Philippines blocks crypto giant Binance
Other Relevant Tax Updates:
- TAX & BUSINESS-RELATED NEWS [MARCH 22-26]
- DOJ OPINION ON THE BIR’S WARRANT OF DISTRAINT/LEVY INVOLVING THE 16TH FLOOR OF SEC HEADQUARTER
- SEC LEGAL OPINIONS ON FOREIGNER AS CHAIRMAN OF THE BOARD OF A PARTLY NATIONALIZED ENTITY & MERGER WITH A FOREIGN ENTITY
- CTA CASES ON CONTINUANCE OF BIR AUDIT & BIR SUBPOENA
- SUPREME COURT CASE
I. TAX & BUSINESS-RELATED NEWS [MARCH 22-26]
1. BSP revokes license of crypto service provider
2. CDC remits ₱1.8-B cash dividends to national treasury
3. OFWs get 50 percent discount on NAIA bus
4. Vietnamese firm eyes PH ride-hailing market
5. Ty-blings’ Metrobank retains crown as Best Private Bank for ultra rich Pinoys
6. House lawmaker wants tax breaks to encourage animal adoption
7. Kathryn Bernardo becomes first PH ambassador of French luxury beauty brand
8. Napoles cleared in tax charges
9. Boracay nearly 100 pct full, says foundation
10. Recto: No new taxes until end of Marcos term
11. Philippines blocks crypto giant Binance
12. Gov’t mulls over PPP route for wind projects near seaports
13. Villanueva: Work-from-home law can ease Metro Manila traffic woes
14. Marcos admin to borrow P585B from local creditors in Q2
15. DMCI Homes sets P 16-B kitty for new builds
16. Recto wants to prolong existence of PSALM to plug deficit
17. Sun Life support unit ramps up hiring in PH
18. BoI welcomes copper mining project
19. New Pangasinan expressway seen to boost economy, tourism
II. DOJ OPINION
WHETHER THE 16TH FLOOR OF SEC HEADQUARTERS, FORMERLY UCPB BUILDING, CAN BE THE SUBJECT
OF BIR WARRANT/LEVY
The Bureau of Treasury (BTr) is requesting an opinion on whether the 16th Floor of the SEC Headquarters, previously
known as the UCPB Building, can be subject to warrant, levy, or auction sale by any taxing authority. The property,
owned by L Co., a part of the Coconut Industry Investment Fund-Oil Mills Group, was adjudged by the Supreme Court
as belonging to the National Government, making it a non-cash coconut levy asset. This asset falls under the Republic
Act (R.A.) No. 11524, otherwise known as the “Coconut Farmers and Industry Trust Fund Act” and is required to be
disposed of by the Trust Fund Management Committee (TFMC), with proceeds going to the Coco Levy Trust Fund.
Despite its status as a public domain property for the benefit of Filipino coconut farmers and the coconut industry, the
BIR issued a Warrant of Levy against the property due to alleged tax deficiencies by L Co. This action is contested
through a pending Petition for Adjudication of Dispute. The BTr seeks confirmation that TFMC has sole authority over
the disposition of non-cash Coco Levy Assets, that the 16th Floor is such an asset, and that the BIR’s levy would
unreasonably divert funds authorized by R.A. No. 11524. However, the DOJ declines to provide a confirmatory opinion,
citing the ongoing dispute adjudication process under Presidential Decree (P.D.) No. 242, which vests the Secretary of
Justice with authority to resolve disputes between government agencies and entities. The DOJ believes that allowing
the dispute panel to reach a decision or parties to settle amicably is preferable to pre-empting their actions with an
opinion. [DEPARTMENT OF JUSTICE LEGAL OPINION NO. 11, SERIES OF 2024, FEBRUARY 20, 2024]
III. SEC LEGAL OPINIONS
PARTLY NATIONALIZED CORPORATION CAN NOT ELECT A FOREIGN INVESTOR AS CHAIRMAN OF THE
BOARD
M Co. is seeking an opinion on whether C Shipping, Inc. can permit a foreign investor to be elected as its Chairman of
the Board. Also, it is seeking clarification on the extent of participation allowed for a foreign investor serving as a Board
member, specifically in the exercise of and protection of its interests in the Company. In reply, the Commission referred
to the Commonwealth Act No. 108, or the “Anti-Dummy Law.” C Shipping, Inc., as a private recruitment and manning
agency, shall comply with the foreign equity restrictions under the Constitution and the 12th Foreign Investment
Negative List (12th FINL). These provide that the company adheres to a 25% foreign equity restriction in its
shareholdings, limiting foreign investor participation on the Board of Directors. Consequently, the Company cannot
appoint any foreign individual to intervene in its management, operation, administration, or control. In activities partly
nationalized, foreign nationals may sit on the board in proportion to their allowable membership citing SEC Opinion No.
