Tourism Act of 2009: National Tourism Policy

Declaration of policy and objectives

Section 2 declares tourism an indispensable element of the national economy and an industry of national interest and importance.
Section 2 states tourism must be harnessed as an engine of socioeconomic growth and cultural affirmation to generate investment, foreign exchange and employment and to strengthen national pride.
Section 2 directs the State to pursue: Filipino-centered tourism; conservation and promotion of heritage and identity; sustainable tourism; promotion of an international image of the Philippines; development of the Philippines as a prime tourist hub and convention center anchored on history, culture, and natural endowments; and encouragement of private sector participation and agritourism.
Section 3 sets objectives covering: national tourism action planning; tourism awareness and heritage preservation (including youth education); preferential treatment to employment of Filipino nationals; full government assistance via investment incentives and financing schemes; prevention of profiteering/speculation to the detriment of local residents; and protection against exploitation of women and children in tourism.
Section 3 further aims to: enhance consumer choice via competitive tourism markets; improve tourism data collection and dissemination; protect the right of the people to a balanced and healthful ecology through environmental protection, conservation and restoration; and develop responsible, community-participatory tourism including indigenous peoples in conserving biophysical and cultural diversity.
Section 3 provides objectives to strengthen tourism councils and encourage NGO/PO/private-sector participation; develop transportation policies supportive of tourism; maintain convention-handling capability; balance tourism development between urban and rural areas for poverty alleviation and reduced regional imbalances; strengthen LGU capability in tourism management; maintain international standards of excellence; enhance international business relations through partnerships and joint ventures; and support establishment of Tourism Enterprise Zones (TEZs).
Section 3 also provides for ensuring a sustainable funding mechanism for tourism policies, plans, programs, projects, and activities.

Definitions and core concepts

Section 4 defines “Department” as the Department of Tourism created under Presidential Decree No. 189 (1973), as amended.
Section 4 defines “Secretary” as the Secretary of Tourism.
Section 4 defines Duty Free Philippines (DFP) and Duty Free Philippines Corporation (DFPC) based on Executive Order No. 46 (1986) and the corporate entity created from DFP pursuant to the Act.
Section 4 defines key attached and related entities and concepts: PCVC, Intramuros Administration (IA), PRA, TIEZA, Tourism Enterprise Zone (TEZ), TEZ overseer, TEZ operator, TEZ Administrator, registered enterprise, PTA, and TPB.
Section 4 defines “Tourism enterprises” broadly as facilities, services and attractions involved in tourism (including travel and tour services; tourist transport services by land/sea/air; tour guides; adventure sports services; convention organizers; accommodation establishments; tourism estate management; restaurants/shops; sports/recreational centers; spas; museums/galleries; theme parks; convention centers; and zoos).
Section 4 distinguishes: “Primary tourism enterprises” (including travel and tour services; tourist transport services exclusively for tourist use; accommodation establishments; convention and exhibition organizers; tourism estate management services; and other enterprises identified by the Secretary after consultation), and “Secondary tourism enterprises” (all other tourism enterprises not covered as primary).
Section 4 defines tourism zone types: Greenfield Tourism Zone (new/pioneer development as determined by TIEZA) and Brownfield Tourism Zone (area with existing infrastructure/development as determined by TIEZA).
Section 4 defines “Foreign visitors” as all passengers using foreign passports, and defines “Sustainable tourism development” as management of resources meeting tourist and host-region needs while protecting future opportunities—fulfilling economic, social and aesthetic needs while maintaining cultural integrity, essential ecological processes, biological diversity and life support systems.

