Thursday, June 30, 2011

Pnoy designates DOJ as competition authority

"Aquino designates De Lima as competition authority"
GMA News Online, 15 June 2011
(Original article available here).

"President Benigno Aquino III has designated Justice Secretary Leila de Lima as the country’s competition authority tasked to prevent monopolies, cartels and protect consumers from abusive business practices.

In Executive Order 45 signed June 9, Aquino created the Office for Competition under the Department of Justice (DOJ), citing the need to promote competition and level the playing field in the market

According to the EO, De Lima was chosen for the task because she is the principal legal counsel and prosecution arm of the government, and also the central authority for matters requiring international legal cooperation.

“The DOJ likewise serves as the principal agency mandated to enforce the rule of law and investigate and prosecute offenders," the EO stated.

Being a competition authority, De Lima is tasked to investigate all cases involving violations of competition laws and prosecute violators to prevent, restrain and punish monopolization, cartels and combination in restraint of trade.

She will also enforce competition policies and laws to protect consumers from abusive, fraudulent, or harmful corrupt business practices.

It will also be her job to supervise competition in markets by ensuring that prohibitions and requirements of competition laws are adhered to, and to this end, call on other government agencies and/or entities for submission of reports and provision for assistance.

She will need to monitor and implement measures to promote transparency and accountability in markets.

De Lima is also tasked to prepare, publish and disseminate studies and reports on competition to inform and guide the industry and consumers and promote international cooperation and strengthen Philippine trade relations with other countries, economies, and institutions in trade agreements.

President Aquino also signed on June 3 Executive Order 44, which expands a public-private sector task force in charge of addressing investor issues in fresh bid to improve the global competitiveness of the Philippines.

In a press statement Wednesday, Executive Secretary Paquito Ochoa Jr. said EO 44 is a step toward enhancing the competitive ranking of the country while strengthening the local industries.

“The government and the business sector have the shared aspiration to jointly address the competitiveness indicators that will impact on our international competitiveness ranking and strengthen our industries, agriculture and service sectors, and thereby create more jobs and increase income," Ochoa said.

The President’s order renames the Public-Private Sector Task Force on Philippine Competitiveness, established on October 5, 2006, to National Competitiveness Council (NCC). The council is attached to the Department of Trade and Industry (DTI) and will report to the Cabinet’s Economic Development Cluster.

EO 44 beefs up the NCC with the inclusion of the heads of the Department of Energy (DOE) and the Department of Tourism (DOT). Other members are the secretaries of DTI and the Departments of Finance and Education, director general of the National Economic and Development Authority, and five representatives from the private sector.

Ochoa said the President deemed it important to include the DOE secretary in the joint panel in view of the rising cost of power that dulls the country’s international competitiveness.

“The DOT is included in the NCC in recognition of the fact that the development of the tourism industry holds the greatest potential for job creation and generation of additional revenues for the government," he said.

Under EO 44, the NCC serves as a primary collection point of investor issues that need to be addressed in order to improve international competitiveness in the industry, services and agricultural sectors.

The council will advise the President on policy matters affecting the competitiveness of the business sector and provide inputs to the Philippine Development Plan, the Philippine Investments Priority Plan and the Philippine Exports Priority Plan.

Part of the NCC’s task is to coordinate, monitor and ensure the implementation of key policy improvement processes associated with international competitiveness, as well as recommend legislation that may contribute to further boost competitiveness.

Designated to head the NCC was Trade Secretary Gregory Domingo with a private sector representative, to be appointed by the President, as co-chairperson. The five representatives from the private sector will have a term of two years.

The DTI-Center for Industrial Competitiveness serves as the NCC Secretariat to be headed by its executive director, with the support of a private sector staff headed by an operations director.

