EIGHTEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
)
SENATE
S. No.
283
of fiif 
It.H i'
*19 JUL-8 P2 57
1
RECLi l L J f.
Introduced by SENATOR MANUEL "LITO" M. LAPID
AN ACT
REVITALIZING THE BASES CONVERSION DEVELOPMENT, AMENDING 
FOR THE PURPOSE REPUBLIC ACT NO. 7227, OTHERWISE KNOWN AS 
THE "BASES CONVERSION AND DEVELOPMENT ACT OF 1992", AS 
AMENDED
EXPLANATORY NOTE
Republic Act No. 7227, otherwise known as the Bases Conversion and 
Development Act of 1992, was signed into law by former President Corazon Aquino 
on March 13, 1992. Said law created the Bases Conversion and Development 
Authority (BCDA), with a general mandate to administer the conversion of the 
military base lands in Metro Manila and other military reservations covered by the 
1947 RP-US Military Bases Agreement, among others, with the goal of accelerating 
the economic and social development particularly of Central Luzon and of the whole 
country in general.
Several improvements on the BCDA Charter were introduced and enacted 
through RA 7917 in 1995 and RA 9400 in 2007.
This proposed measure further amends Republic Act No. 7227, as amended, in 
order to effectively promote the Clark Special Economic Zone (CSEZ) and entice 
more and more investors to put up their businesses in CSEZ.


Immediate passage of this measure is earnestly requested.
EL "LITO" M. LAPID
Senator


EIGHTEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
)
SENATE
S. No.
283
0< t:'f
•19 JUL-8 P2 58
RtCL.Vi"
Introduced by SENATOR MANUEL LITO M. LAPID
AN ACT
REVITALIZING THE BASES CONVERSION DEVELOPMENT, AMENDING 
FOR THE PURPOSE REPUBLIC ACT NO. 7227, OTHERWISE KNOWN AS 
THE "BASES CONVERSION AND DEVELOPMENT ACT OF 1992", AS 
AMENDED
Be it enacted by the Senate and House o f Representatives o f the Philippines in 
Congress assembled:
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Section. 1. 
Section 15 of Republic Act No. 7227, as amended, is hereby amended
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to read as follows:
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"SEC. 15. 
Clark Special Economic Zone (CSEZ) [and Clark Freeport
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Zone (CFZ)]. Subject to the concurrence by resolution of the local
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government units directly affected, the President is hereby authorized to
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create by executive proclamation a Special Economic Zone covering the
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lands occupied by the Clark military reservations and its contiguous
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extensions as embraced, covered and defined by the 1947 Military Bases
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Agreement between the Philippines and the United States of America, as
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amended, 
located within the territorial jurisdiction 
of Angeles City,
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municipalities of Mabalacat and Porac, Province of Pampanga, and the
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municipalities of Capas and Bamban, Province of Tarlac, in accordance with


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the provision as herein provided insofar as applied to the Clark military 
reservations. [The Clark Air Base proper with an area of not more than four 
thousand four hundred hectares (4,400 has.), with the exception of the 
twenty-two-hectare commercial area situated near the main gate and the 
Bayanihan Park consisting of seven and a half hectares (7.5 has.) located 
outside the main gate of the Clark Special Economic Zone, is hereby 
declared 
a 
Freeport 
zone]. 
THE 
CSEZ 
W ITH 
AN 
AREA 
OF 
APPROXIMATELY 
THIRTY-FIVE 
THOUSAND 
FOUR 
HUNDRED 
HECTARES (35,400 HAS.), ARE HEREBY DECLARED A SPECIAL 
ECONOMIC ZONE UNDER THIS ACT.
"The [CFZ] CSEZ shall be operated and managed as a separate customs 
territory ensuring free flow or movement of goods and capital equipment 
within, into and exported out of the [CFZ] CSEZ, as well as provide 
incentives such as tax and duty-free importation of raw materials and 
capital equipment. However, exportation or removal of goods from the 
territory of the [CFZ] CSEZ 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, the National Internal Revenue Code of 
1997, as amended, and other relevant tax laws of the Philippines.
"The provisions of existing laws, rules and regulations to the contrary 
notwithstanding, no national and local taxes shall be imposed on registered 
business enterprises within the [CFZ] CSEZ. In lieu of said taxes, a five 
percent (5%) tax on gross income earned shall be paid by all registered 
business enterprises within the [CFZ] CSEZ and shall be directly remitted 
as follows: three percent (3%) to the National Government, and two 
percent (2%) to the treasurer's office of the municipality or city where they 
are located.
"The governing body of the Clark Special Economic Zone IS BCDA 
AND 
ITS 
IMPLEMENTING 
ARM 
IS 
CLARK 
DEVELOPMENT


