INTRODUCED BY THE HONORABLE MAR ROXAS 
E X P L A N A T O R Y  N O T E  
This measure seeks to establish a special economic zone and free port in General Santos 
City and create a General Santos Economic Zone and Freeport Authority to manage and operate 
the zone and port once it is established. 
General Santos is one of the fastest growing cities in the country today and is an 
important political and economic hub in Southern Philippines. The city has been identified as 
one of the Industrial Centers in the region. Because of its proximity to some of the richest fishing 
grounds in the world, it boasts of a thriving fishing industry. The tuna fishing fleet, for instance, 
consists of over 2,500 large buncus (pumpboats), employing over 3,000 fishermen, and 
producing over 30,000 metric tons of high-value tuna annually. 
Thwity and thE-region have been identified as one of the growth areas in agricultural 
production. The city has grown to be a major producer of livestock, particularly cattle and hog, 
and breeding farms can be found across its countryside. The city has abundant mineral deposits 
such as limestone, magnefite iron stand, sulfur, copper nitrate luminate, rutile and guano, which 
remain untapped due to the lack of large scale investment in mining. Sand and gravel can 
likewise be found in large quantities in the city. 
The city also boasts of excellent infrastructure. It has three government ports and four 
private ports. The world-class fish port accords fishing vessels a 750-meter quay, a 300-meter 
wharf for 2,000 GT reffer carriers, and refrigeration facilities consisting of a 1,500 old storage 
capacity, a 60 tondday ice plant, brine, air blast and contact freezers. The intemat‘onal airport 
which sits on a 600-hectare site provides businessmen convenient access to their 
me offices 
and markets abroad. The 3,200 m. runway, which is capable of handling wide-bodie jets, places 
the region’s fresh produce within 3 to 4 hours flying time to almost all the key cities f Asia. 1 
The establishment of a special economic zone and freeport in Genemi Santos City will 
build on General Santos City’s strengths and further promote development in Southem 
Philippines. With the incentives and employment that the establishment of an ecozone and 
Freeport is projected to bring, the city will be further developed as a self-sustaining industrial, 
commercial, financial and investment center. It is envisioned that General Santos City, one of the 
most promising places in the country, will become a magnet for foreign direct investment, 
Finally, the establishment as an ecozone will lay the groundwork for the city’s emergence as the 
one of the hubs of the envisioned growth area in the Eastern ASEAN region. 
In view of the foregoing, the immediate approval of this measure is earnestly requested. 


1 
THIRTEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
1 
S E N A T E  
INTRODUCED BY THE HONORABLE MAR ROXAS 
AN ACT 
TO ESTABLISH THE GENERAL SANTOS CITY SPECIAL ECONOMIC ZONE 
AND F m E  PORT IN THE PROVINCE OF SOUTH COTABATO, CREATING FOR 
THIS PURPOSE THE GENERAL SANTOS CITY SPECIAL ECONOMIC ZONE AND 
FREE PORT AUTHORITY, APPROPRIATING FUNDS THEREFOR 
AND FOR OTHER PURPOSES 
Be it enacted bv the Senate and House of Representatives of the Philippines in 
Congress assembled: 
SECTION 1. Short Title. - This Act shall be known as the “General Santos City Special 
Economic Zone Act of 200&” fl 
SEC. 2. 
Declaration of Policy. - It is hereby declared the policy of the State to 
actively encourage, promote, induce and accelerate a sound and balanced industrial, economic 
and social development of the country in order to provide jobs to the people especially those in 
the rural are%,-increase productivity and individual and family income, and thereby improve the 
level and quality of living condition through the establishment, among others, of special 
economic zones in suitable and strategic locations in the country and through measures that will 
attract legitimate and productive foreign investments. 