The EO earmarks P5 million, which will be drawn from the contingency fund of the Office of the President, for the operating expenses of the NCC. Subsequent annual funding of the council will be incorporated in the regular budget of the DTI and subject to existing accounting and auditing laws and regulations, while the private sector shall provide funding for its own activities. — Amita O. Legaspi/KBK, GMA News"

Wednesday, June 29, 2011

Nestle execs in Manila

"Spiced, not iced tea?"

by Willie Baun
Published 28 June 2011 in STREETLIGHTS, People's Journal
(Original article available online here)

"ALRIGHT, intractable six-cup Nescafe Joe warns, just as long as you don’t dunk bad news in my coffee mug; I say consider the caveat seconded.

With the hot and humid spell of summer blown off by the typhoon season, expect a drought of sorts in the market for soft drinks, juices, halo-halo and, oh yeah, iced tea. 

However, Nestle Philippines, Inc. executives John Miller, Shahab Bachani, and Nandu Nandkishore may well pick up the downer, as it were, while having to drink gallons of iced Nestea to cool off. 

The NPI triumvirate company and personal legal problems that, for sure, somehow dampened the recent celebration of the global Swiss firm’s 100 years in the Philippines. 

Perjury charges have been filed against them in the Makati and Quezon regional trial courts. Complainant in the case is no smalltime outfit that NPI can ignore, let alone mess with.

The plaintiff is Banco de Oro, which just happens to be owned by Forbes Magazine’s top Filipino billionaire – mall magnate Henry Sy, owner of the ubiquitous SM malls.

BdO’s issue with NPI is its alleged failure to divulge prior knowledge of the financial woes of an NPI-favored distributor, who kept getting bank loans on the strength of the endorsements by aforementioned NPI execs. 

Some NPI distributors have also complained to the Department of Trade and Industry and taken legal action against the firm’s bully tactics – alleged instances of predatory pricing that sacrificed their profitability to the goal of booting rival brands out of contention. 

Shouldn’t pouring when it rains be bad enough for NPI? I’m inclined to agree if only for the Nescafe aroma that delights me as I write. But then again there’s simply more! 

This refers to the long-festering labor dispute in the NPI plant in Cabuyao, Laguna where more than 600 employees had gone on strike nine years ago to compel management to the bargaining table and discuss wages and benefits. 

The company purportedly simply turned a deaf ear to the worker’s plaints, allegedly to this date, has all but disregarded the Supreme Court’s decision in 2006, ordering NPI to reinstate the strikers and initiate formal negotiations. 

In the meantime, some of the strikers have reportedly been killed mysteriously, notably union leader Melito Roxas and his successor Diosdado Fortuna. 

Perhaps Mssrs. Miller, Bachani, and Nandkishore would care to share their iced tea with those who feel they’ve been mistreated by their company for the longest time. Or should it be spiced tea to ensure the complainants just grin and bear it?"

Wednesday, June 22, 2011

Paul Bulcke and Frits Van Dijk visit Nestle Philippines

"Bank chief charged by employees, officers"
by Emil Jurado
Published 22 June 2011, TO THE POINT, Manila Standard Today
(Original article available online here)

One hundred years of operations here in the Philippines is truly a milestone for Nestlé Philippines Inc., the subsidiary of the Swiss-based world fs largest food and nutrition conglomerate.

In a month-long run-up to its anniversary, NPI ran several heartwarming institutional and product commercials on television and radio, all aimed at reminding the public of the value and significance of its long presence in the Philippines. High-profile corporate social responsibility projects were also set into motion.

Unfortunately for NPI and its special guests for the anniversary celebrations who have come to the Philippines from Nestlé fs head office in Switzerland \chief executive Paul Buicke and executive vice president Frits Van Dijk \some serious and long pending issues may serve as party poopers.

These issues, for sure, won ft be on the program fare, but will or should come out during business discussions between the local and foreign Nestlé executives.

To start off, there is the labor issue in NPI fs Cabuyao, Laguna plant that has been festering for almost 10 years and has been blamed for the deaths of a number of strikers. Despite a Supreme Court ruling handed down in 2006 that ordered NPI to hire back the strikers and start negotiations, the company has stood firm, in defiance of the order.

