eer RESEN

‘ RECEIVED
3 vaTRes 02 2023

Republic of the Philippines
House of Representatives
Quezon City

NINETEENTH CONGRESS
First Regular Session

“House BillNo,_ 7908

Introduced by Representative Albert S. Garcia

EXPLANATORY NOTE

This measure seeks to further amend the charter of the Authority of the Freeport Area
of Bataan (AFAB). AFAB has been instrumental in spurring local economic development in
the Province of Bataan. As one of the leading investment promotion agencies (IPAs) in the
country, it has also substantially contributed to the growth of the Philippine economy.

Its last charter amendment during the 17" Congress has been key to further
strengthening its role as an engine of growth in Bataan and in the Philippines. We are
Proposing further amendments to its charter as a means towards further maximizing its
Potential as a major contributor to the development of the country.

Approval of the measure, then, is eamestly sought for my colleagues.
—

EP -ACBI
cond

‘S. GARCIA
istrict, Bataan


Sowrwraweun =

Republic of the Philippines
House of Representatives
Quezon City
NINETEENTH CONGRESS
First Regular Session

House BillNo.__ 7058

Introduced by Representative Albert S. Garcia

AN ACT
STRENGTHENING FURTHER THE POWERS AND FUNCTIONS OF THE
AUTHORITY OF THE FREEPORT AREA OF BATAAN (AFAB), AMENDING FOR
THE PURPOSE REPUBLIC ACT NO. 9728, OTHERWISE KNOWN AS THE
“FREEPORT AREA OF BATAAN (FAB) ACT OF 2009, AS AMENDED BY
REPUBLIC ACT NO. 11453”

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

SECTION 1. Section 2 of Republic Act No. 9728, as amended, is hereby
amended to read as follows:
“Section 2. Declaration of Policy.

IT IS ALSO DECLARED THAT ALL NON-ECONOMIC AFFAIRS WITHIN THE
FAB AND ITS EXPANSION AREAS BE UNDER THE SOLE AND EXCLUSIVE
MANAGEMENT AND OPERATION OF THE AFAB TO THE EXCLUSION OF
ANY LGU PURSUANT TO ITS AUTONOMY AND SELF-RELIANCE IN
ORDER TO ENSURE ITS INDEPENDENCE AND FREE FROM PROVIDING

A JUST AND DYNAMIC SOCIAL ORDER AND/OR SECURING ANY
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ASSISTANCE OR PARTNERSHIP WITH OTHER AGENCIES AND
INSTRUMENTALITIES OF THE GOVERNMENT.”

Section 2. Section 4 of Republic Act No. 9728, as amended, is hereby

amended to read as follows:

“Section 4. Governing Principles. - The FAB shall be managed and operated
under the following principles:

(a) Within the framework and limitations of the Constitution and
applicable provisions of the Local Government Code, the FAB shall be
developed into and operated as a decentralized, self - reliant and self -
sustaining industrial, commercial - trading, research and development,
engineering, medical, education, information and communications technology
including emerging and future technologies such as artificial technology,
blockchain, business process outsourcing, cloud computing, cybersecurity,
distributed ledger technology, financial technology solutions, SPACE
TECHNOLOGY, internet of things, and virtual reality, retirement and healthcare
services, agro-industrial, and investment center with provision for suitable
residential areas;

(g) The areas comprising the FAB may be expanded or reduced when
necessary. For this purpose, the AFAB, with the concurrence of the appropriate
and affected local government units (LGUs) and the agreement of appropriate
national government agencies, government-owned and _-controlled
corporations and instrumentalities, and UPON approval of the Board in
accordance and in compliance with existing laws andocal-ordinanees shall
have the power to acquire, procure, and/or expand either by purchase,
negotiation, EXPROPRIATION OR condemnation proceedings, or any other
arrangement, any private or alienable and disposable public lands and/or their
respective water territories within the territorial jurisdiction of the Province of
Bataan, if any, for the following purposes:”


FS ce wr das H ek wH

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(i) The defense of the FAB and the security of its perimeter fence shall
be the responsibility of the National Government in coordination with the AFAB
and the LGUs. The AFAB shall provide its own internal security and firefighting
forces. FOR THE PURPOSE OF PUBLIC SAFETY AND SECURITY, LAW
AND ORDER, AND DISASTER RISK REDUCTION MANAGEMENT (DRRM)
AND RESILIENCY, THE AFAB SHALL HAVE ITS OWN INTERNAL POLICE
FORCE, FIREFIGHTING FORCES, AND DRRM OFFICE.