- 
-- 
SEC. 3. Creation of the General Santos City Special Economic Zone and Free Port. - In 
pursuit of the foregoing declared policy and subject to the concurrence of the concerned local 
government unit of General Santos City affected by the zone, there is hereby establish d a special 
economic zone and free port in General Santos City, Province of South Cotabato to b known as 
the General Santos City Special Economic Zone and Free Port, hereinafter referre to as the 
GenSan ECOZONE. The GenSan ECOZONE shall cover portions of the following barangays: 
San Jose, Fatima, Tambler, Bawing, Calmpang, Sinawal and Apopong in the City of General 
Santos. The specific metes bounds of the GenSan ECOZONE shall be more particularly defined 
in a presidential proclamation that shall be issued for this purpose. 
r 


2 
SEC. 4. Governing-Principles. - The GenSan ECOZONE shall be managed and operated 
by the General Santos City Special Economic Zone Authority, herein referred to as GSEZA, to 
be created under Section 6 of this Act, under the following principles: 
-- 
(a) Within the framework and limitations of the Constitution and applicable provisions of 
the Local Government Code, the GenSan ECOZONE shall be developed into and operated as a 
decentralized, self-reliant and self-sustaining industrial, commercialitrading, agro-industrial, 
tourist, banking, financial and investment center with suitable residential areas. 
(b) The GenSan ECOZONE shall be provided with transportation, telecomrnuni ations and 
other facilities needed to attract legitimate and productive investments, gener te linkage 
industries and employment opportunities for the people of the Province of South Cota at0 and its 
neighboring towns and cities. 
I 
(c) The GenSan ECOZONE may establish mutually beneficial economic relations with 
other entities or enterprises within the country or, subject to the administrative guidance of the 
Department of Foreign Affairs (DFA), the Philippine Economic Zone Authority (PEZA) and/or 
the Department of Trade and Industry (DTI), with foreign entities or enterprises. 
(d) Foreign citizens and companies owned by non-Filipinos in whatever proportion may set 
up enterprises in the GenSan ECOZONE, either by themselves or in joint venture with Filipinos 
in any sector of industry, international trade and commerce within the GenSan ECOZONE. 
(e) The GenSan ECOZONE shall be managed and operated as a separate customs territory 
ensuring free flow or movement of goods and capital within, into and exported out of the GenSan 
ECOZONE, as well as provide incentives such as tax and duty-free importations of raw 
materials, capital and equipment. However, exportation or removal of goods from the territory of 
the GenSan ECOZONE to the other parts of the Philippine territory shall be subject to customs 
duties and taxes under the Tariff and Customs Code of the Philippines, as amended, and the 
National Internal Revenue Code of 1997, as amended. 
(0 The areas comprising the GenSan ECOZONE may be expanded or reduced when 
necessary. For this purpose, the GSEZA, in consultation with the local government units, shall 
have the pwer to acquire either by purchase, negotiation or condemnation proceedings, any 
private lands within or adjacent to the GenSan ECOZONE for the following purposes: (1) 
consolidation of lands for GenSan ECOZONE development; (2) acquisition of right of way to the 
GenSan ECOZONE; and (3) the protection of watershed areas and natural assets valuable to the 
prosperity of the GenSan ECOZONE. 
(g) Goods manufactured by a GenSan ECOZONE enterprise shall be made available for 
immediate retail sale in the domestic market, subject to the payment of 
raw materials and other regulations that may be formulated by the 
PEZA, the Bureau of Customs and the DTI. However, in order to 
there shall be a negative list of industries that will be drawn up 
Enterprises engaged in industries included in such negative list shall not be allowed to sell their 
products locally. 


3 
Immigration. Working visas renewable every two (2) years shall be issued to foreign 
and foreign technicians with highly specialized skills, which no Filipino possesses, as 
the Department of Labor and Employment. 
The foregoing is without prejudice to a foreigner acquiring permanent resident 
executives 
certified by 
s:atus in the 


4 
ECOZONE: Provided, however, That such foreign investments in said enterprises have been 
previously registered with the BSP. 
