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Ord. No. 016-2011

Guinobatan Investment Incentive Code of 2011 (GIIC of 2011)

Republic of the Philippines

Province of Albay
Municipality of Guinobatan
OFFICE OF THE SANGGUNIANG BAYAN
Tel. No. (052)484-8257; E-mail: sbguinobatan@yahoo.com

EXCERPTS FROM THE MINUTES OF THE 43RD REGULAR SESSION OF

THE SANGGUNIANG BAYAN HELD ON NOVEMBER 8, 2011 AT 9:41 IN
THE MORNING AT THE SANGGUNIANG BAYAN SESSION HALL,
GUINOBATAN, ALBAY.
Present:
Officer

Absent:

Hon. Wilfredo O. Arevalo, Sr.

Hon.
Hon.
Hon.
Hon.
Hon.
Hon.
Hon.
Hon.

Councilor
Councilor
Councilor
Councilor
Councilor
Councilor
Councilor (ABC Pres.)
Councilor (SKF Pres.)

Juris L. Villareal
Rolando P. Palabrica
Reynaldo O. Namia
Maria Sofia O. Orpiada Stephen O. Ocfemia
Robert M. Baaga
Paul N. Garcia
Patrick Polly C. Pintor -

Hon. Julio S. Tingzon IV

Hon. Carlomagno P. Flores

Vice Mayor & Presiding

Councilor (O.B.)
Councilor

MUNICIPAL ORDINANCE NO. 016-2011

ENACTING THE GUINOBATAN INVESTMENT INCENTIVE CODE OF
2011 AND FOR OTHER PURPOSES.
Proponents/Sponsors:

All SB Members Present

Be it ordained by the Sangguniang Bayan of Guinobatan, Albay,

in session assembled, that:
CHAPTER I
TITLE, DECLARATION OF POLICY AND PURPOSE
AN ORDINANCE ENACTING
Section 1. TITLE. This Ordinance shall be known and cited as the
GUINOBATAN INVESTMENT INCENTIVE CODE OF 2011
or simply GIIC.
Section 2. DECLARATION OF POLICY. It is hereby declared to be the
policy of Guinobatan to encourage or attract investor, both local
and foreign, whether new investment, expansion and/or
diversification in industries which will provide employment
opportunities, uplift the standard of living of the people of
Guinobatan in particular, and the surrounding areas in general,
and provide equitable distribution of wealth and resources,
while providing the investors the necessary incentive therefor.
Section 3. PURPOSE, INTENT, AND OBJECTIVE. It is the purpose,
intent and objective of this code:
a. To lay the legal framework and mechanism for integrating
the investment incentives provided under existing national
laws, treaties, and international agreement with that of the
local development investments incentive.

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b. To spread the development of Guinobatan from its developed

to underdeveloped areas.
c. To promote the flow of investor, both foreign and local, into
the town which would provide employment opportunities
and uplift the standard of living of the people, and establish
enterprises that would utilize substantial amount of local
labor, raw materials and natural resources of the Town and
the Province.
d. To attract or encourage investors as partners of the Town in
development that will ensure and support, among other
things, the preservation and enrichment of our culture, the
promotion of health and safety, encourage and support the
development of appropriate and self-reliant scientific and
technological capabilities, the improvement of public morals,
the enhancement of economic prosperity of the environment
and human and ecological security, and the preservation of
the comfort and convenience of its inhabitants.
e. To transform selected areas of the Town into highly
developed agro-industrial, commercial, investment, financial
and eco-tourism center of the province and that of the
region.
f. To minimize, if not completely eradicate the disincentives to
investment such as bureaucratic red tape, inadequate
domestic and potable water supply, unreliable and high cost
of electricity, and the high cost of transportation.
g. To provide or ensure balanced development in the Town as
to promote the general welfare of its people. And,
h. To include among the Preferred Area of Investment any
existing or contemplated Economic Enterprises of the
Municipal Government if approved by the Sangguniang
Bayan for privatization.
CHAPTER II
DEFINITION OF TERMS
Section 4. DEFINITION OF TERMS. For purpose of this Code, the
following words and phrases shall mean as herein defined
unless their context provide otherwise, to wit:
a. BONAFIDE RESIDENT refers to a person who is at least
eighteen (18) years old and above, and registered voter of
any barangay in the municipality.
b. BOARD refers to the Guinobatan Investment and
Promotion Board.
c. BOI refers to the Board of Investment.
d. CAPITALIZATION refers to total project cost.
e. CDA refers to the Cooperative Development Authority.
f. TOWN refers to the Municipality of Guinobatan.
g. CODE refers to the Guinobatan Investment Incentive Code
of 2011.
h. DIVERSIFYING ENTERPRISES refers to those enterprises
that are investing in other products or services.
i. DOLE refers to the Department of Labor and Employment.
j. DTI refers to the Department of Trade and Industry.
k. EXISTING ENTERPRISES refers to those enterprises
whose places of operation or production are located within
the Municipality.
l. EXPANDING ENTERPRISES refers to existing enterprises
that had been already in the business and planning to
expand by increasing either their size, quantity or scope of
operation.