07-07. In the same vein, an alien national may assume the post of the Chairman of the Board whose act shall be limited
to that of a Presiding Officer during board meetings. On the extent of participation allowed for a foreign investor serving
as a Board Member, the authority to manage a corporation is typically vested in the Board. Board members, whether
foreign or not, are allowed to exercise corporate powers granted under the Revised Corporation Code (RCC) through
their membership. [SEC OFFICE OF THE GENERAL COUNSEL LEGAL OPINION NO. 23-16, NOVEMBER 24, 2023]
FOREIGN CORPORATION LICENSED TO DO BUSINESS IN THE PHILIPPINES MAY MERGE WITH A DOMESTIC CORPORATION
M Global Shared Services, Inc. (“M Global”) is seeking an opinion on whether its planned merger with M Tribe Commercial BM Ltd. (“M Tribe”), a foreign company based in Bermuda, is allowed under Philippine Law. In reply, the Commission referred to Section 104B of the Bermuda Companies Act which allows the merger of a company registered under the laws of Bermuda with a Corporation registered in a foreign jurisdiction with the latter entity as the surviving company. Citing Section 75 of the Revised Corporation Code (RCC), two (2) or more corporations may merge into a single corporation which shall be one of the constituent corporations. Additionally, Section 149 of the RCC provides that foreign corporations authorized to transact business in the Philippines may merge or consolidate with any domestic corporation if permitted under Philippine laws and by incorporation laws. Provided, however, that if the absorbed corporation is a foreign corporation doing business in the Philippines, the latter shall at the same time file a Petition for Withdrawal of its License. In relation thereto, Section 153 of the RCC provides the requirements for the Petition for Withdrawal of the License of foreign corporations, as follows: (1) all claims that have accrued in the Philippines which have been paid, compromised, or settled; (2) all taxes, imposts, assessments, and penalties, if any, lawfully due to the Philippine Government or any of its agencies or political subdivisions, have been paid, and (3) the Petition for Withdrawal of License has been published once a week for three (3) consecutive weeks in a newspaper of general circulation in the Philippines. [SEC OFFICE OF THE GENERAL COUNSEL LEGAL OPINION NO. 23-15, OCTOBER 19, 2023]
IV. CTA CASES
[ISSUANCE OF NEW LOA FOR THE CONTINUANCE OF AUDIT DOES NOT INVALIDATE PRIOR AUDIT]
[NECESSITY OF A DEFINITE DUE DATE IN TAX ASSESSMENT NOTICES FOR THEM TO BE CONSIDERED
VALID]
The Petitioner IBMS Technology Phils. Corporation filed a Petition for Review praying that the 2015 tax assessments
issued by the Respondent Commissioner of Internal Revenue (CIR) be cancelled and withdrawn. The Petitioner argued
that the original Letter of Authority (LOA) was void due to a subsequent LOA and claimed that the period of limitation
for assessment and collection has already prescribed. On the other hand, the Respondent countered, asserting the
validity of the original LOA, disputing the expiration of assessment time limits, and placing the burden of proof on the
Petitioner to challenge the assessment’s validity. In ruling, the Court held that the issuance of a new LOA to continue
the audit process did not invalidate the prior audit. The Court emphasized that the new LOA served as a replacement
for the original LOA and authorized the examination of the Petitioner’s books of accounts. The Court upheld the validity
of the audit process despite the issuance of a new LOA. Regarding the prescription of the assessment and collection
period, the Court recognized the partial set-in of prescription. However, the Court highlighted the importance of a
definite due date in tax assessment notices. Since the Final Assessment Notice (FAN) lacked a clear due date for
payment, the assessment is invalid and ineffectual. Since the subject assessment is void, the Petitioner cannot likewise
be held liable to the Compromise Penalty. Hence, the Petition was GRANTED, and the tax assessment
was CANCELLED. [IBMS TECHNOLOGY PHILIPPINENCELLED. [IBMS TECHNOLOGY PHILIPPINES CORPORATION VS. COMMISSIONER OF INTERNAL REVENUE, CTA CASE NO. 10177, MARCH 15, 2024
CONSEQUENCES OF FAILING TO OBEY SUMMONS & PRODUCE REQUIRED DOCUMENTS AS MANDATED
BY THE BIR
Petitioners Jimmy A. Ang and Olivia N. Ang, officers of The Value Systems Philippines, Inc., filed a Petition for Review
to reverse their conviction for the violation of Section 266 of the 1997 Tax Code, as amended, for failure to comply with
a Subpoena Duces Tecum (SDT) issued by the BIR. The Petitioners contended that the SDT was void and without
effect because it was issued over a year before the issuance of the SDT. They also argued that the SDT was irregularly
served on them and that they never neglected the SDT. On the other hand, the Respondent People of the Philippines
countered that the Petitioners’ insistent attack on the alleged irregularities in the SDT’s service was unfounded. The
Petitioners’ receipt of the SDT was admitted by Jimmy Ang himself. In ruling, the court found that the Petitioners were
duly summoned and that there was no error in the actions of the lower courts in this regard. The Petitioners had been
properly notified through their representative, Raquel Encinas, who received the SDT and other notices on their behalf.