SEC. 6. Creation of the General Santos City Special Economic Zone and Free Port 
Authority. - There is hereby created a body corporate to be known as the General Santos City 
Special Economic Zone and Free Port Authority, herein referred to as the GSEZA which shall 
manage and operate the GenSan ECOZONE, in accordance with the provisions of this Act. This 
corporate franchise shall expire in fifty (50) years counted from the first year after the effectivity 
of this Act, unless otherwise extended by Congress. It shall be organized within one hundred 
eighty (18O)days after theeffectivity of this Act. 
SEC. 7. Principar Office. - The GSEZA shall maintain its principal office in General 
Santos City but it may establish branches within the Philippines and abroad as may be necessary 
for the proper conduct of its business. 
SEC. 8. Powers and Functions of the GSEZA. - The GSEZA shall have the following 
functions: 
(a) To operate, administer, manage and develop the GenSan ECOZONE according to the 
(b) To recommend to the President the issuance of a proclamation to fix and deli it the site 
I 
principles and provisions set forth in this Act; 
of the GenSan ECOZONE; 
(c) To register, regulate and supervise the enterprises in the GenSan ECOZ NE in an 
efficient and decentralized manner, subject to existing laws; 
(d) To coordinate with local government units and exercise general supervision over the 
development plans, activities and operations of the GenSan ECOZONE; 
(e) To regulate and undertake the establishment, operation and maintenance of utilities, 
other services and infrastructure in the GenSan ECOZONE such as but not limited to heat, light 
and power, water supply, telecommunications, transport, toll roads and bridges, port services, etc. 
and to fix just, reasonable and competitive rates, fares, charges and prices thereof; 
(9 To construct, acquire, own, lease, operate and maintain on its own or through contracts, 
franchises, licenses, bulk purchase from the private sector or permits under any of the schemes 
allowed in Republic Act No. 6957 (the Build-Operate-Transfer Law, as amended by Republic 
Act No. 7718), or joint venture, adequate facilities and infrastructure required or needed for the 
operation and development of the GenSan ECOZONE, in coordination with appropriate national 
and local government authorities and in conformity with applicable laws thereon; 
(8) To operate on its own, either directly or through a license to other tourism-related 
activities, including games, amusements, recreational and sports facilities; 
(h) Subject to the approval of the President and the Monetary Board of the Bangko Sentral 
ng Pilipinas-npon the re&nmendation of the Department of Finance, to raise or borrow adequate 
and necessary funds from local or foreign sources to finance its projects and programs under this 
Act, and for that purpose, to issue bonds, promissoly notes, and other forms of securities, and to 


5 
secure the same by a guarantee, pledge, mortgage, deed of trust, or an assignment of all or part of 
its property or assets; 
(i) To provide security for the GenSan ECOZONE in coordination with the national and 
local governments. Militmy forces sent by the national government for the purpose of defense 
shall not interfere in the internal affairs of the GenSan ECOZONE and expenditures for these 
military forces shall be borne by the national government. For this purpose, the GSEZA may 
establish and maintain its security forces and firefighting capability or hire others to provide the 
same; 
6 )  To protect, preserve, maintain and develop the virgin forests, beaches, coral and coral 
reefs, and maintain ecological balance within the GenSan ECOZONE; 
(k) To create, operate andor contract to operate such functional units or offices of the 
GSEZA as it may deem necessary; 
(1) To-adopt, alterand use a corporate seal; make contracts, leases, own, or otherwise 
dispose of personal or real property; sue and be sued; and otherwise carry out its functions and 
duties as provided for in this Act; 
(m) To issue certificates of origin for products manufactured or processed in the GenSan 
ECOZONE in accordance with prevailing rules of origin, and the pertinent regulations of the 
PEZA, DTI and/or the Department of Finance (DoF); 
(n) To issue working visas renewable every two (2) years to foreign executives id foreign 
technicians with highly specialized skills which no Filipino possesses, as certi ed by the 
Department of Labor and Employment; 
(0) To report to the Bureau of Immigration the names of the foreigners who have been 
granted permanent resident status and working visas within thirty (30) days after issuance of such 
grant; 
1 
(p) To exercise such powers as may be essential, necessary or incidental to the powers 
granted to it hereunder as well as those that shall enable it to carry out, implement and 
accomplish the purposes, objectives and policies of this Act; and 
(q) To issue rules and regulations consistent with the provisions of this Act as may be 
necessary to accomplish and implement the purposes, objectives and policies provided herein. 