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m. FIX CAPITAL INVESTMENT refers to investment in site

development,
structures,
building,
machines
and
equipments for use in the operation of the business.
n. FOREIGN INVESTMENTS refers to equity investment
owned by a non-Philippine National.
o. GOVERNMENT LAND refers to the land owned by the
government.
p. GRANTEE refers to the recipient of the incentives and
privileges under this Code.
q. INVESTMENT refers to something in which money is
invested or expended for future benefits.
r. INVESTOR refers to one who commits economic resources
to a commercial venture for purposes of gain or profit.
s. INVESTMENT PROMOTION refers to promoting the town
as investment destination in the form of information,
services and network linkage with other government
agencies and the private sector.
t. LOCAL LABOR/WORKERS refers to those workers or
personnel who are residents of the town for at least six (6)
months, as evidenced by a Barangay Clearance issued by the
Punong Barangay, or his authorized representative.
u. NEW ENTERPRISES/INVESTMENT refers to new
investments which are within the Preferred Areas of
Investment of existing enterprises with plans for
expansion/diversification to other business ventures.
v. NATIONAL LAWS refers to the Omnibus Investment Code
of 1997, RA 7718, RA 7884 and RA 7916.
w. NON-PIONEERING ENTERPRISES refers to those
enterprises that intend to venture into new projects within
the town but can be found in less developed areas and the
nature of their business do not meet the pioneering
enterprises criteria.
x. PIONEERING ENTERPRISES refers to establishment,
regardless of the nature of the project, pioneering in the
town and whose products have not been or not being
produced in the municipality on commercial scale.
y. PLANT FACILITIES refers to building, structures,
machines and equipment installed for the operation of the
business.
z. PREFERRED AREAS OF INVESTMENT refers to those
areas of investment identified by the Board, in consultation
with another sectors, to be given preference, or where
investors can pour their investment.
aa. PROJECT STUDY refers to the profile of the project which
presents the marketing, financial, technical and socioeconomic aspect of the projects.
ab.RA 7718 refers to the Build-Operate-Transfer Law or BOT
Law.
ac. RA 7844 refers to the Export Development Act of 1994.
ad.RA 7916 refers to the Special Economic Zone Act of 1995.
CHAPTER III
GUINOBATAN INVESTMENT AND
PROMOTION BOARD
Section 5. GUINOBATAN INVESTMENT AND PROMOTION BOARD
(GIBP). There is hereby created the Guinobatan Investment
and promotions Board, hereinafter referred to as the Board, to
oversee/implement the provisions of this Code.

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Section 6. COMPOSITION OF THE

composed of the following:

BOARD.

