HOUSE OF REPRESENTATIVES

RECEIVED
SEVENTEENTH CONGRESS DATE: 30 JUN 2016
REPUBLIC OF THE PHILIPPINES ) :
twwe:_ $29

First Regular Session )
HOUSE OF REPRESENTATIVES

Introduced by Representative Maximo B. Rodriggez, Jr. REGISTRATION UNIT
BILLS AND INDEX SERVICE

House Bill No. __ 859
EXPLANATORY NOTE

This bill seeks to establish a special economic zone in Barangay Balubal
Cagayan de Oro City, Province of Misamis Oriental, pursuant to the general policies and
guidelines set forth under Republic Act No. 7916, otherwise known as the “Special
Economic Zone Act of 1995.”

Cagayan de Oro City is the gateway to the island of Mindanao. It is the focal point
of domestic and foreign trade as well as the export outlet of the vast agricultural products
of Mindanao. The city is rich in agricultural and forest lands, mineral resources and scenic
tourist spots. It has a typhoon-free climate, favorable peace and order condition and good
infrastructures and utilities. These factors are conducive to sustainable growth and
development,

Balubal is one of the fast-growing barangays in the eastern side of Cagayan de
Oro City. Its strategic location is an ideal site for industrial, commercial and recreational
centers. It can also serve as a major entry and exit point of trade considering that its
neighboring barangays have numerous seaports.

The establishment of a special economic zone will alleviate and improve the
economic condition of the City and the nearby provinces. The residents will be assured of
focal employment opportunities which will hasten the economic growth not only in the
area but in the nearby provinces as well

In line with the government's policy to encourage, promote, induce and accelerate

a sound and balanced industrial, economic and social development of the country, the
establishment of Cagayan de Oro Special Economic Zone is eamestly recommended

MAXIMO“B. RODRIGUEZ, JR.


SEVENTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

Introduced by Representative Maximo B. Rodriquez, Jr.

House BillNo.__ 809

AN ACT
ESTABLISHING THE CAGAYAN DE ORO SPECIAL ECONOMIC ZONE IN
BARANGAY BALUBAL, CAGAYAN DE ORO CITY, PROVINCE OF MISAMIS
ORIENTAL AND APPROPRIATING FUNDS THEREFOR

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

SECTION 1. Short Title. - This Act shall be known as the “Cagayan de Oro Special
Economic Zone Act’.

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 in the country, in order to provide jobs to the people especially
those in the rural areas, increase their productivity and their individual and family income,
and thereby improve the level and quality of their 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. Cagayan de Oro Special Economic Zone. - There shall be established in
Barangay Balubal, Cagayan de Oro City. A special economic zone under the supervision
of the Philippines Economic Zone Authority (PEZA), to be known as the Cagayan de Oro
Special Economic Zone, hereinafter referred to as the “Cagayan de Oro ECOZONE.”

SEC. 4. Board of Directors, - The powers of the Cagayan de Oro ECOZONE 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) Acchairman who shall, at the same time, be the Administrator of the Cagayan de
Oro ECOZONE:
b) Avice chairman who shall come from among the members of the Board;
c) The congressman of the 2” District of Cagayan de Oro City;
d) The Mayor of Cagayan de Oro City;
e) The Barangay Captain of Barangay Balubal, Cagayan de Oro City;
f) Arepresentative from local or domestic investors;
9) Arepresentative from foreign investors; and
h) A representative from the workers in the Cagayan de Oro ECOZONE, as
members.

The Congressman of the 2” District of Cagayan de Oro City, city mayor and
barangay captain of Barangay Balubal of Cagayan de Oro City shall serve as ex-officio
members of the Board whose term of office shall correspond to their terms as elected
officials.

The chairman and the members of the Board, except the ex-officio members, shall
be appointed by the President of the Philippines to serve for a term of six (6) years,
unless sooner removed for cause, dies or resigns voluntarily. In case of death,


resignation or removal for cause, the replacement shall serve only the remaining portion
of the term,

Except for the representative of the business and labor sectors, no person shall
be appointed by the President of the Philippines as a members 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,
management or their equivalent, and with at least ten (10) years relevant working
experience preferably in the field of management or public administration

The members of the Board shall each receive per diem at a ratio to be determined
by the Department of Budget and Management in accordance with existing rules and
regulations,

SEC. 5. Powers and Functions. - The Board shall exercise the following powers and
functions:

a) Operate, administer, manage and develop the Cagayan de Oro ECOZONE
according to the principles and provisions of this Act:

b) Recommend to the President the issuance of a prociamation to fix and delimit the
site of the Cagayan de Oro ECOZONE.

