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THIRTEENTH CONGRESS OF THE 
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REPUBLIC OF THE PHILIPPINES ) 
Third Regular Session 
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s.B. NO. 2603 
(In substitution ,of H. No. 5309) 
Prepared by the Committees on Economic Affairs; Local Government; ’Ways and Means; 
and Finance with Senators MAR Roxas, Alfred0 S. Lim, 
, and Franklin 
M. Drilon as authors thereof. 
AN ACT 
ESTABLISHING THE AURORA SPECIAL ECONOMIC ZONE IN THE 
PROVINCE OF AURORA, CREATING FOR THE PURPOSE THE AURORA 
SPECIAL ECONOMIC ZONE AUTHORITY, APPROPRIATING FUNDS 
THEREFOR AND FOR OTHER PURPOSES 
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 “Aurora Special 
Economic Zone Act of2006.” 
Sec. 2. Declaration of Policy. - It is hereby declared the policy of the State to 
actively encourage, promote, induce, and accelerate the sound and balanced industrial, 
economic and social development of the country in order to provide jobs to the people, 
especially those in rural areas, increase their productivity and their individual and family 
income, and thereby improve the level and quality of their living conditions through the 
establishment, among others, of special economic zones in suitable and strategic 
locations in the country and through measures that shall effectively attract legitimate and 
productive foreign investments. 
Sec. 3. Creation of the Aurora Special Economic Zone. - In pursuit of the 
foregoing declared policy and subject to the concurrence of the concerned local 
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government units of Aurora affected by the zone, there is hereby established a Special 
Economic Zone, hereinafter referred to as the Aurora Ecozone. The Aurora Ecozone shall 
cover the entire area embraced by the barangays of Esteves, Dibet and Dibacong, all in 
the municipality of Casiguran. The specific metes and bounds of the Aurora Ecozone 
shall be based on the following technical description, provided that the lands embraced 
therein shall be public lands: 
TECHNICAL DESCRIPTION OF THE PROPOSED 
AURORA SPECIAL ECONOMIC ZONE AREA 
LOCATED AT: BRGYS: ESTEVES, DIBET & DIBACONG 
MUNICIPALITY OF: CASIGURAN 


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PROVINCE OF: AURORA 
APPROX. AREA: 480 HAS. 
COR. 
1-2 
2-3 
3-4 
4-5 
BEARING & DISTANCE 
S 83"OO'W 
1,320 M 
N21'00'W 
N 55'00'E 
Following the Cash 
1,270 M 
3,000 M 
an Bay 
in a gen. SE, NW, SW, SE 
Directions. 
1,560 M 
s 4i0aa7w 
1,500 M 
REMARKS 
Cor. 1,2005 established 
GPS Survey Control Points 
ON THE GROUND 
ON THE GROUND 
Cor. 4, MOUTH OF 
DIBET RIVER 
Cor. 5, on the ground along 
the shoreline of 
CASIGURAN BAY 
Sec. 4. Governing Principles. - The Aurora Special Economic Zone shall be 
managed and operated by the Aurora Special Economic Zone Authority, herein referred 
to as the ASEZA, created under Section 10 of this Act, under the following principles: 
(a) 
Within the framework and limitations of the Constitution and applicable 
provisions of the Local Government Code, the Aurora Ecozone shall be developed into 
and 
operated as a 
decentralized, 
sklf-reliant and 
self-sustaining industrial, 
commercialitrading, agro-industrial, tourist, banking, financial and investment center 
with suitable residential areas. 
(b) 
The 
Aurora 
Ecozone 
shall 
be 
provided 
with 
transportation, 
telecommunications and other facilities needed to attract legitimate and productive 
investments, generate linkage industries and employment opportunities for the people of 
the Province of Aurora and its neighboring towns and cities. 
(c) 
The Aurora Ecozone may establish mutually beneficial economic relations 
with other entities or enterprises within the country or, subject to the administrative 
guidance of the Department o f  Foreign Affairs (DFA), the Philippine Economic Zone 
Authority (PEZA) and/or the Department of Trade and Industry (DTI), with foreign 
entities or enterprises. 
