Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
NINETEENTH CONGRESS
First Regular Session
HOusE BiLL NO. 8m
Introduced by:  JOSEFINA 8. TALLADO
AN ACT ESTABLISHING A SPECIAL ECONOMIC ZONE AND FREE PORT IN THE
MUNICIPALITY 0F JOSE PANGANIBAN, PROVINCE 0F CAMARINES NORTE,
CREATING FOR THE PURPOSE "E CAMARINES NORTE FIRST  DISTRICT SPECIAL
ECONOMIC ZONE AND FREE PORT AUTHORll-Y, AND APPROPRIATING FUNDS
THEREFOR
EXPLANATORY NOTE
This bill seeks for the creation Of a special economic zone and free port in the  lst
District of Camarines Norte Province. This is consistent with the declared policy of the state
to encourage,  promote,  and accelerate the sound and balanced industrial, economic and
social development of the country.
The establishment of special economic zone and free port in Camarines Norfe will
also attract legitimate and productive foreign capital that will put our province within the radar
of  investors  looking  for  blue  ocean  markets  they  can  expand  or settle  in.  This  will  also
generate  employment  and  inerease  productivity  of  individual  as  well  as  family  incomes
thereby enhancing the quality of life of the people of Camarines Norte.
The Municipality of Jose Panganiban  in the lst District of Camarines  Norfe is best
suited for the establishment of the said special economic  zone  and free port.  It has the
economic factors and qualificatons required Of a viable economic zone including, flat lands,
viable seaport,  well-paved roads  and  most importantly,  it is capable of producing  literate,
educated, and skilled workers.
Ultimately the establishment Of an economic zone and free port will not only redound
to the benefit of the Mambulao community or the people of the 1 st District but also the entire
province and will make Camarines Norte at par whh its regional neighbors already enjoying
the economic benefits of an ecozone.
In view of the foregoing considerations, the immediate consideraton and approval of
this bill is highly recommended.
. TALLADO


Republic of the Philippines
HOUSE.OF REPRESENTATIVES
Quezon City
NINETEENTH CONGRESS
First Regular Session
HoUSE BILL No.  8 1 14
[htroduced by:  JOSEFINA 8. TALLADO
AN ACT ESTABLISHING A SPECIAL ECONOMIC ZONE AND FREE PORT IN THE
MUNICIPALITY 0FJOSE PANGANIBAN, PROVINCE OF CAMARINES NORTE, CREATING
FOR THE PURPOSE THE CAMARINES NORTE FIRST  DISTRICT SPECIAL ECONOMIC
ZONE AND FREE PORT AU"ORITY, AND APPROPRIATING FUNDS THEREFOR
Be  it  enacted  by  the  Senate  and  House  of  Representatives  of the  Philippines  in  Congress
assembled:
CHAPTER I
GEN ERAL PROVISIONS
Section  1.  Short Title.  -This  act shall  be known  as the  .Camarines  Norfe  First District
Special Economic Zone and Free Port Act."
Section  2.  Declaration  Of Policy.  -  It is  declared the  policy of the state to  encourage,
promote, and accelerate the sound and balanced industhal, economic and social development of
the country. The establishment of special economic zone and free port shall attract legitimate and
productive foreign investhents in strategic locations in the country. It shall generate employment
and increase productivity and individual, as well as family incomes thereby enhancing the quality
of life of the Filipino people.
CHAPTER 11
GOVERNING STRUCTURES
Section 3. Creation of the Camarines Norfe First District Special Economic Zone and Free
Port Authority. - ln accordance with the foregoing declared policy and subject to the concurrence
of the local government unit (LGU) of the Municipality of Jose panganiban, Province of camarines
Norfe,  there  is  hereby  established  a  special  economic  zone,  hereinafter  referred  to  as  the
Camarines Norte First District Special Economic Zone and Freeport or the Camarines Norfe First
District Ecozone. The Camarines Norte First District Ecozone shall cover a particular area in the
Municipality of Jose Panganiban, Province of Camarines Norfe, the specific metes and bounds of
which shall be more particulariy defined in a presidential proclamation that shall be issued for this
purpose: Provided, That the lands embraced therein shall be contiguous to one another.