Section 3. Section 7 of Republic Act No. 9728, as amended, is hereby further
amended to read as follows:

“Section 7. Incentive to Investors.- Any foreign national who invests an
amount of Seventy-five thousand US dollars (US$75,000.00), either in cash and/or
equipment, DIRECTLY TO THE AFAB OR in a registered enterprise shall be
entitled to an investor's visa: Provided, that he has the following qualifications:

(a) He is at least eighteen (18) years of age;

(b) He has not been convicted of a crime involving moral turpitude;

(c) He is not afflicted with any loathsome, dangerous or contagious disease;
and

(d) He has not been institutionalized for any mental disorder or disability.

‘As a holder of AN investor's visa, an alien shall be entitled to reside in the
Philippines while his investment subsists. For this purpose, he should
submit an annual report, in the form duly prescribed for the purpose, to
prove that he has maintained his investment in the country, should said alien
withdraw his investments from the Philippines, then the investor's visa
issued to him shall automatically expire.”

Section 4. Section 13 of Republic Act No. 9728, as amended, is hereby further
amended and to read as follows:


“SEC. 13. Powers and Functions of AFAB. The AFAB shall have the
following functions:

“(a) To adopt, alter, use a corporate seal, to contract, lease, buy,
sell, acquire, own and dispose properties of whatever nature, INCLUDING
PUBLIC DOMINION OR PATRIMONIAL PROPERTY. THE AFAB IS
AUTHORIZED TO SELL LANDS WHICH ARE HEREBY DECLARED
ALIENABLE AND DISPOSABLE PURSUANT TO THE PROVISIONS OF
EXISTING LAWS AND REGULATIONS GOVERNING SALES OF
GOVERNMENT PROPERTIES; PROVIDED, THAT, NO SALE OF SUCH
LANDS WILL BE UNDERTAKEN UNTIL A DEVELOPMENT PLAN IS
SUBMITTED AND DULY APPROVED BY THE AFAB BOARD OF
DIRECTORS IN ACCORDANCE WITH THE FAB COMPREHENSIVE
MASTER DEVELOPMENT PLAN;

“(b) To sue and be sued in order to carry out its duties,
responsibilities, privileges, powers and functions as granted and provided
for in this Act and to exercise the power of eminent domain for public use
and public purpose OVER ANY PRIVATELY-OWNED PROPERTY
LOCATED WITHIN THE FAB MAIN ZONE AND SUCH OTHER AREAS
WITHIN THE PROVINCE OF BATAAN SUBJECT TO THE
REQUIREMENTS OF THE CONSTITUTION AND PREVAILING LAWS;

*(c) xxx

"() xxx;

“(e) xxx;

“(f) 0x;

(G) TO RECLAIM AND DEVELOP, OR TO UNDERTAKE,

ON ITS OWN OR THROUGH OTHERS, AND APPROVE
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RECLAMATION AND RELATED PROJECTS, IN ACCORDANCE
WITH RELEVANT LAWS INSOFAR AS APPLICABLE TO THE
AFAB, AS WELL AS TO OWN, HOLD, PURCHASE OR LEASE
FORESHORE AREAS WITHIN OR ADJACENT OR
APPROXIMATE TO THE AREAS, PROVIDED, HOWEVER, THAT
THE AFAB SHALL COORDINATE WITH THE LGUS FOR THE
DEVELOPMENT PLANS, ACTIVITIES AND OPERATION OF THE
RECLAIMED AREA IN THE FAB AND ITS EXPANSION AREAS;