(d) 
Foreign citizens and companies owned by non-Filipinos in whatever 
proportion may set up enterprises in the Aurora Ecozone, either by themselves or in joint 
venture with Filipinos in any sector of industry, international trade and commerce within 
the Aurora Ecozone. 
(e) 
The areas comprising the Aurora Ecozone may be expanded or reduced 
when necessary. For this purpose, the ASEZA, in consultation with the local government 
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units, shall have the power to acquire either by purchase, negotiation or condemnation 
proceedings, any private land within or adjacent to the Aurora Ecozone for the following 
purposes: (a) consolidation of lands for Aurora Ecozone development; (2) acquisition of 
right of way to the Aurora Ecozone; and (3) the protection of watershed areas and natural 
assets valuable to the prosperity of the Aurora Ecozone. 
(f) 
Goods manufaciured by an Aurora Ecozone enterprise shall 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 
ASEZA, together with the PEZA, the Bureau of Customs and the DTI. However, in 
order to protect domestic industries, a Negative List of industries shall be drawn up and 
regularly updated by PEZA. Enterprises engaged in industries included in such Negative 
List shall not be allowed to sell their products locally. 
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(g) 
The national government shall maintain its ability to coordinate with the 
Aurora Ecozone and the local government units 
SEC. 5. Incentives to Registered Enterprises - The Aurora Special Economic 
Zone Authority (ASEZA) may administer the following incentives to the registered 
enterprises located therein to the extent of the activity/project: 
(A) 
Income Tax Holiday (ITH). - Registered enterprises shall be entitled to an 
income tax holiday from the start of their commercial operations to the extent of their 
activity under the following categories: 
Category A - Registered domestic enterprise located in highly developed areas, as 
determined by the Board of Inveslments (BOI), shall be entitled to a four-year 
income tax holiday. 
Category B - Registered domestic enterprise on the following shall be entitled to 
a six-year income tax holiday: 
(1) Located in less developed areas as defined by the BOI; or 
(2) Producing/rendering new products/services or having strong backward 
or forward linkages 
Category C - Registered export enterprise shall be entitled to a six- year income 
tax holiday: Provided, however, That if the export enterprise complies with the 
Coollowing: (1) large capital investments or sizeable employment generation, or 
(2) use high level of technology or (3) located outside Metro-Manila, it shall be 
entitled to an eight-year income tax holiday. 
Registered enterprises embarking on new investments that are listed in the current 
Investment Priorities Plan (IPP) shall be entitled to incentives provided herein pertaining 
to the new investments and subject to such terms and conditions as the BO1 may 
determine. 
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For this purpose, a registered enterprise shall be defined as any person, natural or 
juridical, licensed to do business in the Philippines and registered with the Aurora Special 
Economic Zone Authority (ASEZA) lo transact business within the Aurora Special 
Economic Zone. A registered export enterprise shall be defined as any registered 
enterprise engaged directly or indirectly in the production, manufacture or trade of 
products or services which earns at least seventy percent (70%) of its normal operating 
revenues from the sale of its products or services abroad for foreign currency. A 
registered domestic enterprise, meanwhile, shall be defined as any registered enterprise 
not falling under the definition of a registered export enterprise. 
Additional investments in the project shall be entitled to the income tax holidays 
corresponding to such investments as may be determined by the BOI. Additional income 
tax holiday may be granted for as long as the investment is made on the same project: 
Provided, That the project is listed in the IPP at the same time the additional investment 
in the project is made: Provided, further, That the entitlement period for additional 
investments shall not exceed three times the period provided under this subsection: 
Provided however, That the total ITH period for an export enterprise availing of an eight 
year IT11 shall not exceed twenty (20) years. Any unused incentives shall therefore be 
deemed forfeited if not used during the incentive period. 
Enterprises registered with ASEZA are required to share in the special 
development fnnd of the BO1 for investment promotion projects of the government 
equivalent to one percent (1%) of the ITH granted for every application. 
The Bureau of Internal Revenue (BIR) shall require a registered enterprise 
availing of ITH or Net Operating Loss Carryover (NOLCO) to secure a certificate of 
eligibility from the ASEZA before submitting its income tax return (ITR) with ASEZA 
for validation. 