©) Register, regulate and supervise enterprises in the Cagayan de Oro ECOZONE in
an efficient manner, subject to existing laws;

d) Coordinate with the local government units concemed and exercise general
jurisdiction over the Cagayan de Oro ECOZONE;

) Construct, acquire, own, lease, operate and maintain on its own or through
contracts or joint venture, adequate facilities and infrastructure required or needed
for the operation and development of the Cagayan de Oro ECOZONE, in
connection with appropriate national or local government authorities and in
conformity with applicable laws;

f) Exercise such powers as may be essential, necessary or incidental to the powers
granted under this Act; and

9) Issue rules and regulations consistent with the provisions of this Act as may be
necessary to accomplish and implement the purposes of this Act.

SEC. 6. Powers and Duties of the Chairman-Administrator. - The Chairman-
Administrator shall exercise the following powers and duties:
a) Direct and manage the affairs of the Cagayan de Oro ECOZONE in accordance
with the policies of the Board;
b) Establish the internal organization of the Cagayan de Oro ECOZONE under the
conditions that the Board may prescribe;
©) Submit an annual budget and necessary supplemental budget to the Board for its
approval
d) Submit within thirty (30) days after the close of each fiscal year an annual report to
the Board and such other reports as may be required;
e) Submit to the Board for its approval policies, systems, procedures, rules and
regulations that are essential to the operation of the Cagayan de Oro ECOZONE:
f) 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 Cagayan de Oro ECOZONE; and
9) Perform such other duties as may be assigned by the Board or which are
necessary or incidental to his office,

SEC. 7. Personnel. — The Board shall provide for an organization and staff of the
Cagayan de Oro ECOZONE. Upon the recommendation of the Chairman-Administrator,
the Board shall appoint and fix the remuneration and other emoluments of its officers and
employees in accordance with existing laws and regulations.

No officer or employee of the Cagayan de Oro ECOZONE shall be removed or
suspended except for a cause in accordance with civil service rules and regulations.


SEC. 8. Capitalization. - The Cagayan de Oro ECOZONE shall have an authorized
capital stock of Two Hundred Million Pesos (Php20,000,000.00), the majority shares of
which shall be subscribed and paid for by the national government and the local
government of Cagayan de Oro City with the national government contributing 80% of the
majority shares and the LGU of Cagayan de Oro City contributing 20%.

The Board of Directors of Cagayan de Oro ECOZONE, with the concurrence of
the Secretary of Finance, may sell shares of not more than forty per centum (40%) of the
capital stock of the Cagayan de Or ECOZONE to the general public under such policy as.
the Board and Secretary of Finance may determine. The national government and the
LGU shall in no case own less than sixty per centum (60%) of the total issued and
outstanding capital of the Cagayan de Oro ECOZONE.

The amount necessary to subscribe and pay for the shares of the national
government to the capital stock of the Cagayan de Oro ECOZONE shall be included in
the annual General Appropriations Act. For the local government unit of Cagayan de Oro
City, the funds shall be taken from its internal revenue allotment and other local funds

SEC. 9. Supervision and Control. — For purposes of policy direction and coordination,
the Cagayan de Oro ECOZONE shall be under the direct control and supervision of the
Office of the President

SEC. 10. Regional Development Council. - The Board of Directors shall determine the
development goals for the Cagayan de Oro ECOZONE within the framework of national
development plans, policies and goals. The Chairman-Administrator shall, upon approval
by the Board, submit the Cagayan de Oro ECOZONE pians, programs and projects to the
Regional Development Council for inclusion and inputs to the overall regional
development plan.

SEC. 11. Tax Exemption. — The Cagayan de Oro ECOZONE is hereby declared tax
exempt from the payment of all taxes, import duties, charges and costs, including service
fees in any court or administrative proceedings in which it may be 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
Cagayan de Oro ECOZONE to be self-sustaining and financially capable by then to pay
such taxes, custom duties, fees and other charges after providing for debt service
requirements of the Cagayan de Oro ECOZONE and of its projected capital and
operating expenditures.

SEC. 12. Audit. — The Commission on Audit shall appoint a representative who shall be
full time auditor of the Cagayan de Oro ECOZONE and assign such number of personnel
as may be necessary to assist said representative in the performance of his duties, The
salaries and emoluments of the assigned auditor and personnel shall be in accordance
with pertinent laws, rules and regulations.

SEC. 13. Repealing Clause. — All laws, decrees, executive orders, rules and regulations
and other issuances, or parts thereof, inconsistent with the provisions of this Act, are
hereby repealed or modified accordingly.

SEC. 14. Separability Clause. — If any part or provision of this Act is deciared
unconstitutional, or other parts or provisions hereof which are not affected thereby shall
continue to be in full force and effect.

SEC. 15. Effectivity. — This Act shall take effect fifteen (15) days after its publication in
at least one (1) national newspaper of general circulation.
Approved,