You are on page 1of 263

LAWS ON BASES CONVERSION

TABLE OF CONTENTS
BCDA RELATED LAWS

Republic Act No. 7227

Executive Order No. 62

Republic Act No. 7917

Administrative Order No. 236

Executive Order No. 429

Executive Order No. 309

Executive Order No. 70

Executive Order No. 116

Proclamation No. 359

Executive Order No. 216

Executive Order No. 465

Executive Order No. 516

Republic Act No. 9400

ECONOMIC ZONE

Republic Act No. 7916

Republic Act No. 8748

Republic Act No. 9399

1
17
26
31
37
39
41
44
46
50
52
56
57

63
85
89

CLARK





FREEPORT ZONE
Proclamation No. 163
Executive Order No. 80
Proclamation No. 1035
Proclamation No. 805
Executive Order No. 464
Executive Order No. 7

92
95
98
101
103
105

CLARK







INTERNATIONAL AIRPORT
Executive Order No. 174
Executive Order No. 192
Executive Order No. 360
Executive Order No. 186
Executive Order No. 193
Executive Order No. 341
Executive Order No. 716
Executive Order No. 64

107
110
113
115
117
119
122
125

LAWS ON BASES CONVERSION

JOHN




HAY SPECIAL ECONOMIC ZONE


Proclamation No. 198

Executive Order No. 103

Proclamation No. 420

Executive Order No. 31

Proclamation No. 1191

PORO POINT FREEPORT ZONE



Proclamation No. 216

Executive Order No. 132

BATAAN BUSINESS AND LEISURE PARK


(Bataan Technology Park)

Proclamation No. 984


Executive Order No. 381


Executive Order No. 476

129
130
133
135
137

158
160

164
173
174

SUBIC-CLARK ALLIANCE FOR DEVELOPMENT COUNCIL



Executive Order No. 504




Executive Order No. 504-A




Executive Order No. 733


175
178
182

NORTHRAIL PROJECT

Executive Order No. 176

Executive Order No. 232

Executive Order No. 859

185
187
189

GOVERNMENT-OWNED OR -CONTROLLED CORPORATION



Executive Order No. 40



190

Executive Order No. 423



202

Executive Order No. 596



209

Republic Act No. 10149



212
NATIONAL ECONOMIC DEVELOPMENT AUTHORITY (NEDA)
JOINT VENTURE GUIDELINES AND PROCEDURES
228
REVISED ARMED FORCES OF THE PHILIPPINES (AFP)
MODERNIZATION PROGRAM (Republic Act No. 103491)
II

255

BCDA RELATED LAWS - Republic Act No. 7227

Republic Act No. 7227


An Act Accelerating the Conversion of Military Reservations into Other
Productive Uses, Creating the Bases Conversion and Development Authority
for this Purpose, Providing Funds Therefor and for Other Purposes
Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:
SECTION 1. SHORT TITLE.This Act shall be known as the Bases Conversion and
Development Act of 1992.
SECTION 2. DECLARATION OF POLICIES.It is hereby declared the policy of
the Government to accelerate the sound and balanced conversion into alternative
productive uses of the Clark and Subic military reservations and their extensions
(John Hay Station, Wallace Air Station, ODonnell Transmitter Station, San Miguel
Naval Communications Station and Capas Relay Station), to raise funds by the sale of
portions of Metro Manila military camps, and to apply said funds as provided herein
for the development and conversion to productive civilian use of the lands covered
under the 1947 Military Bases Agreement between the Philippines and the United
States of America, as amended.
It is likewise the declared policy of the Government to enhance the benefits to be
derived from said properties in order to promote the economic and social development
of Central Luzon in particular and the country in general.
SECTION 3. CREATION OF THE BASES CONVERSION AND DEVELOPMENT
AUTHORITY.There is hereby created a body corporate to be known as the Bases
Conversion and Development Authority, hereinafter referred to as the Conversion
Authority, which shall have the attribute of perpetual succession and shall be vested
with the powers of a corporation.
It shall be organized within thirty (30) days after approval of this Act. It shall have
a term of fifty (50) years from its organization: Provided, That Congress, by a joint
resolution, may dissolve the Conversion Authority whenever in its judgment the
primary purpose for its creation has been accomplished. It shall establish its principal
office in Metropolitan Manila unless otherwise provided by the Conversion Authority
and may put up such branches as may be necessary.
SECTION 4. PURPOSES OF THE CONVERSION AUTHORITY.The Conversion
Authority shall have the following purposes:
(a) To own, hold and/or administer the military reservations of John Hay Air
Station, Wallace Air Station, ODonnell Transmitter Station, San Miguel Naval
Communications Station, Mt. Sta. Rita Station (Hermosa, Bataan) and those

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

portions of Metro Manila military camps which may be transferred to it by the


President;
(b) To adopt, prepare and implement a comprehensive and detailed development
plan embodying a list of projects including but not limited to those provided in
the Legislative-Executive Bases Council (LEBC) framework plan for the sound
and balanced conversion of the Clark and Subic military reservations and their
extensions consistent with ecological and environmental standards, into other
productive uses to promote the economic and social development of Central
Luzon in particular and the country in general;
(c) To encourage the active participation of the private sector in transforming the
Clark and Subic military reservations and their extensions into other productive
uses;
(d) To serve as the holding company of subsidiary companies created pursuant to
Section 16 of this Act and to invest in Special Economic Zones declared under
Sections 12 and 15 of this Act;
(e) To manage and operate through private sector companies developmental
projects outside the jurisdiction of subsidiary companies and Special Economic
Zones declared by presidential proclamations and established under this Act;
(f) To establish a mechanism in coordination with the appropriate local
government units to effect meaningful consultation regarding the plans,
programs and projects within the regions where such plans, programs and/
or project development are part of the conversion of the Clark and Subic
military reservations and their extensions and the surrounding communities as
envisioned in this Act; and
(g) To plan, program and undertake the readjustment, relocation, or resettlement of
population within the Clark and Subic military reservations and their extensions
as may be deemed necessary and beneficial by the Conversion Authority, in
coordination with the appropriate government agencies and local government
units.
SECTION 5. POWERS OF THE CONVERSION AUTHORITY.To carry out its
objectives under this Act, the Conversion Authority is hereby vested with the following
powers:
(a) To succeed in its corporate name, to sue and be sued in such corporate name
and to adopt, alter and use a corporate seal which shall be judicially noticed;
(b) To adopt, amend and repeal its bylaws;
(c) To enter into, make, perform and carry out contracts of every class, kind and
Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

description which are necessary or incidental to the realization of its purposes


with any person, firm or corporation, private or public, and with foreign
government entities;
(d) To contract loans, indebtedness, credit and issue commercial papers and
bonds, in any local or convertible foreign currency from any international
financial institutions, foreign government entities, and local or foreign private
commercial banks or similar institutions under terms and conditions prescribed
by law, rules and regulations;
(e) To execute any deed of guarantee, mortgage, pledge, trust or assignment of any
property for the purpose of financing the programs and projects deemed vital
for the early attainment of its goals and objectives, subject to the provisions of
Article VII, Section 20, and Article XII, Section 2, paragraphs (4) and (5) of the
Constitution;
(f) To construct, own, lease, operate and maintain public utilities as well as
infrastructure facilities;
(g) To reclaim or undertake reclamation projects as it may deem necessary in
areas adjacent or contiguous to the Conversion Authoritys lands described in
Section 7 of this Act either by itself or in collaboration with the Public Estates
Authority (PEA) established under Presidential Decree No. 1084 as amended;
(h) To acquire, own, hold, administer, and lease real and personal properties,
including agricultural lands, property rights and interests and encumber, lease,
mortgage, sell, alienate or otherwise dispose of the same at fair market value it
may deem appropriate;
(i) To receive donations, grants, bequests and assistance of all kinds from local
and foreign governments and private sectors and utilize the same;
(j) To invest its funds and other assets other than those of the Special Economic
Zones under Sections 12 and 15 of this Act in such areas it may deem wise;
(k) To exercise the right of eminent domain;
(l) To exercise oversight functions over the Special Economic Zones declared
under this Act and by subsequent presidential proclamations within the
framework of the declared policies of this Act;
(m) To promulgate all necessary rules and regulations; and
(n) To perform such other powers as may be necessary and proper to carry out the
purposes of this Act.

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

SECTION 6. CAPITALIZATION.The Conversion Authority shall have an authorized


capital of One hundred billion pesos (P100,000,000,000) which may be fully
subscribed by the Republic of the Philippines and shall either be paid up from the
proceeds of the sales of its land assets as provided for in Section 8 of this Act or by
transferring to the Conversion Authority properties valued in such amount.
An initial operating capital in the amount of Seventy million pesos (P70,000,000)
is hereby authorized to be appropriated out of any funds in the National Treasury not
otherwise appropriated which shall be covered by preferred shares of the Conversion
Authority retireable within two (2) years.
SECTION 7. TRANSFER OF PROPERTIES.Pursuant to paragraph (a), Section 4 hereof,
the President shall transfer forthwith to the Conversion Authority:
(a) Station

Area in has.
(more or less)

John Hay Air Station

570

Wallace Air Station

167

O Donnell Transmitter Station

1,755

San Miguel Naval


Communications Station

1,100

Mt. Sta. Rita Station (Hermosa, Bataan)


(b) Such other properties including, but not limited to, portions of Metro Manila
military camps, pursuant to Section 8 of this Act: Provided, however, That
the areas which shall remain as military reservations shall be delineated and
proclaimed as such by the President.

SECTION 8. FUNDING SCHEME.The capital of the Conversion Authority shall


come from the sales proceeds and/or transfers of certain Metro Manila military camps,
including all lands covered by Proclamation No. 423, series of 1957, commonly
known as Fort Bonifacio and Villamor (Nichols) Air Base, namely:
Camp

Area in has.
(more or less)

Phase I (for immediate disposal)


1. Camp Claudio
2. Camp Bago Bantay
3. Part of Villamor Air Base

2.0
5.0
135.10

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

4. Part of Fort Bonifacio


498.40
Total 640.50

Phase II
1. Camp Ver
2. Camp Melchor
3. Camp Atienza
4. Part of Villamor Air Base
5. Part of Fort Bonifacio
6. Fort Abad
Total

1.9
1.0
4.9
37.9
224.90
.60
271.20

Provided, That the following areas shall be exempt from sale:


(a) Approximately 148.80 hectares in Fort Bonifacio for the National Capital
Region (NCR) Security Brigade, Philippine Army (PA) officers housing area,
and Philippine National Police (PNP) jails and support services (presently
Camp Bagong Diwa);
(b) Approximately 99.91 hectares in Villamor Air Base for the Presidential Airlift
Wing, one squadron of helicopters for the NCR and respective security units;
(c) The following areas segregated by Proclamation Nos.:
(1)
(2)
(3)
(4)
(5)
(6)

(7)
(8)
(9)
(10)
(11)
(12)
(13)
(14)
(15)

(16)

(17)

461, series of 1965; (AFP Officers Village)


462, series of 1965; (AFP Enlisted Mens Village)
192, series of 1967; (Veterans Center)
208, series of 1967; (National Shrines)
469, series of 1969; (Philippine College of Commerce)
653, series of 1970; (National Manpower and
Youth Council)
684, series of 1970; (University Center)
1041, series of 1972; (Open Lease Concession)
1160, series of 1973; (Manila Technical Institute)
1217, series of 1973; (Maharlika Village)
682, series of 1970; (Civil Aviation Purposes)
1048, series of 1975; (Civil Aviation Purposes)
1453, series of 1975; (National Police Commission)
1633, series of 1977; (Housing and Urban Development)
2219, series of 1982; (Ministry of Human
Settlements, BLISS)
172, series of 1987; (Upper, Lower and Western Bicutan
and Signal Housing)
389, series of 1989; (National Mapping and Resource
Information Authority)

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

(18) 518, series of 1990; (CEMBO, SO CEMBO, W REMBO, E REMBO,


COMEMBO, PEMBO, PITOGO)
(19) 467, series of 1968; (Greater Manila Terminal Food Market Site)
(20) 347, series of 1968; (Greater Manila Food Market Site)
(21) 376, series of 1968; (National Development Board and Science
Community)
(d) A proposed 30.15 hectares as relocation site for families to be affected by
circumferential road 5 and radial road 4 construction: Provided, further, That
the boundaries and technical descriptions of these exempt areas shall be
determined by an actual ground survey.

The President is hereby authorized to sell the above lands, in whole or in part,
which are hereby declared alienable and disposable, pursuant to the provisions
of existing laws and regulations governing sales of government properties:
Provided, That no sale or disposition of such lands will be undertaken until
a development plan embodying projects for conversion shall be approved
by the President in accordance with paragraph (b), Section 4, of this Act.
However, six (6) months after approval of this Act, the President shall authorize
the Conversion Authority to dispose of certain areas in Fort Bonifacio and
Villamor as the latter so determines. The Conversion Authority shall provide
the President a report on any such disposition or plan for disposition within
one (1) month from such disposition or preparation of such plan. The proceeds
from any sale, after deducting all expenses related to the sale, of portions of
Metro Manila military camps as authorized under this Act, shall be used for the
following purposes with their corresponding percent shares of proceeds:
(1) Thirty-two and five-tenths percent (32.5%) - To finance the transfer of the
AFP military camps and the construction of new camps, the self-reliance
and modernization program of the AFP, the concessional and long-term
housing loan assistance and livelihood assistance to AFP officers and
enlisted men and their families, and the rehabilitation and expansion of
the AFPs medical facilities;
(2) Fifty percent (50%) - To finance the conversion and commercial uses of
the Clark and Subic military reservations and their extensions;

(3) Five percent (5%) - To finance the concessional and long-term housing
loan assistance for the homeless of Metro Manila, Olongapo City,
Angeles City and other affected municipalities contiguous to the
base areas as mandated herein; and

(4) The balance shall accrue and be remitted to the National Treasury to be
appropriated thereafter by Congress for the sole purpose of financing
programs and projects vital for the economic upliftment of the Filipino
people.
Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

Provided, That, in the case of Fort Bonifacio, two and five tenths percent (2.5%) of the
proceeds thereof in equal shares shall each go to the Municipalities of Makati, Taguig
and Pateros: Provided, further, That in no case shall farmers affected be denied due
compensation.
With respect to the military reservations and their extensions, the President upon
recommendation of the Conversion Authority or the Subic Authority when it concerns
the Subic Special Economic Zone shall likewise be authorized to sell or dispose those
portions of lands which the Conversion Authority or the Subic Authority may find
essential for the development of their projects.
SECTION 9. BOARD OF DIRECTORS: COMPOSITION.The powers and functions of
the Conversion Authority shall be exercised by a Board of Directors to be composed
of nine (9) members, as follows:
(a) A full-time chairman who shall also be the president of the Conversion
Authority; and
(b) Eight (8) other members from the private sector, two (2) of whom coming from
the labor sector.
The chairman and members shall be appointed by the President with the consent
of the Commission on Appointments. Of the initial members of the Board, three (3)
including the chairman, a representative from the private sector and a representative
from the labor sector shall be appointed for a term of six (6) years, three (3) for a term
of four (4) years and the other three (3) for a term of two (2) years. In case of vacancy in
the Board, the appointee shall serve the unexpired term of the predecessor.
No person shall be appointed or designated unless he is a natural-born Filipino citizen,
of good moral character, of unquestionable integrity, and of recognized competence
in relevant fields including, but not limited to, economics, management, international
relations, law or engineering, preferably naval or aeronautical.
The chairman and president of the Conversion Authority shall have a fixed term of six
(6) years.
All procedural matters in the conduct of board meetings shall be prescribed in its
internal rules.
Members of the Board shall receive a per diem of not more than Five thousand pesos
(P5,000.00) for every board meeting: Provided, however, That the per diem collected
per month does not exceed the equivalent of four (4) meetings: Provided, further, That
the amount of per diem for every board meeting may be increased by the President but
such amount shall not be increased within two (2) years after its last increase.

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

SECTION 10. FUNCTIONS OF THE BOARD.The Board of Directors shall be the


policy-making body of the Conversion Authority and shall perform the following
functions:
(a) Determine the organizational structure of the Conversion Authority, define
the duties and responsibilities of all officials and employees and adopt a
compensation and benefit scheme at least equivalent to that of the Central
Bank of the Philippines;
(b) Appoint all officials down to the third level and authorize the president of the
Conversion Authority to appoint all others: Provided, That all appointments
shall be on the basis of merit and fitness and all personnel action shall be
in pursuance of Civil Service Laws, rules and regulations, except those
coterminous employees of the members of the Board;
(c) Prepare the annual and supplemental budgets of the Conversion Authority;

(d) Submit an annual report of the operation of the Conversion Authority to the
President of the Philippines, President of the Senate and Speaker of the House
of Representatives;
(e) Carry out the purposes of the Conversion Authority with the following terms
and references:
(1) As much as possible, major conversion projects shall be undertaken under
the complete project turnkey or build-operate-transfer (BOT) scheme, as
provided under Republic Act Numbered Sixty-nine hundred and fiftyseven (RA 6957); and
(2) Starting the fourth year of the Conversion Authoritys full operation,
a privatization or divestment program of its projects and subsidiaries
shall begin under general guidelines prescribed by the President of the
Philippines.
SECTION 11. DUTIES AND RESPONSIBILITIES OF THE PRESIDENT OF THE
CONVERSION AUTHORITY.The president of the Conversion Authority shall have
the following duties and responsibilities:
(a) To act as Chief Executive Officer of the Conversion Authority;
(b) To execute, administer and implement the policies and measures approved by
the Board;
(c) To direct and supervise the operations and administration of the Conversion
Authority;

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

(d) To represent the Conversion Authority in all dealings with offices, agencies
and instrumentalities of the Government and with all persons and entities,
public or private, domestic or foreign;
(e) To direct and supervise the preparation of the agenda for the meeting of the
Board, and to submit for the consideration of the Board such policies and
measures as he believes necessary to carry out the purposes and objectives of
this Act; and
(f) To exercise such other powers and functions provided in the bylaws and as
may be vested in him by the Board.
SECTION 12. SUBIC SPECIAL ECONOMIC ZONE.Subject to the concurrence by
resolution of the Sangguniang Panlungsod of the City of Olongapo and the Sangguniang
Bayan of the Municipalities of Subic, Morong and Hermosa, there is hereby created
a Special Economic and Free-port Zone consisting of the City of Olongapo and the
Municipality of Subic, Province of Zambales, the lands occupied by the Subic Naval
Base and its contiguous extensions as embraced, covered, and defined by the 1947
Military Bases Agreement between the Philippines and the United States of America
as amended, and within the territorial jurisdiction of the Municipalities of Morong and
Hermosa, Province of Bataan, hereinafter referred to as the Subic Special Economic
Zone whose metes and bounds shall be delineated in a proclamation to be issued by
the President of the Philippines. Within thirty (30) days after the approval of this Act,
each local government unit shall submit its resolution of concurrence to join the Subic
Special Economic Zone to the Office of the President. Thereafter, the President of the
Philippines shall issue a proclamation defining the metes and bounds of the zone as
provided herein.
The abovementioned zone shall be subject to the following policies:
(a) Within the framework and subject to the mandate and limitations of the
Constitution and the pertinent provisions of the Local Government Code,
the Subic Special Economic Zone shall be developed into a self-sustaining,
industrial, commercial, financial and investment center to generate employment
opportunities in and around the zone and to attract and promote productive
foreign investments;
(b) The Subic Special Economic Zone shall be operated and managed as a separate
customs territory ensuring free flow or movement of goods and capital within,
into and exported out of the Subic Special Economic Zone, as well as provide
incentives such as tax and duty-free importations of raw materials, capital and
equipment. However, exportation or removal of goods from the territory of the
Subic Special Economic Zone to the other parts of the Philippine territory shall
be subject to customs duties and taxes under the Customs and Tariff Code and
other relevant tax laws of the Philippines;

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

(c) The provisions of existing laws, rules and regulations to the contrary
notwithstanding, no taxes, local and national, shall be imposed within the
Subic Special Economic Zone. In lieu of paying taxes, three percent (3%) of the
gross income earned by all businesses and enterprises within the Subic Special
Economic Zone shall be remitted to the National Government, one percent (1%)
each to the local government units affected by the declaration of the zone in
proportion to their population area and other factors. In addition, there is hereby
established a development fund of one percent (1%) of the gross income earned
by all businesses and enterprises within the Subic Special Economic Zone to be
utilized for the development of municipalities outside the City of Olongapo and
the Municipality of Subic, and other municipalities contiguous to the base areas.

In case of conflict between national and local laws with respect to tax
exemption privileges in the Subic Special Economic Zone, the same shall be
resolved in favor of the latter;

(d) No exchange control policy shall be applied and free markets for foreign
exchange, gold, securities and future shall be allowed and maintained in the
Subic Special Economic Zone;
(e) The Central Bank, through the Monetary Board, shall supervise and regulate
the operations of banks and other financial institutions within the Subic Special
Economic Zone;
(f) Banking and finance shall be liberalized with the establishment of foreign
currency depository units of local commercial banks and offshore banking
units of foreign banks with minimum Central Bank regulation;
(g) Any investor within the Subic Special Economic Zone whose continuing
investment shall not be less than Two hundred fifty thousand dollars ($250,000),
his/her spouse and dependent children under twenty-one (21) years of age,
shall be granted permanent resident status within the Subic Special Economic
Zone. They shall have freedom of ingress and egress to and from the Subic
Special Economic Zone without any need of special authorization from the
Bureau of Immigration and Deportation. The Subic Bay Metropolitan Authority
referred to in Section 13 of this Act may also issue working visas renewable
every two (2) years to foreign executives and other aliens possessing highlytechnical skills which no Filipino within the Subic Special Economic Zone
possesses, as certified by the Department of Labor and Employment. The names
of aliens granted permanent residence status and working visas by the Subic
Bay Metropolitan Authority shall be reported to the Bureau of Immigration and
Deportation within thirty (30) days after issuance thereof;
(h) The defense of the zone and the security of its perimeters shall be the
responsibility of the National Government in coordination with the Subic Bay
Laws on Bases Conversion

10

BCDA RELATED LAWS - Republic Act No. 7227

Metropolitan Authority. The Subic Bay Metropolitan Authority shall provide


and establish its own internal security and firefighting forces; and

(i) Except as herein provided, the local government units comprising the Subic
Special Economic Zone shall retain their basic autonomy and identity. The
cities shall be governed by their respective charters and the municipalities shall
operate and function in accordance with Republic Act No. 7160, otherwise
known as the Local Government Code of 1991.
SECTION 13. THE SUBIC BAY METROPOLITAN AUTHORITY.
(a) Creation of the Subic Bay Metropolitan Authority - A body corporate to
be known as the Subic Bay Metropolitan Authority is hereby created as an
operating and implementing arm of the Conversion Authority.
(b) Powers and Functions of the Subic Bay Metropolitan Authority - The Subic Bay
Metropolitan Authority, otherwise known as the Subic Authority, shall have the
following powers and functions:
(1) To operate, administer, manage and develop the ship repair and ship
building facility, container port, oil storage and refueling facility and Cubi
Air Base within the Subic Special Economic and Free-port Zone as a free
market in accordance with the policies set forth in Section 12 of this Act;
(2) To accept any local or foreign investment, business or enterprise, subject only
to such rules and regulations to be promulgated by the Subic Authority in
conformity with the policies of the Conversion Authority without prejudice to
the nationalization requirements provided for in the Constitution;
(3) To undertake and regulate the establishment, operation and maintenance
of utilities, other services and infrastructure in the Subic Special Economic
Zone including shipping and related business, stevedoring and port
terminal services or concessions, incidental thereto and airport operations in
coordination with the Civil Aeronautics Board, and to fix just and reasonable
rates, fares, charges and other prices therefor;
(4) To construct, acquire, own, lease, operate and maintain on its own or
through contract, franchise, license permits bulk purchase from the private
sector and build-operate-transfer scheme or joint-venture the required
utilities and infrastructure in coordination with local government units
and appropriate government agencies concerned and in conformity with
existing applicable laws therefor;
(5) To adopt, alter and use a corporate seal; to contract, lease, sell, dispose,
acquire and own properties; to sue and be sued in order to carry out its

11

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

duties and functions as provided for in this Act and to exercise the power
of eminent domain for public use and public purpose;
(6) Within the limitation provided by law, to raise and/or borrow the necessary
funds from local and international financial institutions and to issue bonds,
promissory notes and other securities for that purpose and to secure the
same by guarantee, pledge, mortgage, deed of trust, or assignment of its
properties held by the Subic Authority for the purpose of financing its
projects and programs within the framework and limitations of this Act;
(7) To operate directly or indirectly or license tourism-related activities subject
to priorities and standards set by the Subic Authority including games
and amusements, except horse racing, dog racing and casino gambling
which shall continue to be licensed by the Philippine Amusement and
Gaming Corporation (PAGCOR) upon recommendation of the Conversion
Authority; to maintain and preserve the forested areas as a national park;
(8) To authorize the establishment of appropriate educational and medical
institutions;
(9) To protect, maintain and develop the virgin forests within the baselands
which will be proclaimed as a national park and subject to a permanent
total log ban, and for this purpose, the rules and regulations of the
Department of Environment and Natural Resources and other government
agencies directly involved in the above functions shall be implemented by
the Subic Authority;
(10) To adopt and implement measures and standards for environmental
pollution control of all areas within its territory, including, but not limited
to all bodies of water and to enforce the same. For which purpose the
Subic Authority shall create an Ecology Center; and
(11) To exercise such powers as may be essential, necessary or incidental to
the powers granted to it hereunder as well as to carry out the policies and
objectives of this Act.
(c) Board of Directors - The powers of the Subic Authority shall be vested in and
exercised by a Board of Directors, hereinafter referred to as the Board, which
shall be composed of fifteen (15) members, to wit:
(1) Representatives of the local government units that concur to join the Subic
Special Economic Zone;
(2) Two (2) representatives from the National Government;
(3) Five (5) representatives from the private sector coming from the present

Laws on Bases Conversion

12

BCDA RELATED LAWS - Republic Act No. 7227

naval stations, public works center, ship repair facility, naval supply depot
and naval air station; and

(4) The remaining balance to complete the Board shall be composed of


representatives from the business and investment sectors.

The chairman and the members of the Board shall be appointed by the
President to serve for a term of six (6) years, unless sooner removed for cause
except for the representatives of the local government units who shall serve for
a term of three (3) years. In case of removal for cause, the replacement shall
serve only the unexpired portion of the term.

No person shall be appointed as a member of the Board unless he is a Filipino


citizen, of good moral character, and of recognized competence in relevant
fields including, but not limited to, economics, management, international
relations, law or engineering. Preference in the appointment of the members of
the Board shall be given to residents within the Subic Special Economic Zone.

Members of the Board shall receive a per diem of not more than Five thousand
pesos (P5,000.00) for every board meeting: Provided, however, That the per
diem collected per month does not exceed the equivalent of four (4) meetings:
Provided; further, That the amount of per diem for every board meeting may
be increased by the President: Provided, finally, That the amount of per diem
shall not be increased within two (2) years after its last increase.

(d) Chairman/Administrator - The President shall appoint a professional manager


as administrator of the Subic Authority with a compensation to be determined
by the Board subject to the approval of the Secretary of Budget, who shall be
the ex officio chairman of the Board and who shall serve as the chief executive
officer of the Subic Authority: Provided, however, That for the first year of its
operations from the effectivity of this Act, the mayor of the City of Olongapo
shall be appointed as the chairman and chief executive officer of the Subic
Authority.
(e) Capitalization - The Subic Authority shall have an authorized capital stock
of Twenty billion pesos (P20,000,000,000.00) divided into twenty thousand
(P20,000.00) no-par shares fully subscribed and paid up by the Republic of the
Philippines with:
(1) All lands embraced, covered and defined in Section 12 hereof, as well as
permanent improvements and fixtures upon proper inventory not otherwise
alienated, conveyed or transferred to another government agency;
(2) All other assets which the President may transfer to the Subic Authority as
part of the equity contribution of the Government; and

13

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

(3) Cash contribution by the Government in the amount of Three hundred


million pesos (P300,000,000.00) a year for the next three (3) years, which
is hereby appropriated out of any fund in the National Treasury not
otherwise appropriated.
SECTION 14. RELATIONSHIP WITH THE CONVERSION AUTHORITY AND THE
LOCAL GOVERNMENT UNITS.
(a) The provisions of existing laws, rules and regulations to the contrary
notwithstanding, the Subic Authority shall exercise administrative powers,
rule-making and disbursement of funds over the Subic Special Economic Zone
in conformity with the oversight function of the Conversion Authority.
(b) In case of conflict between the Subic Authority and the local government units
concerned on matters affecting the Subic Special Economic Zone other than
defense and security, the decision of the Subic Authority shall prevail.
SECTION 15. CLARK AND OTHER SPECIAL ECONOMIC ZONES. Subject to the
concurrence by resolution of the local government units directly affected, the President
is hereby authorized to create by executive proclamation a Special Economic Zone
covering the lands occupied by the Clark military reservations and its contiguous
extensions as embraced, covered and defined by the 1947 Military Bases Agreement
between the Philippines and the United States of America, as amended, located
within the territorial jurisdiction of Angeles City, Municipalities of Mabalacat and
Porac, Province of Pampanga, and the Municipality of Capas, Province of Tarlac, in
accordance with the policies as herein provided insofar as applicable to the Clark
military reservations.
The governing body of the Clark Special Economic Zone shall likewise be established
by executive proclamation with such powers and functions exercised by the Export
Processing Zone Authority pursuant to Presidential Decree No. 66 as amended.
The policies to govern and regulate the Clark Special Economic Zone shall be
determined upon consultation with the inhabitants of the local government units
directly affected which shall be conducted within six (6) months upon approval of this
Act.
Similarly, subject to the concurrence by resolution of the local government units directly
affected, the President shall create other Special Economic Zones, in the base areas
of Wallace Air Station in San Fernando, La Union (excluding areas designated for
communications, advance warning and radar requirements of the Philippine Air Force
to be determined by the Conversion Authority) and Camp John Hay in the City of Baguio.
Upon recommendation of the Conversion Authority, the President is likewise authorized
to create Special Economic Zones covering the Municipalities of Morong, Hermosa,
Dinalupihan, Castillejos and San Marcelino.
Laws on Bases Conversion

14

BCDA RELATED LAWS - Republic Act No. 7227

SECTION 16. SUBSIDIARIES.The Conversion Authority shall have the power


to form, establish, organize and maintain a subsidiary corporation or corporations.
Such subsidiary or subsidiaries shall be formed in accordance with the Philippine
Corporation Law and existing rules and regulations promulgated by the Securities
and Exchange Commission, unless otherwise provided in this Act. In all cases, the
Conversion Authority shall own initially at least fifty-one per centum (51%) of the
capital stock of subsidiary. The Conversion Authority shall also initially have the
majority of the Board of Directors of the subsidiaries, of which at least one (1) director
shall be the chairman of the Conversion Authority and a second director shall be the
president of the Conversion Authority or his designated representative.
Such subsidiaries shall be exempt from the coverage of the Civil Service Laws, rules
and regulations.
SECTION17. SUPERVISION.The Conversion Authority shall be under the direct
control and supervision of the Office of the President for purposes of policy direction
and coordination.
SECTION 18. LEGAL COUNSEL.Without prejudice to the hiring of an outside
counsel, the Government Corporate Counsel shall be the ex officio legal counsel of
the Conversion Authority, the governing boards of the Special Economic Zones and
the subsidiaries wherein the Conversion Authority owns the majority of the shares
of stocks, and for this purpose he may designate a full time representative whose
compensation shall be approved by the Board.
SECTION 19. AUDITOR.The Commission on Audit shall appoint a representative
who shall be the full time auditor of the Conversion Authority, its subsidiaries and
the Special Economic Zones and such personnel as may be necessary to assist said
representative in the performance of his duties. He is mandated to impose pre-audit
within thirty (30) days after submission of all proposed substantial sales, transfers, and
alienations of property. He shall likewise render a full report thereof to Congress every
sixty (60) days. The salaries of the auditor and his staff shall be approved by the Board.
SECTION 20. INTERIM CAPACITY.Except for the chairman of the Subic Authority,
the chairman and other members of the Board of the Conversion Authority and the
Subic Authority shall act in an interim capacity and shall serve until the 31st of July
1992 or until such time that their successors shall have been duly appointed.
SECTION 21. INJUNCTION AND RESTRAINING ORDER.The implementation of the
projects for the conversion into alternative productive uses of the military reservations
are urgent and necessary and shall not be restrained or enjoined except by an order
issued by the Supreme Court of the Philippines.

15

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7227

SECTION 22. SEPARABILITY CLAUSE.If any provision of this Act shall be held
unconstitutional or invalid, the other provisions not otherwise affected shall remain in
full force and effect.
SECTION 23. REPEALING CLAUSE.All laws, executive issuances or parts thereof
which are inconsistent herewith are hereby repealed or amended accordingly.
SECTION 24. EFFECTIVITY CLAUSE.This act shall take effect upon its publication in
at least one (1) newspaper of general circulation.
Approved,

(Sgd.) NEPTALI A. GONZALES


President of the Senate


(Sgd.) RAMON V. MITRA


Speaker of the
House of Representatives

This Act which is a consolidation of House Joint Resolution No. 10 and Senate Bill
No. 1648 was finally passed by the House of Representatives and the Senate on
February 5, 1992 and February 6, 1992, respectively.

(Sgd.) ANACLETO D. BADOY, JR.


Secretary of the Senate

(Sgd.) CAMILO L. SABIO


Secretary General
House of Representatives

Approved: March 13, 1992


(Sgd.) CORAZON C. AQUINO
President of the Philippines

Laws on Bases Conversion

16

BCDA RELATED LAWS - Executive Order No. 62

Executive Order No. 62


Prescribing Policies and Guidelines
to Implement Republic Act No. 7227
WHEREAS, Republic Act No. 7227, otherwise known as the Bases Conversion and
Development Act of 1992 (Act), creates the Bases Conversion and Development
Authority (BCDA) and defines its powers and functions;
WHEREAS, the Act also creates the Subic Bay Metropolitan Authority (SBMA) and
stipulates that the BCDA may create subsidiaries, joint ventures, authorities and special
economic zones in implementing the conversion program;
WHEREAS, the National Government is committed to the alleviation of poverty and
the further empowerment of the people to be carried out under the Medium Term
Philippine Development Plan (1993-1998) which emphasizes national unification,
sustained economic growth, accelerated infrastructure development, protection of the
environment, and streamlining of the bureaucracy;
WHEREAS, responsive policy guidelines are needed to clarify the oversight and
management functions of the BCDA in relation with the subsidiaries and attached
authorities;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Philippines, by virtue
of the powers vested in me by law, and upon recommendation of the Chairman of the
BCDA, do hereby order the adoption and implementation of the following policies and
guidelines:
SECTION 1. POLICY FRAMEWORK.The BCDA shall be guided by the following
policy framework in its conversion program:
1.1 The primary objective of the conversion program is to create immediate
employment and livelihood opportunities utilizing existing world class
infrastructure and support facilities in the reverted baselands in line with
the national government objective of property alleviation and sustained
economic recovery and growth;
1.2 The preparation and implementation of conversion development plans shall
be undertaken with the active and meaningful participation of the private
sector, including non-governmental and peoples organizations, and affected
local communities;
1.3 The BCDA shall adopt investor-friendly policies, rules and regulations and
create an efficient business environment with no or minimum bureaucratic
red tape to attract local and foreign investments;

17

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 62

1.4 The BCDA shall plan and implement fund generating projects which will
maximize the use of the military camps in Metro Manila that shall be sold
pursuant to Section 8 of the Act with the funds generated therefrom to be
strictly utilized as provided for in the Act; and
1.5 Conversion projects must be financially self-sustaining in the long term and
should contribute significantly to national economic development.
SECTION 2. PURPOSES OF THE BCDA.As provided in Section 4 of the Act, the
BCDA shall have the following purposes:
2.1 Own, hold and administer the reverted baselands and the portions of Metro
Manila military camps transferred to it, and adopt, prepare and implement
a comprehensive and detailed development program for its subsidiaries and
attached authorities in consonance with the following directional plans:

2.1.1 Subic Naval Base. To be developed as a special economic and freeport zone ensuring the free flow of goods and capital in accordance
with prescribed rules, to generate employment opportunities in and
around the zone, and to attract and promote productive local and
foreign investments. The Subic Special Economic and Free-port Zone
shall be developed, operated, administered, and managed by the
SBMA;

2.1.2 Clark Air Base. To be developed as a special economic zone with


such incentives and privileges granted the Subic Special Economic
and Free-port Zone and Export Processing Zones. The Clark Special
Economic Zone (CSEZ) shall form part of the growth triad connecting
with Subic and Metro Manila as a buffer to in-migration to the
metropolis. The CSEZ is envisioned as a new industrial townsite and a
major civil aviation complex for international passenger and/or cargo;

2.1.3 Camp John Hay. To be preserved, maintained, enhanced and developed


as a forest watershed and tourist destination. The natural attributes
and character of the Camp shall be maintained. The facilities shall be
developed with the expertise of the private sector to maximize its potential
for both local and foreign tourism;

2.1.4 Other Baselands. The Wallace Air Station, ODonnel Transmitter


Station, San Miguel Naval Communication Station and Mt. Sta. Rita
Station shall be developed in accordance with its best land use and
the national concerns as stated in the Act and as may be determined
by the President in line with national priorities;

2.1.5 Other Special Economic Zones. To create, develop and manage


other special economic zones covering the municipalities of Morong,

Laws on Bases Conversion

18

BCDA RELATED LAWS - Executive Order No. 62

Hermosa, Dinalupihan in Bataan and Castillejos, San Antonio and San


Marcelino in Zambales subject to economic viability studies; and

2.1.6 Metro Manila Military Camps. To develop and/or dispose of portions


of the military camps transferred to the BCDA for other productive uses
to generate funds for base conversion, military housing and military
modernization. The timetable of disposition and conversion of Metro
Manila camps shall be approved by the President of the Philippines
in close coordination with the Department of National Defense and
Armed Forces of the Philippines.

2.2 Encourage the active and meaningful participation of the private sector in
financing, managing and overseeing conversion projects, particularly in
Clark and Subic;
2.3 Establish a mechanism of coordination with the appropriate local government
units to effect meaningful consultation with communities affected by the
conversion plans and projects;
2.4 Serve as the holding company of subsidiary companies, to coordinate
attached authorities, invest in special economic zones, and manage and
operate development projects through private sector companies; and
2.5 Plan and undertake the readjustment, relocation or resettlement of population
within the baselands and their extensions, particularly the affected military
personnel, in coordination with appropriate local government units and
government agencies, particularly the Department of National Defense and
Armed Forces of the Philippines.
SECTION 3. SUBSIDIARIES AND ATTACHED AUTHORITIES.The BCDA shall have
the power to form, establish, organize and maintain subsidiary corporation(s) pursuant
to Section 16 of the Act.
In accordance with Section 14 (a) of the Act, the BCDA shall exercise oversight function
over the SBMA.
To perform its oversight function over subsidiaries, attached authorities and special
economic zones declared under the Act, including SBMA, the BCDA shall adopt
and implement an effective oversight mechanism to encourage efficient utilization of
scarce government resources and to ensure that plans and programs of subsidiaries,
attached authorities and special economic zones are proceeding according to national
goals and objectives.
3.1 Governing Board of Directors. The subsidiaries and attached authorities shall
be governed by their respective policy making Board of Directors which
shall perform the following, subject to existing laws and regulations:

19

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 62

3.1.1 Approve corporate plans and programs consistent with the policy
directions of the BCDA;

3.1.2 Approve and adopt internal administrative and operating rules and
regulations for implementation by the officials and management of the
subsidiary or attached authority;

3.1.3 Establish financial and operations performance targets for management


as basis for evaluating and monitoring corporate performance;

3.1.4 Determine the organizational structure, define the duties and


responsibilities of all officials, adopt a pay plan and position
classification;

3.1.5 Appoint all officials down to the third level and authorize the President of
the subsidiary or attached authority to appoint all others: Provided that,
all appointments shall be on the basis of merit, experience, integrity and
fitness;

3.1.6 Prepare and approve the annual and supplemental budget of the
subsidiary or attached authority;

3.1.7 Approve capital expenditures and investments program, all forms of


indebtedness, substantial sales, transfers and alienation of assets and
properties of the subsidiary or attached authority;

3.1.8 Require management to periodically submit to the Board such


management reports as may be required by it to include, among others,
the following: annual budgets, organization, personnel plantilla and
programs, report of operations, infrastructure programs and major
capital investment programs;

3.1.9 Develop and implement a privatization, commer-cialization and/or


divestment program of all its major assets and facilities within two (2)
years from start of operation: Provided that, by the fourth year of full
operation, a privatization or divestment program shall have been in
place; and

3.1.10 Submit to the BCDA a copy of its management reports to include, among
others, the following: annual budgets, organization, personnel, report of
operations, infrastructure program and capital investments program, and
any other report which the BCDA may require.

3.2 Organization. Organization of subsidiaries or attached authorities shall have


the following common features, subject to existing laws and regulations:

Laws on Bases Conversion

20

BCDA RELATED LAWS - Executive Order No. 62

3.2.1 The powers and functions of the subsidiaries or attached authorities of


the BCDA shall be exercised by their respective Board of Directors to
be appointed by the President of the Philippines upon recommendation
of the Chairman of the BCDA. The Board shall be composed of a
minimum of seven (7) members who being trustees of the Government,
may be removed at any time by the President;

3.2.2 The governing Board of each subsidiary and attached authority shall
approve the annual budget, plans and programs, organization, and
personnel plantilla of the subsidiary or authority during an annual
planning workshop with the management committee;

3.2.3 The Chairman of the Board shall be the Chief Executive Officer of the
subsidiary or attached authority who shall be responsible for ensuring
that the plans and programs shall be directed towards the attainment
of the corporate goals and objectives;

3.2.4 The Board shall appoint a Chief Operating Officer who shall be
responsible for the day-to-day operations of the subsidiary or authority;

3.2.5 A Chief Financial Officer shall be appointed to be responsible for


ensuring the efficient allocation and use of financial resources and
promoting financial discipline in the subsidiary or authority;

3.2.6 The Board shall create a management committee reporting directly


to the Chief Executive Officer which shall assist in planning and
monitoring overall corporate performance;

3.2.7 A Pay Plan and Position Classification shall be adopted which shall
include the job descriptions and position qualification standards.
Appointment to positions shall be based on merit, experience, and
fitness and must meet the minimum qualification standards prescribed
for the position being appointed to; and

3.2.8 The number of personnel shall be kept to a minimum to effect a lean,


efficient and professional organization.

3.3 Operations and Financial Policies. To promote efficient allocation and use
of government resources and to instill financial discipline in subsidiaries and
attached authorities, the BCDA hereby adopts the following operations and
financial policy guidelines:

21

3.3.1 The BCDA shall provide standard corporate planning models which
will give subsidiaries and attached authorities sufficient operational
flexibility. In the formulation of the corporate plans and programs, the
subsidiary or attached authority shall be guided by the performance
indicators and targets agreed upon with the BCDA;
Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 62

3.3.2 The BCDA shall establish with the concurrence of the attached
subsidiaries and authorities, performance criteria, standards and
targets and conduct periodic review and appraisal of performance
in accordance with such agreed criteria, performance indicators and
targets;

3.3.3 The governing Boards of subsidiaries and attached authorities are


authorized to enter into contracts involving not more than fifty
million pesos (P50M)

Unless otherwise provided, the governing Board shall determine


the levels of approving authority to be delegated to its corporate
officers.

The levels of authority on approval of government contracts


provided for in Executive Order No. 380 (November 27, 1989) or
other laws and regulations that may hereafter be promulgated shall
apply to contracts exceeding fifty million pesos (P50M);

3.3.4 The governing Boards of the subsidiaries or attached authorities shall


require its management to submit the following minimum required
financial reports:
Particulars

Submission Frequency

Statement of Monthly
Actual Financial
Operations

Monthly

3 Year Projection
of Annual Financial
Operations

Annually

Schedule of Monthly
Actual Net External and
Domestic Financing

Monthly

3 Year Projection
of Annual Capital
Expenditure Projects

Quarterly

Corporate Annual
Report Year

Annually

Laws on Bases Conversion

45th day after end of


reported month
June 30 of year
preceding the project
period
45th day after end of
reported month
June 30 of year
preceding the projected
period

Annually

Quarterly Financial
Statements

Submission Deadline

45th day after end of


reported quarter

June 30 of year
succeeding the
monitored year


22

BCDA RELATED LAWS - Executive Order No. 62

A copy of these financial reports shall also be submitted to the BCDA


to assist it in performing its oversight function;

3.3.5 Conversion projects must achieve specific objectives, must have


realistic and quantifiable targets, and time-bound;

3.3.6 A Performance Agreement shall be entered into by and between the


Chief Executive Officer of the subsidiary or attached authority with the
BCDA embodying the performance criteria and target for the year and
the desired goals of the succeeding years as worked out and agreed
upon by the subsidiary or authority and the BCDA; and

3.3.7 The BCDA shall conduct at least a semi-annual review of operations


of the subsidiary or attached authority in relation to established criteria
and agreed performance targets.

SECTION 4. PRIVATIZATION.The BCDA hereby adopts the following policy


guidelines in pursuing privatization, commercialization or divestment projects:
4.1 Privatization shall be the basic thrust of the conversion and development
of the baselands. Privatization modes shall include, among others, leasing,
joint ventures, management contract, build-operate-transfer (BOT) and its
variants;
4.2 Subsidiaries and attached authorities shall, unless specifically created for the
purpose, inhibit themselves from directly operating any business activity and
shall basically function as the overseer/administrator/regulatory body over
the baselands/facility they administered;
4.3 As a general rule, the privatization process should be conducted through
public bidding. However, in the exigency of public service and national
interest, and consonant with existing laws, rules and regulations on negotiated
contracts, simplified bidding through sealed canvass of at least three (3) prequalified investors, or direct negotiation, may be resorted to. The process of
selecting the prospective lessees and private investors shall be transparent,
where procedures and selection processes adapted are made public through
newspaper advertisements and similar other means;
4.4 Where necessary and justifiable, subsidiaries and attached authorities with
the approval of the BCDA, may establish subsidiaries and/or joint venture
firms to undertake specific business activities such as utilities and ports
which the private sector is reluctant to undertake or participate or when
public interest so dictates;

23

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 62

4.5 All negotiated privatization transactions, including leasing, joint venture or


sales, shall be in conformity with policies approved by the President of the
Philippines;
4.6 Prospective lessees, partners and third party principals shall be chosen
based on a selection criteria which shall consider experience, performance
track record, financial capability, good credit standing, technical expertise,
reputation and industry accreditation, among others. Minimum acceptable
selection standards shall be established by the governing Board of the
subsidiary or attached authority;
4.7 Subject to the provisions of applicable laws, rules and regulations, investment
bankers, financial advisors and technical consultants may be hired through
a short listing-bidding process to prepare and execute plans and programs
for fund generations, privatization or divestment of assets and facilities and
other investment and merchant banking requirements of the subsidiaries and
attached operating authorities;
4.8 All privatization agreements and contracts shall be signed by the Chief Executive
Officer upon being authorized by the Board;
4.9 Leasing of facilities by subsidiaries and attached authorities shall be governed
by the following guidelines:

4.9.1 As a general rule, lease agreements affecting baselands properties and


facilities shall be executed after a public bidding process. However, in
special cases, and consonant with existing laws, rules and regulations
on negotiated contracts, leasing may be done through sealed canvass
of at least three (3) prequalified potential lessees, or through direct
negotiation, in conformity with policies approved by the President of
the Philippines;

4.9.2 Lease agreements may be on short-term or long-term basis but not to


exceed 25 years subject to renewal for another 25 years;

4.9.3 The leasing procedures, standard rates, lease terms and conditions
shall be approved by the governing Board of the subsidiary or attached
authority; and

4.9.4 Unless otherwise authorized, lease contracts shall be signed by the


Chief Executive Officer representing the Board of Directors of the
subsidiary or attached authority.

SECTION 5. SECURITY ARRANGEMENTS.As a general rule, subsidiaries and


attached authorities should engage the services of private security agencies to secure the
Laws on Bases Conversion

24

BCDA RELATED LAWS - Executive Order No. 62

facilities and assets that are to be privatized and preserved. Organic security personnel
shall be retained only for the purpose of supervising and monitoring the activities of
contracted private security guards and to liaise with law enforcement authorities.
Heads of subsidiaries should secure the full assistance and participation of local
government units, government agencies, and non-government and peoples
organizations to preserve and protect the properties and natural resources within the
military reservations and extensions from damage and deterioration.
SECTION 6. ENVIRONMENT.A permanent total log ban shall be applied in all
military reservations and extensions which shall allow supervised cuttings to prevent
forest fires compatible with judicious management of the forest. These cuttings shall
require prior approval of the operating authority or subsidiary tasked to manage the
facility and/or area.
Environmental impact assessment studies shall be required of all major projects which
could affect the environment.
Environmental standards shall be strictly enforced by subsidiaries and attached
authorities in their respective areas of responsibility.
SECTION 7. DEPARTMENTS, BUREAUS, AGENCIES AND INSTRUMENTALITIES.
All heads of government departments, bureaus, offices, agencies and instrumentalities
are directed to facilitate the necessary approvals and assist the BCDA to expedite the
implementation of the various projects and activities of the conversion program.
SECTION 8. EFFECTIVITY.These implementing policies and guidelines shall take
effect immediately upon approval.
Done in the City of Manila, this 27th day of February in the year of Our Lord, Nineteen
Hundred and Ninety-Three.




(Sgd.) FIDEL V. RAMOS
President of the Philippines
By the President:

(Sgd.) ANTONIO T. CARPIO


Chief Presidential Legal Counsel

25

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7917

Republic Act No. 7917


An Act Amending
Section 8 of Republic Act Numbered Seventy-Two Hundred and Twenty-Seven,
Otherwise Known as the Bases Conversion and Development Act of 1992,
Providing for the Distribution of Proceeds From the Sale of Portions of
Metro Manila Military Camps, and for Other Purposes
Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:
SECTION 1. Paragraph (d), Section 8 of Republic Act No. 7227, otherwise known as
the Bases Conversion and Development Act of 1992, is hereby amended to read as
follows:
(d) A proposed 30.15 hectares as relocation site for families to be affected by
circumferential road 5 and radial road 4 construction: Provided, further, That
the boundaries and technical descriptions of these exempt areas shall be
determined by an actual ground survey.