Failure to secure certification and/or to file the ITH or NOLCO availment for 
validation by the ASEZA within forty-five (45) days from the last day of each statutory 
filing date for ITR shall cause the forfeiture of the availment for the taxable period. 
(B) 
Net Operating Loss Carryover (NOLCO). - Net operating loss of the 
business or enterprise during the first three years from start of commercial operations 
which have not been previously offset as deduction from gross income shall be carried 
over as a deduction from gross income for the next five consecutive years immediately 
following the year of such loss: Provided however, That operating loss resulting from 
availment of incentives provided in this Act shall not be entitled to NOLCO. 
Registered enterprises availing of the ITH as herein provided shall not be entitled 
to avail of the NOLCO. 
(C) Imposition of a tax rate of five percent (5%) on Gross Income Earned (GIE). - 
Except for real property tax on land, no local and national taxes as prescribed under 
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Republic Act No. 8424, also known as “The National Internal Revenue Code of 1997, as 
Amended” such as income tax, excise tax, and franchise taxes, shall be imposed on 
registered enterprises operating within the Aurora Ecozone. In lieu thereof, five percent 
(5%) of the gross income earned shall be paid as follows: 
(a) Three percent (3%) to the national government; 
(b) Two percent (2%) shall be remitted by the business establishments to the 
treasurer’s office of the municipality or city where the enterprise is located; 
All persons and service establishments in the Aurora Ecozone shall be subject to 
national and local taxes under the National Internal Revenue Code of 1997, as amended, 
and the Local Government Code. 
D. Accelerated Depreciation. - Accelerated depreciation of plant, machinery and 
equipment that are reasonably needed and actually used for the production and transport 
of goods and services may be allowed using a rate not exceeding twice the rate wltich 
would have been used had the annual allowance been computed in accordance with the 
rules and regulations prescribed by the Secretary of Finance and the provisions of the 
National Internal Revenue Code (NIRC) of 1997, as amended. 
E. 
Capital Equipment Incentives. - (1) Importations of capital equipment, spare 
parts, tools and dye, or those required for pollution abatement and control, cleaner 
production and waste reduction including consignment thereof by registered enterprises 
upon the effectivity of this law, shall be exempted to the extent of one hundred percent 
(100%) of the taxes and customs duties: Provided, That the imported items thereof shall 
be used exclusively by the registered enterprise in its registered activity. Provided, 
further, That the importation of machinery and equipment and accompanying parts shall 
comply with the following conditions: 
1. 
comparable quality and at reasonable prices; 
ii. 
They are reasonably needed and will be used exclusively by the registered 
enterprise in the manufacture of its products, unless prior approval of the ASEZA 
is secured for the part time utilization of said equipment in a non-registered 
activity to maximize usage thereof or the proportionate taxes and duties are paid 
on a specific equipment and machinery being permanently used for non-registered 
activities; and 
iii. 
importation of such machinery, equipment and spare parts. 
Approval of the ASEZA must be secured before any sale, transfer or disposition 
of the imported capital equipment, machinery or spare parts is made: Provided, That if 
such sale, transfer or disposition is made within the first five years from date of 
importation, any of the following conditions must be present: 
They are not manufactured domestically in sufficient quantity, of 
Approval of the ASEZA was obtained by the registered enterprise for the 
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1) 
The same is made to another enterprise enjoying tax and duty 
exemption on imported capital equipment; 
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2) 
The same is made to another enterprise, upon the payment of any taxes 
and duties on the net book value of the capital equipment to be sold; 
The exportation of the capital equipment, machinery, spare parts or 
source documents or those required for pollution abatement and 
control; or 
Proven technical obsolescence of the said equipment, machinery or 
spare parts. 
3) 
4) 
When the aforementioned sale, transfer or disposition is made under any of the 
conditions provided for in the foregoing paragraphs other than paragraph (2) herein, the 
registered firm shall not pay the taxes and duties waived on such items: Provided> 
further, That if the registered enterprises sell, transfer or dispose the aforementioned 
imported items without prior approval within five years from the date of importation, the 
registered enterprise and the vendee, transferee, or assignee slliall be solidarily liable to 
pay twice the amount of the tax and duty exemption given it: Provided $nuliy, That 
even if the sale, transfer or disposition of the capital equipment, machinery or spare parts 
is approved after five years from date of importation, the registered enterprises are still 
liable to pay the taxes and duties based on the net book value of the capital equipment, 
machinery or spare parts if any of the registration terms and conditions has been violated. 
