(2) amo031413-rp laws foreign investments.ppt

DOING BUSINESS IN THE PHILIPPPINES

INVESTMENT LAWSBusiness One-Stop Shop (BOSS) Action Center

BOSSAC

PHILIPPINE LAWS ON FOREIGN INVESTMENTS

Omnibus Investments Act (EO226)

(Administered by BOI)WITH

Incentives

Economic Zones and Freeports

WITH Incentives

R.A. No. 7042 FOREIGN

INVESTMENTS ACT NEGATIVE LIST

"Annex A"

Doing Business WITHOUT INCENTIVES

Doing Business WITH INCENTIVES

Representative/ Branch Office

E.O226-BK III-R. A. 8756-Regional

Headquarters (RHQ)

/Regional Operating

Headquarters (ROHQ)

R. A. No. 8762 Retail Trade

Law

E.O226-BK V-Special Investor’s Resident

Visa

E.O. No. 1037-

Special Resident Retiree’s

Visa

E.O. No. 758-Special Visa

for Employment Generation

Foreign Investments

Act (FIA)WITHOUT Incentives and NOT in the Negative

List




Incentives


WITH Incentives

FOREIGN INVESTMENTS ACT

NEGATIVE LIST"Annex A"




Regional Headquarters

(RHQ) /Regional Operating

Headquarters (ROHQ)

Retail Trade Law

Special Investor’s Resident

Visa


Visa

Special Visa for

Employment Generation

Foreign Investments


List


Doing Business WITHOUT Incentives



60 Filipino/40 Foreign:

- Paid-in capital can be less than US$ 200T

Foreign Investments ActDoing Business WITHOUT Incentives

and NOT in the Negative List

More than 40% ForeignA. Domestic Market Oriented at least US$200T

paid-in capital or US$100T if: 1. Activity involves advance technology or, 2. Company employs at least 50 direct employees

B. Export Oriented A manufacturer that exports at least 60% of its output;or a trader that purchases products domestically andexport at least 60% of its purchases.- US$ 200T paid-in, not applicable




Incentives


WITH Incentives








Headquarters (ROHQ)

Retail Trade Law

Special Investor’ Resident

Visa


Visa

Special Visa for


Foreign Investments


List


Doing Business WITH Incentives

Economic Zone and Freeports

PEZA - RA 7916 CDC - RA 7227SBMA -RA 7227CEZA - RA 7922PHIVIDEC - PD 538

Location - in Economic Zone and Freeports

- 100% for export regardless of ownership and status

- Needs zone authority to sell 30% to 50% in the domestic market but subject to payment of taxes and duties


Doing Business WITH Incentives

Export Oriented

Whether Pioneer or Non Pioneer Status If 60% Filipino/40% Foreign • 50% for Export.

If more than 40% Foreign owned• 70% for Export

For Domestic Market

- Activity is listed in the IPP

If Pioneer Status- can be 100% owned by foreigners

If Non-Pioneer Status-foreign equity is up to 40% only

"See IPP"

EO 226 - Registration with BOI




Incentives


WITH Incentives








Headquarters (ROHQ)

Retail Trade Law


Visa


Visa

Special Visa for


Foreign Investments


List


BRANCH OFFICE

REPRESENTATIVE OFFICE

- Needs SEC Registration as a BRANCH

- Carries out business activities of parent company

- Assigned capital from Head Office at least US$200T can be reduced to US$100T if : 1.Activity involves advanced technology or 2. Company employs at least 50 direct employees

- Needs SEC Registration as a REPRESENTATIVE OFFICE

- Extension of the personality of its mother company

- Activities limited only to liaison work between mother company and its clients - Does not derive income - One time remittance from mother company in the amount of at least US$ 30T to be used for its operational expenses




Incentives


WITH Incentives

FOREIGN INVESTMENTS ACT NEGATIVE LIST

"Annex A"






Headquarters (ROHQ)

Retail Trade Law


Visa


Visa

Special Visa for


Foreign Investments


List


Regional Headquarters (RHQ) /Regional Operating Headquarters (ROHQ)

RHQ ROHQ

- Endorsed by BOI to SEC- Needs SEC Reg.

- Annual remittance of at least US$ 50T

CONDITIONS: a.Functions -supervisory -communication -coordination

b.Does not earn income in the Philippines

- With Incentives

- Endorsed by BOI to SEC- Needs SEC Reg.

