THE PHILIPPINE BOARD OF INVESTMENTS

The Philippine Board of Investments (BOI), an attached agency of Department of Trade

and Industry (DTI), is the lead government agency responsible for the promotion of
investments in the Philippines.
Taking the lead in the promotion of investments, BOI assists Filipino and foreign
investors to venture and prosper in desirable areas of economic activities. Investors are
welcome to experience the potentials of the booming Philippine Industry sectors.
Profitable business opportunities abound in the food processing, construction, metal
products, telecommunications, power and infrastructure projects among others.
The Board of Investments (BOI), as the national investment promotion agency of
the government, reflects the countrys keen interest in keeping its doors open to
investors both foreign and domestic.
BOIs efforts are based on the governments set goals of encouraging more
economic activities that will take the country to a higher level of global
competitiveness, and opening more opportunities that will generate more
gainful employment for the people.
The BOI also seeks to attract quality investments that will encourage
technological innovations and provide support for industries to seize the
opportunities and challenges of global demands and competition.
Investment Priority Areas

Business Process Outsourcing

Electronics Industry
Renewable Energy
Shipbuilding
The
BOI
is
one
of
the
government's
primary
investment
arm.
To meet investors diverse requirements, BOI offers specialized services, which include:

Information assistance to local and foreign investor

Timely investment advice and facilitation regarding investors business
transactions
Assistance in the selection of ideal investment location Joint Venture Matching
Services for international local and foreign entrepreneurs
Investment advice and facilitation for small and medium entrepreneurs (SMEs)
Business linkages with public and private sectors
Evaluation and supervision of investment applications
Training on Investment Promotion
Seminar on Investment Networking for Local Executives

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Facilitation of Environmental Clearance Certificate and advocacy for environmentrelated projects

Investment briefings, inbound and outbound missions, seminars, and
conferences for local and foreign investors
After-sales service through the Investment Promotion Network (IPN), a system
of hotlines connecting Investment Promotion Units (IPUs) across 24 related
government agencies
Entrepreneurial assistance to overseas Filipino workers (OFWs)
Industry sectors planning and preparation of industry sector profiles

Incentives
Fiscal Incentives
o Income Tax Holiday
o Exemption from taxes and duties on imported spare parts(NOLCO)
o Exemption from wharfage dues and export tax, duty, impost and fees(GIE)
o Reduction of the Rates of Duty on Capital Equipment, Spareparts and Accessories by
Virtue of EO 528
o Tax exemption on breeding stocks and genetic materials
o Tax Credits
o Additional deductions from Taxable Income
Non-Fiscal Incentives
o Employment of Foreign Nationals
o Simplification of customs procedures
o Importation of consigned equipment
o Privilege to operate a bonded manufacturing/trading warehouse

BOI as the lead agency in charge of investments promotion in the country is tasked to
perform the following functions:
1. Develops and implements an investments promotion strategy for the
Philippines.
2. Registers and monitors qualified enterprises and administers investment
incentives to registered enterprises
It is divided into four (4) operating groups: Investments Promotion Group,
Technical/Investment Services Group, Industry Development Group and
Project
Assessment Group.
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1. INVESTMENTS PROMOTION GROUP

Leads in the formulation and implementation of an investment
promotion strategy and spearheads the synchronization of
investment promotion efforts both at the local and national levels
to provide total investor solutions.
Embarks on an aggressive advocacy campaign aimed at positioning
the Philippines as an investment destination of choice in Asia.
INTERNATIONAL MARKETING DEPARTMENT (IMD)
The IMD designs and implements a strategic marketing
program to reach international clients with huge investments
potentials. The process starts with investments leads identification
and ends with conversion of the leads into actual business projects.
DOMESTIC MARKETING DEPARTMENT
The Domestic Marketing Department (DMD) is in charge of
generating local investments. It works in tandem with the regional
offices of the Department of Trade and Industry and the Local
Government Units (LGUs) of the Department of Interior and Local
Government (DILG) to provide a synchronized, harmonized and
coordinated investment promotions program to spur investments in
the countryside.
DMD offers the following services:
Conduct of customized Capability Building Trainings (CBTs) in the
regions.
1. To assist the regions in the organization of an
Investment Promotion Center (IPC)
2. To assist the LGUs in crafting and development of their
Local Investments Incentives Code.
Conduct of BOI domestic roadshows.
1. Update the regions on the current Investment Priorities
Plan, BOI policies and initiatives
2. Provide technical assistance to the regions on how to
package and promote their projects to potential investors
Organize and participate in investments promotion events.
Act as an effective Investment Promotion Intermediary (IPI)
between investors and project proponents and make available wellevaluated and ready-to-go projects for promotion.
2. INVESTMENTS SERVICING GROUP
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Provides the crucial, expanded and upgraded services to a broad

range of investors.
Offers both frontline and after sales services that are designed to
persuade investor decisions to locate and retain their investments
in the country.