The Board shall be

a. Municipal Mayor
b. Municipal Treasurer
c. Chairman of the Appropriation Committee, Sangguniang
Bayan
d. Chairman of the Trade and Industry Committee,
Sangguniang Bayan
e. Chairman of the Environment and Natural Resources,
Sangguniang Bayan
f. Personnel Officer/PESO Manager
g. Municipal Planning & Development Coordinator
h. Designated Municipal Investment Promotion Officer
i. President, Guinobatan Business Club
j. Provincial DTI Representative
The membership of the Board may be increased or decreased
by the Sangguniang Bayan through the recommendation of the
Board, as it may deem necessary in the efficient implementation
of the provision of this Code.
The Municipal Mayor, as Chairman, shall appoint the Vice
Chairman, and the members of the Board whose terms of office
shall be co-terminus with that of the appointing authority.
Section 7. TECHNICAL COMMITTEE. There is hereby created a local
technical committee to provide technical assistance to the
Board. It shall consist of the following:
a. The Municipal Engineer
b. The Municipal Health Officer
c. The Legal Consultant/Officer
Section 8. SECRETARIAT. The Municipal Investment Action Center,
headed by the designated Municipal Investment Promotion
Officer shall act as the Secretariat of the Board. It shall be
tasked in the preparation of the Agenda, keeping complete
records of the proceedings and to send notices of the meetings
of the Board. It shall likewise keep a complete records and
register of all approved application as well as those which were
suspended and/or cancelled.
Section 9. MEETING AND QUORUM OF THE BOARD. The Board shall
meet at least once every quarter or as often as may be
necessary at the call of the Chairman or on such date and time
as it may be fixed and in such place so designated. The
presence of at least a majority of the member shall constitute a
quorum, and a majority of the quorum in a meeting held shall
be required to validly exercise its powers, duties and functions.
Section 10. POWER, DUTIES AND FUNCTIONS OF THE BOARD. The
Board shall be responsible for the promotion and regulation of
Investment, more particularly the establishment of a favorable
and stable business climate consistent with the development
thrusts and priorities of the LGU. Towards this end, the Board
shall:
a. Recommend such rules and regulations as may be necessary
to implement the intent and provision of this Code, subject
to the approval of the Sangguniang Bayan.

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b. Come up with the short and medium term promotion

program specifying investment priority area in consultation
with the public and private sector.
c. Establish a One-Stop-Documentation and Action System and
to supervise the operation and implementation of the same.
d. Approve application for and availment of incentives to
qualified investors.
e. Decide controversies concerning the implementation of the
Code.
f. Cancel or suspend the enjoyment of incentives benefits
granted to investors by the Code and/or require refund of
incentives enjoyed by such investors for violating any of the
provisions of the Code.
g. Source out additional funding from the Municipal
Government and other sources, both public and private, to
support its operation or in the pursuit of the intent and
purpose of this Code.
h. Coordinate with other agencies and/or private sector
organization for the purpose of simplifying system,
procedures and requirements in establishing new and
expanded investments and business operation in the
Municipality and support services for the Guinobatan
Investment Promotions Board.
i. Identify all possible incentives to attract or encourage
investments in the Municipality and recommend their
development, establishment and operation.
j. Determine the best way of minimizing or eliminating the
disincentives to investments mentioned in Section 3(f) of
this Code, carry out those that are within its power to
perform, and recommend to the Sangguniang Bayan.
k. Render annual reports and such special reports on the
accomplishment and activities of the Board as may be
requested by the Sangguniang Bayan jointly signed by its
Secretary and the Chairman. And,
l. Exercise such other powers, duties and functions as may be
necessary or incidental to the attainment of the intent and
purposes of this Code.
In discharging its power, duties and functions, the Board shall
take extra care that it does not thereby become a stumbling
block and a major disincentive to investment into the
Municipality. It should also keep in mind that over and above
the intention of attracting investment is the paramount
responsibility of insuring the well-being and general welfare of
its inhabitants.
Section 11. POWERS AND FUNCTIONS OF THE CHAIRMAN. The
Chairman of the Board shall have the following powers and
functions:
a. To preside over the regular and special meeting of the
Board;
b. To recommend to the Board such policies and measures he
may deem necessary to carry out the intents and purposes of
this Code;
c. To approve applications for the grant of incentives to
qualified investors in accordance with the policies set by the
Board; and,
d. To exercise such other powers and perform such duties as
may be authorized by the Board from time to time.