(H) TO TAKE WATER, SAND, AND OTHER MATERIALS
FROM ANY PUBLIC STREAM, RIVER, CREEK, LAKE, SPRING,
WATERFALL, OR UNDERGROUND AQUIFERS, AS MAY BE
NECESSARY FOR THE ATTAINMENT OF THE ACT; TO ALTER,
STRAIGHTEN, OBSTRUCT OR INCREASE THE FLOW OF
WATER IN STREAMS OR IN WATER CHANNELS
INTERCEPTING OR CONNECTING THEREWITH OR
CONTIGUOUS TO ITS WORKS OR ANY PART THEREOF AND
TO ISSUE THE CORRESPONDING WATER PERMITS AND
OTHER CLEARANCES IN RELATION TO THE FOREGOING;

() TO EXERCISE SOLE AND EXCLUSIVE PORT
REGULATORY AND ADMINISTRATIVE AUTHORITY WITHIN ITS
TERRITORIAL JURISDICTION, WHICH SHALL INCLUDE ALL
SEAS, LAKES, RIVERS, AND ALL OTHER NAVIGABLE INLAND
WATERWAYS WITHIN THE FAB MAIN ZONE AND ITS
EXPANSION AREAS, INCLUDING WATERWAYS WITHIN THE
FAB MAIN ZONE AND ALL ITS EXPANSION AREAS IN THE
PROVINCE OF BATAAN;

Ig] (J) To license, set fees, regulate, MANAGE, and
undertake the establishment, operation and maintenance of utilities,
other services, educational and medical institutions and
infrastructure in the FAB such as, but not limited to, heat, light and

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power, water supply, telecommunications, mobile, internet and other
data facilities, transport, toll roads and bridges, port services, etc. and
to fix just, reasonable and competitive rates, fares, charges and
prices thereof;

Ih] (K) xxx;

[i] (L) To operate on its own, either directly or through a license to other
tourism - related activities, including games, amusements, recreational and

sports facilities subject-

O (M) xxx
UL (N) xxx

[k] (©) To exclusively enforce and administer the provisions of the
National Building Code of the Philippines and the Fire Code of the
Philippines, as amended, AND MAY PRESCRIBE MEASURES AND
GUIDELINES TO DEAL WITH NATURAL CALAMITIES SUCH AS
EARTHQUAKES, FOREST FIRES, TYPHOONS AND STORM SURGES,
within the territorial jurisdiction of the FAB; Provided, that the AFAB shall be
fully responsible and accountable for the enforcement and administration of
the National Building Code of the Philippines and the Fire Code of the
Philippines, as amended, AND RELEVANT LAWS THERETO within the
FAB. FOR THIS PURPOSE, THE AFAB FIRE AND EMERGENCY
DIVISION AND ITS DULY AUTHORIZED REPRESENTATIVES SHALL
HAVE THE POWERS AND DUTIES TO INVESTIGATE ARSON AND
OTHER FIRE INCIDENTS WITHIN THE FAB, INCLUDING THOSE IN FAB
EXPANSION AREAS..

The AFAB Administrator, or his official designate, shall function as the AFAB
Building Official, who shall issue all building permits and other related

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permits subject to the collection by AFAB of the corresponding permit fees:
Provided, That the AFAB Building Official shall also be authorized to require
owners of houses, buildings, or other structures constructed without the
necessary AFAB permit/s, or those that are condemned and/or abated by
the AFAB in accordance with the conditions set forth in the National Building
Code or Civil Code, as the case may be, whether constructed on public or
private lands, to remove or demolish such houses, buildings, or structures
within fifteen (15) days from receipt of notice. Upon failure of such owner to
remove or demolish such house, building, or structure within such period,
the AFAB may summarily cause its removal or demolition at the expense of
the owner and the occupants.

The AFAB may evict any person who refuses to vacate such premises in
accordance with Republic Act No. 7279, otherwise known as the Urban
Development and Housing Act of 1992,” and other existing laws. A
temporary or permanent relocation site shall be made available for qualified
individuals or families.