The President is hereby authorized to sell the above lands, in whole or in part,
which are hereby declared alienable and disposable, pursuant to the provisions
of existing laws and regulations governing sales of government properties:
Provided, That no sale or disposition of such lands will be undertaken until a
development plan embodying projects for conversion shall be approved by the
President in accordance with paragraph (b), Section 4, of this Act. However, six
(6) months after approval of this Act, the President shall authorize the Conversion
Authority to dispose of certain areas in Fort Bonifacio and Villamor as the latter
so determines. The Conversion Authority shall provide the President a report
on any such disposition or plan for disposition within one (1) month from
such disposition or preparation of such plan. The proceeds from any sale, after
deducting all expenses related to the sale, of portions of Metro Manila military
camps as authorized under this Act, shall be deemed appropriated for the
purposes herein provided for the following purposes with their corresponding
percent shares of proceeds:
(1)

Thirty five percent (35%) - To primarily finance the self-reliance and


modernization program of the AFP, the transfer of the AFP military
camps and the construction of new camps and the rehabilitation and
expansion of the AFPs medical facilities and the modernization of the
government arsenal;

(2)

Twenty-seven and a half percent (27.5%) - To finance the construction


and upgrading of infrastructure such as highways, railways and
other transport facilities to make Subic-Clark and other former bases

Laws on Bases Conversion

26

BCDA RELATED LAWS - Republic Act No. 7917

accessible: Provided, That other public works, utilities and irrigation


projects not specified herein shall be included: Provided, further, That
the conversion into commercial uses of the former military baselands
proper and their extensions shall be undertaken as much as practicable
through the Build-Operate-Transfer (BOT) scheme or financed by locator
enterprises: Provided, finally, That this appropriation shall be retained
by the Conversion Authority as part of its paid-up capital, pursuant to
Section 6 of this Act;
(3)

Twelve percent (12%) - To finance the National Shelter Program:


Provided, That fifty percent (50%) thereof, shall be used to finance mass
social housing project for the underprivileged and homeless citizens of
the country and the other fifty percent (50%) to concessional and longterm housing loan assistance for the homeless of Metro Manila, Olongapo
City, Angeles City and other affected municipalities contiguous to the
base areas;

(4)

Three percent (3%) - To finance the National Health Insurance Program;

(5) Five percent (5%) - To finance critical infrastructure projects not covered
by the Build-Operate-Transfer (BOT) program in areas surrounding the
former baselands;
(6)

Two percent (2%) - To finance the benefits/claims of Military War


Veterans and their dependents under Republic Act No. 7696;

(7) One percent (1%) - As contribution for the Higher Education Development
Fund under Section 10 of Republic Act No. 7722, otherwise known as
the Higher Education Act of 1994, the amount of Five hundred million
pesos (P500,000,000.00) or so much thereof, and the balance to finance
students scholarship, faculty development, and the improvement of
physical plants of colleges and universities under the Commission on
Higher Education (CHED);
(8)

27

Two percent (2%) - To finance the science and technology scholarships


and training of thousands of young Filipino scientists and students in
selected countries to be identified by the Department of Science and
Technology; and the Study Now Pay Later Program for poor but deserving
youths who shall enroll or are enrolled in science and technology (S
& T) courses which will propel the country to achieve modernization
and competitive excellence in the 21st century: Provided, That at
least one (1) scholar/trainee shall be selected from each municipality/
city of the country: Provided, further, That they shall render service to
the Government for at least three (3) years or shall engage in S & T
entrepreneurial activities within the country;

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7917

(9)

One percent (1%) - To finance the multi-year program of the prosecution


service;

(10) Two percent (2%), but in no case exceeding Two billion pesos
(P2,000,000,000.00) - To finance a multi-year modernization program
of the National Bureau of Investigation (NBI), the Philippine National
Police (PNP) and improvement of prison facilities.

Provided, That seventy percent (70%) of this appropriations shall be


used for capital outlay and thirty percent (30%) for training programs
and early retirement schemes for their officers and personnel;

(11) One percent (1%), but in no case to exceed One billion pesos
(1,000,000,000) - To finance a multi-year judicial reform program;
(12) Two percent (2%) - To finance the establishment of pre-school and
daycare centers nationwide;
(13) One-half percent (1/2%) but not to exceed Five hundred million pesos
(P500,000,000.00) - For the summer program for the education of
students (SPES) in accordance with Republic Act No. 7323;
(14) One percent (1%) - For the construction of Senior Citizens Centers as
provided under Republic Act No. 7876;
(15) Three percent (3%) - To the emergency and contingent needs of the
areas devastated by the Mount Pinatubo eruptions;
(16) Two percent (2%) - For infrastructure development of future special
economic zones to be created;

Approximately forty hectares (40 has.) of land in Fort Bonifacio, Phase I,


shall be retained as national government and local government centers,
sports facilities and parks: Provided, That in the case of Fort Bonifacio,
two and five tenths percent (2.5%) of the proceeds thereof in equal
shares shall each go to Municipalities of Makati, Taguig and Pateros:
Provided, further, That in no case shall farmers affected be denied due
compensation.

The provisions of law to the contrary notwithstanding, the proceeds of


the sale thereof shall not be diminished and, therefore, exempt from all
forms of taxes and fees.

SECTION 2. The President of the Philippines is hereby authorized to sell other portions
of lands in military camps in Metro Manila and in Clark and Subic and other former
baselands and other unused portions of existing military reservations, in whole or in
Laws on Bases Conversion

28

BCDA RELATED LAWS - Republic Act No. 7917

part, which are hereby declared alienable and disposable, pursuant to the provisions
of existing laws and regulations governing sales of government properties: Provided,
That no sale or disposition of such lands will be undertaken until a development plan
embodying projects for conversion by the Conversion Authority or the Subic Authority
shall be approved by Congress.
SECTION 3. Other provisions of the Republic Act No. 7227, otherwise known as
the Bases Conversion and Development Act of 1992, which are not affected by the
provisions of Section 8 hereof, shall remain in force and effect.
SECTION 4. RULES AND REGULATIONS.The President of the Philippines
shall promulgate such rules and regulations as may be necessary for the proper
implementation of this Act.
SECTION 5. SEPARABILITY CLAUSE.If any of the provisions of this Act is declared
invalid, the remainder of this Act or any provision not affected thereby shall remain in
force and effect.
SECTION 6. REPEALING CLAUSE.All laws, decrees, ordinances, rules and regulations,
executive or administrative orders, and other presidential issuances inconsistent with
this Act, are hereby repealed, amended or modified accordingly.
SECTION 7. EFFECTIVITY.This Act shall take effect after fifteen (15) days following
its publication in at least two (2) newspapers of general circulation.

Approved,

(Sgd.) JOSE DE VENECIA, JR.


Speaker of the
House of Representatives

29

(Sgd.) EDGARDO J. ANGARA


President of the Senate

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 7917

This Act, which is a consolidation of Senate Bill No. 2066 and House Bill No. 14604,
was finally passed by the Senate and the House of Representatives on February 21,
1995.

(Sgd.) CAMILO L. SABIO


Secretary General
House of Representatives

(Sgd.)EDGARDO E. TUMANGAN
Secretary of the Senate

Approved: February 24, 1995



(Sgd.) FIDEL V. RAMOS
President of the Philippines

Laws on Bases Conversion

30

BCDA RELATED LAWS - Administrative Order No. 236

Administrative Order No. 236


Prescribing Rules and Regulations on the Collection, Remittance
and Utilization of Sales Proceeds Under Republic Act No. 7227
as Amended by Republic Act No. 7917
1. Purpose
This Order is issued to prescribe the rules and regulations covering
the collection, remittance and utilization of proceeds from the sale of
government lands and other properties transferred to the Bases Conversion
Development Authority pursuant to RA No. 7227 as amended by RA No. 7917.
2. Coverage
This Order covers the Bases Conversion Development Authority (BCDA) and all
agencies, national, local or government corporation, designated as beneficiaries,
implementors or conduits, hereafter referred to as agencies, of the proceeds of the
sale of government lands and other properties in accordance with the provisions
of RA No. 7227 as amended by RA No. 7917.
3. General Guidelines
3.1 Pursuant to the one fund concept in government budgeting and accounting,
consistent with the provisions of Section 29 (1) of Article VI and Section 22 of
Article VII of the Constitution, as implemented by Sections 44 and 45, Book VI
of EO No. 292 and Sections 65 and 66 of the Government Auditing Code, all
income, fees, charges, assessments, and other receipts or revenues collected
by government offices and agencies shall be deposited in the National Treasury
and shall accrue to the General Fund of the National Government.
3.2 Section 1 of RA 7917 provides that The proceeds from any sale, after deducting
all expenses related to the sale, of portions of Metro Manila military camps
as authorized under this Act, shall be deemed appropriated for the purposes
herein provided. This means that the funds are automatically appropriated
and their utilization shall be in accordance with the purposes enumerated
therein, subject however, to budget programming based on the approved
government fiscal program for the year.
4. Specific Guidelines
4.1 The proceeds from the sale of government lands and other properties pursuant
to Section 8 of RA 7227 as amended by RA 7917 are hereby declared
government funds and shall be remitted to the National Treasury and shall
accrue to the General Fund of the government.

31

Laws on Bases Conversion

BCDA RELATED LAWS - Administrative Order No. 236

4.1.1 The treatment and deposit of interest earnings from the proceeds of
sale of government lands and other properties transferred to BCDA
pursuant to R.A. No. 7227, as amended by R.A. No. 7917, shall be
determined by the Committee created under paragraph 4.2 hereof in
consultation with the Bureau of the Treasury and the Commission on
Audit.
4.2 BCDA shall remit to the National Treasury, the proceeds from the sale, net of the
expenses directly incurred in the sale of the land or property, within two weeks
after receipt of actual payment from the buyer. The direct expenses incurred
shall pertain to those expenses that are directly attributable to the sale of the
land or property such as the appraisal/valuation of the properties, marketing
expenses and relocation/replication costs or those which would not have been
incurred by BCDA and AFP if the decision to sell were not made, with the
latter to be determined jointly by a Committee herein created composed of
representatives from the Bases Conversion Development Authority (BCDA),
Department of National Defense (DND) and Department of Finance (DOF).
4.3 In accordance with Section 1 of RA 7917, 2.5% of the sales proceeds of Fort
Bonifacio, net of the direct expenses defined in the preceding section, shall be
deducted to cover the share to be divided equally among the City of Makati
and the Municipalities of Taguig and Pateros. The Bureau of the Treasury
shall establish a separate Special Account for the Department of Budget and
Management which shall act as conduit and administrator of the fund intended
for the City of Makati and the Municipalities of Taguig and Pateros.
4.4 The Purposes enumerated in RA 7917 shall be interpreted as follows:
4.4.1 The Modernization Program referred to under Section 1 (1) shall
include not only the modernization program of the Armed Forces of
the Philippines but also the modernization program of the Government
Arsenal as determined by the Secretary of National Defense;
4.4.2 Section 1 (3) shall mean the National Shelter Program as implemented
by the National Housing Authority, National Home Mortgage Finance
Corporation and Home Insurance Guaranty Corporation as endorsed
by the Housing and Urban Development Coordinating Council;
4.4.3 Section 1 (5) shall mean critical infrastructure projects for areas
surrounding the former bases as recommended by the BCDA and
forwarded to the Department of Public Works and Highways (DPWH)
and Department of Transportation and Communications (DOTC) for
implementation;

Laws on Bases Conversion

32

BCDA RELATED LAWS - Administrative Order No. 236

4.4.4 Section 1 (9) shall mean the multi-year program of the prosecution
service being implemented by the Office of the Secretary of the
Department of Justice (DOJ) and the Ombudsman;
4.4.5 Section 1 (10) shall mean the improvement of prison facilities
undertaken by the Bureau of Jail Management and Penology and the
Bureau of Corrections;
4.4.6 Section 1 (11) shall mean the judicial reform programs of the Judiciary;
4.4.7 Section 1 (12) shall mean the pre-school program of the Department
of Education, Culture and Sports (DECS) and day care centers as
determined by the Department of Social Welfare and Development
(DSWD);
4.4.8 Section 1 (14) shall mean the construction of Senior Citizens Centers
as determined by the DSWD; and
4.4.9 Section 1 (15) shall mean programs and projects to meet emergency
and contingent needs of the areas devastated by the Mount Pinatubo
eruptions as determined by the Mt. Pinatubo Commission for
implementation by the appropriate agencies.
4.5 The Bureau of the Treasury shall record the net proceeds, i.e., after deducting
the expenses and shares stipulated in Section 4.2 and Section 4.3, respectively,
separately as a Special Account in the General Fund. For this purpose, a
separate Special Account shall be established for each of the individual
agencies, as follows:
4.5.1 35% for the account of the Armed Forces of the Philippines and the
Government Arsenal;
4.5.2 27.5% for the account of the Bases Conversion Development Authority;
4.5.3 12% for the account of the National Housing Authority, National Home
Mortgage Finance Corporation and Home Insurance and Guaranty
Corporation;
4.5.4 3% for the account of the Philippine Health Insurance Corporation;
4.5.5 5% for the account of the Department of Public Works and Highways
and Department of Transportation and Communications;
4.5.6 2% for the account of the Philippine Veterans Affairs Office;

33

Laws on Bases Conversion

BCDA RELATED LAWS - Administrative Order No. 236

4.5.7 1 % for the account of the Commission on Higher Education;


4.5.8 2% for the account of the Department of Science and Technology;
4.5.9 1% for the account of the Office of the Secretary, Department of Justice
and the Ombudsman;
4.5.10 2%, but not to exceed two billion pesos, for the account of the National
Bureau of Investigation, Bureau of Corrections, Philippine National
Police, and the Bureau of Jail Management and Penology;
4.5.11 1%, but not to exceed one billion pesos, for the account of the Supreme
Court of the Philippines and the Lower Courts, Sandiganbayan, Court
of Appeals and Court of Tax Appeals;
4.5.12 2% for the account of the Department of Education, Culture and Sports
and Department of Social Welfare and Development;
4.5.13 1/2%, but not to exceed five hundred million pesos, for the account of
the Department of Labor and Employment;
4.5.14 1% for the account of the Department of Social Welfare and
Development;
4.5.15 3% for the account of the Mount Pinatubo Assistance, Rehabilitation
and Development Fund; and
4.5.16 2% for the account of the Philippine Economic Zone Authority.
4.6 The individual Special Accounts shall be utilized exclusively for the purposes
for which they have been established as prescribed under Section 8 of RA
7227 as amended by RA 7917. The DBM shall program the annual utilization
of the proceeds of sales consistent with the approved fiscal program of the
government and shall release the share of each of the beneficiary agencies in
accordance with specific budget execution guidelines.
4.6.1 In the case of the Special Accounts created for two or more Departments
or agencies but no specific allocation for each of the agencies is
provided under RA 7917, as mentioned in Section 4.5, utilization of
the same shall be contained in a Memorandum of Agreement between
the departments and agencies concerned.
4.6.2 The utilization of the Special Account created for the Mount Pinatubo
Assistance, Rehabilitation and Development Fund referred to in
paragraph 4.5.15 shall be subject to the approval of the Mt. Pinatubo
Laws on Bases Conversion

34

BCDA RELATED LAWS - Administrative Order No. 236

Commission, however, the funds for the projects may be released


directly to the implementing agencies.
4.6.3 In the case of the sale of a portion of Fort Bonifacio, BCDA may be
reimbursed an amount to defray its obligation incurred prior to the
enactment of RA 7917, for housing construction to relocate the
squatters which shall be charged against the 12% share of the National
Shelter Program but shall in no case exceed 50% of the said share.
4.6.4 In cases where there have been releases made from the proceeds
of the sale of Fort Bonifacio to departments by way of Presidential
Directive prior to the issuance of this IRR, such released amount shall
be considered/treated as advance releases. Such amount shall be
reimbursed from whatever share the said department may have from
their respective allocation out of such proceeds.
4.7 The Special Accounts herein established shall be considered as sources
of funding for the purposes enumerated in RA 7917 and not as additional
appropriations to other appropriation sources intended for purposes similar to
those enumerated in the same Act. However, for CY 1995, in cases where an
appropriation for the purposes enumerated in RA 7917 has been provided under
the General Appropriations Act, said appropriation shall first be obligated prior
to the release of funds against the special account except if the appropriation
in the GAA refers to a regular program of the department/agency.
4.8 All expenditures chargeable against the individual Special Accounts shall be
included in the program of expenditures of the national government and the
local government units concerned. However, the appropriations will not be
reflected in the General Appropriations Act. For this purpose, all agencies
shall prepare and submit to the Department of Budget and Management, a
request and such other documents as may be required detailing the items of
expenditures. This request shall include both the quarterly obligation and cash
program requirements of the beneficiary agency.
4.9 Beginning 1996, all expenditures shall be included in the over-all expenditure
program of the agency concerned following the regular budgetary process.
Proposed programs and projects to be funded under RA 7917 shall be evaluated
against the overall requirements of the agency.
4.10 All agencies shall submit periodic reports to the Office of the President, copy
furnished the Department of Budget and Management and the Department of
Finance on the status of funds utilization in accordance with the provisions of
DBM Circular Letter No. 92-6 dated June 27, 1992.

35

Laws on Bases Conversion

BCDA RELATED LAWS - Administrative Order No. 236

5. Effectivity
This Order shall take effect fifteen (15) days following publication in two (2) newspapers
of general circulation.
DONE in the City of Manila, this 8th day of January in the year of Our Lord, Nineteen
Hundred and Ninety-Six.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:

(Sgd.) RUBEN D. TORRES


Executive Secretary

Laws on Bases Conversion

36

BCDA RELATED LAWS - Executive Order No. 429

Executive Order No. 429


Amending Executive Order No. 62, Series of 1993, which Prescribed
the Policies and Guidelines to Implement Republic Act No. 7227
WHEREAS, Executive Order No. 62, series of 1993, was issued prescribing the policies
and guidelines to implement Republic Act No. 7227, otherwise known as the Bases
Conversion and Development Act of 1992;
WHEREAS, Section 4.9.2 of the said executive order fixes the lease period of baseland
properties to 25 years subject to renewal for another 25 years;
WHEREAS, Section 4 of Republic Act No. 7652, otherwise known as Investors Lease
Act, allows foreign investors investing in the Philippines to lease private lands for the
establishment of industrial estates, factories, assembly or processing plants, agro-industrial enterprises, land development for industrial, or commercial use, tourism, and
other similar priority productive endeavors for a period not exceeding fifty (50) years,
renewable once for not more than twenty-five (25) years;
WHEREAS, Section 1 (d) of the rules implementing RA 7652 defines private lands as
those including patrimonial properties of the state owned, held, controlled, supervised
or managed by government owned or controlled corporations such as but not limited to the Export Processing Zone Authority, the Phividec Industrial Authority and the
Bases Conversion arms, such as Clark Development Corporation (CDC) and the Subic
Bay Metropolitan Authority;
WHEREAS, there is a need to amend Section 4.9.2 of Executive Order 62 in order to
grant Filipino investors the same privilege given to foreign locators investing in properties being held, managed or administered by the BCDA, SBMA, CDC and any of its
subsidiaries;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines,
by virtue of the powers vested in me by law, and upon the recommendation of the
Chairmen of the BCDA and the CDC, do hereby order:
Section 1. Amendment of Lease Period.Section 4.9.2 of EO 62, series 1993, is hereby amended to read as follows:
4.9.2. Lease agreements may be on short-term or long-term basis but not to exceed fifty
(50) years, renewable once for not more than twenty-five (25) years, for local investors
establishing industrial estates, factories, assembly or processing plants, agro-industrial
enterprises, land development for industrial, or commercial use, tourism, and other
similar priority productive endeavors;

37

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 429

The twenty-five year lease period, renewable once for another twenty-five (25) years,
shall continue to operate for investments not included in the foregoing enumeration.
Sec. 2. Repealing Clause.Any and all orders, rules and regulations or parts thereof
inconsistent herewith are hereby amended, modified or repealed accordingly.
Sec. 3. Effectivity.This Executive Order shall take effect immediately.
DONE in the City of Manila, this 28th day of July in the year of Our Lord, Nineteen
Hundred and Ninety-Seven.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:

(Sgd.) ANTONIO T. CARPIO


Chief Presidential Legal Counsel

Laws on Bases Conversion

38

BCDA RELATED LAWS - Executive Order No. 309

Executive Order No. 309


Prescribing Guidelines, Rules and Regulatons for the Distribution of Proceeds
of Leases, Joint Ventures and Transactions Other Than Sale Involving Portions
of Metro Manila Military Camps Under Republic Act No. 7227, as Amended by
Republic Act No. 7917
WHEREAS, Section 8 of Republic Act No. 7227, as amended by Republic Act No.
7917, authorizes the President to sell certain Metro Manila Camps, including Fort
Bonifacio and Villamor Air Base, in whole or in part, in accordance with the provisions
of existing laws and regulations governing sales of government properties;
WHEREAS, Republic Act No. 7227, as amended by Republic Act No. 7917,
contemplates a situation where the lands that were transferred to the Bases Conversion
Development Authority (BCDA) for the purpose of disposing the same could be sold at
rates beneficial to the government;
WHEREAS, the present depressed state of the countrys real estate market, influenced
by both global and domestic economic factors, renders the outright sale of the military
camps disadvantageous to the government;
WHEREAS, BCDA, through the exercise of sound business judgment pursuant to its
mandate, has deemed it more beneficial to the interests of the government to enter into
commercial transactions other than sale involving certain portions of Metro Manila
military camps instead of selling them;
WHEREAS, BCDA is under the direct control and supervision of the Office of the
President for purposes of policy direction and coordination;
NOW, THEREFORE, I, JOSEPH EJERCITO ESTRADA, President of the Philippines, by
virtue of the powers vested in me by law, do hereby order:
Section 1. Distribution of Proceeds of Leases, Joint Ventures and Transactions Other
Than Sale Proceeds of leases, joint ventures and all transactions other than sale
entered into by the Bases Conversion Development Authority (BCDA) involving
portions of Metro Manila military camps shall be distributed equally between BCDA
and the Armed Forces of the Philippines (AFP).
Section 2. Coverage This Executive Order shall cover the proceeds of all transactions
mentioned in the preceding Section, including those previously executed.
Section 3. Basis of Sharing The distribution shall be based on the proceeds of the
transaction, net of the expenses directly incurred for said transaction. Direct expenses
refers to those expenses directly attributable to the transaction that would not have
been incurred by BCDA and AFP if the decision to enter into such transaction were not

39

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 309

made. Such expenses shall be jointly determined by representatives of BCDA and the
Department of National Defense (DND).
Section 4. Utilization of Proceeds The share of the BCDA from the proceeds of the
transactions contemplated in Section 1 shall be considered its corporate income the
utilization of which shall be determined by the Board of Directors of BCDA. For its
part, the share of the AFP shall be utilized for the AFP Modernization Program under
Republic Act No. 7898: Provided, That proceeds received after the termination of
the AFP Modernization Program may still be used to satisfy multi-year obligations
incurred pursuant to such Program: Provided, further, That thereafter, AFPs share may
be utilized for other modernization projects as may be determined by the AFP and
approved by the Secretary of National Defense.
Section 5. Remittance of AFPs Share Within two (2) weeks after receipt of actual
payment from the other transacting party, BCDA shall remit AFPs share directly to
the Armed Forces of the Philippines Modernization Act Trust Fund (Fund 172) in the
Bureau of the Treasury.
Section 6. Effectivity This Executive Order takes effect immediately.

DONE in the City of Manila this 3rd day of November in the year of Our Lord, Two
Thousand.

(Sgd.) JOSEPH EJERCITO ESTRADA


President of the Philippines
By the President:

(Sgd.) RONALDO B. ZAMORA


Executive Secretary

Laws on Bases Conversion

40

BCDA RELATED LAWS - Executive Order No. 70

Executive Order No. 70


Declaring Portions of the Property of the Bases Conversion
Development Authority Located in Fort Bonifacio and Its Environs
as Socialized Housing Sites and Providing for the Disposition thereof
to Qualified Occupants and Beneficiaries
WHEREAS, in line with the priority concern of the present Administration to provide lands
to deserving landless and homeless Filipinos, the President has issued a memorandum
dated 05 February 2001, directing all heads of Government Departments, Agencies,
Government-Owned and Controlled Corporations and their Instrumentalities to
identify areas which may be identified for socialized housing purposes;
WHEREAS, said Memorandum is in accordance with the policy of the present
Administration of regularizing the land tenurial status of informal settlers occupying
public lands;
WHEREAS, the Bases Conversion Development Authority (BCDA),
corporation created under Republic Act No. 7227, accelerated the
the military reservations into other productive uses, and pursuant to
was given the authority to dispose of these military camp to provide
development and conversion to productive civilian use;

a government
conversion of
the same law,
funds for their

WHEREAS, Republic Act No. 7227, transferred to BCDA the ownership, administration
and control of a substantial portion of Fort Bonifacio consisting of 723.3 hectares;
WHEREAS, a portion of the Fort Bonifacio property consisting of 119 hectares has been
designated as the Bonifacio Housing and Information Technology Zone (BHIT Zone)
pursuant to the Master Development Plan for the area which was updated pursuant to
A.O. No. 25, series of 1998;
WHEREAS, portions of the said BHIT Zone are currently occupied by informal dwellers;
WHEREAS, another portion of the Fort Bonifacio property identified as Lupang
Katuparan covering an area of approximately 48 hectares is currently being developed
as land-based housing site to accommodate the families to be affected by BCDA
Projects;
WHEREAS, the Pamayanang Diego Silang area located along the C-5 Road with a total
of 2,880 units in 5-storey medium rise buildings spread out over 23.86 hectares was
developed for socialized housing purposes primarily to accommodate the families to
be affected by BCDA Project as well as military, BCDA and PNP/DILG/NAPOLCOM
personnel;

41

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 70

WHEREAS, the area known as Philippine Centennial Village located along the C-5
Road with a total of 1,140 units in 5-storey medium rise buildings covering 13.08
hectares was developed for socialized housing purposes primarily to accommodate
the families to be affected by BCDA Projects.
WHEREAS, the BCDA as contained in its Board Resolution No. 2002-01-011 has
signified its approval to dispose of approximately 35 hectares of occupied portions
of the BHIT Zone, Pamayanang Diego Silang covering 13.08 hectares, including
2,880 residential units in medium rise buildings, Philippine Village Centennial Village
covering 23.86 hectares including 1,140 residential units in medium rise buildings,
and approximately 48 hectares at Lupang Katuparan, to qualified occupants and
beneficiaries.
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Philippines,
by virtue of the powers vested in me by law, do hereby order:
Section 1. Declaration as Socialized Housing Sites. In view of the need of informal
settlers to acquire home ownership and shelter security, the following portions of
BCDAs property located in Fort Bonifacio and its environs are hereby declared as
socialized housing sites open for disposition to qualified occupants and beneficiaries:

a)

A portion of the BHIT Zone Property 35.00 hectares

b)

Lupang Katuparan

c)

Pamayanang Diego Silang

d)

Philippine Centennial Village










Total

48.00 hectares

23.86 hectares
13.08 hectares

119.94 hectares

This declaration shall include in the case of Pamayanang Diego Silang, 2,880 residential
units in 5-storey medium rise buildings found therein, and, in the case of Philippine
Centennial Village, 1,140 residential units in 5-storey medium rise buildings therein.
The actual metes and bounds of the foregoing properties covered by this Order shall,
as necessary, be subject to final survey.
Sec. 2. Implementation by Housing and Urban Development Coordinating Council
(HUDCC).The implementation of this Order shall be the responsibility of HUDCC
as lead agency. In this connection, BCDA shall ensure the smooth turnover of the
administration and control of the above-identified areas subject of this Order to
HUDCC for this purpose.

Laws on Bases Conversion

42

BCDA RELATED LAWS - Executive Order No. 70

Sec. 3. Executive Committee.An Executive Committee shall be created to assist


HUDCC in implementing this Order. This committee shall be composed of HUDCC as
Chair, and the following as members: BCDA, Department of Environment and Natural
Resources (DENR), Presidential Commission for the Urban Poor (PCUP), Department
of National Defense/Armed Forces of the Philippines (DND/AFP) in so far as military
personnel residing in the areas covered, the Municipal Government of Taguig, and the
Congressional Representative of Taguig.
The Executive Committee shall, among others, ensure that the actual metes and
bounds of the properties covered by this Order are established through final survey,
as necessary, and that the qualifications and identification of beneficiaries, beneficiary
guidelines, and a fair lot/unit pricing and payment scheme, are established and
implemented. The Committee shall take into consideration existing agreements with
the different peoples organizations in the area.
Sec. 4. Funding.The Executive Committee shall formulate a budget to implement
this Order taking into account the funding requirements for the various activities
(social preparation, census and tagging, ground survey, mobilization, etc.) that must be
undertaken in connection hereof. The Department of Budget and Management shall
ensure the provision of the funding requirements of the Executive Committee.
Sec. 5. Separability Clause.In the event that any provision hereof is declared invalid
by any competent court or tribunal, the other provisions hereof unaffected thereby
shall remain in full force and effect.
Sec. 6. Effectivity.This Executive Order shall take effect immediately.
DONE in the City of Manila, this 11th day of February, in the year of Our Lord, Two
Thousand and Two.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) ALBERTO G. ROMULO


Executive Secretary

43

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 116

Executive Order No. 116


Declaring Portions of the Property of the Bases Conversion Development Authority
(BCDA) Property, namely, Camp Claudio and Camp Atienza Situated in Paraaque
City and Quezon City Respectively, as Socialized Housing Sites and Providing for,
the Disposition Thereof to Qualified Occupants and Beneficiaries
WHEREAS, in line with the priority concern of the present Administration to provide
lands to deserving landless and homeless Filipinos, the President has issued a
memorandum dated 05 February 2001, directing all heads of the Government
Departments, Agencies, Government-Owned and Controlled Corporations and their
Instrumentalities to identify areas which may be identified for socialized housing
purposes;
WHEREAS, said Memorandum is in accordance with the policy of the present
Administration of regularizing the land tenurial status of informal settlers occupying
public lands;
WHEREAS, the Bases Conversion Development Authority (BCDA),
corporation created under Republic Act No. 7227, accelerated the
the military reservations into other productive uses, and pursuant to
was given the authority to dispose of these military camp to provide
development and conversion to productive civilian use;

a government
conversion of
the same law,
funds for their

WHEREAS, Republic Act No. 7227, transferred to BCDA the ownership, administration
and control of a substantial number of military reservations which include among
others, Camps Claudio and Atienza, situated in Tambo, Paraaque City and Libis,
Quezon City, respectively.
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Philippines,
by virtue of the powers vested in me by law, do hereby order:
Section 1. Declaration of Socialized Housing Sites. In view of the need of the
informal settlers to acquire home ownership and shelter security, the following portions
of BCDAs property located in Tambo, Paraaque City and Libis, Quezon City are
hereby declared as socialized housing sites open for disposition to qualified occupants
and beneficiaries:
a) Portion of Camp Claudio 1.000 hectare
b) Portion of Camp Atienza 0.534 hectare
The actual metes and bounds of the foregoing properties covered by this Office shall,
as necessary, be subject to final survey.

Laws on Bases Conversion

44

BCDA RELATED LAWS - Executive Order No. 116

Sec. 2. Implementation by the Housing and Urban Development Coordinating


Council (HUDCC).The implementation of this Order shall be the responsibility of
HUDCC as lead agency. In this connection, BCDA shall ensure the smooth turnover
of the administration and control of the above-identified area subject of this Order to
HUDCC for this purpose.
Sec. 3. Executive Committee.An Executive Committee shall be created to assist
HUDCC in implementing this Order. This committee shall be composed of HUDCC as
Chair, and the following as members: BCDA, Department of Environment and Natural
Resources (DENR), Presidential Commission for the Urban Poor (PCUP), Department
of National Defense/Armed Forces of the Philippines (DND/AFP) in so far as military
personnel residing in the areas covered, the Municipal Government and Congressional
Representative of the respective locality.
The Executive Committee shall, among others, ensure that the actual metes and bounds
of the properties covered by this Order are established through final survey, as necessary,
and that the qualifications and identification of beneficiaries, and a fair lot/unit pricing
and payment scheme, are established and implemented. The Committee shall take
into consideration existing agreements with the different peoples organizations in the
area.
Sec. 4. Funding.The Executive Committee shall formulate a budget to implement
this Order taking into account the funding requirements for the various activities
(social preparation, census and tagging, ground survey, mobilization, etc.) that must be
undertaken in connection hereof. The Department of Budget and Management shall
ensure the provision of the funding requirements of the Executive Committee.
Sec. 5. Separability Clause.In the event that any provision hereof is declared invalid
by any competent court or tribunal, the other provisions hereof unaffected thereby
shall remain in full force and effect.
Sec. 6. Effectivity.This Executive Order shall take effect immediately.
Done in the City of Manila, this 15th day of August, in the year of Our Lord, Two
Thousand and Two.
(Sgd.) GLORIA MACAPAGALARROYO
President of the Philippines
By the President:
(Sgd.) ALBERTO G. ROMULO
Executive Secretary

45

Laws on Bases Conversion

BCDA RELATED LAWS - Proclamation No. 359

Proclamation No. 359


Withdrawing from Use for Military Purposes a Portion of the Parcel of Land
known as Camp Claudio, Situated in Tambo, Paraaque City,
and Reserving the Same for Housing and Urban Development Purposes
WHEREAS, President Manuel L. Quezon issued Proclamation No. 94 dated October
14, 1936 reserving for military purposes a parcel of land of the public domain,
otherwise known as Camp Claudio, situated in Tambo, Paraaque City, consisting of
5.4112 hectares, as follows:

Upon the recommendation of the Secretary of Agriculture and Commerce
and pursuant to the provisions of section sixty-four of Act Numbered Twenty-seven
hundred and eleven, as amended, I hereby withdraw from sale or settlement and reserve
for military purposes, under the administration of the Chief of Staff, Philippine Army,
the following-described parcel of land, situated in the barrio of Tambo, municipality
of Paraaque, Province of Rizal, Island of Luzon, and particularly described in Bureau
of Lands plan Swo-14653, to wit:

Beginning at a point marked 1 on Bureau of Lands plan Swo-14653, N. 7 11
E. 1,874.37 m. more or less, from B. L. L. M. No. 1, municipality of Paraaque, thence
N. 2 47 E. 33.69 m. to point 2; S. 82 59 E. 121.93 m. to point 3; S. 9 10 W. 239.44
m. to point 4; S. 81 39 E. 150.70 m. to point 5; S. 10 22 W. 15.00 m. to point 6;
N. 81 30 W. 150.40 m. to point 7; S. 9 10 W. 21.20 m. to point 8; N. 81 44 W.
104.25 m. to point 9; N. 7 19 E. 429.05 m. to point 1, point of beginning.

Containing an area of 54,112 square meters.

WHEREAS, the Armed Forces of the Philippines (AFP), particularly the Philippine
Navy (PN), occupied Camp Claudio and used the same for housing purposes for its
personnel;
WHEREAS, Republic Act (RA) No. 7227, otherwise known as the Bases Conversion
and Development Act of 1992, authorized the sale of two (2) hectares of Camp
Claudio, with the remaining 3.4112 hectares of Camp Claudio still reserved for
military purposes;
WHEREAS, out of the two (2) hectares which had been authorized for sale and
transferred to the Bases Conversion and Development Authority (BCDA) pursuant to
RA No. 7227, one (1) hectare was declared as a socialized housing site and authorized
for disposition to qualified occupants and beneficiaries by virtue of Executive Order
No. 116 dated August 15, 2002;
WHEREAS, the Office of the Vice President (OVP), the Department of Foreign
Affairs (DFA), the Department of National Defense (DND), and the Housing and

Laws on Bases Conversion

46

BCDA RELATED LAWS - Proclamation No. 359

Urban Development Coordinating Council (HUDCC) entered into a Memorandum of


Understanding dated June 4, 2002 which reads:
WHEREAS, Presidential Proclamation No. 94, dated October 14, 1936, reserved
for military purposes a parcel of land in the Municipality, now City, of Paraaque
containing an area of about 5.4112 hectares as particularly described in Bureau of
Lands SWO-14653;
WHEREAS, the Armed Forces of the Philippines, particularly the Philippine Navy
established in this parcel of land Camp Claudio and is currently being utilized for
housing purposes of its personnel;
WHEREAS, Republic Act No. 7227 transfered 2.0 hectares of Camp Claudio to the
Bases Conversion Development Authority (BCDA) for disposition, leaving 3.4112 of
the said Camp still reserved for military purposes;
WHEREAS, BCDA, in its letter of 29 January 2002 to HUDCC, approved the use of its
property in Camp Claudio for socialized housing;
WHEREAS, OVP, in cooperation with the DFA, in its economic empowerment program
for migrant workers, is promoting housing for Overseas Filipino Workers;
WHEREAS, OVP desires to provide affordable housing for its personnel;
WHEREAS, DFA desires to provide affordable housing for its personnel;
WHEREAS, HUDCC desires to provide affordable housing for its personnel;
WHEREAS, DND, in line with the action taken by BCDA, is willing to have the
remaining 3.4112 of Camp Claudio considered for mized use, to include socialized
housing primarily benefiting the military organization and its personnel;
WHEREAS, while the 5.4112 hectares area under Proclamation No. 94 is contiguous,
the areas titled in the name of the BCDA are not adjacent to each other, consequently
leaving the military-retained portions similarly scattered; and
WHEREAS, the Parties hereto appreciate that the best land use could be attained
through an integrated planning and development of the total area of Camp Claudio;
NOW, THEREFORE, in view of the foregoing premises and in consideration of the
mutual covenants hereinafter set forth, the Parties hereto have agreed as follows:
1. The area subject to this Agreement covers the 2.0 hectare property of
BCDA and 3.4112 hectares military retained area, for a total area of 5.4112
hectares, as described in said Proclamation No. 94, a copy of which is hereto
attached as Annex A and made an integral part of this Agreement, subject

47

Laws on Bases Conversion

BCDA RELATED LAWS - Proclamation No. 359

to the condition that the integrated development plan shall clearly delineate
and identify the areas respectively belonging to the BCDA and AFP and the
development particulars in each proeperty.
2. An Inter-Agency Committee is hereby formed to be composed of duly
authorized representatives of the Parties of this Agreement to

a.

Formulate a consolidation plan so as to make contiguous the BCDA


property, making the military retained area also contiguous;

b.

Formulate an integrated planning and development program for the


subject area; and

c.

Determine the allocation to the Parties of the socialized housing units


and the commercial areas and/or facilities that may be put up.

3.

The consolidation plan for the BCDA property and the military-retained
area, the integrated planning and development program and the allocation
of housing units and commercial areas/facilities shall be unanimously
approved by the representatives of the Inter-Agency Committee before their
presentation to the Parties for approval.

4.

Implementing arrangements for this project shall be entered into by and


among the Parties after recommendations of the Inter-Agency Committee
shall have been approved and signed by the Parties.

5.

This Agreement in no way diminishes the responsibility and authority of the


DND over the military-retained area.

6.

The OVP shall be Lead Ageny in this project.

WHEREAS, the Vice President of the Philippines, with the concurrence of the Secretary
of the Department of Environment and Natural Resources (DENR), the HUDCC
Chairman, and the BCDA Chairman, has proposed that the 3.4112 hectare-portion of
Camp Claudio (which remains reserved for military purposes) be reserved instead for
housing and urban development purposes;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Philippines,
upon recommendation of the Vice President of the Philippines with the concurrence
of the DENR Secretary, the HUDCC Chairman and the BCDA Chairman, do hereby
withdraw from use for military purposes the 3.4112 hectare portion of Camp Claudio
which remains reserved for military purposes, and reserve the same for housing and
urban development purposes, insofar as not otherwise provided by law, under the
administration of the Vice President of the Philippines for said purposes, subject to
private rights, if there be any.

Laws on Bases Conversion

48

BCDA RELATED LAWS - Proclamation No. 359

The Inter-Agency Committee created under the Memorandum of Understanding dated


June 4, 2002 between and among the OVP, DFA, DND and HUDCC shall, pursuant
to said Memorandum of Understanding: (i) formulate the consolidation plan and the
integrated planning and development program, and (ii) recommend the allocation of
the socialized housing units and commercial area/facilities to the Vice President of the
Philippines for approval.
City of Manila, April 4, 2003.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) ALBERTO G. ROMULO


Executive Secretary

49

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 216

Executive Order No. 216


Amending Executive Order No. 70 dated February 11, 2002, entitled
Declaring Portions of the Property of the Bases Conversion
Development Authority Located in Fort Bonifacio and Its Environs
as Socialized Housing Sites and Providing for the Disposition thereof
to Qualified Occupants and Beneficiaries
WHEREAS, there exists a territorial dispute between the City of Makati and the
Municipality of Taguig over Fort Bonifacio;
WHEREAS, portions of the properties declared for socialized housing sites are included
in the pending territorial dispute between Makati and Taguig;
WHEREAS, due to the pending territorial dispute between Makati and Taguig, both
the City Government of Makati and the Municipality of Taguig ought to be included
as members of the Executive Committee created for the purpose of implementing this
project;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Philippines,
by virtue of the powers vested in me by law, do hereby order:
SECTION 1. Section 3 of Executive Order No. 70, s. 2002, is hereby amended to read
as follows:
SEC. 3. Executive Committee. An Executive Committee shall be created to
assist HUDCC in implementing this Order. This committee shall be composed
of HUDCC as Chair, and the following as members: BCDA, Department of
Environment and Natural Resources (DENR), Presidential Commission for
the Urban Poor (PCUP), Department of National Defense/Armed Forces
of the Philippines DND/AFP in so far as military personnel residing in the
areas covered, the Municipal Government of Taguig, the Congressional
Representative of Taguig, the City Government of Makati and the Congressional
Representative of Makati City for District II.
SEC. 2. All orders, issuances, rules and regulations, or parts thereof which are
inconsistent with this Executive Order are hereby repealed or modified accordingly.
SEC. 3. This Executive Order shall take effect immediately.

Laws on Bases Conversion

50

BCDA RELATED LAWS - Executive Order No. 216

DONE, in the City of Manila this 9th day of June, in the year of Our Lord, Two Thousand
and Three.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) ALBERTO G. ROMULO


Executive Secretary

51

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 465

Executive Order No. 465


Further Amending Executive Order No. 70 dated February 11, 2002,
as Amended by Executive Order No. 216 dated June 9, 2003 entitled
Declaring Portions of the Property of the Bases Conversion
Development Authority Located in Fort Bonifacio and Its Environs
as Socialized Housing Sites and Providing for the Disposition thereof
to Qualified Occupants and Beneficiaries, Clarifying the Transfer of
Ownership and Administration, and Defining the Duties and Roles of
the Implementing Agencies
WHEREAS, pursuant to Section 7 of Republic Act (RA) 7227, as amended by RA 7917,
the President issued Executive Order (EO) 40, s. 1992, transferring the ownership of
certain Metro Manila military camps such as portions of Fort Bonifacio to the Bases
Conversion and Development Authority (BCDA), and prioritizing the same privatization
and disposal;
WHEREAS, pursuant to Section 8 (d) (3) of RA 7227 as amended by RA 7917, twelve
percent (12%) of the proceeds from the sale of properties transferred to BCDA for
disposition after deducting all expenses related thereto, shall be used to finance the
National Shelter Program (NSP), the mass social housing projects and the concessional
and long-term housing loan assistance for the underprivileged and homeless citizens;
WHEREAS, EO 70, s. 2002, as amended by EO 216, s. 2003, transferred to the Housing
and Urban Development Coordinating Council (HUDCC) the administration and
control of certain properties in Fort Bonifacio owned by BCDA with a total area of 119
hectares for disposition to qualified residents;
WHEREAS, due to prior institutional arrangements entered into by BCDA, the scope of
EO 70 needs to be redefined to exclude the Pamayanang Diego Silang;
WHEREAS, there is a need to transfer ownership of the properties subject of this EO to
allow the recipient to effectively administer and dispose the properties transferred to it,
for the purposes herein stated;
WHEREAS, HUDCC recognizes that the properties transferred to it by virtue of EO 70,
including and improvements thereon, represent part of the contribution of BCDA to
NSP;
WHEREAS, there is a need to designate NHA as the lead implementing agency, to
acquire ownership of the said property, and to be included as member of the Executive
Committee formed under EO 70
NOW, THEREFORE, I GLORIA MACAPAGAL-ARROYO, President of the Republic of
the Philippines, by virtue of the powers vested in me by law, do hereby order:
Laws on Bases Conversion

52

BCDA RELATED LAWS - Executive Order No. 465

SECTION 1. Sections 1, 2, 3, and 4 of EO 70 s. 2002 are hereby amended to read as


follows:
SECTION 1, Declaration as Socialized Housing Sites with Mixed Use
Development. In view of the need to address the socialized housing needs of
informal settlers, to generate revenues to subsidize land development costs of
the socialized housing areas, and to conform with land use zoning ordinances,
the following BCDA properties in Fort Bonifacio and its environs are hereby
declared as sites for socialized housing with mixed use development, and open
for disposition housing with mixed use development, and open for disposition
to qualified housing with mixed use development, and open for disposition to
qualified occupants, beneficiaries and the general public:
a) Lupang Katuparan (452,917 sqm)
Northwest Portion - Lot 2 of Pcs-00-007293
Southeast Portion - Lot 3 of Pcs-00-007293
b) Philippine Centennial Village (130,807 sqm.)
Developed Area - SWO-00-007607-001202-D
Undeveloped Area - Boundary, Lots 11, 12, and 13 of SW0-00-001302
BHIT Park (350,000 sqm)
c) The exact metes and bound of the BHIT Part area to be included in this
Order shall be determined by BCDA.
This declaration shall include, in the case of Philippine Centennial Village,
1,140 residential units in 4-storey medium-rise buildings therein and in the
case of Lupang Katuparan, the common areas, and the water and electrical
facilities therein.
Pamayanang Diego Silang with an area of 23.86 hectares shall be excluded
from the coverage of Executive Order No. 70 and shall remain under the
ownership, management, and control of BCDA.
SECTION 2. Transfer of Ownership of Properties Covered under this Order to
the National Housing Authority (NHA) as Lead Implementing Agency.
The National Housing Authority is hereby designated as the lead implementing
agency, and shall acquire ownership of the properties as provided in Section
1 of this Order. The BCDA and NHA shall execute the appropriate legal
documents to perfect transfer of ownership of properties covered under this
Order subject to such terms and conditions as may be mutually agreed upon
by them.

53

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 465

Within sixty (60) days from the effectivity of this Order, the HUDCC shall turn
over to the NHA all monies, accounts and records of it administration of BCDA
properties turned over to it by virtue of Executive Order No. 70. Furthermore,
NHA shall be free from charges, imposition and other liabilities accruing on
the properties to be transferred to NHA.
SECTION 3. Executive Committee. An Executive Committee shall be created
as the policy-making body in the implementation of this Order. It shall be
composed of HUDCC as Chairman and the following as members; NHA,
BCDA, DENR, PCUP, DND/AFP, the LGU of Taguig City, and the Congressional
Representative of Taguig City. The Executive Committee shall have the
following responsibilities:
Provide the policies and guidelines for the implementation of this Order; and
Define and delineate the roles and responsibilities of various government
agencies, peoples organizations and individual beneficiaries in the
implementation of this Order.
SECTION 4. Funding. The NHA shall formulate a budget to implement this
Order taking into account the funding requirements for the various activities
(e.g. social preparations, census and tagging, ground survey, mobilization,
etc.) that must be undertaken in connection hereof. The Department of Budget
and Management shall ensure the provision of the funding requirements of the
Project, subject to existing laws, rules and regulations.
SECTION 2. A new Section 5 is hereby added to read as follows:
SECTION 5. The Funds for the purchase of the subject properties shall be
sourced from the twelve percent (12%) share of the National Shelter Program
under Republic Act No. 7227, as amended.
The Executive Committee, in coordination with the Department of Budget and
Management, shall formulate the necessary guidelines and/or procedures to
carry out the provisions of this Section
SECTION 3. A new Section 6 is hereby added to read as follows:
SECTION 6. All properties identified and/or classified herein as easements
shall be retained as such and shall not be subject for socialized housing use.
All properties not expressly included in this Order are hereby excluded.
SECTION 4. Section 5 of EO 70 is hereby re-numbered as Section 7.
SECTION 5. This EO shall take effect immediately.

Laws on Bases Conversion

54

BCDA RELATED LAWS - Executive Order No. 465


DONE in the City of Manila, Philippines, this 3rd day of October in the year of Our
Lord, Two Thousand and Five.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

55

Laws on Bases Conversion

BCDA RELATED LAWS - Executive Order No. 516

Executive Order No. 516


Returning the Bases Conversion
to the Office of the President

and

Development Authority

WHEREAS, Executive Order No. 504 (s. 2006) Section 5 mandated the Secretary
of Trade and Industry to exercise policy oversight over the Bases Conversion and
Development Authority (BCDA),
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic of
the Philippines, by virtue of the powers vested in me by law and the Constitution, do
hereby order:
The BCDA is hereby reverted to the Office of the President. Section 5 of Executive
Order No. 504 is hereby repealed.
City of Manila, 24 March 2006

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

Laws on Bases Conversion

56

BCDA RELATED LAWS - Republic Act No. 9400

Republic Act No. 9400


An Act Amending Republic Act No. 7227, as Amended,
Otherwise Known as the Bases Conversion and Development Act
of 1992, and for Other Purposes
Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:
SECTION 1. Section 12 of Republic Act No. 7227, as amended, otherwise known as
the Bases Conversion and Development Act of 1992, is hereby amended to read as
follows:
Section 12. Subic Special Economic Zone.x x x
(a) x x x
(b) The Subic Special Economic Zone shall be operated and managed as a separate
customs territory ensuring free flow or movement of goods and capital within,
into and exported out of the Subic Special Economic Zone, as well as provide
incentives such as tax and duty-free importations of raw materials, capital and
equipment. However, exportation or removal of goods from the territory of the
Subic Special Economic Zone to the other parts of the Philippine territory shall
be subject to customs duties and taxes under the Tariff and Customs Code of
the Philippines, as amended, the National Internal Revenue Code of 1997, as
amended, and other relevant tax laws of the Philippines;
(c) The provision of existing laws, rules and regulations to the contrary
notwithstanding, no national and local taxes shall be imposed within the
Subic Special Economic Zone. In lieu of said taxes, a five percent (5%) tax on
gross income earned shall be paid by all business enterprises within the Subic
Special Economic Zone and shall be remitted as follows: three percent (3%) to
the National Government, and two percent (2%) to the Subic Bay Metropolitan
Authority (SBMA) for distribution to the local government units affected by the
declaration of and contiguous to the zone, namely: the City of Olongapo and
the municipalities of Subic, San Antonio, San Marcelino and Castillejos of
the Province of Zambales; and the municipalities of Morong, Hermosa and
Dinalupihan of the Province of Bataan, on the basis of population (50%), land
area (25%) and equal sharing (25%).

x x x.