SEC. 9. Exemptionsfrom Taxes, Duties and Other Fees. - The GSEZA is hereby declared 
exempt from the payment of all taxes, duties, fees, imposts, charges, costs and service fees in any 
court or administrative proceedings in which it may be a party. 
The foregoing exemptions may, however, be entirely or partially lifted by the President of 
the Philippines upon the recommendation of the Secretary of Finance, not earlier than five (5) 
years from the effectivity of this Act, if the President shall find the GSEZA to be self-sustaining 
and financially capable by then to pay such taxes, customs duties, fees and other charges after 
providing for debt service requirements of the GSEZA and of its projected capital and operating 
expenditures. 


6 
SEC. 10. Board of Directors of the GSEZA. - The powers of the GSEZA shall be vested in 
and exercised by a Board of Directors, hereinafter referred to as the Board, which shall be 
composed of the following: 
(a) The chairman who shall, at the same time be the administrator of the GSEZA; 
(b) A vice chairman who shall come from among the members of the Board; 
(c) Members consisting of: 
(1) The Congressional Representative of the district covering the site of the GenSan 
ECOZONE; 
(2) The mayor of the City of General Santos; 
(3) One (I) representative from the domestic investors; 
(4) One (1) representative from the foreign investors; and 
(5) Two (2) representatives from the workers working in GenSan ECOZONE. 
The Congressional representative and the mayor of the City of General Santos shall serve as 
ex oflcjo members of the Board, whose term in the Board corresponds to their terms as elected 
officials. 
The Chairman and the members of the Board, except the ex officio members, shall be 
appointed bythe PresidGgt of the Philippines to serve for a term of six (6) years, unless sooner 
removed for cause or dies or resigns voluntarily. In case of death, resignation or removal for 
cause, the replacement shall serve only the unused portion of the term. 
Except for the representatives of the business and labor sectors, no person shall be 
appointed by the President of the Philippines as a member of the Board unless he is a Filipino 
citizen, of good moral character, of proven probity and integrity, and a degree-holder in any of 
the following fields: economics, business, public administration, law, manageme t or their 
equivalent, and with at least ten (10) years relevant working experience preferably in he field of 
management or public administration. 
The members of the Board shall each receive per diem at rates to be determ' ed'by the 
Department of Budget and Management in accordance with existing rules and regulations: 
Provided, however, That the total per diem collected each month shall not exceed the equivalent 
per diem for four (4) meetings. Unless and until the President of the Philippines has fixed a 
higher per diem for the members of the board, such per diem shall not be more than Ten 
thousand pesos (Pl0,OOO.OO) for every board meeting. 
I 
SEC. 11. Powers and Duties of the Chairman-Administrator. - The chairman-administrator 
shall have the following powers and duties: 
(a) To direct and manage the affairs of the GSEZA in accordance with the policies of the 
Board; 
(b) To establish the internal organization of the GSEZA under the conditions that the Board 
may prescribe; 
(c) To submit an annual budget and necessary supplemental budget to the Board for its 
approval; 


' 
(d) To submit within thirty (30) days after the close of each fiscal year an annu report to 
(e) To submit to the Board for its approval policies, systems, procedures, rules and 
t 
the Board and such other reports as may be required; 
regulations that are essential to the operation of the GenSan ECOZONE; 
(0 To create a mechanism in coordination with relevant agencies for the promotion of 
industrial peace, the protection of the environment, and the advancement of the quality of life in 
the GenSan ECOZONE; and 
(g) To perform such other duties as may be assigned to him by the Board or which are 
necessary or incidental to his office. 