Tourism Department governance structure

Section 5 establishes the Department of Tourism as the primary planning, programming, coordinating, implementing and regulatory government agency for domestic and international tourism development and promotion.
Section 6 vests the Department with powers and functions including: formulating tourism policies/plans/projects; supervising and coordinating implementation; calling on government agencies to carry out coordinated programs; and communicating to the President and heads of agencies the impact of proposed governmental actions on tourism and the economy.
Section 6 requires the Department to: provide integrated market development; represent the government in domestic/international tourism conferences and in multilateral/bilateral treaties concerning tourism (and ensure compliance with obligations); request presidential representation in bodies affecting tourism; and coordinate with departments to facilitate visas, simplify travel and immigration procedures, and ensure efficient, fair, courteous enforcement for hospitable reception of visitors.
Section 6 directs the Department to support protection/maintenance/preservation of historical, cultural, and natural endowments and take measures against acts or omissions contrary to these objectives.
Section 6 empowers the Department to monitor community conditions and issue timely travel advisories in consultation with LGUs and law enforcers on safety or viability and on patronage of tourism-related entities/products.
Section 6 requires the Department to evaluate tourism development projects for permits and incentives, establish a databank of tourism areas and projects for investment purposes, and encourage private investment and participation.
Section 6 requires the Department to formulate and promulgate, in consultation with LGUs and tourism stakeholders, rules and regulations governing operation of tourism enterprises, including a national standard for licensing/accreditation/classification prescribing minimum operating quality/efficiency aligned with recognized international standards, imposing reasonable penalties for violation, and recommending suspension or prohibition to concerned LGUs.
Section 6 requires monitoring of LGU compliance in licensing tourism enterprises, investigation of complaints, and acting on complaints to implement the Act; it also requires coordination with LGUs on local tourism development plans with national priorities.
Section 6 provides that the Department shall: give technical assistance to LGUs for destination development and regulatory enforcement; undertake research and compile an integrated statistical databank; delegate specific powers to regional offices in coordination with LGUs; collect necessary fees and charges for implementation; and exercise other necessary powers.
Sections 7–24 establish internal Department structure and functions: Section 7 creates the organizational components (Department Proper, offices/services/units, regional and foreign offices); Sections 8–10 establish the Department Proper and define the responsibilities of at least three (3) Undersecretaries (Tourism Development; Tourism Regulation, Coordination and Resource Generation; and Special Concerns and Administration).
Sections 11–15 define specialized offices: Product Development (conceptualize new products, viability tests, joint undertakings); Tourism Development Planning, Research and Information Management (national tourism development plan, approve LGU tourism plans, monitoring/evaluation, integrated marketing plan, TEZ development plan formulation in coordination with TIEZA, research/data dissemination, socioeconomic impact analysis, technical assistance, coordination with stakeholders, sourcing grants/loans, managing information systems, and pursuing international cooperation); Industry Manpower Development (seminars and training modules, continuing education, apprenticeship for tourist guides and workers, enlist experts, technical assistance, training, education, and certifications); Tourism Standards and Regulations (standards, accreditation system—mandatory for primary and voluntary for secondary—registration/linkage system among accredited enterprises, project evaluation for incentives, and technical assistance); and Tourism Coordination (coordination with agencies/LGUs/NGOs/private entities and support for governmental coordination needs of the private sector).
Section 16 establishes the Office of Tourism Resource Generation to collect fees and charges used for promotion/marketing by TPB and development of TIEZA infrastructure utilities and services, with proceeds accruing directly and automatically to the Department; it creates the Tourism Development Fund as a special fund sourced from those fees/charges, administered and disbursed by the Department under standard accounting and budgeting rules, and kept in a special account in the National Treasury.
Sections 17–18 require regional offices in each administrative region and retain foreign offices.
Sections 19–24 create functional units: Office of Special Concerns to coordinate/monitor presidential directives; Financial and Management Service, Administrative Affairs Service, Legal Affairs Service, Internal Audit Service, and Legislative Liaison Unit.