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2
CORPORATION (CDC) [shall likewise be] AS established by [Executive 
proclamation with such powers and functions exercised by the Export 
Processing Zone Authority pursuant to Presidential Decree No. 66, as 
amended] PRESIDENTIAL PROCLAMATION NO. 163 SERIES OF 
1993 AND 
EXECUTIVE 
ORDER 
NO. 
80, 
SERIES OF 
1993: 
PROVIDED, THAT, 
BCDA SHALL ENJOY THE 
POWERS AND 
FUNCTIONS OF SBMA UNDER SECTION 13(B) HEREIN, EXCEPT 
THOSE PERTAINING TO THE GRANT OF GAMING LICENSES, 
WHICH SHALL CONTINUE TO BE EXERCISED BY THE PAGCOR: 
Provided FURTHER, That, THEY [it shall] have no regulator/ authority 
over public utilities, which authority pertains to the regulatory agencies 
created by law for the purpose, such as the Energy Regulatory 
Commission created under Republic Act No. 9136 and the National 
Telecommunications Commission created under Republic Act No. 7925.
"x X X
"Subject to the concurrence by resolution of the local government 
units directly affected and upon recommendation of the Philippine 
Economic Zone Authority (PEZA), the President is hereby authorized to 
create by executive proclamation Special Economic Zones covering the city 
of Balanga and the municipalities of Limay, Mariveles, Morong, Hermosa, 
and Dinalupihan, Province of Bataan.
"Subject to the concurrence by resolution of the local government 
units directly affected and upon recommendation of the PEZA, the President 
is hereby authorized to create by Executive Proclamation Special Economic 
Zones covering the municipalities of Castillejos, San Marcelino, and San 
Antonio, Province of Zambales.
"Duly registered business enterprises that will operate in the Special 
Economic Zones to be created shall be entitled to the same tax and duty 
incentives 
as 
provided 
for 
under 
Republic 
Act 
No. 
7916, 
as 
amended: Provided, That for the purpose of administering these incentives, 
the PEZA shall register, regulate, and supervise all registered enterprises 
within the Special Economic Zones."


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SEC. 2. A new Section 17 of Republic Act No. 7227, as amended is hereby inserted 
to read as follows:
"SEC. 17. THE SUPREME COURT SHALL DESIGNATE A BRANCH 
OF THE REGIONAL TRIAL COURT AND MUNICIPAL TRIAL COURT IN  
THE CSEZ TO HANDLE CASES FILED BY OR INVOLVING THE CSEZ OR 
ITS RESIDENTS OR REGISTERED BUSINESS ENTERPRISES ON ANY 
MATTER OR INCIDENT OCCURRING W ITH IN  THE CSEZ."
SEC. 3. Section 17 of RA 7227, is hereby amended and renumbered as Section 18, to 
read as follows;
"Section [17] (18). Supervision. -The [Conversion Authority] BCDA 
AND ITS SUBSIDIARIES shall be under the direct control and supervision 
of the Office of the President for purposes of policy direction and 
coordination."
SEC. 4. Sections 18, 19 and 20 of R.A. 7227, are hereby renumbered accordingly.
SEC. 
5. 
PURSUANT 
TO 
THE 
COMPREHENSIVE 
MASTER 
DEVELOPMENT PLAN BY BCDA AS APPROVED BY THE PRESIDENT OF 
THE PHILIPPINES, LAND W ITH IN  THE CSEZ INCLUDING THE CLARK 
FREEPORT 
ZONE 
IS 
HEREBY 
DECLARED 
AS 
ALIENABLE 
AND 
DISPOSABLE AND BCDA 
IS AUTHORIZED TO SELL THESE LANDS 
SUBJECT TO COMPLIANCE W ITH THE NATIONALITY REQUIREMENTS 
UNDER THE PHILIPPINE CONSTITUTION AND EXISTING LAWS FOR 
OWNERSHIP THEREOF: PROVIDED, THAT, THE AREA TO BE CLASSIFIED 
AS ALIENABLE AND DISPOSABLE SUBJECT TO SALE SHALL NOT BE 
MORE THAN 10%  OF THE TOTAL LAND AREA OF THE CSEZ INCLUDING 
THE CLARK FREEPORT ZONE.


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SEC. 
6. IMPLEMENTING RULES AND REGULATIONS. -W ITH IN  NINETY 
(90) DAYS FROM THE EFFECTIVITY OF THIS ACT, THE FOLLOWING SHALL 
PROMULGATE 
THE 
NECESSARY 
RULES 
AND 
REGULATIONS 
FOR 
THE 
IMPLEMENTATION OF THE SPECIFIC PROVISIONS OF THIS ACT:
(a) 
THE DEPARTMENT OF FINANCE, IN  COORDINATION W ITH THE 
BUREAU OF INTERNAL REVENUE, AND IN  CONSULTATION W ITH CDC, FOR THE 
NECESSARY RULES AND REGULATIONS IMPLEMENTING SECTION 1 OF THIS 
ACT BUT ONLY IN  SO FAR AS IT  AMENDS SECTION 15 OF REPUBLIC ACT NO. 
7227, AS AMENDED; AND
(b) 
THE 
CDC 
AND 
BCDA 
FOR 
THE 
NECESSARY 
RULES 
AND 
REGULATIONS IMPLEMENTING ALL OTHER PROVISIONS OF THIS ACT.
SEC. 
7. Separability Clause, if any provision of this act is subsequently declared 
unconstitutional, the validity of the remaining provisions hereof shall remain in full force 
and effect.
SEC. 8. 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. 9.This Act shall take effect fifteen (15) days after its publication in the Official 
Gazette or in a newspaper of general circulation.
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Approved,