16 CONGRESS OF THE REPUBLIC OF THE PHILIPPINES
FIRST REGULAR SESSION

House of Representativg
HOUSE BILL NO. 7369

INTRODUCED BY HONORABLE GUS S. TAMBUNTING

EXPLANATORY NOTE

It is provided under Article Il, Section 20 of the Declaration of Principles of the 1987
Philippine Constitution that the State recognizes the indispensable role of the private
sector, encourages private enterprise, and provides incentives to needed investments.

This piece of legislation seeks to balance and correct the influx of incentives to dormant
industry or sector. This bill intends to make best use of incentive provisions to encourage
investments and create a more harmonious and progressive local and foreign business
economy.

The Philippine economy as reported by Moody's is likely to grow the fastest in Asia. The
International Monetary Fund raised its 2014 economic growth forecast for the Philippines
to 6.5 percent.

The passage of this bill will provide for the impetus in creating a balance between the
current advantage of the Philippines as fertile investment hub and a more responsive
incentive provisions of industry and sector specific and investments and incentives laws.

Hence, approval of this-measure is earnestly sought.



16TH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES
FIRST REGULAR SESSION

HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 6

Introduced by HONORABLE GUS S. TAMBUNTING

AN ACT
REPEALING THE INCENTIVE PROVISIONS OF INDUSTRY AND SECTOR
SPECIFIC AND INVESTMENTS AND INCENTIVES RELATED LAWS, AND FOR
OTHER PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress as
assembled:

Section 1. Title. This Act shall be known as the “Repeal of Investment Incentives Laws”.

Sec. 2. Declaration of Policy. It is the policy of the State to encourage investments to accelerate
the sound development of the national economy through, among others, a cohesive investment
incentives regime that is clear, consistent, competitive and simple to administer for the guidance
of domestic and foreign investors.

Accordingly, amendment of the incentive provisions of industries, sectors and investment related
laws is required for a unified and strategic approach in the great incentives.

See. 3. The provisions pertaining to incentives of the following laws are hereby repealed:

a. Sections 83, 90, 91 and 93 of Republic Act No. 7942, otherwise known as the “Philippine
Mining Act of 1995”;

b. Section 9 of Republic Act No. 8479, otherwise known as the “Downstream Oil
Deregulation Act of 1998”;


. Section 45 of Republic Act No. 9003 otherwise known as the “Ecological Solid Waste
Management Act of 2007”;

|. Section 36 (f) of Presidential Decree No. 705, also known as the “Revised Forestry Code

of the Philippines”;
. Section 26 Republic Act No. 9275, otherwise known as “The Philippine Clean Water Act
of 2004”;
Section 12 of Republic Act No. 8047, also known as the “Book Publishing Industry
Development Act of the Philippines”;

. Sections 15 to 26 of Republic Act No. 9513, otherwise known as the “Renewable Energy
Act of 2008”;

. Sections 16 and 17 of Presidential Decree No. 972, also known as the “Coal Development
Act of 1976”;
Sections 16 and 17 of Presidential Decree No. 1442 entitled “An Act to promote the
Exploration and Development of Geothermal Resources”;
Sections 6 and 7 of Republic Act No. 7156, otherwise known as the “ Iron and Steel
Industry Act”;

. Sections 10 and 11 of Republic Act No. 7156, otherwise known as the “Mini-hydroelectric
Power Incentive Act”;

Sections 19 and 20 of Republic Act No. 7279, otherwise known as the “Urban
Development and Housing Act of 1992”;
. Section 2 of Republic Act No. 9301, entitled “An Act Amending Republic Act No. 7471,
entitled An Act to Promote the Development of Philippine Overseas Shipping, and for
other Purposes”;
. Sections 1, 2, 3 and 4 of Republic Act No. 7109 entitled “An Act Granting Privileges to
Local Water Districts”;

. Section 18 of Republic Act No. 7884, entitled “National Dairy Development Act of 1995”;