Business one stop shop action center (bossac)

Business One-Stop Shop Action Center (BOSSAC), formerly National
Economic Research Assistance Center (NERBAC), is the department of
Investments Servicing Group (ISG) dedicated in handholding
prospective foreign and local investors in setting up their business in
the Philippines.
BOSSAC is the frontline arm of the BOI that provides investments
counseling to potential clients over the phone, through e-mail and
walk-in clients and promotes the simplified business registration
procedures. In addition, the Department also facilitates pre-investment
transactions like work permits, visas, licenses etc.
It also maintains and updates laws from different Investment
Promotions Agencies (IPAs) and other investment-related information
to ensure that proponents are provided with all the options available
for their business venture. BOSSAC is closely coordinated with various
government agencies relating to investments to ensure a smooth
progression of investment goals.
Investors aftercare
The primary thrust of the Investors Aftercare Program is to
understand the investors priorities, whether it be to find a solution to
address current business concerns, or to expand into more profitable
business ventures.
The Investments Assistance and Services Department (IASD)
implements the aftercare program which delivers the most current
investment policies and programs to the investors. Instead of waiting
for the investors to seek assistance, our aftercare team reaches out to
discuss value propositions and resolve business-related concerns.
Providing the investors with a complete aftercare service is the
Investors Aftercare Services Departments major concern. Regular
company visits are conducted to discuss operational concerns. Casual
and forthright discussions of recurring issues, give way to solutions,
and thus create opportunities for business to grow.
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Investors aftercare
Objectives
Establish lasting partnership and foster effective and sustained
interaction with the investors Update the investors on the latest BOI
policies and information related to their business Facilitate the
expeditious resolution of issues/concern raised by the investors Assess
on future assistance that a firm may need.
Services
Regular visits to BOI-registered firms Practical business advice Issues
and concerns facilitation Updates on investment policies, rules and
regulations Investors participation through feedback/suggestion.
Benefits
Provides immediate and quick resolutions to issues raised by the
investors pertaining to their business concerns. Establishes valuable
business contacts, investors are linked up with proper authorities, and
facilitate the investors current business concerns.
Offers investors the practical options to re-invest, expand or diversify
their business Improves the countrys investment climate.
Investment Promotions Unit Network (IPU Net)
The IPU Net is a collaboration of 28 government agencies which
signed a MOA to act immediately and resolve the difficulties
encountered by the investors in operating their business. As the
secretariat, the BOI dispatches and monitors the concern and tracks
the progress of each case.
Investment-related complaints involving violations of
commitments/roles of the IPU Net member agencies are acted upon by
the Office of the Ombudsman (OMB). On 19 April 2013, Ombudsman
Conchita Carpio Morales issued the guidelines on handling requests for
assistance (RAS) and other forms of public assistance through
Memorandum Circular (MC) 01-2013. Said MC ensures prompt,
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courteous and adequate public service delivery and shall take effect on
01 June 2013.
Client Feedback
The Investments Assistance and Services Department put prime
importance to investors feedback and this is why a Client Feedback
Mechanism Form was instituted to measure the effectiveness and
relevance of the aftercare program. Suggestions/comments and
feedback are solicited to continuously improve the aftercare services
made available to the investors.
3. PROJECT ASSESSMENT GROUP
Provides professional and organized processing of investment
applications and monitors registered firms through the use of an
enhanced database system.
Provides services to investors from the time they apply for
registration through the infancy stage of the projects operation up
to the time that the project are fully operational.
4. MANAGEMENT SERVICES GROUP
Serves as the corporate planning unit of the agency.
Develops and rationalizes identified distressed industries.
Designs and implements the BOI Information System Strategic
Plan.
Serves as the General Counsel of the Board.
Renders financial and general administrative services including
records management.

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Relevant information that should be noted about registering with the Board
of Investments (BOI) and Philippine Economic Zone Authority (PEZA)

A.

