RESTRICTED  
  
S/C/W/438  
 
8 June 2023 
(23-3938) Page: 1/2 
Council for Trade in Services  Original: English  
 
  
COMMUN ICATION FROM THE PHILIPPINES  
REVIEW OF ARTICLE II (MFN) EXEMPTIONS  
Written answers by  the Philippines to the questions from the Republic of Korea  (S/C/W/ 431) 
The following communication  dated 7 June 2023, from the delegation of the Philippines is being 
circulated to the Members of the Council for Trade in Services.  
 
_______________  
 
 
1  QUESTION 23 FROM THE REPUBLIC OF KOREA  
Regarding the MFN exemption measure "A special visa category is provided for traders  and investors 
of countries with which the Philippines has concluded treaties on entry rights for traders and 
investors. Under this special category, the labor market test is waived and simplified entry 
procedures are provided.", please confirm if the exem ption measure pertains to measures affecting 
natural persons seeking access to the employment market, which are carved out by paragraph 2 of 
Annex on Movement of Natural Persons Supplying Services under the Agreement, irrespective of the 
period of stay.  
 
Answer from the Philippines:  
Currently, the Bureau of Immigration issues a specific visa intended for traders and investors, which 
is the Treaty Trader's Visa of the 9(d) visa. This visa, however, only covers investors from Germany, 
Japan and USA under ex isting bilateral arrangements.  
 
The Board of Investment also issues a special visa to investors known as the Special Investor's 
Resident Visa (SIRV). A foreign national who is qualified for a 9(d) and SIRV visa is not required to 
secure an Alien Employment  Permit (AEP) from DOLE prior to its issuance and is no longer a labor 
market test.  
 
However, should said visa holders be engaged in gainful employment in the country, an AEP or 
Certificate of Exclusion (CoEx), whichever is applicable, shall be secured fro m the Department of 
Labor and Employment, subject to existing rules and guidelines indicated in the Department Order 
No. 221, series of 2021, or the Rules and Regulations for the Issuance of Employment Permits to 
Foreign Nationals.  
 
2  QUESTION 115 FROM THE R EPUBLIC OF KOREA   
Regarding the reciprocity -based MFN exemption measure under commercial banking, "Authorization 
for financial service suppliers of another Member to establish commercial presence in commercial 
banking shall be subject to a reciprocity test .", we wonder whether this exemption is based on any 
international agreements.  
 S/C/W/438  
 
- 2 - 
 
  Answer from the Philippines:  
No, the exemption was mainly based on the Philippines’ domestic laws. Specifically, Section 73 of 
Republic Act No. 87911 provides the legal basis  for the equal treatment or reciprocity rights to be 
accorded between foreign banks or their subsidiaries or affiliates and domestic banks, which states, 
in part, that "Any right, privilege or incentive granted to a foreign bank under this Section shall be  
equally enjoyed by and extended under the same conditions to banks organized under the laws of 
the Republic of the Philippines (Secs 2 and 3, RA 7721) ". 
 
Section 3 of Republic Act No. 77212, as amended by Republic Act No. 106413, provides the factors 
to be considered by the Monetary Board in selecting foreign banks that will be allowed entry in the 
Philippine Banking system, which include among others, the guarantee that reciprocity rights are 
enjoyed by the Philippine banks in the applicant’s country.  
 
To implement the abovementioned laws and support the principle of reciprocity that the Philippines 
adheres to, Section 103 of the Manual of Regulations for Banks (MORB) provides the rules governing 
the liberalized entry and scope of operations of foreign b anks in the Philippines. Subject to the host 
country’s rules and regulations of general application, the Philippine banks should have the 
opportunity to establish operations in the foreign bank applicant’s home country.  
 
In ensuring equal treatment, Secti on 103 of the MORB further states that "Any right, privilege or 
incentive granted to foreign banks or their subsidiaries or affiliates under R.A. No. 7721, as amended 
by R.A. No. 10641 shall be equally enjoyed by, and extended under the same conditions, to  domestic 
banks. " 
 
In the same manner, foreign banks authorized to operate in the Philippines shall perform the same 
functions, enjoy the same privileges, and be subject to the same limitations imposed upon a 
Philippine bank of the same category.  
 
 
_______ ___ 
 
1 Entitled: “The General Banking Law of 2000”  
2 Entitled: “An Act Liberalizing the Entry and Scope of Operations of Foreign Banks in the Philippines and 
for Other Purposes”  
3 Entitled: “An Act Allowing the Full Entry of Foreign Banks in the Philippines, Amending for the Purpose 
Republic Act No. 7721”