Otherwise, they shall no longer be subject to the payment of the taxes and duties waived 
thereon. 
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(2) 
The purchase of machinery, capital equipment, raw materials, supplies, 
parts and semi-finished products to be used in the fabrication of machinery and capital 
equipment by a registered export-oriented enterprise from a doinestic manufacturer shall 
be subject to zero percent (0%) value-added tax. 
The registered export-oriented enterprise shall be grant'ed a tax credit equivalent 
to the amount of duties that would have been waived on the machinery; capital 
equipment; raw materials, supplies, parts and semi-finished products used in the 
fabrication of machinery and capital equipment, had these items been imported, upon its 
submission to the DOF of the bill of materials evidencing the transaction value of such 
and other pertinent documents, for verification and proper endorsement. 
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The availment by a registered export enterprise of the incentive stated under the 
immediately preceding two paragraphs shall be subject to the following conditions: (a) 
That said capital equipment, machinery and spare parts will be used exclusively by the 
registered enterprise in its registered activity; 
(b) That the capital equipment or 
machinery where the raw materials, supplies, parts and semi-finished products were used 
would have qualified for tax and duty-free importation; and (c) That the approval of the 
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ASEZA is obtained by the registered enterprise. If the registered enterprise sells, transfers 
or disposes of these machineries, capital equipment and spare parts, the provision in the 
preceding paragraphs for such disposition shall apply. 
This incentive shall be deemed waived if application for tax credit under this 
subsection was not filed within one year from date of delivery 
F. 
The importation of source documents by information technology- 
registered enterprises shall be eligible for tax and duty iiiee importation. 
G. 
Raw Materials Incentives. - Every registered export-oriented enterprise 
shall enjoy a tax credit equivalent to the internal revenue taxes and customs duties paid 
on the supplies, raw materials and semi-manufactured products provided the same are not 
sufficient in quantity, quality or are not competitively priced in the Philippines and which 
are used in the manufacture, processing or production of its export products forming part 
thereof, exported directly and indirectly by the registered export-oriented enterprise, 
based on the actual taxes and duties paid for such materialslsuppliesisemi-manufactured 
products by the registered enterprise. 
This incentive shall be deemed waived if application for tax credit under this 
subsection was not filed within one year from date of exportation of the final product. 
H. Incentives on Breeding Stocks ,and Genetic Materials. - Importation of 
breeding stoclts and genetic materials within ten (10) years from the date of registration 
of commercial operation of the enterprise shall be exempt from all taxes and duties: 
Provided, That such breeding stocks and genetic materials are reasonably needed in the 
registered activity; and approved by the ASEZA. 
The availment of the incentives by the registered enterprise shall be subject to the 
following: (a) that said breeding stoclts and genetic materials would have been qualified 
for tax and duty-free importation under the preceding paragraph; (b) that the breeding 
stocks and genetic materials are reasonably needed in the registered activity; (c) that 
approval of the ASEZA has been obtained by the registered enterprise; and (d) that the 
purchase is made within ten (10) years from the date of registration of commercial 
operation of the registered enterprise. 
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This incentive shall be deemed waived if application for tax credit under this 
subsection is not filed within one year from date of delivery. 
I. 
Exemption from Wharfage Dues. - The provisions of law to the contrary 
notwithstanding, exports by a registered enterprise shall be exempted from wharfage 
dues. 