. Section 1 of Republic Act No. 9281 entitled “An Act to Strengthen Agriculture and
Fisheries Modernization in the Philippines by Extending the Effectivity of Tax Incentives
and its Mandated Funding Support, Amending for this Purpose Sections 109 and 112 of
Republic Act No. 8435”;

|. Section 3 of Republic Act No. 9290, also known as the “"Footwear, Leather Goods and
Tannery Industries Development Act”;
Section 4 of Republic Act No. 9295, also known as the “ Domestic Shipping Development
Act of 2004”;

. Section 14 of Republic Act No. 7308, also known as the “Seed Industry Development Act
of 1992”;
Section 9 (e), (1), and (i) of Republic Act No. 7900 also known as the “High Value Crops
Development Act of 1995”;

. Section 35 (b), (©), (d) of Republic Act 8550, also known as “The Philippine Fisheries
Code of 1998”;

Section 3 of Republic Act 8502, otherwise known as the “Jewelry Industry Development
Act of 1998”;


w. Section 14 (a) of Republic Act 7076, also known as the “People’s Small Scale Mining Act
of 1991”;

x. Section 24 of Republic Act No. 10068, also known as the “Organic Agriculture Act of
2010";

y. Section 23 of Republic Act No. 7925, also known as the “Public Telecommunications
Policy Act of the Philippines”; and

z. Section 12 of Republic Act No. 7718, entitled “An Act Amending Certain sections of
Republic Act No. 6957, Entitled An Act Authorizing the Financing, Construction,
Operation and Maintenance of Infrastructure Projects by the Private Sector, and for Other
Purposes”.

Sec. 4. Investments Priorities Plan (IPP). The Board of Investments (BOI) created and existing
under Executive Order No. 226, upon consultation with the Office of the President, concerned
IPAs and appropriate government agencies and the private sector, shall formulate an IPP to be
submitted to the President for his approval, which shall be valid for a period of three (3) years.

In the listing of the activity in the IPP, the following shall be complied with:

1) The activity shall be covered by the current Medium Term Philippine Development Plan
(MTPDP) and Medium Term Philippine Investment Plan (MTPIP) or its equivalent;

2) The activity shall satisfy the following conditions:
a. Substantial amount of investments;

b. Considerable generation of employment;

c. Use of modern or new technology;

d. Installation of adequate environmental protection systems;

Provided, That items 2 (a) and 2 (d) above shall be present in all activities, and the threshold
amount of investments and employment generation required for a specific activity shall be subject
to a periodic review every three (3) years taking into consideration international standards and
other indicators.

3) The activity must comply with the specific qualification requirements and/or conditions
for a particular sector or industry, as set by the BOI and other limitations it may determine.

SEC. 5, Amendments, Subject to publication requirements and the criteria for investment priority
determination, the BOI may, at any time, include additional areas in the IPP, alter any of the terms
of the declaration of an investment area, and temporarily or permanently suspend activities on the
IPP if it considers that such activity is no longer a priority. In no case, however, shall any
amendment of the IPP impair the incentives conferred on a registered enterprise. The Board shall


not accept applications in an area of investment prior to the approval of the same as a preferred
area or after approval of its deletion as a preferred area of investment in the IPP.

SEC. 6. Publication. Upon approval of the IPP, in whole or in part, or upon approval of an
amendment thereof, the IPP or the amendment, specifying and declaring the areas of investment
shall be published in at least one (1) newspaper of general circulation and all such areas shall be
open for application until publication of an amendment or deletion thereof.

SEC. 7. Vested Right. Notwithstanding any provision of law to the contrary, incentives granted
to existing registered enterprises pursuant to contracts or agreements entered into by government
agencies, instrumentalities, and corporations shall continue to be legally binding in accordance
with the terms and conditions stated in their respective contracts or agreements, as provided under
the laws covered herein.

SEC. 8. Separability Clause. If any portion or provision of this Act is declared unconstitutional,
the remainder of this Act or any provision not affected thereby shall remain in force and effect.

SEC. 9. Repealing Clause. All laws, decrees, orders, proclamations, rules and regulations or
other issuances or parts thereof inconsistent with the provisions of this Act are hereby repealed or
modified accordingly.

SEC. 10. Effectivity. This Act shall take effect fifteen (15) days following its publication in the
Official Gazette or in a newspaper of general circulation, whichever is earlier.

Approved.