Board of Investment (BOI)

To qualify for registration with the BOI, a company should be organized

under Philippine laws as a domestic entity. An enterprise may register its
activity if the same is listed in the current Investments Priorities Plan (IPP).
If not listed the enterprise may also be entitled to BOI incentives for as long
as the following conditions are met:

At least 50% of the production is for export (for enterprise

with more than 60% Filipino/40% foreign ownership); or

At least 70% of production is for export (for enterprise with

more than 40% of foreign ownership).
Foreign-owned firms, whose ownership exceeds 40% of the outstanding
capital stock and which proposes to engage in domestic-oriented activities,
may be entitled to incentives if the proposed activity is listed in the current
IPP and qualities under Pioneer status (refer to ensuing description).
B.
Philippine Economic Zone Authority (PEZA)
The Special Economic Zone Act of 1995 as amended, mandates the PEZA to
operate, administer, manage and develop Special Economic Zones or
Ecozones.
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.

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Permission has to be sought if the enterprise located within the zone will
export below 100% and in most cases PEZA has allowed up to 30% of
production for the domestic market.
So far, there are 225 proclaimed Special Economic Zones that are operating
in the country
The areas of investments covered by the Foreign Investments Act (FIA)
The FIA covers all investment areas except banking and other financial
institutions, which are governed and regulated by the Bangko Sentral ng Pilipinas
(BSP).
The Foreign Investment Negative List covers areas of economic activity whose
foreign ownership is limited to a maximum of forty percent (40%) of the
outstanding capital stock in the case of a corporation or capital in the case of
partnership.

Below are further descriptions on the Negative Lists A & B:

List A: refers to areas reserved to Filipinos by mandate of the Constitution
and Special Laws such as but not limited to:
a. Mass Media, except recording, practice of licensed profession, retail
trade,cooperative and small scale mining, etc. where foreign ownership
is prohibited; and
b. Advertising, ownership of land, operation and management of public
utilities, etc., where only minority foreign ownership is prohibited.
List B: refers to areas that are defense-related, those with adverse effects
on public health and morals and domestic market enterprises with paid-up
capital of less than US$200,000, provided they involved advance technology
as determined by the Department of Science and Technology (DOST) or
directly employ at least fifty (50) employees, in which case, the paid-up
capital shall be lowered to US$100,000 ONLY TO NON-Philippine nationals.

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Requirements must be complied with before an enterprise can enjoy tax

benefits
For a proposed activity of a domestically incorporated enterprise to qualify
for incentives, the firm must be registered with the appropriate investment
promotion agency/ies depending on the projects location, to wit:
A.

Location outside of Economic or Freeport Zones

Board of Investments (BOI)

Regional BOI in ARMM

B.
Located in Economic or Freeport Zones

Aurora Special Economic Zone Authority (ASEZA)

Cagayan Economic Zone Authority (CEZA)
Clark Development Corporation (CDC)
Phividec Industrial Authority (PIA)
Philippine Economic Zone Authority (PEZA)
Subic Bay Metropolitan Authority (SBMA)
Zamboanga Economic Zone Authority (ZEZA)

Incentives are made available to registered enterprises

A.
Board of Investments (BOI)
An enterprise registered with the BOI, pursuant to the 1987 Omnibus
Investments Code (Executive Order No. 226) is entitled to, among others, the
following incentives subject to certain terms and conditions:

Income Tax Holiday (ITH)

BOI-registered enterprise shall be exempt from the payment of income
tax reckoned from the scheduled start of commercial operations, as
follows:
*
New projects with a pioneer status for six (6) years;
*
New projects with a non-pioneer status for four (4) years;
*
Expansion projects for three (3) years, the exemption of
which, as a general, is limited to incremental sales revenue/volume;
*
New or expansion projects in less developed areas (LDAs)
for six (6) years, regardless of status;

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*
Modernization projects for three (3) years, the exemption of
which, as a general rule, is limited to incremental sales
revenue/volume.

Tax credit on raw materials, supplies and semi-manufactured

products (for export producers only);

Additional deduction from taxable income for labor expense

(cannot be simultaneously enjoyed with the ITH incentive);

Additional deduction from taxable income for necessary and major

infrastructure works (cannot be simultaneously enjoyed with the ITH

incentive);

fees.