There, too, are the cases filed against NPI by some of its distributors, who cited Nestlé fs policies and practices that have severely affected their operations, to the point that a number of them have closed shop.

Unfortunately for Nestlé and other multinational companies, the noise created by those cases versus NPI has reached the ears of legislators in both chambers of Congress, who have found extra cause to pursue an Anti-Trust measure that will precisely address the so-called bullying tactics of giant multinationals like NPI.

The two visiting executives of Nestlé probably went sleepless after NPI fs 100th anniversary festivities, and its wouldn ft have been due to downing several cups of their favorite brand of coffee."

Nestle CEO visits Philippines

Nestlé CEO’s Philippine visit may help resolve distributor woes

Published 18 June 2011 in Metrofile, The Daily Tribune
(Original article available online here)

"The visit to the Philippines of Nestlé global CEO Paul Bulcke could help resolve the controversy concerning the alleged anti-trust practices being committed by Nestle Philippines Inc. (NPI) against its local Filipino distributors. Bulcke is arriving in Manila today, June 16, to take part in NPI’s ongoing centennial celebration which is being observed, with the theme “Kasambuhay, Habambuhay (Companion in Life, for Life)”. NPI’s Filipino distributors are hoping that Bulcke’s Manila sojourn could provide the spark for the resolution of the continuing disputes between the two sides that have led to the filing of charges in court against the Swiss-based multinational. 

Bulcke, a Belgian businessman appointed global CEO in 2007, has described Nestlé under his tenure as ‘une force tranquille’ which translates to “calm strength.” In this regard, anti-trust lobbyist and lawyer Lorna Kapunan expressed hopes that this tranquility covers not only the running of the head office in Switzerland, but its operations in the Philippines as well. Kapunan is the legal counsel of two of the local distributors that have filed complaints against NPI in the local courts and in the Department of Trade and Industry.

“Seeing as how disorganized NPI has responded to the cases we have filed against them, one can only hope that Bulcke’s presence will not only resolve the concerns raised by my clients, but will also realign the company to the head office’s standards on fair trade and competition,” Kapunan said. “After all, being the top executive of Nestlé, Mr. Bulcke should know their Code of Business Conduct by heart. Specifically, he should examine whether the Nestlé Philippines complies with Section 7 of this Code, which clearly states that commercial policy and prices will be set independently and will never be agreed, formally or informally, with competitors or other non-related parties, whether directly or indirectly.” 

On the other hand, NPI Chairman and CEO John Miller stated that the company’s ongoing celebrations are meant to affirm the Filipino’s love for family, in that “Nestlé products have become very much a part of the Filipino families’ way of life.” NPI ranks among the top 3 subsidiaries in the region comprising of Asia, Oceania, and Africa, and is ranked number one among the Asean countries. "

Cease and Desist Order against Nestle

CDO on Nestle; PNoy antics sunk

by Willie S. Baun
Published online on 22 June 2011, STREETLIGHTS, Journal Online, People's Journal
(Original article available here)


One caveat to heed

“Woe unto hypocrites,” is a warning that a global baby food chain should hopefully won’t ever ignore again. It’s courtesy of this corner’s regular kibitzer Jose from the files of the Advertising Standard Council. 

ASC recently issued a Cease and Desist Order (CDO) to Nestle Philippines for its Nido 3+ ad featuring endorser Presidential sister Kris Aquino and her son Baby James.

In the litigated  Nido 3+ television commercial, a competitor was alluded to on the issue of sugar levels to inform the public that Nestle’s baby formula has more milk and less sugar, while its rival has the opposite, i.e., less milk, more sugar. But the strategy boomeranged. 

It was, however, cited before the ASC that Nestle used a misleading and inaccurate claim to sway consumers that Nido+ has less sugar by trumpeting the equation “less carbohydrates = less sugar.” 