J. Deferred Imposition of the Minimum Corporate Income Tax. - The Minimum 
Corporate Income Tax (MCIT) of two percent (2%) of the gross income as of the end of 
the taxable year shall be imposed when the MCIT is greater than the income tax 
computed under the NIRC of 1997, as amended, for the taxable year: Provided, however, 
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That said MCIT shall be imposed only after the enterprise’s entitlement period to the 
income tax-based incentives has expired 
K. Tax Treatment of Merchandise in the Aurora Ecozone. - 
a. Domestic merchandise sent from the Aurora Ecozone to areas outside the 
said Ecozone shall, whether or not combined with or made part of other 
articles likewise of local origin or manufactured in the Philippines while in 
the export processing zone, be subject to internal revenue laws of the 
Philippines as domestic goods sold, transferred or disposed of for local 
consumption. 
b. Merchandise sent from the Aurora Ecozone to areas outside the said 
Ecozone shall, whether or not combined with or made part of other articles 
while in the zone, be subject to rules and regulations governing imported 
merchandise. The duties and taxes shall be based on the value of said 
imported materials (except when the final product is exempt). 
c. Articles produced or manufactured in the Aurora Ecozone and exported 
therefrom shall, on subsequent importation into the customs .. territory, be 
subject to the import laws applicable to like articles manufactured in a 
foreign country. 
d. Unless the contrary is shown, merchandise taken out of the Aurora 
Ecozone shall be considered for tax purposes to have been sent to customs 
territory. 
Tax Treatment of Raw Materials and Capital Equipment in the Aurora 
Ecozone. - Importations of raw materials and capital equipment shall be treated as in the 
Omnibus Investments Code 
M. 
Importations of raw materials and capital equipment shall be treated as in the 
Omnibus Investments Code. Registered export oriented enterprise shall have access to the 
utilization of the bonded warehousing system in accordance with the rules and 
regulations of the Bureau of Customs. 
L. 
N. 
Employment of Foreign Nationals. - Subject to the provisions of Section 
29 of Commonwealth Act No. 613, as amended, a registered enterprise may employ 
foreign nationals in supervisory or technical positions for a period not exceeding ten (10) 
years from its registration: Provided, That when the majority of the capital stock of a 
registered enterprise is owned by foreign investors, the positions of the president, 
treasurer and general manager or their equivalents may be retained by foreign nationals 
beyond the period set forth herein and such officer is the owner or a stoclcholder owning 
at least ten percent (10%) of the outstanding capital stock of the registered enterprise and 
he remains the owner or maintains his stoclcholdings therein. 
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Foreign nationals under employment contract within the purview of this incentive, 
their spouses and unmarried children under twenty-one (21) years of age, who are not 
excluded by Section 29 of Commonwealth Act No. 613, as amended, shall-be permitted 
to enter and reside in the Philippines during the period of employment of such foreign 
nationals. They shall be entitled to a multiple entry visa, valid for a period of three years, 
and shall be allowed to enter and leave the Philippines without futher documentary 
requirements other than valid passports or other travel documents in the nature of 
passports. The validity of the multiple entry visa shall be extendible yearly. 
The said foreign nationals admitted under this provision, as well as their 
respective spouses and dependents shall be exempt from: (a) obtaining alien certificate 
of registration and immigration clearance certificates; and (b) securing the Alien 
Employment Permit (AEP) and all types of clearances, permits, licenses or their 
equivalents required by any government department or agency. 
Sec. 6. Incentive to Investors. - Any foreign national covered under Subsection 
(M) of Section 5 of this Act, who invests an amount of US $ 150,000.00, either in cash 
and/or equipment, in a registered enterprise shall be entitled to an investor’s visa: 
Provided, ’That, 
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(1) He is at least eighteen (18) years of age; 
(2) He has not been convicted of a crime involving moral turpitude; 
(3) He is not afflicted with any loathsome, dangerous or contagious disease; and 
(4) He has not been institutionalized for any mental disorder or disability. 
Provided, further, That in securing the investor’s visa, the alien-applicant shall be entitled 
to the same privileges provided for under paragraph (M), Section 5 hereof. 
As a holder of 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. 
Sec. 7. Administration, Implementation and Monitoring of Incentives. - The 
ASEZA shall be responsible for the administration and implementation of the incentives 
granted to its respective registered enterprises: 
Provided, That any incentive 
administration policy adopted by the BO1 for registered enterprises shalI be uniformly 
applied by ASEZA. 