Il] (P) To provide BE THE PRINCIPAL PROVIDER OF security IN the
FAB in coordination with the national and local governments. For this
purpose, the AFAB may establish and maintain its security forces and
firefighting capability or hire others to provide the same, SUCH AS THE
INSTALLATION OF SECURITY GATES TO ENCLOSE, RESTRICT, AND
REGULATE THE INGRESS TO AND EGRESS FROM LOCAL AND
NATIONAL ROADS. In the event that an assistance of the military force is
necessary, it shall not interfere in the internal affairs of the FAB except to
provide the necessary security and defense, and their expenses shall be
borne by the National Government. To ensure the maintenance of law and
order within the boundaries of the FAB, including conducting police
investigations, arrests, search and seizure for violation of penal laws inside
the FAB, the AFAB MAY SEEK ASSISTANCE FROM the Philippine
National Police (PNP) WHICH shall establish a police substation, if
necessary, THAT SHALL BE under the supervision of the PNP Provincial

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Director, to be manned by such number of personnel as will allow them to
effectively and efficiently pursue its mandate.

The AFAB shall also be authorized to install control gates at strategic
Points of the national roads within the FAB, through which access into and
departure from the FAB shall be fully controlled by the AFAB;

[m] (Q)To protect, preserve, maintain and develop the forests,
beaches, coral and coral reefs, and maintain ecological balance within the
FAB. For this purpose, the rules and regulations of the Department of
Environment and Natural Resources (DENR) and other government
agencies involved in the above functions shall be implemented by the AFAB;
Provided, that the issuance, enforcement and monitoring of environmental
compliance certificates (ECCs), tree cutting permits, foreshore leases,
MISCELLANEOUS LEASES, and all other related permits and clearances,
AS WELL AS THE PERMIT TO OPERATE AIR POLLUTION SOURCE
AND CONTROL INSTALLATION, AND IMPLEMENTATION PERTAINING
TO THE ISSUANCE OF DISCHARGE PERMIT, WATER PERMIT AND
DRILLING PERMITS, AND ALL OTHER RELATED PERMITS issued-by

the-DENR_and-other_government-agencies-shall be under the exclusive

Control and jurisdiction of the AFAB;

{n] (R) To create, operate and/or contract to operate such functional
units or offices of the AFAB as it may deem necessary;

“[o] (S) To issue certificates of origin for products manufactured or
processed in the FAB;

“P] (T) 200%;

“(q) (U) TO ISSUE ON ITS OWN, OR to recommend the issuance of
working visas renewable every three (3) years to foreign executives and

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foreign technicians with highly specialized skill which no Filipino possesses,
subject to the issuance of the Certification and Alien Employment Permit by
the Department Of Labor And Employment (DOLE);

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”

[1] (V) xxx

Is] (W) xxx

[t) (X) TO ISSUE ON ITS OWN, OR to endorse THE ISSUANCE OF,
Special Resident Retirees’ Visas (SRRVS) for retirees that intend to reside in
the FAB, in collaboration with the Philippine Retirement Authority (PRA), AND
OTHER VISAS; Provided, that the AFAB shall issue joint regulations WITH
OTHER RELEVANT GOVERNMENT AGENCIES on the processing of SRRVs
AND OTHER VISAS in accordance with existing laws;

[ul (¥) To establish, operate and maintain utilities, facilities,
infrastructure, services, businesses, activities, and concessions in the FAB,
Pertaining to shipping and maritime business and activities including
stevedoring and port terminal services or concession; TO UNDERTAKE, ON
ITS OWN OR THROUGH OTHERS, REGULATE AND ADMINISTER YACHT
CLUBS OR YACHT DEVELOPERS FOR THEIR BERTHING FACILITIES TO
BE ESTABLISHED IN THE FAB; provided, that the Maritime Industry Authority
(MARINA) shall continue to exercise its power to regulate and supervise the
shipbuilding and ship repair of any merchant marine vessel operated or to be
operated in the domestic trade and the domestic shipping industry within the
FAB;

[] (2) xxx

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[w] (AA) xxx

[x] (BB) xxx

SEC. 5. Section 14 of Republic Act No. 9728, as amended, is likewise further
amended to read as follows:

“Section 14, Board of Directors of the AFAB. The powers of the AFAB
shall be vested in and exercised by a Board of Directors, hereinafter
referred to as the Board, which shall be composed of the following:

(2) xxx

(b) xxx

(c) Members consisting of:

(1) xxx.