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Section 4. Creaton of the Camarines Norte First District Special Economic Zone and Free
Port Authority. There is hereby created a body corporate to be known as the Camarines Norte First
District Economic Zone Authority, hereinafter refened to as the CNFDEZFA, which shall manage
and operate the Camarines Norte First Disthct Ecozone, in accordance with the provisions of this
Act. The corporate life of the CNFDEZFA shall expire in fifty (50) years, counted from the first year
after the effectivity of this Act, unless otherwise erdended by Congress. It shall be organized within
one hundred eighty (180) days after the effectivity of this Act.
Section 5. Governing Principles. The CNFDEZFA shall manage and operate the  Camarines
Norfe First District Ecozone,  under the following principles:
a)   Within the framewck and limitations Of the Constitution and applicable provisions of
Republic Act No. 7160, or the Local Government Code, as amended, the Camarines
Norfe First District Ecozone shall be developed into and operated as a decentralized,
self-reli ant and self-sustaining industrial, commeroial, trading, agro-industrial, tourist,
banking, financial, and investment center with suitable residential areas;
b)   The Camarines Norfe First District Ecozone shall  be equipped with transportation,
telecommunications, and other facilities needed to attract legitimate and productive
investments,   generate  linkage  industries  and  employment  opportunities  for  the
people of the municipality of Jose Panganiban,  Province of Camarines Norte,  and
those in neighboring towns;
c)    The  Camarines  Norfe  First  District  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,  the  Philippine
Economic Zone Authority (PEZA), and the Deparfuent of Trade and Industry (DTl),
with foreign entities or enterprises;
d)    Foreign citizens and companies owned by non-Filipinos in whatever proportion may
set   up   enterprises   in   the   Camarines   Norfe   First   District   Ecozone,   either   by
themselves or in a joint venture with Filipinos in any sector of industry, internatonal
trade and commerce within the Ecozone;
e)   The Camarines Norte First District Ecozone shall  be managed and operated as a
separate customs territory thereby ensuring the free flow or movement of goods and
capital within, into and out of its territory, and shall likewise provide incentives subject
to  Title   Xlll   of  the   Natonal   Internal   Revenue  Code,   as  amended.   However,
exportationorremovalofgoodsfromtheterritoryoftheCamarinesNorfeFirstDistrict
Ecozone to the other parts Of the  Philippine territory shall  be subject to customs
duties and taxes under Republic Act No.10863, otherwise known as the "Customs
Modernization and Tariff Act' and other relevant tax laws of the Philippines;
f)    The areas comprising the Camarines Norfe First District Ecozone may be expanded
or reduced, when necessary, through a presidential proclamaton issued for the said
purpose. For this purpose, the CNFDEZFA, in consultaton with the LGU, shall have
the power to acquire either by purohase, negotiation or condemnaton proceedings,
any private land within or adjacent to the Camarines Norfe First District Ecozone for
the   following   purposes:   (I)   consolidaton   of  lands   for   zone   development;   (ii)
acquisition of right of way to the Ecozone; and the (iii) protection Of watershed areas
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and natural assets valuable to the prosperity of the Camarines Norfe First District
Ecozone;
g)   Goods manufactured by a Camarines Norfe First District Ecozone enterprise may be
made  available  for  immediate  retail  sale  in  the  domestic  market,  subject to  the
payment of corresponding taxes on raw materials and other regulations that may be
formulated  by  the  CNFDEZFA,   in  coordinaton  with  the  PEZA,  the  Bureau  of
Customs, the Bureau Of Internal Revenue, and the DTI. However, in order to protect
domestic industries,  a Negative  List of industries shall  be drawn  up  and  regulariy
updated by the PEZA.  Enterprises engaged in industries included in such Negatve
List shall not be allowed to sell their products locally; and
h)   The  defense  and  security of the  Camarines  Norfe  First District Ecozone  and  its
perimeter shall be the responsibilfty Of the national government, in coordinaton with
the CNFDEZFA and the concerned LGU.