The following are the duties and responsibilities of the ASEZA in the 
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administration of incentives: 
(A) To adopt consistent procedures of administering incentives in accordance 
with the guidelines established by the BOI; 
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To adopt and implement systems and procedures affecting trade and 
customs policies in accordance with the requirements established by the 
Department of Finance (DOF) and the BOI; 
To submit information on registered enterprises to the DOF and the BO1 as 
required by any of these agencies to ascertain consistency of investment 
policies and incentives, including their implementation as provided in 
paragraph (a) herein, and to ensure proper implementation of systems and 
procedures affecting trade and customs policies as provided in paragraph (b) 
herein; and 
To perform all other duties and responsibilities as may be required by the 
President of the Philippines. 
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For proper monitoring, the BO1 shall create a single database of all incentives 
provided by all incentives granting agencies, including ASEZA, and all information 
thereto. Double entry accounting shall be done by the BO1 in recording all incentives 
granted by the government for transparency purposes. 
Sec. 8. Extension of Period of Avuilment. - The availment period of the 
incentives provided herein may be extended by ASEZA, in the event that the registered 
enterprise suffers operational force majeure or any event equivalent thereto, impairing its 
viability, provided that the availment period shall not exceed the duration of the said 
force mujeure or equivalent event. 
Sec. 9. Duration oflncentives. - Enterprises registercd with ASEZA may enjoy 
ITH or NOLCO granted by the latter prior to the availment of the five percent (5%) GIE. 
Fiscal incentives under this Act shall he terminated after a cumulative period of 
twenty (20) years from date of registration or start of commercial opcration, whichever is 
applicable, except that it could be extended with regard to industries deemed 
indispensable to national development. 
The industries exempted from this provision shall be recommended by BOI, with 
the concurrence of the Secretaries of the Department of Finance and Trade and Indushy. 
Sec. 10. Creation of the Aurora Special Economic Zone Authority. - There is 
hereby created a body corporate to be known as the Aurora Special Economic Zone 
Authority, hereinafter referred to as the ASEZA, which shall manage and operate, in 
accordance with the provisions of this Act, the Aurora Special Economic Zone. This 
corporate franchise shall expire in fifty (50) years counted fiom the first day of the fifth 
(5"') calendar year after the effectivity of this Act, unless otherwise extended by 
Congress. It shall be organized within one hundred eighty (180) days after the effectivity 
of this Act. 
Sec. 11. Principal Office of ASEZA. - The Aurora Special Economic Zone 
Authority shall maintain its principal office in the Municipality of Casiguran, but it may 
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establish branches within the Philippines as may be necessary for the proper conduct of 
its business. 
SEC. 12. Powers and Functions of the Aurora Special Economic Zone 
- The Aurora Special Economic Zone Authority shall have the following 
Amtho&. 
powers and functions: 
(a) To operate, administer, manage and develop the Aurora Ecozone according to 
the principles and provisions set forth in this Act; 
(b) To register, regulate and supervise the enterprises in the Aurora Ecozone in 
an efficient and decentralized manner, subject to existing laws; 
(c) To coordinate with local government units and exercise general supervision 
over the development plans, activities and operations of the Aurora Ecozone; 
(d) To regulate and undertake the establishment, operation and maintenance of 
utilities, other services and infrastructure in the Aurora Ecozone such as but 
not limited to heat, light and power, water supply, telecommunications, 
transport, toll roads and bridges, port services, etc. and to fix just, reasonable 
and competitive rates, fares, charges and prices thereoe 
(e) To construct, acquire, own, lease, operate and maintain on its own or through 
contracts, franchise, licenses, bulk purchase from the private sector or permits 
under any of the schemes allowed in Republic Act No. 6957 (the Build- 
Operate-Transfer Law, as amended by RA 7718), or joint venture, adequate 
facilities and infrastructure required or needed for the operation and 
development of the Aurora Ecozone, in coordination with appropriate 
national and local government authorities and in conformity with applicable 
laws ihereon; 
(r) To operate on its own, either directly or through a license to other tourism- 
related activities, including games, amusements, recreational arid sports 
facilities; 
(g) Subject to the approval of the President and the Monetary Board of the 
Bangko Sentral ng Pilipinas upon the recommendation of the Department of 
Finance, to raise or borrow adequate and necessary funds from local or 
foreign sources to finance its projects and programs under this Act, and for 
that 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 assets; 
(h) To protect, preserve, maintain and develop the virgin forests, beaches, coral 
and coral reefs and maintain ecological balance within the Aurora Ecozone; 
(i) ‘To create, operate and/or contract to operate such functional units of offices 
of the ASEZA as it may deem necessary; 
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(j) To adopt, alter and use a corporate seal; make contracts, leases, own, or 
otherwise dispose of personal or real property; sue and be sued; and otherwise 
carry out its functions and duties as provided for in this Act; 
(IC) To issue certificates of origin for products manufactured or processed in the 
Aurora Ecozone in accordance with prevailing rules of origin, and the 
pertinent regulations of the PEZA, DTI and/or the Department of FinanGe 
(DOF); 
To issue working visas renewable every two (2) years to foreign executives 
and foreign technicians with highly specialized skills which no Filipinos 
possesses, as certified by the Department of Labor and Employment; 
(m) To report to the Bureau of Immigration the names of the foreigners who have 
been granted permanent resident status and working visas within thirty (30) 
days after issuance of such grant; 
(n) To exercise such powers as maybe 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 
(0) To issue rules and regulations consistent with the provisions of this Act as 
maybe necessary to accomplish and implement the purposes, objectives and 
policies provided herein. 