Reorganization and attached agencies

Section 25 reorganizes the Philippine Tourism Authority into the Tourism Infrastructure and Enterprise Zone Authority (TIEZA) and reorganizes the Philippine Conventions and Visitors Corporation into the Tourism Promotions Board (TPB); it also absorbs specified Department promotions/information bureaus into the TPB.
Section 26 provides that where functions are redundant due to reorganization, affected employees must be reassigned insofar as practicable without loss of seniority or other rights/privileges, and relevant laws governing government employee rights in reorganization must be respected.
Section 27 provides no mandatory separation from reorganization; if an employee elects to leave or retire, the employee is entitled to separation or retirement benefits under existing civil service or other laws/issuances, whichever is more beneficial.
Section 28 attaches TPB, TIEZA, and DFPC to the Department under the Secretary for program and policy coordination; it also attaches IA, NPDC (created under Executive Order No. 30 (1963)), NPF (created under Presidential Decree No. 37 (1972), as amended), PRA, and the Philippine Commission on Sports Scuba Diving (PCSSD).
Section 28 preserves the continued operation of each attached agency/corporation under its own charter unless otherwise provided.
Section 29 keeps IA, NPDC, and NPF attached and operating under their charters and allows them to operate TEZs under TIEZA supervision within their jurisdictions; it also grants a tax deduction equivalent to the full cost of restoration activity directly incurred by IA/NPDC/NPF under the National Internal Revenue Code, as amended.
Section 30 attaches PRA for policy/program coordination under the Secretary’s supervision and makes the Secretary ex officio Chairperson of the PRA Board of Trustees, applying after the incumbent Chairperson’s term ends.
Section 31 attaches PCSSD for supervision by the Secretary ex officio Chairperson, and assigns it measures to provide standard basic dive rules, regulate scuba sports and technical diving, ensure safety through policy formulation in coordination with the Office of Tourism Standards and Regulations, including regulation of accredited dive establishments.

Control of overlapping tourism jurisdictions

Section 32 provides that any tourism area/zone/spot defined under special or general law, decree, or presidential issuance shall, as far as practicable, be organized into a TEZ under the Act.
Section 32 allows tourism zones/areas/spots not organized into TEZs to have control transferred to another government agency/office or to an LGU only upon submission of a comprehensive development plan within a reasonable time and approval by the Department.
Section 32 provides that transfer of control does not diminish the Department’s jurisdiction over the zones/areas/spots.
Section 32 requires Department supervision of the transferee agency/office/LGU based on transfer terms and the approved development plan.
Section 32 empowers the Department to rescind the transfer arrangement and regain control when the transferee fails to implement the comprehensive plan approved by the Department.
Section 33 requires the Department, in coordination with DENR, to identify NIPAS areas with ecotourism potentials and cultural heritage value and prepare policies/plans/programs for development, preservation, operation, or conversion into TEZs, subject to the TEZ provisions under Subchapter IV-A.
Section 33 allows ecotourism sites in the National Ecotourism Strategy under Executive Order No. 111 (1999) to be developed into TEZs, with the National Ecotourism Steering Committee responsible for finding the appropriate TEZ operator.
Section 34 requires the Department to coordinate with DPWH and DOTC for a tourism infrastructure program identifying vital access roads, airports, seaports and other infrastructure requirements in identified tourism areas, with DBM and these agencies according priority funding.

Shared responsibilities and reporting duties

Section 35 requires integration and coordination of local and national tourism development plans among the Department, DILG, and LGUs, while respecting local autonomy.
Section 35 obligates the Department to provide financial and technical assistance, training, and capacity-building for LGUs’ tourism plan preparation, implementation, monitoring, statistical data gathering, and enforcement of tourism laws and regulations, prioritizing strategic areas under the national tourism development plan.
Section 35 requires LGUs to ensure implementation of such plans.
Section 35 requires prioritization by the Department, TPB, and TIEZA of promotion and development assistance for LGUs that successfully adopt and implement tourism development plans.
Section 36 requires the Department to continuously update the national tourism development plan in coordination with attached agencies, LGUs, and the private sector.
Section 37 encourages LGUs to use their powers under Republic Act No. 7160 to prepare and implement tourism development plans, enforce standards, and collect statistical data for tourism purposes, and to prepare local plans integrating zoning, land use, infrastructure development, standards for tourism enterprises, and heritage/environment protection to encourage sustainable tourism development.
Section 38 requires all LGUs to provide an inventory of all resources available to the Department for implementing the Act and to periodically report to the Department on tourism plans/program status, tourist arrivals, and tourism enterprises within their jurisdictions.

