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Friday, March 29, 2024

PECO facing new legal woes due to permit failure

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Panay Electric Co. may be facing new legal cases due to its failure to renew its business permit and settle its real estate taxes to the city government.

“For PECO to be issued business permit renewal, they have to settle first their real property tax as matter of procedure pursuant to our local revenue code,” said Norman Tabud, head of the Iloilo City Business Permits and Licensing Office.

Tabud said PECO was not able to secure a business license to operate in 2019 in violation of the city’s Tax Revenue Code on the recommendation of the City Treasurer’s Office for failing to pay its real estate taxes.

“[PECO] had failed to secure a business permit to operate since last year [2018] because of an instruction from the City Treasurer’s Office to hold in abeyance the issuance of the permit pending the company’s payment of its realty tax obligations,” Tabud said.

The city assessed PECO’s real estate tax dues at P90 million and additional penalties since March this year.

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PECO’s tax obligations arose from a new ruling from the City Treasurer that the lot on which PECO’s electricity poles are located are also taxable real estate.

City Treasurer Jinny Hermano, in a memorandum to the Iloilo City BPLO dated March 12, stated that all businesses can only secure business permits to operate after it had settled all obligations to the city government, including real estate taxes, citing Section 252 of Tax Ordinance No. 2007-016 or the Local Revenue Code.

Hermano said that since PECO has not settled P89.6 million in assessed tax on the real estate where its electricity poles stand, the business permit should be held in abeyance.

Tabud said violations may affect PECO’s Certificate of Public Convenience and Necessity (CPCN) issued by the Energy Regulatory Commission, which requires all distribution utilities to comply with all legal requirements for any business to operate in any area.

PECO is operating under a two-year CPCN to ensure uninterrupted power supply in Iloilo City as part of the franchise granted to More Electric and Power Corp.

PECO is already facing investigation by the ERC because of a complaint filed by Iloilo City Mayor Jerry Trenas to address the continuing rising problem of its aged electricity poles that pose danger to residents.

Trenas asked the ERC to investigate and perform its function to protect consumer interests after nine PECO electricity poles all around the city caught fire. He also asked Malacanang to look into the matter. 

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