Business Registration

1. Who may apply for PEZA License?

Enterprises that may qualify for registration with PEZA are domestic company, subsidiary and branch office that will manufacture and export 100% of their production and/or services and are located in the Ecozones.

2. What are the industries/activities that are eligible under PEZA?

• • Export Manufacturing – manufacturing, assembly or processing activity resulting in the exportation of at least 70% of production. (“Manufacturing / Processing” shall mean the process by which raw materials or semi-finished materials are converted into a new product through a change in their physical, mechanical or electro-magnetic characteristics and/or chemical properties. “Assembly” shall mean the process by which semi-finished parts or materials are put together or combined to form a distinct product without substantially changing its physical or mechanical characteristics or electro-magnetic and/or chemical properties.)  Eligible firms shall qualify for registration as “Economic Zone Export Manufacturing Enterprise.”
  • IT (Information Technology) Service Export – IT service activities, of which 70% of total revenues is derived from clients abroad. (“IT Service Activities” are activities which involve the use of any IT software and/or system for value addition). Among the IT Service activities eligible for incentives are: IT-enabled services such as business process outsourcing, call centers, data encoding, transcribing and processing, etc.; software development and application, including programming and adaptation of system softwares and middlewares; for business, media, e-commerce, education, entertainment, etc.; content development for multi-media or internet purposes; and others. Eligible firms shall qualify for registration as “IT Enterprise.”
  • Tourism – establishment and operation within PEZA Tourism Special Economic Zones of sports and recreation centers, accommodation, convention, and cultural facilities and their special interest attraction activities / establishments, with foreign tourists as primary clientele. Eligible firms shall qualify for registration as “Tourism Economic Zone Locator Enterprise.”
  • Medical Tourism – medical health services, endorsed by the Department of Health, with foreign patients as primary clientele. Eligible firms shall qualify for registration as “Medical Tourism Enterprise” in a Medical Tourism Special Economic Zone Park or Center.
  • Agro-industrial Export Manufacturing – processing and or manufacturing of agricultural products resulting in the exportation of its production. (“Processing” shall mean the conversion of any agricultural and marine products from its raw state into intermediate or final product which undergo physical and/or chemical change through mechanical and/or chemical process.) Eligible firms shall qualify for registration as “Agro-Industrial Economic Zone Export Enterprise.”
  • Agro-industrial Bio-Fuel Manufacturing – specialized manufacturing of agricultural crops and eventual commercial processing which shall result in the production of clean energy such as bio-fuels and the like. Eligible firms shall qualify for registration as “Agro-Industrial Economic Zone Enterprise.”
  • Logistics and Warehousing Services – (a) operation of a warehouse facility for the storage, deposit, safekeeping of goods for PEZA-registered Economic Zone Export Manufacturing Enterprises, and or (b) importation or local sourcing of raw materials, semi-finished goods for resale to – or for packing / covering (including marking / labeling) cutting or altering to customers’ specification, mounting and/ or packaging into kits or marketable lots for subsequent sale to – PEZA-registered Export Manufacturing Enterprises for use in their export manufacturing activities, or for direct export, or for consignment to PEZA-registered Export Manufacturing Enterprises and eventual export.  Eligible firms shall qualify for registration as “Economic Zone Logistics Services Enterprise.”

• • Economic Zone Development and Operation :