SECTION 2. Section 15 of Republic Act No. 7227, as amended, is hereby amended


to read as follows:

57

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 9400

Section 15. Clark Special Economic Zone (CSEZ) and Clark Freeport Zone
(CFZ).Subject to the concurrence by resolution of the local government units
directly affected, the President is hereby authorized to create by executive
proclamation a Special Economic Zone covering the lands occupied by the
Clark military reservations and its contiguous extensions as embraced, covered
and defined by the 1947Military Bases Agreement between the Philippines
and the United States of America, as amended, located within the territorial
jurisdiction of Angeles City, municipalities of Mabalacat and Porac, Province
of Pampanga, and the municipalities of Capas and Bamban, Province of
Tarlac, in accordance with the provision as herein provided insofar as applied
to the Clark military reservations. The Clark Air Base proper with an area of
not more than four thousand four hundred hectares (4,400 has.), with the
exception of the twenty-two hectare commercial area situated near the main
gate and the Bayanihan Park consisting of seven and a half hectares (7.5 has.)
located outside the main gate of the Clark Special Economic Zone, is hereby
declared a freeport zone.
The CFZ shall be operated and managed as a separate customs territory
ensuring free flow or movement of goods and capital equipment within, into
and exported out of the CFZ, as well as provide incentives such as tax and
duty-free importation of raw materials and capital equipment. However,
exportation or removal of goods from the territory of the CFZ to the other parts
of the Philippine territory shall be subject to customs duties and taxes under
the Tariff and Customs Code of the Philippines, as amended, the National
Internal Revenue Code of 1997, as amended, and other relevant tax laws of
the Philippines.
The provisions of existing laws, rules and regulations to the contrary
notwithstanding, no national and local taxes shall be imposed on registered
business enterprises within the CFZ. In lieu of said taxes, a five percent (5%)
tax on gross income earned shall be paid by all registered business enterprises
within the CFZ and shall be directly remitted as follows: three percent (3%)
to the National Government, and two percent (2%) to the treasurers office of
the municipality or city where they are located.
The governing body of the Clark Special Economic Zone shall likewise
be established by executive proclamation with such powers and functions
exercised by the Export Processing Zone Authority pursuant to Presidential
Decree No. 66, as amended: Provided, That it shall have no regulatory authority
over public utilities, which authority pertains to the regulatory agencies
created by law for the purpose, such as the Energy Regulatory Commission
created under Republic Act No. 9136 and the National Telecommunications
Commission created under Republic Act No. 7925.
x x x
Laws on Bases Conversion

58

BCDA RELATED LAWS - Republic Act No. 9400

Subject to the concurrence by resolution of the local government units


directly affected and upon recommendation of the Philippine Economic Zone
Authority (PEZA), the President is hereby authorized to create by executive
proclamation Special Economic Zones covering the City of Balanga and the
municipalities of Limay, Mariveles, Morong, Hermosa and Dinalupihan,
Province of Bataan.
Subject to the concurrence by resolution of the local government units
directly affected and upon recommendation of the PEZA, the President is
hereby authorized to create by executive proclamation Special Economic
Zones covering the municipalities of Castillejos, San Marcelino and San
Antonio, Province of Zambales.
Duly registered business enterprises that will operate in the Special Economic
Zones to be created shall be entitled to the same tax and duty incentives as
provided for under Republic Act No. 7916, as amended: Provided, That for the
purpose of administering these incentives, the PEZA shall register, regulate,
and supervise all registered enterprises within the Special Economic Zones.
SECTION 3. A new Section 15-A is hereby inserted, amending Republic Act No.
7227, as amended, to read as follows:
Section 15-A. Poro Point Freeport Zone (PPFZ).The two hundred thirtysix and a half-hectare (236.5 has.) secured area in the Poro Point Special
Economic and Freeport Zone created under Proclamation No. 216, series
of 1993, shall be operated and managed as a freeport and separate customs
territory ensuring free flow or movement of goods and capital equipment
within, into and exported out of the PPFZ. The PPFZ shall also provide
incentives such as tax and duty-free importation of raw materials and capital
equipment. However, exportation or removal of goods from the territory of the
PPFZ to the other parts of the Philippine territory shall be subject to customs
duties and taxes under the Tariff and Customs Code of the Philippines, as
amended, the National Internal Revenue Code of 1997, as amended, and
other relevant tax laws of the Philippines.
The provisions of existing laws, rules and regulations to the contrary
notwithstanding, no national and local taxes shall be imposed on registered
business enterprises within the PPFZ. In lieu of said taxes, a five percent (5%)
tax on gross income earned shall be paid by all registered business enterprises
within the PPFZ and shall be directly remitted as follows: three percent (3%)
to the National Government, and two percent (2%) to the treasurers office of
the municipality or city where they are located.
The governing body of the PPFZ shall have no regulatory authority over
public utilities, which authority pertains to the regulatory agencies created by
law for the purpose, such as the Energy Regulatory Commission created under

59

Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 9400

Republic Act No. 9136 and the National Telecommunications Commission


created under Republic Act No. 7925.
SECTION 4. A new Section 15-B is hereby inserted, amending Republic Act No.
7227, as amended, to read as follows:
Section 15-B. Morong Special Economic Zone (MSEZ).Duly registered
business enterprises operating within the MSEZ created under Proclamation
No. 984, series of 1997, shall be entitled to tax and duty-free importation of
raw materials and capital equipment. In lieu of all national and local taxes
except real property tax on land, a five percent (5%) tax on gross income
earned shall be paid by all registered business enterprises which shall be
directly remitted as follows: three percent (3%) to the National Government,
and two percent (2%) to the treasurers office of the municipality or city where
they are located.
SECTION 5. A new Section 15-C is hereby inserted, amending Republic Act No.
7227, as amended, to read as follows:
Section 15-C. John Hay Special Economic Zone (JHSEZ).Registered business
enterprises which will operate after the effectivity of this Act, within the JHSEZ
created under Proclamation No. 420, series of 1994, shall be entitled to the
same tax and duty incentives as provided for under Republic Act No. 7916,
as amended: Provided, That for the purpose of administering these incentives,
the PEZA shall register, regulate and supervise all registered enterprises within
the JHSEZ. Provided, further, That the Conversion Authority and the John Hay
Management Corporation (JHMC) shall only engage in acquiring, owning,
holding, administering or leasing real properties, and in other activities
incidental thereto.
SECTION 6. In case of conflict between national and local laws with respect to the tax
exemption privileges in the CFZ, PPFZ, JHSEZ and MSEZ, the same shall be resolved in
favor of the aforementioned zones: Provided, That the CFZ and PPFZ shall be subject to
the provisions of paragraphs (d), (e), (f), (g), (h), and (i) of Section 12 of Republic Act No.
7227, as amended.
SECTION 7. Business enterprises presently registered and granted with tax and duty
incentives by the Clark Development Corporation (CDC), Poro Point Management
Corporation (PPMC), JHMC and Bataan Technological Park, Incorporated (BTPI),
including such governing bodies, shall be entitled to the same incentives until the
expiration of their contracts entered into prior to the effectivity of this Act.
SECTION 8. ADMINISTRATION, IMPLEMENTATION AND MONITORING OF
INCENTIVES.The governing authorities shall be responsible for the administration
and implementation of the incentives granted to their respective registered enterprises.

Laws on Bases Conversion

60

BCDA RELATED LAWS - Republic Act No. 9400

They shall submit to the Department of Finance (DOF) their respective annual tax
expenditures based on the computed costs in terms of revenue foregone on the tax
incentives granted to their registered enterprises. For proper monitoring, the DOF shall
create a single database of all incentives provided by all these authorities. The DOF
shall monitor and review the incentives granted and submit an annual report to the
President.
SECTION 9. PENAL PROVISIONS.Any registered business enterprise found guilty
of smuggling by final judgment, either as principal, accomplice or accessory shall be
perpetually barred from doing business in any freeport and special economic zone, in
addition to the penalties and sanctions imposed by existing laws.
SECTION 10. IMPLEMENTING RULES AND REGULATIONS.The DOF, in
coordination with the PEZA, the Bureau of Internal Revenue (BIR) and the Bureau of
Customs (BOC), in consultation with the Bases Conversion and Development Authority
(BCDA), the SBMA, the CDC, the JHMC, the PPMC, and the BTPI, shall promulgate
and publish the necessary rules and regulations for the effective implementation of this
Act within two months from the date of effectivity of this Act.
SECTION 11. SEPARABILITY CLAUSE.If any portion or provision of this Act is
declared unconstitutional, the remainder of this Act or any provision not affected
thereby shall remain in force and effect.
SECTION 12. REPEALING CLAUSE.All laws, decrees, orders, proclamations, rules
and regulations or other issuances or parts thereof inconsistent with the provisions of
this Act are hereby repealed or modified accordingly.
The provision of Section 50 of Republic Act No. 7916, as amended, is hereby repealed.
The provision of Section 13(b) (3) of Republic Act No. 7227, as amended, with respect
to public utilities engaged in the provision of electric power and telecommunication
services are hereby repealed.
SECTION 13. EFFECTIVITY.This Act shall take effect fifteen (15) days after its
publication in the Official Gazette or in any two newspapers of general circulation,
whichever comes earlier.
Approved,

(Sgd.) MANNY VILLAR



President of the Senate

61

(Sgd.) JOSE DE VENECIA, JR.


Speaker of the
House of Representatives
Laws on Bases Conversion

BCDA RELATED LAWS - Republic Act No. 9400

This Act which is a consolidation of House Bill No. 5064 and Senate Bill No. 2260 was
finally passed by the House of Representatives and the Senate on January 31, 2007 and
February 5, 2007, respectively.

(Sgd.) OSCAR G. YABES


Secretary of the Senate

(Sgd.) ROBERTO P. NAZARENO


Secretary General
House of Representatives

Approved: March 20, 2007

(Sgd.) GLORIA MACAPAGAL-ARROYO


President of the Philippines

Laws on Bases Conversion

62

ECONOMIC ZONES - Republic Act No. 7916

Republic Act No. 7916


An Act Providing for Legal Framework and Mechanisms for the Creation,
Operation, Administration, and Coordination of Special Economic Zones
in the Philippines, Creating for this Purpose, the Philippine Economic
Zone Authority (PEZA), and for Other Purposes
Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:
Chapter I
Purposes and Objectives: Establishment and Nature of Special Economic Zones;
Coordination with Other Similar Schemes
SECTION 1. Title. This act shall be known and cited as The Special Economic Zone
Act of 1995.
SECTION 2. Declaration of Policy. It is the declared policy of the government to
translate into practical realities the following State policies and mandates in the 1987
Constitution, namely:
a. The State recognizes the indispensible role of the private sector, encourages
private enterprise, and provides incentives to needed investments. (Sec. 20,
Art II)
b. The State shall promote the preferential use of Filipino labor, domestic
materials and locally produced goods and adopt measures that help make
them competitive. (Sec. 12, Art XII)
c. In pursuance of these policies, the government shall actively encourage,
promote, induce and accelerate a sound and balanced industrial, economic
and social development of the country in order to provide jobs to the people
specially those in the rural areas, increase their productivity and their individual
and family income, and thereby improve the level and quality of their living
condition through the establishment, among others, of special economic zones
in suitable and strategic locations in the country and through measures that
shall effectively attract legitimate and productive foreign investments.
SECTION 3. Purposes, Intents and Objectives. It is the purpose, intent and objective
of this Act:
a. To establish the legal framework and mechanisms for the integration,
coordination, planning and monitoring of special economic zones, industrial
estates / parks, export processing zones and other economic zones;

63

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

b. To transform selected areas in the country into highly developed agro


industrial, industrial, commercial, tourist, banking, investment, and financial
centers, where highly trained workers and efficient services will be available
to commercial enterprises;
c. To promote the flow of investors, both foreign and local, into special economic
zones which would generate employment opportunities and establish
backward and forward linkages among industries in and around the economic
zones;
d. To stimulate the repatriation of Filipino capital by providing attractive climate
and incentives for business activity;
e. To promote financial and industrial cooperation between the Philippines
and industrialized countries through technology-intensive industries that will
modernize the countrys industrial sector and improve productivity levels by
utilizing new technological and managerial know-how; and
f. To vest the special economic zones on certain areas thereof with the status of
a separate customs territory within the framework of the Constitution and the
national sovereignty and territorial integrity of the Philippines.
SECTION 4. Definition of Terms.For purposes of this Act, the following definitions
shall apply to the following terms:
a. Special Economic Zones (SEZ) hereinafter referred to as the ECOZONES,
are selected areas with highly developed or which have the potential to be
developed into agro-industrial, Industrial tourist/recreational, commercial,
banking, investment and financial centers. An ECOZONE may contain any
or all of the following: Industrial Estates (IEs), Export Processing Zones (EPZs),
Free Trade Zones, and Tourist/Recreational Centers.
b. Industrial Estate (IE) refers to a tract of land subdivided and developed
according to a comprehensive plan under a unified continuous management
and with provisions for basic infrastructure and utilities, with or without prebuilt standard factory buildings and community facilities for the use of the
community of industries.
c. Export Processing Zone (EPZ) a specialized industrial estate located
physically and/or administratively outside customs territory, predominantly
oriented to export production. Enterprises located in export processing zones
are allowed to import capital equipment and raw materials free from duties,
taxes and other import restrictions.

Laws on Bases Conversion

64

ECONOMIC ZONES - Republic Act No. 7916

d. Free Trade Zone - an isolated policed area adjacent to a port of entry (as a
seaport) and/or airport where imported goods may be unloaded for immediate
transshipment or stored, repacked, sorted, mixed, or otherwise manipulated
without being subject to import duties. However, movement of these imported
goods from the free-trade area to a non-free-trade area in the country shall be
subject to import duties.
Enterprises within the zone are granted preferential tax treatment and
immigration laws are more lenient.
SECTION 5. Establishment of ECOZONES. To ensure the viability and geographical
dispersal of ECOZONES through a system of prioritization, the following areas are
initially identified as ECOZONES, subject to the criteria specified in Section 6:
a. So much as may be necessary of that portion of Morong, Hermosa, Dinalupihan,
Orani, Samal, and Abucay in the Province of Bataan;
b. So much as may be necessary of that portion of the municipalities of Ibaan,
Rosario, Taysan, San Jose, San Juan, and cities of Lipa and Batangas;
c. So much as may be necessary of that portion of the City of Cagayan de Oro in
the Province of Misamis Oriental;
d. So much as may be necessary of that portion of the City of Iligan in the Province
of Lanao del Norte;
e. So much as may be necessary of that portion of the Province of Saranggani;
f. So much as may be necessary of that portion of the City of Laoag in the
Province of Ilocos Norte;
g. So much as may be necessary of that portion of Davao City and Samal Island
in the Province of Davao del Norte;
h. So much as may be necessary of that portion of Oroquieta City in the Province
of Misamis Occidental;
i. So much as may be necessary of that portion of Tubalan Cove, Malita in the
Province of Davao del Sur;
j. So much as may be necessary of that portion of Baler, Dinalungan and
Casiguran including its territorial waters and islets and its immediate environs
in the Province of Aurora;

65

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

k. So much as may be necessary of that portion of cities of Naga and Iriga in the
Province of Camarines Sur, Legaspi and Tabaco in the Province of Albay, and
Sorsogon in the Province of Sorsogon;
l. So much as may be necessary of that portion of Bataan Island in the Province
of Batanes;
m. So much as may be necessary of that portion of Lapu-lapu in the Island of
Mactan, and the municipalities of Balamban and Pinamungahan and the cities
of Cebu and Toledo and the Province of Cebu, including its territorial waters
and islets and its immediate environs;
n. So much as may be necessary of that portion of Tacloban City;
o. So much as may be necessary of that portion of the Municipality of Barugo in
the Province of Leyte;
p. So much as may be necessary of that portion of the Municipality of Buenavista
in the Province of Guimaras;
q. So much as may be necessary of that portion of the municipalities of San Jose
de Buenavista, Hamtic, Sibalon, and Culasi in the Province of Antique;
r. So much as may be necessary of that portion of the municipalities of Catarman,
Bobon and San Jose in the Province of Northern Samar, the Island of Samar;
s. So much as may be necessary of that portion of the Municipality of Ternate and
its immediate environs in the Province of Cavite;
t. So much as may be necessary of that portion of Polloc, Parang in the Province
of Maguindanao;
u. So much as may be necessary of that portion of the Municipality of Boac in the
Province of Marinduque;
v. So much of may be necessary of that portion of the Municipality of Pitogo in
the Province of Zamboanga del Sur;
w. So much as may be necessary of that portion of Dipolog City-Manukan Corridor
in the Province of Zamboanga del Norte;
x. So much as may be necessary of that portion of Mambajao, Camiguin Province;

Laws on Bases Conversion

66

ECONOMIC ZONES - Republic Act No. 7916

y. So much as may be necessary of that portion of Infanta, Real, Polillo, Alabat,


Atimonan, Mauban, Tiaong, Pagbilao, Mulanay, Tagkawayan, and Dingalan
Bay in the Province of Quezon;
z. So much as may be necessary of that portion of Butuan City and the Province
of Agusan del Norte, including its territorial waters and islets and its immediate
environs;
aa. So much as may be necessary of that portion of Roxas City including its
territorial waters and islets and its immediate environs in the Province of Capiz;
bb. So much as may be necessary of that portion of San Jacinto, San Fabian,
Mangaldan, Lingayen, Sual, Dagupan, Alaminos, Manaoag, Binmaley in the
Province of Pangasinan;
cc. So much as may be necessary of that portion of the autonomous region;
dd. So much as may be necessary of that portion of Masinloc, Candelaria and Sta.
Cruz in the Province of Zambales;
ee. So much as may be necessary of that portion of the Palawan Island;
ff. So much as may be necessary of that portion of General Santos City in South
Cotabato and its immediate environs;
gg. So much as may be necessary of that portion of Dumaguete City and Negros
Oriental, including its territorial waters and islets and its immediate environs;
hh. So much as may be necessary of that portion of the Province of Ilocos Sur;
ii. So much as may be necessary of that portion of the Province of La Union;
jj. So much as may be necessary of that portion of the Province of Laguna, including
its territorial waters and its immediate environs;
kk. So much as may be necessary of that portion of the Province of Rizal;
ll. All existing export processing zones and government-owned industrial estates;
and
mm. Any private industrial estate which shall voluntarily apply for conversion into
an ECOZONE.

67

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

These areas shall be developed through any of the following schemes:


i. Private initiative;
ii. Local government initiative with the assistance of the national government; and
iii. National government initiative.
The metes and bounds of each ECOZONE are to be delineated and more particularly
described in a proclamation to be issued by the President of the Philippines, upon
the recommendation of the Philippine Economic Zone Authority (PEZA), which
shall be established under this Act, in coordination with the municipal and / or city
council, National Land Use Coordinating Committee and / or the Regional Land
Use Committee.
SECTION 6. Criteria for the Establishment of Other ECOZONES.In addition to the
ECOZONES identified in Section 5 of this Act, other areas may be established as
ECOZONES in a proclamation to be issued by the President of the Philippines subject
to the evaluation and recommendation of the PEZA, based on a detailed feasibility and
engineering study which must conform to the following criteria:
a. The proposed area must be identified as a regional growth center in the
Medium-Term Philippine Development Plan or by the Regional Development
Council;
b. The existence of required infrastructure in the proposed ECOZONE, such
as roads, railways, telephones, ports, airports, etc., and the suitability and
capacity of the proposed site to absorb such improvements;
c. The availability of water source and electric power supply for use of the
ECOZONE;
d. The extent of vacant lands available for industrial and commercial development
and future expansion of the ECOZONE as well as of lands adjacent to the
ECOZONE available for development of residential areas for the ECOZONE
workers;
e. The availability of skilled, semi-skilled and non-skilled trainable labor force in
and around the ECOZONE;
f. The area must have a significant incremental advantage over the existing
economic zones and its potential profitability can be established;
g. The area must be strategically located; and

Laws on Bases Conversion

68

ECONOMIC ZONES - Republic Act No. 7916

h. The area must be situated where controls can easily be established to curtail
smuggling activities.
Other areas which do not meet the foregoing criteria may be established as
ECOZONES: Provided, That the said area shall be developed only through local
government and/or private sector initiative under any of the schemes allowed in
Republic Act No. 6957 (the build-operate-transfer law), and without any financial
exposure on the part of the national government: Provided, further, That the area
can be easily secured to curtail smuggling activities: Provided, finally, That after
five (5) years the area must have attained a substantial degree of development, the
indicators of which shall be formulated by the PEZA.
SECTION 7. ECOZONE to be a Decentralized Agro-Industrial, Industrial, Commercial
/ Trading, Tourist, Investment and Financial Community. - Within the framework of
the Constitution, the interest of national sovereignty and territorial integrity of the
Republic, ECOZONE shall be developed, as much as possible, into a decentralized,
self-reliant and self-sustaining industrial,commercial/trading, agro-industrial, tourist,
banking, financial and investment center with minimum government intervention.
Each ECOZONE shall be provided with transportation, telecommunications, and other
facilities needed to generate linkage with industries and employment opportunities for
its own inhabitants and those of nearby towns and cities.
The ECOZONE shall administer itself on economic, financial, industrial, tourism
development and such other matters within the exclusive competence of the
national government.
The ECOZONE may establish mutually beneficial economic relations with other
entities within the country, or, subject to the administrative guidance of the
Department of Foreign Affairs and/or the Department of Trade and Industry, with
foreign entities or enterprises.

69

Foreign citizens and companies owned by non-Filipinos in whatever proportion


may set up enterprises in the ECOZONE, either by themselves or in joint venture
with Filipinos in any sector of industry, international trade and commerce within
the ECOZONE. Their assets, profits and other legitimate interests shall be protected:
Provided, That the ECOZONE through the PEZA may require a minimum investment
for any ECOZONE enterprises in freely convertible currencies: Provided, further,
That the new investment shall fall under the priorities, thrusts and limits provided
for in the Act.

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

SECTION 8. ECOZONE to be Operated and Managed as Separate Customs Territory.


The ECOZONE shall be managed and operated by the PEZA as separate customs
territory.
The PEZA is hereby vested with the authority to issue certificate of origin for
products manufactured or processed in each ECOZONE in accordance with the
prevailing rules or origin, and the pertinent regulations of the Department of Trade
and Industry and/or the Department of Finance.
SECTION 9. Defense and Security. The defense of the ECOZONE and the security
of its perimeter fence shall be the responsibility of the national government in
coordination with the PEZA. Military forces sent by the national government for the
purpose of defense shall not interfere in the internal affairs of any of the ECOZONE
and expenditure for these military forces shall be borne by the national government.
The PEZA may provide and establish the ECOZONES internal security and firefighting
forces.
SECTION 10. Immigration. Any investor within the ECOZONE whose initial
investment shall not be less than One Hundred Fifty Thousand Dollars ($150,000.00),
his/her spouse and dependent children under twenty-one (21) years of age shall be
granted permanent resident status within the ECOZONE. They shall have freedom of
ingress and egress to and from the ECOZONE without any need of special authorization
from the Bureau of Immigration.
The PEZA shall issue working visas renewable every two (2) years to foreign
executives and other aliens, processing highly-technical skills which no Filipino
within the ECOZONE possesses, as certified by the Department of Labor and
Employment. The names of aliens granted permanent resident status and working
visas by the PEZA shall be reported to the Bureau of Immigration within thirty (30)
days after issuance thereof.
Chapter II
Governing Structures
SECTION 11. The Philippine Economic Zone Authority (PEZA) Board. There
is hereby created a body corporate to be known as the Philippine Economic Zone
Authority (PEZA) attached to the Department of Trade and Industry. The Board shall
have a director general with the rank of department undersecretary who shall be
appointed by the President. The director general shall be at least forty (40) years of
age, of proven probity and integrity, and a degree holder in any of the following fields:
economics, business, public administration, law, management or their equivalent,
and with at least ten (10) years relevant working experience preferably in the field of
management or public administration.

Laws on Bases Conversion

70

ECONOMIC ZONES - Republic Act No. 7916

The director general shall be assisted by three (3) deputy directors general each
for policy and planning, administration and operation, who shall be appointed by
the PEZA Board, upon the recommendation of the director general. The deputy
directors general shall be at least thirty-five (35) years old, with proven probity and
integrity, and a degree holder in any of the following fields: economics, business,
public administration, law, management or their equivalent.
The Board shall be composed of thirteen (13) members as follows: the Secretary
of the Department of Trade and Industry as Chairman, the Director General of
the Philippine Economic Zone Authority as Vice-Chairman, the undersecretaries
of the Department of Finance, the Department of Labor and Employment, the
Department of Interior and Local Government, the Department of Environment
and Natural Resources, the Department of Agriculture, the Department of
Public Works and Highways, the Department of Science and Technology, the
Department of Energy, the Deputy Director General of the National Economic and
Development Authority, one (1) representative from the investors / business sector
in the ECOZONE. In case of the unavailability of the Secretary of the Department
of Trade and Industry to attend a particular board meeting, the Director General of
PEZA shall act as Chairman.
The existing Export Processing Zone Authority (EPZA) created under Presidential
Decree No. 66 shall evolve into the PEZA in accordance with the guidelines and
regulations set forth in an executive order issued for this purpose.
Members of the Board shall receive a per diem of not less than the amount
equivalent to the representation and transportation allowances of the members
of the Board and / or as may be determined by the Department of Budget and
Management: Provided, however, That per diems collected per month does not
exceed the equivalent of four (4) meetings.
SECTION 12. Functions and Powers of PEZA Board. The Philippine Economic Zone
Authority (PEZA) Board shall have the following functions and powers:
a. Set the general policies on the establishment and operations of the ECOZONES,
industrial estates, export processing zones, free trade zones, and the like;
b. Review proposals for the establishment of ECOZONES based on the set
criteria under Section 6 and endorse to the President the establishment of
the ECOZONES, industrial estates, export processing zones, free trade zones
and the like. Thereafter, it shall facilitate and assist in the organization of said
entities;
c. Regulate and undertake the establishment, operation and maintenance of
utilities, other services and infrastructure in the ECOZONE, such as heat, light

71

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

and power, water supply, telecommunication, transport, toll roads and bridges,
port services, etc., and to fix just, reasonable and competitive rates, charges
and fees therefore;
d. Approve the annual budget of the PEZA and the ECOZONE development
plans;
e. Issue rules and regulations to implement the provisions of this Act in so far as
its power and functions are concerned;
f. Exercise its powers and functions as provided for in this Act; and
g. Render annual reports to the President and the Congress.
SECTION 13. General Powers and Functions of the Authority. The PEZA shall have
the following powers and functions:
a. To operate, administer, manage and develop the ECOZONE according to the
principles and provisions set forth in this Act;
b. To register, regulate and supervise the enterprises in the ECOZONE in an
efficient and decentralized manner;
c. To coordinate with local government units and exercise general supervision
over the development, plans, activities and operations of the ECOZONES,
industrial estates, export processing zones, free trade zones, and the like;
d. In coordination with local government units concerned and appropriate
agencies, to construct, acquire, own, lease, operate and maintain on its own
or through contract, franchise, license, bulk purchase from the private sector
and build-operate-transfer scheme or joint venture, adequate facilities and
infrastructure, such as light and power systems, water supply and distribution
systems, telecommunication and transportation, buildings, structures,
warehouses, roads, bridges, ports and other facilities for the operation and
development of the ECOZONE;
e. To create, operate and/or contract to operate such agencies and functional
units or offices of the authority as it may deem necessary;
f. To adopt, alter and use a corporate seal; make contracts, lease, own or
otherwise dispose of personal or real property; sue and be sued; and otherwise
carry out its duties and functions as provided for in this Act;
g. To coordinate the formulation and preparation of the development plans of the
different entities mentioned above;
Laws on Bases Conversion

72

ECONOMIC ZONES - Republic Act No. 7916

h. To coordinate with the National Economic Development Authority (NEDA),


the Department of Trade and Industry (DTI), the Department of Science
and Technology (DOST), and the local government units and appropriate
government agencies for policy and program formulation and implementation;
and
i. To monitor and evaluate the development and requirements of entities
in subsection (a) and recommend to the local government units or other
appropriate authorities the location, incentives, basic services, utilities and
infrastructure required or to be made available for said entities.
SECTION 14. Powers and Functions of the Director General. The director general
shall be the overall coordinator of the policies, plans and programs of the ECOZONES.
As such, he shall provide overall supervision over and general direction to the
development and operations of these ECOZONES. He shall determine the structure
and the staffing pattern and personnel complement of the PEZA and establish regional
offices, when necessary, subject to the approval of the PEZA Board.
In addition, he shall have the following specific powers and responsibilities:
a. To safeguard all the lands, buildings, records, monies, credits and other
properties and rights of the ECOZONES;
b. To ensure that all revenues of the ECOZONE are collected and applied in
accordance with its budget;
c. To ensure that the investors/firms and employees of the ECOZONES are
properly discharging their respective duties;
d. To give such information and recommend such measures to the Board, as he
shall deem advantageous to the ECOZONE;
e. To submit to the Board, the ongoing and proposed projects, work and financial
program, annual budget of receipts, and expenditures of the ECOZONE;
f. To represent the ECOZONE in all its business matters and sign on its behalf
after approval of the Board, all its bonds, borrowings, contracts, agreements
and obligations made in accordance with this Act;
g. To acquire jurisdiction, as he may deem proper, over the protests, complaints,
and claims of the residents and enterprises in the ECOZONE concerning
administrative matters;

73

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

h. To recommend to the Board the grant, approval, refusal, amendment or


termination of the ECOZONE franchises, licenses, permits, contracts, and
agreements in accordance with the policies set by the Board;
i. To require owners of houses, buildings or other structures constructed without
the necessary permit whether constructed on public or private lands, to
remove or demolish such houses, buildings, structures within sixty (60) days
after notice and upon failure of such owner to remove or demolish such house,
building our structure within said period, the director general or his authorized
representative may summarily cause its removal or demolition at the expense
of the owner, any existing law, decree, executive order and other issuances or
part thereof to the contrary notwithstanding;
j. To take such emergency measures as may be necessary to avoid fires, floods
and mitigate the effects of storms and other natural or public calamities;
k. To prepare and make out plans for the physical and economic development of
the ECOZONE, including zoning and land subdivision, and issue such rules
and regulations which shall be submitted to the Board for its approval; and
l. To perform such other duties and exercises such powers as may be prescribed
by the Board, and to implement the policies, rules and regulations set by the
PEZA.
SECTION 15. Administration of Each ECOZONE.Except for privately-owned,
managed or operated ECOZONES, each ECOZONE shall be organized, administered,
managed and operated by the ECOZONE executive committee composed of the
following:
a. The administrator who shall be appointed by the PEZA Board upon
recommendation of the director general; and
b. One (1) deputy administrator to be appointed by the Board upon
recommendation of the director general.
An ECOZONE advisory body shall be created with the following members:
1. The president of the association of investors in the ECOZONE;
2. The governor of the province where the ECOZONE is located;
3. The mayor/s of the municipality/ies or city/ies where the ECOZONE is located;
4. The president of an accredited labor union in the ECOZONE;

Laws on Bases Conversion

74

ECONOMIC ZONES - Republic Act No. 7916

5. The representative of the business sector in the periphery of the ECOZONE;


and
6. The representative of the PEZA.
The ECOZONE advisory body shall have the following functions:
i. Advise the ECOZONE management on matters pertaining to policy initiatives;
and
ii. Assist the ECOZONE management in setting problems arising between labor
and any enterprise in the ECOZONE.
Privately-owned ECOZONES shall retain autonomy and independence but shall
be monitored by the PEZA for the implementation of incentives and operations for
adherence to the law.
SECTION 16. Personnel. The PEZA Board of Directors shall provide for an organization
and staff of officers and employees of the PEZA, and upon recommendation of the
director general with the approval of the Secretary of the Department of Trade and
Industry, appoint and fix the remunerations and other emoluments: Provided, That the
Board shall have exclusive and final authority to promote, transfer, assign and reassign
officers of the PEZA, any provision of existing law to the contrary notwithstanding:
Provided, further, That the director general may carry out removal of such officers and
employees.
All positions in the PEZA shall be governed by a compensation, position
classification system and qualification standards approved by the director general
with the concurrence of the Board of Directors based on a comprehensive job
analysis and audit of actual duties and responsibilities. The compensation plan
shall be comparable with the prevailing compensation plans in the Subic Bay
Metropolitan Authority (SBMA), Clark Development Corporation (BCDA) and the
private sector and shall be subject to the periodic review by the Board no more
than once every two (2) years without prejudice to yearly merit reviews or increases
based on productivity and profitability. The PEZA shall therefore be exempt from
existing laws, rules and regulations on compensation, position classification and
qualification standards. It shall however endeavor to make its systems conform as
closely as possible with the principles under Republic Act No. 6758.
The PEZA officers and employees including all Members of the Board shall not
engage directly or indirectly in partisan activities or take part in any election,
except to vote.
No officer or employee of the PEZA subject to Civil Service laws and regulations
shall be removed or suspended except for cause, as provided by law.

75

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

SECTION 17. Investigation and Inquiries.Upon a written formal complaint made


under oath, which on its face provides reasonable basis to believe that some anomaly
or irregularity might have been committed, the PEZA or the administrator of the
ECOZONE concerned, shall have the power to inquire into the conduct of firms or
employees of the ECOZONE and to conduct investigations, and for that purpose may
subpoena witnesses, administer oaths, and compel the production of books, papers,
and other evidences: Provided, That to arrive at the truth, the investigator(s) may grant
immunity from prosecution to any person whose testimony or whose possessions of
documents or other evidence is necessary or convenient to determine the truth in any
investigation conducted by him or under the authority of the PEZA or the administrator
of the ECOZONE concerned.
SECTION 18. Prohibition Against Holding Any Other Office.The director general,
deputy director general, administrators, officials and staff or assistants of the PEZA
shall not hold any other office or employment within or outside the PEZA during
their tenure. They shall not, during their tenure, directly or indirectly, practice any
profession, participate in any business, or be financially interested in any contract with,
or in any franchise, or special privilege granted by the PEZA or national government, or
any subdivision, agency, or instrumentality thereof, including any government-ownedcontrolled corporation, or its subsidiary.
SECTION 19. Disbursement of Funds.No money shall be paid out of the funds of
any ECOZONE except in pursuance of the budget as formulated and approved by the
PEZA.
SECTION 20. Full Disclosure of Financial and Business Interests.Every member of
the Board of the PEZA, the director general, the deputy directors general, and their staff
shall, upon assumption of office, make full disclosure of their financial and business
Interests.
Chapter III
Operations within the Ecozone
SECTION 21. Development Strategy of the ECOZONE. - The strategy and priority of
development of each ECOZONE established pursuant to this Act shall be formulated
by the PEZA, in coordination with the Department of Trade and Industry and the
National Economic and Development Authority; Provided, That such development
strategy is consistent with the priorities of the national government as outlined in the
medium-term Philippine development plan.
It shall be the policy of the government and the PEZA to encourage and provide
Incentives and facilitate private sector participation in the construction and
operation of public utilities and infrastructure in the ECOZONE, using any of the
schemes allowed in Republic Act No. 6957 (the build-operate-transfer law).
Laws on Bases Conversion

76

ECONOMIC ZONES - Republic Act No. 7916

SECTION 22. Survey of Resources. The PEZA shall, in coordination with appropriate
authorities and neighboring cities and municipalities, immediately conduct a survey
of the physical, natural assets and potentialities of the ECOZONE areas under its
jurisdiction.
SECTION 23. Fiscal Incentives. Business establishments operating within the
ECOZONES shall be entitled to the fiscal incentives as provided for under Presidential
Decree No. 66, the law creating the Export Processing Zone Authority, or those
provided under Book VI of Executive Order No. 226, otherwise known as the Omnibus
Investment Code of 1987.
Furthermore, tax credits for exporters using local materials as Inputs shall enjoy the
same benefits provided for in the Export Development Act of 1994.
SECTION 24. Exemption from National and Local Taxes.Except for real property
taxes on land owned by developers, no taxes, local and national, shall be imposed on
business establishments operating within the ECOZONE. In lieu thereof, five percent
(5%) of the gross income earned by all business enterprises within the ECOZONE shall
be paid and remitted as follows:
a. Three percent (3%) to the National Government;
b. Two percent (2%) which shall be directly remitted by the business establishments
to the treasurers office of the municipality or city where the enterprise is
located.
SECTION 25. Applicable National and Local Taxes.All persons and services
establishments in the ECOZONE shall be subject to national and local taxes under the
National Internal Revenue Code and the Local Government Code.
SECTION 26. Domestic Sales.Goods manufactured by an ECOZONE enterprise
shall be made available for Immediate retail sales in the domestic market, subject to
payment of corresponding taxes on the raw materials and other regulations that may
be adopted by the Board of the PEZA.
However, in order to protect the domestic industry, there shall be a negative list of
Industries that will be drawn up by the PEZA. Enterprises engaged in the industries
included in the negative list shall not be allowed to sell their products locally. Said
negative list shall be regularly updated by the PEZA.
The PEZA, in coordination with the Department of Trade and Industry and the
Bureau of Customs, shall jointly issue the necessary implementing rules and
guidelines for the effective Implementation of this section.

77

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

SECTION 27. Applicability of Banking Laws and Regulations.Existing banking laws


and Bangko Sentral ng Pilipinas (BSP) rules and regulations shall apply to banks and
financial institutions to be established in the ECOZONE and to other ECOZONEregistered enterprises. Among other pertinent regulations, these include those governing
foreign exchange and other current account transactions (trade and non-trade) local
and foreign borrowings, foreign currency deposit units, offshore banking units and
other financial institutions under the supervision of the BSP.
SECTION 28. After Tax Profits.Without prior Bangkok Sentral approval, after tax
profits and other earnings of foreign investments in enterprises in the ECOZONE may
be remitted outward in the equivalent foreign exchange through any of the banks
licensed by the Bangko Sentral ng Pilipinas in the ECOZONE: Provided, however, That
such foreign investments in said enterprises have been previously registered with the
Bangko Sentral.
SECTION 29. Eminent Domain.The areas comprising an ECOZONE may be
expanded or reduced when necessary. For this purpose, the government shall have the
power to acquire, either by purchase, negotiation or condemnation proceedings, any
private lands within or adjacent to the ECOZONE for:
a. Consolidation of lands for zone development purposes;
b. Acquisition of right of way to the ECOZONE; and
c. The protection of watershed areas and natural assets valuable to the prosperity
of the ECOZONE.
If in the establishment of a publicly-owned ECOZONE, any person or group
of persons who has been occupying a parcel of land within the Zone has to
be evicted, the PEZA shall provide the person or group of persons concerned
with proper disturbance compensation: Provided, however, That in the case of
displaced agrarian reform beneficiaries, they shall be entitled to the benefits under
the Comprehensive Agrarian Reform Law, including but not limited to Section
36 of Republic Act No. 3844, in addition to a homelot in the relocation site and
preferential employment in the project being undertaken.
SECTION 30. Leases of Lands and Buildings.Lands and buildings in each ECOZONE
may be leased to foreign investors for a period not exceeding fifty (50) years renewable
once for a period of not more than twenty-five (25) years, as provided for under
Republic Act No. 7652, otherwise known as the Investors Lease Act. The leasehold
right acquired under long-term contracts may be sold, transferred or assigned, subject
to the conditions set forth under Republic Act No. 7652.

Laws on Bases Conversion

78

ECONOMIC ZONES - Republic Act No. 7916

SECTION 31. Land Conversion.Agricultural lands may be converted for residential,


commercial, industrial and other non-agricultural purposes, subjects to the conditions
set forth under Republic Act No. 6657 and other existing laws.
SECTION 32. Shipping and Shipping Register.Private shipping and related business
including private container terminals may operate freely in the ECOZONE, subject
only to such minimum reasonable regulations of local application which the PEZA
may prescribe.
The PEZA shall, in coordination with the Department of Transportation and
Communications, maintain a shipping register for each ECOZONE as a business
register of convenience for ocean-going vessels and issue related certification.
Ships of all sizes, descriptions and nationalities shall enjoy access to the ports of the
ECOZONE, subject only to such reasonable requirement as may be prescribed by
the PEZA In coordination with the appropriate agencies of the national government.
SECTION 33. Protection of Environment.The PEZA, in coordination with the
appropriate agencies, shall take concrete and appropriate steps and enact the proper
measure for the protection of the local environment.
SECTION 34. Termination of Business.Investors In the ECOZONE who desire to
terminate business or operations shall comply with such requirements and procedures
which the PEZA shall set, particularly those relating to the clearing of debts. The assets
of the closed enterprise can be transferred and the funds con be remitted out of the
ECOZONE subject to the rules, guidelines and procedures prescribed jointly by the
Bangko Sentral ng Pilipinas, the Department of Finance and the PEZA.
SECTION 35. Registration of Business Enterprises.Business enterprises within a
designated ECOZONE shall register with the PEZA to avail of all incentives and benefits
provided for in this Act.
SECTION 36. One Stop Shop Center.The PEZA shall establish a one stop shop center
for the purpose of facilitating the registration of new enterprises in the ECOZONE.
Thus, all appropriate government agencies that are Involved In registering, licensing or
issuing permits to investors shall assign their representatives to the ECOZONE to attend
to Investors requirements.
Chapter IV
Industrial Harmony in the Ecozones
SECTION 37. Labor and Management Relations.Except as otherwise provided in
this Act, labor and management relations in the ECOZONE shall be governed by the
existing Labor Code of the Philippines. Employees and personnel in the ECOZONE

79

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

enterprises shall receive salaries and benefits and shall enjoy working conditions not
less than those provided under the Philippine Labor Code and other relevant laws,
issuances, rules and regulations of the Philippine government and the Department of
Labor and Employment.
SECTION 38. Promotion of Industrial Peace.In the pursuit of Industrial harmony
in the ECOZONE, a tripartite body composed of one (1) representative each from
the Department of Labor and Employment, labor sector and business and industry
sectors shall be created In order to formulate a mechanism under a social pact for the
enhancement and preservation of industrial peace in the ECOZONE within thirty (30)
days after the effectivity of this Act.
SECTION 39. Master Employment Contracts.The PEZA, in coordination with the
Department of Tabor and Employment, shall prescribe a master employment contract
for all ECOZONE enterprise staff members and workers, the terms of which provide
salaries and benefits not less than those provided under this Act, the Philippine Labor
Code, as amended, and other relevant issuances of the national government.
SECTION 40. Percentage of Foreign Nationals.Employment of foreign nationals
hired by ECOZONE enterprises in a supervisory, technical or advisory capacity shall
not exceed five percent (5%) of Its workforce without the express authorization of the
Secretary of Labor and Employment.
SECTION 41. Migrant Worker.The PEZA, in coordination with the Department of
Labor and Employment, shall promulgate appropriate measures and programs leading
to the expansion of the services of the ECOZONE to help the local governments of
nearby areas meet the needs of the migrant workers.
SECTION 42. Incentive Scheme.An additional deduction equivalent to one- half
(1/2) of the value of training expenses incurred In developing skilled or unskilled labor
or for managerial or other management development programs incurred by enterprises
In the ECOZONE can be deducted from the national governments share of three
percent (3%) as provided In Section 24.
The PEZA, the Department of Labor and Employment, and the Department of
Finance shall jointly make a review of the incentive scheme provided In this
section every two (2) years or when circumstances so warrant.
Chapter V
National Government and Other Entities
SECTION 43. Relationship with the Regional Development Council.The PEZA shall
determine the development goals for the ECOZONE within the framework of national

Laws on Bases Conversion

80

ECONOMIC ZONES - Republic Act No. 7916

development plans, policies and goals, and the administrator shall, upon approval by
the PEZA Board, submit the ECOZONE plans, programs and projects to the regional
development council for inclusion in and as inputs to the overall regional development
plan.
SECTION 44. Relationship with the Local Government Units.Except as herein
provided, the local government units comprising the ECOZONE shall retain their basic
autonomy and identity. The cities shall be governed by their respective charters and
the municipalities shall operate and function In accordance with Republic Act No.
7160, otherwise known as the Local Government Code of 1991.
SECTION 45. Relationship of PEZA to Privately-Owned Industrial Estates.Privatelyowned industrial estates shall retain their autonomy and independence and shall be
monitored by the PEZA for the implementation of incentives.
SECTION 46. Transfer of Resources.The relevant functions of the Board of Investments
over industrial estates and agri-export processing estates shall be transferred to the
PEZA. The resources of government-owned Industrial estates and similar bodies
except the Bases Conversion Development Authority and those areas identified under
Republic Act No. 7227, are hereby transferred to the PEZA as the holding agency. They
are hereby detached from their mother agencies and attached to the PEZA for policy,
program and operational supervision.
The Boards of the affected government-owned industrial estates shall be phased
out and only the management level and an appropriate number of personnel shall
be retained.
Government personnel whose services are not retained by the PEZA or any
government office within the ECOZONE shall be entitled to separation pay and
such retirement and other benefits they are entitled to under the laws then in force
at the time of their separation: Provided, That in no case shall the separation pay
be less than one and one-fourth (1 1/4) month of every year of service.
Chapter VI
Miscellaneous Provisions
SECTION 47. Appropriation.Upon the effectivity of this Act, all funds of the former
Export Processing Zone Authority (EPZA) shall be transferred to the newly-created
Philippine Economic Zone Authority, Thereafter, any sum as may be necessary to
augment its capital outlay shall be Included In the General Appropriations Act to be
treated as an equity of the national government.

81

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

Additional funding shall come from the following:


a. The annual subsidies, appropriations and/or other assets of the exports
processing zone, and the industrial estates and other economic areas that have
been absorbed/transferred to the PEZA as mandate in this Act;
b. The proceeds from the rent of lands, buildings, and other properties of the
ECOZONES concerned;
c. The proceeds from fees, charges and other revenue-generatlng Instruments
which the PEZA is authorized to impose and collect under this Act;
d. The proceeds from bonds which the PEZA authorized to float both domestic
and abroad; and
e. The advance rentals, license fees, and other charges which the PEZA
is authorized to impose under this Act and which an investor is willing to
advance payment for.
SECTION 48. Applicability of National Laws.National laws shall prevail vis-a- vis
ECOZONE rules, regulations and standards, unless there is a clear intent in this Act
or other Acts of Congress to vest the ECOZONE specific power and privileges not
otherwise allowed under existing laws.
SECTION 49. Authority of the President to Advance Initial Funding.Subject to
existing laws, the President of the Philippines is hereby authorized to advance out of
the savings of the Office of the President such funds as may be necessary to effect the
organization of an ECOZONE which shall be reimbursed by the PEZA at reasonable
term and condition.
SECTION 50. Non-Applicability on Areas Covered by Republic Act. No. 7227.This
Act shall not be applicable to economic zones and areas already created or to be
created under Republic Act No. 7227 or other special laws, and governed by authorities
constituted pursuant thereto.
SECTION 51.Ipso-Facto Clause.All privileges, benefits, advantages or exemptions
granted to special economic zones under Republic Act. No. 7227, shall ipso-facto be
accorded to special economic zones already created or to be created under this Act.
The free port status shall not be vested upon new special economic zones.
SECTION 52.Separability Clause.The provisions of this Act are hereby declared
separable, and in the event one or more of such provisions or part thereof are declared
unconstitutional, such declaration of unconstitutionality shall not affect the validity of
the other provisions thereof.

Laws on Bases Conversion

82

ECONOMIC ZONES - Republic Act No. 7916

SECTION 53. Interpretation / Construction.The powers, authorities and functions


that are vested In the Philippine Economic Zone Authority (PEZA) and the ECOZONES
concerned are intended to establish decentralization of governmental functions
and authority as well as an efficient and effective working relationship between the
ECOZONE, the central government and the local government units.
SECTION 54. Repealing Clause.All laws, acts, presidential decrees, executive
orders, proclamations and / or administrative regulations which are inconsistent with
the provisions of this Act, are hereby amended, modified, superseded or repealed
accordingly.
SECTION 55. Implementing Rules and Regulations.The Department of Trade and
Industry, the National Economic and Development Authority, the Department of
Finance, the Bureau of Customs, the Department of Agrarian Reform, the Department
of Interior and local Government, the Philippine Economic Zone Authority, and the
representatives from the technical staff of the Committee on Economic Affairs of both
Houses of Congress shall formulate the implementing rules and regulations of this Act
within ninety (90) days after its approval. Such rules and regulations shall take effect
fifteen (15) days after their publication in a newspaper of general circulation in the
Philippines.
SECTION 56. Transitory Provisions.Prior to the effectivity of the implementing rules
and regulations of this Act, the provisions of Presidential Decree No. 66, as amended,
and its implementing rules and regulations shall remain in force.
SECTION 57. EffectivityThis Act shall take effect upon its approval.
Approved:

(Sgd.) EDGARDO J. ANGARA


President of the Senate

83

(Sgd.) JOSE DE VENECIA, JR.


Speaker of the
House of Representatives

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 7916

This Act, which is a consolidation of House Bill No. 14295 and Senate Bill No. 1061
was finally passed by the House of Representatives and the Senate on February 21,
1995.

(Sgd.) EDGARDO E. TUMANGAN


Secretary of the Senate

(Sgd.) CAMILO L. SABIO


Secretary General
House of Representative

Approved:

(Sgd.) FIDEL V. RAMOS


President of the Philippines

Laws on Bases Conversion

84

ECONOMIC ZONES - Republic Act No. 8748

Republic Act No. 8748


An Act of Amending Republic Act No. 7916, Otherwise Known
Special Economic Zone Act of 1995

as the

Be it enacted by the Senate and House of Representatives of the Philippines in Congress


assembled:
Section 1. Chapter II, Section 11 of Republic Act No. 7916 is hereby amended to read
as follows:
"Section 11. The Philippine Economic Zone Authority (PEZA) Board. There is
hereby created a body corporate to be known as the Philippine Economic Zone
Authority (PEZA) attached to the Department of Trade and Industry. The Board
shall have a director general with the rank of department undersecretary who shall
be appointed by the President. The director general shall be at least forty (40)
years of age, of proven probity and integrity, and a degree holder in any of the
following fields: economics, business, public administration, law, management
or their equivalent, and with at least ten (10) years relevant working experience
preferably in the field of management or public administration.
"The director general, shall be assisted by three (3) deputy directors general each
for policy and planning, administration and operations, who shall be appointed
by the PEZA Board, upon the recommendation of the director general. The deputy
directors general shall be at least thirty-five (35) years old, with proven probity and
integrity and a degree holder in any of the following fields: economics, business,
public administration, law, management or their equivalent.
"The Board shall be composed of thirteen (13) members as follows: the Secretary
of the Department of Trade and Industry as Chairman, the Director General of
the Philippine Economic Zone Authority as Vice-chairman, the undersecretaries
of the Department of Finance, the Department of Labor and Employment, the
Department of Interior and Local Government, the Department of Environment
and Natural Resources, the Department of Agriculture, the Department of Public
Works and Highways, the Department of Science and Technology, the Department
of Energy, the Deputy Director General of the National Economic and Development
Authority, one (1) representative from the labor sector, and one (1) representative
from the investors/business sector in the ECOZONE. In case of the unavailability of
the Secretary of the Department of Trade and Industry to attend a particular board
meeting, the Director General of PEZA shall act as Chairman."
xxx
Section 2. Chapter II, Section 15 of Republic Act No. 7916 is likewise amended to
read as follows:

85

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 8748

"Section 15. Administration of Each ECOZONE. Except for privately-owned,


managed or operated ECOZONES, each ECOZONE shall be organized,
administered, managed and operated by the ECOZONE executive committee
composed of the following:
xxx xxx xxx
"Privately-owned ECOZONES shall retain autonomy and independence but shall
be monitored by the PEZA for the implementation of incentives and operations for
adherence to the law."
Section 3. Chapter II, Section 16 of Republic Act No. 7916 is likewise amended to
read as follows:
"Section 16. Personnel. The PEZA Board of Directors shall provide for
an organization and staff of officers and employees of the PEZA, and upon
recommendation of the director general with the approval of the Secretary of the
Department of Trade and Industry, appoint and fix the remunerations and other
emoluments: provided, that the Board shall have exclusive and final authority to
promote, transfer, assign or reassign officers of the PEZA, any provision of existing
law to the contrary notwithstanding: provided, further, that the director general
may carry out removal of such officers and employees.
"All positions in the PEZA shall be governed by a compensation, position
classification system and qualification standards approved by the director general
with the concurrence of the Board of Directors based on a comprehensive job
analysis and audit of actual duties and responsibilities. The compensation plan
shall be comparable with the prevailing compensation plans in the Subic Bay
Metropolitan Authority (SBMA), Clark Development Corporation (CDC), Bases
Conversion and Development Authority (BCDA) and the private sector and shall
be subject to periodic review by the Board no more than once every two (2) years
without prejudice to yearly merit reviews or increases based on productivity and
profitability. The PEZA shall thereforee be exempt from existing laws, rules and
regulations on compensation, position classification and qualification standards. It
shall however endeavor to make its system conform as closely as possible with the
principles under Republic Act No. 6758.
"The PEZA officers and employees including all Members of the Board shall not
engage directly or indirectly in partisan activities or take part in any election,
except to vote.
"No officer or employee of the PEZA subject to Civil Service laws and regulations
shall be removed or suspended except for cause, as provided by law."

