Law Summary

1. Authority

• Legal Basis: The Memorandum Order is grounded on several legal frameworks:
  • Presidential Decree No. 857, as amended.
  • Board Resolution No. 2188 (May 25, 2009).
  • BoardCom Resolution No. 2009-1186 (confirmed by Board Resolution No. 2188).
  • BoardCom Resolution No. 2010-1234 (confirmed by Board Resolution No. 2218).

2. Purpose

• Objective: This Memorandum Order aims to expedite the collection of dormant accounts, thereby avoiding prolonged and costly judicial actions.

3. Coverage

• Scope of Application:
  • Applies to all dormant accounts exceeding 365 days.
  • Excludes dormant rental billings in PMO North Harbor, which are governed by separate orders (PPA Memorandum Order No. 03-2009 and PPA Memorandum Order No. 20-2009).

4. Guidelines

4.1 Payment Schemes

• Boardcom Resolutions:
  • 4.1.1 Full Payment Incentive:
    • Terms: 0% interest and penalties for full payments made within 12 months (via post-dated checks) from the latest Notice of Collection.
  • 4.1.2 Restructuring Options for Partial Payments:
    • Initial Payment Requirement: At least 25% of the total principal amount.
    • Restructuring Agreement: Must be executed with the PPA with monthly post-dated checks.
      • Interest and Charges:
        • Simple interest of 6% per annum and penalty charges of 6% from invoice date to Restructuring Agreement date added to principal.
        • Built-in interest of 6% per annum during the restructuring period.
        • 0% penalty charges during the restructuring period.
        • Defaulted amortization incurs 12% interest and 25% penalties as per PPA Administrative Order No. 01-02.
  • Program Availability: This Collection Program is available until December 31, 2011.

5. Repealing Clause

• Effect of Memorandum: This order repeals, amends, or modifies all prior circulars, regulations, and issuances that conflict with its provisions.

6. Effectivity

• Implementation Timeline: The Memorandum Order will take effect 30 days post-publication in the Official Gazette or a newspaper of general circulation.

Key Takeaways

• The PPA Memorandum Order No. 24-2010 establishes a structured payment scheme for dormant accounts aimed at efficient collection without litigation.
• It provides options for full payment and account restructuring, with specific interest and penalty terms.
• The program is time-sensitive, expiring on December 31, 2011, and necessitates adherence to newly established guidelines.
• Prior inconsistent regulations are repealed to streamline the collection process under this Memorandum Order.