NextGen Day

Both the House and Senate versions of the proposed Maharlika Investment Fund (MIF) have several “unclear” rules, such as those pertaining to investment gains and the makeup of its board of directors, according to Senator Francis Escudero.

During the Senate Committee on Banks’ initial hearing on the bill on Wednesday, Escudero pressed the government economic managers for clarifications.

The “approved capital stock” of the Maharlika Investment Corporation (MIC), which was left out of both legislation, was one of his concerns, he claimed.

“It is not possible for me to join a corporation with no authorized capital stock. Alam dapat ng economic managers natin ‘yan sa lahat ng tao (We cannot establish a corporation without authorized capital stock. The economic managers should know that of all people “added Escudero.

Escudero stated that the contributions made by each investor must be taken into account when determining the Board of Directors for the MIF.

The Development Bank of the Philippines (DBP) and Landbank of the Philippines (LBP) will each contribute PHP50 billion and PHP25 billion, respectively, under the proposal.

The MIC will consist of the Secretary of Finance, the Chief Executive Officer of the MIC, the Presidents of the LBP and DBP, six regular members representing fund contributors, and five independent directors from the private, academic, business, and investment sectors. This structure is the same in both the House and Senate versions.

“Does the Board of Directors have the authority to limampung porsyento galing sa Landbank? Galing dalawampung porsyento sa DBP? Shouldn’t Landbank be given a 50% [seat] on the Board of Directors? Binigyan lang nila ng tig-iisang representative ang Landbank at DBP. 20% from the DBP? They were each given just one representative “explained Escudero.

Since this is the first time we are doing it, he said, “Maganda mula’t mula, dahil din unang beses nating ginagawa ito, klaro na (It is better if it should be clear from the start)”.

National Treasurer Rosalia de Leon stated during the hearing that the contributors would be represented by regular members.

According to De Leon, “Each government financial institution may increase its investment above the required equity contribution and they shall be entitled to prudential and other regulatory reliefs as may be determined by the Bangko Sentral ng Pilipinas to ensure their financial soundness while supporting the overall objective of the Fund.”

The legislation also suggests that government-owned gambling companies like the Philippine Amusement and Gaming Corporation and others contribute at least 10% of their gross gaming revenues.

Royalties and special assessments on natural resources based on the fiscal framework that the national government will apply, as well as earnings from the privatization of public assets, are additional sources of funding.

After the House of Representatives passed their version of the MIF on December 15, 2022, Senator Mark Villar, the chairman of the Committee on Banks, announced he submitted Senate Bill No. 1670 to begin the talks on the MIF.

“The Senate will fulfill its role as an independent institution by reviewing and debating legislation that affects the national interest. We won’t hurry. For the interest of the Filipino people, we will take our time to create the finest version we can “added Villar.

President Ferdinand R. Marcos Jr. had already requested that the Senate review the proposed MIF even though he had designated the bill as urgent.

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