Section  6.  Development Goals  of the  Camarines  Norfe  First District  Ecozone.  -The
FDEZA shall determine the development goals of the Camarines  Norfe First District Ecozone
within  the  framework  of  natonal  development  plans,  policies,  and  goals.  The  Chairperson-
Administrator shall, upon approval by the Board of CNFDEZFA, submit the plans, programs, and
projects of the Camarines Norfe First District Ecozone to the Regional Development Council for
inclusion in the regional development plan.
Section 7.  Capitalizaton. - The CNFDEZFA shall  have an authorized capital stock of
Two  Billion  Pesos  (2,000,000,000.00)  no  par  shares  with  a  minimum  issue  of  Ten  pesos
(Phpl0.00) each, the majority shares of which shall be subscribed and paid for by the national
government and the LGU embracing the Camarines Norte First District Ecozone. The Board of
Directors of the CNFDEZFA may, with the written concurrence of the Secretary of Finance, sell
shares representing not more than forty per centum (40%) of the capital stock of the CNFDEZFA
to the public under such policy as the Board and the Secretary of Finance may determine. The
national government and the LGU of the Municipality of Jose Panganiban shall in  no case own
less than sirty per centum (60%) of the total issued and outstanding capital of the CNFDEZFA.
The amount necessary to subscribe and pay for the shares of the natonal government to
the capital stock of the CNFDEZFA shall be included in the General Appropriatons Act. For the
LGU of the Municipality of Jose Panganiban, the funds shall be taken from their internal revenue
allotment and other local funds.
Section 8.  Principal Office of the CNFDEZFA. - The CNFDEZFA shall maintain its own
principal office in the Municipality Of Jose Panganiban,  Province of Camarines Norfe but it may
establish liaison offices within the Philippines as may be necessary for the proper conduct of its
business.
Section 9.  Powers and Functions of the CNFDEZFA - The CNFDEZFA shall  have the
following powers and functions:
a)   To operate, administer, manage, and develop the Camarines Norfe First District
Ecozone according to the principles and provisions set forth in this Act
4


b)  To register, regulate and supervise the enterprises in the Camarines Norte First
District Ecozone in an efficient and decentralized manner, subject to existing laws.
c)   To coordinate with LGUs and exercise general provision over the development
plans, activities, and operatons of the Camarines Norte First District Ecozone.
d)   To  regulate  and  undertake  the  establishment,  construction,  operation  and
maintenance of public utilities, other services, and infrastructure in the Camarines Norte First
District Ecozone such  as light and  power in ccordinaton with the  National  Electrificaton
Administration,   shipping,   barging,   stevedoring,   cargo   handling,   hauling,   warehousing,
storage of cargo, port services or concessions, piers, wharves, bulkheads,  bulk terminals,
mcoring  areas,  storage  areas,  roads,  telecommunications  transport,  bridges,  terminals,
conveyors, water supply and storage, sewerage, drainage, airport operations in coordination
with  the  Civil  Aviation  Authority  of the  Philippines  (CAAP),  and  such  other  services  or
concessions  or  infrastructure   necessary  or  incidental   to  the  accomplishment  of  the
objectives of this Act;
e)   To construct, acquire, own, lease, operate and maintain on its own or through
contracts, franchise, license, bulk purohase from the private sector or permits under any of
the  schemes  allowed  in  Republic  Act  No.  6957  (the  Build-Operate  Transfer  Law,  as
amended), or joint venture, adequate facilities and infrastructure required or needed for the
operation and development of the Camarines Norfe First Distict Ecozone, in coordination
with appropriate national and local government authorities and in conformity with applicable
laws thereon;
f) To approve plans,  programs,  and projects of the Camarines Norfe First Disthct
Ecozone to be submitted to the Regional Development Council for inclusion and inputs to
the overall regional development plan;
g)   To operate on its own, either directly or through license to others, tourism-related
