Question & AnswerQ&A (AMENDED RULES AND REGULATIONS TO IMPLEMENT PRESIDENTIAL DECREE NO. 66, AS FURTHER AMENDED BY EXECUTIVE ORDER NO. 226 OTHERWISE KNOWN AS THE OMNIBUS INVESTMENTS CODE OF 1987)
They are the rules promulgated to implement Presidential Decree No. 66, as further amended by Executive Order No. 226, also known as the Omnibus Investments Code of 1987.
Any person, firm, association, partnership, corporation, or any other form of business organization, regardless of nationality, control and/or ownership of the working capital thereof may apply for registration.
A zone export enterprise that is engaged in manufacturing or producing new products not commercially produced in the Philippines, uses new and untried processes, produces non-conventional fuels or equipment, and substantially uses domestic raw materials whenever available.
It is an exemption from income tax for a specified number of years: six years for new pioneer firms, four years for new non-pioneer firms, and three years for expanding firms, from the start of commercial operations.
Its certificate of registration is automatically cancelled, and it ceases to be entitled to the incentives provided under the Decree and the Code.
The machinery and equipment must be directly and exclusively needed by the registered export enterprise and the importation of spare parts is limited to specific authorized machinery.
Minimum fine of 150% of the value of the goods based on invoices or commercial documents, up to a maximum of 200%, plus possible cancellation of registration and imposition of penalties under Section 28 of the Decree.
They must maintain separate books of accounts for operations inside the zone and submit various financial, operational, and compliance reports to the Authority on or before their due dates.
Yes, they may employ foreign nationals in supervisory, technical, or advisory positions up to five years from registration, extendible upon recommendation, with requirements including training Filipino understudies and filing sworn applications with the Department of Justice.
It means the national territory outside of the zone or export processing zones.
The merchandise shall be treated as foreign merchandise entering the country for the first time and be subjected to applicable import laws and duties.
Additional deduction for labor expenses, tax credit on domestic capital equipment, exemption from contractor's tax, exemption from wharfage dues and export tax, and exemption from local taxes and licenses except real estate taxes under specified conditions.
They automatically belong to the Authority without cost, and a new lease agreement may be entered into if mutually agreed upon between the parties.
The firm must meet specific criteria such as capital equipment cost per worker not exceeding US$10,000, indigenous raw materials use being at least 50%, and net foreign exchange savings or earnings averaging at least US$500,000 annually during the first three years of operation.