Question & AnswerQ&A (EXECUTIVE ORDER NO. 182)
The Executive Order aims to attract, promote, and increase productive investments in the Philippines to ensure sustained economic growth and achieve its goal of becoming a newly industrializing economy.
The Foreign Investment Negative List is a list annexed to the Executive Order that enumerates areas reserved exclusively to Philippine nationals or areas with restrictions on foreign equity participation as mandated by the Constitution and specific laws.
Areas with no foreign equity allowed include Mass Media, Licensed Professions (such as Engineering, Medicine, Law), Retail Trade, Cooperatives, Private Security Agencies, Small-scale Mining, Utilization of Marine Resources (except deep sea fishing), and the Rice and Corn Industry unless authorized by the National Food Authority.
Foreign equity participation in private recruitment services is limited to up to twenty-five percent (25%).
Amendments to the list can only be made once every two years, following provisions in Section 8 of the Foreign Investments Act and corresponding Implementing Rules and Regulations.
Foreign ownership and management of public utilities are limited to a maximum of forty percent (40%) foreign equity as mandated by the Constitution and Commonwealth Act No. 146.
Restrictions are placed for reasons of security, defense, risk to health and morals, and to protect local interests, requiring clearances from authorities such as the Philippine National Police and Department of National Defense.
All prior orders, issuances, rules, and regulations or parts thereof that are inconsistent with this Executive Order are revoked or modified accordingly.
It took effect immediately following the end of the transitory period on October 24, 1994.
The Foreign Investments Act (RA 7042) of 1991 governs the limitation and regulation of foreign investments in the Philippines. Sections 8 and 9 vest the President with the authority to issue the Foreign Investment Negative List as implemented by this Executive Order to regulate foreign equity participation in certain sectors.