Sec. 13. Banking Rules and Regulations. -Existing laws and rules/regulations of 
the Bangko Sentrul ng Pilipinas (BSP) shall apply to banks and financial institutions to 
be established in the Aurora Ecozone, such as those governing foreign exchange and 
other concurrent account transactions (trade and non-trade), local and foreign borrowings, 
foreign investments, establishment and operation of local and foreign banks, foreign 
currency deposit units, offshore banking units and other financial institutions under the 
supervision of the BSP. 
Sec. 14. Remittance of Earnings. - In the case of foreign investments, a 
registered enterprise in the ASEZA shall have the right to remit earnings from the 
investment in the currency in which the investment was originally made and at the 
exchange rate prevailing at the time of remittance, subject to the provisions of Section 74 
of Republic Act No. 265, as amended. 
Sec. 15. Board of Directors of the Aurora Special Economic Zone Authoriw. - 
The powers of the Aurora Special Economic Zone Authority 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) The Chairman who shall, at the same time be the administrator of the ASEZA; 
b) A Vice-chairman who shall come from among the members of the Board; 
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c) Members consisting of: 
(1) The Governor of the Province of Aurora; 
(2) The Congressional Representative of the district covering the site of 
the Aurora Ecozone; 
(3) l h e  mayor of the Municipality of Casiguran, Province of Aurora; 
(4) One (1) representative from the domesiic investors; 
(5) One (1) representative from the foreign investors; and 
(6) Two (2) representatives from the workers working in Aurora Ecozone. 
The Governor, the Congressional representative and the mayor of the 
Municipality of Casiguran, Province of Aurora shall serve as ex-oficio members of the 
Board, whose term in the Board corresponds to their term as elected officials. 
The Chairman and the members of the Board, except the ex-ofjcio 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 resignation, or removal for cause. 
In case of death, resignation or removal for cause, the replacement shall serve only the 
unexpired portion of the term. 
Except for the representatives of the business and labor sectors, no person shall be 
appointed by the President of the Philippines as a member 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 (IO) years relevant working 
experience preferably in the field of management or public administration. 
The Members of the Board shall each receive per diem at rate to be determined by 
the Department of Budget and Management in accordance with existing rules and 
regulations: Provided, however, That the total per diem collected each month shall not 
exceed the equivalent per diem for €our (4) meetings. Unless and until the President of 
the Philippines has fixed a higher per diem for the members of the board, such per diem 
shall not be more than ten thousand pesos (P10,OOO.OO) for every Board meeting. 
Sec. 16. Powers and Duties of the Chairman-Administrator. - The Chairman- 
Administrator shall have the following powers and duties: 
a) 
To direct and manage the affairs of the ASEZA in accordance with the 
policies ofthe Board; 
To establish the internal organization of the ASEZA under such 
conditions that the Board may prescribe; 
To submit an annual budget and necessary supplemental budget to the 
Board for its approval; 
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; 
b) 
c) 
d) 
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e) 
To submit to the Board for its approval policies, systems, procedures, 
rules and regulations that are essential to the operation of the Aurora 
Ecozone; 
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 Aurora Ecozone; and 
To perform such other duties as may be assigned to him by the Board or 
which are necessary or incidental to his office. 