1. 1. 1. Manufacturing Economic Zone Development / Operation – development, operation and maintenance of an economic zone for export manufacturing enterprises, inclusive of the required infrastructure, facilities and utilities such as light and power system, water supply and distribution system, sewerage and drainage system, pollution control devices, communication facilities, paved road network, administration building. Eligible firms shall qualify for registration as
      2. IT Park Development / Operation – development, operation and maintenance of an area as a complex capable of providing infrastructures and other support facilities required by IT Enterprises, as well as amenities required by professionals and workers involved in IT Enterprise, or easy access to such amenities.  Eligible firms shall qualify for registration as “IT Park Developer / Operator.”
      3. Tourism Economic Zone Development / Operation – development, operation and maintenance of an integrated resort complex, with prescribed carrying capacities of tourist facilities and activities, such as but not limited to, sports and recreation centers, accommodations, convention and cultural facilities, food and beverage outlets, commercial establishments and other special interest and attraction activities / establishments, and provided with roads, water supply facilities, power distribution facilities, drainage and sewage systems and other necessary infrastructure and public utilities.  Eligible firms shall qualify for registration as “Tourism Economic Zone Developer / Operator.”
         “Manufacturing Economic Zone Developer / Operator.”
      4. Medical Tourism Economic Zone Development / Operation – development, operation and maintenance of a Medical Tourism Park or Medical Tourism Center which are planned and designed in accordance with the standards of the Department of Health and the Department of Tourism to have support facilities and services required for health and wellness, and provided with required infrastructure facilities and utilities. Eligible firms shall qualify for registration as “Medical Tourism Economic Zone Developer / Operator.”
      5. Agro-Industrial Economic Zone Development / Operation – development operation and maintenance of an agro-industrial economic zone planned and designed to have support facilities and services required for processing and agro-based manufacturing facilities, and provided with the required infrastructure facilities and utilities.  Eligible firms shall qualify for registration as “Agro-Industrial Economic Zone Developer / Operator.”
      6. Retirement Economic Zone Development /Operation – development. operation and maintenance of a Retirement Economic Zone Park or Center, planned and designed in accordance with the accreditation standards of the Philippine Retirement Authority, and provided with the required infrastructure facilities and utilities.  Eligible firms shall qualify for registration as “Retirement Economic Zone Developer / Operator.”

• • Facilities Providers:

                         a. Facilities for Manufacturing Enterprises – construction as owner /operator of factory buildings inside a PEZA                                   Special Economic Zone for lease to PEZA-registered Export Manufacturing Enterprises. Eligible firms shall qualify for                                   registration as “Economic Zone Facilities Enterprise.”

                         b. Facilities for IT Enterprises – construction as owner/operator of buildings and other facilities inside IT Parks which                           are leased to PEZA-registered IT Enterprises. Eligible firms shall qualify for registration as “IT Park Facilities Enterprise.”

                        c. Retirement Facilities – establishment, operation and management of retirement facilities and other related activities,                          with foreign retirees as primary clientele, duly endorsed by the Philippine Retirement Authority, and located in a                                            Retirement Economic Zone. Eligible firms shall qualify for registration as ” Retirement Zone Facilities Enterprise.”

• • Utilities – establishment, operation and maintenance of light and power systems, water supply and distribution systems inside Special Economic Zones.  Eligible firms shall qualify for registration as “Economic Zone Utilities Enterprise.”

1. Can the Authorized Managing Officer (AMO) be a foreigner?

            – Yes.

2. What is the qualification of AMO?

            – He/She must have at least 2 years of experience in construction business and not necessarily an engineer of the company.

           – He/She must be appointed by the Corporation through Board Resolution defining his/her scope of limitations and powers as AMO.

           – He/She must attended the AMO Seminar and pass the written examination.

           – He/She must attended and completed 40-hour COSH Seminar.

3. Can the AMO become the Sustaining Technical Employee (STE) of the Company?

          – Yes, provided that he/she meets the qualification of a STE.

4. How many STE/s are required?

          – The number of STE/s depends on the category and classification of the applicant (see PCAB Classification-Categorization Table).

5. What is the qualification of STE/s?

         – He/She must meet the required construction experience.

         – He/She must have PRC License.

         – At least one of the STE/s must have completed the 40-hour COSH Seminar.

6. Can the STE be a foreigner?

         – Yes, provided that he/she must have Special PRC Permit, Alien Certificate of Registration and current working visa.

7. For the proof of financial qualification, what is the most important requirement?

         – For new corporation, it must qualify with the required minimum networth/equity based on the classification & category. It must provide Interim Financial Statement with presentation of original Bank certificate bearing the amount of cash on bank. Also, it must reflect that the paid-up capital is actually deposited minus the expenses of the corporation.

8. Important reminders for easy registration:

         – Must follow the instructions on how to document the application and required attachments.