Accreditation and enforcement of enterprise standards

Section 39 requires the Department to prescribe and regulate standards for operation of the tourism industry to encourage global competitiveness and strengthen data gathering and research, and to facilitate promotion of individual enterprises and the industry.
Section 39 provides that primary tourism enterprises must be periodically required to obtain accreditation from the Department regarding facility quality and service standard.
Section 39 provides that accreditation is voluntary for secondary tourism enterprises.
Section 39 requires the Department to evolve an accreditation standards system aligned with relevant tourism development plans and adherent, insofar as practicable, to internationally recognized standards.
Section 39 requires the Department and LGUs to ensure strict compliance by tourism enterprises with accreditation standards.
Section 39 requires the Office of Tourism Standards and Regulations to act on complaints concerning accredited enterprises and, after notice and hearing, to impose fines and/or to downgrade, suspend, or revoke accreditation for violation.
Section 39 requires the Department to issue tourism advisories for tourism enterprises found to have violated accreditation terms.
Section 39 specifies that a tourism advisory must contain: complete identification of the tourism enterprise; location; registered owner/proprietor and business address; the specific accreditation term(s) violated; and a statement that the advisory is lifted only upon continued compliance.
Section 39 requires tourism enterprises registered with TIEZA and availing incentives under the Act, when found violating accreditation terms, to pay back taxes equal to the difference between taxes that should have been paid without incentives and the actual taxes paid under the incentive scheme.
Section 39 mandates computation of back taxes up to three (3) years directly preceding the date of promulgation of the decision or order finding accreditation violation, with assistance from the Bureau of Internal Revenue to compute accurately.
Section 39 mandates distribution of collected back taxes: one-third to the national government; one-third to the LGUs concerned to be shared equally among them if more than one; and one-third to the TIEZA.
Section 39 preserves LGU powers under Republic Act No. 7160 on business permits, licenses, and similar requirements, and requires the Department to notify the concerned LGU when an enterprise fails to obtain or loses accreditation so the LGU may act on permits and licenses to operate.
Section 39 allows the Department, under relevant terms and conditions, to delegate enforcement of the accreditation system to LGUs that adopted and successfully implemented their tourism development plans.
Section 39 requires the Department to promulgate implementing rules and regulations to enforce the accreditation provisions under the Department’s powers and functions in Section 6.
Section 40 requires the Department to develop a system enhancing the value of accreditation, and provides that only accredited enterprises are beneficiaries of the Department and attached agencies’ promotional, training and other programs.
Section 40 requires accredited enterprises to give, insofar as practicable, due preference to other accredited enterprises in obtaining relevant services.
Section 40 requires an integrated accreditation system coordination to reduce the regulatory and financial burden on tourism-related enterprises.
Section 41 requires the Department to develop support and training programs for LGU capability to monitor tourism activities and enforce tourism laws/rules in their jurisdictions, with funding shared equitably between the Department and LGUs.
Section 42 requires every province, city or municipality where tourism is a significant industry to have a permanent position for a tourism officer, responsible for preparing, implementing, updating local tourism development plans, enforcing tourism laws/rules/regulations, and coordinating with the Department and attached agencies.
Section 42 requires tourism officer qualification prior to appointment: a relevant bachelor’s degree and at least five (5) years of substantial involvement in the tourism industry; it also authorizes the Department to prescribe other qualifications and require periodic training completion, with powers/functions defined in the Act’s implementing rules and regulations.
Section 43 requires each province, city or municipality where tourism is a significant industry to establish, in coordination with the Department’s regional offices, a tourist information and assistance center for assistance to tourists and tourism enterprises.
Section 44 requires tourism councils established in administrative regions to meet regularly to classify and evaluate tourism destinations, sites and activities within their regions, and allows such classifications to guide the Department, attached agencies, LGUs, and the private sector.