(2) xxx

(3) One (1) from the district covering the site of the FAB MAIN
ZONE;

(4) xx

(5) One (1) representative from FOR the-AFAB-Registered
domestic investors

(6) One (1) representative from FOR the-AFAB-Registered
foreign investors

(7) One (1) representative from the workers-working inthe FAB,
LABOR SECTOR

Provided, that all members of the Board shall be Filipino citizens.

The ADMINISTRATOR and the members of the Board, shall be
appointed by the President of the Philippines to serve for a term of six (6)
years, WITH THE RIGHT TO HOLD OVER UNTIL REPLACEMENT
SHALL HAVE BEEN DULY APPOINTED AND QUALIFIED, unless sooner
separated from service due to death, voluntary resignation or removal for
cause. In case of death, resignation or removal for cause, the replacement
shall serve only the unused portion of the term.


No person shall be appointed by the President of the Philippines as.

2 a member of the Board unless he is a Filipino citizen, of good moral
3 character, of proven probity and integrity, and a degree holder in any of the
4 following fields: economics, business, public administration, law,
5 management or their equivalent, and with at least ten (10) years relevant
6 working experience preferably in the field of management or public
7 administration.

8 The members of the Board shall each receive per diem at rates to be
9 determined by the Department of Budget and Management (DBM) in
10 accordance with existing rules and regulations: Provided, however, That

ul the total per diem collected each month shall not exceed the equivalent per
12 diem for four (4) meetings.

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14 SECTION 6. Section 21 of Republic Act No. 9728, as amended, is hereby
15 amended to read as follows:

16 “Sec. 21. Capitalization. — The capital stock to be contributed by the

17 Government shall be (a) 7wo FIVE billion pesos (Php 2-5,000,000,000.00),

18 with option to increase capitalization upon the discretion of the AFAB, (b)

19 All lands embraced and covered by the FAB, including those properties
20 conveyed to the Government Service Insurance System (GSIS) and/or the

21 Social Security System (SSS) under Proclamation No. 740, as amended

2 by Proclamation No. 900, as well as permanent improvements and fixtures

2B upon proper inventory not otherwise alienated, conveyed, or transferred to

24 another government agency; and (c) All other assets which the President

25 may transfer to the AFAB as part of the equity contribution of the

26 government.”

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28 Section 7. Section 24 of Republic Act No. 9728, as amended, is further
29 amended to read as follows:

30 “Section 24. Relationship with Local Government Units. - Except as herein

31 provided, the MunicipalitlES of Mariveles in the Province of Bataan WHERE

32 THE FAB MAIN ZONE AND ITS EXPANSION AREAS ARE LOCATED

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shall operate and function SEPARATELY AND INDEPENDENTLY FROM
THE AFAB, in accordance with the Local Government Code of 1991. ALL.
ECONOMIC AND NON-ECONOMIC ACTIVITIES WITHIN THE FAB MAIN
ZONE AND ITS EXPANSION AREAS SHALL BE UNDER THE DIRECT
AND EXCLUSIVE CONTROL, ADMINISTRATION AND JURISDICTION
OF THE AFAB, EXCEPT FOR NECESSARY COORDINATION AND
COOPERATION WITH LGUS TO MIRROR EFFORTS OF THE NATIONAL,
GOVERNMENT.