activities, including games, amusements, recreatonal and sports facilities;
h)   To  raise or  borrow,  within the  limitatons  provided  by  law,  and  subject to  the
approval or opinion of the Monetary Board of the Bangko Senfra/ ng Pi7i.pi.nas (BSP), as the
case may be,  adequate and necessary funds from lceal or foreign sources, to finance its
projects and programs under this Act and for this purpose, to issue bonds, promissory notes
and other forms of securities,  and to secure the same by a guarantee, pledge, mortgage,
deed of trust or an assignment of all or part Of its property or asset;
i)    To protect, preserve, maintain, and develop the forests, beaches, coral and coral
reefs, and maintain ecological balance within the Ecozone. Notwithstanding the Authority of
theCNFDEZFAtocreaterulesforsuchpurpose,therulesandregulationsOftheDepartment
of Environment and Natural Resources (DENR) and other government agencies involved in
the above functions shall be implemented by the CNFDEZFA,
j)    To create, operate and/or contract to operate such fundional units or offices of
the CNFDEZFA as it may deem necessary;
5


k)   To adopt, alter and use a corporate seal, contract, lease,  buy, acquire, own or
otherwise dispose Of personal and/or real property of whatever nature; sue and be sued;
and otherwise carry out its funetions and duties as provided for in this Act;
I)    To  issue  certificate  of origin  for  products  manufactured  or  processed  in  the
Ecozone in accordance with prevailing rules of origin and the pertinent regulations of the
Philippine  Economic Zone Authority (PEZA), the  Department of Trade and  Industry (DTl)
and/or the Deparment of Finance (DOF);
in) To  establish   one-stop   shops  for  the   issuance  of  all   necessary   permits,
clearances,  Iicenses7  and other similar certifications to conduct such adivities intended to
improve the ease of doing business within the Camarines Norfe First District Ecozone,  in
coordinaton with government agencies having jurisdiction over activities therein. Provided,
that all government agencies are directed to provide and extend utmost and full cooperaton
to the Camarines Norfe First District Ecozone in the establishment Of such onestop shops;
n)   To  provide  internal  security to  the  Camarines  Norfe  First  District Ecozone  in
coordination  with  the   Natonal   government  and  affected   LGU.   For  this  purpose,   the
CNFDEZFA shall provide and establish its own internal security and firefighting forces or
hire  others  to  provide  the  same.  Military forces sent  by the  national  government for the
purpose of defense shall  not interfere in the internal  affairs of the Camarines  Norte  First
District Ecozone and expenditures for these military forces shall be borne by the National
Government;
o)   To exeroise 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 cany out, implement
and accomplish the purpose, objectives and policies of this Act; and
p)   To issue rules and regulations consistent with the provisions of this Act as may
be necessary to accomplish and implement the purpose, objectives and policies provided
herein.
Section 10. Board of Directors of the CNFDEZFA. -The powers of the CEZA shall
be vested in and exercised by a Board of Directors.  Hereinafter refened to as the Board,
which shall be composed of the following:
a)   The chairperson, who shall at the same time be the administrator of the CEZA
b)   A Vice-Chairperson, who shall come from among the members of the Board;
c)   Members consisting of;
I)  The Representatve of the 1 st District of Camarines Norte;
2)  The  Governor of the  Province  of Camarines  Norte  or  duly  authorized
representative from the Provincial Government of Camarines Norfe;
3) The Mayor of the Municipality of Jose Panganiban;
4) One (I) representatve from the investors' group
5) One (I) representative from the workers in the Ecozone
6)   One   (1)   representative   designated   by   the   National   Economic   and
DevelopmentAuthority
The  Governor,  the  Representative of the  lst District Of Camarines  Norte  and the
mayor  of the  Municipality  Of Jose  Panganiban  shall  serve  as  ex-officio  members  of the
Board, whose term in the Board corresponds to their term as elected officials.