- One time remittance of at least US$ 200T

CONDITIONS: a. Functions - RHQ functions - Perform qualifying services to its affiliates, subsidiaries, and branches

b.Earn income from qualifying services subject to 10% tax

- With Incentives




Incentives


WITH Incentives








Headquarters (ROHQ)


Visa


Visa

Special Visa for


Foreign Investments


List

Retail Trade Law


Retail Trade Law

PREQUALIFICATION REQUIREMENTS:Before a foreign retailer is allowed to establish or organize an entity that will engage in the retail business or invest in a retail store in the Philippines, it must possess all of the following qualifications :a) A minimum of US$200 million net worth of the registrant corporation for Categories B, and US50 million net

worth of the registrant corporation for Category D;b) Five (5) retailing branches or franchise anywhere around the world unless such retailer has at least one (1)

store capitalized at a minimum of US$25 million;c) Five (5) - year track record in retailing; andd) Nationals from, or juridical entities formed or incorporated in countries which allow the entry of Filipino

retailers shall be allowed to engage in retail trade in the Philippines.

- For Category B, Paid up capital should be at least US2.5 million for general merchandize store and each branch should not be less than US$830,000- For Category D, high end or luxury product, the paid up capital should not be less than US$250,000 per store

- Pre-qualified by BOI & endorsed to SEC- Needs SEC Reg.

BOI




Incentives


WITH Incentives








Headquarters (ROHQ)

Retail Trade Law


Visa

Special Visa for


Foreign Investments


List


Visa


Special Investor’s Resident Visa (SIRV)

PREQUALIFICATION REQUIREMENTS:- He has not been convicted of a crime involving moral turpitude.- He is not afflicted with any loathsome, dangerous or contagious disease- He has not been institutionalized for any mental disorder or disability

- Applicant is at least 21 years old- Amount of investments is at least US$75,000. (This was lowered to US$50,000, for Tourism Related

Projects under E.O. 63 and shall be filed with Dept. of Tourism)

- Only investments/shares of stocks in existing, new or proposed corporation shall be allowed/accepted as eligible forms of investments: - Publicly-listed companies - Co. engaged in areas listed in the Investments Priorities Plan (IPP) of the BOI - Co. engaged in the manufacturing and services sectors

- Approved by BOI - Issuance of Visa endorsed to Bureau of Immigration

BOI




Incentives


WITH Incentives








Headquarters (ROHQ)

Retail Trade Law


Visa

Special Visa for


Foreign Investments


List


Visa


Special Resident Retiree’s Visa (SRRV) Philippine Retirement Authority (PRA)

REQUIREMENTS SRRV SMILE SRRV CLASSIC SRRV HUMAN TOUCH SRRV COURTESY

Age and Visa Deposit

1. 35 yrs. Old & above - US$20,000

NOTE: Additional Visa deposit - US$15,000.00 per dependent in excess of two (2).

1. 35 to 49 yrs. Old - US$50,0002. 50 yrs. Old & above : • Without Pension - US$20,000 • With Pension - US$10,000

NOTE: Additional Visa deposit - S$15,000.00 per dependent in excess of two (2).

Show proof of monthly pension remitted to the Philippines (US$800.00 for single applicant and US$1,000.00 for married couples)*

1. 35 yrs. Old & above - US$10,000

NOTE: Retiree must:Be shown to have a pre-existing condition (except contagious diseases) and in need of medical care and services.Show proof of monthly pension remitted to the Philippines equal to at least US$1,500.00.

1. 35 yrs. Old for Former Filipino citizens - US$1,5002. 50 yrs. Old & above for Ambassadors/Retired Diplomats who served in the Phils. - US$1,500

NOTE: Additional Visa deposit - US$15,000.00 per dependent in excess of two (2) except for Former Filipinos.

Application Fees 1. US$1,400.00 for the Principal ; 2.. US$300.00 for each Spouse/Dependent NOTE: One-time payment only.

Monetary Obligations

1. US$360.00 Annual PRA Fee (APF) for Principal, Spouse, and (1) Child upon enrollment and every year thereafter.2. US$100.00 for each dependent in excess of two (2)

1. US$360.00 Annual PRA Fee (APF) upon enrollment and every year thereafter.

NOTE: To cover one (1) dependent only.

1. US$10.00 Annual PRA Fee (APF).

Convertibility of Deposit

LOCKED-IN in the bank

MAY BE CONVERTIBLE LOCKED-IN in the bank MAY BE CONVERTIBLE




Incentives


WITH Incentives

FOREIGN INVESTMENTS ACT NEGATIVE LIST

"Annex A"






Headquarters (ROHQ)

Retail Trade Law


Visa


Visa

Special Visa for


Foreign Investments


List


Special Visa for Employment Generation (SVEG)

a. The foreigner shall actually, directly or exclusively engage in a viable and sustainable commercial investment/enterprise in the Philippines, exercises/performs management acts or has the authority to hire, promote and dismiss employees; b. He evinces a genuine intention to indefinitely remain in the Philippines; c. He is not a risk to national security; d. The foreigner’s commercial investment/enterprise must provide actual employment to at least ten (10) Filipinos in accordance with Philippine labor laws and other applicable special laws.- The privileges under SVEG may extend to the qualified foreigner’s spouse and dependent unmarried child/children below eighteen (18) years of age whether legitimate, illegitimate or adopted. Processing Time. Substantive Proof Needed. Control Number for Each Application. Preventing Intercalations. Non-Application of Technical Rules of Evidence and Procedure. – The Commissioner of Immigration shall, upon payment of an application fee, together with payment of legal research fee, BI clearance and Express lane fee, receive and resolve completely-accomplished SVEG applications.