Laws on Bases Conversion

86

ECONOMIC ZONES - Republic Act No. 8748

Section 4. Chapter III, Section 24 of Republic Act No. 7916 is hereby amended to
read as follows:
"Section 24. Exemption from National and Local Taxes. Except for real property
taxes on land owned by developers, no taxes, local and national, shall be imposed
on business establishments operating within the ECOZONE. In lieu thereof, five
percent (5%) of the gross income earned by all business enterprises within the
ECOZONE shall be paid and remitted as follows:
a. "Three percent (3%) to the National Government;
b. "Two percent (2%) which shall be directly remitted by the business
establishments to the treasurer's office of the municipality or city where
the enterprise is located."
Section 5. Chapter III, Section 25 of Republic Act No. 7916 is hereby amended to
read as follows:
"Section 25. Applicable National and Local Taxes. All persons and service
establishments in the ECOZONE shall be subject to national and local taxes under
the National Internal Revenue Code and the Local Government Code."
Section 6. Chapter III, Section 29 of Republic Act No. 7916, is hereby amended to
read as follows:
"Section 29. Eminent Domain. x x x
"If in the establishment of a publicly-owned ECOZONE, any person or group
of persons who has been occupying a parcel of land within the Zone has to
be evicted, the PEZA shall provide the person or group of persons concerned
with proper disturbance compensation: provided, however, that in the case of
displaced agrarian reform beneficiaries, they shall be entitled to the benefits under
the Comprehensive Agrarian Reform Law, including but not limited to Section
36 of Republic Act No. 3844, in addition to a homelot in the relocation site, and
preferential employment in the project being undertaken."
Section 7. Chapter VI, Section 50 of Republic Act No. 7916 is hereby amended to
read as follows:

87

"Section 50. Non-Applicability on Areas Covered by Republic Act No. 7227.


This Act shall not be applicable to economic zones and areas already created or to
be created under Republic Act No. 7227 or other special laws, and governed by
authorities constituted pursuant thereto."

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 8748

Section 8. Effectivity Clause. This Act shall take effect after fifteen (15) days
following its publication in the Official Gazette or in two (2) newspapers of general
circulation whichever comes earlier.
Approved, June 1, 1999.

(Sgd.) JOSEPH EJERCITO ESTRADA


President of the Philippines

Laws on Bases Conversion

88

ECONOMIC ZONES - Republic Act No. 9399

Republic Act No. 9399


An Act Declaring a One-Time Amnesty on Certain Tax and Duty Liabilities,
Inclusive of Fees, Fines, Penalties, Interests and Other Additions Thereto,
Incurred by Certain Business Enterprises Operating Within the Special Economic
Zones and Freeports Created Under Proclamation No. 163, Series of 1993;
Proclamation No. 216, Series of 1993; Proclamation No. 420, Series of 1994;
and Proclamation No. 984, Series of 1997, Pursuant to Section 15 of Republic
Act No. 7227, as Amended, and for Other Purposes
Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:
SECTION 1. GRANT OF TAX AMNESTY.Registered business enterprises operating
prior to the effectivity of this Act within the special economic zones and freeports
created pursuant to Section 15 of Republic Act No. 7227, as amended, such as the
Clark Special Economic Zone created under Proclamation No. 163, series of 1993;
Poro Point Special Economic and Freeport Zone created under Proclamation No. 216,
series of 1993; John Hay Special Economic Zone created under Proclamation No.
420, series of 1994; and Morong Special Economic Zone created under Proclamation
No. 984, series of 1997, may avail themselves of the benefits of remedial tax amnesty
herein granted on all applicable tax and duty liabilities, inclusive of fines, penalties,
interests, and other additions thereto, incurred by them or that might have accrued
to them due to the rulings of the Supreme Court in the cases of John Hay Peoples
Coalition v. Lim, et.al., G.R. No. 119775 dated 23 October 2003 and Coconut Oil
Refiners Association, Inc., v. Torres, et.al., G.R. No. 132527 dated 29 July 2005, by
filing a notice and return in such form as shall be prescribed by the Commissioner
of Internal Revenue and the Commissioner of Customs and thereafter, by paying an
amnesty tax of Twenty-five thousand pesos (P25,000.00) within six months from
the effectivity of this Act: Provided, That the applicable tax and duty liabilities to be
covered by the tax amnesty shall refer only to the difference between: (i) all national
and local tax impositions under relevant tax laws, rules and regulations; and (ii) the
five percent (5%) tax on gross income earned by said registered business enterprises as
determined under relevant revenue regulations of the Bureau of Internal Revenue and
memorandum circulars of the Bureau of Customs during the period covered: Provided,
however, That the coverage of the tax amnesty herein granted shall not include the
applicable taxes and duties on articles, raw materials, capital goods, equipment and
consumer items removed from the special economic zone and freeport and entered
in the customs territory of the Philippines for local or domestic sale, which shall be
subject to the usual taxes and duties prescribed in the National Internal Revenue Code
(NIRC) of 1997, as amended, and the Tariff and Customs Code of the Philippines, as
amended.

89

Laws on Bases Conversion

ECONOMIC ZONES - Republic Act No. 9399

SECTION 2. IMMUNITIES AND PRIVILEGES.Those who have availed themselves


of the tax amnesty and have fully complied with all its conditions shall be relieved
of any civil, criminal and/or administrative liabilities arising from or incident to the
nonpayment of taxes, duties and other charges covered by the tax amnesty granted
under Section 1 herein.
SECTION 3. IMPLEMENTING RULES AND REGULATIONS.The Department of
Finance, in coordination with the Bureau of Internal Revenue and the Bureau of
Customs, and in consultation with the Bases Conversion and Development Authority,
the Clark Development Corporation, the John Hay Management Corporation, the Poro
Point Management Corporation and the Bataan Technology Park, Inc., shall promulgate
and publish the necessary rules and regulations for the effective implementation of this
Act within two months from the date of effectivity of this Act.
SECTION 4. SEPARABILITY CLAUSE.If any portion or provision of this Act is declared
unconstitutional, the remainder of this Act or any provision not affected thereby shall
remain in force and effect.
SECTION 5. REPEALING CLAUSE.All laws, decrees, orders, rules and regulations or
other issuances or parts thereof inconsistent with the provisions of this Act are hereby
repealed or modified accordingly.
SECTION 6. EFFECTIVITY.This Act shall take effect fifteen (15) days after its
publication in the Official Gazette or in any two newspapers of general circulation,
whichever comes earlier.
Approved,

(Sgd.) MANNY VILLAR




President of the Senate

Laws on Bases Conversion

(Sgd.) JOSE DE VENECIA, JR.


Speaker of the
House of Representatives

90

ECONOMIC ZONES - Republic Act No. 9399

This Act which is a consolidation of House Bill No. 4900 and Senate Bill No. 2259 was
finally passed by the House of Representatives and the Senate on January 31, 2007 and
February 5, 2007, respectively.

(Sgd.) OSCAR G. YABES




Secretary of the Senate

(Sgd.) ROBERTO P. NAZARENO


Secretary General
House of Representatives

Approved: March 20, 2007

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines

91

Laws on Bases Conversion

CLARK FREEPORT ZONE - Proclamation No. 163

Proclamation No. 163


Creating and Designating the Area Covered by the Clark Special Economic Zone
and Transferring these Lands to the Bases Conversion and Development Authority
Pursuant to Republic Act No. 7227
Pursuant to the powers vested in me by law and the resolutions of concurrence of the
local government units directly affected, I, FIDEL V. RAMOS, President of the Republic
of the Philippines, hereby create and designate the area covered by the Clark Special
Economic Zone (CSEZ) comprising the lands occupied by the Clark military reservations
and its contiguous extensions as embraced, covered, and defined by the 1947 Military
Bases Agreement between the Philippines and the United States of America, as amended,
located within the territorial jurisdiction of Angeles City, Municipalities of Mabalacat
and Porac, Province of Pampanga, and the Municipality of Capas, Province of Tarlac,
as follows:
SECTION 1. CREATION OF THE CLARK SPECIAL ECONOMIC ZONE.The CSEZ
shall cover the lands consisting of the Clark military reservations, including the
Clark Air Base proper and portions of the Clark reverted baselands, and excluding
the areas covered by previous Presidential Proclamations, the areas turned over to
the Department of Agrarian Reform (DAR), and the areas in the reverted baselands
reserved for military use.
Specifically, the areas covered by the CSEZ and the areas excluded are as follows:










I. AREAS COVERED BY THE CSEZ


APPROXIMATE AREA
1. Clark Air Base proper
4,400 Hectares
2. Portions of Clark Reverted Baselands
a. Zone A
7,205
b. Zone B (Net of ODonnell Transmitter
Station and Resettlement Area
under Proclamation No. 813)
3,052
c. Zone D (Net of Sacobia Area
and Resettlement Area under
Proclamation No. 812)
13,344
Sub-Total
23,601
TOTAL CSEZ AREA
28,041 Hectares
II. AREAS IN THE REVERTED BASELANDS EXCLUDED FROM
THE CLARK SEZ:

1. For the Pinatubo Commission


Resettlement Sites in Zones B and D
a. Under Proclamation No. 812
(11 October 1991)
b. Under Proclamation No. 813
(11 October 1991)

Laws on Bases Conversion

122 Hectares

348

92

CLARK FREEPORT ZONE - Proclamation No. 163

2. For the Sacobia Development Authority


Resettlement Project in Zone D Under
Proclamation No. 1955 (25 March 1980)

5,612

3. For DND/Military Use:


a. O Donell Transmitter Station
b. O Donell Excepted Area
c. Zone C (Crow Valley)

370
1,755
17,847

4. For the Department of Agrarian Reform (DAR):


a. Zone E
7,006
b. Zone F
1,749
c. Zone G
1,969

TOTAL EXCLUDED AREAS

36,778 Hectares

The total area of the CSEZ is 28,041 hectares, more or less, subject to actual survey,
covering Clark Air Base proper (4,440 has.) and portions of the Clark reverted baselands
(23,601 has.).
SECTION 2. TRANSFER OF CSEZ AREAS TO THE BASES CONVERSION AND
DEVELOPMENT AUTHORITY.The Clark Air Base proper covering 4,440 hectares,
more or less, and portions of the Clark reverted baselands covering 23,601 hectares,
more or less, totalling 28,041 hectares declared as the total area of the CSEZ in
accordance with Section 1 hereof are hereby transferred to the BCDA.
These areas are approximate and subject to actual ground surveys.
The BCDA shall determine utilization and disposition of the above mentioned lands.
SECTION 3. GOVERNING BODY OF THE CLARK SPECIAL ECONOMIC ZONE.
Pursuant to Section 15 of R.A. 7227, the BCDA is hereby established as the governing
body of the CSEZ. The BCDA shall promulgate all necessary policies, rules and
regulations to govern and regulate the CSEZ thru the operating and implementing arm
it shall establish for the CSEZ.
SECTION 4. MEMORANDA OF AGREEMENTS.The areas inside the Clark Air Base
proper intended for use by the military, by the Mt. Pinatubo Assistance, Resettlement
and Development Commission, by the University of the Philippines (U.P.) and other
institutions, if any, shall be delineated and covered by separate Memoranda of
Agreements to be agreed upon and entered into by the BCDA and DND/AFP, the
Pinatubo Commission, the U.P. and the other institutions, subject to the final approval
of the President.

93

Laws on Bases Conversion

CLARK FREEPORT ZONE - Proclamation No. 163

This Proclamation shall take effect immediately.


DONE in the City of Manila, this 3rd day of April in the year of Our Lord, Nineteen
Hundred and Ninety-Three.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:

ANTONIO T. CARPIO
Chief Presidential Legal Counsel

Laws on Bases Conversion

94

CLARK FREEPORT ZONE - Executive Order No. 80

Executive Order No. 80


Authorizing the Establishment of the Clark Development Corporation
as the Implementing Arm of the Bases Conversion and Development Authority
for the Clark Special Economic Zone, and Directing All Heads of Departments,
Bureaus, Offices, Agencies and Instrumentalities of Government
to Support the Program
WHEREAS, the national leadership notes with deep concern the magnitude of the
economic and social problems in Central Luzon, particularly in the City of Angeles,
and the Municipalities of Mabalacat, Porac, Bamban and Capas, as a result of the Mt.
Pinatubo eruptions and the withdrawal of the US Military Forces from Clark Air Base,
and the need to address this immediate concern by way of providing employment and
livelihood opportunities and resettlement and relocation sites;
WHEREAS, it is the policy of the Government to accelerate the sound and balanced
conversion of the Clark military reservations and its contiguous extensions into
alternative productive civilian uses to promote the economic and social development
of Central Luzon in particular and the country in general.
WHEREAS, the Bases Conversion and Development Authority (BCDA) is mandated
by Republic Act No. 7227 (RA 7227), otherwise known as the Bases Conversion and
Development Act of 1992, to adopt, prepare and implement a comprehensive and
detailed plan for the conversion of the Clark military reservations and its contiguous
extensions consistent with the plans and programs of the national and local governments;
WHEREAS, it is envisioned that Clark will be converted into an international civil
aviation complex, a modern industrial estate and tourism, trade and business center
for Luzon and Asia;
WHEREAS, the national leadership is cognizant of the vital role of the private sector and
the local government units in the Clark conversion program.
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines,
by virtue of the powers vested in me by the Constitution, do hereby order the following:
SECTION 1. CREATION OF THE CLARK DEVELOPMENT CORPORATION.A
body corporate to be known as the Clark Development Corporation (CDC) is hereby
authorized to be formed as the operating and implementing arm of the BCDA to
manage the Clark Special Economic Zone (CSEZ).
The CDC shall be a subsidiary corporation of the BCDA and shall be formed in
accordance with the Philippine Corporation Law and existing rules and regulations
promulgated by the Securities and Exchange Commission pursuant to Section 16 of
RA 7227.

95

Laws on Bases Conversion

CLARK FREEPORT ZONE - Executive Order No. 80

The CDC shall be subject to the policies, rules and regulations of the BCDA for the
CSEZ.
SECTION 2. POWERS AND FUNCTIONS OF THE CLARK DEVELOPMENT
CORPORATION.The BCDA, as the incorporator and holding company of its Clark
subsidiary, shall determine the powers and functions of the CDC. Pursuant to Section
15 of RA 7227, the CDC shall have the specific powers of the Export Processing Zone
Authority as provided for in Section 4 of Presidential Decree No. 66 (1972) as amended.
SECTION 3. BOARD OF DIRECTORS.The powers of the CDC shall be vested in
and exercised by a Board of Directors (Board) which shall be composed of eleven
(11) members each of whom shall be a stockholder of the CDC: Provided, That, the
composition of the CDC Board is subject to the provisions of Section 16 of RA 7227.
The members of the Board representing the equity or capital stock in CDC of BCDA
and other national government agencies shall be nominated by the President.
No person shall be nominated as a member of the Board representing national
government capital stocks in CDC unless he is a Filipino citizen, of good moral
character, and of recognized competence in relevant fields including but not limited
to economics, management, international relations, law or engineering. Preference in
the designation of the members of the Board shall be given to residents within the local
government units that concur to join the CSEZ.
SECTION 4. CAPITALIZATION.The capitalization of CDC shall be determined by
its incorporators and holding company, the BCDA, which shall include the following:
4.1 Cash equity provided by the BCDA and other agencies and instrumentalities
of government;
4.2 Portions of or all of the lands embraced and covered by the CSEZ, as well as
permanent improvements and fixtures therein upon proper inventory; and
4.3 All other assets which the President may transfer to the CDC as part of the
equity contribution of the Government.
SECTION 5. INVESTMENT CLIMATE IN THE CSEZ.Pursuant to Section 5 (m) and
Section 15 of RA No. 7227, the BCDA shall promulgate all necessary policies, rules and
regulations governing the CSEZ, including investment incentives, in consultation with
the local government units and pertinent government departments for implementation
by the CDC.
Among others, the CSEZ shall have all the applicable incentives in the Subic Special
Economic and Free Port Zone under RA No. 7227 and those applicable incentives

Laws on Bases Conversion

96

CLARK FREEPORT ZONE - Executive Order No. 80

granted in the Export Processing Zones, the Omnibus Investments Code of 1987, the
Foreign Investments Act of 1991 and new investments laws which may hereinafter be
enacted.
The CSEZ Main Zone covering the Clark Air Base proper shall have all the aforecited
investment incentives, while the CSEZ Sub-Zone covering the rest of the CSEZ shall
have limited incentives. The full incentives in the Clark SEZ Main Zone and the limited
incentives in the Clark SEZ Sub-Zone shall be determined by the BCDA.
SECTION 6. LOCAL AUTONOMY.Except as herein provided, the affected local
government units shall retain their basic autonomy and identity. Angeles City shall
be governed by its charter and the Municipalities of Porac, Mabalacat, Bamban and
Capas shall operate and function in accordance with Republic Act No. 7160, otherwise
known as the Local Government Code of 1991. In case of conflict between the CDC
and the local government units concerned on matters affecting the CSEZ other than
defense and security, the decision of the CDC shall prevail.
SECTION 7. ROLE OF DEPARTMENTS, BUREAUS, OFFICES, AGENCIES AND
INSTRUMENTALITIES.All heads of departments, bureaus, offices, agencies and
instrumentalities of the government are hereby directed to give full support to the
Clark conversion program and to coordinate with the BCDA to facilitate the necessary
approvals to expedite the implementation of the various projects of the conversion
program.
SECTION 8. REPEALING CLAUSE.All presidential issuances, rules and regulations
or parts thereof which are inconsistent with the provisions of this Executive Order are
hereby repealed, amended or modified accordingly.
SECTION 9. EFFECTIVITY.This Executive Order shall take effect immediately.
DONE in the City of Manila, this 3rd day of April in the year of Our Lord, Nineteen
Hundred and Ninety-Three.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:

(Sgd.) ANTONIO T. CARPIO


Chief Presidential Legal Counsel

97

Laws on Bases Conversion

CLARK FREEPORT ZONE - Proclamation No. 1035

Proclamation No. 1035


Creating and Designating Certain Parcels of Land of the Public Domain
Situated at Angeles City, Municipalities of Mabalacat and Porac, Pampanga
and the Municipalities of Capas and Bamban, Tarlac as
a Special Economic Zone Pursuant to Republic Act No. 7916
as Amended by Republic Act No. 8748
Pursuant to the powers vested in me under Republic Act No. 7916, otherwise known as
the Special Economic Zone Act of 1995 as amended and upon recommendation of the
Board of Directors of the Philippine economic Zone Authority, I, GLORIA MACAPAGAL
- ARROYO, President of the Philippines, do hereby create and designate, subject to
the provisions of Republic Act No. 7916, as amended, its Implementing Rules and
Regulations, and Resolution No. 06-036 dated 15 February 2006 of the Board of
Directors of the Philippine Economic Zone Authority, an area located at Angeles City,
Municipalities of Mabalacat and Porac, Pampanga and the Municipalities of Capas
and Bamban, Tarlac, as a special economic zone, consisting of THREE HUNDRED
THIRTY SEVEN MILLION SIX HUNDRED FIFTY THOUSAND (337, 650, 000)
SQUARE METERS, as contained in the following Presidential Proclamations:
PROCLAMATION 163
CREATING AND DESIGNATING THE AREA COVERED BY THE CLARK SPECIAL
ECONOMIC ZONE AND TRANSFERRING THESE LANDS TO THE BASES
CONVERSION AND DEVELOPMENT AUTHORITY PURSUANT TO REPUBLIC ACT
NO. 7227
Pursuant to the powers vested in me by law and the resolutions of concurrence of the
local government units directly affected, I Fidel V. Ramos, President of the Republic
of the Philippines, hereby create and designate the area covered by the Clark Special
Economic Zone (CSEZ) comprising the lands occupied by the Clark military reservations
and its contiguous extensions as embraced, covered and defined by the 1947 Military
Bases Agreement between the Philippines and the United States Of America, as
amended, located within the Mabalacat and Porac, Pampanga, and the Municipalities
of Capas, Tarlac, as follows:
Section 1. Creation of the Clark Special Economic Zone. The CSEZ shall coverthe
lands consisting of the Clark Military reservations, including the Clark Air Base proper
and the portions of the Clark reverted baselands, and excluding the areas in the reverted
baselands reserved for military use.

Laws on Bases Conversion

98

CLARK FREEPORT ZONE - Proclamation No. 1035

Specifically, the areas covered by the CSEZ and the areas excluded are as follows:
I. AREAS COVERED BY THE CSEZ
1. Cark Air Base Proper

APPROXIMATE AREA

4,440 Hectares

2. Portion of Clark Reverted Baselands


a. Zone A




7,205
b. Zone B (Net of ODonnell 3,052
Transmitter Station and Resettlement
Under Proclamation No. 813)
c. Zone C (Net of Sacobia Area and 13,334
Resettlement Area under Proclamation No.
812)
Sub-Total

23,601

Total CSEZ Area

28,041 Hectares

II. AREAS IN THE REVERTED BASELANDS EXCLUDED FROM THE CLARK SEZ:
1. For the Pinatubo Commission Resettlement Sites in Zones B & D
a. Under Proclamation No. 812

122 Hectares
(11 October 1991)
b. Under Proclamation No. 813

348
(11 October 1991)
2. For the Sacobia Development Authority
Resettlement Project in Zone D
Under Proclamation No. 1955
(25 March 1980)
3. For DND/Military Use:
a. ODonnell Transmitted Station
b. ODonnell Excepted area

c. Zone C (Crow Valley)

5,612

370
1,755
17,847

4. For the Department of Agrarian Reform (DAR)


a. Zone E




b. Zone F




c. Zone G



7,006
1,749
1,969

The total area of the CSEZ is 28,041 hectares, more or less, subject to actual survey,
covering Clark Air Base proper (4,440 hectares) and portions of Clark reverted
baselands (23,601 hectares).

99

Laws on Bases Conversion

CLARK FREEPORT ZONE - Proclamation No. 1035

Section 2. Transfer of CSEZ Areas to the Bases Conversion and Development Authority.
The Clark Air Base proper covering 4,440 hectares, more or less, and portions of
the Clark reverted baselands covering 23,601 hectares, more or less, totalling 28,041
hectares declared as the total area of the CSEZ in accordance with Section 1 hereof are
hereby transferred to the BCDA.
These areas are approximate and subject to actual ground surveys.
The BCDA shall determine utilization and disposition of the above mentioned lands.
Section 3. Governing Body of the Clark Special Economic Zone. Pursuant to Section
15 of R.A. 7227, the BCDA is hereby established as the governing body of the CSEZ.
The BCDA shall promulgate all necessary policies, rules and regulations to govern and
regulate the CEZ thru the operating and implementing arm it shall establish for the
CSEZ.
Section 4. Memoranda of Agreements. The areas inside the Clark Air Base proper
intended for the use of the military, by the Mt. Pinatubo Assistance, resettlement
and development Commission, by the University of the Philippines (U.P.) and other
institutions, if any shall be delineated and covered by separate Memoranda of
Agreements to be agreed upon and entered into by the BCDA and DND/AFP, the
Pinatubo Commission, the U.P. and other institutions, subject to the final approval of
the President.
This Proclamation shall take effect immediately.
Done in the City of Manila, this 3rd day of April in the year of our Lord, Nineteen
Hundred and Ninety-Three.

(Sgd.) GLORIA MACAPAGAL-ARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

Laws on Bases Conversion

100

CLARK FREEPORT ZONE - Proclamation No. 805

Proclamation No. 805


Redefining the Clark Special Economic Zone to Include therein
the Five Thousand Seven Hundred Twenty Four (5,724) hectares property
in the Municipalities of Bamban, Tarlac and Mabalacat, Pampanga
more commonly known as Sacobia
WHEREAS, Republic Act No. 7227, otherwise known as the Bases Conversion and
Development Act of 1992, created the Bases Conversion and Development Authority
(BCDA) to accelerate the sound and balanced conversion of the Clark and Subic
Military reservations and their extensions into alternative productive uses and promote
the economic and social development of Central Luzon, in particular, and the country
in general;
WHEREAS, pursuant to Section 15 of Republic Act No. 7227, the President issued
Presidential Proclamation No. 163, s. of 1993, which created the Clark Special
Economic Zone (CSEZ) and defined its extent;
WHEREAS, Executive Order No. 80, s. of 1993, created the Clark Development
Corporation (CDC) to be the implementing and operating arm of the BCDA to manage
the CSEZ;
WHEREAS, part of the former Clark Air Base Military Reservation, which reverted to
the Philippine Government in 1979, is a vast land comprising approximately of five
thousand seven hundred twenty four (5,724) hectares covering the municipalities of
Bamban, Tarlac and Mabalacat, Pampanga, more commonly known as Sacobia;
WHEREAS, CDC's development objectives for communities around the former Clark
Air Base area is in consonance with the Sacobia Development Authority's (SDA)
specific objectives as identified in Executive Order No. 586, s. of 1980;
WHEREAS, to alleviate the economic situation of the communities in Sacobia and in
response to the clamor of investors to open up the area for agri-business activities, the
CDC envisions Sacobia to be the food basin for the CSEZ, the Central Luzon region,
and the country in general with its abundant produce feeding other parts of the world
to generate dollars for our economy;
WHEREAS, investors have shown strong interest to infuse capital for the development
of Sacobia once it is included in the CSEZ and put under the management, operation,
and control of the CDC since the latter can offer incentives and attractions for business
and entrepreneurship;
WHEREAS, the Province of Tarlac and the Municipalities of Bamban, Tarlac and
Mabalacat, Pampanga, through Resolutions of their respective Provincial and Municipal
Boards, signified their concurrence to have the Sacobia area included in the CSEZ;

101

Laws on Bases Conversion

CLARK FREEPORT ZONE - Proclamation No. 805

WHEREAS, Sacobia, once included in the CSEZ, will enjoy the incentives and
privileges granted to the CSEZ thereby ensuring the development of the area through
active participation of private investors and entrepreneurs and the attainment of the
basic goals and objectives for Sacobia and its communities;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines,
by virtue of the powers vested in me by law and the sovereign will of the people, do
hereby include in the Clark Special Economic Zone the five thousand seven hundred
twenty four (5,724) hectare portion located in the municipalities of Mabalacat,
Pampanga and Bamban, Tarlac, more commonly known as Sacobia, which parcels
of land, subject to the final survey and delineation on the ground by the Department
of Environment and Natural Resources (DENR), are described and defined in Survey
No. SWO-03-000083 of the DENR, Region III, Land Management Sector. Further,
vested rights and valid ancestral domain claims within the Sacobia area as verified and
validated by the DENR and other pertinent government agencies shall be respected.
IN WITNESS WHEREOF, I have hereunto set my hand and caused the seal of the
Republic of the Philippines to be affixed. cd
DONE in the City of Manila, this 14th day of June, in the year of Our Lord, Nineteen
Hundred and Ninety-Six.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:

(Sgd.) RUBEN D. TORRES


Executive Secretary

Laws on Bases Conversion

102

CLARK FREEPORT ZONE - Executive Order No. 464

Executive Order No. 464


Governing the Admission and Stay of Foreign Nationals
Clark Special Economic Zone as Temporary Visitors

in the

WHEREAS, it is a declared national policy to attract and promote foreign trade,


investment and tourism in the country especially in the special economic zones such
as the Clark Special Economic Zone ("EcoZone") to promote economic growth and
national development;
WHEREAS, it is expected that visits to the Clerk EcoZone by foreign nationals for
business, tourism and recreation purposes will increase significantly due to the
development and the growing attraction of the Clark EcoZone as an investment,
tourism, recreational and industrial destination;
WHEREAS, the Clark International Airport has likewise attracted interest from
international airlines as a destination point for chartered and commercial flights which
will contribute immensely to the development of the Clark EcoZone, the Central Luzon
Region, the entire Philippines and ultimately the entire Asian Region;
WHEREAS, it is crucial to allow uncomplicated access to the Secured Area of the Clark
EcoZone as defined in relevant issuances for foreign nationals in order to realize the
above-declared national policy. lawphi1.net
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Philippines, by virtue of the
powers vested in me by law, do hereby order:
Section 1. Foreign national, not categorized as "restricted" as determined by the DFA,
visiting the Clark EcoZone for business and/or tourism purposes may be allowed to
enter all ports of entry of the Clark ECOZONE and stay therein without visa for a
maximum period of fourteen (14) days: Provided, That upon arrival, they present their
passports, Certificates of Identity or travel documents valid for at least six (6) months
beyond the intended stay in the Clark EcoZone and confirmed onward flight tickets.
The determination of the identity and admissibility of the foreign national seeking to
enter the Clark EcoZone under this Executive Order shall be the primary responsibility
of the Bureau of Immigration (BI).
Section 2. Foreign nationals who enter the Clark EcoZone under this Executive Order
shall be subject to the following restrictions:
a. They shall leave or depart from the Philippines only through the Clark
International Airport except as hereinafter provided;
b. They shall not be allowed outside the Secured Area of the Clark EcoZone,
except to visit areas outside the Secured Area but within the Clark EcoZone;

103

Laws on Bases Conversion

CLARK FREEPORT ZONE - Executive Order No. 464

Provided, That they are escorted by BI officers and/or Clark Development


Corporation (CDC) officers duly deputized by the BI;
c. Those who intend to visit areas outside the Clark EcoZone at any given time
and/or extend their stay in the Clark EcoZone for any reason beyond the 14 day
period must secure a visa waiver from the Department of Foreign Affairs (DFA);
Provided, That upon securing such visa waiver, the restrictions as provided
herein shall no longer be applicable.
Section 3. The head of the CDC may, in case of extreme emergencies or under
exceptional circumstances, allow foreign nationals who enter the Clark EcoZone under
this Executive Order to visit areas outside the Clark EcoZone under special permit or
escort, subject to confirmation of visa waiver by the DFA.
Section 4. The DFA, BI and CDC shall jointly implement this Executive Order by
issuing appropriate guidelines and circulars. They are hereby authorized to collect
reasonable fees for processing of non-visa entry and application for visa waivers.
Section 5. Any foreign national who violates the provisions of this Executive Orders
or its implementing guidelines and circulars shall be subject to appropriate sanctions
under existing Philippine immigration laws.
Section 6. The privileges accorded hereunder shall not in any way impair more
favorable no-visa privileges accorded to foreign nationals under any existing executive
order, letter of instruction, administrative order or issuance.
Section 7. All previous executive orders, letters of instruction, administrative orders
and/or similar issuances inconsistent with this Executive Order are hereby repealed,
amended or modified accordingly. lawphi1.net
Section 8. Special Clark Investors/Working Visas issued by the CDC in coordination
with the BI shall be deemed regular visas valid for entry and exit in the Philippine ports
of entry. lawphi1.net
Section 9. This Executive Order shall take effect immediately after publication in a
newspaper of general circulation.
DONE in the City of Manila, this 26th day of January, in the year of Our Lord. nineteen
hundred and ninety-eight.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
Laws on Bases Conversion

By the President:
(Sgd.) ALEXANDER P. AGUIRRE
Acting Executive Secretary

104

CLARK FREEPORT ZONE - Executive Order No. 7

Executive Order No. 7


Authorizing the Merger of Clark Development Corporation
Clark International Airport Corporation

and

WHEREAS, Republic Act No. 7227 mandated the Bases Conversion Development
Authority (BCDA) to adopt, prepare and implement a comprehensive and detailed plan
for the sound and balanced conversion of the Clark and Subic military reservations and
their extensions;
WHEREAS, Executive Order No. 80, series of 1993, established Clark Development
Corporation (CDC) as the implementing arm of BCDA for the Clark Special Economic
Zone which envisioned Clark to be converted into an international civil aviation comp,
a modern industrial estate and tourism, trade and business center for Luzon and Asia;
WHEREAS, Executive Order No. 360, amending Executive Order No. 192, provided
that Clark International Airport Corporation (CIAC) shall be a wholly-owned subsidiary
of BCDA to operate and manage the Clark Aviation Comp;
WHEREAS, in the course of the development of the Clark Special Economic Zone,
CDC and CIAC have been observed to be competing with each other and pursuing
their policies and operations without coordination and, at times, in an inconsistent
manner;

WHEREAS, to address the unproductive competition and overlapping functions
between the CDC and CIAC, the BCDA proposes the merger of the two corporations,
with the CDC as the surviving corporation;
WHEREAS, the proposed merger would mean a P50 to 60 million savings for the
government.
Section 1. The merger of CDC and CIAC is hereby authorized subject to the provisions
of the Corporation Code.
Section 2. The Chairman of the BCDA is directed to prepare a plan and take all
the necessary steps towards effecting the merger of CDC and CIAC, with CDC as the
surviving corporation.
Section 3. The BCDA Chairman shall submit a report to the President on the action
taken as soon as the merger shall have been completed.

105

Laws on Bases Conversion

CLARK FREEPORT ZONE - Executive Order No. 7

Section 4. All orders, rules and regulations, or parts thereof which are inconsistent
with this Executive Order are hereby repealed, amended or modified accordingly.
Section 5. This Executive Order shall take effect immediately.
DONE in the City of Manila, this 26th day of March, in the year of Our Lord, Two
Thousand and One.

(Sgd.) GLORIA MACAPAGAL-ARROYO


President of the Philippines
By the President:

(Sgd.) RENATO S. DE VILLA


Executive Secretary

Laws on Bases Conversion

106

CLARK INTERNATIONAL AIRPORT - Executive Order No. 174

Executive Order No. 174


Designation of Clark Special Economic Zone (Clark Field)
as the Future Site of a Premiere Philippine International Airport
WHEREAS, the recent IATA forecast indicates that more than 376 million enplanements
(51.1% of world total) will be in the Asia-Pacific by the year 2010, a fourfold increase
from 1990;
WHEREAS, Asian countries have already embarked on ambitious airport infrastructure
development and expansion projects to alleviate congestion in airspace, runways and
terminals, and to keep pace with rapid economic development;
WHEREAS, the conversion development program of the Bases Conversion and
development Authority (BASECON) for the former Clark air Base revolves around the
establishment of an international aviation complex that will involve the expansion of
existing aviation facilities into world class and globally competitive standards;
WHEREAS, Clark air Base with its existing runways and airport area of 2,200 hectares
provides sufficient area for phased expansion to serve the air traffic demand of the 21st
century;
WHEREAS, with the Philippine centennial celebrations scheduled at Clark by 1998,
the airport complex must be operational by the fourth quarter of 1997;
WHEREAS, the development of Clark Aviation Complex as a new international gateway
to the Philippines, together with its accompanying expressway and mass-transit rail
access systems will attract economic and tourism activities towards Central Luzon
and the North Luzon Growth Quadrangle, thereby relieving Metro Manila of further
increase in migration, congestion, pollution, traffic and other urban ills;
WHEREAS, the Bases Conversion and Development Authority (BCDA) and Clark
Development Corporation (CDC) have committed the establishment of an international
airport at Clark to its local and international lessors and investors;
WHEREAS, this new international airport is viewd by the international community,
particularly those in the Asia-Pacific group, as a clear and loud signal that the
Philippines is back in business;
WHEREAS, the national leadership is cognizant of the need to accelerate the
development of the countrys international airports, and has envisioned the former
Clark Air Base to be the site of a premier international airport, as well as of modern
industrial area and a center for investment, tourism, trade and business for Luzon and
Asia, as contemplated in Section 2.1.2 of Executive Order No. 62, Series of 1993;

107

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 174

NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines,


by virtue of the powers vested in me by law, do hereby order:
1. The designation of Clark Special economic Zone (Clark Field) as the future
site of a premier International Airport upon completion and development
f the aviation complex situated therein which is now being undertaken by
the Bases Conversion and Development Authority (BASECON) and the Clark
Development Corporation (CDC) conformably with the provisions of RA 7227,
otherwise known as the Bases Conversion Act of 1992;
2. The Bases Conversion and Development Authority (BASECON) and the Clark
Development Corporation (CDC) shall implement the phased development
of the Clark Aviation Complex, together with its expressway and rail access
systems in accordance with its Master Plan with the support of the Department
of Public Works and Highways (DPWH), Philippine National Construction
Corporation (PNCC), and Philippine National Railways (PNR).
Moreover, BASECON shall be tasked with the following:
a. Review and recommend to the President a Master Development Plan for the
Clark Aviation Complex providing it with world class facilities and high service
standards.
b. Recommend the organizational structure of a proposed Clark International
Airport Corporation which shall have jurisdiction over the entire Clark aviation
complex.
c. Formulate a comprehensive phased implementation program for Clark Airport
Development Project in accordance with the Master Plan, and with an initial
opening date capacity of 14 Million passengers by 1998.
d. Develop the Terms of Reference under public and private partnership for the
construction and operation of the Clark Aviation Complex.
e. Recommend to the President other essential priority programs and infrastructure
projects that will support the operations of Clark International Airport.
f. Require the assistance of other government agencies and enlist the support of
the private sector for this undertaking.
The funds necessary for the implementation of this Order shall be charged against the
Budget of the Bases Conversion Development Authority and augmented if necessary,
from the Contingent Fund authorized under the general Appropriations Act of 1994.

Laws on Bases Conversion

108

CLARK INTERNATIONAL AIRPORT - Executive Order No. 174

This may also be augmented by foreign assistance grants to be sourced by the National
Economic Development Authority, the Coordinating Council of the Philippine
Assistance Program, the Department of Transportation and Communications and the
Bases Conversion Development Authority.
This Executive Order shall take effect immediately.
DONE in the City of Manila this 28th day of April in the year of our Lord, Nineteen
Hundred and Ninety-four.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:

(Sgd.) TEOFISTO T. GUINGONA, JR.


Executive Secretary

109

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 192

Executive Order No. 192


Authorizing the Establishment of the Clark International Airport Corporation
to Operate and Manage the Clark Aviation Complex
WHEREAS, under Republic Act No. 7227, otherwise known as the Bases Conversion
Development Act of 1992, it is the policy of the Government to accelerate the sound
and balanced conversion into alternative productive uses of the Clark and Subic military
reservations and their extensions to promote the economic and social development of
the country;
WHEREAS, under Republic Act No. 7227 (1992), the Bases Conversion Development
Authority is empowered to form, establish, organize and maintain subsidiary
corporations formed in accordance with the Corporation Code and existing rules and
regulations promulgated by the Securities and Exchange Commission;
WHEREAS, Executive Order No. 80 (1993) authorized the establishment of the Clark
Development Corporation (CDC) as the operating and implementing arm of the Bases
Conversion Development Authority for the Clark Special Economic Zone;
WHEREAS, pursuant to Executive Order No. 62 (1993), the Clark Special Economic
Zone is envisioned as a major civil aviation comp for international passengers and/or
cargo;
WHEREAS, Executive Order No. 174 (1994) mandates the Bases Conversion
Development Authority and the Clark Development Corporation to implement the
phased development of the Clark Aviation Comp and tasks the former to recommend
the organizational structure of a proposed Clark International Airport Corporation
which shall have jurisdiction over the operations of the entire Clark Aviation Comp;
and
WHEREAS, the variety of activities in the aviation comp calls for diverse types of
expertise which should be assigned to specialists and government agencies whose
interventions are required by law.
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines,
by virtue of the powers vested in me by law, do hereby order the following:
Section 1. Creation of the Clark International Airport Corporation.A body corporate
to be known as the Clark International Airport Corporation (CIAC) is hereby authorized
to be formed to operate and manage the Clark Aviation Comp.
Pursuant to Section 16 of Republic Act No. 7227 (1992), the CIAC shall be a whollyowned subsidiary corporation of the Clark Development Corporation (CDC) and shall
be formed in accordance with the Corporation Code and existing rules and regulations
Laws on Bases Conversion

110

CLARK INTERNATIONAL AIRPORT - Executive Order No. 192

promulgated by the Securities and Exchange Commission. The CIAC shall be subject to
the policies, rules and regulations promulgated by the Bases Conversion Development
Authority (BCDA)/CDC.
Section 2. Exemption from Civil Service Laws, Rules and Regulations.Pursuant
to Section 16 of Republic Act No. 7227 (1992), the CIAC shall be exempt from the
coverage of Civil Service laws, rules and regulations.
Section 3. Board of Directors.Subject to Section 16 of Republic Act No. 7227
(1992), the powers of the CIAC shall be vested in and exercised by a Board of Directors
which shall be composed of not more than eleven (11) members.
The members of the Board representing the equity of the CDC and other government
corporations or agencies in the capital stock of the CIAC shall be nominated by the
President of the Philippines. No person shall be nominated as a member of the Board
representing the equity in the capital stock of the national government in CIAC unless
he is a Filipino citizen, of good moral character, and of recognized competence in
relevant fields including but not limited to civil aviation, economics, tourism, law or
engineering.
Section 4. Capitalization.The capitalization of the CIAC shall be determined by the
BCDA/CDC which shall include the following:
a. Cash equity to be provided by CDC;
b. Portions of or all government lands embraced and covered by the Clark
Aviation Comp, as well as permanent improvements and fixtures therein upon
proper inventory; and
c. All other assets which the President may transfer to the CIAC as part of the
equity contribution of the Government.
Section 5. Transfer of Clark Air Base Proper. In view of Section 4 hereof, and pending
the full development of the Clark Reverted Baselands, the BCDA shall transfer to the
CDC the land comprising, and the permanent improvements and fixtures within, the
4,440 hectares, more or less, covering the Clark Air Base Proper under Proclamation
No. 163 (1993).
Section 6. Role of Departments, Bureaus, Offices, Agencies, Instrumentalities
of the Government.All heads of departments, bureaus, offices, agencies and
instrumentalities of the government are hereby directed to give full support to the
Clark International Airport development program and to coordinate with the CDC and
the BCDA to facilitate the necessary approvals to expedite the implementation of the
various aspects of the conversion program.

111

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 192

Section 7. Repealing Clause. All executive issuances, rules and regulations or parts
thereof which are inconsistent with the provisions of this Executive Order are hereby
repealed, amended, or modified accordingly.
Section 8. Effectivity. This Executive Order shall take effect immediately.
DONE in the City of Manila, this 27th day of July in the year of Our Lord, Nineteen
Hundred and Ninety-Four.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:

(Sgd.) TEOFISTO T. GUINGONA, JR.


Executive Secretary

Laws on Bases Conversion

112

CLARK INTERNATIONAL AIRPORT - Executive Order No. 360

Executive Order No. 360


Amending Executive Order No. 192, Series of 1994, Authorizing the Establishment
of the Clark International Airport Corporation to Operate and Manage the Clark
Aviation Complex
WHEREAS, Executive Order 192, series of 1994, ordered the creation of the Clark
International Airport Corporation (CIAC);
WHEREAS, there is a need for the Bases Conversion Development Authority (BCDA)
to be the direct stockholder of the CIAC in compliance with R.A. 7227, particularly
Section 4 (d) thereof, which provides that the BCDA will serve as the holding company
of the subsidiary companies created pursuant to Section 16 of this Act;
WHEREAS, there is a need for the BCDA to support and guarantee the financial
transactions of the CIAC as its direct stockholder;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines,
by virtue of the powers vested in me by law, do hereby order the following:
Section 1. Sections 1, 3, 4, 5 and 6 of Executive Order No. 192, s. of 1994, are hereby
respectively amended to read as follows:
Section 1. Creation of the Clark International Airport Corporation.A body
corporate to be known as the Clark International Airport Corporation (CIAC) is
hereby authorized to be formed to operate and manage the Clark Aviation Comp.
Consistent with Sections 4 and 16 of Republic Act No. 7227 (1992), the CIAC shall
be a wholly-owned subsidiary corporation of the Bases Conversion Development
Authority (BCDA) and shall be formed in accordance with the Corporation Code
and existing rules and regulations promulgated by the Securities and Exchange
Commission. The CIAC shall be subject to the policies, rules and regulations
promulgated by the BCDA.
Section 3. Board of Directors.Subject to Section 16 of Republic Act 7227
(1992), the powers of the CIAC shall be vested in and exercised by a Board of
Directors which shall be composed of not more than eleven (11) members.
The members of the Board representing the equity of the BCDA and the other
government corporations or agencies in the capital stock of the CIAC shall be
nominated by the President of the Philippines. No person shall be nominated as a
member of the Board representing the equity in the capital stock of the National
Government in the CIAC unless he is a Filipino citizen, of good moral character,
and of recognized competence in relevant fields including but not limited to civil
aviation, economics, tourism, law or engineering.

113

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 360

Section 4. Capitalization.The capitalization of the CIAC shall be determined by


the BCDA which shall include the following:
a. Cash Equity to be provided by the BCDA;
b. Portions of government lands embraced and covered by the Clark Aviation
Comp, as well as permanent improvements and fixtures therein upon
proper inventory; and
c. All other assets which the President may transfer to the CIAC as part of the
equity contribution of the government.
Section 5. Transfer of Clark Air Base Proper.In view of Section 4 hereof, and
pending the full development of the Clark Reverted Baselands, the BCDA shall
transfer to the CIAC the permanent improvement and fixtures within 2,200 hectare
area, more or less, covering the Clark Aviation Comp which is a part of the Clark
Air Base Proper under Proclamation No. 163, s. of 1993.
Section 6. Role of Departments, Bureaus, Offices, Agencies, Instrumentalities
of the Government.All heads of departments, bureaus, offices, agencies and
instrumentalities of the government are hereby directed to give full support to
the Clark International Airport development program and to coordinate with the
BCDA to facilitate the necessary approvals to expedite the implementation of the
various aspect of the conversion programs.
Section 2. All orders, rules and regulations, or parts thereof, which are inconsistent
with this Executive Order are hereby repealed, amended or modified accordingly.
Section 3. This Executive Order shall take effect immediately.
DONE in the City of Manila, this 16th day of August, in the year of Our lord, Nineteen
Hundred and Ninety-Six.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:
(Sgd.) RUBEN D. TORRES
Executive Secretary
Laws on Bases Conversion

114

CLARK INTERNATIONAL AIRPORT - Executive Order No. 186

Executive Order No. 186


Re-Establishing the Clark International Airport Corporation
as a Subsidiary of the Bases Conversion Development Authority
WHEREAS, under Republic Act No. 7227, otherwise known as the "Bases Conversion
Development Act of 1992", it is the policy of the government to accelerate the sound
and balanced conversion into alternative productive uses of the Clark and Subic military
reservations and their extensions to promote the economic and social development of
the country;
WHEREAS, pursuant to Executive Order No. 80, series of 1993, the Clark Development
Corporation (CDC) was created as the implementing arm of the Bases Conversion
Development Authority (BCDA) for the Clark Special Economic Zone which
envisioned Clark to be converted into an international civil aviation complex, a
modern international estate and tourism, trade and business center for Luzon and Asia;
WHEREAS, Executive Order No. 192, series of 1994, established the Clark International
Airport Corporation (CIAC) to operate and manage the Clark Civil Aviation Complex;
WHEREAS, Executive Order No. 7, series of 2001 authorized the merger of the CIAC
and CDC in order that there will be effective and efficient coordination in pursuing
their policies and operations;
WHEREAS, the merger of CIAC and CDC, with the latter as the surviving corporation,
has diminished the focus and priority of the development of the Clark International
Airport; and
WHEREAS, coordination in policies and operations can still be achieved even if CIAC
and CDC are separate and distinct agencies.
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic
of the Philippines, by virtue of the powers vested in me by law, do hereby order the
following:
SECTION 1. The Clark International Airport Corporation (CIAC) is hereby re-established
as a subsidiary of the BCDA to operate and manage the Clark Civil Aviation Complex.
SECTION 2. The Chairman of the BCDA is hereby directed to prepare a plan and take
all the necessary steps towards effecting the re-establishment of CIAC as a separate
entity from CDC as envisioned under Executive Order No. 192, series of 1994.
The Chairman of the BCDA shall submit, for approval by the Office of the President,
among others, the proposed articles of incorporation, the by-laws of CIAC, the
composition of its Board of Directors and its capitalization.

115

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 186

SECTION 3. The BCDA Chairman shall submit a report to the President on the action
taken as soon as the re-establishment of CIAC shall have been completed.
SECTION 4. All orders, rules and regulations, or parts thereof which are inconsistent
with this Executive Order are hereby repealed, amended or modified accordingly.
SECTION 5. This Executive Order shall take effect immediately.
DONE in the City of Manila, this 10th day of March, in the year of our Lord, two
thousand and three.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) ALBERTO G. ROMULO


Executive Secretary

Laws on Bases Conversion

116

CLARK INTERNATIONAL AIRPORT - Executive Order No. 193

Executive Order No. 193


Establishing the Clark International Airport Corporation
as a Subsidiary of the Clark Development Corporation
and Repealing Executive Order No. 186 for this Purpose
WHEREAS, Executive Order No. 186 re-established the Clark International Airport
Corporation (CIAC) as a subsidiary of the Bases Conversion Development Authority
(BCDA) to manage and operate the Diosdado Macapagal International Airport (DMIA);
WHEREAS, Clark Development Corporation (CDC) has a vision to develop the Clark
Special Economic Zone (CSEZ) as an "aerotropolis" or a globally competitive urban
center with the DMIA as centerpiece;
WHEREAS, in order to foster synergy in the development of the DMIA as well as the
CSEZ, there is a need for closer coordination between the CDC as implementing arm
of the CSEZ and the CIAC as the operator of the DMIA.
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic
of the Philippines, by virtue of the powers vested in me by law, do hereby order the
following:
SECTION 1. The Clark International Airport Corporation (CIAC) is hereby established
as a subsidiary of the Clark Development Corporation (CDC) to operate and manage
the Clark Civil Aviation Complex.
SECTION 2. The Chairman of the CDC is hereby directed to prepare a plan to take
all necessary steps towards effecting the establishment of CIAC as a subsidiary of the
CDC.
The Chairman of the CDC shall submit, for approval of the Office of the President,
among others, the proposed articles of incorporation, the by-laws of CIAC, and its
capitalization.
SECTION 3. The BCDA Chairman shall submit a report to the President on the action
taken as soon as the establishment of CIAC as a subsidiary of the CDC shall have been
completed.
SECTION 4. Executive Order No. 186 dated March 10, 2003 is hereby repealed.
All orders, rules and regulations, or parts thereof which are inconsistent with this
Executive Order are hereby repealed, amended or modified accordingly.