It was established that the SDT was served in accordance with the relevant procedures and that the Petitioners had
knowledge of its contents. The Court emphasized that the Petitioners willfully neglected to appear and produce the
required documents before the BIR, despite the extension of time given. Consequently, the Petition was DENIED. The
Court AFFIRMED the conviction of the Petitioners for violation of Section 266 of the 1997 Tax Code and upheld the
penalties imposed on the Petitioners for their non-compliance with the SDT, i.e. one (1) year imprisonment and a fine
imposed on both the Petitioners in the amount of ₱5,000.00. However, the Court WITHDREW and SET ASIDE the
₱50,000.00 penalty imposed on The Value Systems Philippines, Inc. [JIMMY A. ANG & OLIVIA N. ANG VS. PEOPLE
OF THE PHILIPPINES, CTA EN BANC CRIMINAL CASE NO. 096, FEBRUARY 22, 2024]
V. SUPREME COURT CASE
PRESENCE OF SUFFICIENT REASON TO RELAX THE RULE ON EXHAUSTION OF ADMINISTRATIVE
REMEDIES
The Petitioner Oceanagold (Philippines), Inc. filed a Petition for Review on Certiorari assailing the CTA En Banc’s
earlier Decision and Resolution denying its Petition due to lack of jurisdiction. The Petitioner’s main contention is against
the seizure and detention of its copper concentrates by the BIR and the validity of Revenue Memorandum Circular
(RMC) No. 17-2013. As a backgrounder, the Petitioner inherited rights under a Financial or Technical Assistance
Agreement for mining activities. It sought confirmation of tax exemption for minerals from the Commissioner of Internal
Revenue (CIR), which was initially granted but later revoked. The BIR detained the Petitioner’s copper concentrates
several times, alleging non-payment of excise tax, leading to legal challenges by the Petitioner. The Petitioner argued
that the CTA erred in denying jurisdiction. In ruling, the Court found merit in the Petitioner’s argument regarding the
CTA’s jurisdiction over challenges to tax laws or regulations. However, it stressed the need to exhaust administrative
remedies, which the Petitioner failed to do in some instances. The Court acknowledged exceptions to this rule, such
as violation of due process or urgency of judicial intervention, which might apply to the Petitioner’s case. Consequently,
the Petition was PARTLY GRANTED. The Court set aside the CTA’s Decision and remanded the case back to the
CTA for further proceedings, directing it to consider the merits of the case. [OCEANAGOLD (PHILIPPINES), INC. VS.
COMMISSIONER OF INTERNAL REVENUE, G.R. NO. 234614, JUNE 14, 2023, UPLOADED NOVEMBER 19, 2023]
BSP revokes license of crypto service provider [The Philippine Star, March 26, 2024]
The Bangko Sentral ng Pilipinas (BSP) has revoked the license of Atomtrans Tech Corp., a virtual asset service provider
(VASP) in the Philippines.
https://www.philstar.com/business/2024/03/26/2343259/bsp-revokes-license-crypto-service-provider
CDC remits ₱1.8-B cash dividends to national treasury [Inquirer.Net, March 26, 2024]
The cash dividends for 2023 surpassed the ₱1.207 billion covering the dividend year 2022 by 49 percent
https://business.inquirer.net/451962/cdc-remits-%E2%82%B11-8b-cash-dividends-to-national-treasury
OFWs get 50 percent discount on NAIA bus [ABS-CBN News, March 26, 2024]
Transport company UBE Express is offering a 50 percent discount for overseas Filipino workers (OFW) for trips going
to or coming from the Ninoy Aquino International Airport.
https://news.abs-cbn.com/business/2024/3/26/ofws-get-50-percent-discount-on-naia-bus-1437
Vietnamese firm eyes PH ride-hailing market [Inquirer Mobile, March 26, 2024]
A unit of Vingroup, one of the largest private conglomerates in Vietnam, has expressed interest in entering the
Philippines’ ride-hailing market this year with a plan to provide eco-friendly taxi services that only utilize electric cars.
Ty-blings’ Metrobank retains crown as Best Private Bank for ultra rich Pinoys [Bilyonaryo, March 26, 2024]
Metropolitan Bank and Trust Co., led by the Ty family, maintains its reign as the preferred bank for affluent Filipinos
after winning the Best Bank for Ultra High-Net-Worth (UHNW) award at the prestigious Euromoney Global Private
Banking Awards 2024.
