificate of Cover for Compulsory third-Party Liabil-ity and Comprehensive Insurance through centralized monitoring and recording system to be known as the IC COC Gateway [ICG] and verification system to be known as the Enhanced Certificate of Cover Verification Facility [ECOCVF],” between the LtO, the Bureau of Internal Revenue (BIR) and the IC was signed.

Under the tripartite MOA, a) the “ICG shall serve as the sole electronic facility for recording all COCs as proof of coverage un-der the CtPL and Comprehensive Insurance for motor-vehicle reg-istrations. the system shall pro-vide interconnectivity/sharing of information among the parties and well-coordinated regulatory activities mandated of them”; and b) the “ECOCVF shall serve as the sole verification and tax-collection facility for all COCs as proof of cov-erage under CtPL and Comprehen-sive Insurance for motor-vehicle registrations. the facility shall provide interconnectivity/sharing of information among the parties and well-coordinated regulatory activities mandated of them.”

the ECOCVF is an integrated facility developed by the LtO “to include online and real-time verifi-cation of COCs, and ensure timely and effective collection of all taxes due to the BIR and other government institutions for CtPL and Compre-hensive Insurance.”

As agreed upon, the three agen-cies vowed to assume the follow-ing tasks: 1) “the IC shall require/mandate accredited insurance companies to submit/file COCs pertaining to CtPL and Compre-hensive Insurance policies into the ICG. For this purpose, the IC shall impose administrative sanctions upon insurance companies, their directors/officers/agents, for any willful failure or refusal to comply with or violation of the aforesaid re-quirement”; 2) “the LtO shall per-form, host, manage and maintain the ECOCVF for the subsequent verification of COCs and shall in-

terconnect with the ICG for proper monitoring of collection of taxes, fees and charges due to the BIR”; and 3) “the BIR shall have access to the ICG and ECOCVF to determine COC issuances and the amount of taxes due/paid to the government. the BIR shall also have access to the reports generated from the ICG and ECOCVF for purposes of industry analysis and tracking.”

Eventually, the ICG was formally proposed under CL 6-2010, dated February 12, 2010. Under this circu-lar, all COCs to be issued by insurance companies must pass through an ICG and that no COC shall be accepted without complying with the require-ments and procedures in CL 6-2010.

CL 19-2010, dated May 20, 2010, was issued, calling for the strict implementation of CL 6-2010. CL 26-2010, dated september 14, 2010, adopted a vehicle-classification sys-tem wherein the ICG system will not accept any “mismatched” vehicle type with the premium rate. the BIR, on the other hand, issued Revenue Memorandum Circular 7-2010, dated January 20, 2010, disseminating the MOA to all internal revenue officers.

Notwithstanding the laudable objective, the ICG never took off due to interconnectivity problems with the IC server. It was operationalized only for three months until it was eventually abandoned and forgotten.

Reportorial monitoringtHE authentication of COCs, how-ever, was mandated as early as 2002. Under CL 11-2002, dated July 4, 2002 (Authentication of Motor Ve-hicle COC), all insurance companies, agents and brokers were directed to submit to the process of authenti-cation of all COCs, failure of which to comply “shall be sufficient cause for disqualification of an insur-ance company to issue COC for the CtPL insurance.”

In addition to the authentication and verification measures, CL 11-2004, dated May 13, 2004, required the quarterly filing “on the monthly number of Motor Vehicle CtPL COCs issued under a prescribed format.” In addition, CL 16-2004, dated August 2, 2004 (Reporting of Certificate of Covers on Recapitulation 1 of the An-nual statement) required that non-life insurance companies will “report in the Annual statement, under Re-capitulation 1—Premiums Written and Premiums Earned, the number of COCs issued under CMVL-LtO and CMVL-NON-LtO. Consequent-ly, a separate column will be added in the said recapitulation as indicated in the form attached to the circular.”

Regulation of commissionsWItH respect to agency commis-sions, CL 10-2003 dated december 3, 2003, directed nonlife insur-ance companies “to adhere to the 10-percent commission rate for CtPL business as prescribed in the Insurance Code. Likewise, only 10 percent of the premiums therefore must be allocated for marketing ex-penses.” the circular was issued af-ter it was observed that nonlife in-surance companies were “offering excessive commissions and other allowances to agents and brokers for the sole purpose of obtaining the business.”