117

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 193

SECTION 5. This Executive Order shall take effect immediately.


DONE in the City of Manila, this 4th day of April, in the year of our Lord, two thousand
and three.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President

(Sgd.) ALBERTO G. ROMULO


Executive Secretary

Laws on Bases Conversion

118

CLARK INTERNATIONAL AIRPORT - Executive Order No. 341

Executive Order No. 341


Reorganizining the Manila International Airport Authority (MIAA)
Modifying Its Powers and Functions, and Authorizing and Directing
the MIAA to Excercise Administrative Supervision and Control
Over All International Airports in the Philippines
WHEREAS, the Manila International Airport Authority (MIAA) which was created by
virtue of Executive Order No. 778 (s. 1982), otherwise known as the "Charter of the
Manila International Airport Authority," is an agency under the Executive Department
attached to the Department of Transportation and Communications (DOTC), originally
tasked to, among others, formulate a comprehensive and integrated policy and program
for the Manila International Airport (now the Ninoy Aquino International Airport) and
other airports in the Philippines, and to implement, review and upgrade such policy
and program periodically;
WHEREAS, pursuant to Executive Order No. 903 (s. 1983), as amended by Executive
Order Nos. 908 (s. 1983) and 298 (s. 1987), otherwise known as the "Revised Charter of
the MIAA," all references to the MIAAs authority over other airports in the Philippines
was deleted;
WHEREAS, pursuant to its mandate, the MIAA has acquired and developed the
expertise necessary for the proper functioning of an international airport terminal,
particularly with respect to its management, operation, maintenance and development
to internationally-accepted standards;
WHEREAS, in order to achieve unity in policies and programs relating to the
management, operation, maintenance and development of all the international airports
in the country to expand the powers and functions of the MIAA by authorizing and
directing it to exercise administrative supervision and control over all international
airports in the Philippines;
NOW, THEREFORE, I GLORIA MACAPAGAL-ARROYO, President of the Republic of
the Philippines, by virtue of the powers vested in me by the Constitution and existing
law, do hereby order:
SECTION 1. Administrative Supervision and Control. - The Manila International
Airport Authority (MIAA) is hereby authorized and directed to exercise administrative
supervision and control over all international airports in the Philippines and shall
formulate, promote and implement a comprehensive and integrated program for the
management, operation, maintenance and development of all international airports in
the Philippines to internationally-accepted standards.

119

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 341

For this purpose, the MIAA, through its General Manager, shall perform any of the
following actions, with respect to the Loag International Airport, the Diosdado
Macapagal International Airport (formerly the Clark International Airport), the Subic
International Airport, the Mactan-Cebu International Airport, the Francisco Bangoy
International Airport in Davao, the General Santos International Airport, the Zamboanga
International Airport, and such other international airports as may be established in the
Philippines:
a. a. Act directly on any matter involving the management, operation, maintenance
or development of any of the international airports in the Philippines;
b. Direct any of the officials of the international airports to perform their duties or
retrain the commission of acts;
c. Review, approve, reverse or modify acts and decisions of the governing board,
officials or units of all the international airports;
d. Determine priorities in the execution of plans and programs; and
e. Prescribe standards, guidelines, plans and programs.
SECTION 2. Report to the President. The MIAA, through its General Manager, shall
submit to the President, through the Secretary of the Department of Transportation and
Communications, an integrated and comprehensive annual report generally dealing
with the expanded functions, activities and operations of the MIAA as provided herein.
SECTION 3. Rules and Regulations. The MIAA, in consultation with the DOTC
Secretary, is hereby authorized to issue rules and regulations for the effective
implementation of the provisions of this Executive Order.
SECTION 4. Assistance. The MIAA and the MIAA General Manager may call upon
any agency or office
of the Government for such assistance as may be necessary or appropriate in the
performance of its/his functions as directed herein.
All heads of departments, agency bureaus and offices, including government-owned or
controlled corporations, are hereby enjoined to render full assistance and cooperation
to the MIAA and the MIAA General Manager, and to provide such information and data
as may be required to carry out its/his functions pursuant t this Order.
SECTION 5. Repealing Clause. All executive issuances, rules and regulations or parts
thereof which are inconsistent with the provisions of this Executive
Order are hereby repealed, amended, or modified accordingly.

Laws on Bases Conversion

120

CLARK INTERNATIONAL AIRPORT - Executive Order No. 341

SECTION 6. Effectivity. This Executive Order shall take effect immediately.


City of Manila, Aug. 04 2004

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) ALBERTO G. ROMULO


Executive Secretary

121

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 716

Executive Order No. 716


Transforming the Clark International Airport Corporation (CIAC) into a Subsidiary
of the Bases Conversion and Development Authority (BCDA), and Amending
Executive Order No. 193 for this Purpose
WHEREAS, Executive Order No. 174, Series of 1994, designated the Clark Special
Economic Zone as the future site of a premier international airport;
WHEREAS, Executive Order No. 193, Series of 2003, established Clark International
Airport Corporation (CIAC), as a subsidiary of Clark Development Corporation (CDC),
to operate and manage the Clark Civil Aviation Complex, including the Diosdado
Macapagal International Airport (DMIA);
WHEREAS, Section 5 (f) of Republic Act 722/ grants BCDA the authority to construct,
own, lease, operate and maintain public utilities as well as infrastructure;
WHEREAS, CIAC was granted by the Clark Development Corporation a fifty (50)
year franchise to operate the Clark Civil Aviation Complex-Diosdado Macapagal
International Airport (DMIA);
WHEREAS, the development of Clark to be a globally competitive international service
and logistics center in the Asia-Pacific Region has been declared as one of the 10-point
legacy agenda of this Administration;
WHEREAS, the Department of Transportation and Communications (DOTC) pursuant
to Executive Order No. 125, as amended by Executive Order No. 125-A Series of
1987, is the primary policy, planning, programming, coordinating, implementing,
regulating and administrative entity of the Executive Branch of the government in the
promotion, development and regulation of dependable and coordinated networks of
transportation and communication systems as well as in the fast, safe, efficient and
reliable postal transportation and communications services;
WHEREAS, there is a need to transform CIAC into a subsidiary of BCDA to ensure
that the development of the Clark Civil Aviation Complex-DMIA is aligned to the
conversion program of BCDA;
WHEREAS, there is a need to clarify the functions and jurisdiction of CDC and CIAC in
order to create synergy between the two corporations;
NOW, THEREFORE, I, GLORIA-MACAPAGAl-ARROYO, President of the Republic of
the Philippines, by virtue of the powers vested in me by law, do hereby order:
SECTION 1. The Clark International Airport Corporation (CIAC) is hereby transformed
from a subsidiary of Clark Development Corporation (CDC) to a subsidiary of the Bases
Laws on Bases Conversion

122

CLARK INTERNATIONAL AIRPORT - Executive Order No. 716

Conversion and Development Authority (BCDA) to operate and manage the Clark Civil
Aviation Complex (CCAC) defined herein. The ownership of CIAC shall revert to the
BCDA which shall be the recipient of the dividends from CIAC.
SECTION 2. CIAC shall be subject to the policy supervision of the Department of
Transportation and Communications (DOTC).
SECTION 3. CDC shall remain the implementing arm of BCDA within the Clark
Freeport Zone and Clark Special Economic Zone, pursuant to Section 15 of RA 7227
and RA 9400.
SECTION 4. Board of Directors. The powers of the CIAC shall be vested in and
exercised by the Board of Directors which shall be composed of not more than nine
(9) members,
The Chairman and Members of the Board shall be nominated by the President of the
Philippines,
No person shall be nominated as a member of the Board of CIAC unless he is a Filipino
citizen, of good moral character, and of recognized competence in relevant fields
including but not limited to civil aviation, economics, finance, law, engineering or
management
SECTION 5. CIAC shall only engage in aviation, aviation-related services, and aviationrelated logistics activities. All lease and business arrangements pertaining to the said
services /activities shall now be solely undertaken by CIAC.
SECTION 6. The Clark Civil Aviation Complex (CCAC) shall comprise the area of two
thousand two hundred (2,200) hectares, and shall be under the jurisdiction of the
CIAC.
SECTION 7. The Clark Industrial Estate 5 (IE5) area measuring approximately 290
hectares is hereby declared a logistics center.
The area of approximately 166.9 hectares within the IE5 area, which is bounded on
the East by the East Perimeter Wall; on the West by the Subic-Ciark-Tarlac Expressway
(SCTEX) Interchange; and on the North by the SCTEX Logistics Interchange, shall be
under the jurisdiction of CIAC. The remaining areas shall be under the jurisdiction of
CDC
SECTION 8. The BCDA is hereby directed to prepare an implementing plan and take
the necessary steps towards effecting the transformation of CIAC, as BCDA's subsidiary,
pursuant to Section 16 of RA No. 7227, to include all aspects that will govern the
relationships among BCDA, CDC and CIAC.

123

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 716

SECTION 9. All heads of government departments, bureaus, offices, agencies,


government owned and controlled corporations and instrumentalities are directed to
fast-track the necessary approvals and assists the CIAC to expedite the implementation
of the various projects and activities for the development of the Clark Civil Aviation
Complex.
SECTION 10. All other orders, issuances or portions thereof, which are inconsistent
with this Executive Order are hereby revoked, amended or modified accordingly.
SECTION 11. This Executive Order shall take effect immediately.
DONE in the City of Manila, this 3rd day of April in the year of Our Lord, Two Thousand
and Eight.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

Laws on Bases Conversion

124

CLARK INTERNATIONAL AIRPORT - Executive Order No. 64

Executive Order No. 64


Transferring the Clark International Airport Corporation (CIAC) from
the Office of the President to the Department of Transportation
and Communications (DOTC), Making CIAC an Agency Attached to
the DOTC, and further Transferring the Shares of Stock of CIAC
WHEREAS, CIAC was incorporated and registered with the Securities and Exchange
Commission (SEC) as a wholly-owned subsidiary of the Clark Development Corporation
(CDC) pursuant to Executive Order No. (EO) 192 (s. 1994), with the primary purpose of
operating and managing the Clark Civil Aviation Complex (CCAC);
WHEREAS, EO 360 (s. 1996) was issued making CIAC a subsidiary of the Bases
Conversion and Development Authority (BCDA), consistent with the provisions of
Republic Act No. (RA) 7227, as amended, otherwise known as the Bases Conversion
and Development Act of 1992;
WHEREAS, EO 7 (s. 2001), authorized the merger of CIAC and CDC, with CDC as the
surviving corporation, in order that there will be effective and efficient coordination in
pursuing their policies and operations;
WHEREAS, EO 186 (s. 2003) re-established CIAC as a subsidiary of the BCDA;
WHEREAS, EO 193 (s. 2003) repealed EO 186 (s. 2003), and established CIAC as a
subsidiary of CDC;
WHEREAS, EO 341 (s. 2004) directed the Manila International Airport Authority (MIAA)
to exercise administrative supervision and control over all international airports in the
Philippines, including the Diosdado Macapagal International Airport (DMIA), which
is within the CCAC;
WHEREAS, CIAC was transformed from a subsidiary of CDC to a subsidiary of BCDA
and made subject to the policy supervision of DOTC under EO 716 (s. 2008);
WHEREAS, EO 716 further provides that CIAC shall exercise jurisdiction over CCAC,
which is comprised of 2,200 hectares, as well as over the area of approximately 166.9
hectares within the Clark Industria! Estate 5 (IE5), which is bounded on the East by
the East Perimeter Wall; on the West by the Subic-Clark-Tarlac Expressway (SCTEX)
Interchange; and on the North by the SCTEX Logistics Interchange.
WHEREAS, the CCAC is envisioned to be thePhilippines premier international airport;
WHEREAS, the DOTC is the primary policy, planning, programming, coordinating,
implementing and administrative entity in the Executive Branch in charge of the
promotion, development, and regulation of dependable and coordinated networks of

125

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 64

transportation and communications system, as well as of the fast, safe, efficient and
reliable postal, transportation and communications services;
WHEREAS, to ensure the continued development of the CCAC, there is a need to
establish clear lines of authority and accountability by directing a specific cabinet
office to exercise primary oversight functions over the same;
WHEREAS, in order for the DOTC to effectively oversee and monitor the development
of the CCAC, there is a need to transfer administrative control and supervision over
CIAC to the DOTC; and
WHEREAS, the Administrative Code of 1987 grants the President the continuing
authority to reorganize the administrative structure of the Executive Branch.
NOW, THEREFORE, I, BENIGNO S. AQUINO III, President of the Philippines,
by virtue of the powers vested in me by the Constitution and existing laws, do hereby
order:
SECTION 1. CIAC as an attached agency of the DOTC. CIAC is hereby attached to the
DOTC which shall exercise administrative control and supervision over CIAC.
SECTION 2. Board of Directors. The powers and functions of the CIAC shall be vested
in and exercised by a Board of Directors to be composed of eleven (11) members, as
follows:
Chairperson:

Secretary of Transportation and Communications;

Vice Chairperson:

Secretary of Tourism;

Members:

General Manager, MIAA;


Director General, Civil Aviation Authority of the Philippines
(CAAP); and Seven (7) other members to be appointed by the
President of the Philippines, upon consultation with the Secretary
of Transportation and Communications, representing the equity
in the capital stock of the National Government in CIAC,
provided each one of them is a Filipino citizen, of good moral
character, and of recognized competence in a relevant field,
including, but not limited to civil aviation, economics, tourism,
law or engineering; Provided, however, that the nomination
and appointment of the seven (7) appointive directors shall
comply with the provisions of RA 10149, otherwise known as
the GOCC Governance Act of 2011.

SECTION 3. Transfer of Shares of Stock and Control Over Assets and Facilities. The
BCDA, or the entity or persons in whose names the shares of stock of CIAC are registered
at present, are hereby ordered to transfer and convey immediately to the National
Government all the shares of stock of CIAC in order for the National Government
Laws on Bases Conversion

126

CLARK INTERNATIONAL AIRPORT - Executive Order No. 64

to own and hold all such shares of stock as the registered stockholder of record and
deliver all the shares in the name of the National Government to the Secretary of
Transportation and Communications on behalf of the Republic of the Philippines;
Provided, however, that any delay in the execution of such documents of transfer and
conveyance of the shares of stock of the National Government shall not, in any event,
delay, hinder or deter the immediate exercise of all powers of control and supervision
over CIAC by the Secretary of Transportation and Communications, including without
limitation, the power to recommend the appointment or removal and replacement of
the members of the Board of Directors and officers of CIAC, subject to the provisions
of RA 10149.
SECTION 4. Role of Departments, Bureaus, Offices, Agencies, Instrumentalities of
the Government. The Secretary of Transportation and Communications may call upon
the Department of Finance (DOF), Department of Budget and Management (DBM),
National Economic and Development Authority (NEDA), BCDA, CDC, and any other
agency of the Government for such assistance as may be necessary or appropriate in
the performance of his functions.
All heads of departments, agencies, bureaus, offices, including government-owned or
controlled corporations, are hereby enjoined to render full assistance and cooperation
to the Secretary of Transportation and Communications and provide such information
and data as may be required to carry out his functions pursuant to this Order.
SECTION 5. Repeal. All issuances, orders, rules and regulations, or parts thereof,
which are inconsistent with this Executive Order are hereby repealed amended or
modified accordingly.
SECTION 6. Separability. If any provision of this Executive Order is declared invalid
or unconstitutional, the other provisions unaffected shall remain valid and subsisting.
SECTION 7. Effectivity. This Executive Order shall take effect immediately upon
publication in a newspaper of general circulation.
DONE, in the City of Manila, this 21st day of December, in the Year of our Lord, Two
Thousand and Eleven.

(Sgd.) BENIGNO S. AQUINO III


President of the Philippines

127

Laws on Bases Conversion

CLARK INTERNATIONAL AIRPORT - Executive Order No. 64

By the President:

(Sgd.) PAQUITO N. OCHOA, JR.


Executive Secretary

Laws on Bases Conversion

128

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 198

Proclamation No. 198


Transferring the John Hay Air Station to the Bases Conversion
Development Authority, Renaming it as Club John Hay,
an Declaring it for Tourism, Human Resource Development Center
and Multiple-Use Forest Watershed Reservation Purposes
Pursuant to the powers vested in me by law, I, FIDEL V. RAMOS, President of the
Philippines, do hereby transfer the ownership, administration, and control over the
John Hay Air Station covering an area of Five Hundred Seventy (570) Hectares, more
or less, to the Bases Conversion and Development Authority (BCDA). Subject to the
provisions of law, the adjacent areas now occupied in the Voice of America and the
United States Ambassadors residence shall be transferred to the BCDA upon the
turnover of those properties to the Republic of the Philippines.
The foregoing area, hereafter called Club John Hay, is hereby declared for tourism,
human resource development center, and multiple use forest watershed reservation
purposes.
The BCDA shall be the governing body for Club John Hay. The BCDA through the
operating and implementing arm it shall establish for Club John Hay shall promulgate
and implement rules and regulations governing the conversion, development and
conservation of natural resources within the area in consultation with pertinent
national and local government offices, such as, the Department of Environment and
Natural Resources (DENR), to effectively carry out the sustainable development plans
for Club John Hay. Such rules and regulations shall include the procedures for setting
existing claims within the area in accordance with pertinent laws.
The boundaries of Club John Hay shall be subject to actual survey contracted by BCDA
and verified and approved by DENR.
DONE in the City of Manila, this 29th day of June in the year of Our Lord, Nineteen
Hundred and Ninety-Three.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:
(Sgd.) ANTONIO T. CARPIO
Chief Presidential Legal Counsel

129

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Executive Order No. 103

Executive Order No. 103


Authorizing the Establishment of the John Hay Development Corporation as the
Implementing Arm of the Bases Conversion Development Authority for Club John
Hay, and Directing All Heads of Departments, Bureaus, Offices, Agencies and
Instrumentalities of Government to Support the Program
WHEREAS, it is the policy of the Government to accelerate the sound and balanced
conversion of the former military reservations and their contiguous extensions into
alternative productive civilian uses to promote the economic and social development
of the country;
WHEREAS, the Bases Conversion Development Authority (BCDA) is mandated
by Republic Act No. 7227 (RA 7227), otherwise known as the Bases Conversion
Development Act of 1992, to prepare, adopt and implement a comprehensive and
detailed plan for the conversion of these military reservations and their contiguous
extensions consistent with the plans and programs of the national government and
local government units;
WHEREAS, Section 16 of RA 7227, authorizes the BCDA to form, establish, organize
and maintain subsidiaries in accordance with Philippine Corporation Law;
WHEREAS, it is envisioned that Club John Hay will be converted into a tourism, human
resource development center and multiple use forest watershed reservation; and
WHEREAS, the national leadership is cognizant of the vital role of the private sector
and local government units in the John Hay conversion program.
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines,
by virtue of the powers vested in me by law, do hereby order:
SECTION 1. Creation of John Hay Development Corporation. A body corporate to
be known as the John Hay Development Corporation (JHDC) is hereby authorized to
be formed as the operating and implementing arm of the BCDA to manage the Club
John Hay, formerly known as the John Hay Air Station or Camp John Hay.
The JHDC shall be a subsidiary corporation of the BCDA and shall be formed in
accordance with Philippine Corporation Law and existing rules and regulations
promulgated by the Securities and Exchange Commission pursuant to Section 16 of
RA 7227.
The JHDC shall be subject to the policies, rules and regulations of the BCDA.
SECTION 2. Powers and Functions of the John Hay Development Corporation. The
BCDA, as the incorporator and holding company of its John Hay subsidiary, shall
Laws on Bases Conversion

130

JOHN HAY SPECIAL ECONOMIC ZONE - Executive Order No. 103

determine the powers and functions of JHDC. The JHDC shall be exempt from the
coverage of the Civil Service laws, rules and regulations.
SECTION 3. Board of Directors. The powers of the JHDC shall be vested in and
exercised by a Board of Directors (Board) which shall be composed of not more than
eleven (11) members; provided that the composition of the JHDC Board shall be subject
to the provisions of Section 16 of RA 7227.
The members of the Board representing the equity or capital stock in JHDC of BCDA
and other national government agencies shall be nominated by the President.
No person shall be nominated as a member of the Board representing the capital stock
of the national government in JHDC unless he is a Filipino citizen, of good moral
character, and of recognized competence in relevant fields including but not limited to
economics, tourism, management, international relations, law or engineering.
SECTION 4. Capitalization. The capitalization of the JHDC shall be determined by
the BCDA, which shall include the following:
4.1 Cash equity provided by the BCDA and other agencies and instrumentalities
of government;
4.2 Portions of or all of the lands, embrace and covered by Club John Hay, as well
as permanent improvements and fixtures therein upon proper inventory; and
4.3 All other assets which the President may transfer to the JHDC as part of the
equity contributions of the Government.
SECTION 5. Role of Departments, Bureaus, Offices, Agencies and Instrumentalities.
All heads of departments, bureaus, offices, agencies and instrumentalities of the
government are hereby directed to give full support to the John Hay conversion
program and to coordinate with the BCDA to facilitate the necessary approvals to
expedite the implementation of the various projects of the conversion program.
SECTION 6. Repealing Clause. All executive issuances, rules and regulations or
parts thereof which are inconsistent with the provisions of this Executive Order are
hereby repealed, amended or modified accordingly.

131

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Executive Order No. 103

SECTION 7. Effectivity. This Executive Order shall take effect immediately.


DONE in the City of Manila, this 29th day of June in the year of Our Lord, Nineteen
Hundred and Ninety-Three.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:

(Sgd.) ANTONIO T. CARPIO


Chief Presidential Legal Counsel

Laws on Bases Conversion

132

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 420

Proclamation No. 420


Creating and Designating a Portion of the Area Covered by
the Former Camp John Hay as the John Hay Special Economic Zone
Pursuant to Republic Act No. 7227
Pursuant to the powers vested in me by the law and the resolution of concurrence by
the City Council of Baguio, I, FIDEL V. RAMOS, President of the Philippines, do hereby
create and designate a portion of the area covered by the former John Hay reservation
as embraced, covered, and defined by the 1947 Military Bases Agreement between
the Philippines and the United States of America, as amended, as the John Hay Special
Economic Zone, and accordingly order:
Section 1. Coverage of John Hay Special Economic Zone.The John Hay Special
Economic Zone shall cover the area consisting of Two Hundred Eighty Eight and one/
tenth (288.1) hectares, more or less, of the total of Six Hundred Seventy-Seven (677)
hectares of the John Hay Reservation, more or less, which have been surveyed and
verified by the Department of Environment and Natural Resources (DENR) as defined
by the following technical description:
A parcel of land, situated in the City of Baguio, Province of Benguet, Island of Luzon,
and particularly described in, survey plans Psd-131102-002639 and Ccs-131102000030 as approved on 16 August 1993 and 26 August 1993, and 131102-000030 as
approved on 16 August 1993 and 26 August 1993, respectively, by the Department of
Environment and Natural Resources, in detail containing:
Lot 1, Lot 2, Lot 3, Lot 4, Lot 5, Lot 6, Lot 7, Lot 13, Lot 14, Lot 15, and Lot 20 of
Ccs-131102-000030
-andLot 3, Lot 4, Lot 5, Lot 6, Lot 7, Lot 8, Lot 9, Lot 10, Lot 11, Lot 14, Lot 15, Lot 16, Lot
17 and Lot 18 of Psd-131102-002639 being portions of TCT No. T-3812, LRC Rec.
No. 87.
With combined areas of TWO HUNDRED EIGHTY EIGHT-AND ONE/TENTH
HECTARES (288.1 hectares); Provided that the area consisting of approximately Six
and two/tenth (6.2) hectares; more or less, presently occupied by the VOA and the
residence of the Ambassador of the United States, shall be considered as part of the
SEZ only upon turnover of the properties to the government of the Republic of the
Philippines.
Section 2. Governing Body of the John Hay Special Economic Zone.Pursuant to Section
15 of Republic Act No. 7227, the Bases Conversion and Development Authority is
hereby established as the governing body of the John Hay Special Economic Zone and,

133

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 420

as such, authorized to determine the utilization and disposition of the lands comprising
it, subject to private rights, if any, and in consultation and coordination with the City
Government of Baguio after consultation with its inhabitants, and to promulgate the
necessary policies, rules, and regulations to govern and regulate the zone thru the
John Hay Poro Point Development Corporation, which is its implementing arm for its
economic development and optimum utilization.
Section 3. Investment Climate in John Hay Special Economic Zone.Pursuant to Sections
5(m) Section 15 of Republic Act No. 7227, the John Hay Poro Point Development
Corporation shall implement all necessary policies, rules, and regulations governing
the zone, including investment incentives, in consultation with pertinent government
departments. Among others, the zone shall have all the applicable incentives of
the Special Economic Zone under Section 12 of Republic Act No. 7227 and those
applicable incentives granted in the Export Processing Zones, the Omnibus Investment
Code of 1987, the Foreign Investment Act of 1991, and new investment laws that may
hereinafter be enacted.
Section 4. Role of Departments, Bureaus, Offices, Agencies and Instrumentalities.
All heads of departments, bureaus, offices, agencies, and instrumentalities of the
government are hereby directed to give full support to Bases Conversion and
Development Authority and/or its implementing subsidiary or joint venture to facilitate
the necessary approvals to expedite the implementation of various projects of the
conversion program.
Sec. 5. Local Authority.Except as herein provided, the affected local government units
shall retain their basic autonomy and identity.
Sec. 6. Repealing Clause.All orders, rules, and regulations, or parts thereof, which are
inconsistent with the provisions of this Proclamation, are hereby repealed, amended,
or modified accordingly.
Sec. 7. Effectivity.This Proclamation shall take effect immediately.
Done in the City of Manila, this 5th day of July, in the year of Our Lord, nineteen
hundred and ninety four.
(Sgd.) FIDEL V. RAMOS
President of the Philippines
By the President:
(Sgd.) TEOFISTO T. GUINGONA, JR.
President of the Philippines
Laws on Bases Conversion

134

JOHN HAY SPECIAL ECONOMIC ZONE - Executive Order No. 31

Executive Order No. 31


Amending Sections 1

and

of

Executive Order No. 103, Series

of

1993

WHEREAS, Section 4(a) of RA 7227, authorizes the Bases Conversion Development


Authority (BCDA) to own, hold and/or administer the military reservation of John Hay
Air Station in Baguio City and Wallace Air Station in Poro Point, San Fernando, La
Union;
WHEREAS, Executive Order No. 103 dated 29 June 1993 ordered the creation of the
John Hay Development Corporation (JHDC) as the implementing arm of BCDA for the
development of John Hay;
WHEREAS, there is a need to provide adequate private sector representation in the
Board of Directors of JPDC to provide participation of the communities affected by the
programs of JPDC;
NOW, THEREFORE, I, JOSEPH EJERCITO ESTRADA, President of the Republic of
the Philippines, by virtue of the powers vested in me by law, do hereby order:
SECTION 1. Section 1, Paragraph 1 and Section 3, Paragraph 1 of E.O. No. 103, s. of
1993, are hereby respectively amended as follows:
Section 1. Creation of John Hay Poro Point Development Corporation A body
corporate to be known as the John Hay Poro Point Development Corporation
(JPDC) is hereby authorized to be formed as the operating and implementing arm
of the BCDA to manage the John Hay Special Economic Zone, formerly known as
the Camp John Hay and Poro Point Special Economic and Freeport Zone, formerly
known as Wallace Air Station and its contiguous areas.
JHDC shall hereinafter be referred to as JPDC.
Section 3. Board of Directors The powers of the JPDC shall be vested in and
exercised by a Board of Directors (Board) which shall be composed of fifteen (15)
members; provided that the composition of the JPDC Board shall be subject to the
provisions of Section 16 of RA 7227.
SECTION 2. All orders, rules and regulations, or parts thereof, which are inconsistent
with this Executive Order are hereby repealed, amended or modified accordingly.

135

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Executive Order No. 31

SECTION 3. This Executive Order shall take effect immediately.


DONE in the City of Manila, this 7th day of October in the year of Our Lord, Nineteen
Hundred and Ninety-Eight.

(Sgd.) JOSEPH EJERCITO ESTRADA


President of the Philippines
By the President:

(Sgd.) RONALDO B. ZAMORA


Executive Secretary

Laws on Bases Conversion

136

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

Proclamation No. 1191


Creating and Designating the Area Covered by the John Hay
Special Economic Zone in the City of Baguio, Province of Benguet,
Created and Designated under Presidential Proclamation No. 420,
Series of 1994, as a Special Tourism Economic Zone Pursuant to
Republic Act No. 7916, as Amended by Republic Act No. 8748
Pursuant to tile powers vested in me under Republic Act No. 7916, otherwise known
as the Special Economic Zone Act of 1995, as amended by Republic Act No. 8748,
and upon the recommendation of the Board of Directors of the Philippine Economic
Zone Authority, I, GLORIA MACAPAGAL ARROYO, President of the Republic of the
Philippines, do hereby create and designate as Special Tourism Economic Zone, subject
to the provisions of Republic Act No. 7916, as amended, its Implementing Rules and
Regulations, and Resolution No. 06-186 dated 25 April 2006 of the PEZA Board of
Directors, the area covered by the John Hay Special Economic Zone situated at the
City of Baguio, Province of Benguet, which was created and designated as such under
Presidential Proclamation No. 420, series of 1994, consisting of THREE MILLION
EIGHTEEN THOUSAND SIX HUNDRED TWO (3,018,602) SQUARE METERS, more
or less, as defined by the following technical description:
Lot 1, Ccs-131102-000030
Bases Conversion & Devt. Authority
GOLF COURSE CLUSTER
A parcel of land (Lot 1, Ccs-131102-000030 being a portion of consolidated lots of
II-5958 (portion) and Lot 1, II-5958 Amd.) situated at Res. Sec. J; City of Baguio,
Island of Luzon. Bounded on the NW., & W along lines 49-1-2 by Proc 10 Forbes
Park Reservation; on the N, W, E along lines 2-3-4-5-6 by Lot 2 of the consolidation
subdivision plan; on the N. along line 7-8 by Residential Sec C; on the NE. & N
along lines 8-9-10 by Baguio Country Club; on the E. along line 10-11 by Lot 11; on
the E, N, W. along lines 11-12-13-14 by Lot 20; on the NE. along line 14-15 by Lot
11 (portion); both of the consolidation subd. plan on the SE, NE, E. along lines 15-1617-18 by Republic of the Philippines Camp John Hay, TCT No. 3812; on the S. along
line 18-19 by Lot 6; on the S. and SW. along lines 19-20-21-22 by Lot 5; on the SW.
along lines 22-23-24-25 by lot 4; on the W. and SW. along lines 25-26-27-28-29-30
and along lines 30-31-32-33-34-35-36-37 on the S, SE, E. & NE. by Lot 3; on the SE. &
NE. along lines 37-38-39-40-41 by Lot 4; on the S. along line 41-42 by Lot 7; on the
S, SW, SE, W., along lines 42-43-44-45-46-47-48-49 by Lot 8, all of the consolidation
subd. plan. Beginning at a point marked `1 on plan, being S. 12 deg. 39W., 90.62 m.
from triangulation station Baguio, thence,
thence
thence

137

N.
S.

07
70

deg.
deg.

54
13

W.,
E.,

66.29 m.
117.94 m.

to point 2;
to point 3;

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

N.
N.
N.
N.
N.
S.
N.
S.
S.
S.
N.
S.
S.
S.
S.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
N.
N.
N.
S.
S.
N.
N.

Laws on Bases Conversion

03
81
74
07
72
46
69
05
00
78
02
20
58
40
11
70
71
41
85
37
32
29
58
15
07
28
37
70
32
05
52
65
45
29
35
34
54
40
87
75
54
30
72
75
51

deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.

41
41
34
46
06
50
39
12
19
10
40
57
50
45
47
40
19
32
39
50
18
30
52
53
14
46
23
06
48
35
47
47
33
17
46
22
54
22
45
30
38
31
35
48
11

E.,
W.,
W.,
W.,
E.,
E.,
E.,
E.,
E.,
E.,
W.,
E.,
W.,
E.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
E.,
E.,
E.,
E.,
W.,
W.,
E.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,

50.31 m.
86.17 m.
34.64 m.
122.93 m.
841.68 m.
205.17 m.
72,60 m.
57.48 m.
27.75 m.
49.72 m.
30.00 m.
107.18 m.
82.83 m.
84.51 m.
227.86 m.
63.54 m.
72.24 m.
82.01 m.
18.86 m.
42.27 m.
35.30 m.
102.43 m.
14.45 m.
70.81 m.
46.82 m.
65.44 m.
185.10 m.
43.27 m.
28.68 m.
47.20 m.
46.05 m.
36.67 m.
85.32 m.
158.24 m.
43.40 m.
61.20 m.
93.16 m.
140.03 m.
513.91 m.
54.90 m.
58.94 m.
57.79 m.
34.64 m.
104.06 m.
51.66 m.

to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point 15;
to point 16;
to point 17;
to point 18;
to point 19;
to point 20;
to point 21;
to point 22;
to point 23;
to point 24;
to point 25;
to point 26;
to point 27;
to point 28;
to point 29;
to point 30;
to point 31;
to point 32;
to point 33;
to point 34;
to point 35;
to point 36;
to point 37;
to point 38;
to point 39;
to point 40;
to point 41;
to point 42;
to point 43;
to point 44;
to point 45;
to point 46;
to point 47;
to point 48;

138

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

thence
thence

N.
N.

31
55

deg.
deg.

58
37

W.,
E.,

24.95 m.
153.69 m.

to point 49;
to the point of

beginning; containing an area of Five Hundred Twenty Seven Thousand Seventy Five
(527,075) Square Meters more or less. All points referred to are indicated on plan and
are marked on the ground as follows: Points 6,7,8,16,17,18 by old square mons. 15
x 15 cms.; rest are square mons. 15 x 15 cms. marked BCDA. Bearings true; Date of
consolidation subdivision survey on January 19, 1993 and April 07, 1993, executed by
Engr. Dionisio M. Ines and was approved on August 26, 1993.
Lot 2, Ccs-131102-000030
Bases Conversion & Devt, Authority
HALF WAY HOUSE
A parcel of land (Lot 2, Ccs-131102-000030 being a portion of consolidated lots of
II-5958 (portion) and Lot 1, II-5958 Amd.) situated at Res. Sec. 3, City of Baguio,
Island of Luzon. Bounded on the N., E., and S., along lines 5-1-2-3-4 by Lot I of the
consolidation subdivision plan; on the W., along line 4-5 by Forbes Park Reservation
Proc. 10. Beginning at a point marked 1 on plan, being equal to corner 1, triangulation
station Baguio, thence,
thence
thence
thence
thence
thence

S.
S.
N.
N.
S.

81
03
70
07
74

deg.
deg.
deg.
deg.
deg.

41
41
13
54
34

E.,
W.,
W.,
W.,
E.,

86.17 m.
50.31 m.
117.94 m.
32.29 m.
34.64 m.

to point 2;
to point 3;
to point 4;
to point 5;
to the point of

beginning; containing an area of Four Thousand Five Hundred Fifteen (4,515) Square
Meters more or less. All points referred to are indicated on plan and are marked on the
ground as follows: Point 5 by old square mons. 15 x 15 cms. & rest by square mons.
15 x 15 cms. marked BCDA. Bearings true; Date of consolidation subdivision survey
on January 19, 1993 and April 07, 1993, executed by Engr. Dionisio M. Ines and was
approved on August 26, 1993.
Lot 3, Ccs-131102-000030
Bases Conversion & Devt. Authority
MILE HI
A parcel of land (Lot 3, Ccs-131102-000030 being a portion of consolidated lots of
TT-5958 (portion) and Lot 1, TT-5958 Amd.) situated at Res. Sec. 3, City of Baguio,
Island of Luzon. Bounded on the E., SW;, W., NW., N., and NE., along lines 1-2-3-45-6-7-8-9-10-11-12-1 by Lot I of the consolidation subdivision plan. Beginning at a
point marked 1 on plan being S. 89 deg., 22 E., 7.71.31 m. from triangulation station
Baguio thence;

139

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

S.
N.
N.
N.
N.
N.
N.
N.
S.
S.
S.
S.

58
29
45
65
52
05
32
70
37
28
07
15

deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.

52
17
33
47
47
35
48
06
23
46
14
53

W.,
W.,
W.,
W.,
W.,
W.,
E.,
E.,
E.,
E.,
E.,
E.,

14.45 m.
158.24 m.
85.32 m.
36.67 m.
46.05 m.
47.20 m.
28.68 m.
43.27 m.
185.10 m.
65.44 m.
46.82 m.
70.81 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to the point of

beginning; containing an area of Twenty Thousand One Hundred Ninety Nine (20,199)
Square Meters more or less. All points referred to are indicated on plan and are marked
on the ground as follows: all points by square mon. 15 x 15 cms. marked BCDA.
Bearings true; Date of consolidation subdivision survey on January 19, 1993 and April
07, 1993, executed by Engr. Dionisio M. Ines and was approved on August 26, 1993.
Lot 4, Ccs-131102-000030
Bases Conversion & Devt. Authority
CONFERENCE CLUSTER
A parcel of land (Lot 4, Ccs-131102-000030 being a portion of consolidated lots of II5958 (portion) and Lot 1, II-5958 Amd.) situated at Res. Sec. 3, City of Baguio, Island
of Luzon. Bounded on the E., and SE., along lines 1-2-3-4-5 by Lot 5; on the S., along
line 5-6 by Lot 7; on the NW., and SW., along lines 6-7-8-9-10 by Lot 1 (portion); on
the NE., along lines 10~11-12-1 by Lot 1 (portion), all of the consolidation subdivision
plan. Beginning at a point marked 1 on plan being S. 78 deg., 51 E., 870.35 m. from
triangulation station Baguio, thence;
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

S.
S.
S.
S.
N.
N.
N.
N.
N.
S.
S.
S.

Laws on Bases Conversion

05
32
16
18
86
40
54
34
35
29
32
37

deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.

37
26
48
55
33
22
54
22
46
30
18
50

W.,
W.,
W.,
E.,
W.,
E.,
W.,
E.,
E.,
E.,
E.,
E.,

7.15 m.
81.46 m.
13.25 m.
13.36 m.
125.97 m.
140.03 m.
93.16 m.
61.20 m.
43.40 m.
102.43 m.
35.30 m.
42.27 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to the point of

140

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

beginning; containing an area of Twenty Thousand Six Hundred Fifty (20,650) Square
Meters more or less. All points referred to are indicated on plan and are marked on the
ground as follows: all points by square mons. 15 x 15 cms. marked BCDA. Bearings
true; Date of consolidation subdivision Survey on January 19, 1993, executed by Engr.
Dionisio M. Ines and was approved on August 26, 1993.
Lot 5, Ccs-131102-000030
Bases Conversion & Devt. Authority
IGOROT LODGE
A parcel of land (Lot 5, Ccs-131102-000030 being a portion of consolidated lots of
IT-5958 (portion) and Lot 1, TI-5958 Amd.) Situated at Res. Sec. J, City of Baguio,
Island of Luzon. Bounded on the NE., and N. along lines 18-1-2-3 by Lot 1; on the SE.,
and S., along lines 3-4-5-6-7-8-9-10 by Lot 6; on the SW., along lines 10-11-12 by Lot
7; on the NW., and W., along lines 14-15-16-17-18 by Lot 4, all of the consolidation
subdivision. Beginning at a point marked 1 on plan being S. 78 deg., 59 E. from
triangulation station Baguio; thence;
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

S.
S.
S.
S.
S.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.

41
71
41
54
71
88
83
81
74
60
49
40
30
18
16
32
05
85

deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.

32
19
20
52
06
12
48
46
35
24
02
02
18
55
48
26
37
39

E.,
E.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
E.,
E.,
E.,

82.01
72.24
61.28
19.05
18.16
28.12
15.02
15.16
14.94
15.26
14.98
13.32
13.24
13.36
13.25
81.46
7.15
18.86

m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.

to point 2;
to point 3;
to point 4;
to point S;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point 15;
to point 16;
to point 17;
to point 18;
to the point of

beginning; containing an area of Sixteen Thousand Fifty Nine (16,059) Square Meters
more or less. All points referred to are indicated on plan and are marked on the ground
as follows: all points by square monuments 15 x 15 cms. marked BCDA. Bearings
true; Date of consolidation subdivision survey on January 19, 1993, executed by Engr.
Dionisio M. Ines and was approved on August 26, 1993.

141

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

Lot 6, Ccs-131102-000030
Bases Conversion & Devt. Authority
ACCOMODATION CLUSTER
A parcel of land (Lot 6, Ccs-131102-000030 being a portion of consolidated lots of II5958 (portion) and Lot 1, II-5958 Amd.) situated at Res. Sec. J, City of Baguio, Island
of Luzon. Bounded on the SW., along line 1-2 by Lot 7; on the NE. and NW., along
lines 2-3-4-S-6-7-8-9 by Lot 5; on the N., along line 9-10 by Lot 1, of the consolidation
subdMsiOn plan; on the SE., and S., along lines 10-11-1 by Republic of the Philippines
Camp John Hay, TCT No. T- 3812. Beginning at a point marked 1 on plan being S.
65 deg., 26 E., 1840.39 m. from triangulation station Baguio, thence;
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

N.
S.
S.
S.
S.
N.
N.
N.
S.
S.
N.

37
74
81
83
88
71
54
41
70
26
89

deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.

50
35
46
48
12
06
52
20
40
00
34

W.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
W.,
W.,

156.83 m.
14.94 m.
15.16 m.
15.02 m.
28.12 m.
18.16 m.
19.05 m.
61.28 m.
63.54 m.
175.01 m.
32.72 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to the point of

beginning; containing an area of Sixteen Thousand Eight Hundred Ninety (16,890)


Square Meters more or less. All Points referred to are indicated on plan and are marked
on the ground as follows: all points by square monuments 15 x 15 cms. marked BCDA.
Bearings true; Date of consolidation subdivision survey on January 19, 1993, executed
by Engr. Dionisio M. Ines and was approved on August 26, 1993.
Lot 7, Ccs-131102-000030
Bases Conversion & Devt. Authority
PROTECTED FOREST
A parcel of land (Lot 7, Ccs-131102-000030 being a portion of consolidated lots of II5958 (portion) and Lot 1, II-5958 Amd.) situated at Res. Sec. J, City of Baguio, Island
of Luzon. Bounded on the N., along line 1-2 by Lot 4; on the NE., along lines 2-3-45-6- by Lot 5;, along line 6-7 by Lot 6 all of the consolidation subdivision plan; on
the S., SW., E., SE., along lines 7-8-9-10- 11-12 by Republic of the Philippines Camp
John Hay, TCT No. T-3812; on the SW, S., and W along lines 12-13-14-15-16-17-18
by Lot 8; on the N., along line 18-1 by Lot 1, both of the consolidation subdivision
plan. Beginning at a point marked 1 on plan being S. 69 deg., 03 E., 732.92 m. from
triangulation station Baguio, thence;

Laws on Bases Conversion

142

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

S.
S.
S.
S.
S.
S.
N.
N.
S.
S.
S.
N.
N.
N.
N.
N.
N.
S.

86
30
40
49
60
37
89
56
69
13
71
11
43
87
61
02
04
87

deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.

33
18
02
02
24
50
34
23
31
39
29
57
46
29
57
38
09
45

E.,
E.,
E.,
E.,
E.,
E.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
W.,
E.,

125.97 m.
13.24 m.
13.32 m.
14.98 m.
15.26 m.
156.83 m.
163.78 m.
263.92 m.
195.62 m.
70.42 m.
31.21 m.
54.13 m.
39.41 m.
97.14 m.
29.86 m.
52.12 m.
38.37 m.
513.91 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point,15;
to point 16;
to point 17;
to point 18;
to the point of

beginning; containing an area of Seventy Four Thousand One Hundred Thirty Eight
(74,138) Square Meters more or less. All points referred to are indicated on plan and
are marked on the ground as follows: points 8-11 by old square monuments 15 x
15 cms. and rest by square mon. 15 x15 cms. marked BCDA. Bearings true; Date of
consolidation subdivision survey on January 19, 1993, executed by Engr. Dionisio M.
Ines and was approved on August 26, 1993.
Lot 13, Ccs-131102-000030
Bases Conversion & Devt. Authority,
U.S. AMBASSADOR ESTATE
A parcel of land (Lot 13, Ccs-131102-000030 being a portion of consolidated lots of II5958 (portion) and Lot 1, II-5958 Amd.) situated at Res. Sec. J, City of Baguio, Island
of Luzon. Bounded on the NE., along line 1-2 by Lot 21; on the NE., E., and SE., along
lines 2-3-4-5-6- by Lot 12; on the S., along line 6-7 by Lot 14; on the SW., and W.,
along lines 7-8-9-10-11-12 by Lot 15, all of the consolidation subd.; on the NW., & W.
along lines 12-13-1 by Republic of the Philippines Camp John Hay, TCT No. T-3812;
Beginning at a point marked 1 on plan being S. 52 deg., 49 E., 1589.63 m. from
triangulation station Baguio, thence;
thence
thence
thence
thence
thence
thence

143

S.
S.
S.
S.
S.
N.

55
35
20
16
33
72

deg.
deg.
deg.
deg.
deg.
deg.

46
58
31
10
56
08

E.,
E.,
E.,
W.,
W.,
W.,

95.26 m.
143.79 m.
268.54 m.
393.50 m.
68.38 m.
212.32 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

thence
thence
thence
thence
thence
thence
thence

N.
N.
N.
N.
N.
N.
N.

37
18
10
09
23
46
02

deg.
deg.
deg.
deg.
deg.
deg.
deg.

23
57
03
41
01
57
59

W.,
E.,
E.,
W.,
W.,
E.,
E.,

235.98 m.
86.29 m.
277.82 m.
40.59 m.
17.88 m.
234.60 m.
31.75 m.

to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to the point of

beginning; containing an area of Two Hundred Seventy Four Thousand Seven Hundred
Sixty (274,760) Square Meters more or less. All points referred to are indicated on plan
and are marked on the ground as follows: all points by square monuments 15 x 15 cms.
marked BCDA. Bearings true; Date of consolidation subdivision survey on January 19,
1993, executed by Engr. Dionisio M. Ines and was approved on August 26, 1993.
Lot 14, Ccs-131102-000030
Bases Conversion & Devt. Authority
VOICE OF AMERICA
A parcel of land (Lot 14, Ccs-131102-000030 being a portion of consolidated lots of II5958 (portion) and Lot 1, II-5958 Amd.) situated at Res. Sec. 3, City of Baguio, Island
of Luzon. Bounded on the S., SW., and NW., along lines 6-7-1-2 by Lot 15; on the. N.,
along line 2-3 by Lot 13; along lines 3- 4-5 by Lot 12; all of the consolidation subd.
plan; on the E., along line 5-6 by Executive Proclamation No. 414 dated January 25,
1907 and August 30, 1916 Disposable under Commonwealth Act No. 139 for Mining
Purposes. Beginning at a point marked 1 on plan being S. 23 deg., 51 E., 2171.73
m. from triangulation station Baguio, thence;
thence
thence
thence
thence
thence
thence
thence

N.
S.
S.
S.
S.
S.
N.

51
72
72
90
21
81
51

deg.
deg.
deg.
deg.
deg.
deg.
deg.

36
08
14
00
58
33
48

E.,
E.,
E.,
E.,
W.,
W.,
W.,

377.96 m.
212.32 m.
321.77 m.
59.08 m.
515.63 m.
131.00 m.
688.84 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to the point of

beginning; containing an area of Three Hundred Eighteen Thousand Three Hundred


Seventy Five (318,375) Square Meters more or less. All points referred to are indicated
on plan and are marked on the ground as follows: all points by square monuments 15
x 15 cms. marked BCDA. Bearings true; Date of consolidation subdivision survey on
January 19, 1993, executed by Engr. Dionisio M. Ines and was approved on August
26, 1993.

Laws on Bases Conversion

144

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

Lot 15, Ccs-131102-000030


Bases Conversion & Devt. Authority
PROTECTED FOREST
A parcel of land (Lot 15, CCS-131102-000030 being a portion of consolidated lots
of II-5958 (portion) and Lot 1, II-5958 Amd.) situated at Res. Sec. 3, City of Baguio,
Island of Luzon. Bounded on the SE., NE., and N., along lines 23-1-2-3 by Lot 14 of the
consolidation subdivision plan; on the E., along lines 3-4-5 by Executive Proclamation
No. 414 dated Jan. 25, 1907 and August 30, 1916 Disposable under Commonwealth
Act No. 139 for Mining Purposes; on the S., and SW., along line 5-6-7-8-9 by Lot 18;
on the SW., along line 9-10 by Kennon Hillside Subdivision Relocation Project; on the
line 10-11 by Lot 17; on the W., N., and SW., along lines 11-12-13-14-15-16 by Lot 16,
both of the consolidation subd. plan; on the NW., along lines 16-17-18 by Republic
of the Philippines Camp John Hay TCT No. T-3812; on the NE., and E., along lines 1920-21-22-23 by Lot 13 of the consolidation subd. plan. Beginning at a point marked
1 on plan being S. 23 deg., 51 E., 2171.73 m. from triangulation station Baguio,
thence;
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

S.
N.
S.
S.
S.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
S.
S
S.
S.
S.
S.

51
81
32
32
81
51
47
82
52
52
13
09
17
66
25
58
46
23
09
10
18
37
51

deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.
deg.

48
33
10
10
10
32
08
22
51
54
21
13
30
04
55
17
57
00
41
03
57
23
36

E.,
E.,
E.,
E.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
E.,
W.,
E.,
E.,
E.,
E.,
W.,
W.,
E.,
W.,

688.84 m.
130.99 m.
91.44 m.
71.56 m.
407.23 m.
165.07 m.
139.13 m.
189.70 m.
32.83 m.
211.82 m.
264.79 m.
129.15 m.
66.39 m.
108.82 m.
188.89 m.
285.77 m.
378.16 m.
17.88 m.
40.59 m.
277.82 m.
86.29 m.
235.98 m.
377.96 m

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point 15;
to point 16;
to point 17;
to point 18;
to point 19;
to point 20;
to point 21;
to point 22;
to point 23;
to the point of

beginning; containing an area of Five Hundred Seventy Four Thousand Four Hundred
Eighty (574,480) Square Meters more or less. All points referred to are indicated on
plan and are marked on the ground as follows: all points by square monuments 15 x

145

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

1.5 cms. marked BCDA. Bearings true; Date of consolidation subdivision survey on
January 19, 1.993, executed by Engr. Dionisio M. Ines and was approved on August
26, 1993.
Lot 20, Ccs-131102-000030
Bases Conversion & Devt. Authority
POWER HOUSE
A parcel of land (Lot 20, Ccs-131102-000030 being a portion of consolidated lots of
II-5958 (portion) and Lot 1, II-5958 Amd.) situated at Res. Sec. J, City of Baguio,
Island of Luzon. Bounded on the N., along line 1-2 by Lot 11; E., S., and W., along
lines 2-3-4-1 by Lot 1, both of the consolidation subdivision plan. Beginning at a point
marked 1 on plan being Nt. 81 deg., 03 E., 1044.94 m. from triangulation station
Baguio, thence;
thence
thence
thence
thence

S.
S.
N.
N.

80
02
78
00

deg.
deg.
deg.
deg.

