DOF orders compliance with Bayanihan 2 debt, payment relief measures

Finance Secretary Carlos Dominguez III has ordered stakeholders to conform to the various relief measures under the Bayanihan to Recover as One Law (Bayanihan 2), which consumers would enjoy until year-end.

Dominguez on Dec. 4 signed Department of Finance (DOF) circulars serving as the implementing rules and regulations of Bayanihan 2’s provisions on the grace periods extended to utility and loan payments and the use of the municipal development fund (MDF) balances for COVID-19 response.

Dominguez on Oct. 23 also issued Department Circular No. 3-2020, extending the deadline of taxes and other local government units’ (LGUs) revenue sources to Dec. 19 for all dues needed to be paid on or after Sept. 14, or when Bayanihan 2 Law took effect.

With regard to the new issuances, Department Circular 4-2020 ordered all electric, water, telecommunications and other utility companies to defer payment collection for 30 days in areas placed under the more stringent enhanced community quarantine (ECQ) or modified enhanced community quarantine (MECQ).

“In the case of electric power sector, the minimum 30-day grace period and staggered payment without interests, penalties and other charges shall apply to all payments due within the period of the ECQ and MECQ in the entire electric power value chain, which includes generation companies, transmission companies and distribution companies,” Dominguez said.

Dominguez said utility firms should not force their customers to waive the availment of relief during the grace period, albeit voluntary payments during the ECQ or MECQ period could be accepted.

“Unpaid residential, MSME (micro, small and medium enterprises) and cooperatives’ utility bills may be settled on a staggered basis, payable in not less than three monthly installments after the grace period, subject to the procedural requirements of the concerned regulatory agencies,” Dominguez said, adding utility service providers could also offer other “less onerous” payment terms subject to their regulators’ approval.

Department Circular 5-2020, meanwhile, provided that the 60-day loan moratorium under Bayanihan 2 covered dues payable on or before Dec. 31, including those extended by banks, quasi-banks, financing and lending companies, real estate developers, life insurers, preneed firms, entities providing in-house financing for goods and properties purchased, asset and liabilities management companies, as well as other regulated credit-granting public and private financial institutions.

Dominguez said the mandatory, nonextendible and one-time 60-day grace period would cover all existing, current and outstanding loans—including their principal and/or interest, plus amortization, falling due between Sept. 15 and Dec. 31, in effect also extending the loan maturity period.

The grace period covered individuals and entities’ multiple loans, with the moratorium applying to each individual loan.

Specific loans covered by the 60-day grace period included salary, personal, housing, commercial and motor vehicle loans, amortizations and payments for credit cards, financial leases and premiums.

However, interbank loans and bank borrowings were not covered by the moratorium.

Financial institutions may also extend a longer grace period. Borrowers, however, may still pay their obligations once due.

During the 60-day period, loans should not be slapped interest, penalties, fees and other charges for borrowers’ late payment or nonpayment. INQ