~~; ," I» 
l" (-)' 
,~i!;:. _,.Ii 
SIXTEENTH CONGRESS OF THE REPUBLIC 
) 
(0ftHf llf Hit' ?)<'vrl?f.'lf~ 
OF THE PHILIPPINES 
) 
Second Regular Session 
) 
'15 
MAY 13 P 2 :29 
SENATE 
S.B. No. 
2764 
Introduced by: Senator Paolo Benigno "Bam" A. Aquino IV 
AN ACT AMENDING REPUBLIC ACT NO. 7227, as amended by REPUBLIC ACT NO. 9400, 
OTHERWISE KNOWN AS THE BASES CONVERSION AND DEVELOPMENT ACT OF 1992 
EXPLANATORY NOTE 
With the country experiencing sustained economic growth, we are flooded with 
opportunities for development in different industries and across a number of geographical 
areas in the country. 
Subic Bay in Central Luzon is one such region with immense potential for foreign 
investment and overall economic development. This economic development in the Subic Bay 
Freeport Zone (SBFZ) translates to job opportunities and business opportunities for our 
countrymen. 
With this in mind, the Republic Act No. 7227, otherwise known as the Bases Conversion 
and Development Act of 1992, was passed to assign Subic Bay Metropolitan Authority (SBMA) 
the responsibility to build a prosperous and self-sustaining Freeport in Subic Bay. 
SBMA is tasked to promote both economic and social development in Subic Bay, 
creating a model for economic success and inclusive growth in the region and in the Philippines. 
We are now in a position to clarify provisions of the decade-old legislation and apply 
revisions based on what we have learned in the past years, improving the policy and making 
SBMA a more effective and impactful governing body. 
The Subic Bay Metropolitan Authority (SBMA) Reform Bill seeks to update the powers 
and responsibilities of SBMA in the hope that SBFZ can reach its full potential- attracting more 
foreign direct investments, supporting growth of local business, providing jobs, livelihood, and a 
wealth of opportunities for more Filipinos in Central Luzon and in the country as well. 
Grow, Subic, grow! 
In view ofthe foregoing, approval of this bill is earnestly sought . 
.-;/)~ ~~.~ 
Senator pJr; ~enignO "B~ml1~. Aquino IV 


SIXTEENTH CONGRESS OF THE REPUBLIC 
) 
OF THE PHILIPPINES 
) 
Second Regular Session 
) 
'15 
MAY 13 P 2 :29 
SENATE 
S.B. No. 2764 
RECEIVED BY: __ ~~ 
Introduced by: Senator Paolo Benigno "Bam" A. Aquino IV 
AN ACT AMENDING REPUBLIC ACT NO. 7227, AS AMENDED BY REPUBLIC ACT NO. 9400, 
OTHERWISE KNOWN AS THE BASES CONVERSION AND DEVELOPMENT ACT OF 1992 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
1 
SECTION 1. Section 12 (c) of the Republic Act No. 7227, as amended, is hereby further 
2 
amended as follows: 
3 
"SECTION 12. Subic Special Ecanomic Zone. - xxxx 
xxxx 
xxxx 
4 
(c) The provision of existing laws, rules and regulations to the contrary notwithstanding, 
5 
no national and local taxes shall be imposed within the Subic Special Economic Zone. In lieu of 
6 
[said] ALL OTHER NATIONAL AND LOCAL taxes, a five percent (5%) tax on gross income earned 
7 
shall be paid by all business enterprises within the Subic Special Economic Zone and shall be 
8 
remitted as follows: [three percent (3%)] TWO PERCENT (2%) to the National Government, 
9 
[and] ONE PERCENT 
(1%) to the 
Subic 
Bay Metropolitan Authority (SBMA) AND TWO 
10 
PERCENT (2%) for distribution to the local government units affected by the declaration of and 
11 
contiguous to the zone, namely: the City of Olongapo and the municipalities of Subic, San 
12 
Antonio, San Marcelino and Castillejos of the Province of Zambales; and the municipalities of 
13 
Morong, Hermosa and Dinalupihan ofthe Province of Bataan, on the basis of population (50%), 
14 
land area (25%), and equal sharing (25%). 
15 
xxxx xxxx xxxx" 
16 
SECTION 2. Sections 13 (b) (3) (10) (11), (c) (3) (4) and (f) of Republic Act No. 7227, as 
17 
amended, is hereby amended to read as follows: (17) 
18 
" SEC. 13. Subic Bay Metropolitan Authority. - xxxx xxxx xxxx 
19 
(b) Powers and Functions of the Subic Bay Metropolitan Authority - The Subic Bay 
20 
Metropolitan Authority, otherwise known as the Subic Authority, HAVING AUTHORITY AND 
21 
JURISDICTION OVER ALL BUSINESS AND ECONOMIC ACTIVITIES WITHIN THE SBF, EXCEPT AS 
22 
OTHERWISE HEREIN PROVIDED, shall have the following powers and function: 
23 
xxxx xxxx xxxx 
1 