SEC. 12.Personnel. - The Board of Directors of the GSEZA shall provide for an 
organization and staff of its officers and employees. Upon recommendation of the chairman- 
administrator and with the approval ofthe Secretary of the Department of Trade and Industry, the 
Board shall appoint and fix the remuneration and other emoluments of its officers and employees 
in accordance with existing laws on compensation and position classification: Provided, That the 
Board shall have exclusive and final authority to promote, transfer, assign or reassign officers of 
the GSEZA, any provision of existing law to the contrary notwithstanding: Provided, further, 
That the chairman-administrator may carry out removal of such officers and employees. 
The officers and employees of the GSEZA, including all members of the Board, shall not 
engage directly or indirectly in partisan activities, nor take part in any election, except to vote. 
No officer or employee of the GSEZA, subject to Civil Service laws and regulations, shall 
- 
.- 
be removed i r  suspended except for cause, as provided by law. 
SEC. 13.Applicability Clause. - The provisions of Sections 30-42 of Republic Act No. 
7916, as amended, shall apply to the GenSan ECOZONE. 
SEC.14.Capitalization - The GSEZA shall have an authorized capital stock of two billion 
(2,000,000,000) no par-shares with a minimum issue of Ten pesos (P10.00) each, the majority 
shares of which shall be subscribed and paid for by the national government and the local 
government units (LGUs) embracing the GenSan ECOZONE. The Board of Direc ors of the 
GSEZA with the written concurrence of the Secretary of Finance may sell shares, r presenting 
not more than forty per centurn (40%) of the capital stock of the GSEZA to the ge era1 public 
under such policy as the Board and the Secretary of Finance may determine. T e national 
government and the LGUs shall in no case own less than sixty per centum (60%) of the total 
issued and outstanding capital of the GSEZA. 
i 
The amount necessary to subscribe and pay for the shares of the national government to the 
capital stock of the GSEZA shall be included in the annual General Appropriations Act. For 
LGUs, the funds shall be taken from their internal revenue allotment and other local funds. 
SEC. 15. Supervision and Coordination of Development Plans. - For purposes of policy 
direction and coordination, the GenSan ECOZONE shall be under the direct control and 
supervision of the Office of the President. 


8 
SEC. 16. Relationship with the Regional Development Council. - The GSEZA shall 
determine the development goals for the GenSan ECOZONE within the framework of national 
development plans, policies and goals. The Administrator shall, upon approval by the Board, 
submit the GenSan ECOZONE plans, programs and projects to the Regional D velopment 
Council for inclusion and inputs to the overall regional development plan. 
SEC. 17. Relationship with Local Government Units. - Except as herein pr vided, the 
LGUs comprising the GenSan ECOZONE shall retain their basic autonomy and ide tity. The 
City of General Santos shall operate and function in accordance with the Local Government 
Code of 1991. In case of any conflict between the GSEZA and the City of General Santos on 
matters affecting the GenSan ECOZONE other than defense and security matters, the decision of 
the GSEZA shall prevail. 
1 
SEC. 18. InterpretutiodConstruction. - The powers, authorities and functions that are 
vested in the GSEZA are intended to establish decentralization of governmental functions and 
authority and promote an efficient and effective working relationship between the GenSan 
ECOZONE, the central government and the LGUs. 
SEC. 19.Auditing. - The Commission on Audit shall appoint a representative who shall be 
a full time auditor of the GSEZA and assign such number of personnel as may be necessary to 
assist said representative in the performance of hisher duties. The salaries and emoluments of 
the assigned auditor and personnel shall be in accordance with pertinent laws, rules and 
regulations. 
SEC. 20. Separability Clause. - If any provisions of this Act shall be held unconstitutional 
or invalid, the other provisions not otherwise affected shall remain in full force and effect. 
SEC. 21. Repealing Clause. - All laws, executive orders or issuances, or any parts thereof, 
which are inconsistent herewith 
.- 
are hereby repealed or amended accordingly. 
-. . 
SEC. 22Effectivity Clause. -This Act shall take effect upon its publication in at least one 
(1) newspaper of general circulation. 
Approved, 
/JEM04