ASC was told that apparently, Nestle means Sucrose when they say sugar, which encompasses glucose, lactose, carbohydrates, moreover, include polyols and poly-saccharides. Obviously, carbohydrates levels do not have one-is-to-one ratio with Sucrose in milk since in the formulation, there are other sources of sugar and carbohydrates. 

Additionally, Nestle purportedly advanced the false claim that Nido+ has the lowest carbohydrates content among 3+ milks, implying by transitivity that it has the lowest sugar level (if less carbohydrates = less sugar, and Nido 3+ has the lowest carbohydrates, therefore, Nido3+ has the lowest sugar.) 

The claim that Nido3+ has the lowest carbo content among 3+ milks actually meant, however, it has lowest sucrose content, not sugar. But if you add total sugars in the formulation, it turns out that Nido+ has 15 percent more sugar than its competitor. 

The Nestle gambit bombed. The ASC for good reason for the CDO issuance and has directed media outfits to stop airing the Nido+ ads. 

As the CDO rings the alarm “Woe unto Hypocrites,” I can’t help thinking how Churchill would have detested using sugar to mean sucrose and vice versa so loosely. The sin he called“terminological inexactidude” has remained unforgiveable."

Thursday, June 16, 2011

Atty. Lorna Kapunan talks to Karen Davila on anti-trust - HEADSTART, ABS CBN News Channel

Image from Karen Davila here.

16 June 2011 - Atty. Lorna Kapunan was a guest this morning at ANC Headstart, hosted by Karen Davila.   Atty. Kapunan talked about the need for a comprehensive anti-trust bill and how large companies and foreign multinationals such as Nestle Philippines, Inc. continue to get away with possible anti-trust violations because of the lack of a regulatory body with teeth.

The show "Get a 'Headstart' with Karen Davila" is a daily news program which airs live every 8:00 am at the ABS-CBN News Channel (ANC) (Skycable Channel 27).

ANCALERTS Twitter updates - Kapunan on anti-trust

Twitter updates from ABS-CBN News Channel / ANCALERTS.

ANCALERTS: Kapunan: An anti-trust law will control unfair pricing, protect small & medium firms

5 hours 22 min ago
ANCALERTS: Kapunan: An anti-trust law will control unfair pricing, protect small & medium firms

ANCALERTS: Kapunan: There's no gov't agency that monitors pricing. Some argue that pricing is a function of the open market but that is not so.

5 hours 28 min ago
ANCALERTS: Kapunan: There's no gov't agency that monitors pricing. Some argue that pricing is a function of the open market but that is not so.

ANCALERTS: Kapunan on PLDT-Sun merger: What makes it dangerous is 'cartelization'. They may appear as competitors but it is open to price manipulation.

5 hours 30 min ago
ANCALERTS: Kapunan on PLDT-Sun merger: What makes it dangerous is 'cartelization'. They may appear as competitors but it is open to price manipulation.

ANCALERTS: Kapunan: An anti-trust law crucial because 95% of businesses here are SMEs that the anti-trust bill seek to protect

5 hours 33 min ago
ANCALERTS: Kapunan: An anti-trust law crucial because 95% of businesses here are SMEs that the anti-trust bill seek to protect

ANCALERTS: Kapunan: There's no anti-trust code in the country. What we have are separate legislation in separate laws. That's why it's easy to violate.

5 hours 34 min ago
ANCALERTS: Kapunan: There's no anti-trust code in the country. What we have are separate legislation in separate laws. That's why it's easy to violate.

ANCALERTS: Now on ANC: RT @Karen_DaviLa: Atty. Lorna Kapunan talks about need for "Anti-Trust Code" in Philippines

5 hours 35 min ago
ANCALERTS: Now on ANC: RT @Karen_DaviLa: Atty. Lorna Kapunan talks about need for "Anti-Trust Code" in Philippines

100th birthday for Nestlé Philippines

Nestlé Philippines' 100th birthday
by Ducky Paredes
Published 16 June 2011 in MALAYA, Business Insight
(Original article available online here)

"IN commemoration of Nestlé Philippines’ 100th year anniversary, the local subsidiary of the world’s largest food and nutrition company will have two very special visitors -- Paul Bulcke, Nestlé S.A. Chief Executive Officer, and Frits Van Dijk, Nestlé S.A Executive Vice President and Zone Director for Asia, Oceania, Africa, and the Middle East -- for a couple of days in order to make Nestlé’s milestone year even more significant. 

