The Senate on Wednesday, December 16, rejected President Rodrigo Duterte’s “conditional” certification as urgent of a bill meant to update the country’s law against money laundering.

During the Senate’s plenary session on Wednesday – the last one for the year – several senators questioned the “conditionalities” contained in Duterte’s certification, which they said encroached upon the Senate’s independence.

“This is the first time I have seen a certification with conditions, and possible amendments,” said Senate Majority Leader Juan Miguel Zubiri.

“I’m not going to pretend that I know the mind of Malacañang or the President in issuing such a certification with conditions, but I know, for the short time that I have been in the Senate, that this is the first time I have seen a certification with conditions,” said Senator Grace Poe, sponsor of Senate Bill (SB) No. 1945.

Also known as “an act to further strengthen” the Anti-Money Laundering Act (AMLA), the bill is aimed at preventing the Philippines from being “grey-listed” by the Financial Action Task Force on Money Laundering (FATF)  International Cooperation Review Group’s Asia Pacific Joint Group.

“I am just a little bit bothered by those conditions,” added Poe, citing the separation of powers among the executive, the legislative, and the judicial branches of government.

“By putting those conditions…it basically tells us to pass that version alone, if we really want this bill to be qualified for that certification. So in short, nakadikta po dito kung ano dapat ang probisyon na dapat nating ipasa (this dictates what provisions we ought to pass),” said Poe.

Duterte’s certification, dated December 15, states that it “is subject to the proposed reduction of the threshold for tax crimes to P20 million, retention of the prevailing reporting threshold for real estate transactions, and grant of the requested additional investigative powers to the Anti-Money Laundering Council” or AMLC.

In the letter, Duterte said these provisions “are absolutely essential to achieving the objectives of this bill.”

Poe was concerned that the President “is almost bordering on telling us what provision should be included.”

“I understand there’s always a meeting of the minds sometimes when we confer with members of the executive, but then, unless the body decides collegially, and unless this is something we decide on on our own, I don’t think it will be to the democratic process to just pass this bill based on what is written in this certification,” Poe said.

“I’m trying to be very diplomatic here, but I will always say this: That I will accept the amendments which I feel our colleagues have decided to be what is fair and what is right, and what will be effective in this law,” she added.

Senate President Vicente Sotto III, a political ally of Duterte, agreed with Poe and the other senators who raised the issue.

“Yes, indeed, there are times when the executive department would whisper their wishes on certain pieces of legislation, but it is never written down in black and white. This is the first time that it is done. I don’t think it will qualify as a letter of certification as far as the Senate is concerned because it violates the separation of powers,” Sotto said.

Lacson asked whether the Senate should then proceed with its work on the bill not minding the conditional certification, “without showing any signs of disrespect to Malacañang.”

Sotto answered in the affirmative. “We will approve what the members of the Senate want to approve as far as the 2nd reading is concerned.”

Approved on 2nd reading

The Senate approved SB No. 1945 on 2nd reading on Wednesday. Disregarding Duterte’s certification, the chamber will observe the 3-day interval rule between a bill’s 2nd and 3rd readings.

As Congress will go on recess starting Thursday, December 17, the bill will be up for passage on 3rd reading when session resumes in January 2021.

SB No. 1945 proposes the following amendments to the existing AMLA:

• Inclusion of tax crimes and violation of the Strategic Trade Management Act, which indirectly includes proliferation of weapons of mass destruction, as predicate offenses to money laundering
• Enhancement of the investigative powers of the AMLC
• Authorization of the AMLC to implement “targeted financial sanctions” on proliferation financing
• Prohibition on the issuance of injunctive relief against freeze orders and forfeiture proceedings
• Authorization of the AMLC to preserve, manage, or dispose of assets subject of asset preservation order and judgment forfeiture

Poe earlier said the FATF has urged the Philippines to tighten its measures against money laundering “as a form of national economic emergency, due to the very serious economic costs” of non-compliance with international standards and practices.

If the Philippines fails to comply with these, it will be “grey-listed” and subject to more stringent checks when transacting with other countries. This will dampen investor and lender confidence, and make it more difficult for overseas Filipinos to remit money back home, Poe said.

In crafting the bill, Poe said it was necessary to ensure the Philippines will not be “grey-listed,” but also avoid “too much of an imposition” of foreign standards on the country’s transactions.

The proposed measure also aims to cut terrorist funding.

The House of Representatives passed its version of the bill amending the AMLA on December 1. – Rappler.com