Suspension of Payments of Individual Debtors: Options for Debtors in Distress

Individual debtors under financial distress may be covered by any of the following options: (a) Suspension of payments; (b) Voluntary liquidation; and (c) Involuntary liquidation. This discussion covers only suspension of payments under Republic Act No. 10142, also known as the “Financial Rehabilitation and Insolvency Act (FRIA) of 2010“, as fleshed out in the FLSP Rules. Moreover, the discussion below on Suspension of Payments applies only to individual debtors.

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PUM and PUI No More: Shift of Classifications to Suspect Case, Probable Case, and Confirmed COVID-19 Case

The Department of Health (DOH) ordered the shift of classifying individuals from Patients Under Investigation (PUI) and Persons Under Monitoring (PUM), to Suspect, Probable and Confirmed COVID-19 Cases. Note that for rapid test kits, a person who tests positive is not yet considered a Confirmed Case, but still a Probable Case. [If we may add, we do not like the new labels, as it resembles the labels we use in criminal cases, an unfortunate coincidence which does not help in quelling the discrimination against COVID-19 patients.] The new classifications under DOH Administrative Order No. 2020 – 0013 dated 9 April 2020, are as follows:

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Hospitals Cannot Refuse Treating Patients in Emergency Situations

With the rapid rise of medical emergencies during the Coronavirus Disease 2019 (Covid-19) pandemic, concerns have been raised on the capacity of hospitals, clinics and and medical facilities to absorb the influx of patients. A number of hospitals already issued statements that they have exceeded their capacities. There are legitimate concerns about hospitals turning away patients by reason of overcapacity. 

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Guidelines on Teleconferencing, Video Conferencing and Other Remote or Electronic Means of Communications in Corporate Meetings: Summary

Regular and special meetings of stockholders or directors can be done by means of electronic communications. In Memorandum Circular No. 6, series of 2020, the Securities and Exchange Commission (SEC) provided the guidelines on the attendance and participation of directors, trustees, stockholders, members and other persons of corporations in regular and special meetings through teleconferencing, video conferencing and other remote or electronic means of communication. These guidelines apply to all corporations registered with the SEC.

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Mandatory Wearing of Face Masks or Other Protective Equipment in Public Areas

The wearing of face masks is now mandatory in public areas (see Face Masks: Mandatory to be Worn when Going Outside the House), per  Resolution No. 18 dated 1 April 2020 of the Inter-Agency Task Force for the Management of Emerging Infectious Diseases (IATF). To reinforce the mandatory nature of wearing face masks, the Department of Interior and Local Government (DILG) also directed all Local Government Units (LGUs) to:

  • 1. Strictly implement the mandatory wearing of face masks by all residents in public areas, whenever they are allowed to go out of their homes, at all times. LGUs shall issue local ordinances, executive orders or advisories on the mandatory wearing of face masks, to include imposition of sanctions to non-compliant residents as may be appropriate. Due to the prevailing shortage of face mask supplies, wearing of improvised masks and other protective equipment, such as indigenous, reusable, homemade or do-it-yourself masks, face shields and handkerchiefs, that can reduce risks of local transmission of the virus shall be allowed. 
  • 2. Encourage their respective communities to ensure the supply of face masks or other protective equipment by preparing/devising their indigenous, reusable, homemade or do-it-yourself masks and face shields.
  • 3. Conduct regular monitoring and ensure compliance of the public to the mandatory wearing of face masks for the duration of the enhanced community quarantine.

Considering that there are confirmed positive cases in all regions nationwide, LGUs outside the ECQ areas are also encouraged to implement the above-stated measures to prevent further local transmission. 

[Per DILG Memorandum Circular No. 2020-071 dated 9 April 2020, addressed to all Provincial Governors, City and Municipal Mayors, Punong Barangays, members of the Sanggunian, DILG Regional Directors and officers, BARMM Minister of the Interior and Local Government, and all others concerned.]

Enhanced Operations of BPOs and Export Enterprises During the Extended ECQ Period

The Department of Trade and Industry (DTI) issued a circular to ensure enhanced operations for Business Process Outsourcing (BPO) companies and export enterprises, and their service providers, throughout the extended Enhanced Community Quarantine (ECQ) period (extended until 30 April 2020, pursuant to OES Memorandum dated 7 April 2020; further extended to May 15 for high-risk areas). The following entities are covered by DTI Memorandum Circular No. 20-14, series of 2020 (issued on 11 April 2020): 

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Primer on the Rules on Liquidation of Closed Banks (A.M. No. 19-12-02-SC)

The Rules on Liquidation of Closed Banks (“Rules”), which took effect on 1 April 2020, was approved by the Supreme Court on 18 February 2020 (A.M. No. 19-12-02-SC). The Rules applies to banks closed and placed under liquidation by the Monetary Board (MB) of the Bangko Sentral ng Pilipinas (BSP). The summary or primer is provided below.

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Health Care Workers: Temporary Suspension of Deployment Abroad

Declaring Filipino health care workers as mission critical skills (MCS), the the Philippine Overseas Employment Administration (POEA) temporarily suspended their deployment abroad until the lifting of the national state of emergency and the COVID-19-related travel restrictions. Only recently, a public figure in the United Kingdom acknowledged the contribution of Filipino medical workers in their national health system, and some foreign recruitment agencies ramped up efforts to replenish the depleted number of medical workers in the fight against the Coronavirus Disease 2019 (COVID-19). But Filipino health workers cannot yet leave the country (see also financial aid for displaced OFWs).

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P10,000 for Overseas Filipino Workers under DOLE-AKAP for OFWs

A one-time financial assistance of Two Hundred US Dollars (US$200) or Ten Thousand Pesos (P10,000), or its equivalent in the local currency of the host country, for displaced Overseas Filipino Workers (OFWs) has been approved. On 8 April 2020, the Department of Labor and Employment (DOLE) issued Department Order No. 212, series of 2020, providing for guidelines on the provisional financial assistance for displaced landbased and seabased Filipino workers due to the Corona Virus Disease (COVID-19). This social amelioration program is called “DOLE-AKAP for OFWs” (separate from the CAMP and TUPAD#BKK for Philippine-based workers). The coverage and application procedure for displaced OFWs, based on D.O. 212, are discussed below.

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