THE Department of Finance (DoF) has welcomed the approval of the Mighty Corp.-Japan Tobacco International (JTI) (Philippines) Inc. buyout deal, reiterating that the government’s P30-billion windfall will benefit Marawi City and the military.
“We appreciate PCC’s quick action as this will mean that the taxes and penalties due to the government will flow into its coffers as scheduled,” Finance Secretary Carlos Dominguez 3rd told reporters in a message late Tuesday.
The anti-trust body Philippine Competitive Commission (PCC) approved the sale of the country’s second-largest cigarette maker’s assets to JTI, saying: “There appears to be no ability nor incentive for the parties to engage in anti-competitive coordinated behavior.”
The PCC is a quasi-judicial body created by law to promote and maintain market competition and a level playing field for business by keeping in check anti-competitive practices.
Under Section 3 of the Implementing Rules and Regulations of the commission, parties to any merger or acquisition must notify and seek prior approval of the Commission if the transaction value is at least P1 billion.
In July, Mighty offered to settle its tax liabilities valued at P25 billion, but Dominguez noted the amount could still go up to P30 billion once the value-added tax and other fees were included in final computation of the settlement.
“This windfall of P30 billion is much needed to assist the displaced residents of Marawi, reconstruct the damaged portion of Marawi City, and to strengthen the Armed Forces capabilities against terrorists,” he said.
The Bureau of Internal Revenue (BIR) received the first tranche of Mighty’s settlement offer of P3.44 billion on July 20.
Even if the government finally accepts the settlement, it does not preclude any criminal charges that the BIR may file against Mighty, “as criminal cases cannot be compromised,” Dominguez had pointed out. MAYVELIN U. CARABALLO