27
40
10
19

E.,
E.,
W.,
W.,

48.08
30.00
49.72
27.75

m.
m.
m.
m.

to point 2;
to point 3;
to point 4;
to the point of

beginning; containing an area of One Thousand Three Hundred Seventy Eight (1,378)
Square Meters more or less. All points referred to are indicated on plan and are marked
on the ground as follows: all points by square monuments 15 x 15 cms. marked BCDA.
Bearings true; Date of consolidation subdivision survey on January 19, 1993, executed
by Engr. Dionisio M. Ines and was approved on August 26, 1993.
TCT NO. 62878
Lot No. 3
Psd-131102-002639
A parcel of land (Lot 3, Psd-131102-002639 being a portion of TCT No. T-3812,
LRC Rec. No. 87), situated at City Of Baguio, Province of Benguet, Island of Luzon.
Bounded on the N., E., and W., along lines 1-2-3-4-5-6 by Camp John Hay Property,
II-5958; on the E., & NE., along lines 6-7-8 by Lot 4; on the S, SW, and SE, along lines
8-9-10-11 by Lot 9; on the SW, S, and SE, along lines 11-12-13-14 by Lot 10; on the S,
W, and E., along lines 14-15-16-17-18-19-20 by Lot 1 on the NW, NE, and SW, along
lines 20-21-22-23-24-25-1 by Lot 2, all of the subd. plan. Beginning at a point marked
1 on plan being S, 37 deg., 39 E., 545.49 m. from triangulation Baguio, thence;
N.
N.
N.
S.
S.
S.
S.

71
13
69
56
89
06
57

Laws on Bases Conversion

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

29
39
31
23
34
41
17

E.,
E.,
E.,
E.,
E.,
E.,
E.,

31.21 m.
70.42 m.
195.62 m.
263.92 m.
196.50 m.
49.66 m.
67.24 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;

146

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

S.
N.
S.
N.
S.
S.
N.
N.
N.
S.
S.
N.
N.
N.
S.
N.
N.
N.

67
79
53
17
73
62
84
03
80
03
79
10
35
27
76
66
27
47

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

24
01
07
52
47
42
24
20
00
16
21
48
44
22
02
56
25
27

W.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
W.,
W.,
W.,
W.,
E.,
E.,
E.,
E.,
W.,
W.,

30.88 m.
80.12 m.
74.21 m.
67.62 m.
215.18 m.
245.27 m.
53.50 m.
55.08 m.
82.18 m.
67.32 m.
134.66 m.
24.22 m.
21.95 m.
110.58 m.
61.25 m.
122.22 m.
54.56 m.
47.48 m.

to point 9;
to Point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point 15;
to point 16;
to point 17;
to point 18;
to point 19;
to point 20;
to point 21;
to Point 22;
to point 23;
to point 24;
to point 25;
to point of

beginning, containing an area of ONE HUNDRED FORTY ONE THOUSAND ONE


HUNDRED SEVENTY EIGHT (141,178) SQUARE METERS, more or less. All points
referred to are indicated on plan and are marked on the ground by square monuments
on top marked BCDA; Bearings True; Date of subdivision survey on January 19, 1993
and April 7, 1993, executed by Engr. Dionisio M. Ines and was approved on August
16, 1993.
TCT No. 62879
Lot No. 4
Psd-131102-002639
A parcel of land (Lot 4, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at City of Baguio, Province of Benguet, Island of Luzon. Bounded
on the SW., and W., along lines 9-1-2 by Lot 3 of the subdivision plan; on the NW.,
along line 2-3 by Camp John Hay Property, 5958; on the NE., along line 3-4 by Lot 5;
on the E., along line 4-5-6 by Lot 6; on the S., along line 6-7 by Lot 8; on the SW., and
W., along lines 7-8-9 by Lot 9, all of the subdivision plan. Beginning at a point marked
1 on plan being S. 63 deg., 55 E., 1096.39 m. from triangulation BAGUIO, thence;
N.
N.
S.
S.
S.
S.
N.

147

06
26
54
02
13
85
69

deg.,
deg.,
deg.
deg.,
deg.,
deg.,
deg.,

41
00
07
46
14
26
40

W.,
E.,
E.,
E.,
E.,
W.,
W.,

49.66 m.
175.01 m.
155.62 m.
46.10 m.
154.85 m.
83.36 m.
93.53 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

N.
N.

20
57

deg., 54
deg., 17

W.,
W.,

20.52 m.
67.24 m.

to point 9;
to point of

beginning, containing all area of FORTY FOUR THOUSAND SIX HUNDRED SIXTY
SEVEN (44,667) SQUARE METERS, more or less. All points referred to are indicated
on plan and are marked on the ground by square monuments on top marked BCDA;
Bearings true; Date of subdivision survey on January 19, 1993 and April 7, 1993,
executed by Engr. Dionisio M. Ines and was approved on August 16, 1993.
TCT No. 62880
Lot No. 5
Psd-131102-002639
A parcel of land (Lot 5, Psd-131102-002639 being a portion of TCT No. T-3812,
LRC Rec. No. 87), situated at City of Baguio, Province of Benguet, Island of Luzon.
Bounded on the W., along line 1-2 by Camp John Hay Property II-5958; on the N., E.,
and SE., along lines 2-3-4-5-6-7 by Lot 6; on the S., along line 7-1 by Lot 4, both of
the subdivision plan. Beginning at a point marked 1 on plan being S. 75 deg., 23 E.,
1091.02 m. from triangulation BAGUIO, thence;
N.
S.
S.
S.
S.
S.
N.

11
75
01
16
45
16
54

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

47
05
12
38
33
37
07

E.,
E.,
W.,
W.,
W.,
W.,
W.,

227.86 m.
180.11 m.
53.05 m.
41.67 m.
57.95 m.
140.18 m.
155.62 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point of

beginning, containing an area of FORTY TWO THOUSAND SIX HUNDRED SIXTY


ONE (42,661) SQUARE METERS, more or less. All points referred to are indicated on
plan and are marked on the ground by square monuments on top marked AR BCDA;
Bearings True; Date of subdivision survey on January 19, 1993 and April 7, 1993,
executed by Engr. Dionisio M. Ines and was approved on August 16, 1993.
TCT NO. 62881
Lot No. 6
Psd-131102-002639
A parcel of land (Lot 6, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at City of Baguio, Province of Benguet, Island of Luzon. Bounded
on the W., along lines 1-2-3 by Lot 4; on the NW., W., and S., along lines 3-4-5-6-7-8
by Lot 5, both of the subdivision plan; on the SW., and NW., along lines 8-9-10 by
Camp John Hay Property, II-5958; on the N., NE., SE., and E., along lines 10-11-1213-14-15 by Lot 7; on the S., along line 15-1 by Lot 8, both of the subdivision plan.
Beginning at a point marked 1 on plan being S. 65 deg., 12 E., 1343.29 m. from
Laws on Bases Conversion

148

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

triangulation BAGUIO, thence;


N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
S.
S.
S.
S.
N.

13
02
16
45
16
01
75
40
58
74
34
53
50
04
88

deg.,
deg.,
deg.,
deg.,
deg.
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

14
46
37
33
38
12
05
45
50
13
53
04
41
06
36

W.,
W.,
E.,
E.,
E.,
E
W.,
W.,
E.,
E.,
E.,
E.,
W.,
E.,
W.,

154.85 m.
46.10 m.
140.18 m.
57.95 m.
41.67 m
53.05 m.
180.11 m.
84.51 m.
82.83 m.
109.13 m.
53.96 m.
247.97 m.
272.13 m.
283.66 m.
42.32 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point 15;
to point of

beginning, containing an area of SEVENTY THOUSAND FIVE HUNDRED SIXTY


SEVEN (70,567) SQUARE METERS, more or less. All points referred to are indicated
on plan and are marked on the ground by square monuments on top marked BCDA;
Bearings True; Date of subdivision survey on January 19, 1993 and April 7, 1993,
executed by Engr. Dionisio M. Ines and was approved on August 16, 1993.
TCT No. 62882
Lot No. 7
Psd-131102-002639
A parcel of land (Lot 7, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
(Rec. No. 87), situated at City of Baguio, Province of Benguet, Island of Luzon. Bounded
on the SW., along line 1-2 by .Lot 17; on the NW., and W., along lines 2-3-4 by Lot
8; on the W., NW., SW., and S., along lines 4-5-6-7-8-9 by Lot 6, all of the subdivision
plan; on the NW, NE, and E., along lines 9-10-11-12-13 by Camp John Hay Property,
II-5958; on the SW., along lines 13-14-1 by Lot 18 of the subdivision plan. Beginning
at a point marked 1 on plan being S. 53 deg., 28 E., 1482.99 m. from triangulation
BAGUIO, thence;
N.
N.
N.
N.
N.
N.
N.
S.

149

25
56
04
04
50
53
34
74

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

29
36
00
06
41
04
53
13

W.,
E.,
E.,
W.,
E.,
W.,
W.,
W.,

106.20 m.
125.82 m.
153.53 m.
283.66 m.
272.13 m.
247.97 m.
53.96 m.
109.13 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

N.
S.
S.
S.
N.
N.

58
50
21
02
55
26

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

50
42
49
59
46
01

E.,
E.,
W.,
W.,
W.,
W.,

195.39 m.
344.59 m.
737.50 m.
213.61 m.
66.78 m.
44.87 m.

to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point of

beginning, containing an area of ONE HUNDRED THIRTY SEVEN THOUSAND SIX


HUNDRED TWO (137,602) SQUARE METERS, more or less. All points referred to are
indicated on plan and are marked oil BCDA; Bearings True; Date of subdivision survey
on January 19, 1993, and April 7, 1993, executed by Engr. Dionisio M. Ines and was
approved on August 16, 1993.
TCT NO. 62883
Lot No. 8
Psd-131102-002639
A parcel of land (Lot 8, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at City of Baguio, Province of Benguet, Island of Luzon. Bounded
on the W., NW., and N., along lines 8-9-1-2.by Lot 9; on the N., along line 2-3 by Lot
4; along line 3-4 by Lot 6; on the E., and SE., along lines 4-5-6 by Lot 7; on the SW.,
and S., along lines 6-7-8 by Lot 17, all of the subdivision plan. Beginning at a point
marked 1 on plan being S. 61 deg., 17 E., 1239.03 m. from triangulation BAGUIO,
thence;
N.
N.
S.
S.
S.
N.
S.
N.
N.

63
85
88
04
56
25
83
11
34

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

06
26
36
00
36
31
55
17
48

W.,
E.,
E.,
W.,
W.,
W.,
W.,
W.,
E.,

55.65 m.
83.36 m.
42.32 m.
153.53 m.
125.82 m.
42.02 m.
103.12 m.
60.48 m.
128.25 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point of

beginning, containing an area of THIRTY EIGHT THOUSAND FOUR HUNDRED


EIGHTY NINE (38,489) SQUARE METERS, more or less. All points referred to are
indicated on plan and are marked on the ground by square monuments on top marked
BCDA; Bearings True; Date of subdivision survey on January 19, 1993 and April 7,
1993, executed by Engr. Dionisio M. Ines and was approved on August 16, 1993.

Laws on Bases Conversion

150

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

TCT NO. 62884


Lot No. 9
Psd-131102-002639
A parcel of land (Lot 9, Psd-131102-002639 being a portion of Lot TCT No. T-3812,
LRC Rec. No. 87), situated at the City of Baguio, Province of Benguet, Island of Luzon.
Bounded on the S., SE., and E., along lines 18-19-1-2 by Lot 8; on the E., and NE.,
along lines 2-3-4 by Lot 17; on the SE., along line 4-5 by Lot 18; on the SW., S., and W.,
along lines 5-6-7-8-9-10 by Lot 16; on the W., along line 10-11 by Lot 14; on the W.,
and N., along lines 1-1-12-13 by Lot 10; on the NW. NE., and hi., along lines 13-1415-16 by Lot 3; on the E., and NE., along lines 16-17-18 by Lot 4, all of the subdivision
plan. Beginning at a point marked 1 on plan being S. 55 deg., 2 E., 1232.05 m. from
triangulation BAGUIO, thence;
S.
11
deg., 17 E.,
60.48 m.
to point 2;
S.
13
deg., 22 E.,
167.70 m.
to point 3;
S.
60
deg., 59 E.,
34.30 m.
to point 4;
S.
64
deg., 39 W., 114.63 m.
to point 5;
N.
18
deg., 44 W., 42.19 m.
to point 6;
S.
73
deg., 11
W., 64.53 m.
to point 7;
N.
28
deg., 14 W., 15.32 m.
to point 8;
N.
00
deg., 39 E.,
39.04 m.
to point 9;
N.
86
deg., 08 W., 37.17 m.
to point 10;
N.
09
deg., 17 W., 271.67 m.
to point 11;
N.
09
deg., 17 W., 66.91 m.
to point 12;
N.
72
deg., 08 E.,
61.02 m.
to point 13;
N.
53
deg., 07 E.,
74.21 m.
to point 14;
S.
79
deg., 01 E.,
80.12 m.
to point 15;
N.
67
deg., 24 E.,
30.88 m.
to point 16;
S.
20
deg., 54 E.,
20.52 m.
to point 17;
S.
69
deg., 40 E.,
93.53 m.
to point 18;
S.
63
deg., 06 W., 55.65 m.
to point 19;
S.
34
deg., 48 W., 128.25 m.
to point of
beginning, containing an area of EIGHTY SEVEN THOUSAND THIRTY SEVEN
(87,037) SQUARE METERS more or less. All points referred to are indicated on plan
and are marked on tile ground by square monuments on top marked BCDA; Date of
subdivision survey on January 19, 1993 and April 7, 1993, executed by Engr. Dionisio
M. Ines and was approved on August 16, 1993.
TCT No. 62885
Lot No. 10
Psd-131102-002639
A parcel of land (Lot 10, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at the City of Baguio, Province of Benguet, Island of Luzon.

151

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

Bounded on the NW., N., and NE., along lines 13-14-1-2 by Lot 3; on the S., and E.,
along lines 2-3-4 by Lot 9; on the S., E., SE., and SW., along lines 4-5-6-7-8-9-10 by
Lot 14; on the W., and NW., along lines 10-11-12-13 by Lot 11, all of the subdivision
plan. Beginning at a point marked 1 on plan, being S. 59 deg., 54 E., 987.21 m. from
triangulation BAGUIO, thence;
S.
S.
S.
S.
S.
S.
S.
N.
N.
N.
N.
N.
N.
N.

17
72
09
67
15
72
62
72
05
14
49
05
62
73

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

52
08
17
04
29
30
31
27
36
42
32
23
42
47

E.,
W.,
E.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
E.,
E.,
E.,
E.,

67.62 m.
61.02 m.
66.91 m.
132.18 m.
82.99 m.
120.61 m.
92.91 m.
137.02 m.
25.95 m.
51.81 m.
81.10 m.
17.38 m.
245.27 m.
215.18 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point of

beginning; containing an area of Eighty Seven Thousand Five Hundred Eighty Six
(87,586) Square Meters, more or less. All points referred to are indicated on plan and
marked on the ground by square monuments on top marked BCDA; Bearings true;
date of subdivision survey on January 19, 1993 and April 7, 1993, executed by Engr.
Dionisio M. Ines and was approved on August 16, 1993.
TCT No. 62886
Lot No. 11
Psd-131102-002639
A parcel of land (Lot 11, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at the City of Baguio, Province of Benguet, Island of Luzon.
Bounded onthe SE., and E., along lines 1-2-3-4 by Lot 10; on the S., and E., along lines
4-5-6-7 by Lot 14; on the SE., along line 7-8 by Lot 12; on the SW., W., and NW., along
lines 8-9-10-11-12-13 by Lot 2; on the NE., N., and W., along lines 13-14-15-16-1718-1 by Lot 3, all of the subdivision plan.
Beginning at a point marked 1 on plan, being S. 32 deg., 45 E., 793.89 m. from
triangulation BAGUIO, thence;
S.
S.
S.
S.

05
49
14
88

Laws on Bases Conversion

deg.,
deg.,
deg.,
deg.,

23
32
42
04

W.,
W.,
W.,
W.,

17.38
81.10
51.81
62.07

m.
m.
m.
m.

to point 2;
to point 3;
to point 4;
to. point 5;

152

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

N.
S.
S.
N.
N.
N.
N.
N.
S.
N.
N.
S.
S.
S.

77
06
63
47
22
13
41
68
10
79
03
80
03
84

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

36
14
42
47
13
33
41
54
48
21
16
00
20
24

W.,
E.,
W.,
W.,
W.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
W.,
E.,

121.69 m.
36.73 m.
114.93 m.
91.57 m.
23.11 m.
29.59 m.
37.47 m.
138.73 m.
24.22 m.
134.66 m.
67.32 m.
82.18 m.
55.08 m.
53.50 m.

to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point 15;
to point 16;
to point 17;
to point 18;
to point of

beginning; containing an area of Fifty Two Thousand Thirty Five (52,035) Square
Meters, more or less. All points referred to are indicated on plan and marked on the
ground by square monuments on top BCDA; Bearings: true; Date of subdivision survey
on January 19, 1993 and April 7, 1993, executed by Engr. Dionisio M. Ines and was
approved on August 16, 1993.
TCT No. 62889
Lot No. 14
Psd-131102-002639
A parcel of land (Lot 14, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at the City of Baguio, Province of Benguet, Island of Luzon.
Bounded on the E., along line 1-2 by Lot 9; on the SE., and E., along lines 2-3-4 by Lot
16; on the S., along line 4-5 by I-or 15; on the SW., along lines 5-6-7 by Lot 12; on the
W., and N., along lines 7-8-9-10 by Lot 11; on the E., N., NW., and W., along lines 1011-12-1.3-14-15-1 by Lot 10, all of the subdivision plan. Beginning at a point marked
1 on plan, being S. 52 deg., 06 E., 1048.73 m. from triangulation station BAGUIO,
thence;
S.
S.
S.
S.
N.
N.
N.
S.
N.
S.
S.

153

09
65
12
77
39
55
06
77
88
05
72

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

17
04
12
00
37
14
14
36
04
36
27

E.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
E.,
E.,
E.,

271.67 m.
136.95 m.
51.15 m.
265.04 m.
213.36 m.
201.96 m.
36.73 m.
121.69 m.
62.07 m.
25.95 m.
137.02 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

N.
N.
N.
N.

62
72
15
67

deg.,
deg.,
deg.,
deg.,

31
30
29
04

E.,
E.,
E.,
E.,

92.91 m.
120.61 m.
82.99 m.
132.18 m.

to point 13;
to point 14;
to point 15;
to point of

beginning; containing an area of One Hundred Thirty Five Thousand Seven Hundred
Nine (135,709) Square Meters more or less. All points referred to are indicated on plan
and marked on the ground by square monuments on top BCDA; Bearings true; Date of
subdivision survey on January 19, 1993 and April 7, 1993, executed by Engr. Dionisio
M. Ines and was approved on August 16, 1993.
TCT No. 62890
Lot No. 15
Psd-131102-002639
A parcel of land (Lot 15, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at the City of Baguio, Province of Benguet, Island of Luzon.
Bounded on the N., along line 1-2 by Lot 14; on the NE., N., and W., along lines 2-34-5-6 by Lot 16; oil the NE., along line 6-7 by Lot 18, all of the subdivision plan; on
the SE., along lines 7-8-9-10 by Camp John Hay Property, II-5958; on the SW., along
lines 10-11-12 by Lot 1, II-5958 Amd., Camp John Hay Property; on the NW., along
line 12-13 by Lot 13; on the NW., and W., along lines 13-14-1 by Lot 12, both of the
subdivision plan. Beginning at a point marked 1 on Plan, being S. 23 deg., 53 E.,
1180.81 m. from triangulation BAGUIO, thence;
N.
S.
S.
N.
N.
S.
S.
S.
S.
N.
N.
N.
N.
N.

77
66
79
67
31
43
23
46
58
58
71
43
59
07

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

00
19
40
52
56
17
01
57
17
54
13
45
57
41

E.,
E.,
E.,
E.,
E.,
E.,
E.,
W.,
W.,
W.,
W.,
E.,
E.,
E.,

265.04 m.
155.92 m.
87.26 m.
27.90 m.
39.79 m.
106.80 m.
22.53 m.
378.15 m.
285.77 m.
308.20 m.
46.77 m.
206.53 m.
60.24 m.
128.75 m.

to point 2;
to point3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point of

beginning; containing an area of Two Hundred Forty One Thousand Seven Hundred
Eighty One (241,781) Square Meters, more or less. All points referred to are indicated
on plan and marked on the ground by square monuments on top marked BCDA;

Laws on Bases Conversion

154

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

Bearings true; Date of subdivision survey on January 19, 1993 and April 7, 1993,
executed by Engr. Dionisio M. Ines and was approved on August 16, 1993.
TCT No. 62891
Lot No. 16
Psd-131102-002639
A parcel of land (Lot 16, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at the City of Baguio, Province of Benguet, Island of Luzon.
Bounded on the NE., along line 1-2 by Lot 18; on the E., SE., and S., along lines 2-34-5-6 by Lot 15; on the W., and NW., along lines 6-7-8 by Lot 14; on the N., E., NE.,
and NW., along lines 8-9-10-11-12-1 by Lot 9, all of the subdivision plan; Beginning
at a point marked 1 on plan, being S. 45 deg., 03 E., 1399.53 m. from triangulation
station BAGUIO, thence;
S.
S.
S.
N.
N.
N.
N.
S.
S.
S.
N.
S.

17
31
67
79
66
12
65
86
00
28
73
18

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

48
56
52
40
19
12
04
08
39
14
11
44

E.,
W.,
W.,
W.,
W.,
E.,
E.,
E.,
W.,
E.,
E.,
E.,

68.52 m.
39.79 m.
27.90 m.
87.26 m.
155.52 m.
51.15 m.
136.95 m.
37.17 m.
39.04 m.
15.32 m.
64.53 m.
42.19 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point of

beginning; containing an area of Thirty Two Thousand Three Hundred Forty (32,340)
Square Meters, more or less. All points referred to are indicated on plan and marked
on the ground by square monuments on top marked BCDA; Bearings true; Date of
subdivision survey on January 19, 1993 and April 7, 1993, executed by Engr. Dionisio
M. Ines and was approved on August 16, 1993.
Lot No. 17
Psd-131102-002639
TCT No. 62892
A parcel of land (Lot 17, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at the City of Baguio, Province of Benguet, Island of Luzon.
Bounded on the SW., and W., along lines 7-1-2 by Lot 9; on the N., and NE., along
lines 2-3-4 by Lot 8; on the NE., along line 4-5 by Lot 7; on the SE., along lines 5-6-7
by Lot 18, all of the subdivision plan; Beginning at a point marked 1 on plan, being
S. 49 deg., 04 E., 1408.64 m. from triangulation BAGUIO, thence;

155

Laws on Bases Conversion

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

N.
N.
S.
S.
S.
S.
N.

13
83
25
25
61
47
60

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

22
55
31
29
16
16
59

W.,
E.,
E.,
E.,
W.,
W.,
W.,

167.70 m. to point 2;
103.12 m. to point 3;
42.02 m. to point 4;
106.20 m. to point 5;
100.81 m. to point 6;
12.50 m. to point 7;
34.30 m. to point of

beginning; containing an area of Nineteen Thousand Nine Hundred Ten (19,910)


Square Meters, more or less. All points referred to are indicated on plan and marked
on the ground by square monuments on top marked BCDA; Bearings true; Date of
subdivision survey on January 19, 1993 and April 7, 1993, executed by Engr. Dionisio
M. Ines and was approved on August 16, 1993.
TCT No. 62898
Lot No. 18
Psd-131102-002639
A parcel of land (Lot 18, Psd-131102-002639 being a portion of TCT No. T-3812, LRC
Rec. No. 87), situated at the City of Baguio, Province of Benguet, Island of Luzon.
Bounded on the NW., along line 1-2 by Lot 9; on the W., and NW., along lines 2-3-4
by Lot 17; on the NE., along lines 4-5-6 by Lot 7, all of the subdivision plan; on the E.,
and SE., along lines 6-7-8 by II-5958, Camp John Hay Property; on the W., along lines
8-9-10 by Lot 15; on the W., along line 10-1 by Lot 16, both of the subdivision plan.
Beginning at a point marked 1 on plan, being S. 45 deg., 03 E., 1399.53 m. from
triangulation station BAGUIO, thence;
N.
N.
N.
S.
S.
S.
S.
N.
N.
N.

64
47
61
26
55
02
46
23
43
17

deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,
deg.,

39
16
16
01
46
59
57
01
17
48

E.,
E.,
E.,
E.,
E.,
W.,
W.,
W.,
W.,
W.,

114.63 m.
12.50 m.
100.81 m.
4.4.87 m.
66.78 m.
31.75 m.
234.61 m.
22.53 m.
106.80 m.
68.52 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point of

beginning; containing an area of Thirty Eight Thousand Five Hundred Twenty One
(38,521) Square Meters, more or less. All points referred to are indicated on plan and
marked on the ground by square monuments on top marked BCDA; Bearings true;
Date of subdivision survey on January 19, 1993 and April 7, 1993, executed by Engr.
Dionisio M. Ines and was approved on August 16, 1993.

Laws on Bases Conversion

156

JOHN HAY SPECIAL ECONOMIC ZONE - Proclamation No. 1191

IN WITNESS THEREOF, I have hereunto set my hand and caused the seal of the
Republic of the Philippines to be affixed hereto. Done in the City of Manila, this 11th
day of December, in the year of our Lord, Two Thousand and Six.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

157

Laws on Bases Conversion

PORO POINT FREEPORT ZONE - Proclamation No. 216

Proclamation No. 216


Creating and Designating the Area Covered by the Former Wallace Air Station
and Contiguous Areas in Poro Point as Poro Point Special Economic
and Freeport Zone and Transferring Lands to the Bases Conversion
Development Authority Pursuant to Republic Act No. 7227
Pursuant to the powers vested in me by law and the resolutions of concurrence of the
local government units directly affected, I, FIDEL V. RAMOS, President of the Republic
of the Philippines, hereby create and designate the area covered by the Wallace Air
Station as embraced, covered and defined by the 1947 Military Bases Agreement
between the Philippines and the United States of America, as amended, and the other
contiguous lands located within the territorial jurisdiction of the Municipality of San
Fernando, Province of La Union, as Poro Point Special Economic and Freeport Zone
(Poro Point).
Section 1. Creation of Poro Point Special Economic and Freeport Zone.Poro Point
shall cover the land and bay areas which include the Wallace Air Station, the San
Fernando Airport, Seaport, Barangays Poro and San Vicente and portions of Barangays
San Agustin, San Francisco, and Canaoay of the Municipality of San Fernando, Province
of La Union, consisting of eight hundred (800) hectares, more or less, subject to actual
survey and verification by the Department of Environment and Natural Resources
(DENR). Areas that will be reclaimed from the adjoining shores of Poro Point shall
also be included in the Poro Point Special Economic and Freeport Zone.
Section 2. Transfer of Wallace Air Station Areas to the Bases Conversion Development
Authority.All areas covered by the Wallace Air Station as embraced and defined by
the 1947 Military Bases Agreement between the Philippines and the United States of
America, as amended, excluding those covered by Presidential Proclamations and
some 25 hectare area for the radar and communication station of the Philippine Air
Force, are hereby transferred to the Bases Conversion Development Authority (BCDA)
provided that the area now occupied by the Voice of America shall be considered
transferred to the BCDA only upon the turn-over of this property to the Republic of
the Philippines. Future reclaimed lands from adjoining shores of Poro Point shall be
considered transferred and owned by BCDA.
Section 3. Governing Body of Poro Point.Pursuant to Section 15 of R.A. 7227,
BCDA is hereby established as the governing body of the Poro Point Special Economic
and Freeport Zone. BCDA shall determine the utilization and disposition of the above
mentioned lands subject to private property rights. It shall promulgate the necessary
policies, rules and regulations to govern and regulate the Poro Point Special Economic
and Freeport Zone thru an operating and implementing arm it may establish or through
another entity/entities or joint venture with whom it may enter into a contract with for
its economic development and optimum utilization.

Laws on Bases Conversion

158

PORO POINT FREEPORT ZONE - Proclamation No. 216

Section 4. Operation of the Airport and SeaportThe development, operation and


management of the airport and seaport is hereby transferred to BCDA, subject to
policies, rules and regulations promulgated by Air Transportation Office, Civil Aviation
Authority and Philippine Ports Authority.
Section 5. Investment Climate in the Poro Point Special and Economic and Freeport
ZonePursuant to Section 5 (m) and Section 15 of R.A. 7227, BCDA shall promulgate
all necessary policies, rules and regulations governing Poro Point including investment
incentives, in consultation with the local government departments for implementation
by BCDA. Among others, Poro Point shall have all the applicable incentives in the
Subic Special Economic and Freeport Zone under R.A. 7227 and those applicable
incentives granted in the Export Processing Zones, the Omnibus Investment Code
of 1987, the Foreign Investment Act of 1991 and new investment laws which may
hereinafter be enacted.
Section 6. Role of Departments, Bureaus, Offices, Agencies and Instrumentalities.
All heads of departments, bureaus, offices, agencies and instrumentalities of the
governments are hereby directed to give full support to BCDA and/or its implementing
subsidiary or joint venture to facilitate the necessary approvals to expedite the
implementation of the various projects of the Conversion Program.
Section 7. Local Authority.Except as herein provided, the affected local government
units shall retain between BCDA and the local government units concerned in matters
affecting the Poro Point, other than defense and security, the decision of BCDA shall
prevail.
Section 8. Repealing Clause.All presidential acts letters of instruction, executive
orders, rules and regulations or parts thereof which are inconsistent with the provisions
of this Proclamation are hereby repealed, amended or modified accordingly.
Section 9. Effectivity.This proclamation shall take effect immediately.
DONE in the City of Manila, this 27th day of July in the year of Our Lord, Nineteen
Hundred and Ninety-Three.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:
(Sgd.) TEOFISTO T. GUINGONA, JR.
Executive Secretary

159

Laws on Bases Conversion

PORO POINT FREEPORT ZONE - Executive Order No. 132

Executive Order No. 132


Authorizing the Creation of the Poro Point Management Corporation
as the Implementing Arm of the Bases Conversion Development Authority
Over the Poro Point Special Economic and Freeport Zone and
Renaming the John Hay Poro Point Development Corporation
as the John Hay Management Corporation
WHEREAS, Section 4 (a) of Republic Act No. 7227, otherwise known as the Bases
Conversion Development Act of 1992 (RA 7227) authorizes the Bases Conversion
Development Authority (BCDA) to own, hold, and/or administer the former military
installations such as the John Hay Air Station in Baguio City and the Wallace Air Station
in Poro Point, San Fernando City, La Union;
WHEREAS, the BCDA is mandated under RA 7227 to adopt, prepare and implement
a comprehensive and detailed plan for the sound and balanced conversion of these
military reservations and their contiguous extensions consistent with the plans and
programs of the national government and the local government units;
WHEREAS, Executive Order No. 103 Series of 1993 [EO 103] created the John Hay
Development Corporation as the operating and implementing arm of the BCDA to
manage the Club John Hay created under Proclamation No. 198 issued on June 29,
1993;
WHEREAS, under Proclamation No. 420 issued on July 5, 1994, the John Hay Special
Economic Zone (JHSEZ) was created, designating a portion of the area covered by
the former John Hay reservation within its coverage and establishing the BCDA as the
governing body of the JHSEZ;
WHEREAS, Proclamation No. 216 issued on July 27, 1993 created the Poro Point
Special Economic and Freeport Zone (PPSEFZ) covering the land and bay areas which
include the Wallace Air Station, the San Fernando Airport, Seaport, Barangays Poro
and San Vicente and portions of Barangays San Agustin, San Francisco and Canaoay
of the Municipality of San Fernando, Province of La Union and establishing the BCDA
as the governing body of the PPSEFZ;
WHEREAS, Executive Order No. 31 issued on October 7, 1998 [EO 31] amended EO
103 and created the John Hay Poro Point Development Corporation (JPDC) as the
operating and implementing arm of BCDA to manage the JHSEZ and the PPSEFZ;
WHEREAS, Section 16 of RA 7227 authorizes the BCDA to form, establish, organize
and maintain subsidiaries in accordance with Philippine Corporation Law;

Laws on Bases Conversion

160

PORO POINT FREEPORT ZONE - Executive Order No. 132

WHEREAS, Section 17 of RA 7227 provides that the BCDA shall be under the direct
control and supervision of the Office of the President for purposes of policy direction
and coordination;
WHEREAS, there is a need to accelerate the development, management and utilization
of the JHSEZ and the PPSEFZ as self-sustaining and environmentally sound industrial,
commercial, financial, tourism, transshipment and investment centers;
WHEREAS, in order to separately focus on the development, management and
maximum utilization of the potentials and resources of the JHSEZ and the PPSEFZ,
and to provide administrative efficiency and strategic effectiveness in these economic
zones, there is a need to establish separate subsidiaries to serve as the operating and
implementing arm of the BCDA in the JHSEZ and the PPSEFZ.
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic
of the Philippines, by virtue of the powers vested in me by law, do hereby order:
Section 1. Creation of the Poro Point Management Corporation.A body corporate to
be known as the Poro Point Management Corporation (PPMC) is hereby authorized to
be formed as the operating and implementing arm of the BCDA to manage the PPSEFZ.
The PPMC shall be a subsidiary corporation of the BCDA and shall be formed in
accordance with the Philippine Corporation Law and existing rules and regulations
promulgated by the Securities and Exchange Commission [SEC] pursuant to Section
16 of RA 7227.
The PPMC shall be subject to the policies, rules and regulations of the BCDA.
The PPMC shall be exempt from the coverage of the Civil Service Laws, rules and
regulations.
Section 2. Capitalization, Powers and Functions of PPMC.The BCDA, as the
incorporator and holding company of the PPMC, shall determine the capitalization,
powers and functions of the PPMC, which shall be substantially similar to that of the
capitalization, powers and functions of the JPDC.
Section 3. Transfer of Powers, Functions, Rights, Assets, Liabilities, Personnel, etc.
All powers vested in, and the functions and duties heretofore conferred upon the JPDC
relating to the operation, management, utilization and development of the PPSEFZ
under existing laws, rules and regulations, and under its Articles of Incorporation and
By-Laws, including all of its rights, assets, liabilities and personnel, shall be transferred
to the PPMC upon its incorporation under the Philippine Corporation Law and rules
and regulations promulgated by the SEC. For this purpose, the BCDA is directed to
take all the necessary steps towards effecting the efficient transfer of powers, functions,
duties, rights, assets, liabilities and personnel from JPDC to PPMC.

161

Laws on Bases Conversion

PORO POINT FREEPORT ZONE - Executive Order No. 132

Section 4. Renaming the John Hay Poro Point Development Corporation as the
John Hay Management Corporation.The body corporate created under EO 103, as
amended by EO 31 known as the John Hay Poro Point Development Corporation
(JPDC) is hereby renamed as the John Hay Management Corporation (JHMC) and shall
be the operating and implementing arm of the BCDA over the JHSEZ. The BCDA is
further directed to cause the amendment of the Articles of Incorporation and By-Laws
of JPDC to implement this Executive Order.
Section 5. Implementation. BCDA shall implement this Executive Order within
a period of ninety (90) days from date of issuance of this Executive Order, including:
a. The incorporation of the PPMC as provided in Section 1 hereof;
b. The transfer of powers, functions, duties, rights, assets, liabilities and personnel
from JPDC to PPMC as provided in Section 3 hereof; and
c. The amendment of the Articles of Incorporation and By-Laws of JPDC as
provided in Section 4 hereof.
BCDA shall submit a report to the President on all the actions taken to implement this
Executive Order within fifteen (15) days after the PPMC shall have been established in
accordance with the Philippine Corporation Law, rules and regulations and approval
of the amendment of the Articles of Incorporation and By-Laws of JPDC by the SEC.
Section 6. Board of Directors.The powers of JHMC and PPMC shall be vested in
and exercised by a Board of Directors, both of which shall be composed of not more
than eleven (11) members each; Provided, That, at least one (1) director shall be the
BCDA Chairman and a second director shall be the BCDA President or his designated
representative, in accordance with Section 16 of RA 7227.
No person shall be nominated as a member of the Board representing the capital
stock of the national government in JHMC and PPMC unless he is a Filipino citizen,
of good moral character, and of recognized competence in relevant fields, including
but not limited to economics, tourism, management, international relations, law or
engineering.
Section 7. Role of Departments, Bureaus, Offices, Agencies and Instrumentalities.
All heads of departments, bureaus, offices, agencies and instrumentalities of the
government are hereby directed to give full support to the Poro Point conversion
program and to coordinate with BCDA to facilitate the necessary approvals to expedite
the implementation of various projects of the conversion program.
Section 8. Repealing Clause.Section 1 of Executive Order No. 31, s. 1998, insofar
as it pertains to the composition of the Board of Directors of JPDC, is hereby amended
by Section 6 hereof. All other executive issuances, rules and regulations or parts thereof
Laws on Bases Conversion

162

PORO POINT FREEPORT ZONE - Executive Order No. 132

which are inconsistent with this Executive Order are hereby revoked, amended, or
modified accordingly.
Section 9. Effectivity.This Executive Order shall take effect immediately.
DONE in the City of Manila, this 3rd day of October, in the year of our Lord, Two
Thousand and Two.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) AVELINO J. CRUZ, JR.


Acting Executive Secretary

163

Laws on Bases Conversion

BATAAN BUSINESS AND LEISURE PARK - Proclamation No. 984

Proclamation No. 984


Creating and Designating the Municipality of Morong, Province of Bataan,
Including the Area of the Philippine Refugee Processing Center Complex (PRPCC) as
the Morong Special Economic Zone Pursuant to Republic Act No. 7227
and Transferring the Land Comprising the PRPCC to the
Bases Conversion Development Authority (BCDA)
Pursuant to the powers vested in me by law and by virtue of the resolutions of
concurrence of the Sangguniang Bayan of Morong and the Sanggunian Panlalawigan
of Bataan and upon the recommendation of BCDA, I, FIDEL V. RAMOS, do hereby
create and designate the Municipality of Morong, Bataan, including the area covering
the Philippine Refugee Processing Center Complex (PRPCC) as the Morong Special
Economic Zone, and accordingly order:
Section 1. Creation of Morong Special Economic Zone. The Morong Special
Economic Zone (MSEZ) shall comprise the land area within the territorial jurisdiction
of Morong, Province of Bataan, including the 365.23-hectare Philippine Refugee
Processing Center Complex (PRPCC) based therein, per actual survey. Provided that
the portion of Morong delineated and made part of the Subic Special Economic and
Freeport Zone under Republic Act No. 7227, applicable laws and other implementing
issuances shall be excluded therefrom.
The PRPCC shall be the Main Zone of the MSEZ and the area outside the PRPCC but
within the territorial jurisdiction of Morong, Province of Bataan shall be the Sub-Zone
is for purposes of the application of investment incentives.
Section 2. Transfer of PRPCC to the Bases Conversion development Authority. The
ownership of all lands comprising the PRPCC and their improvements are hereby
transferred to BCDA, as per actual ground survey.
Delineating the metes and bounds of the former PRPCC by the following Technical
Descriptions:
A Parcel of Land (Consolidation of Lots 1384, 1385, 1386, 1387, 1390, 1403, 1412,
1415, 1416, 1422, 1506, 1507, 1508, 1509, 1584, 1679 all of CAD 252, Morong
Cadastre), situated in Barangay Sabang, Municipality of Morong, Province of Bataan,
Island of Luzon.
Bounded on the NW., along line 1-2-3 by Lot 1411, along line 3-4 by Lot 1589, along
line 4-5 by Lot 1409, along line 5-6 by Lot 1408, along line 6-7 by Lot 1405, along
line 7-8-9 by Lot 1676 all of CAD 262 Morong Cadastre; on the NE., along line 9-166
by Matico Creek, along line 166-173 by Forest zone; on the SE., along lines 173-202
by Morong River, along line 202-204 by Lot 1387, along line 205-206 by lot 1389,
along line 206-207 by Lot 1392, along line 207-208 by Lot 1393, along line 208-209
Laws on Bases Conversion

164

BATAAN BUSINESS AND LEISURE PARK - Proclamation No. 984

by Lot 1394, along line 209-210 by Lot 1396, along line 210-211 by Lot 1397, along
line 211-212 by Lot 1398, along line 212-213 by Lot 1399, along line 213-215 by Lot
1400, all of the CAD 262 Morong Cad., along line 215-225 by Morong River, along
line 225-227 by Lot 1423, along line 227-228 by Lot 1421, along line 228-229 by Lot
1420, along line 229-231 by Lot 1251, along line 231-232 by Lot 1590; on the SW.,
along line 232-233 by Lot 1418, along line 233-235 by Road Lot; along line 235-1
by Lot 2152, all of the CAD 262, Morong CAD.
Beginning at a point marked "1" on the plan being N. 19 deg. 01' E., 2718.94 m. from
BLLM 1 Morong CAD;
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

165

N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
S.
S.
S.
S.
N.
N.
N.
S.
S.
S.
S.
S.
S.
S.
S.
N.
N.

6
6
6
6
72
39
85
8
14
23
48
40
15
12
55
44
56
71
69
47
82
77
3
19
39
33
32
64
0
66
48
20
86
41

deg. 27
deg. 12
deg. 12
deg. 12
deg 21
deg 59
deg 3
deg. 17
deg. 57
deg. 33
deg. 43
deg. 10
deg. 25
deg. 2
deg. 33
deg. 21
deg. 57
deg. 45
deg. 32
deg. 42
deg. 8
deg. 43
deg. 53
deg. 22
deg. 51
deg. 21
deg. 59
deg. 52
deg. 10
deg. 55
deg. 42
deg. 59
deg. 27
deg. 10

W.,
W.,
W.,
W.
E.
E.,
E.,
W.,
E.,
W.,
E.,
E.,
W.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
W.,
W.,
E.,
E.,
E.,
E.,
E.,

164.66 m.
242.40 m.
104.79 m.
51.44 m.
327.94 m.
342.31 m.
261.50 m.
449.50 m.
28.76 m.
37.23 m.
16.67 m.
36.59 m.
34.08 m.
16.50 m.
36.88 m.
34.49 m.
23.97 m.
13.35 m.
41.85 m.
33.16 m.
14.69 m.
12.08 m.
14.01 m.
30.67 m.
15.50 m.
22.47 m.
24.02 m.
22.84 m.
17.98 m.
49.15 m.
20.05 m.
36.00 m.
6.47 m.
28.68 m.

to point 2;
to point 3;
to point 4;
to point 5;
to point 6;
to point 7;
to point 8;
to point 9;
to point 10;
to point 11;
to point 12;
to point 13;
to point 14;
to point 15;
to point 16;
to point 17;
to point 18;
to point 19;
to point 20;
to point 21;
to point 22;
to point 23;
to point 24;
to point 25;
to point 26;
to point 27;
to point 28;
to point 29;
to point 30;
to point 31;
to point 32;
to point 33;
to point 34;
to point 35;

Laws on Bases Conversion

BATAAN BUSINESS AND LEISURE PARK - Proclamation No. 984

thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

N.
N.
N.
N.
S.
N.
N.
N.
N.
S.
N.
N.
N.
S.
N.
S.
S.
S.
S.
S.
S.
S.
N.
N.
N.
N.
S.
N.
N.
N.
S.
S.
N.
S.
N.
S.
S.
S.
N.
N.
N.
N.
S.
S.
S.

Laws on Bases Conversion

7
8
53
44
84
50
33
82
67
50
62
53
45
40
69
74
39
26
73
57
25
56
75
37
11
68
6
60
20
18
72
55
53
74
37
21
25
50
78
29
35
87
17
73
68

deg. 10
deg. 51
deg. 38
deg. 0
deg. 55
deg. 57
deg. 32
deg. 46
deg. 51
deg. 0
deg. 1
deg. 30
deg. 36
deg. 45
deg. 32
deg. 10
deg. 44
deg. 37
deg. 7
deg. 47
deg. 27
deg. 35
deg. 53
deg. 47
deg. 39
deg. 25
deg. 25
deg. 3
deg. 34
deg. 55
deg. 59
deg. 24
deg. 30
deg. 7
deg. 28
deg. 28
deg. 17
deg. 19
deg. 58
deg. 42
deg. 47
deg. 35
deg. 27
deg. 16
deg. 0

E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
W.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
W.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,

48.67
36.39
66.29
29.12
43.34
14.87
26.63
21.21
63.42
18.36
15.26
1.53
61.85
40.20
49.15
48.28
48.70
20.07
33.19
45.03
47.46
19.52
9.19
27.93
9.66
26.18
46.38
39.39
31.88
64.43
38.03
18.79
48.93
44.11
63.14
39.37
12.06
9.96
57.67
20.64
11.03
11.39
17.64
6.08
94.60

m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.
m.

to point 36;
to point 37;
to point 38;
to point 39;
to point 40;
to point 41;
to point 42;
to point 43;
to point 44;
to point 44;
to point 46;
to point 47;
to point 48;
to point 49;
to point 50;
to point 51;
to point 52;
to point 53;
to point 54;
to point 55;
to point 56;
to point 57;
to point 58;
to point 59;
to point 60;
to point 61;
to point 62;
to point 63;
to point 64;
to point 65;
to point 66;
to point 67;
to point 68;
to point 69;
to point 70;
to point 71;
to point 72;
to point 73;
to point 74;
to point 75;
to point 76;
to point 77;
to point 78;
to point 79;
to point 80;

166

BATAAN BUSINESS AND LEISURE PARK - Proclamation No. 984

thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

167

N.
S.
S.
S.
S.
N.
N.
N.
N.
N.
N.
N.
S.
S.
S.
S.
S.
S.
S.
S.
N.
S.
S.
S.
S.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
S.
S.
N.
S.
N.
N.
S.
N.
S.

59
85
32
19
17
82
45
8
82
74
75
17
88
62
28
25
27
43
26
54
73
18
22
41
78
59
20
3
32
26
37
60
32
82
16
67
28
49
76
44
25
44
38
71
4

deg. 40
deg. 52
deg. 2
deg. 15
deg. 17
deg. 45
deg. 27
deg. 3
deg. 37
deg. 9
deg. 7
deg. 32
deg. 28
deg. 40
deg. 15
deg. 17
deg. 49
deg. 50
deg. 2
deg. 7
deg. 4
deg. 3
deg. 23
deg. 12
deg. 34
deg. 30
deg. 42
deg. 42
deg. 19
deg. 40
deg. 25
deg. 47
deg. 16
deg. 19
deg. 27
deg. 58
deg. 42
deg. 27
deg. 49
deg. 45
deg. 43
deg. 0
deg. 48
deg. 44
deg. 41

E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
W.,
W.,
W.,
E.,
E.,
E.,
E.,
W.,
E.,
E.,
E.,
E.,
W.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
W.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,

30.99 m.
3.47 m.
36.00 m.
33.26 m.
22.39 m.
28.02 m.
20.77 m.
10.79 m.
11.36 m.
6.19 m.
13.59 m.
25.20 m.
23.95 m.
5.31 m.
5.49 m.
5.76 m.
21.02 m.
24.61 m.
15.22 m.
25.70 m.
41.93 m.
21.47 m.
28.16 m.
30.12 m.
21.24 m.
28.13 m.
41.74 m.
27.07 m.
19.48 m.
16.45 m.
12.87 m.
22.98 m.
20.60 m.
35.60 m.
39.99 m.
35.60 m.
25.63 m.
20.20 m.
12.31 m.
37.66 m.
41.53 m.
34.21 m.
41.17 m.
105.72 m.
23.52 m.

to point 81;
to point 82;
to point 83;
to point 84;
to point 85;
to point 86;
to point 87;
to point 88;
to point 89;
to point 90;
to point 91;
to point 92;
to point 93;
to point 94;
to point 95;
to point 96;
to point 97;
to point 98;
to point 99;
to point 100;
to point 101;
to point 102;
to point 103;
to point 104;
to point 105;
to point 106;
to point 107;
to point 108;
to point 109;
to point 110;
to point 111;
to point 112;
to point 113;
to point 114;
to point 115;
to point 116;
to point 117;
to point 118;
to point 119;
to point 120;
to point 121;
to point 122;
to point 123;
to point 124;
to point 125;

Laws on Bases Conversion

BATAAN BUSINESS AND LEISURE PARK - Proclamation No. 984

thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

S.
S.
S.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
N.
S.
S.
N.
N.
N.
N.
N.
S.
S.
S.
N.
N.
N.
N.
S.

Laws on Bases Conversion

10
66
52
33
37
52
12
78
14
87
20
41
0
42
80
80
15
75
68
50
33
6
60
63
67
7
23
21
43
56
53
80
67
48
33
37
43
85
21
80
7
4
89
81
80

deg. 24
deg. 12
deg. 32
deg. 31
deg. 34
deg. 44
deg. 42
deg. 40
deg. 53
deg. 7
deg. 4
deg. 40
deg. 56
deg. 48
deg. 44
deg. 13
deg. 14
deg. 5
deg. 38
deg. 43
deg. 7
deg. 22
deg. 47
deg. 45
deg. 33
deg. 12
deg. 54
deg. 26
deg. 5
deg. 10
deg. 31
deg. 10
deg. 56
deg. 9
deg. 36
deg. 9
deg. 34
deg. 29
deg. 13
deg. 16
deg. 15
deg. 45
deg. 18
deg. 50
deg. 20

E.,
E.,
E.,
E.,
E.,
W.,
W.,
E.,
E.,
E.,
E.,
E.,
W.,
E.,
E.,
E.,
E.,
W.,
W.,
W.,
E.,
W.,
W.,
W.,
E.,
W.,
W.,
E.,
W.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,
E.,

13.25 m.
50.95 m.
29.66 m.
19.18 m.
10.50 m.
30.81 m.
121.48 m.
87.58 m.
32.38 m.
38.47 m.
23.11 m.
27.32 m.
45.66 m.
115.42 m.
37.94 m.
39.90 m.
63.43 m.
30.07 m.
35.99 m.
30.49 m.
57.76 m.
31.19 m.
49.59 m.
40.73 m.
44.13 m.
22.20 m.
44.07 m.
10.59 m.
21.73 m.
15.66 m.
30.41 m.
36.70 m.
25.35 m.
22.94 m.
18.06 m.
45.90 m.
24.54 m.
16.26 m.
29.65 m.
21.93 m.
38.87 m.
20.56 m.
79.80 m.
287.58 m.
218.25 m.

to point 126;
to point 127;
to point 128;
to point 129;
to point 130;
to point 131;
to point 132;
to point 133;
to point 134;
to point 135;
to point 136;
to point 137;
to point 138;
to point 139;
to point 140;
to point 141;
to point 142;
to point 143;
to point 144;
to point 145;
to point 146;
to point 147;
to point 148;
to point 149;
to point 150;
to point 151;
to point 152;
to point 153;
to point 154;
to point 155;
to point 156;
to point 157;
to point 158;
to point 159;
to point 160;
to point 161;
to point 162;
to point 163;
to point 164;
to point 165;
to point 166;
to point 167;
to point 168;
to point 169;
to point 170;

168

BATAAN BUSINESS AND LEISURE PARK - Proclamation No. 984

thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

169

S.
S.
S.
N.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
N.
N.
N.
S.
S.
S.
N.
N.
N.
S.
S.
S.
S.
N.
S.
N.
S.
S.
S.
S.
S.
S.
S.
S.
S.