- Approved by Bureau of Immigration (BI) (www.immigration.gov.ph)- Issuance of Special Visa for Employment Generation

BUREAU OF IMMIGRATION (BI)

THANK YOU

SVEG (continuation)

Section 2. To Whom Issued – (A) Subject to restrictions imposed by the Constitution and existing laws on control, nationality and/or ownership of working capital, a SVEG shall be issued to a foreigner or foreigners with interests in an entity, firm, partnership or corporation that establishes, expands or rehabilitates a business activity, investment, enterprise or industry for every ten (10) full-time/regular Filipino workers who are actually employed by such entity, firm, partnership or corporation on a long-term basis in the Philippines.

(B) Foreigners exercising managerial functions in an entity, firm, partnership or corporation, that has the power to hire, dismiss and promote employees provided that they are nominated and their applications for SVEG are endorsed by such entity, firm, partnership or corporation subject to the employment requirement in paragraph (A) hereof.

Section 3. Viable and Sustainable Commercial Investment/Enterprise – Viable and sustainable commercial investment, enterprise or industry shall mean any business activity, investment, enterprise or industry in the Philippines that a SVEG under these rules shall be issued to any foreigner or group of foreigners in any business activity, investment, enterprise or industry in accordance with the laws, rules and regulations of the Philippines that:

(a) Engages in the manufacturing, processing, assembly, production, packaging, supply, delivery and/or trading of goods, products and/or commodities, either for mass consumption or for export including foreign investors in special economic zones owned and/or administered by the Philippine Economic Zone Authority (PEZA);

(b) Requires or utilizes, on a wide-market proportion, service-intensive support in information technology, systems research and development, education, knowledge and business process out-sourcing, production/services/innovation off-shoring and call and/or transaction processing;

(c) Provides, on a marketable and profitable degree, service-oriented support in modern, alternative, indigenous, physical, therapeutic, recuperative and health-care facilities; or

(d) Provides training for long-term and full-time/regular employment of Filipino workers in a business activity, investment, enterprise or industry covered by Section 2 of these Rules.

SVEG (continuation)

Section 4. Nature of Employment of Filipino Workers. – Under these Rules, the employment of at least ten (10) long-term and full-time/regular Filipino workers shall be for managerial, executive, professional, technical, skilled or unskilled positions in a business activity, investment, enterprise or industry in the Philippines.Section 5. Definition of Managerial Position. - A position is managerial if these characteristics concur: (a) The worker manages the organization or a department of the organization; (b) The worker supervises and controls the work of other supervisory, professional or managerial employees, or manages an essential function of the organization; (c) The worker has the authority to hire and/or fire those persons supervised, of if none are supervised, works at a senior level within the organization; and (d) The worker has the authority to make decisions concerning the day-to-day operations of the portion of the organization over which he or she has authority.Section 6. Definition of Executive Position. - A position is executive if these characteristics concur: (a) The worker directs the management of the organization or a major part of the organization; (b) The worker sets the goals and policies of the organization or a part of the organization; (c) The worker has extensive decision-making authority; and(d) The worker receives only general supervision or direction from higher level executives, a board of directors, or the stockholders of the organization.Section 7. Definitions of Professional, Technical, Skilled and Unskilled. – The term professionals shall refer to employment requiring formalized, extensive training or education in creative and intellectually challenging work that includes, but are not necessarily limited to, researchers, computer data and systems technicians/designers/programmers/analysts, physical/occupational therapists, nurses, medico-health specialists, medical technologists, radiologists and electronic/graphic/digital media specialists.The term technical shall refer to employment that requires highly-specialized scientific, agro-industrial, chemical, mechanical, electric, electronic and similar expertise.The term skilled shall refer to employment that requires at least two years training or experience. The term unskilled shall refer to employment that requires less than two years training or experience. However, this term excludes housekeepers and household workers, including domestics, nannies, cooks, guards, caretakers and the like.

Section 12. Processing Time. Substantive Proof Needed. Control Number for Each Application. Preventing Intercalations. Non-Application of Technical Rules of Evidence and Procedure. – The Commissioner of Immigration shall, upon payment of an application fee of P2,000.00, together with payment of legal research fee, BI clearance and Express lane fee, receive and resolve completely-accomplished SVEG applications within fifteen (15) working days from the date of filing.

(2) amo031413-rp laws foreign investments.ppt

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