Philippine business must watch for new laws
Business leaders must keep themselves abreast of recent developments that affect their businesses or operations.
To stay ahead of the curve, it is imperative to gain a clear understanding of the implications of recently enacted laws and quickly plan how to integrate these factors into the future plans of the organization.
Of the laws recently signed by the President, the list below will be relevant to most businesses.
Tax Amnesty Act (Republic Act No. 11213): This offers businesses with long overdue tax liabilities a clean state—the first-ever amnesty on delinquencies in the country.
The tax amnesty would allow businesses with delinquencies to pay only at least 40 percent of the tax assessed.
National Payment Systems Act (Republic Act No. 11127): Payment system providers—which may include banks, credit card companies and online payment platforms—now have to seek prior authority to operate from the Bangko Sentral ng Pilipinas (BSP).
This is expected to pave the way for the adoption of electronic receipts, invoices, digital signatures, as well as boost digital payments in the government and the private sector.
Telecommuting Act (Republic Act No. 11165): While it remains voluntary for employers to offer telecommuting as a work option, it will not be surprising for employees to work for the adoption of this practice, as it will address the long hours spent in travelling between home and work.
Employers, however, must consider that they still have to pay full benefits and possibly even shoulder or subsidize the telecommunications cost of their employees.
Companies have to provide access to company information and opportunities for their employees to meet with coworkers regularly.
The implementing rules and regulations from the Department of Labor and Employment provides a list of the contents of an employer’s telecommuting policy or agreement.
Social Security Act of 2018 (Republic Act No. 11199): This mandates an increase in monthly contributions from 2019 to 2025, with varying rates every year.
105-Day Expanded Maternity Leave Law (Republic Act No. 11210): This requires both the government and the private sector to give mothers 105 days of paid maternity leave.
With employers having to provide full pay during the maternity leave and even grant additional days depending on the circumstances, the cost of ensuring business continuity and possibly hiring temporary staff becomes steep.
New Central Bank Act (Republic Act No. 11211): Amending the charter of the BSP and increasing its capitalization, the law widens the BSP’s industry coverage to include money service businesses, credit granting businesses, as well as payment system operators.
It also gives the BSP additional power to slap administrative and criminal sanctions, as well as increased fines on erring financial services institutions, from a ceiling of P30,000 a day for every violation to P1 million “for each transactional violation.”
Revised Corporation Code of the Philippines (Republic Act No. 11232): As part of government efforts to ease the way of doing business in the country, the 38-year-old Corporate Code now permits forming one-person corporations or companies with only one stockholder instead of a minimum of five, making it easier for entrepreneurs to establish their own businesses.
It also allows a perpetual corporate term for existing and future corporations, unless specified in the company’s articles of incorporation.
The new code also encourages using technology for corporate filing, stockholder meetings and board meetings, making it easier to administratively comply with the requirements of the Securities and Exchange Commission.
Energy Efficiency and Conservation Act (Republic Act No. 11285): Energy efficiency and conservation is no longer a best practice or nice to have, but a must for businesses, especially for automotive and real estate industry players.
The new law paves the way for the employment of certified energy conservation officers, certified energy managers, energy service companies and energy labels.
This is welcome news for companies whose products or services seek to provide energy efficiency to end users.
Some of these laws are now being implemented, while others still await more specific implementing guidelines.
Either way, companies that are able to quickly adapt to these new rules, minimize negative impact on operations or use them as strategic differentiators will best come out ahead in a fast-changing business environment.
The first step for any business leader is to start the conversation within their organization and encourage an in-depth analysis of what the new laws mean to business.
This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines, or MAP. The author is the chair and CEO of P&A Grant Thornton and member of the MAP Trade, Investments and Tourism Committee. Feedback at <[email protected]> and <[email protected]>. For previous articles, please visit .