47
3
24
73
35
18
24
27
32
19
8
17
6
9
25
10
16
36
58
66
75
86
89
59
71
89
79
72
70
64
70
77
70
3
82
88
75
86
48
63
6
80
60
27
51

deg. 35
deg. 12
deg. 3
deg. 36
deg. 27
deg. 9
deg. 33
deg. 2
deg. 56
deg. 28
deg. 17
deg. 19
deg. 56
deg. 28
deg. 19
deg. 0
deg. 0
deg. 12
deg. 31
deg. 46
deg. 34
deg. 40
deg. 12
deg. 57
deg. 55
deg. 47
deg. 41
deg. 26
deg. 47
deg. 58
deg. 40
deg. 57
deg. 45
deg. 30
deg. 17
deg. 7
deg. 0
deg. 3
deg. 8
deg. 55
deg. 54
deg. 43
deg. 1
deg. 11
deg. 49

E.,
W.,
E.,
E.,
E.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
E.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,

185.07 m.
172.07 m.
194.30 m.
142.33 m.
20.23 m.
75.49 m.
63.33 m.
50.36 m.
25.79 m.
55.73 m.
30.26 m.
30.57 m.
91.63 m.
19.09 m.
40.12 m.
16.40 m.
22.14 m.
11.75 m.
7.66 m.
98.14 m.
147.48 m.
51.23 m.
23.56 m.
33.19 m.
226.75 m.
31.13 m.
31.15 m.
53.76 m.
135.00 m.
175.84 m.
95.87 m.
74.97 m.
107.95 m.
47.08 m.
92.58 m.
197.42 m.
91.91 m.
52.43 m.
21.24 m.
22.45 m.
27.04 m.
54.03 m.
23.81 m.
39.83 m.
412.99 m.

to point 171;
to point 172;
to point 173;
to point 174;
to point 175;
to point 176;
to point 177;
to point 178;
to point 179;
to point 180;
to point 181;
to point 182;
to point 183;
to point 184;
to point 185;
to point 186;
to point 187;
to point 188;
to point 189;
to point 190;
to point 191;
to point 192;
to point 193;
to point 194;
to point 195;
to point 196;
to point 197;
to point 198;
to point 199;
to point 200;
to point 201;
to point 202;
to point 203;
to point 204;
to point 205;
to point 206;
to point 207;
to point 208;
to point 209;
to point 210;
to point 211;
to point 212;
to point 213;
to point 214;
to point 215;

Laws on Bases Conversion

BATAAN BUSINESS AND LEISURE PARK - Proclamation No. 984

thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence
thence

S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
S.
N.
S.
S.
S.
S.
S.
S.
N.
N.
N.

64
52
1
33
38
8
23
22
41
76
47
34
63
72
74
79
70
78
39
28
30

deg. 16
deg. 10
deg. 36
deg. 0
deg. 43
deg. 9
deg. 45
deg. 13
deg. 30
deg. 15
deg. 32
deg. 14
deg. 19
deg. 49
deg. 42
deg. 36
deg. 11
deg. 7
deg. 3
deg. 24
deg. 32

E.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
W.,
E.,
W.,

40.42 m.
143.99 m.
210.27 m.
156.50 m.
97.62 m.
59.69 m.
100.98 m.
79.78 m.
95.21 m.
125.54 m.
136.50 m.
157.29 m.
334.82 m.
108.32 m.
45.81 m.
116.57 m.
118.61 m.
337.33 m.
187.51 m.
65.88 m.
45.96 m.

to point 216;
to point 217;
to point 218;
to point 219;
to point 220;
to point 221;
to point 222;
to point 223;
to point 224;
to point 225;
to point 226;
to point 227;
to point 228;
to point 229;
to point 230;
to point 231;
to point 232;
to point 233;
to point 234;
to point 235;
to point of;

beginning, containing an area of THREE MILLION SIX HUNDRED FIFTY TWO


THOUSAND THREE HUNDRED FIFTEEN (3,652,315) SQUARE METRES more or less.
All points referred to are indicated on the plan and are marked on the ground by PS
cyl. conc. mons. 15x40cm and hub; bearings true.
Section 3. Main ZoneThe area delineated under Sec. 2 and transferred to BCDA is
hereby designated as the Main Zone. For this purpose, applicable incentives under
Sec. 6 hereof shall in the interim be limited to the Main Zone.
Section 4. Governing Body of the Morong Special Economic Zone. Pursuant to
Memorandum Order No. 267 dated 07 March 1995, as amended by Memorandum
Order No. 280 dated 28 April 1995, BCDA is hereby established as the governing
body of the MSEZ and shall take over from the Ad hoc Committee for the Conversion
of the PRPC Complex the preservation, maintenance, security, and development of the
PRPCC. BCDA shall determine the utilization of the lands subject to private property
rights and consistent with existing laws.
Pursuant to Section 5(m) of R.A. 7227, BCDA shall, in consultation with local government
units concerned, promulgate the necessary policies, rules and regulations to govern
and regulate the MSEZ including investment incentives, through an operating and
implementing arm it may establish or through another entity/entities or joint venture
with whom it may enter into contract for its economic development and optimum
utilization
Laws on Bases Conversion

170

BATAAN BUSINESS AND LEISURE PARK - Proclamation No. 984

Section 5. Parameters for Conversion. The MSEZ shall have the following parameters
to guide its conversion/development:
1.1 Economic. The MSEZ shall be self-sustaining and self-liquidating as far as
practicable, and consistent with the Bataan, the Subic Bay and the Central
Luzon Development Programs, in line with the Vision of Philippines 2000.
1.2 Social. The MSEZ shall promote and prioritize the utilization of indigenous
resources, the growth of satellite industries in the locality, the forward and
backward linkages of industries in and out of the PRPCC, and the upgrading of
workers' skills to benefit local people whenever viable/practicable.
1.3 Environmental. The MSEZ shall ensure sustainable development of the area
through establishment of environmental-friendly industries and an eco-tourism
component, as well as the institutionalization of appropriate measures to
conserve the environment.
1.4 Technological. The MSEZ shall serve as the springboard of the country
to the 21st country by focusing and promoting knowledge-based and high
technology industries. It shall also promote economic growth through the
commercialization of high quality research and development and high-value
added products and services.
1.5 Infrastructure Support. The MSEZ shall have the required infrastructure linkages
with growth centers and growth areas in the locality to allow integration of
development efforts in the region.
Section 6. Investment Climate in Morong Special Economic Zone. MSEZ, among
others, shall have all the applicable incentives granted in the Subic Special Economic
Zone under RA 7227, except freeport status, and those applicable incentives granted
under the Omnibus Investment Code of 1987 as amended and the Foreign Investment
Act of 1991, as amended. For this purpose, BCDA shall issue the pertinent implementing
guidelines, and upon the concurrence of the local government unit of Morong, the
same investment incentives applied to the main zone shall also be applied to the subzone subject to existing laws.
Section 7. Implementing Rules and Regulations. Pursuant to Section 5 (m) of RA
7227 (Defining the Powers of the BCDA), the BCDA shall prepare the Implementing
Rules and Regulations for the Morong SEZ within 60 days after the issuance of this
Proclamation.
Section 8. Role of Departments, Bureaus, Offices Agencies and Instrumentalities.
To facilitate the necessary approvals and to expedite government bureaus, offices,
agencies and instrumentalities are hereby directed to give full support to BCDA and/
or its implementing subsidiary or joint venture corporation.
Section 9. Local Autonomy. The Municipality of Morong and the Province of Bataan
shall retain its basic autonomy and identity except on matters affecting business and

171

Laws on Bases Conversion

BATAAN BUSINESS AND LEISURE PARK - Proclamation No. 984

investment policies, tax incentives and exemptions, planning, zoning and land use in
the Main Zone, where the decision of BCDA shall prevail.
Section 10. Repealing Clause. All orders, rules and regulations or parts thereof,
which are inconsistent with the provisions of this Proclamation, are hereby repealed,
amended or modified accordingly.
Section 11. Separability Clause. If any provision of this proclamation shall be held
unconstitutional or invalid, the other provisions not otherwise affected shall remain
valid and in full force and effect.
Section 12. Effectivity. This Proclamation shall take effect immediately.
Done in the City of Manila, this 26th day of March, in the year of Our Lord, nineteen
hundred and ninety-seven.

(Sgd.) FIDEL V. RAMOS


President of the Philippines
By the President:

(Sgd.) RUBEN D. TORRES


Executive Secretary

Laws on Bases Conversion

172

BATAAN BUSINESS AND LEISURE PARK - Executive Order No. 381

Executive Order No. 381


Placing the Bataan Technology Park Under
of the Subic Bay Metropolitan Authority

the Jurisdiction

I, GLORIA MACAPAGAL-ARROYO, President of the Republic of the Philippines,by


virtue of the powers vested in me by law, do hereby order:
Section 1. Jurisdiction. The Bataan Technology Park (BTP) is hereby placed under the
jurisdiction of the Subic Bay Metropolitan Authority (SBMA). All territories comprising
the BTP shall henceforth be known as SBMA-Bataan:
Section 2. Economic Zone and Freeport. SBMA-Bataan shall follow all the rules of
SBMA as an Economic Zone and Freeport.
Section 3. Regulatory Powers, Functions and Authority. The regulatory powers,
functions and authority over BTP, henceforth known as SBMA-Bataan, are hereby
transferred from the Bases Conversion Development Authority to the SBMA
Section 4. Management Structure. BTP, henceforth known as SBMA-Bataan, shall
continue to be managed in accordance with the charter of Bataan Technology park,
Incorporated. Its Chairman, Board, and President/Chief Executive Officer shall be
appointed by the President of the Philippines. The Board is empowered to reorganize
the management staff of SBMA-Bataan.
Section 5. Repealing Clause. All executive issuances, orders, rules and regulations, or
any part thereof, which are inconsistent with any provision of this Executive Order are
hereby revoked, amended or modified accordingly.
Section 6. Effectivity. This Executive Order shall take effect immediately.
DONE in the City of Manila, this 26th day of October, in the year of our Lord, two
thousand and four.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:
(Sgd.) EDUARDO R. ERMITA
Executive Secretary

173

Laws on Bases Conversion

BATAAN TECHNOLOGY PARK - Executive Order No. 476

Executive Order No. 476


Placing the Bataan Technology Park, Inc. Back Under
of the Bases Conversion and Development Authority

the Jurisdiction

WHEREAS, the Bases Conversion and Development Authority (BCDA) was created
under Republic Act (RA) No. 7227, and Section 16 thereof allows it to form, establish,
organize and maintain a subsidiary corporation or corporations;
WHEREAS, Executive Order (EO) No. 62, dated February 27, 1993, prescribing
policies and guidelines to implement RA 7227, in Section 3 thereof, authorizes BCDA
to adopt and implement an effective oversight mechanism over subsidiaries, attached
authorities and special economic zones declared under the Act;
WHEREAS, Section 3 of EO 381, dated October 26, 2004, placing the Bataan
Technology Park (BTP) under the jurisdiction of the Subic Bay Metropolitan Authority
(SBMA), transferred the regulatory powers, functions and authority of BCDA over BTP
to SBMA;
WHEREAS, Section 20, Chapter 7, Title I, Book III of the Administrative Code of 1987
grants the President residual powers to reorganize the Executive Branch of government.
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the
Republic of the Philippines, by virtue of the powers vested in me by law, do hereby
place the Bataan Technology Park, Incorporated back under the jurisdiction of the
Bases Conversion and Development Authority (BCDA). All orders, issuances, rules
and regulations or parts thereof inconsistent with this Executive Order are hereby
repealed and modified accordingly.
This Executive Order shall take effect immediately upon publication in a newspaper
of general circulation.
Done in the City of Manila, this 6th day of December in the year of Our Lord, Two
Thousand and Five.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:
(Sgd.) EDUARDO R. ERMITA
Executive Secretary
Laws on Bases Conversion

174

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 504

Executive Order No. 504


Creating a Subic-Clark Area Development Council Repealing Executive
Order No. 365 (S. 2004) and Executive Order No. 478 (S.2005)
and for Other Purposes
WHEREAS, the Subic Bay Metropolitan Authority (SBMA) was created by law as the
authority over the Subic Special Economic Zone (SSEZ) and the Clark Development
Corporation (CDC) was created as an operating and implementing arm of the Bases
Conversion and Development Authority over the Clark Special Economic Zone (CSEZ);
WHEREAS, on 21 June 2001, the BCDA, SBMA, CDC and the Department of Trade
and Industry (DTI) entered into a Memorandum of Understanding and created the
Subic-Clark Alliance Development (SCAD) Task Force, which shall be their policymaking body in their integrated development program with the SSEZ and CSEZ and
the corridor between them, to be known as the Subic-Clark Alliance Development
Program;
WHEREAS, on June 30, 2004, the President declared as one of the ten-point legacy
agenda of the Arroyo administration that the Subic-Clark corridor shall be the most
competitive international service and logistics center in the region;
WHEREAS, Executive Order No. 365 (s.2004) defined the functions of the Adviser for
Subic-Clark Area Development;
WHEREAS, Executive Order No. 478 (s. 2005) placed the BCDA and its subsidiaries
and attached agencies under the policy supervision of the Department of Trade and
Industry;
WHEREAS, the development of the Subic-Clark corridor involves several senior
officials from different departments and agencies, with no one clearly in charge on a
full time basis;
WHEREAS, there is a need for a single body with a full-time head to rationalize resources
and harmonize strategies that will ensure an integrated and coordinated approach to the
development of the Subic-Clark;
NOW, THEREFORE, I, GLORIA MACAPAGALARROYO, President of the Republic of
the Philippines, by virtue of powers vested in me by the law and the Constitution, do
hereby order:
SECTION 1. CREATION OF A SUBIC-CLARK AREA DEVELOPMENT COUNCIL.
The SCAD TASK Force is hereby transformed into a Subic-Clark Area Development
Council (SCAD Council).

175

Laws on Bases Conversion

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 504

SECTION 2. POWERS AND FUNCTIONS OF THE SCAD COUNCIL.The SCAD


Council shall perform the functions of the erstwhile SCAD Task Force.
SECTION 3. COMPOSITION.The SCAD Council shall be composed of the following:

a. Chairman, to be appointed by the President, with Cabinet rank, and who shall
be a member of the National Economic Development Authority (NEDA);

b. Director-General, NEDA Member;

c. Secretary of Trade and Industry Member;

d. Chairman, BCDA Member;

e. Chairman, SBMA Member;

f. Chairman, CDC Member;

g. President, BCDA Member;

h. Administrator, SBMA Member;

i. President, CDC Member;

j. Presidential Assistant for Central Luzon Member.

The members shall elect among themselves the Vice-Chairman.


SECTION 4. FUNDING.The Department of Budget and Management shall
recommend the amount and source of the initial funding for the SCAD Council.
SECTION 5. POLICY OVERSIGHT OVER BCDA.Policy oversight over the BCDA and
its subsidiaries other than the CDC shall be exercised by the Secretary of Trade and
Industry.
SECTION 6. REPEALING CLAUSE.Executive Order No. 365 (s.2004) and Executive
Order No. 478 (s.2005) are hereby repealed. All other executive issuances, orders,
rules and regulations or parts thereof inconsistent with the provisions of this Executive
Order are hereby repealed or modified accordingly.

Laws on Bases Conversion

176

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 504

SECTION 7. EFFECTIVITY.This Executive Order shall take effect immediately.


DONE in the City of Manila, this 1st day of February in the Year of Our Lord, Two
Thousand and Six.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

177

Laws on Bases Conversion

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 504-A

Executive Order No. 504-A


Defining the Powers and Functions of the Subic Clark Alliance
for Development Council (SCAD COUNCIL), Amending
Executive Order No. 504 (S. 2006), and for Other Purposes
WHEREAS, The Subic Bay Metropolitan Authority (SBMA) was created by law as
the authority over the Subic Bay Freeport Zone (SBFZ), and the Clark Development
Corporation (CDC) was created as an operating and implementing arm of the Bases
Conversion Development Authority (BCDA) over the Clark Special Economic Zone
(CSEZ);
WHEREAS, on 21 June 2001, the BCDA, SBMA, CDC and the Department of Trade
and Industry (DTI) entered into a Memorandum of Understanding (MOU) creating
the Subic-Clark Alliance Development (SCAD) Task Force, their policy-making body
in their integrated development program with the SSEZ and CSEZ and the corridor
between them, to be known as the Subic-Clark Alliance Development Program;
WHEREAS, on 30 June 2004, the President declared as one of the ten-point legacy
agenda of the Arroyo administration that the Subic-Clark corridor shall be the most
competitive international service and logistics center in the region;
WHEREAS, Executive Order No. 365 (S. 2004) created the Office of the Presidential
Adviser on Subic-Clark Area Development and defined its functions;
WHEREAS, Executive Order No. 478 (S. 2005) placed the BCDA and its subsidiaries
and attached agencies under the policy supervision of the Department of Trade and
Industry, amending Executive Order No. 365 (S. 2004);
WHEREAS, Executive Order No. 504 (s. 2006) created the Subic-Clark Area
Development Council, repealing Executive Order Nos. 365 (S. 2004) and 478 (S.
2005);
WHEREAS, Administrative Order No. 150 (s. 2006) renamed the Subic-Clark Area
Development Council to Subic-Clark Alliance for Development Council;
WHEREAS, Executive Order No. 516 reverted the supervision of BCDA from the
Department of Trade and Industry to the Office of the President, amending Executive
Order 504 section 5 (S. 2005);
WHEREAS, Executive Order No. 561, series of 2007, authorized the formation of the
Super Regions and mandated the creation of, among others, the Luzon Urban Beltway
composed of most of Central Luzon, National Capital Region (NCR), Calabarzon,
Mindoro, and Marinduque;

Laws on Bases Conversion

178

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 504-A

WHEREAS, there is a need to strengthen and enhance the powers and capabilities of
the SCAD Council as the single body with a full-time head to rationalize resources and
harmonize strategies that will ensure an integrated and coordinated approach to the
development of the SCAD corridor as a world-class mega-logistics hub and a global
gateway to the Asia Pacific Region;
WHEREAS, there is a need to clearly define and state the powers and functions of the
SCAD Council and the Office of the Chairman in order to effectively deal directly with
the concerned agencies under its supervision, namely: Bases Conversion Development
Authority (BCDA), Subic Bay Metropolitan Authority (SBMA), Clark Development
Corporation (CDC) and Clark International Airport Corporation (CIAC);
NOW, THEREFORE, I, GLORIA MACAPAGALARROYO, President of the Republic
of the Philippines, by virtue of the powers vested in me by law and the Constitution,
do hereby order:
SECTION 1. Powers and Functions of the SCAD Council.The SCAD Council shall
perform the following functions:
a. Formulate policies and programs to develop Subic, Clark, and the corridor in
between them as globally competitive Mega Logistics Hub;
b. Review, identify and recommend priority infrastructure projects for
implementation;
c. Formulate common investment promotions activities;
d. Harmonize in the SBFZ and CFZ such programs, policies, rules and regulations
affecting investments, incentives, customs, immigration, leasing, privatization,
and other matters necessarily related thereto;
e. Perform such other functions as may be authorized.
SECTION 2. Composition.The SCAD Council shall be composed of the following:
a. Chairman, to be appointed by the President, with Cabinet rank, and who shall
be a member of the National Economic and Development Authority (NEDA);
b. Secretary of Trade and Industry - Vice Chairman;
c. Chairman, BCDA Member;
d. Chairman, SBMA - Member;
e. Chairman, CDC - Member;

179

Laws on Bases Conversion

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 504-A

f. Chairman, CIAC - Member;


g. President, BCDA - Member;
h. Administrator, SBMA - Member;
i. President, CDC - Member;
j. President, CIAC - Member;
SECTION 3. Powers and Functions of the SCAD Council Chairman.The SCAD
Chairman shall be a full-time head of the Council to rationalize resources and
harmonize strategies that will ensure an integrated and coordinated approach to the
development of the Subic-Clark corridor and achieve its objectives. The office of the
SCAD Council Chairman shall have the following duties and functions:
a. To act as the Chief Executive Officer of the SCAD Council;
b. To obtain the participation of strategic partners, domestic or foreign, from the
public or private sector, to spur the growth and development of Central Luzon;
c. To obtain the required participation, support and assistance of all relevant
government agencies and entities as well as concerned local government units
in the formulation of the development as well as the implementation of the key
components of the said program;
d. To represent the Office of the President in dealings with offices, agencies and
instrumentalities of the Government and with persons and entities, public
or private, domestic or foreign, insofar as contributory to the development
of Subic, Clark and the corridor in between them as a globally competitive
international service and logistics center; and;
e. To exercise such other powers, functions and duties as may be directed by the
President insofar as the development of the Subic-Clark hub is concerned.
SECTION 4. Policy Oversight.The Office of the President, through the SCAD Council
Chairman, with Cabinet rank, shall exercise policy oversight over the Bases Conversion
Development Authority (BCDA), Subic Bay Metropolitan Authority (SBMA), Clark
Development Corporation (CDC), Clark International Airport Corporation (CIAC) in
so far as the development of Clark, Subic and the Corridor between then into a major
logistics hub in concerned.
SECTION 5. SCAD Council Staff.The SCAD Council Chairman shall have staff
support to carry out his functions.

Laws on Bases Conversion

180

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 504-A

SECTION 6. Role of Local Government Units, Departments, Bureaus, Offices, Agencies,


and Instrumentalities.All heads of Local Government Units within the coverage of
SCAD Corridor, departments, bureaus, offices, agencies, and instrumentalities of the
government are hereby directed to give full support to the SCAD Council to expedite
the implementation of the various programs and projects towards the attainment of the
SCAD vision.
SECTION 7. Funding.The 3 agencies (SBMA, BCDA, and CDC) shall allocate from
their respective yearly budgets an amount approved by the Department of Budget and
Management for the SCADC Budget as their contributions. This fund shall be released
every first week of January of the year to which it corresponds.Council shall have
the authority to generate its own revenues or funds and to disburse its own funds in
accordance with government accounting rules and procedures.
SECTION 8. Repealing Clause.All other executive issuances, orders, rules and
regulations or parts thereof inconsistent with the provisions of this Executive Order are
hereby repealed or modified accordingly.
SECTION 9. Effectivity.This Executive Order shall take effect immediately.
DONE in the City of Manila, this 10th day of April, in the year of Our Lord, Two
Thousand and Eight.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) IGNACIO R. BUNYE


Acting Executive Secretary

181

Laws on Bases Conversion

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 733

Executive Order No. 733


Reorganizing the Subic-Clark Alliance for Development Council (SCAD COUNCIL)
WHEREAS, Executive Order No. (EO) 504 dated 10 April 2008 defined the powers
and functions of the Subic-Clark Alliance for Development Council (SCAD Council);
a. WHEREAS, EO 504 composed the SCAD Council as follows:
b. Chairman, to be appointed by the President, with Cabinet rank, and who shall
be a member of the National Economic and Development Authority;
c. Secretary of Trade and Industry - Vice Chairman;
d. Chairman, Bases Conversion Development Authority (BCDA) - Member;
e. Chairman, Subic Bay Metropolitan Authority (SBMA) - Member;
f. Chairman, Clark Development Corporation (CDC) - Member;
g. Chairman, Clark International Airport Corporation (CIAC) - Member;
h. President, BCDA - Member;
i. Administrator, SBMA - Member;
j. President, CDC - Member;
k. President, CIAC - Member;
WHEREAS, EO 504 mandated the Chairman of the SCAD Council to act as the Chief
Executive Officer of the Council;
WHEREAS, Northrail is an essential component of the vision to make the Subic-Clark
corridor the best service and logistics center in the region;
NOW, THEREFORE, I, GLORIA M. ARROYO, President of the Republic of the
Philippines, by virtue of the powers vested in me by law and the Constitution, do
hereby order:
SECTION 1. Northrail.The Chairman of Northrail, who shall be appointed by the
President and shall serve as Chief Executive Officer, and the President of Northrail,
who shall likewise be appointed by the President and shall serve as Chief Operating
Officer, shall be members of the SCAD Council.

Laws on Bases Conversion

182

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 733

SECTION 2. Chairman.The President shall appoint the Chairman of the SCAD


Council from among the members. The Chairman shall lead the Council in harmonizing
strategies that will ensure an integrated and coordinated approach to the development
of the Clark-Subic Corridor and achieve its objectives. He shall exercise his leadership
through the following activities:
a. Assist the agencies who compose the Council obtain the participation of
strategic partners to spur the growth and development of the Clark-Subic Hub
b. Obtain the participation, support and assistance of relevant government
agencies and entities as well as concerned local government units in the
formulation of the development program as well as the implementation of
such key components as expected of them;
c. Exercise policy oversight over the agencies who compose the Council;
d. Exercise such other powers, functions and duties as may be directed by the
President insofar as the development of the Clark-Subic hub is concerned.
SECTION 3. Role of Local Government Units, Departments, Bureaus, Offices, Agencies
and Instrumentalities.All heads of local government units within the coverage of the
SCAD corridor, departments, bureaus, offices, agencies and instrumentalities of the
government are hereby directed to give full support to the SCAD Council to expedite
the implementation of the various programs and projects towards the attainment of the
SCAD vision.
SECTION 4. Funding.The five (5) agencies (SBMA, BCDA, CDC, CIAC and
Northrail) shall allocate from their respective yearly budgets an amount approved by
the Department of Budget and Management for the SCAD Council Secretariat budget
as their contributions. The fund shall be released every first week of January of the year
to which it corresponds.
SECTION 5. Repealing Clause.All other executive issuances, orders, rules and
regulations or parts thereof inconsistent with the provisions of this Executive Order are
hereby repealed or modified accordingly.

183

Laws on Bases Conversion

SUBIC-CLARK ALLIANCE DEVELOPMENT COUNCIL - Executive Order No. 733

SECTION 6. Effectivity.This Executive Order shall take effect immediately.


DONE in the City of Manila, this 16th day of June in the year of Our Lord, Two
Thousand and Eight.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

Laws on Bases Conversion

184

NORTHRAIL PROJECT - Executive Order No. 176

Executive Order No. 176


Placing the Philippine National Railways (PNR), Light Rail Transit Authority (LRTA)
and All Other Railway and Mass Transit Projects Under the Overall Supervision of
the Department of Transportation and Communications
WHEREAS, the Government recognizes the importance of modern and efficient rail
systems for providing fast and reliable means of urban and long distance transportation;
WHEREAS, there is a need to improve the financial viability and demonstrate efficient
performance in the areas of railway systems management, operations, maintenance,
upgrading and expansion of services;
WHEREAS, various studies have advocated the need for institutional and organizational
restructuring of the rail sector and the consolidation of rail regulatory authority under
a defined structure;
WHEREAS, pursuant to Executive Order No. 125 dated 30 January 1987 (Reorganizing
the Ministry of Transportation and Communications) the Department of Transportation
and Communications (DOTC) shall be the primary policy, planning, programming,
coordinating, implementing, regulating and administrative entity of the government in
the promotion, development and regulation of dependable and coordinated networks
of transportation and communications systems;
WHEREAS, under Section 77 of the General Provisions of Republic Act No. 8745 or FY
1999 General Appropriations Act, the President may direct changes in the organization
and key positions in any department, bureau or agency;
NOW, THEREFORE, I, JOSEPH EJERCITO ESTRADA, President of the Republic
of the Philippines, by virtue of the powers vested in me by law, do hereby order the
following:
Section 1. Policy on Rail Sector Modernization and Development.It shall be
the policy of the government to pursue an accelerated program for the upgrading,
modernization and development of rail transportation services to provide a convenient,
efficient and affordable means of mass transport for both urban as well as long distance
passenger and freight applications.
Such a program shall be undertaken with maximum private sector participation and
public-private partnership schemes, and should seek to achieve the integration of
heavy rail systems with the existing and planned light rail systems. The rail systems
should connect to other transport systems at intermodal stations, as well as seaports
and airports.

185

Laws on Bases Conversion

NORTHRAIL PROJECT - Executive Order No. 176

Section 2. Role of DOTC.The DOTC, as the main transport planning and regulatory
agency of the government, shall take primary responsibility to prepare plans, secure
legislation and implement measures to carry out the restructuring of the rail sector and
to encourage and maximize private sector initiatives and participation.
In support of this role, the DOTC shall have overall supervision over PNR, LRTA and the
planning, coordination, and implementation of all rail-based transportation systems,
programs and projects.
The DOTC shall report to the President any development which could hamper the
governments program for the upgrading, modernization and development of rail
transportation services.
Since it is essential to railway development to clear rail rights-of-way of obstructions
and encroachments, the DOTC is also given authority and overall supervision over
the relocation of informal dwellers by PNR and LRTA from their rail rights-of-way,
in close coordination with the Presidential Commission on Mass Housing and local
government units.
All activities towards these ends shall be under the responsibility and supervision of
the Secretary of DOTC through the Undersecretary for Railways. For this purpose, the
Undersecretary for Railways shall be provided with the necessary administrative and
technical support.
Section 3. Technical Support and Coordinating Mechanism.All government
departments, agencies, GOCCs and local government units which are involved in
rail-related projects are directed to coordinate their rail-related activities with the
DOTC and to provide all the support and cooperation which it might require in the
performance of its responsibilities.
Section 4. Repealing Clause.All issuances, orders, rules and regulations or parts
thereof which are inconsistent with the provisions of this Executive Order are hereby
repealed or modified accordingly.
Section 5. Effectivity.This Executive Order takes effect immediately.
DONE, in the City of Manila, this 11th day of November, in the Year of Our Lord,
Nineteen Hundred and Ninety-Nine.







By the President:

(Sgd.) JOSEPH EJERCITO ESTRADA


President of the Philippines
Laws on Bases Conversion

(Sgd.) RONALDO B. ZAMORA


Executive Secretary

186

NORTHRAIL PROJECT - Executive Order No. 232

Executive Order No. 232


Directing the Secretary of the Department of Transportation and
Communications (DOTC) to Exercise Primary Oversight Functions Over
the North Rail Project, Transferring the North Luzon Railways
Corporation (NORTHRAIL) from the Office of the President to the DOTC,
and Reorganizing the Respective Governing Boards of NORTHRAIL
and the Philippine National Railways (PNR)
WHEREAS, the North Rail Project was established to provide a mass transport railway
system that would interconnect the former baselands from Metro Manila (Fort Bonifacio)
to Central ((Mark and Subic) and Northern Luzon (Poro Point);
WHEREAS, NORTHRAIL was incorporated and registered with the Securities and
Exchange Commission as a wholly-owned subsidiary of the Bases Conversion
Development Authority (BCDA) with the primary purpose to develop, construct,
operate and manage a railroad system to serve Metro Manila, Central and Northern
Luzon;
WHEREAS, to ensure the accomplishment of the objective of the North Rail Project,
there is a need to establish clear lines of authority and accountability by directing a
specific cabinet official to exercise '"primary oversight functions over the same;
WHEREAS, the DOTC is the primary policy, planning, programming, coordinating,
implementing, regulating and administrative entity in the Executive Branch in the
promotion, development and regulation of dependable and coordinated networks of.
transportation and communications system, as well as in the fast, safe, efficient and
reliable postal, transportation and communications services;
WHEREAS, in order for the DOTC to effectively oversee and monitor the implementation
of the North Rail Project, there is a need to transfer administrative supervision over
NORTHRAIL from the Office of the President to the DOTC and to reorganize the
respective Governing Boards of NORTHRAIL and the PNR to include the DOTC
Secretary as ex-officio Co-Chairman thereof;
NOW, THEREFORE, I, GLORIA MACAPAGALARROYO, President of the Republic
of the Philippines, by virtue of the powers vested in me by law, do hereby order:
SECTION 1. Primary Oversight Functions.The DOTC Secretary is hereby directed
to exercise primary oversight functions over the North Rail Project to oversee and
monitor the effective and efficient implementation thereof.
SECTION 2. Transfer of NORTHRAIL.NORTHRAIL is hereby transferred from the
Office of the President to the DOTC, which shall exercise administrative supervision
over the said agency.

187

Laws on Bases Conversion

NORTHRAIL PROJECT - Executive Order No. 232

SECTION 3. DOTC Secretary as Ex-Officio Co-Chairman.In order to carry out his


functions under the provisions hereof, the DOTC Secretary shall be the ex-officio CoChairman of the respective governing boards of NORTHRAIL and the PNR.
SECTION 4. Assistance.The DOTC Secretary may call upon the Department of
Finance, the Department of Tourism, the Department of Budget and Management
[DBM], the Department of Public Works and Highways, the Department of Environment
and Natural Resources, the National Economic and Development Authority, the
Housing and Urban Development Coordinating Council, the Metropolitan Manila
Development Authority, the BCDA, the Clark Development Corporation, and any other
agency of the Government for such assistance as may be necessary or appropriate in
the performance of his functions.
All heads of departments, agencies, bureaus, offices, including government-owned or
controlled corporations, are hereby enjoined to render full assistance and cooperation
to the DOTC Secretary and provide such information and data as may be required to
carry out his functions pursuant to this Order.
SECTION 5. Internal Audit.An internal auditor for the North Rail Project shall be
designated by the DOTC Secretary. Such internal auditor shall have the duty, among
others, of reviewing and checking the disbursements made from the proceeds of
applicable loan agreements as well as the Philippine Government counterpart funds.
The internal auditor shall report to and shall be under the supervision of the DBM
Secretary.
SECTION 6. Repealing Clause.All executive issuances, rules and regulations, or
parts thereof which are inconsistent with this Executive Order are hereby repealed,
amended, or modified accordingly.
SECTION 7. Effectivity.This Executive Order shall take effect immediately.
City of Manila, Aug. 19, 2003

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) ALBERTO G. ROMULO


Executive Secretary
Laws on Bases Conversion

188

NORTHRAIL PROJECT - Executive Order No. 859

Executive Order No. 859


Amending Executive Order (EO) No. 232 Dated 19 August 2003 and Making
the North Luzon Railways Corporation (NORTHRAIL) an Agency Attached to
the Department of Transportation and Communications (DOTC)
WHEREAS, under Executive Order (EO) No. 232, the Secretary of the Department of
Transportation and Communications (DOTC) was directed to exercise primary oversight
functionsover the North Rail Project, transferring North Luzon Railways Corporation
from the Office of the President to DOTC and designating the Secretary of DOTC as
Ex-Officio Co-Chairman of the governing board of NORTHRAIL;
WHEREAS, the DOTC as the primary policy, planning, programming,
coordinating,implementing, regulating and administrative entity in the Executive
Branch for the promotion, development and regulation of dependable and coordinated
networks of transportation and communications system and in order for the DOTC to
effectively administer the implementation of the NORTHRAIL Project, there is a need
to amend EO No. 232 dated 19 August 2003 making it an agency attached to the
DOTC.
NOW, THEREFORE, I, GLORIA MACAPAGALARROYO, President of the Republic
of the Philippines, by virtue of the powers vested in me by law, do hereby order:
SECTION 1. Section 1 of EO No. 232 is hereby amended to read as follows:
SECTION 1. Attachment - The North Luzon Railways Corporation (NORTHRAIL)
is hereby made an agency attached to the Department of Transportation and
Communications (DOTC).
SECTION 2. EffectivityThis Executive Order (EO) shall take effect immediately.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

189

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

Executive Order No. 40


Consolidating Procurement Rules and Procedures for All
National Government Agencies, Government-Owned or-Controlled Corporations
and Government Financial Institutions, and Requiring the Use of the
Government Electronic Procurement System
WHEREAS, the government is committed to good governance;
WHEREAS, the principles of good governance call for transparency, accountability,
equity, efficiency and economy in the government procurement process, and the
eradication of malpractices, particularly graft and corruption;
WHEREAS, there is an urgent need to consolidate existing administrative orders,
issuances, rules and regulations on the procurement of goods, civil works and
consulting services and to develop a single set of rules that embodies a streamlined
procurement process uniformly applicable to all government procurement;
WHEREAS, it is imperative that the procurement process be made adaptable to, and
utilize advances, in modern technology;
WHEREAS, in the pursuit of good governance, the government shall adopt an electronic
procurement process that will uniformly apply to all government procurement; and
WHEREAS, to enhance transparency in government procurement, the government
shall encourage the public to monitor the procurement process and the awarding
of contracts with the end in view of guaranteeing that these contracts are awarded
pursuant to law.
NOW, THEREFORE, I, GLORIA MACAPAGAL ARROYO, President of the Republic
of the Philippines, by virtue of the powers vested in me by law, do hereby order:
General Provisions
Section 1. Scope and Application. This Executive Order shall apply to the procurement
of: (a) goods, supplies, materials and related services; (b) civil works; and (c) consulting
services, by all National Government agencies, including State Universities and Colleges
(SUCs), Government-Owned or -Controlled Corporations (GOCCs) and Government
Financial Institutions (GFIs), hereby referred to as "Agencies." This Executive Order
shall cover the procurement process from the pre-procurement conference up to
award of contract.
Nothing in this Order shall negate any existing and future government commitments
with respect to the bidding and award of contracts financed partly or wholly with funds

Laws on Bases Conversion

190

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

from international financing institutions as well as from bilateral and other similar
foreign sources.
Section 2. Statement of Policy. It is the policy of the government that procurement
shall be competitive and transparent and therefore shall be through public bidding,
except as otherwise provided in this Executive Order.
Section 3. General Guidelines. Government procurement shall be guided by the
following reform principles:
(a) Simplification of pre-qualification through the use of an eligibility check, and
strengthening of post-qualification;
(b) Use of the Lowest Calculated and Responsive Bid as the criterion of award in
the case of procurement of goods, supplies, materials and related services; and
civil works;
(c) Use of the approved budget for the contract as the ceiling for the bid price and
the award; and
(d) Use of transparent, objective and non-discretionary criteria which are included
in the bid documents, in undertaking the eligibility check, evaluating bids and
determining the winning bidder through post-qualification.
Section 4. Procurement Management Plan. Each agency shall judiciously prepare,
maintain and update its Agency Procurement Management Plan (APMP) for all its
procurement. The APMP shall include a Project Procurement Management Plan
(PPMP) for each project.
Section 5. Procurement of Common-use Supplies, Materials and Equipment. Agencies
shall procure common-use supplies, materials and equipment from the Procurement
Service (PS) attached to the Department of Budget and Management (DBM), in
accordance with Letter of Instructions No. 755, Executive Order Nos. 289 series of
1987, 359 series of 1989, and 322 series of 2000, using the Electronic Procurement
System (EPS) referred to in Section 37 of this Executive Order. Agencies without
internet access may avail of the EPS Public Access Terminals which shall be installed at
DBM designated locations in the provinces and in Metro Manila: Provided, however,
That agencies shall comply with Section 38 of this Executive Order. Small volume
purchases by agencies, as defined in the implementing rules and regulations (IRR) of
this Executive Order, through the electronic catalogue of non common-use goods,
supplies and materials are allowed without need of public bidding.

191

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

Section 6. Manuals, Standard Bidding Documents and Training. The Procurement


Policy Board (PPB), created under Executive Order No. 359 series of 1989, and the
Committee on Infrastructure (Infracom) of the National Economic and Development
Authority Board shall pursue the development of a generic procurement manual and
standard bidding documents, and shall establish a sustainable training program for
developing the capacity of the BACs, Secretariats and Technical Working Groups of
the agencies.
Bids

and

Awards Committee

Section 7. The BAC and its Composition. Each agency shall establish a single Bids and
Awards Committee (BAC) for its procurement. The BAC shall be chaired by at least a
third ranking officer of the procuring entity, and its composition shall be specified in
the IRR. Alternatively, as may be deemed fit by the agency head, there may be separate
BACs where the number and complexity of the items to be procured shall so warrant.
Similar BACs for decentralized and lower level offices may be formed when deemed
necessary by the head of the agency.
Section 8. Functions of the BAC. The BAC shall, among others, determine the
eligibility of prospective bidders, receive and open bids, conduct the evaluation of
bids, undertake postqualification proceedings, and recommend the award of contract.
The scope of the BAC activities is from the pre-procurement conference up to the
recommendation of award. All members of the BAC shall be on "jury duty" type of
assignment until the notice of award is issued by the agency head.
Section 9. Observers. To enhance the transparency of the procurement process, the
BAC shall invite, in addition to the representative of the Commission on Audit, at least
two (2) observers from the relevant sectors to sit in and monitor the proceedings.
Section 10. Checks and Balances. The BAC chairperson and the official who shall
approve the ensuing contract for the agency shall not be the same person.
Section 11. BAC Secretariat. The agency shall have a Secretariat or a designated
organic office as the main support unit of the BAC(s). It shall be separately designated
by the head of agency or the appropriate designating authority, and shall be under the
supervision of the BAC(s). Similarly, a Secretariat may also be formed in decentralized
and lower level offices to support the local BAC(s) that may be established.
Section 12. Technical Working Group. For each specific procurement, the BAC may
create a Technical Working Group from a pool of technical financial and/or legal
experts to assist in the evaluation of bids.

Laws on Bases Conversion

192

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

Standardized Procedures

for

Public Bidding

Section 13. Pre-Procurement Conference. Prior to the issuance of the invitation to


bid, the BAC shall call a pre-procurement conference for each procurement, except
for small procurement.
The pre-procurement conference shall assess the readiness of the procurement in terms
of confirming the certification of availability of funds, as well as reviewing all relevant
documents in relation to their adherence to law. This shall be attended by the BAC, the
unit or officials who prepared the bidding documents and the draft invitation to bid,
including consultants hired by the agency concerned, as well as representatives of the
end-users.
Section 14. Invitation to Bid. The invitation to bid shall contain, among others: a brief
description of the items to be procured; the eligibility requirements; the place, date
and time of the deadlines for receipt of eligibility requirements and bids; the approved
budget for the contract to be bid; the time and place of the opening of bids; and the
contract duration or delivery schedule.
The invitation to bid shall be advertised in such manner and for such period of time
as to ensure the widest possible dissemination, the details of which shall be provided
in the IRR.
Section 15. Pre-Bid Conference. The BAC shall convene a pre-bid conference for
contracts consisting P1,000,000 or more to explain any of the requirements, terms and
conditions, and specifications stipulated in the bid documents. For contracts below
P1,000,000, the pre-bid conference is optional at the discretion of the BAC.
Section 16. Eligibility Check of Prospective Bidders for the Procurement of (a) Goods,
Supplies, Materials and Related Services; and (b) Civil Works. The BAC or its duly
designated organic office shall determine the eligibility of prospective bidders for the
procurement of: (a) goods, supplies, materials and related services; and (b) civil works,
based on submission of the eligibility requirements provided in the bidding documents.
The documents submitted in satisfaction of the eligibility requirements shall be made
under oath by the prospective bidder or by his duly authorized representative certifying
to the correctness of the statements and authenticity of the said documents.
Section 17. Eligibility Check and Short Listing of Prospective Bidders for Consulting
Services. The BAC or its duly designated organic office shall determine the eligibility of
prospective bidders for the procurement of consulting services using numerical ratings
on the basis of the eligibility requirements provided in the bidding documents, to
determine the short list of bidders whose bids shall be considered for evaluation. The
short list shall consist of the highest ranked eligible bidders from three (3) to seven (7)
in number, as predetermined by the BAC and as indicated in the invitation to bid. The
documents submitted in satisfaction of the eligibility requirements shall be made under

193

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

oath by the prospective bidder or by his duly authorized representative certifying to the
correctness of the statements and authenticity of the said documents.
Section 18. Submission and Receipt of Bids. A bid shall have two components,
namely the technical and financial components which should be in separate sealed
envelopes, which shall be submitted simultaneously. The bids shall be received by the
BAC on such date, time and place specified in the invitation to bid. The deadline for
the receipt of bids shall be fixed by the BAC, giving it sufficient time to complete the
bidding process and giving the prospective bidders sufficient time to study and prepare
their bids. The deadline shall also consider the urgency of the procurement involved.
Section 19. Bid Security. Except for the procurement of consulting services, each bid
shall be accompanied by a bid security which shall serve as a guarantee that, after
receipt of the notice of award, the winning bidder shall enter into contract with the
agency within the stipulated time and shall furnish the required performance security.
The amount and allowable forms of the bid security, as well as the manner by which
it may be returned to the bidders, shall be provided for in the IRR, notwithstanding
Sections 32 and 44 herein.
Section 20. Modification and Withdrawals of Bids. A bidder may modify his bid,
provided that this is done at least five (5) calendar days before the deadline for the
receipt of bids. The modification shall be submitted before the deadline for receipt
of bids in a sealed envelope duty identified as a modification of the original bid and
stamped received by the BAC. A bidder may also withdraw his bid or express his
intention not to participate in the bidding before the deadline for the receipt of bids.
Section 21. Single Calculated/Rated and Responsive Bid Submission. A single
calculated/rated and responsive bid shall be considered under any of the following
exceptional circumstances, notwithstanding the provisions of Section 17:
(a) If after advertisement, only one prospective bidder applies for eligibility check
and he meets the eligibility check requirements, after which his bid is found to
be responsive;
(b) If after advertisement, more than one prospective bidder applies for eligibility
check but only one meets the eligibility check requirements, after which his
bid is found to be responsive; or
(c) If after the eligibility check of more than one bidder, only one bid is submitted
and found to be responsive.
Section 22. Bid Opening and Examination. For the procurement of: (a) goods,
supplies, materials and relevant services; and (b) civil works, the BAC shall examine
first the technical components of the bids using "pass/fail" criteria to determine whether
all required documents are present. Only bids that are determined to contain all the
Laws on Bases Conversion

194

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

bid requirements of the technical component shall be considered for opening and
evaluation of its financial component.
Section 23. Bid Evaluation. The BAC shall evaluate the financial component of the
bids and correct it for minor deviations, such as computational errors, omissions and
discounts, in accordance with the bidding documents to enable proper comparison
of all eligible bids. Any adjustment to correct minor deviations shall be calculated
in monetary terms to determine the calculated prices. The bids shall be ranked from
lowest to highest in terms of their corresponding calculated prices. For the procurement
of: (a) goods, supplies, materials and related services; and (b) civil works, the bid with
the lowest calculated price shall be referred to as the "LOWEST CALCULATED BID."
Section 24. Bid Evaluation of Short Listed Bidders for Consulting Services. For the
procurement of consulting services, the BAC shall evaluate bids of the short listed
bidders and rank them using numerical ratings in accordance with the evaluation
criteria stated in the bid documents. The bids shall be ranked from highest to lowest
in terms of their corresponding calculated ratings. The bid with the highest calculated
rating shall be referred to as the "HIGHEST RATED BID."
Section 25. Ceiling for Bid Price. The approved budget for the contract shall be the
upper limit or ceiling for the bid price. Bid prices which exceed this ceiling shall
be disqualified outright from further participating in the bidding. There shall be no
lower limit to the amount of the award. For this purpose, the approved budget for the
contract shall be that approved by the head of the agency.
Section 26. Major Deviation. The BAC shall automatically disqualify a bid that
contains a major deviation. A major deviation is a deviation in a bid that if allowed
would not fulfill the purpose for which the bid was requested, or would prevent a fair
comparison with bids that comply with the bidding documents as defined in the IRR.
Section 27. Postqualification. The BAC shall undertake postqualification which
involves the verification and validation of all documents submitted by the bidder
with the Lowest Calculated Bid or the Highest Rated Bid, as the case may be and all
information or statements contained therein to determine whether he satisfies all the
requirements and conditions as specified in the bidding documents, in which case his
bid shall be considered the "LOWEST CALCULATED AND RESPONSIVE BID" in the
case of goods, supplies, materials, related services and civil works or the "HIGHEST
RATED AND RESPONSIVE BID" in the case of consulting services.
Section 28. Procurement Outsourcing. In order to hasten project implementation,
agencies which may not have the proficiency or capability to undertake a particular
procurement, as determined by their heads, may request other agencies to undertake
such procurement for them, or at their option, recruit and hire consultants or
procurement agents to assist them directly and/or train their staff in the management
of procurement function.

195

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

Section 29. Reservation Clause. The government reserves the right to reject any and
all bids, or declare a failure of bidding, or not award the contract for any justifiable
reason including among others, if there is a evidence of collusion between relevant
public officers or employees of the agency or the BAC and any of the bidders or among
the bidders, or between the bidders and third parties, including any act which restricts,
suppresses or nullifies competition, of if the BAC is found to have failed to follow the
prescribed bidding procedures.
Award

of

Contract

Section 30. Award of Contract and Notice to Proceed. The head of the agency or his
duly authorized agency representative shall award and issue the corresponding notice
to proceed, when applicable, to the bidder with the Lowest Calculated and Responsive
Bid or the Highest Rated and Responsive Bid, as the case may be, in accordance with
deadlines specified in the IRR.
Section 31. Performance Security. Except for the procurement of consulting services,
prior to contract signing, the winning bidder shall post a performance security in the
form and amount specified in the bidding documents in accordance with the IRR, to
guarantee the faithful performance of and compliance with his obligations under the
contract in accordance with the bidding documents.
Section 32. Failure to Enter into Contract and Post Performance Security. If the bidder
with the Lowest Calculated and Responsive Bid or the Highest Rated and Responsive
Bid, as the case may be, fails, refuses or is unable to make good his bid by entering into
contract with the agency or, in the case of goods, supplies, materials, related services
and civil works, post the required performance security within the period stipulated
in the bidding documents, the bid security shall be forfeited where so applicable, and
the appropriate administrative sanctions shall be imposed except where such failure,
refusal or inability is through no fault of his. Thereupon, the BAC shall disqualify the
said bidder and shall postqualify the next ranked Lowest Calculated Bid or Highest
Rated Bid, as the case may be. This procedure shall be repeated until an award is
made. However, if no award is made, the contract shall be re-bid.
Section 33. Price Adjustment. Price adjustments may be allowed under extraordinary
circumstances, as defined in the IRR, and upon prior approval of the PPB.
Section 34. Period for Action on Procurement Activities. The procurement process
from the opening of bids up to the award of contract shall not exceed three (3)
months, or a shorter period to be determined by the agency concerned. The different
procurement activities shall be completed within reasonable periods to be specified
in the IRR. In addition, the agency head shall take action on the recommendation of

Laws on Bases Conversion

196

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

award of the BAC, and shall act on the notice of award, as well as the approval of
contract within fifteen (15) calendar days from receipt thereof. In the case of GOCCs
and GFIs, the concerned board shall take action on the said recommendation within
thirty (30) calendar days from receipt thereof.
Alternative Methods

of

Procurement

Section 35. Alternative Methods. When justified by extraordinary conditions as


provided in this Executive Order and its IRR, and subject to the prior approval of the
head of the agency in the interest of economy and efficiency, the agency head, upon
the recommendation of the BAC, may adopt alternative methods of procurement.
Such alternative methods of procurement can take the following forms:
a)
b)
c)
d)
e)

Limited Source Bidding, otherwise known as Selective Bidding;


Direct Contracting, otherwise known as Single Source procurement;
Repeat Order;
Shopping; or
Negotiated Procurement.