Understanding the Compulsory Third-Party Liability insurance

By Dhiraj Nayyar Bloomberg View

INdIA’s Ministry of Finance and its central bank are on a collision course  once more. A new Indian

Financial Code, a  draft  of which was put up on the ministry’s web site last week, proposes radical changes to the way the Reserve Bank of India (RBI) decides on monetary policy. At the moment, RBI Governor Raghuram Ra-jan has sole responsibility for deciding what India’s interest rate ought to be. the new code proposes to hand over the task instead to a seven-member mon-etary policy committee, four of whose members will be chosen by the govern-ment. Only three members—including the governor, who will have no power to veto decisions—will represent the central bank.

this is the second major change to the central bank’s functioning that Prime Minister Narendra Modi’s government has proposed this year. In February Finance Minister Arun Jaitley  sug-gested that the task of managing the

government’s debt would be shifted from the RBI to an independent debt-management agency. Jaitley  with-drew  that proposal in May, probably under pressure from an RBI unhappy with a clipping of its wings. the gov-ernment seems to be making a tactical retreat from its new proposal, as well. Jaitley’s deputy quickly clarified that the draft code had been drawn up for policy-makers to debate only. However, it would be unwise for the government to surrender to the RBI and critics who claim the new proposals will rob India’s central bank of its independence.

the argument that the proposed committee will be beholden to the gov-ernment is flawed for several reasons. For one, it conflates central-bank au-tonomy with absolute decision-making powers for its governor. the RBI’s au-tonomy is institutional and doesn’t de-pend on the status of its chief. In any case, the central bank’s governor, its deputy governor for monetary policy and its entire board—one of whom will join the governor and deputy governor as RBI “representatives” on the new

committee—are also appointed by the government. In theory, politicians could even now appoint suitably malleable persons to these positions in hopes of dominating monetary policy-making.

that these figures usually assert their independence is solely because they have institutional protection. As long as the committee’s structure, func-tioning, responsibility and accountabil-ity are set in no uncertain terms—the minutes of all meetings should be public, as well as the details of how each mem-ber voted —its members (presumably experts) should have incentive enough not to act as government shills.

Remember, most modern central banks, whether in the Us or the UK, rely on a group of individuals to decide on interest rates. One person, no matter how brilliant and independent, could make a wrong decision. And in India, recent  central bank chiefs have been behind the curve in raising or lowering interest rates.  

the fears of encroachment on the RBI’s independence also fail to  take into account recent developments in

monetary policy in India. In March, for the first time, the government set an explicit inflation target for the RBI. Before then, the central bank had pursued multiple  goals—managing inflation, growth and exchange-rate stability. though theoretically free to pursue those goals as it wished, in real-ity, it had to consult the government. Now, its goal is clear. Once that target is set, the monetary policy committee will have to strive to meet it—regard-less of any pressure from the politicians.

the RBI governor would still retain enormous influence as a member (and likely chairman) of the new committee and would be free to use his powers of persuasion to sway others. In any case, other bank functions, such as regulat-ing India’s banking system and manag-ing the government’s debt, will remain with the governor. With time, modern best practices would dictate changes to those roles, too. For now, the govern-ment shouldn’t allow the central bank to confuse what is essentially a turf battle with a false narrative about the loss of its independence. 

Don’t fret for India’s central bank

Atty. Dennis B. Funa

INSURANCE FORUMBLOOMBERG

Noah Feldman

private owner is providing. That is why we exercised political will to add new train cars ourselves. Not only did MRTH fail to add them, they even filed a case to stop us when we did,” he said. MRTH sued the Department of Transportation and Communica-tions (DOTC) in 2014 for procur-ing the new train cars despite the disproval of the line’s owner. Sobre-pena, back then, said only the private owners have the right to purchase new coaches.  A Makati City court then issued a stay order against the procurement deal, but subsequently decided to favor the transportation department as only the Supreme Court may enjoin such a project. Sobrepeña then elevated his case to the Court of Appeals, which denied the petition. MRTH sought for a reconsideration of the appellate court’s decision, hence the pending case.  “MRTH’s case against the DOTC is a case against new trains. It is a case against the public. So we are fight-