House lawmaker wants tax breaks to encourage animal adoption [ABS-CBN News, March 26, 2024]
Under his bill, the adoption of impounded and stray animals will entitle adopters to lower real property tax
https://news.abs-cbn.com/news/2024/3/26/house-lawmaker-wants-tax-breaks-for-animal-adoption-1215
Kathryn Bernardo becomes first PH ambassador of French luxury beauty brand [Inquirer.Net, March 26, 2024]
Kathryn Bernardo seems to be collecting not just local but also international endorsements, as she was announced as
the first ever Filipino celebrity to become the ambassador of a French luxury beauty brand in the country
Napoles cleared in tax charges [Philippine Daily Inquirer, March 25, 2024]
The prosecution said that Napoles declared zero reported net income in 2006, 2009, 2010, 2011, and 2012 while
alleging that she “amassed” real properties and insurance investment policies and had infused capital in different
corporations.
https://newsinfo.inquirer.net/1922555/napoles-cleared-in-tax-charges
Boracay nearly 100 pct full, says foundation [ABS-CBN News, March 25, 2024]
“Hindi pa 100% puno pero it’s getting there. Meron pang makukuhang room,” Neneth Graf, Boracay Foundation board
member, said in a TeleRadyo Serbisyo interview.
https://news.abs-cbn.com/news/2024/3/25/boracay-nearly-100-pct-full-says-foundation-820
Recto: No new taxes until end of Marcos term [Inquirer Mobile, March 25, 2024]
Speaking to reporters on the sidelines of the induction ceremony for new officers of the Economic Journalists
Association of the Philippines (Ejap) last week, Recto said the fiscal situation was “not that bad” for the government to
slap new taxes.
Philippines blocks crypto giant Binance [ABS-CBN News, March 25, 2024]
On its website, Binance describes itself as the world’s biggest crypto trading platform, with about 169 million users
trading over 350 cryptocurrencies.
https://news.abs-cbn.com/business/2024/3/25/philippines-blocks-crypto-giant-binance-1641
Gov’t mulls over PPP route for wind projects near seaports [Inquirer Mobile, March 25, 2024]
The government may seek the help of the private sector in building offshore wind projects near seaports given the
substantial funding requirement, according to an official of the Department of Transportation (DOTr).
Villanueva: Work-from-home law can ease Metro Manila traffic woes [ABS-CBN News, March 25, 2024]
“Companies and employees should be allowed to arrange for flexible work arrangements instead of having employees
report physically in the office every day and losing working hours due to traffic,” Villanueva said.
https://news.abs-cbn.com/news/2024/3/25/senators-offer-solutions-to-metro-manila-traffic-woes-1504
Marcos admin to borrow P585B from local creditors in Q2 [Philippine Daily Inquirer, March 25, 2024]
Based on the schedule posted on the Bureau of the Treasury ‘s (BTr) website on Monday, the government is targeting
to raise P195 billion through sale of Treasury bills (T-bills) and P390 billion via Treasury bonds (T-bonds).
https://business.inquirer.net/451868/marcos-admin-to-borrow-p585b-from-local-creditors-in-q2
DMCI Homes sets P 16-B kitty for new builds [Inquirer Mobile, March 25, 2024]
DMCI Homes last week launched the 55-story The Valeron Tower, a joint venture with Japanese conglomerate
Marubeni Corp. set to rise along C-5 (Circumferential Road 5) and within the thriving Ortigas Center in Pasig City.
Recto wants to prolong existence of PSALM to plug deficit [Inquirer Mobile, March 25, 2024]
Finance Secretary Ralph Recto said the corporate life of state-owned Power Sector Assets and Liabilities Management
Corp. (PSALM) should be extended “by another 25 years, possibly” since it still has a lot of assets for sale and financial
obligations to settle.
Sun Life support unit ramps up hiring in PH [Inquirer Mobile, March 25, 2024]
Bernardo said their Global Capability Center in the Philippines provides actuarial, under writing and legal services,
among others, for the Sun Life group’s insurance business.
BoI welcomes copper mining project [The Manila Times, March 25, 2024]
In a statement over the weekend, Trade Secretary and BoI Chairman Alfredo Pascual lauded the granting of a mining
permit to Celsius Resources’ Philippine subsidiary, Makilala Mining Co. Inc. (MMCI) for its flagship Maalinao-CaigutanBiyog (MCB) mining project.
New Pangasinan expressway seen to boost economy, tourism [Philippine Daily Inquirer, March 22, 2024]
The P34.34-billion first phase of the project runs for 42.67 km and is divided into three segments. These include the
6.9-km Binalonan-Manaoag section, 11.3-km Manaoag-Calasiao junction, and the 22.17-km Calasiao-Lingayen
segment. A 2.39-km spur road will also be paved in Calasiao
https://newsinfo.inquirer.net/1921619/new-pangasinan-expressway-seen-to-boost-economy-tourism
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