Tourism Promotions Board creation and powers

Section 45 creates the Tourism Promotions Board (TPB) as a body corporate under the supervision of the Secretary and attached to the Department for program/policy coordination.
Section 45 requires the TPB to formulate and implement an integrated domestic and international promotions and marketing program for the Department.
Section 46 makes the TPB responsible for marketing and promoting the Philippines domestically and internationally as a major global tourism destination to increase tourist arrivals and tourism investment.
Section 46 requires the TPB to market the Philippines as a major convention destination in Asia and to take charge of attracting, promoting, facilitating and servicing large-scale events, international fairs and conventions, congresses, sports competitions, expositions and similar events.
Section 46 requires the TPB to ensure regular advertisement abroad of the Philippines as a major tourism destination and other tourism products, not limited to TEZs.
Section 46 authorizes the TPB to provide incentives to travel agencies abroad that draw tourists and tourism investments.
Section 47 provides TPB governance by a Board of Directors consisting of: the Department Secretary (Chairperson); TPB Chief Operating Officer (Vice Chairperson); TIEZA Chief Operating Officer; DFA Secretary; DTI; DOTC; and five (5) representative directors appointed by the President upon recommendation of the Tourism Congress from lists of at least three (3) nominees per group under Section 49; the Chairperson has voting rights in case of a tie.
Section 47 requires representative directors to be Filipinos with recognized competence in business management, marketing, finance, tourism and other related fields, serving three (3) years term extendable for not exceeding three (3) years.
Section 47 requires DFA, DTI and DOTC Secretaries to each designate a permanent representative authorized to act in the absence of the Secretary.
Section 47 requires the Board to appoint a corporate secretary to prepare board meeting agendas in consultation with the Chairperson.
Section 48 requires the TPB to have a Chief Operating Officer who must be Filipino, hold a bachelor’s degree in specified fields (business, law, tourism, public administration or other relevant fields), have managerial expertise for at least five (5) years, be elected by the Board from qualified applicants, appointed by the Secretary, and serve six (6) years unless removed for cause in accordance with law.
Section 49 requires the Tourism Congress to elect representative directors from designated tourism industry groups and requires replacement for an unexpired term if the representative director ceases to be connected with the sector represented.
Section 50 grants the TPB corporate powers and specific functions, including organizing the TPB for efficient and economical operations; developing and implementing a marketing plan; coordinating government and private resources; promoting the Philippines for international meetings/incentives/conventions/exhibitions/sports/medical tourism and special events; and engaging in tourism-related business acts such as attending events abroad, sales promotions, advertising, and implementing country-promotion programs.
Section 50 authorizes the TPB to: contract loans/indebtedness/credit and issue commercial papers and bonds in local or convertible foreign currency under lawful terms; execute deeds of guarantee/mortgage/pledge/trust/assignment for financing programs subject to constitutional limits; receive donations/grants/bequests/assistance; extend loans through government banks and financial institutions and provide grants and other financial assistance for manpower training, heritage preservation, infrastructure development and other Department programs; and obtain local/foreign consultants and enter contracts, and perform all other corporate powers.
Section 51 mandates Board meetings at least once a month at TPB’s principal office unless written agreement to meet elsewhere exists.
Section 52 sets TPB authorized capital at PHP 250,000,000.00, fully subscribed by the national government.
Section 53 requires the TPB to draft comprehensive short-, medium- and long-term marketing plans, approve them through the Tourism Board, ensure implementation through the Chief Operating Officer, and require periodic reporting and coordination with agencies/private sector for their respective duties.
Section 54 creates the Tourism Promotions Trust by establishing an audit by the Commission on Audit within one hundred and twenty (120) days from effectivity to determine the true value of PTA assets and liabilities.
Section 54 provides that after the audit, TIEZA and the Department in coordination with the Privatization Council determine which PTA assets are for sale or lease, with interested LGUs having right of first refusal.
Section 54 protects specified PTA heritage assets (including Banaue Hotel and similar assets) by requiring they shall not be sold or disposed of and shall be placed under the ownership of the TIEZA for continued maintenance.
Section 54 provides the Tourism Promotions Trust shall be managed by a government-owned bank or financial institution selected by the Tourism Board, and requires quarterly status and profitability reporting to the Tourism Board, the Secretary, and the Joint Congressional Tourism Oversight Committee created under the Act.
Section 55 establishes the Tourism Promotions Fund as a special fund to finance TPB activities using proceeds from: investment earnings from the Tourism Promotions Trust; annual national government appropriation of not less than PHP 500,000,000.00 for at least five (5) years from constitution; seventy percent (70%) of the fifty percent (50%) net income of DFPC accruing to the Department in lieu of its statutory remittance under Republic Act No. 7656; at least twenty-five percent (25%) of the fifty percent (50%) national government share remitted by PAGCOR under Republic Act No. 7656; and at least twenty-five percent (25%) of the national government share remitted by international airports and seaports to the National Treasury under Republic Act No. 7656.
Section 55 requires that promotions and marketing activities receive no less than fifty percent (50%) of annual fund utilization.
Section 55 limits TPB’s other administrative and operating expenses to not more than ten percent (10%) of the fund.
Section 55 requires that unallocated fund portions be earmarked by the TPB for use by TIEZA in TEZ development; for the Department to enhance development planning, heritage preservation, infrastructure development, and manpower training (including scholarships for trainings abroad); or for other purposes that contribute to tourism industry development.
Section 55 requires portions of net income due to TPB from government corporations and other enterprises under the section to be remitted directly to the TPB on a quarterly basis.
Section 56 requires ten percent (10%) of the annual allocation for promotions and marketing at the beginning of each year to be set aside as a Special Contingency Fund for emergencies requiring sufficient resources for marketing and promotions to sustain tourism interest and address adverse effects of emergencies.
Section 57 provides TPB is exempt from corporate income tax notwithstanding contrary provisions in existing laws, decrees, executive orders, under the National Internal Revenue Code (NIRC) of 1997, as amended.
Section 58 opens TPB membership to entities, groups and individuals with economic, social or cultural interest in travel trade, congresses and conventions.