Exemption from wharfage dues and export tax, duty, import and

Modified Duty Rate for Capital Equipment by virtue of E.O. No. 528
Since June 17, 2006, BOI registered enterprises of good standing with
project registered as new or expanding under the Omnibus Investments
Code of 1987 may import machinery, equipment, spare parts and
accessories that are subject to zero percent (0%) duty for export-oriented
enterprises and one (1%) duty for domestic-oriented enterprises. The
products fall under Chapters 40, 59, 68, 69, 70, 73,76, 82, 83, 84, 85, 87,
89, 90, 91 and 96 of the Tariff and Custom Code of the Philippines.
The capital equipment incentive provided under E.O. No. 313 (Modifying the
Nomenclature and the Rates of Imported Duty on Certain Imported Articles
under Section 104 of the Tariff and Customs Code of 1978, as amended) shall
be availed of by a registered enterprise for a period of five (5) years from its
effectivity, or until June 16, 2011.
Certain non-fiscal incentives are also available to the registered enterprise,
among which are: (a) employment of foreign nationals; (b) guaranteed
repatriation of foreign investments and earnings thereon; and (c) importation of
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consigned equipment for an unlimited period subject to the posting of re-export

bond.
B.
Philippine Economic Zone Authority (PEZA)
PEZA offers the following Investment Incentives for Ecozone
Developers/Operators:

*
*

Income Tax Holiday

4 years for IT Parks/ Buildings located outside of Metro Manila;
6 years for manufacturing located in less developed area;
Provision of vital off-site infrastructure facilities;

Option to pay a special 5% tax on Gross Income earned, in lieu of

all national and local taxes;

Permanent resident status for foreign investors and immediate

family members;

Employment of foreign nationals;

Assistance in the promotion of economic zones to local and foreign

locator enterprises;
For Ecozone and IT Locators, the following incentives could be extended:

Income Tax Holiday (ITH)

*
New registered pioneer firms
Six (6) years from commercial operation;
*
*
*

New registered non-pioneer firms

Four (4) years from commercial operation;
Expanding Firms
Three (3) years from commercial operation of the expansion;
After the ITH period, the option to pay a special 5% tax on Gross

Income, in lieu of all national and local taxes;

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Exemption from duties and taxes on imported capital equipment,
spare parts, supplies, raw materials;

Tax Credit on Domestic Breeding Stock and Genetic Materials an

ecozone export enterprise which purchases breeding stocks and genetic
materials form a domestic producer shall be entitled to a tax credit
evaluation to 100% of the value of national internal revenue taxes and
customs duties that would have been waived on the breeding stocks and
genetic materials had these items been imported;

Domestic sales allowance equivalent to 30% of total sales;

Exemption from wharfage dues and export taxes, imposts and fees;

Employment of foreign nationals;

Simplified import and export procedures;

Other incentives under Executive Order No. 226 (Omnibus

Investment Code of 1987), as may be determined by the PEZA Board.
Enterprises allowed to operate within the Subic Bay Freeport (SBF) shall, in lieu of
paying all other taxes, pay a final tax of 5% of gross income provided their income form
local (non-export) sales shall not exceed 30% of their income from all sources.
Enterprises locating within the Clark Special Economic Zone (former American Airbase
at Clark Field) and Poro Point Special Economic and Freeport Zone (formerly Wallace Air
Station and its adjoining areas) are granted incentives similar to those given to the SBF
enterprises.
Five other special economic zones are were created under separate special laws. These
are the Cagayan Special Economic Zone Authority (CESA), Zambaonga Economic Zone
Authority (ZEZA), Authority of the Freeport Area of Bataan (AFAB), and Tourism
Infrastructure and Enterprise Zone Authority (TIEZA) and Aurora Special Economic
Zone. The incentives granted to those that will locate in these ecozones are similar to
the incentives granted to PEZA ecozone.
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The activities that an RHQ/ROHQ can engage in

A.
Regional Headquarters (RHQ)
The activities of the RHQ are limited to acting as a supervisory,
communications and coordinating center for its subsidiaries affiliates and
branches in the region.
It is neither allowed to derive any income from sources in the Philippines and
to participate in any manner in the management of any subsidiary or branch
office it might have in the Philippines nor to solicit or market goods and
services whether on behalf of its mother company or its branches, affiliates,
subsidiaries or any other company.
Incentives for RHQ

Exemption from corporate income tax;

Exemption from branch profits remittance tax;

Exemption from value-added tax;

Sale or lease of goods and property, and services to the RHQ

are zero-rated;

Exemption from all kinds of local taxes, fees or charges

imposed by a local government unit, except real property tax on land
improvements and equipment;

Tax and duty free importation of equipment and materials for

training and conferences needed and solely used for the RHQ
functions, and which are not locally available, subject to prior BOI
approval;

Importation of brand new motor vehicle but subject to payment

of taxes and duties.
B.
The Regional Operating Headquarters (ROHQ) may engage in
any of the following qualifying services:

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General administration and planning

Business planning and coordination
Sourcing/procurement of raw materials component
Corporate finance advisory services
Marketing control and sales promotion
Training and personnel management
Logistics services


Research and development services and product development

Technical support and maintenance

Dataprocessing and communications

Business development
Incentives for ROHQ

Subject to preferential income tax rate of 10% on taxable

income;