Section 8. Section 26 of Republic Act No. 9728, as amended, is further
amended to read as follows:

“Section 26. Interpretation/ Construction. - The powers, authorities and
functions that are vested m the AFAB are intended to establish decentralization
of governmental functions and authority and promote an efficient and effective
working relationship between the AFAB, the National Government and the LGU.
IN CASE OF ANY CONFLICT BETWEEN THE AFAB AND THE LOCAL
GOVERNMENT UNITS (LGUS) AND THE NATIONAL GOVERNMENT (NG)
ON MATTERS AFFECTING THE FAB OTHER THAN DEFENSE AND
SECURITY MATTERS, THE DECISION OF THE AFAB SHALL PREVAIL.”

Section 9. Section 28 of Republic Act No. 9728, as amended, is further
amended to read as follows:
“Section 28. Transitory Provisions. - All properties, assets, funds,
rights, obligations, and liabilities are hereby transferred to the AFAB except
for the liabilities that are not properly accounted for as per the reports
coming from the Commission on Audit, which shall be retained by the PEZA.

The AFAB shall be responsible for the operations, administration,

management and development of the FAB. The AFAB shall effect the

transfer herein provided in a manner that will ensure the least disruption of

ongoing programs of the BEZ. The qualified and necessary personnel of the

BEZ shall be transferred to and absorbed by the AFAB: Provided, That the

tenure, rank, salaries and privileges of such personnel are not reduced or
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adversely affected. The personnel whose services are not retained by the
AFAB shall be granted separation pay and retirement and other benefits
they are entitled to under existing laws but in no case shall the separation
pay be less than one (1) month for every year of service.

In the period prior to the actual assumption of duties by the AFAB, all officers
and employees of the BEZ shall continue to exercise their functions and

discharge their duties and responsibilities. The BEZ shall be deemed
abolished upon the organization of the AFAB.

ANY AND ALL LAND TITLES AND TAX DECLARATIONS OF ALL REAL.
AND PERSONAL PROPERTIES OWNED AND ADMINISTERED BY THE
THEN EXPORT PROCESSING ZONE AUTHORITY (EPZA) AND
PHILIPPINE ECONOMIC ZONE AUTHORITY (PEZA) SHALL BE
AUTOMATICALLY TRANSFERRED TO AND BE OWNED BY THE AFAB
BY OPERATION OF LAW. “

Section 10, Section 29 of Republic Act No. 9728, as amended, is further
amended to read as follows:
“Section 29. Implementing Rules and Regulations. - The AFAB
Board of Directors, in- consultation with-relevant- government agencies
Department-of the-tnterior_andLocal_Government, shall formulate the
implementing rules and regulations of this Act within ninety (90) days after
its approval. Such rules and regulations shall take effect fifteen (15) days
after their publication in a newspaper of general circulation in the Philippines

Section 11. Notwithstanding the provisions of Republic Act No. 11534,
otherwise known as the “Corporate Recovery and Tax Incentives for Enterprises”
(CREATE) Act,” domestic enterprises within the FAB Main Zone and Expansion Areas
shall be exempted from payment of Value Added Tax (VAT) and shall be entitled to
VAT Zero-rating.

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Section 12. Section 32 of Republic Act No. 9728, as amended, is further
amended to read as follows:

“Section 32. Repealing Clause. — Proclamation No. 740, as
amended by Proclamation No. 900 and Presidential Decree No. 545, insofar
as these laws convey the balance of the public land mentioned therein in
favor of the GSIS and the SSS, and mandate said agencies to develop the
land for construction of housing units and/or condominium houses, are
hereby repealed.

All other laws, CHARTERS, decrees, executive orders, ADMINISTRATIVE
ORDERS, ISSUANCES, rules and regulations or parts thereof, inconsistent
with the provisions of this Act are hereby repealed or modified accordingly.”

SEC. 13. Separability Clause. Any portion or provision of this Act that may be
declared unconstitutional shall not have the effect of nullifying other portions or
provisions hereof as such remaining provisions can still subsist and be given effect.

SEC. 14.  Effectivity. - This Act shall take effect after fifteen (15) days

following its complete publication in the Official Gazette or in two (2) newspapers of
general circulation whichever is earlier.

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