MANILA, Philippines - One of the biggest law firms in the Philippines has strongly welcomed the passage into law of the Personal Equity and Retirement Account (PERA).
“The PERA helps to institutionalize the attitude for savings and investments among Filipinos, especially the overseas Filipino workers (OFWs),” Judith V. Lopez, income chairman and senior partner of Isla Lipana & Co.
Isla Lipana is a member of PriceWaterhouseCoopers International Ltd., one of the world’s largest law firms providing focused assurance, tax, and advisory services.
The PERA will establish a legal and regulatory framework for voluntary personal retirement plans, comprised of voluntary personal savings and investments, and promote capital market development and savings mobilization, contribute to long-term fiscal sustainability through long-term financing.
Lopez said that the PERA is ideal for overseas Filipino workers who oftentimes do not know what to do with their money other than spend on consumption, tuition fee, housing, but not on savings and investment.
“They have little knowledge in putting their earnings into investment products,” she added.
However, concerns have been raised on the delays on the issuance of PERA’s implementing rules and regulations (IRR).
A technical working group was formed to release the draft IRR for comment from the private sector and the various government regulators, which includes the Bangko Sentral ng Pilipinas (BSP), the Securities and Exchange Commission (SEC), and the Bureau of Internal Revenue (BIR).
BSP Deputy Governor Nestor A. Espenilla Jr. earlier said that there are still actuarial issues to be defined, which directly affects the character and scope of the PERA administrator and investment manager.
The PERA law designates trust licensee holders as administrator and investment managers. Majority of the trust department of commercial banks have trust licenses.