        -For STE Construction Experience, they must surpass the minimum experience for additional credit points to meet the required “Overall Credit Points”

       -For Networth/Equity, before incorporation, make sure that they have an additional 10%-20% paid-up capital based on the category & classification they wanted to apply in PCAB to cover the incorporation expenses and to have the remaining equity counted for additional credit points to meet the required “Overall Credit Points”

8. Important reminders for easy registration:

          -Make sure that the nominated STE/s should declare their actual construction experience based on the Classification & Category the applicant will apply. (i.e. STE must have General Building experience, if the corporation will apply General Building Classification)

         -Applicant must already have SSS, Philhealth, and Pag-ibig with proof of payment for their monthly contribution.

         -Applicant must have an active contact number and company email for the email notification/updates from PCAB.

1. Are Resident Alien Representative (RAR) and Authorized Managing Officer (AMO) different from each other?

            – RAR and AMO must be one and the same. AMO is usually referred if he/she is a Filipino. RAR is usually referred if he/she is a foreigner.

2. What is the qualification of RAR/AMO?

           – He/She must have at least 2 years of experience in construction business and not necessarily an engineer of the company.

          – He/She must be appointed by the Corporation through Board Resolution defining his/her scope of limitations and powers as RAR/AMO.

         – He/She must attend the AMO Seminar and pass the written examination.

          – He/She must attended and completed 40-hour COSH Seminar.

3. Do we still need a Filipino Resident Agent if we already have RAR?

         – Yes, Filipino Resident Agent is different from RAR/AMO. It is a must to have a Filipino Resident Agent as the legal representative of the Corporation.

4. In case of projects to be undertaken, what if it is “privately owned projects” which is not covered with Bilateral Agreement or Expanded BOT Law, are we still qualified?

         – It would depend on the presentation of the “Invitation to Bid”. If privately owned projects, they need to justify any exemptions from laws and that the foreign investor have preferred contractor for their projects.

5. For Back-to-back Guarantee from the parent company, can it be Board Resolution?

         – Yes. Also, it must be Authenticated or in Red Ribbon.

6. For the track record of the corporation, do we need to present the projects undertaken by the mother/parent company?

           – Yes. Size range depends on the govt. projects requirement or project owner.

7. Can the STE be a foreigner?

         – Yes, provided that he/she must have Special PRC Permit, Alien Certificate of Registration and current working visa

1. Who may engage in the business of lending activities?

The Lending Company Regulation Act (R.A. No. 9474) mandates that the business of lending activities can only be engaged/entered into by a stock corporation duly registered and licensed by the Securities and Exchange Commission (“SEC” or “Commission”);

2. What is the process of incorporation/registration of lending companies?

• Compliance with the requirements in forming an ordinary stock corporation, such as reservation of corporate name, filing of incorporation documents, submission of downloadable forms and payment of corresponding fees.
• A minimum paid-up capital of P1,000,000.00.
• Obtaining a Certificate of Authority to engage in lending business activities, as issued by the SEC, after compliance with the requirements in forming an ordinary stock corporation.

3. What is the rate of interest that should be imposed by a lending company?

Section 7 of R.A. No. 9474 on ‘Amounts and Charges on Loans’ states that “a lending company may grant loans in such amounts and reasonable interest rates and charges as may be agreed upon between the lending company and the debtor: Provided, That the agreement shall be in compliance with the provisions of R.A. No. 3765, otherwise known as the “Truth in Lending Act” and R.A. No. 7394, otherwise known as the “Consumer Act of the Philippines”; Provided, further, That the Monetary Board, in consultation with the SEC and the industry, may prescribe such interest rates as may be warranted by prevailing economic and social conditions.

Before transacting with a lender, the individual should check the rates provided by the SEC in order for him/her to compare the available rates being charged.

1. What is the CPRS?

– The Client Profile Registration System (CPRS) is one of the Internet-enabled applications being developed under the e2m-Customs Project that facilitates an automated process of accreditation or registration including renewal and/or amendments of all BOC stakeholders by appropriate accrediting offices. Various transactions with the Bureau cannot be processed unless the client is duly registered with the CPRS.

The e2m-Customs systems that will be relying on the CPRS database in validating every client transaction are the Electronic Manifest System, Informal Entry System, Automated Bonds Management System, Automated Export Documentation System, Warehousing Entry System, Transshipment System, Online Release System, Licensing and Clearance System, Hold and Alert System and the Selectivity System.

2. What is the process for registering with the CPRS?

– There are different approval BOC offices and Other Government Agencies who are in charge of accrediting/registering various types of BOC stakeholders. At the end of every accreditation process, the concerned/approving office will notify the client via email on the status of the application.