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The  Chairperson-Administrator and  members of the  Board,  except the  exofficio
members, shall be appointed by the President Of the Philippines to serve for a term of six (6)
years, unless sooner separated from service due to death, voluntary pesignaton, or removal
for cause. In case of death, resignaton or removal for cause, their replacements shall serve
only the  unexpired  portion  of the  respective terms.  No  person  shall  be  appointed  as  a
member of the Board  unless the person 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, except the exi)fficio members, shall each receive per
di'em allowance at rates to be determined by the Department of Budget and Management
(DBM) in accordance with existing rules and regulations:  Provided,  however, that the total
per  di.em  allowance  collected  each  month  shall  not  exceed  the  equivalent  per  di.em
allowance for four (4) meetings. Unless and until the President of the Philippines has fixed
a higher per di.em for the members of the Board, such allowance shall not be more than ten
thousand pesos (Phpl 0,000.00) for every Board meeting.
Section 11. Organization and Personnel. -The Board of Directors of the CNFDEZFA
shall provide for its organizaton and staff. The Board shall appoint and fix the renumeration
and  other emoluments  Of its offices  and employees in  accordance with existing  laws on
compensation and position classification. The Board shall have exclusive and final authority
to promote, transfer, assign, reassign or remove officers of the CNFDEZFA, any provision
of existing law to the contrary notwithstanding. The chairperson-administrator shall execute
the decisions of the Board.
The officers and employees of the CNFDEZFA, including all members of the Board,
shall not engage dirediy or indirectly in pandsan actvities nor take part in any election, except
to vote.
No officer or employee of the CNFDEZFA shall be removed or suspended except
for cause, as provided for by the civil service rules and regulatons.
Section  12.  Powers and Duties of the Chairperson-Administrator. -The Chairperson-
Administration shall have the following powers and duties:
a)          To direct and manage the affairs of the CEZA in accordance with the policies
of the Board;
b)          To establish the internal organization of the CEZA under such  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 annual
report to the Board and such other reports as may be required;
7


e)          To submit to the Board for its approval, policies, systems, procedures, rules
and regulations that are essendal to the operation of the Camarines Norte
lst District Ecozone;
I)           To recommend to the Board the renumeration and other emoluments of its
officers and employees in accordance with existing laws on compensation
and position classification:
g)          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 Ecozone; and
h)          To perform such other duties as may be assigned to him by the Board or
which are necessary or incidental to his office.
Section  13.  Legal  Counsel.  -The  CNFDEZFA  shall  have  its  own  internal  legal
counsel under the supervision of the government corporate counsel. When the exigencies
of its busjnesses and operatons demand it, the CNFDEZFA may engage the services of an
outside counsel either on a case to case or on a fixed retainer basis.
CHAPTER Ill
INCENTIVES TO ECOZONE ENTERPRISES AND INVESTORS
Section 14. Investors Vlsa. -Any foreign national who invests an amount of Two
hundred thousand US dollars (US$200,000.00) in a registered enterprise, either in cash or
equipment, shall be entitled to an investor's visa: Provided, that the foreign national has the
followi ng q ualifications;
a)   Must be at least 18 years of age;
b)   Must not  have  been  convicted  by final judgement of a  crime  involving  moral
turpitude;
c)   Must not be afflicted with any loathsome, dangerous or contagious disease;
d)   Must not have been confined in an institution for any mental disorder or disability;
and
e)   Must be financially capable as borne out by credible and verifiable evidence.
With an investor's visa, an alien shall be enffled to reside in the Philippines while his
investment subsists. The alien should submit an annual report, in the form duly prescribed
for the  purpose,  to  prove that the  investment in  the  country  subsists.  Should  said  alien
withdraw his investhents from the  Philippines,  then the investor's visa to said  alien shall
automatically expire and be withdrawn.
The  authority  to  issue  visas  and  work  permits  shall  remain  with  the  Bureau  of
Immigration  (81)  and  the  Department  Of  Labor  and  Employment  (DOLE),  respectively:
Provided, that the 81  and the DOLE shall implement measures to expedite the processing
of such  visas  and  permits  for workers  in  the  Ecozone  and  coordinate  closely  with  the
CNFDEZFA to facilitate the conduct of business operations.
8


Section  15.  Fiscal  Incentives.  -Registered  enterprises  of the  Ecozone  may be
entitled to perdnent fiscal incentives granted under Title X 111 ITax Incentives) of the National
lntemal Revenue Code, as amended.