ing this case for the public interest,” Abaya said.  The transport chief’s statement came a day after President Aquino blamed the MRTC for the worsen-ing state of the MRT. In his last State of the Nation Ad-dress, the President said the public should blame the private company for its failure to properly maintain the train line despite its mandate. “They remembered their rights, but not their obligations. Instead of them doing their jobs, we are the ones left to do their work,” President Aquino said on Monday.  Under the build-lease-transfer agreement signed by the government and the MRTC, the latter is mandat-ed to construct and maintain Edsa’s main train line. The government, on the other hand, shall operate and lease the system.  President Aquino said the private partner for the MRT deal has proven negligent of its duty and has forced the government to take over the maintenance and the overhauling of the railway line.  “When we started to improve the

line, they interrupted, saying that they can do the work. We did not al-low it to happen and, instead, we ini-tiated projects to improve the MRT. We procured train cars, but they held it back through a court TRO,” said President Aquino, referring to a temporary restraining order.  In the end, the government won the train-car procurement battle. The 48 new train cars will be delivered in tranches starting the first quarter next year.  But, for railway expert Rene S. Santiago, Mr. Aquino’s statements were typical. “These are typical state-ments from somebody who wants to put the blame on another,” he said. “This is just another blame game.” For Santiago, the public only has the DOTC to blame.  “The problem has been there from the time that the MRT was built. The MRTC is responsible, under the build-lease-transfer agreement, to operate and supply the trains for the next 25 years. It also includes the maintenance,” he explained. “But the DOTC took that right to maintain from the MRTC,

which, in effect, provides for the cessation of the MRT’s responsi-bility to make available 22 trains during the peak hour.” He claimed the MRTC was able to properly maintain the line, when it subcontracted Sumitomo Corp. for the upkeep of the railway system. “But the government meddled with the maintenance. The trains declined from 22 to 15, and sometimes eight. It predict that by next year, there will be less than 10 cars available for opera-tions,” Santiago said.  This, despite the scheduled de-livery of the new train cars from Chinese train manufacturer Dalian Locomotive.  “All these things they have been telling us will not solve the problem of the MRT. They also have to resolve the problems in tracks, in the trains, the signaling, the power system and the communications system,” San-tiago said. The procurement of new train cars, he said, will be put to waste if the old coaches are not rehabilitated. “They will just be replacements of the old train cars,” Santiago said. 

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MRT Holdings told to drop case vs govt

AYALA LAND PREMIER:WEST GALLERY PLACESOLD OUT IN 2 YEARS

“There was no semblance of regulation and proper disclosure before [this resolution]. Kaming mga legitimate developers and brokers, we are accountable on whatever we print, and we agree that that should apply to everyone,” Cariño added.   Board Resolution 921 earned the ire of the UPMG, which said the regulation “betrays an intoler-ant view of business and should be

rescinded immediately.”   Moreover, the group said prop-erty developers have seen a decline in sales, an observation countered by Creba.  “It has no chilling ef-fect. In fact, it will legitimize the trustworthy operators, and hindi na matatakot bumili ang buying pub-lic,” Cariño said.   The Creba official assured that the policy will not affect the

production target of at least 500,000 units a year to address the 5.5 million housing backlog in the country in 10 years.    Board Resolution 921 is es-sentially the amended imple-menting rules and regulations of  Presidential Decree 957, or the Subdivision and Condomin-ium Buyers’ Protective Decree, covering advertisements

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By VG Cabuag

AyAlA land Premier (AlP), the luxury brand of developer Ay-ala land Inc., on Tuesday said

it expects to sell the entire 49-story West Gallery Place in Bonifacio Global City in Taguig within two years, as de-mand for this type of development is still high. Jose Juan Jugo, AlP managing director, said that, despite the price increase, demand is still very strong for West Gallery units, mostly from |local buyers. “AlP is renowned for notable prod-ucts, such as the Roxas Triangle Towers on Cruzada Street, Makati City, and The Suites in One Bonifacio High Street. We bring that same quality and distinction to these properties in High Street South,” Jugo said. For the West Gallery, the company is trying to sell a total of P11.5 billion for the entire tower. It is a sibling of East Gallery Place, which is now 84-percent sold, translating to about P9.3 billion in sales. West Gallery, which has units priced at P13 million and above, is expected to perform just as well, Jugo said, adding that some 48 units