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Section 12. POWERS AND FUNCTIONS OF THE VICE CHAIRMAN. The

Vice Chairman of the Board shall have the following powers and
functions:
a. Preside over the regular and special meetings of the Board
in the absence of the Chairman;
b. Perform such duties as may be assigned to him by the
Chairman and the Board; and
c. Perform all the powers and functions of the Chairman during
the latters absence or temporary incapacity.
CHAPTER IV
ESTABLISHMENT OF AN INVESTMENT ACTION CENTER
Section 13. MUNICIPAL INVESTMENT ACTION CENTER (MIAC). The
Office of the Mayor shall establish a Municipal Investment
Action Center that shall assist the Board in all activities
concerning investment promotions and investment policies in
coordination with the Department of Trade and Industry. It shall
provide prospective foreign and local investors with information
as to the Municipals potential investment areas. The Center
shall be headed by the designated Municipal Investment
Promotion Officer.
Section 14. POWERS AND FUNCTIONS. The Center shall serve as the
Technical Secretariat of the Board and shall implement its
policies and guidelines specifically the following:
a. Provide all applicants with the application forms and other
necessary papers/documents for the grant of investment
incentives;
b. Accept, process and evaluate all application for registration
for the availment of investment incentives and submit its
recommendation to the Board within ten (10) working days
from receipt of the application;
c. Collate, analyze and compile pertinent data and information
and studies concerning areas that have been or may be
declared as priority/preferred areas of investment by the
Board;
d. Establish and maintain networking relations with other
offices and agencies whenever appropriate and necessary;
e. May recommend to the Board ay modification/amendments
to existing legislation and procedures on local investments;
f. Prepare the Agenda for the meetings of the Board;
g. Submit Annual Reports to the Board through the Chairman
on activities of the Board.
CHAPTER V
INCENTIVES AND SUPPORT MEASURES
Section 15. APPROPRIATE INCENTIVES AND SUPPORT MEASURES.
The Board, upon the recommendation of the Center, shall
identify and recommend for the approval of the Sangguniang
Bayan appropriate incentives and support measures to promote
preferred areas of investment which shall extend to targeted
and qualified investors.
Section 16. REMOVAL/DELETION
OF
PRIORITY/PREFERRED
INVESTMENT AREAS. The Center shall review the package of
appropriate incentives and support measures and the preferred
areas of investment or activity every two (2) years and

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recommend to the Board the removal from or inclusion of an

area or activity in the list.
Upon the recommendation of the Center, the Board may remove
an area or activity from the list of preferred areas of investment
as follows:
a. Sufficient investment in the areas have been attained;
b. The continued extension of investment or support measure
for the specific investment area is no longer to the best
interest of the Municipality; and
c. The investment area or activity cannot attract investor
within reasonable time and cost or may result in unfavorable
business climate.
CHAPTER VI
QUALIFICATIONS AND INCENTIVES
Section 17. QUALIFICATION OF A NEW ENTERPRISE. A new
enterprise which intends to avail of the incentives provided for
in this Code must meet the following qualifications:
a. Must have complied with all the requirements mandated
under existing local and national laws and the Constitution
by and through presentation of Certificate of Registration
issued by the Securities and Exchange Commission (SEC),
Department of Trade and Industry (DTI), or the Cooperative
Development Authority (CDA) and other government
accrediting agencies, as the case may be;
b. The prospective investors place of operation of production
must be located within the Municipality;
c. The
investment
must
be
among
the
approved
Priority/Preferred Area of Investment;
d. The investment must provide employment among bonafide
residents of the Municipality;
e. The new enterprise must have a capitalization of :
1) At least Five Million Pesos (P5M) but not more than
Twenty Five Million Pesos (P25M), in case of a smallscale enterprise; and
2) Over Twenty-Five Million Pesos (P25M) but not more
than One Hundred Million Pesos (P100M), in case of a
medium-scale enterprise; and
3) More than One Hundred Million Pesos (P100M) in
case of large-scale industry.
f. The new enterprises must provide direct employment of:
1) Not less than ten (10) persons, in case of small-scale
enterprise
2) At least twenty-five (25) persons, in case of a mediumscale enterprise; and
3) At least seventy-five (75) persons, in case of largescale industry.
4)
Section 18. QUALIFICATION OF AN EXPANDING ENTERPRISE.
Existing enterprise which is expanding and/or diversifying, and
wishing to avail of the incentives under this Code must meet
the following qualifications:
a. Must have complied with all requirements mandated under
the existing local and national laws and the Constitution, by
and through the presentation of certificate of registration