Tourism Enterprise Zones (TEZ) framework

Section 60 defines a Tourism Enterprise Zone (TEZ) as any geographic area meeting requirements including: defining into one contiguous territory; historical/cultural significance, environmental beauty, or existing/potential integrated leisure facilities within bounds or within reasonable distances; strategic access through transportation infrastructure and reasonable connection with utilities systems; sufficient size for new investments in tourism establishments and services; and a strategic location to catalyze socioeconomic development of neighboring communities.
Section 60 further requires that TIEZA designate TEZs upon recommendation of any LGU or private entity or through public-private joint ventures, subject to the Act and to minimum requirements promulgated by TIEZA.
Section 60 restricts TEZ designation by requiring TEZs shall not proliferate in a manner that diminishes their strategic economic and developmental value to the national economy.
Section 61 requires each TEZ application to be accompanied by a development plan identifying tourism focal points and resources; features satisfying TEZ requisites; areas for infrastructure development, investment, and preservation and the kind/nature of allowed development/investment/sustainable activities in preserved areas; medium- and long-term market trend studies and development strategies; economic impact studies; environmental/cultural/social carrying capacity studies; and structure design plans using local architecture and environmental design sustainability principles, plus any other information required by TIEZA.
Section 61 prohibits TEZ designation without both: (1) a development plan duly approved by TIEZA and (2) approval by resolution of the concerned LGU.
Section 61 requires prior TIEZA authorization