Sec. 17. Organization and Personnel. - The Board of Directors of the ASEZA 
shall provide €or an organization and staff of its officers and employees. 
Upon 
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 on compensation and position classification: Provided, That the Board 
shall have exclusive and final authority to promote, transfer, assign or reassign officers of 
the ASEZA, any provision of existing law to the contrary notwithstanding: Provided, 
further, That the Chairman-Administrator may carry out removal of such officers and 
employees. 
f) 
8) 
The officers and employees of the ASEZA, including all Members of the Board, 
shall not engage directly or indirectly in partisan activities nor take part in any election, 
except lo vote. 
No officer or employee of the ASEZA, subject to Civil Service laws and 
regulations, shall be removed or suspended except for cause, as provided by law. 
Sec. 18. Ipso Facto Clause. - Sections 30-41 of Republic Act 7916, shall ipso 
facto apply to the Aurora Special Economic Zone. 
Sec. 19. Capitalization. - The Aurora Special Economic Zone Authority shall 
have an authorized capital stock of One Billion (1,000,000,000) no par shares with a 
minimum issue of Ten Pesos (P10.00) each, the majority shares of which shall be 
subscribed and paid for by the National Government and the Local Government Units 
(LGUs) embracing the Aurora Special Economic Zone. The Board of Directors of the 
ASEZA 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 ASEZA to 
the general public under such policy as the Board and the Secretary of Finance may 
determine. The National Government and the LGUs shall in no case own less than sixty 
per centum (60%) of the total issued and outstanding capital of the Aurora Special 
Economic Zone Authority. 
The amount necessary to subscribe and pay for the shares of the National 
Government to the capital stock of the ASEZA shall be included in the Annual General 
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Appropriations Act. 
allotment and other local funds 
For LGUs, the funds shall be taken from their internal revenue 
Sec. 20. Supervision. - The Aurora Special Economic Zone shall be under the 
direct control and supervision of the Philippine Economic Zone Authority (PEZA) for 
purposes of policy direction and coordination 
Sec. 21. Relutionship with the Regionul Development Councif, - The Aurora 
Special Economic Zone Authority shall determine the development goals for the Aurora 
Ecozone within the framework of national development plans, policies and goals. The 
Administrator shall, upon approval by the Board, submit the Aurora Ecozone plans, 
programs and projects to the Regional Development Council for inclusion and inputs to 
the overall regional development plan. 
Sec. 22. Relationship with Local Government Units. - Except as herein 
provided, the local government units comprising the Aurora Special Economic Zone shall 
retain their basic autonomy and identity. The barangays of Esteves, Dibet and Dihacong, 
all in the municipality of Casiguran shall operate and function in accordance with the 
Local Government Code of 1991. In case of any conflict between the ASEZA and the 
Province of Aurora on matters affecting the Aurora Ecozone other than defense and 
security matters, the decision of the ASEZA shall prevail. 
Sec. 23. Inter~retation/Construction. - The powers, authorities and functiolis 
that are vested in the ASEZA are intended to decentralize governmental functions and 
authority and promote an efficient and effective working relationship between the Aurora 
Ecozone, the NG, and the local government units. 
Sec. 24. Auditing. - The Commission on Audit shall appoint a representative 
who shall be a full time auditor of the ASEZA and assign such number of personnel as 
may be necessary to assist said representative in the performance of hisher duties. The 
salaries and emoluments on the assigned auditor and personnel shall be in accordance 
with pertinent laws, rules and regulations. 
Sec. 25. Separabiiity Cfause. - If any provisions of this Act shall be held 
uncoiistitutional or invalid, the other provisions not otherwise affected shall remain in full 
force and effect. 
Sec. 26. Repealing Ciuuse. - All laws, executive orders and issuances, or any 
parts thereof, which are inconsistent herewith are hereby repealed or amended 
accordingly. 
See. 27. Effectivity Clause. - This Act shall take effect upon its publication in at 
least one (I) newspaper of general circulation. 
Approved, 
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