Exemption from all kinds of local taxes, fees or charges

imposed by a local government unit, except real property on land
improvements and equipment;

Tax and duty free importation of equipment and materials for

training and conferences needed and solely used for the ROHQ
functions, and which are not locally available, subject to prior Board of
Investments (BOI) approval;

Importation of brand new motor vehicle but subject to payment

of taxes and duties.
ROHQ is allowed to offer qualifying services only to its affiliates, branches or
subsidiaries as declared in its registration with the Securities and Exchange
Commission (SEC). It is not allowed to directly and indirectly solicit or market
goods and services whether on behalf of their mother company, branches,
affiliates, subsidiaries or any other company.
Incentives for Expatriates

Multiple Entry Visa:

*
Expatriates, including spouse and unmarried children below 21
years old will be issued this type of visa;
*
Non-immigrant visa will be processed within 72 hours from
submission of documents to the Bureau of Immigration;
*
Validity period of 3 years extendible for another 3 years;
*
Exemption from payment of fees except reasonable administrative
costs;
*
Exemption from securing Alien Certificate of Registration;

Withholding tax of 15% on compensation income applicable to

both alien and Filipino executives holding managerial and technical
positions;

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Tax and duty free importation of used household goods and
personal effects;

Travel tax exemption

*
Personnel and their dependents.
LAWS THAT GOVERN THE BOARD OF INVESTORS
1. Board of Investments Circular no. 2014-01
2. Executive Order 98 - "Promulgating the Ninth Regular Foreign Investment
Negative List"
3. Executive Order 226 - "Omnibus Investment Code"
4. Executive Order 70 - "Reducing the Rates of Duty on Capital Equipment, Spare
Parts, & Accessories Imported by BOI Registered New and Expanding
Enterprises"
5. Implementing Rules and Regulations of Executive Order 313
6. R.A. 7042 - "Foreign Investments Act of 1991."
7. R.A. 7918 - An Act Amending Article 39, Title III of E.O. 226.
8. R.A. 8792 - "Electronic Commerce Act of 2000"
9. Revised Rules and Regulations Implementing R.A. 8502.
10. Rules and Regulations in the availment of Income Tax Holiday
11. Administrative Order No.1 of 2009 - "The Adoption and Implementation of the
Globally Harmonized System of Classification and Labeling of Chemicals (GHS)"
12. RA 7227 - "Bases Conversion and Development Act of 1992."
13. RA 7652 - "Investors' Lease Act"
14. RA 7653 - New Central Bank Act
15. RA 7718 - An Act Amending Certain Sections of "RA 6957"
16. RA 7721 - An Act Liberalizing the Entry and Scope of Operations of Foreign
Banks in the Philippines and for other purposes.
17. RA 7844 - "Export Development Act of 1994."
18. RA 7899 - "The Condominium Act"
19. RA 7916 - "The Special Economic Zone Act of 1995."
20. RA 7925 - "Public Telecommunications Policy Act of the Philippines."
21. RA 8293 - "Intellectual Property Code of the Philippines."
22. RA 8366 - "The Investment Houses Law"
23. RA 8556 - "Financing Company Act of 1998."
24. RA 8762 - "Retail Trade Liberalization Act of 2000."
25. IRR RA 8762 - "Implementing Rules & Regulations for Retail Trade Liberalization
Act of 2000."
26. RA 8791 - "The General Banking Law of 2000."
27. RA 8799 - "The Securities Regulation Code."
28. RA 8800 - "Safeguard Measures Act."

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29. RA 9135 - "The Tariff and Customs Code of the Philippines, as Amended, and
for other purposes"
30. RA 9136 - "Electric Power Industry Reforms Act of 2001."
31. RA 9161 - "Rental Reform Act of 2002."
32. RA 9178 - Barangay Micro Business Enterprises (BMBEs) Act of 2002.
33. RA 9182 - "The Special Purpose Vehicle (SPV) Act of 2002."
34. RA 9184 - "Government Procurement Reform Act."
35. RA 9194 - An Act Amending RA 9160
36. RA 9211 - "The Tobacco Regulation Act of 2003."
37. RA 9224 - An Act Rationalizing the Excise Tax on Automobiles, Amending for the
purpose the National Internal Revenue Code of 1997, and for other purposes.
38. RA 9239 - "Optical Media Act of 2003".
39. JOINT DTI-DENR-DA-DOF-DOH-DILG-DOLE-DOTC ADMINISTRATIVE ORDER
NO. 01 Series of 2009".

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