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b.
c.

d.

e.

issued by either the SEC, DTI, or CDA and other national

government agencies, as the case may be:
The expansion and/or diversification must be among the
priority/preferred areas of investment;
The existing enterprise, whose place of operation or
production is already located within the Municipality, will
undertake any of the following activities/projects:
1) Relocate its principal office to the Municipality; or
2) Expand its existing production capacity or construct new
building and other civil works for the installation of new
machinery and equipment or improvements thereof
which will result in an increase in production capacity for
diversification project.
That the expansion/diversification shall have a capitalization
of :
1) At least One Million Pesos (P1M) but not more than Five
Million Pesos (P5M), in case of a small-scale enterprise;
2) Over Five Million Pesos (P5M) but not more than Fifteen
Million Pesos (P15M), in case of a medium-scale
enterprise;
3) More than Fifteen Million Pesos (P15M), in case of a
large-scale industry.
That the expansion/diversification shall provide a labor force
and/or employment of:
1) Not less than eight (8) persons, in case of a small-scale
enterprise;
2) At least fifteen (15) persons, in case of a medium-scale
enterprise;
3) At least forty (40) persons, in case of a large-scale
industry.

Section 19. QUALIFICATION

OF
PIONEERING
ENTERPRISE.
Pioneering enterprise status is given to investors that can meet
the following requirements:
a. Must have complied with all requirements mandated under
the existing local and national laws and the Constitution, by
and through the presentation of certification of registration
issued by either the SEC, DTI, CDA or other national
government accrediting agencies, as the case may be;
b. The pioneering enterprise must meet the following criteria:
1) Will engage in the manufacture, processing or
production, and not merely in the assembly of packaging
of goods, products, commodities or raw materials that
have been or are not being produced in the Philippines
on a commercial scale;
2) Will use 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 goods which is new and untried in the
Philippines and which will use superior technology;
3) Will engage in agricultural, forestry and mining activities
and/or services, predetermined by the Board, in
consultation with the appropriate Department, to be
feasible and highly essential to the attainment of the
national goal in relation to a declared national food and
agricultural program for self-sufficiency and other social
benefits of the projects;
4) Will produce non-conventional fuels or manufacture
equipment which utilize non-conventional fuels or
manufacture equipment which utilize non-conventional

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sources of energy or uses or converts to coal or other

non-conventional fuels or sources of energy in its
operation; Provided, that the final product in any
foregoing instance involves or will involve substantial use
and processing of domestic raw materials, whenever
available, taking into account the risk and magnitude of
investment.
c. The prospective investors place of operation or production
must be located within the Municipality;
d. The investment must be among the approve Preferred Areas
of Investment.
e. The pioneering enterprise must have a capitalization of:
1) At least Five Million Pesos (P5M) but not more than
Twenty Five Million Pesos (P25M), in case of small-scale
enterprise;
2) Over Twenty Five Million Pesos (P25M) but not more
than One Hundred Million Pesos (P100M), in case of a
medium-enterprise; and
3) More than One Hundred Million Pesos (P100M), in case
of large-scale industry.
Section 20. QUALIFICATION OF NON-PIONEERING ENTERPRISE
(Less Developed Areas). Activities or Enterprises that do not
meet the pioneer criteria are classified as Non-Pioneer. The
enterprise must meet the following requirements in order to
avail of the incentives:
a. The prospective investors place operation or production
must be located within the Municipality;
b. The investment must be among the approved preferred
areas of investment;
c. The investment must provide employment to local workers
or bonafide residents of the Municipality;
d. The Non-Pioneering enterprise must provide employment of:
1) Not less than ten (10) persons, in case of a small-scale
enterprise;
2) At least twenty-five (25) persons, in case of a mediumscale enterprise;
3) At least seventy-five (75) persons, in case of a large-scale
industry.
CHAPTER VII
INCENTIVES TO REGISTERED ENTERPRISES OR INVESTORS
Section 21. PREFERRED AREAS OF INVESTMENT. All registered
enterprises or investors under the Preferred Areas of
Investments shall be exempt from:
a. Payment of business taxes for a period of five (5) years from
the date of the issuance of the Business Permit by the
Municipality;
b. Payment of Real Property Tax on improvements for a period
of five (5) years from the date of the issuance of the
Business Permit by the Municipality.
Section 22. NON-PREFERRED AREAS OF INVESTMENT. All registered
enterprises or investors under the Non-Preferred Areas of
Investment shall be exempt from payment of Business and Real
Property Taxes under the following conditions from the date of
issuance of Business Permit by the Municipality:
CAPITALIZATION