Surely, their presence here will boost the morale of well-meaning Nestlé Philippines (NPI) employees — after all, how many times do the highest-ranking executives of a top-50 global corporation visit the country? The company has invested greatly in its centennial celebration, (including a tri-media and online advertising campaign and various CSR initiatives). The arrival of Bulcke and Van Dijk is therefore envisioned to be the shining star among a long list of activities. 

While goodwill creation may be the primary reason for the visit, my NPI source hints that it is also an information gathering activity. Pardon the coffee-inspired pun, but their trip may also serve a "3-in-1" purpose that will ultimately help Nestlé S.A. decide on whether they will intervene in certain issues that have served as a self-created plague destroying the Nestlé’s Philippine office. 

The first chore for the two Nestlé bigwigs is to examine the unresolved labor issue in their Cabuyao plant. Nine years has passed since more than 600 plant employees went on strike to enforce their right to negotiate their retirement benefits, and this labor-management conflict has drawn the attention of local and international media, human rights advocates, and cause-oriented groups.

The Cabuyao issue is particularly volatile. Very much contrary to the good image that Nestlé promotes for itself, this issue has resulted in 23 strike deaths, including those of union leader Meliton Roxas and the man who replaced him, Diosdado Fortuna. Roxas was killed right in front of the picket line in the middle of a protest, while Fortuna was killed on his way home. Without pointing any fingers, any outside observer would have to conclude that their and the 21 other killings could well have been strike-related.

There are also unresolved legal issues. While our Supreme Court has handed down repeated rulings in favor of the workers, NPI has chosen to simply ignore the Court. Last 2006, in fact, the Court explicitly ordered Nestlé management to call back its workers and initiate formal negotiations. Five years later, NPI has done nothing – NPI has not called back the workers; nor has it resumed formal talks.

Another item supposedly on the Nestlé S.A. agenda is the propensity of NPI’s top management to get themselves into legal trouble. At present, a number of their top executives – John Miller, Shahab Bachani, and Nandu Nandkishore – are facing perjury charges in Regional Trial Courts in both Quezon City and Makati. Miller happens to be the present Chief Executive Officer of Nestlé Philippines. One has to wonder how that looks as far as Nestlé S.A. is concerned.

Moreover, NPI’s legal entanglements do not end with their executives. The Philippines’ largest bank, Banco de Oro, is suing the company for false and deceptive testimony. While lawsuits may be a normal part of doing business when one is the size of Nestlé Philippines, to have the country’s biggest financial institution suing you for lying has to be an entirely different reality.

Finally, another issue that Bulcke and Van Dijk are reportedly monitoring is the possibility of a comprehensive Anti-Trust Bill finally being passed into law. Being alluded to many times as the poster boy for corporate bullying and exemplifying a tyrannical multinational, the spotlight would be right at NPI if ever this legislation pushes through. Even now, a number of their bankrupt distributors have gone to the Department of Trade and Industry (DTI) with complaints of predatory pricing and lack of corporate ethics complaints against NPI. 

The anti-trust issue has gained a lot of legislative momentum and with the diatribes of anti-trust advocate Lorna Kapunan, among the lawyers of anti-NPI clients, the movement towards an anti-trust Law is gaining even more ground. Considering the number of pressing matters that Bulcke and Van Dijk have to attend to, I sure hope they drank a lot of coffee and ate their cereal. They’re going to need Olympic energy to tackle the mess that Nestlé Philippines has made of what Nestlé S.A. means to Filipinos."