I n the interest of enhancing transparency in the management and accounting of tax
incentives   in   the   Camarines   Norte   First   Disthct   Ecozone   and   ensuring   the   proper
administration,    management,    enforoement,    implementation,    and    monitoring    of   tax
incentives,  the  CNFDEZFA  shall  comply  with  the  provision  of  Republic  Act  No,10708,
otherwise known as the Tax Incentives Management and Transpareney Act ITIMTA)" and
its implementing rules and regulations.
The BOC shall set up and establish a custom€ontrolled area outside the premises
of the Camarines Norte First District Ecozone to facilitate payment of duties and taxes on
goods enteri ng the Philippine customs territory; Provided, that notwithstanding the limitations
on this ACT, the CNFDEZFA and BOC may coordinate and jointly implement measures on
border protection.
Section  16.  Banking Rules and Regulations Governing Banks and Other Financial
Institutions.  -Banks and  other BSP-supervised financial institutions to be established in
the Camarines Norte First District Ecozone shall be under the supervision of the BSP and
subject to existing banking laws, rules and regulations.
Section 17. Remittances. -in the case Of foreign investments, a duly registered entity
or enterprise within the Camarines Norte First District Ecozone shall have the right to remit
earnings to its investors in the currency in which the investhent was originally made and at
the exchange rate prevailing at the time of remittance, subject to the provisions of Republic
Act No. 7653, otherwise known as the WNew Central Bank Act" as amended.
CHAPTER IV
NAlloNAL GOVERNMENT AND OTHER ENTITIES
Section   18.   Supervision   and   Control.   -   For  purposes  of  policy   direction   and
coordination, the CNFDEZFA shall be under the direct control and supervision of the Office
of the President of the Philippines.
Section   19.  Relatonship  with  the  Local  Government  Unit.  -  Except  as  herein
provided, the Municipality of Jose Panganiban shall retain its basic autonomy and identity.
It shall operate and fundion in accordance with the framework of the Constitution, the Local
Government Code Of 1991,  as amended,  and this Act.  In case of any conflict among the
CNFDEZFA, the LGU and the national government on matters affecting the Ecozone, other
than national defense and security matters, the decision of the CNFDEZFA shall prevail.
Section 20. Audit. The Commission on Audit shall appoint a full-time auditor for the
CNFDEZFA and may assign such number of personnel as may be necessary to assist the
auditor in the performance of the auditor's fundions.
9


CHAPTER V
MISCELLAN EUOS PROVIsloNS
Section 21. Interpretation and Construdion. -The powers, authorities and functions
that are vested in the CNFDEZFA are intended to enhance national security, encourage self-
sufficiency, foster meaningful  decentralization of government functions and  authority,  and
promote  the  efficient  and  effedive  collaboration  among  the  CNFDEZFA,  the  national
government and the LGU of the Municipality of Jose Panganiban. Any interpretation of this
Act shall consider such intendons. In the event Of conflict of interpretaton and provided the
intentions cannot be harmonized, the provisions of this Act shall be construed in favor of an
i nterpretation that shall protect national security.
Section 22. Applicability Clause. - lnsofar as they are consistent with the provisions
of this Act, the provisions of Sections 30 to 41  of Republic Act No. 7916, Otherwise known
as  "The  Special  Economic  Zone  Act of  1995',  as  amended,  shall  likewise  apply to the
Ecozone.
Section  23.  Implementing  Rules  and  Regulations.  -  Within  sirty  (60)  days  from
effectivity of this Act, the DTl shall, in coordination with the DOF and the National Economic
and Development Authority, formulate rules and regulations for the effective implementation
of the provisions of this Act
Section   24.   Separabilfty  Clause.   -   lf  any  provision  of  this  Act  shall   be   held
unconstitutional  or invalid,  the other provisions not otherwise affected shall  remain  in full
foroe and effect.
Section 25. Repealing Clause. - All laws, executive orders or issuances or any part
thereof, which alie inconsistent herewith, are hereby repealed or amended accordingly.
Section 25. Effectivity. - This Act shall take effect fifteen (15) days after its publication
in the Official Gazette or in a newspaper of general circulation.
Approved.
10