1 
(3) To undertake and regulate the establishment, operation and maintenance of 
2 
[utilities) TELECOMMUNICATIONS, other services and infrastructure in the Subic Special 
3 
Economic Zone including shipping and MARITIME related businessES, stevedoring 
4 
and port terminal services or concessions, incidental thereto and airport operations in 
5 
coordination with the Civil Aeronautics Board, and to fix AND IMPOSE just and 
6 
reasonable rates, fares charges and other prices therefor; 
7 
xxxx xxxx xxxx 
8 
(10) 
xxxx xxxx xxxx xxxx xxxx xxxx; [and) 
9 
(11) TO RECLAIM LANDS IN THE SUBIC SPECIAL ECONOMIC AND FREEPORT ZONE, NOT 
10 
LIMITED TO FORESHORE AND SUBMERGED AREAS, BY DREDGING, FILLING OR OTHER 
11 
MEANS, AND TO ACQUIRE, DEVELOP, IMPROVE, ADMINISTER, DEAL- IN, SUBDIVIDE 
12 
AND LEASE RECLAIMED LANDS INSIDE THE ZONE; TO PROVIDE FOR, 
OPERATE 
OR 
13 
ADMINISTER 
SUCH 
SERVICES 
AS 
MAY BE 
NECESSARY 
FOR 
THE 
EFFICIENT, 
14 
ECONOMICAL AND BENEFICIAL UTILIZATION OF THE RECLAIMED AREAS IN THE ZONE; 
15 
(12) To exercise such powers as may be essential, necessary or incidental to the powers 
16 
granted to it hereunder as well as to carry out the policies and objectives of this Act. 
17 
18 
(c) Board of Directors - The powers of the Subic Authority shall be vested in [the 
19 
exercised) AND exercised by a Board of Directors, hereinafter referred to as the Board, which 
20 
shall be composed offifteen (15) members, to wit: 
21 
xxxx xxxx xxxx 
22 
(3) Five (5) representatives from the private sector coming from [the present naval 
23 
stations, public works center, ship repair facility, naval supply depot and naval air 
24 
stations) TOURISM, MANUFACTURING AND PRODUCTION, MARITIME AND AVIATION, 
25 
TRADE AND INDUSTRY, AND LOGISTICS SECTORS; and 
26 
(4) The remaining balance to complete the Board shall be composed [to) OF 
27 
representatives from the 
business 
and 
investment sectors, WITH 
ONE 
(1) 
28 
REPRESENTATIVE FROM THE MUNICIPALITY OF DINALUPIHAN, PROVINCE OF BATAAN. 
29 
xxxx xxxx xxxx 
30 
(f) OTHER OFFICERS AND EMPLOYEES. - ALL POSITIONS IN THE SUBIC AUTHORITY 
31 
SHALL BE GOVERNED BY THE COMPENSATION, POSITION CLASSIFICATION SYSTEM 
32 
AND QUALIFICATION STANDARDS APPROVED BY ITS BOARD OF DIRECTORS BASED ON 
33 
A COMPREHENSIVE JOB ANALYSIS OF ACTUAL DUTIES AND RESPONSIBILITIES AT PAR 
34 
WITH THAT OF THE BASES CONVERSION AND DEVELOPMENT AUTHORITY (BCDA) OR 
35 
THE CONVERSION AUTHORITY. THE COMPENSATION PLAN SHALL BE COMPARABLE 
36 
WITH THE PREVAILING COMPENSATION PLANS IN THE PRIVATE SECTOR AND SHALL BE 
37 
SUBJECT TO PERIODIC REVIEW BY THE BOARD OF DIRECTORS OF THE SUBIC 
38 
AUTHORITY ONCE EVERY TWO (2) YEARS, WITHOUT PREJUDICE TO YEARLY MERIT OR 
39 
INCREASES BASED ON THE SUBIC AUTHORITY'S PRODUCTIVITY AND PROFITABILITY. 
40 
THE SUBIC AUTHORITY SHALL, THEREFORE, BE EXEMPT FROM EXISTING LAWS, RULES 
41 
AND 
REGULATIONS 
ON 
COMPENSATION, 
POSITION 
CLASSIFICATIONS 
AND 
42 
QUALIFICATION STANDARDS. HOWEVER, THE SUBIC AUTHORITY SHALL ENDEAVOR TO 
43 
MAKE ITS SYSTEM CONFORM AS CLOSELY AS POSSIBLE WITH THE PRINCIPLES UNDER 
2 


t 
" 
I 
REPUBLIC ACT NO. 6748 OR THE COMPENSATION AND POSITION CLASSIFICATION ACT 
2 
OF 1999 OTHERWISE KNOWN AS THE SALARY STANDARDIZATION LAW, AS 
3 
AMENDED." 
4 
SECTION 3. Implementing Rules and Regulations. - The OOF, in coordination with PEZA, 
5 
the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC), and in consultation 
6 
with the Bases Conversion Development Authority (BCOA), shall promulgate and publish the 
7 
necessary rules and regulations for the effective implementation of this Act within thirty (30) 
8 
days from the date of effectivity of this Act. 
9 
SECTION 4. Separability Clause. -
If any provIsion of this Act shall be held 
10 
unconstitutional or invalid, the other provisions not otherwise affected shall remain in full force 
II 
and effect. 
12 
SECTION S. Repealing Clause. - All laws, decrees, orders, proclamations, rules and 
13 
regulations or other issuances or parts thereof inconsistent with the provisions of this Act are 
14 
hereby repealed or modified accordingly. 
15 
SECTION 6. Effectivity. - This Act shall take effect fifteen (15) days after its publication 
16 
in the Official Gazette or in any two newspapers for general circulation. 
17 
Approved; 
3