EMPLOYMENT
GENERATED

PERIOD OF
EXEMPTION

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P5M P25M
P26M P75M
P76M P100M
P101M Above

At least 10 workers
At least 20 workers
At least 50 workers
At least 100 workers

2
3
4
5

years
years
years
years

The availment of the above mentioned privileges may be

granted provided that the investment is pursuant to the
purpose, intent and objective enunciated in Section 3 of this
Code.
CHAPTER VIII
APPROPRIATION
Section 23. APPROPRIATION. The Municipality shall appropriate the
funding requirement which is necessary for the immediate
implementation of the provisions of this Code based on the
budget presented by the Board.
CHAPTER IX
TRANSITORY PROVISIONS
Section 24. TRANSITORY PROVISION
a. Existing business establishment already enjoying the
benefits under existing National Laws prior to the
enactment of this Code may apply with the Board for the
availment of the incentives provided by this Code.
b. Whenever provision of this Code are inadequate to a given
situation, the applicable provisions of the national laws, its
implementation rules and regulation and administrative
guidelines shall apply in suppletory capacity in so far as they
are not inconsistent herewith.
c. Upon approval and publication of this Code, the Board shall
formulate the implementing rules and regulations for the
implementation of this Code.
CHAPTER X
FINAL PROVISIONS
Section 25. PENAL CLAUSE. Any violation of the provisions of this Code,
its implementing rules and regulations and other pertinent laws
shall be a ground for the cancellation of the registration of the
business, withdrawal of all incentives granted under this Code
as well as the refund of all the fiscal incentives granted
therewith, depending upon the determination of the Board.
Section 26. SEPARABILITY CLAUSE. The provisions of this Code are
hereby declared separable. The invalidity of one or more
provisions shall not affect the validity of the other provisions
thereof.
Section 27. REPEALING CLAUSE. All ordinances, executive orders, and
rules and regulations inconsistent with the provisions of this
Code are hereby repealed, amended, or modified accordingly.
Section 28. EFFECTIVITY. This ordinance shall take effect upon its
approval.
ENACTED: November 8, 2011.

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Voting on the Ordinance:

In Favor:
All
Members
Present
Not In Favor:
None
x--------------------------------------------------------------------------------------------------------------x
WE HEREBY CERTIFY as to the correctness of the foregoing
ordinance duly approved on third and final reading on November 8,
2011 during the 43rd SB Regular Session.

ROLANDO P. PALABRICA
Proponent/Sponsor

JURIS L. VILLAREAL
Co-Proponent/Co-Sponsor

REYNALDO O. NAMIA
Co-Proponent/Co-Sponsor

MARIA SOFIA O. ORPIADA

Co-Proponent/Co-Sponsor

STEPHEN O. OCFEMIA
Co-Proponent/Co-Sponsor

ROBERT M. BAAGA
Co-Proponent/Co-Sponsor

PAUL N. GARCIA
Co-Proponent/Co-Sponsor

PATRICK POLLY C. PINTOR

Co-Proponent /Co-Sponsor

WILFREDO O. AREVALO, SR.

Vice Mayor & Presiding Officer
ATTESTED:
CHRISTOPHER O. PALEVINO
Secretary to the Sangguniang Bayan
APPROVED: _________________, 2011
JUAN MIGUEL M. GARCIA
Municipal Mayor