Broker

• Broker lodges his/her CPRS profile via the VASP;
• CAS receives the submitted accreditation application including required documents;
• CAS performs approval of the submitted profile;
• System will generate an email with attached Certificate of Registration indicating the assigned unique Customs Client Number (CCN) for the broker as a proof of accreditation

3. Who must register first, importers or brokers?

– Brokers must register first and will be issued their Certificates of Registration which includes the Customs Clients Number (CCN) as proof of accreditation. The broker’s CCN is a mandatory requirement for the importer to register his own CPRS profile.

4. When can an importer/broker start transacting with the BOC?

– An importer/broker may start lodging import entries only after he/she has obtained the following:

• Certificate of Registration with Customs Client Number (CCN) and;
• Bank Reference Number from the nominated Authorized Agent Bank (AAB).

An AAB may only issue a Bank Reference Number to an importer only after the latter has presented the Certificate of Registration with Customs Client Number (CCN)

5. Authorized Agent Bank (AAB)

– Authorized Agent Banks lodges CPRS profile through the internet site www.customs.gov.ph using the Login name and password provided by the Bankers Association of the Philippines (BAP).

The BAP performs accreditation of CPRS submitted;

BOC MISTG performs approval of the CPRS profile submitted and an email with attached  Certificate of Registration indicating the assigned unique Customs Client Number (CCN) will be sent to the email account provided;

BOC MISTG performs activation of the CPRS profile submitted;

6. WHAT ARE REGULATED IMPORTATIONS/EXPORTATIONS?

Regulated Imports/Exports are goods which are subject to (import/export) regulations by concerned government regulatory agencies such as the Food and Drug Administration (FDA), Bureau of Philippine Standards (BPS), Bureau of Plant Industry (BPI), Bureau of Animal Industry (BAI), etc.

Regulated goods may be imported or exported only after securing (from the concerned government regulatory agency) the necessary permit/s, clearance/s, license/s, or any other requirements, prior to importation or exportation, as the case may be.

Regulated Imports/Exports include, but are not limited to, the following:

Food products (processed or unprocessed), plant products, animal products, aquatic products, drugs and chemical products, used motor vehicles, electrical appliances, telecommunication equipment, tobacco products, mineral products, etc.

7. WHAT ARE RESTRICTED IMPORTATIONS/EXPORTATIONS?

Restricted Imports/Exports are goods which may be imported or exported ONLY when authorized by law or regulation. As provided under the CMTA, the following are restricted imports/exports:

1. Dynamite, gunpowder, ammunitions and other explosives, firearms and weapons of war, or parts thereof;
2. Roulette wheels, gambling outfits, loaded dice, marked cards, machines, apparatus or mechanical devices used in gambling or the distribution of money, cigars, cigarettes or other goods when such distribution is dependent on chance, including jackpot and pinball machines or similar contrivances, or parts thereof;
3. Lottery and sweepstakes tickets, except advertisements thereof and lists of drawings therein;
4. Marijuana, opium, poppies, coca leaves, heroin or other narcotics or synthetic drugs which are or may hereafter be declared habit forming by the President of the Philippines, or any compound, manufactured salt, derivative, or preparation thereof, except when imported by the government of the Philippines or any person duly authorized by the Dangerous Drugs Board, for medicinal purposes;
5. Opium pipes or parts thereof, of whatever material; and
6. Any other goods whose importation and exportation are restricted.

The restriction to import or export the above stated goods shall include the restriction on their transit.

8. WHAT ABOUT PROHIBITED IMPORTATIONS/EXPORTATIONS?

Prohibited Imports/Exports are goods which are, by their nature, unlawful to be imported or exported. These goods are otherwise called as “contrabands”. As provided under the CMTA, the following are prohibited imports/exports:

1. Written or printed goods in any form containing any matter advocating or inciting treason, rebellion, insurrection, sedition against the government of the Philippines, or forcible resistance to any law of the Philippines, or written or printed goods containing any threat to take the life of, or inflict bodily harm upon any person in the Philippines;
2. Goods, instruments, drugs and substances designed, intended or adapted for producing unlawful abortion, or any printed matter which advertises, describes or gives direct or indirect information where, how or by whom unlawful abortion is committed;
3. Written or printed goods, negatives or cinematographic films, photographs, engravings, lithographs, objects, paintings, drawings or other representation of an obscene or immoral character;
4. Any goods manufactured in whole or in part of gold, silver or other precious metals or alloys and the stamp, brand or mark does not indicate the actual fineness of quality of the metals or alloys;
5. Any adulterated or misbranded food or goods for human consumption or any adulterated or misbranded drug in violation of relevant laws and regulations;
6. Infringing goods as defined under the Intellectual Property Code and related laws; and
7. All other goods or parts thereof, which importation and exportation are explicitly prohibited by law or rules and regulations issued by the competent authority.

1. How does our proposed project qualify for registration with the BOI?

To qualify for registration with the BOI for incentive purposes, the proposed foreign investment must be made in any of the following:

1. Preferred areas of investment listed in the current Investment Priorities Plan (IPP). A preferred area may be declared pioneer if it:

             i.Engages in the manufacture, processing, or production (not merely in the assembly or packaging) of goods, products,

             ii.commodities, or raw materials that have not been or are not being produced in the Philippines on a commercial scale;

            iii. Uses a design, formula, scheme, method, process, or system of production or transformation of any element, substance, or raw materials into another raw material or finished good which is new and untried in the Philippines;

            iv.Engages in the pursuit of agricultural, forestry, and mining activities and/or services including the industrial aspects of food processing whenever appropriate, pre-determined by the concerned IPA to be feasible and highly essential to the attainment of the national goal in relation to a declared specific national food and agricultural program for self sufficiency and other social benefits of the project; or

          v. Produces non-conventional fuels or manufactures equipment which utilize non-conventional sources of energy or uses or converts to coal or other non-conventional fuels of sources of energy in its production, manufacturing, or processing operations.

Pioneer status under any of the foregoing instances shall be subject to the condition that the final product involves or will involve substantial use and processing of domestic raw materials, whenever available; taking into account the risks and raw magnitude of investment.

           2. Enterprises engaged in preferred non-pioneer areas and exporting at least 70% of their output.

           3. Projects in less-developed areas provided that the activities in all of the above cases are not reserved for Philippine nationals under the Foreign Investment Negative List (FINL).

2. What is a Pioneer Status?

A preferred area of investments may be declared Pioneer if the activity:

• Involves the manufacturing or processing (not merely assembly or packaging of goods or raw materials that have not been produced in the Philippines on a commercial scale; or
• Uses a design, formula, scheme, method, process or system of production or transformation of any element or raw material or finished good which is new and untried; or
• Engages in agricultural activities/services essential to the achievement of the country’s self-sufficiency program; or
• Produces non-conventional fuels or manufactures equipment which utilize non conventional sources of energy; or
• Conforms to other specific criteria as provided for in the annually drawn investments Priorities Plan.

3. What possible obstacles would our application meet?

The obstacles normally encountered in the filing of applications include:

• non-compliance with the criteria set by the BOI,
• misinterpretation of the coverage of activities listed in the IPP,
• failure to submit the required project feasibility study and other supporting documents, and
• possible opposition from sectors or enterprises which might be adversely affected by the proposed project.

The BOI requires publication of the notice of application conducts hearings if objections to the application are received.

4. How long will it take to obtain BOI approval once all requirements are complied with?

Under EO 226, applications filed with the BOI shall be considered automatically approved if not acted upon by the BOI Board within 20 working days after they have been officially accepted, subject to the usual terms and conditions.

5. Assuming approval is obtained, what restrictions are ordinarily attached?

A list of general and specific terms and conditions is normally attached to the approval letter issued by the BOI upon approval of the application for registration. The general conditions include certain management, financial, operational, and marketing restrictions which must be properly complied with so as to avoid grounds for cancellation of registration. The specific terms and conditions which may include nationality, operational, and reporting requirements vary depending upon the nature of the business enterprise.

6. How much time is an investor allowed to start his project?

The amount of time allowed for starting a registered project depends on the type of the proposed project and the period set by the proponent in the feasibility study with the approval of the BOI. Generally, the project must be commenced within one year from approval date, but may be extended under applicable qualifying circumstances.