have been sold in just the past month, valued at P1.6 billion. On the average, the develop-ment is being priced at P234,000 per square meter. The tower, near the High Street South block in the former military camp in Taguig, features 420 units, with sizes ranging from 52 square me-ters for a classic one-bedroom unit to the 701-sq-m units called Villas, which will have a private elevator. The Skyrise 49, a special unit on the top most floor, is an 832-sq-m unit with 4-meter-high ceilings in the |living and dining areas, a pool and an outdoor deck. It will cost about P234 million. Aside from its prime location, the West Gallery Place is surrounded by greenery on three sides. Gallery Park is on its southern and eastern sections, with an unobstructed view of Terra 28th to be enjoyed from the western side. The Gallery Park separates the East and West residential towers. West Gallery boasts of eight residen-tial formats: Classic units in the South Wing, four-level and two-level villas, the Skyrise, Skycove units, Park View units, Courtyard and three-bedroom corner and two-bedroom flats.

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  The culture of ride sharing, or carpooling, is common in many parts of the world, mostly in the West. But, in the Philippines, the concept is relatively new. Save moneyTHE concept of carpooling is one of the reasons Ronald Santos, an owner of a two-year-old sedan, is seriously looking into registering his vehicle with a TNC. “I’m considering the prospect, since I am always on the road,” said Santos, a food technician who lives in Marikina City. With his work based in Bonifacio Global City in Taguig, the 27-year-old professional usually shells out at least P300 for his daily ride.  “Traffic is really bad, and the cost of maintaining the car, plus burning gas for no reason at all due to the congestion, is not friendly to my pocket,” Santos said.  Hence, by becoming a partner-driver at either one of the TNCs, he could offset the cost and use the money that he saved for his leisure.  “Maybe I could buy a new bad-minton racket with the money that I could save. It will be of great help. Still, I will look into that prospect and weigh my chances,” Santos said.  For Diane Reyes, who got tired of her four-hour commute to Makati City from Novaliches in Quezon City and vice-versa, ride-sharing apps have been very helpful to her and her peers.  “My friends usually share the ride. The Uber driver does not com-plain if we drop off people in Cubao,

in North Edsa and other places. One time, we even ask the driver to take us to a friend’s place just to pick her up, it was kind of out of the way, but he did not complain,” said Reyes, a multimedia specialist.  Although it is her debit card that is registered with Uber, her friends chip in to pay for the fare.  “It has dual benefit: I saved money, and I could relax,” she said.  Reyes now lives in an apartment space near Washington Street in Makati, but she confessed that she is still an Uber fan.  “I still use Uber, especially when I’m rushing for a meeting. You pay exactly the same with the metered taxi, and sometimes it’s even lower than the taxi rates,” she said. Maximize your assetUBER Manila General Manager Lawrence Cua said these devel-opments show that Filipinos are now open to the concept of ride sharing.  “People are starting to share an Uber ride. It’s heartwarming when drivers tell us that people are now open to the idea of ride sharing,” he said. Land Transpor-tation Franchising and Regulatory Board Chairman Winston M. Ginez explained that these are forms of asset maximization that the TNCs have carried with them when they entered Manila.  “Ride sharing is all about asset maximization. People have seen how efficient this concept is, and we encourage people to use them,” Ginez said.  Cua agreed that sharing an Uber

ride, or being an Uber driver, could turn costs into savings.  “We are now seeing less and less people using their private ve-hicles. Parking is costly in Maka-ti—that alone is already a burden to private-car owners. With Uber people now have this option not to drive and spend P5,000 for the parking alone. Add to that the cost for gas. People could generate sav-ings out of this app,” he said. Increased productionNOT only do these TNCs help save costs to the consumers, it also helps commuters be more productive. GrabCar Acting General Man-ager Natasha Bautista said private- vehicle owners now have the luxury of working behind the car, instead of being behind the wheel. “I don’t want to be stuck in traf-fic while driving and wasted an hour for it. What I could do is to get a ride via GrabTaxi or GrabCar and I can work at the back seat,” she said. The Japan International Coop-eration Agency (Jica) has predicted that the Philippines stands to incur P6 billion in productivity losses due to the traffic congestion starting 2030. This is on a daily basis. Currently, Manila is losing P2 billion a day due to the transport-infrastructure backlog. Partially free up EdsaCOMPANIES such as Uber and GrabCar also help in opening up por-tions of congested roads, especially when people start to share the ride.

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