Procurement

of Information and

Communications Technology Projects

Section 36. Information and Communications Technology Projects. The procurement


of information and communications technology (ICT) projects shall be governed by
the following rules, subject to additional guidelines that may be prescribed by the
Information Technology and E-Commerce Council (ITECC):
a) The procurement of ICT equipment and/or software only shall be considered
as procurement of good, supplies, materials and related services.
b) The procurement of ICT projects involving the establishment of physical
networks only shall be considered as procurement of civil works.
c) The procurement of ICT projects involving development of software or systems
only shall be considered as procurement of consulting services.
d) In the case of ICT projects involving at least two of the foregoing, the procurement
shall be considered as either one for: (a) goods, supplies, materials and related
services; (b) civil works; or (c) consulting services, whichever component has
the greater or greatest cost.

197

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

The Government E-Procurement System


Section 37. The Electronic Procurement System. Pursuant to Republic Act (R.A.) No.
8792, the "Electronic Commerce Act," the government shall establish a single and
centralized electronic portal for the procurement of: (a) goods, supplies, materials and
related services; (b) civil works; and (c) consulting services, to be used by agencies,
herein referred to as the EPS to enhance transparency, accountability, equity, efficiency
and economy in government procurement. The PS under the supervision of PPB shall
be responsible for the establishment, management, operation and maintenance of the
EPS.
Section 38. Use of the EPS. All agencies are hereby mandated to fully use the EPS
in accordance with the policies, rules, regulations and procedures adopted by PPB.
In connection thereto and in accordance with R.A. No. 8792, the above- mentioned
agencies shall undertake measures to ensure that they shall have an access to an on-line
network to facilitate the open, speedy and efficient on-line transmission, conveyance
and use of electronic data messages or electronic documents, and recognize the EPS as
the primary source of information on government procurement of: (a) goods, supplies,
materials and related services; (b) civil works; and (c) consulting services. All notices
and certifications to be issued by the BAC with respect to a procurement shall be done
through the EPS.
Section 39. Features of the EPS. The EPS includes the following features:
a) Electronic Bulletin Board. A centralized electronic bulletin board for advertising
procurement opportunities, notices, awards and reasons for awards.
b) Suppliers Contractors and Consultants Registry. A centralized electronic
registry of all authorized suppliers, consultants and contractors, as defined in
the IRR.
c) Electronic Catalogue. A centralized electronic price list consisting of two
categories, in particular: (i) Common-use goods, supplies, materials and related
services in the stores of PS shall be carried in the PS Electronic Catalogue; and
(ii) for non common-use goods, supplies, materials and related services, as well
as for civil works and consulting services, the EPS-registered and accredited
suppliers, consultants and contractors thereof shall have their respective
electronic catalogues which shall be hosted by, or linked to, the EPS website.
d) Additional Features. The Virtual Store, electronic bid submission, on-line
payment, and such other features that may be developed in the future.

Laws on Bases Conversion

198

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

Section 40. Security, Integrity and Confidentiality. The EPS shall ensure the security,
integrity and confidentiality of documents submitted through the system. It shall
include a feature that provides for an audit trial for on-line transactions and allows
the Commission on Audit to verify the security and integrity of the system at any time.
Section 41. Observers. The EPS shall allow observers authorized by the BAC to
monitor the procurement proceedings on-line: Provided, however, That such observers
do have any direct or indirect interest in the contract to be bid out.
Procurment Monitoring
Section 42. Procurement Monitoring. The head of the BAC Secretariat shall have
the responsibility for monitoring the performance against standards set forth by this
Executive Order, its IRR, and existing rules and regulations. The head of the Secretariat
shall prepare a procurement monitoring report that shall be approved and submitted
by the head of the procuring agency on a quarterly basis. The contents and coverage
of this report shall be provided for in the IRR.
Incentives

and

Sanctions

Section 43. Incentives and Sanctions. In consultation with agencies and the Civil
Service Commission, the PPB and Infracom shall establish:
a) an equitable indemnification package for officials/staff providing services in the
BAC, Secretariat and the Technical Working Group, which may be in the form
of free legal assistance, liability insurance, and other forms of indemnification
and protection; and
b) a set of sanctions for violations of this Executive Order and its IRR committed
by officials/staff providing services in the BAC, Secretariat, and the Technical
Working Group.
Section 44. Administrative Penalties for Bidders and Prospective Bidders. The head of
the agency shall impose on bidders or prospective bidders, the administrative penalties
of suspension from participating in any public bidding of the agency for one (1) year for
the first offense and two (2) years for the second offense, as well as disqualification from
further participating in the public bidding currently being under taken by the agency
concerned where applicable, for the following violations, without prejudice to the
imposition of criminal and civil sanctions as provided by laws, rules and regulations:
a) Submission of eligibility requirements containing false information or falsified
documents.
b) Submission of bids that contain false information or falsified documents of the
concealment of such information in the bids.

199

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

c) Allowing the use of ones name, or using the name of another, for purposes of
public bidding.
d) Withdrawal of a bid or refusal to accept an award or enter into contract with
the government without just cause, after it shall have been determined to have
submitted the Lowest Calculated and Responsive Bid or the Highest Rated and
Responsive Bid, as the case may be.
e) Refusal or failure to post the required performance security within the
prescribed time.
f) Termination of the contract due to the default of the bidder.
g) Any documented unsolicited attempt by a bidder to unduly influence the
outcome of the bidding in his favor.
h) All other acts that tend to defeat the purpose of the public bidding.
In addition to the above administrative penalties, the bid security or the performance
security of the bidder concerned, where so applicable, shall also be forfeited.
The authority to impose the above-mentioned administrative penalties may be
delegated by the head of the agency to the BAC.
Final Provisions
Section 45. Local Government Units. All procurement of local government units
funded by the national government shall be governed by the provisions of this Executive
Order and its IRR. Furthermore, local government units are encouraged to apply the
rules and procedures provided in this Executive Order for procurement funded from
the local government funds.
Section 46. Appeals. Decision of the BAC in al stages of procurement may be appealed
to the head of the agency in writing. Appeals shall be made by filing a verified position
paper and paying a non-refundable protest fee. The amount of the protest fee and the
periods during which the appeals may be filed and resolved shall be specified in the
IRRs.
Section 47. Implementing Rules and Regulations (IRR). Within sixty (60) calendar
days from the issuance of this Executive Order, the PPB and the Infracom shall jointly
issue the policies, rules, regulations and procedures to implement this Executive Order,
leading to a more transparent and efficient procurement system for the government.
These IRR may be amended jointly by the PPB and the Infracom as the need arises.

Laws on Bases Conversion

200

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 40

Section 48. Repealing Clause. All executive issuances, orders, rules and regulations
or parts thereof inconsistent with this Executive Order are hereby repealed, amended
and/or modified accordingly.
Section 49. Separability Clause. If any provision of this Executive Order is declared
invalid or unconstitutional, the other provisions not affected hereby shall remain valid
and subsisting.
Section 50. Effectivity Clause. This Executive Order shall take effect fifteen (15) day
after its publication in the Official Gazette or in a newspaper of general circulation.
DONE in the City of Manila, this 8th day of October in the year of Our Lord, Two
Thousand and One.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) ALBERTO G. ROMULO


Executive Secretary

201

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 423

Executive Order No. 423


Repealing Executive Order No. 109-A Dated September 18, 2003
Prescribing the Rules and Procedures on the Review and Approval of
All Government Contracts to Conform with Republic Act No. 9184
Otherwise Known as The Government Procurement Reform Act
WHEREAS, the Arroyo Administration is committed to speedy and efficient delivery of
quality services to the Filipino people;
WHEREAS, the procurement process must be simplified in order that all branches,
departments, agencies, subdivisions, and instrumentalities of the government, including
government owned and controlled corporations, and local government units be able
to secure the goods and services when needed;
WHEREAS, Republic Act No. 9184, otherwise known as "the Government Procurement
Reform Act", which was enacted into law on January 10, 2003, likewise declared
it the policy of the State to promote the ideals of good governance, with a view to
transparency, competitiveness, streamlining, accountability and public monitoring in
the procurement processes of Government Contracts;
WHEREAS, in line with the government's program of good governance, Executive
Order No. 109-A dated September 18, 2003 entitled "Amending Executive Order
No. 109 dated May 27, 2002 Prescribing the Rules and Procedures on the Review
and Approval of all Government Contracts to Conform with Republic Act No. 9184,
otherwise known as 'the Government Procurement Reform Act Streamlining the Rules
And Procedures on The Review and Approval Of All Contracts Of Departments,
Bureaus, Offices And Agencies Of The Government, Including Government-Owned
Or Controlled Corporations And Their Subsidiaries" was issued to conform with the
provisions of Republic Act No. 9184 which consolidated the procurement processes of
Government Contracts, including the procurement of infrastructure projects, goods
and consulting services, and lease of goods and real estate, among others;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Philippines,
by virtue of the powers vested in me by law, do hereby order:
SECTION 1. Policy Requiring Public Bidding.It is the policy of this Administration
that all Government contracts of Government Agencies shall be awarded through
open and competitive public bidding, save in exceptional cases provided by law and
applicable rules and regulations, as described in Section 3 of this Executive Order.
For this purpose, a Government Agency shall refer to the various units of the
Government, including a department, bureau, office, instrumentality, governmentowned and/or controlled corporation or its subsidiary, or state college or university
Laws on Bases Conversion

202

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 423

(Section 2[4] of Executive Order No. 292 dated July 25, 1987, otherwise known as the
Administrative Code of 1987).
SECTION 2. Approval of Government Contracts Awarded Through Public Bidding.
Except for Government contracts required by law to be acted upon and/or approved
by the President, the Heads of the Procuring Entities shall have full authority to give
final approval and/or to enter into all Government contracts of their respective agencies
awarded through public bidding, regardless of the amount involved. Provided, that the
Head of the Procuring Entity certifies under oath that the contract has been entered
into in faithful compliance with all applicable laws and regulations.
The Heads of the Procuring Entities may delegate in writing this full authority to give
final approval and/or to enter into Government contracts awarded through public
bidding, as circumstances may warrant (i.e., decentralization of procurement in a
Government Agency), subject to such limitations imposed by the Head of the Procuring
Entity concerned (Section 5(j), Republic Act No. 9184).
As defined under Section 5(j) of Republic Act No. 9184, a Head of the Procuring Entity
refers to (i) the head of the agency or his duly authorized official, for national government
agencies; or (ii) the governing board or its duly authorized official, for governmentowned and/or controlled corporations, among others.
SECTION 3. Exceptions to Public Bidding.Sections 48 to 53 of Republic Act No.
9184 and its Implementing Rules and Regulations provide for exceptional cases where
the procurement of infrastructure projects, goods and consulting services may be
undertaken through alternative methods of procurement.
SECTION 4. Approval of Government Contracts Entered Into Through Alternative
Methods of Procurement.
a. For Government Contracts Involving An Amount Of At Least Five Hundred
Million Pesos (P500 Million).Where the Head of the Procuring Entity has
made a determination that a Government contract, including Government
contracts required by law to be acted upon and/or approved by the President,
involving an amount of at least Five Hundred Million Pesos (P500 Million)
falls under any of the exceptions from public bidding described in Section
3 hereof, the Head of the Procuring Entity shall, before proceeding with the
alternative methods of procurement provided by law and applicable rules and
regulations, obtain the following requirements:
i. An opinion from the Government Procurement Policy Board (GPPB) that
said Government contract falls within the exceptions from public bidding;
and

203

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 423

ii. Approval from the Director-General of NEDA to proceed with a specific


alternative method of procurement under the exceptional cases provided
by law and applicable rules and regulations.
Except for Government contracts required by law to be acted upon and/
or approved by the President, the Heads of the Procuring Entities, after
obtaining the foregoing requirements, shall have full authority to give final
approval and/or to enter into said Government contracts of their respective
agencies, entered into through alternative methods of procurement
allowed by law. Provided, that the Head of the Procuring Entity certifies
under oath that the contract has been entered into in faithful compliance
with all applicable laws and regulations.
b. For Government Contracts Involving An Amount Below Five Hundred Million
Pesos (P500 Million).Except for Government contracts required by law to
be acted upon and/or approved by the President, the Heads of the Procuring
Entities shall likewise have full authority to give final approval and/or to enter
into Government contracts of their respective agencies, entered into through
alternative methods of procurement allowed by law. Provided, that the
Department Secretary certifies under oath that the contract has been entered
into in faithful compliance with all applicable laws and regulations.
The Heads of the Procuring Entities may delegate in writing this full authority
to give final approval and/or to enter into Government contracts involving
an amount below Five Hundred Million Pesos (P500 Million) entered into
through alternative methods of procurement allowed by law, as circumstances
may warrant (i.e., decentralization of procurement in a Government Agency),
subject to existing laws and such limitations imposed by the Head of the
Procuring Entity concerned (Section 5(j), Republic Act No. 9184).
SECTION 5. Authority to Bind the Government.All Government contracts shall require
the approval and signature of the respective Heads of the Procuring Entities or their
respective duly authorized officials, as the case may be, as required by law, applicable
rules and regulations, and by this Executive Order, before said Government contracts
shall be considered approved in accordance with law and binding on the government,
except as may be otherwise provided in Republic Act No. 9184. For Government
contracts required by law to be acted upon and/or approved by the President, Section
6 of this Executive Order governs the process by which such Government contracts
shall be considered entered into with authority and binding on
the Government.
The Heads of the Procuring Entities or their respective duly authorized officials, as the
case may be, shall be responsible and accountable for ensuring that all Government

Laws on Bases Conversion

204

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 423

contracts they approve and/or enter into are in accordance with existing laws, rules
and regulations and are consistent with the spending and development priorities of
Government.
All Government contracts entered into in violation of the provisions of law, rules and
regulations, and of this Executive Order shall be considered contracts entered into
without authority and are thus invalid and not binding on the Government.
SECTION 6. Government Contracts Requiring Presidential Action and/or Approval.
a. All Government contracts required by law to be acted upon and/or approved by
the President, and any subsequent amendments or supplements thereto, shall
not be signed until after the NEDA Board, which is chaired by the President,
has favorably acted upon and/or approved the same.
b. All Government contracts required by law to be acted upon and/or approved
by the President, and any subsequent amendments or supplements thereto,
shall be submitted with complete documentation to NEDA, through its
DirectorGeneral, within seven (7) days from the approval by the Head of the
Procuring Entity concerned or his/its duly authorized official, as the case may
be, for NEDAs review and evaluation.
Government contracts submitted hereunder shall be accompanied by a
complete execution copy of the contract, related agreements, annexes, other
approvals and permits, including a detailed summary of the pertinent laws,
rules and regulations governing the processing and award of the contract, and
accompanied by the requirements of Section 4(a) hereof where alternative
methods of procurement were resorted to.
c. Within thirty (30) days from its receipt of the Government contract with
complete documentation, and any subsequent amendments or supplements
thereto, NEDA shall submit, its recommendation to the NEDA Board, which is
chaired by the President, for appropriate action. The NEDA Board, at a meeting
chaired by the President, shall then act and/or approve the Government
contract, as it deems appropriate.
d. Within seven (7) days from the date of the NEDA Boards action, NEDA,
through its Director-General, shall formally notify the Head of the Procuring
Entity concerned or his/its duly authorized official, as the case may be, of the
action of the NEDA Board, including any comments thereon.
e. Should the NEDA favorably act on the contract, the Department Secretary
and Head of the Procuring Entity is hereby given full powers and authority
to approve, sign, execute and deliver any deed or document necessary and
proper for the execution and implementation of such contract and subsequent
amendments or supplements thereto. Provided, that the Department Secretary

205

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 423

and Head of Procuring Entity shall certify under oath that: (1) such contract
complies with the Constitution and all existing laws, rules and regulations
and that (2) such contract is not grossly disadvantageous to the government.
SECTION 7. Governing Law for Government Contracts.
a. Contracts for the Procurement of Infrastructure Projects, Goods, and Consulting
Services. Contracts for the procurement of infrastructure projects, goods,
and consulting services shall be governed by Republic Act No. 9184 and its
Implementing Rules and Regulations (Section 4, Republic Act. No. 9184).
Contracts for the lease of goods and real estate shall be governed by Republic
Act No. 9184 and its Implementing Rules and Regulations (Section 5[n],
Republic Act No. 9184).
b. Contracts for Acquisition of Right-of-Way, Site or Location for National
Government Infrastructure Projects. Contracts for the acquisition of real
property needed as right-of-way, site or location for national government
infrastructure projects shall be governed by Republic Act No. 8974 (Section
5[n]), Republic Act No. 9184).
c. BOT Contracts. Contracts undertaken through Build-Operate and Transfer
(BOT) schemes and other variations shall be governed by Republic Act No.
6957, as amended by Republic Act No. 7718, and its Implementing Rules and
Regulations.
d. ODA-funded Contracts. Government Contracts financed wholly or partly with
Official Development Assistance (ODA) funds shall be governed by Republic
Act No. 4860, as amended, Republic Act No. 8182, as amended by Republic
Act No. 8555, and Republic Act No. 9184 and its Implementing Rules and
Regulations (Section 4, Republic Act No. 9184).
The GPPB may issue guidelines for Government Contracts financed with ODA
funds with the objective of promoting transparency, competitiveness, and
accountability in government transactions, and, where applicable, complying
with the requirements of an open and competitive public bidding, consistent
with Republic Act No. 9184 and its Implementing Rules and Regulations
(Section 4, Republic Act No. 9184).
SECTION 8. Joint Venture Agreements.The NEDA, in consultation with the GPPB,
shall issue guidelines regarding joint venture agreements with private entities with
the objective of promoting transparency, competitiveness, and accountability in
government transactions, and, where applicable, complying with the requirements of
an open and competitive public bidding.

Laws on Bases Conversion

206

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 423

SECTION 9. Transactions of Government Financial Institutions.Transactions of


government financial institutions in the ordinary course of business shall not be
covered by the provisions of this Executive Order. Such transactions shall instead be
subject to applicable provisions of law and to guidelines, rules and regulations issued
by the Department of Finance.
SECTION 10. Submission of Government Contracts.With a view to creating a
repository of all important Government contracts, a complete copy of all Government
contracts involving an amount of at least Three Hundred Million Pesos (P300 Million)
shall be submitted to NEDA, through its Director-General, within seven (7) days from
the date of signing and/or approval thereof, accompanied with a complete copy of its
related agreements, annexes, other approvals and permits, and a detailed summary of
the pertinent laws, rules and regulations governing the processing and award of the
contract.
SECTION 11. Splitting of Government Contracts.Splitting of Government contracts
is not allowed. Splitting of Government contracts means the division or breaking up of
Government contracts into smaller quantities and amounts, or dividing contract
implementation into artificial phases or sub-contracts for the purpose of evading or
circumventing the requirements of law and this Executive Order, especially the necessity
of public bidding and the requirements for exceptions therefrom in accordance with
Section 4(a) hereof.
SECTION 12. Local Government Units.Procurement contracts of local government
units, regardless of the source of funds, shall be subject to the provisions of Republic
Act No. 9184 and its Implementing Rules and Regulations.
SECTION 13. Prospective Application.All Government contracts, including those
presently being processed and/or reviewed in accordance with Executive Order No.
109-A dated September 18, 2003, shall hereafter be processed and/or reviewed in
accordance with this Executive Order.
SECTION 14. Repeal and Amendment.Executive Order No. 109-A dated September
18, 2003 is hereby repealed. All orders, issuances, memoranda and other presidential
issuances expressly repealed by the said Executive Order 109-A shall remain repealed.
Memorandum Order No. 266 dated November 28, 1980 insofar as it relates to
joint venture agreements with private entities, and Department of Public Works and
Highways Circular No. 125, series of 1993, insofar as it relates to the lease of real
estate, are hereby amended accordingly.
All other presidential directives, issuances, orders, rules and regulations or parts
thereof inconsistent with this Executive Order are likewise hereby repealed or modified
accordingly.

207

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 423

SECTION 15. Effectivity.This Executive Order shall take effect immediately upon
publication in two (2) newspapers of general circulation.
DONE in the City of Manila, this 30th day of April, Two Thousand and Five.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

Laws on Bases Conversion

208

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 596

Executive Order No. 596


Defining and Including Government Instrumentality Vested with Corporate Powers
or Government Corporate Entities Under the Jurisdiction of the
Office of the Government Corporate Counsel (OGCC) as Principal Law Office
of Government-Owned or Controlled Corporations (GOCCs)
and for other Purposes
WHEREAS, the Office of the Government Corporate Counsel (OGCC), as the
principal law office of all Government-Owned or Controlled Corporations (GOCCs),
including their subsidiaries, other corporate offsprings and government acquired
assets corporations, plays a very significant role in safeguarding the legal interests and
providing the legal requirements of all GOCCs;
WHEREAS, there is an imperative need to integrate, strengthen and rationalize the
powers and jurisdiction of the OGCC in the light of the Decision of the Supreme
Court dated July 20, 2006, in the case of Manila International Airport Authority vs.
Court of Appeals, City of Paraaque, et al. (G.R. No. 155650), where the High Court
differentiated government corporate entities and government instrumentalities with
corporate powers from GOCCs for purposes of the provisions of the Local Government
Code on real estate taxes, and other fees and charges imposed by local government
units;
WHEREAS, in the interest of an effective administration of justice, the application and
definition of the term GOCCs need to be further clarified and rationalized, to have
consistency in referring to the term and to avoid unintended conflicts and/or confusion;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic of
the Philippines, by virtue of the powers vested in me by law, do hereby order:
SECTION 1. The Office of the Government Corporate Counsel (OGCC) shall be
the principal law office of all GOCCs, except as may otherwise be provided by
their respective charter or authorized by the President, their subsidiaries, corporate
offsprings, and government acquired asset corporations. The OGCC shall likewise be
the principal law office of government instrumentality vested with corporate powers
or government corporate entity, as defined by the Supreme Court in the case of MIAA
vs. Court of Appeals, City of Paraaque, et al., supra, notable examples of which are:
Manila International Airport Authority (MIAA), Mactan International Airport Authority,
the Philippine Ports Authority (PPA), Philippine Deposit Insurance Corporation (PDIC),
Metropolitan Water and Sewerage Services (MWSS), Philippine Rice Research Institute
(PRRI), Laguna Lake Development Authority (LLDA), Fisheries Development Authority
(FDA), Bases Conversion Development Authority (BCDA), Cebu Port Authority (CPA),
Cagayan de Oro Port Authority, and San Fernando Port Authority.

209

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 596

SECTION 2. As provided under PD 2029, series of 1986, the term GOCCs is defined
as a stock or non-stock corporation, whether performing governmental or proprietary
functions, which is directly chartered by a special law or if organized under the general
corporation law, is owned or controlled by the government directly, or indirectly,
through a parent corporation or subsidiary corporation, to the extent of at least a
majority of its outstanding capital stock or of its outstanding voting capital stock.
Under Section 2(10) of the Introductory Provisions of the Administrative Code of 1987,
a government instrumentality refers to any agency of the National Government,
not integrated within the department framework, vested with special functions or
jurisdiction by law; endowed with some, if not all corporate powers, administering
special funds, and enjoying operational autonomy, usually through a charter.
SECTION 3. The following corporations are considered GOCCs under the conditions
and/or circumstances indicated:
a) A corporation organized under the general corporation law under private
ownership at least a majority of the shares of stock of which were conveyed to
a government financial institution, whether by foreclosure or otherwise, or a
subsidiary corporation of a government corporation organized exclusively to
own and manage, or lease, or operate specific assets acquired by a government
financial institution in satisfaction of debts incurred therewith, and which in
any case by enunciated policy of the government is required to be disposed of
to private ownership within a specified period of time, shall not be considered
a GOCC before such disposition and even if the ownership or control thereof
is subsequently transferred to another GOCC;
b) A corporation created by special law which is explicitly intended under that
law for ultimate transfer to private ownership under certain specified conditions
shall be considered a GOCC, until it is transferred to private ownership;
c) A corporation that is authorized to be established by special law, but which
is still required under that law to register with the Securities and Exchange
Commission in order to acquire a juridical personality, shall not, on the basis
of the special law alone, be considered a GOCC.
SECTION 4. The terms parent corporation, subsidiary and/or affiliate shall have
the following meanings and legal signification:
a) A parent corporation is one which is created by special law;
b) A subsidiary corporation is one organized under the general corporation
law (1) under private ownership at least a majority of the shares of stock of
which were conveyed to a government corporation in satisfaction of debts
incurred with a government financial institution, whether by foreclosure or
Laws on Bases Conversion

210

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Executive Order No. 596

otherwise, or (2) as a subsidiary corporation of a government corporation


organized exclusively to own and manage, or lease, or operate specific
physical assets acquired by the government financial institution in satisfaction
of debts incurred therewith, and which in any case by enunciated policy of
the government is required to be disposed of to private ownership within a
specified period of time;
c) An affiliate corporation is one where total government ownership comprises
less than the majority of its outstanding capital stock and its outstanding voting
capital stock.
SECTION 5. All executive issuances, rules and regulations or parts thereof, which are
inconsistent with this Executive Order, are hereby repealed or modified accordingly.
SECTION 6. This Executive Order shall take effect after fifteen (15) days from date of
publication in a national newspaper of general circulation.
DONE in the City of Manila, on this 29th day of December in the year of Our Lord,
Two Thousand and Six.

(Sgd.) GLORIA MACAPAGALARROYO


President of the Philippines
By the President:

(Sgd.) EDUARDO R. ERMITA


Executive Secretary

211

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

Republic Act No. 10149


An Act to Promote Financial Viability and Fiscal Discipline in Government-Owned or
Controlled Corporations and to Strengthen the Role of the State in its Governance
and Management to Make Them Responsive to the Needs of Public Interest and For
Other Purposes
Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:
Chapter I
General Provisions
SECTION 1. Short Title.This Act shall be known as the GOCC Governance Act of
2011.
SECTION 2. Declaration of Policy.The State recognizes the p of government-owned
or controlled corporations (GOCCs) as significant tools for economic development. It
is thus the policy of the State to actively exercise its ownership rights in GOCCs and to
promote growth by insuring that operations are consistent with national development
policies and programs.
Towards this end, the State shall ensure that:
a. The corporate form of organization through which government carries out
activities is utilized judiciously;
b. The operations of GOCCs are rationalized and monitored centrally in order
that government assets and resources are used efficiently and the government
exposure to all forms of liabilities including subsidies is warranted and incurred
through prudent means;
c. The governance of GOCCs is carried out in a transparent, responsible and
accountable manner and with the utmost degree of professionalism and
effectiveness;
d. A reporting and evaluation system, which will require the periodic disclosure
and examination of the operations and management of the GOCCs, their assets
and finances, revenues and expenditures, is enforced;
e. The government boards of every GOCC and its subsidiaries are competent to
carry out its functions, fully accountable to the State as its fiduciary, and acts
in the best interest of the State;

Laws on Bases Conversion

212

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

f. Reasonable, justifiable and appropriate remuneration schemes are adopted for


the directors/trustees, officers and employees of GOCCs and their subsidiaries
to prevent or deter the granting of unconscionable and excessive remuneration
packages; and
g. There is a clear separation between the regulatory and proprietary activities
of GOCCs, in order to achieve a level playing field with corporations in the
private sector performing similar commercial activities for the public.
SECTION 3. Definition of Terms.
a. Affiliate refers to a corporation fifty percent (50%) or less of the outstanding
capital stock of which is owned or controlled, directly or indirectly, by the
GOCC.
b. Appointive Director refers to:
1. In the case of chartered GOCCs, all members of its Board of Directors/
Trustees who are not ex officio members thereof;
2. In the case of nonchartered GOCCs, members of the Board of Directors/
Trustees whom the State is entitled to nominate, to the extent of its
percentage shareholdings in such GOCC; and
3. In the case of subsidiaries and affiliates, members of the Board of Directors/
Trustees whom the GOCC is entitled to nominate to the extent of its
percentage shareholdings in such subsidiary or affiliate.
c. Board of Directors/Trustees or Board refers to the governing body that exercises
the corporate powers of a GOCC.
d. Breakthrough Results refer to the achievement of corporate goals or other
performance indicators as determined by the GOCC or its supervising
department.
e. Chapter Statement refers to a statement of the GOCCs vision, mission and
core values.
f. Chartered GOCC refers to a GOCC, including Government Financial
Institutions, created and vested with functions by a special law.
g. Chief Executive Officer (CEO) refers to the highest ranking corporate
executive, who could be the President or the General Manager, Chairman or
the Administrator of a GOCC.

213

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

h. Department refers to an executive department created by law. This shall include


any instrumentality having or assigned the rank of a department, regardless of
its name or designation.
i. Ex Officio Board Member refers to any individual who sits or acts as a member
of the Board of Directors/Trustees by virtue of ones title to another office, and
without further warrant or appointment.
j. Fit and Proper Rule refers to the standard for determining whether a member
of the Board of Directors/Trustees or CEO is fit and proper to hold a position
in a GOCC which shall include, but not limited to, standards on integrity,
experience, education, training and competence.
k. Government Agency refers to any of the various units of the Government
of the Republic of the Philippines, including a department, bureau, office,
instrumentality or GOCC, or a local government or a district unit therein.
l. Government Corporate Governance Standards refer to a set of principles derived
from law and practices, rules and standards prescribed by the Governance
Commission for Government-Owned or Controlled Corporations (GCG) that
generate long-term and desirable economic value for the State. It shall also
refer to a system whereby shareholders, creditors, and othe stakeholders of a
corporation ensure that management enhances the value of the corporation as
it competes in an increasingly global market place.
m. Government Financial Institutions (GFIs) refer to financial institutions or
corporations in which the government directly or indirectly owns majority of
the capital stock and which are either: (1) registered with or directly supervised
by the Bangko Sentral ng Pilipinas; or (2) collecting or transacting funds or
contributions from the public and places them in financial instruments or
assets such as deposits, loans, bonds, and equity including, but not limited
to, the Government Service Insurance System and the Social Security System.
n. Government Instrumentalities with corporate Powers (GICP)/Government
Corporate Entities (GCE) refer to instrumentalities or agencies of the government,
which are neither corporations nor agencies integrated within te departmental
framework, but vested by law with special functions or jurisdiction, endowed
with some if not all corporate powers, administering special funds, and enjoying
operational autonomy usually through a charter including, but not limited to,
the following: the Manila International Airport Authority (MIAA), the Philippine
Ports Authority (PPA), the Philippine Deposit insurance Corporation (PDIC),
the metropolitan Waterworks and Sewerage System (MWSS), the Laguna
Lake Development Authority (LLDA), the Philippine Fisheries Development
authority (PFDA), the Bases Conversion and development Authority (BCDA),

Laws on Bases Conversion

214

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

the Cebu Port Authority (CPA), the Cagayan de Oro Port Authority, the San
Fernando Port Authority, the Local Water Utilities Administration (LWUA) and
the Asian Productivity Organization (APO).
o. Government-Owned or Controlled Corporation (GOCC) refers to any agency
organized as a stock or nonstock corporation, vested with functions relating
to public needs whether governmental or proprietary in nature, and owned
by the Government of the Republic of the Philippines directly or indirectly or
through its instrumentalities either wholly or, where applicable as in the case of
stock corporations, to the extent of at least a majority of its outstanding capital
stock: Provided, however, That for purposes of this Act, the term GOCC shall
include GICP/GCE and GFI as defined herein.
p. Nonchartered GOCC refer to a GOCC organized and operating under Batas
Pambansa Bilang 68, or The Corporation code of the Philippine.
q. Officers refer to the corporate officers of the GOCC as provided in its charter
or bylaws, such as the CEO, Chief Finance Officer, Chief Investment Officer,
President, Vice President, General Manager, Treasurer and Corporate Secretary.
r. Ownership Manuals refer to guidelines and rules pertaining to the ownership
by the State or corporations and enterprises or the exercise of such ownership
governing the GOCCs or any classification thereof.
s. Per Diems refer to the compensation granted to members of the Board of
Directors or Trustees of a GOCC for actual attendance in meetings.
t. Performance Evaluation System refers to the process of appraising the
accomplishments of GOCCs in a given fiscal year based on set performance
criteria, targets and weights.
u. Performance Scorecard refers to a governance and management tool forming
part of the performance evaluation system which consists of a set of measures,
targets and initiatives that facilitate the achievement of breakthrough results and
performance through the effective and efficient monitoring and coordination
of the strategic objectives of the GOCC.
v. President refers to the President of the Republic of the Philippines.
w. Related Corporation refers to a subsidiary or affiliate of a GOCC.
x. Secretary refers to the person vested with the authority and responsibility for
the exercise of the mandate of the Department, for the discharge of its powers

215

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

and functions, and who shall have supervision and control of the Department.
y. Strategy Map refers to an integrated set of strategic choices or objectives
drawn by the governing body, the successful execution of which results in
the achievement of the GOCCs vision in relation to its mission or purpose for
having been created.
z. Subsidiary refers to a corporation where at least a majority of the outstanding
capital stock is owned or controlled, directly or indirectly, through one or more
intermediaries, by the OGCC.
SECTION 4. Coverage.The Act shall be applicable to all GOCCs, GICPs/GCEs,
and government financial institutions, including their subsidiaries, but excluding
the Bangko Sentral ng Pilipinas, state universities and colleges, cooperatives, local
water districts, economic zone authorities and research institutions, the President shall
appoint one-third (1/3) of the board members from the list submitted by the GCG.
Chapter II
The Covernance Commission for Government-Owned or Controlled Corporations (GCG)
SECTION 5. Creation of the Governance Commission for Government-Owned or
Controlled Corporations.There is hereby created a central advisory, monitoring, and
oversight body with authority to formulate, implement and coordinate policies to be
known as the Governance Commission for G Government-Owned or Controlled
Corporations, hereinafter referred to as the GCG, which shall be attached to the Office
of the President. The GCG shall have the following powers and functions:
a. Evaluate the performance and determine the relevance of the GOCC, to
ascertain whether such GOCC should be reorganized, merged, streamlined,
abolished or privatized, in consultation with the department or agency to
which a GOCC is attached. For this purpose, the GCG shall be guided by any
of the following standards:
1. The functions or purposes for which the GOCC was created are no longer
relevant to the State or no longer consistent with the national development
policy of the State;
2. The GOCCs functions or purposes duplicate or unnecessarily overlap
with functions, programs, activities or projects already provided by a
Government Agency;
3. The GOCC is not producing the desired outcomes, or no longer achieving
the objectives and purposes for which it was originally designed and

Laws on Bases Conversion

216

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

implemented, and/or not cost efficient and does not generate the level of
social, physical and economic returns vis--vis the resource inputs;
4. The GOCC is in fact dormant or non-operational;
5. The GOCC is involved in an activity best carried out by the private sector;
and
6. The functions, purpose or nature of operations of any group of GOCCs
require consolidation under s holding company.
Upon determination by the GCG hat it is to the best interest of the State that a GOCC
should be reorganized, merged, streamlined, abolished or privatized, it shall:
i. Implement the reorganization, merger, streamlining of the GOCC, unless
otherwise directed by the President; or
ii. Recommend to the President the abolition or privatization of the GOCC,
and upon the approval of the President, implement such abolition or
privatization, unless the President designates another agency to implement
such abolition or privatization.
b. Classify GOCCs into (1) Developmental/Social Corporations; (2) Proprietary
Commercial Corporations; (3) Government Financial, Investment and trust
Institutions; (4) Corporations with Regulatory Functions; and (5) Others as
may be classified by the GCG, without prejudice to further subclassifications
in each category and/or any other classification based on parameters as it
may find relevant or materials such as, but not limited to, industry type. The
classification shall guide the GCG in exercising its powers and functions as
provided herein;
c. In consultation with the relevant government agencies and stakeholders, adopt
within one hundred eighty (180) days from its constitution, an ownership and
operations manual and the government corporate standards governing GOCCs:
Provided, That the government corporate governance standards applicable to
GOCCs shall be no less rigorous than those required by the Philippines Stock
Exchange or the Securities and Exchange Commission of listed companies, or
those required by the Bangko Sentral ng Pilipinas or the Insurance Commission
for banking institutions and insurance companies, as the case may be. The
manual shall be consistent with the Medium-term Philippine Development
Plan issued by the National Economic and Development Authority (NEDA)
and shall include:

217

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

1.
2.
3.
4.

Objectives of State ownership;


Role of national government in the governance of GOCCs;
Modes of implementation of the ownership policy;
Guidelines on the monitoring of the operations of all GOCCs including
their Related Corporations. These shall include Strategy Maps, Charter
Statements, Performance Commitments and such other mechanisms;
5. The roles, relationships and responsibilities of the State, the Government
Agencies to which the GOCC is attached, and the GOCC;
6. Disclosure and transparency requirements;
7. Code of Ethics of directors and Officers;
8. Creation of board committees and similar oversight bodies;
9. Integrated corporate reporting system;
10. Statement of the social responsibilities of the GOCC; and
11. Such other matters as the GCG may deem proper to include in the
ownership policy.
d. Without prejudice to the filing of administrative and criminal charges,
recommend to the Board of Directors or Trustees the suspension of any member
of the Board of Directors or Trustees who participated by commission or
omission in the approval of the act giving rise to the violation or noncompliance
with the ownership manual for a period depending on the nature and extent
of damage caused, during which period the director or trustee shall not be
entitled to any emolument;
e. In addition to the qualifications required under the individual charter of the
GOCCs and in the bylaws of GOCCs without original charters, the GCG shall
identify necessary skills and qualifications required for Appointive Directors
and recommend to the President a shortlist of suitable and qualified candidates
for Appointive Directors;
f. Establish the performance evaluation systems including performance
scorecards which shall apply to all GOCCs in general and to the various
GOCC classification;
g. Conduct periodic study, examination, evaluation and assessment of the
performance of the GOCCs, receive, and in appropriate cases, require reports
on the operations and management of the GOCCs including, but not limited
to, the management of the assets and finances of the GOCCs;
h. Conduct compensation studies, develop and recommend to the president a
competitive compensation and remuneration system which shall attract and
retain talent, at the same time allowing the GOCC to be financially sound and
sustainable;

Laws on Bases Conversion

218

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

i. Provide technical advice and assistance to the government agencies to which


the GOCCs are attached in setting performance objectives and targets for
the GOCCs and in monitoring GOCCs performance vis--vis established
objectives and targets;
j. Coordinate and monitor the operations of GOCCs, ensuring alignment and
consistency with the national development policies and programs. It shall
meet at least quarterly to:
1. Review Strategy Maps and Performance Scorecards of all GOCCs;
2. Review and assess existing performance-related policies including the
compensation/remuneration of the Board of Directors/Trustees and Officers
and recommend appropriate revisions and actions; and
3. Prepare performance reports of the GOCCs for submission to the President.
k. Prepare a semi-annual progress report to be submitted to the President and the
Congress. In its report, the GCG will provide its performance assessment of
the GOCCs and recommend clear and specific actions. Within one hundred
twenty (120) days from the close of the year, the GCG shall prepare an annual
report on the performance of the GOCCs and submit it to the President and
the Congress; and
l. Review the functions of each of the GOCC and, upon determination that there
is a conflict between the regulatory and commercial functions of a GOCC,
recommend to the President in consultation with the Government Agency to
which such GOCC is attached, the privatization of the GOCCs commercial
operations, or the transfer of the regulatory functions to the appropriate
government agency, or such other plan of action to ensure that the commercial
functions of the GOCC do not conflict with such regulatory functions.
In the performance of its functions under subsections (a), (c), (e), (f), (g), (h) and (l)
herein and in any other review or evaluation of a GOCC that the GCG may conduct,
the GCG shall engage the participation of the Secretary or highest ranking official of
the relevant agency or department, as the case may be.
SECTION 6. Composition of the GCG.The GCG shall be composed of five (5)
members. The Chairman with the rank of Cabinet Secretary and two (2) members with
the rank of Undersecretary shall be appointed by the President. The Secretaries of the
Department of Budget and Management and the Department of Finance shall sit as ex
officio members.
SECTION 7. Powers and Functions of the Chairman.The management of the GCG
shall be vested in the Chairman who shall have the following powers and duties:

219

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

a. Preside over the meetings of the GCG;


b. Direct and manage the day-to-day affairs and business of the GCG;
c. With the approval of the GCG, determine the staffing pattern and the number
of personnel of the GCG and define their duties and responsibilities;
d. With the approval of the GCG, to appoint, remove, suspend, or otherwise
discipline for cause, any employee of the GCG; and
e. Perform such other duties as may be delegated or assigned to him by the GCG
from time to time.
Chapter III
Compensation

and

Positin Classification System

for

GOCCs

SECTION 8. Coverage of the Compensation and Position Classification System.The


GCG, after conducting and Position Classification System which shall apply to all
officers and employees of the GOCCs whether under the Salary Standardization Law or
exempt therefrom and shall consist of classes of positions grouped into such categories
as the GCG may determine, subject to the approval of the President.
SECTION 9. Position Titles and Salary Grades.All positions in the Position
Classification System, as determined by the GCG and as approved by the President,
shall be allocated to their prope position titles and salary grades in accordance with an
Index of Occupational Services, Position Titles and Slary Grades of the Compensation
and Position Classification System, which shall be prepared by the GCG and approved
by the President.
The following principles shall govern the Compensation and Position Classification
System:
a. All GOCC personnel shall be paid just and equitable wages in accordance
with the principle of equal pay for work of equal value. Differences in pay
shall be based on verifiable Compensation and Position Classification factors
in due regard to the financial capability of the GOCCs.
b. Basic compensation for all personnel in the GOCC shall generally be
comparable with those in the private sector doing comparable work, and
must be in accordance with prevailing laws on minimum wages. The total
compensation provide for GOCC personnel shall be maintained at a reasonable

Laws on Bases Conversion

220

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

level with due regard to the provisions of existing compensation and position
classification laws including Joint Resolution No. 4, Series of 2009, and te
GOCCs operating budget; and
c. A review of the GOCC compensation rates, taking into account the performance
of the GOCC, its overall contribution to the national economy and the possible
erosion in purchasing power due to inflation and other factors, shall be
conducted periodically.
Any law to the contrary notwithstanding, no GOCC shall be exempt from the covering
of the Compensation and Position Classification System developed by the GCG under
this Act.
SECTION 10. Additional Incentives.The GCG may recommend to the President,
incentives for certain position titles in consideration of the good performance of the
GOCC: Provided, That no incentives shall be granted unless the GOCC has fully paid
all taxes for which it is liable, and the GOCC has declared and paid all the dividends
required to be paid under its charter or any other laws.
SECTION 11. Non-diminution of Salaries.The Compensation and Position
Classification System to be developed and recommended by the GCG and as approved
by the President shall apply to all positions, on full or part-time basis, now existing or
hereafter created in the GOCC: Provided, That in no case shall there be any diminution
in the authorized salaries as of December 31, 2010 of incumbent employees of
GOCCs, including those exempt under Republic Act No. 6758, as amended, upon the
implementation of the Compensation and Position Classification System for GOCCs.
Chapter IV
Board of Directors/Trustees/Officers
Controlled Corporations

of

Government-Owned

or-

SECTION 12. Coverage.The duties, obligations, responsibilities and standards of


care provided under this Chapter sall be applicable to all members of the Board of
Directors/Trustees and Officers of GOCCs and subsidiaries now existing or hereafter
created including government appointed directors in affiliate corporations. These
duties, obligation and responsibilities shall be in addition to the powers and functions
provided in the individual charters or articles of incorporation and bylaws of the
respective GOCCs.
SECTION 13. Number of Directors/Trustees.The present number of Director/Trustees
provided in the charter of the GOCCs shall be maintained.
SECTION 14. Ex Officio Alternates.The ex officio members of the GOCC may
designate their respective alternates who shall be the officials next-in-rank to them,
and whose acts shall be considered the acts of their principals.

221

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

SECTION 15.Appointment of the Board of Directors/Trustees of GOCCs.An


Appointive Director shall be appointed by the President of the Philippines from a
shortlist prepared by the GCG.
The GCG shall formulate its rules and criteria in the selection and nomination of
prospective appointees and shall cause the creation of search committees to achieve
the same. All nominees included in the list submitted by the GCG to the President shall
meet the Fit and Proper Rule as defined under this Act and such other qualifications
which the GCG may determine taing into consideration the unique requirements
of each GOCC The GCG shall ensure that the shortlist shall exceed by at least fifty
percent 50%) of the number of directors/trustees to be appointed. In the event that the
President does not see fit to appoint any of the nominees included in the shortlist, the
President shall ask the GCG to submit additional nominees.
SECTION 16. Fit and Proper.All members of the Board, the CEO and other officers
of the GOCCs including appointive directors in subsidiaries and affiliate corporations
shall be qualified by the Fit and Proper Rule to be determined by the GCG in
consultation and coordination with the relevant government agencies to which the
GOCC is attached and approved by the President.
To maintain the quality of management of the GOCCs, the GCG, in coordination
with the relevant government agencies shall, subject to the approval of the President,
prescribe, pass upon and review the qualifications and disqualifications of individuals
appointed as officers, directors or elected CEO of the GOCC and shall disqualify those
found unfit.
In determination whether an individual is fit and proper to hold the position of an
officer, director or CEO of the GOCC, due regard shall be given to ones integrity,
experience, education, training and competence.
SECTION 17. Term of Office.Any provision in the charters of each GOCC to the
contrary notwithstanding, the term of office of each Appointive Director shall be for
one (1) year, unless sooner removed for cause: Provided, however, That the Appointive
Director shall continue to hold office until the successor is appointed. An Appointive
Director may be nominated by the GCG for reappointment by the President only if
one obtains a performance score of above average or its equivalent or higher in the
immediately preceding year of tenure as Appointive Director based on the performance
criteria for Appointive Directors for the GOCC.
Appointment to any vacancy shall only for the unexpired term of the predecessor. The
appointment of a director to fill such vacancy shall be in accordance with the manner
provided in Section 15 of this Act.

Laws on Bases Conversion

222

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

Any provision of law to the contrary notwithstanding, all incumbent CEOs and
appointive members of the Board of GOCCs shall, upon approval of this Act, have a
term of office until June 30, 2011, unless sooner replaced by the President: Provided,
however, That the incumbent CEOs and appointive members of the Board shall
continue in office until the successors have been appointed by the President.
SECTION 18. The Chief Executive Officer of the GOCC.The CEO of the highestranking officer provided in the charters of the GOCCs, shall be elected annually by
the members of the Board from among its ranks. The CEO shall be subject to the
disciplinary powers of the Board and may be removed by the Board for cause.
SECTION 19. Fiduciary Duties of the Board and Officers.As fiduciaries of the State,
members of the Board of Directors/Trustees and the Officers of GOCCs have the legal
obligation and duty to always act in the best interest of the GOCC, with utmost good
faith in all its dealings with the property and monies of the GOCC.
The members of the Board and Officers of GOCCs shall:
a. Act with utmost and undivided loyalty to the GOCC;
b. Act with due care, extraordinary diligence, skill and good faith in the conduct
of the business of the GOCC;
c. Avoid conflicts of interest and declare any interest they may have in any
particular matter before the Board;
d. Apply sound business principles to ensure the financial soundness of the
GOCC; and
e. Elect and/or employ only Officers who are fit and proper to hold such office
with due regard to the qualifications, competence, experience and integrity.
Where a member of the Board or an Officer, by virtue of the office, acquires or receives
for oneself a benefit or profit, of whatever kind or nature including, but not limited to,
the acquisition of shares in corporations where the GOCC has an interest, using the
properties of the GOCC for their own benefit, receiving commissions on contracts from
the GOCCs assets, or taking advantage of corporate opportunities of the GOCC, all
such profits or benefits shall be subject to restitution under Section 24 of this Act, without
prejudice to any administrative, civil or criminal action against members of the Board
of Directors/Trustees or Officers. This provision shall be applicable notwithstanding the
fact that such member of the Board or Officer risked ones own funds in the venture.
SECTION 20. Trustee Relation to the Properties, Interests and Monies of the GOCC.
Except for the per diem received for actual attendance in board meetings and the
reimbursement for actual and reasonable expenses and incentives as authorized by
the GCG, any and all realized and unrealized profits and/or benefits including, but not

223

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

limited to, the share in the profits, incentives of members of the Board or Officers in
excess of that authorized by the GCG, stock options, dividends and other similar offers
or grants from corporations where the GOCC is a stockholder or investor, and any
benefit from the performance of members of the Board or Officers of the Corporation
acting for and in behalf of the GOCC in dealing with its properties, investments in
other corporations, management of subsidiaries and other interest, are to be held in
trust by such member of the Board or Officer for the exclusive benefit of the GOCC
represented.
SECTION 21. Care, Diligence and Skill in the Conduct of the Business of the GOCC.
The members of the Board and the Officers must exercise extraordinary diligence in
the conduct of the business and in dealing with the properties of the GOCC. Such
degree of diligence requires using the utmost diligence of very cautious person with
due regard for all the circumstances.
SECTION 22. Power of the Board of Directors/Trustees to Discipline, Remove Officers
of GOCC.Subject to existing civil service laws, rules and regulations, the Board shall
have authority to discipline the CEO, or order the removal fro office, upon a majority
vote of the members of the Board who actually took part in the investigation and
deliberation.
SECTION 23. Limits to Compensation, Per Diems, Allowances and Incentives.The
charters of each of the GOCCs to the contrary notwithstanding, the compensation, per
diems, allowances and incentives of the members of the Board of directors/Trustees
of the GOCCs shall be determined by the GCG using as a reference, among others,
Executive Order No. 24 dated February 10, 2011: Provided, however, That Directors/
trustees shall not be entitled to retirement benefits as such directors/trustees.
In case of GOCCs organized solely for the promotion of social welfare and the common
good without regard to profit, the total yearly per diems and incentives in the aggregate
which the members of the Board of such GOCCs may receive shall be determined by
the President upon the recommendation of the GCG based on the achievement by
such GOCC of its performance targets.
SECTION 24. Restitution.Upon the determination and report of the Commission on
Audit (COA) that properties or monies belonging to the GOCC are in the possession
of a member of the Board or Officer without authority, or that profits are earned by
the member of the Board or Officer in violation of the fiduciary duty, or the aggregate
per diems, allowances and incentives received in a particular year are in excess of
the limits provided under this Act, the member of the Board or Officer receiving such
properties or monies shall return the same to the GOCC.
Failure to make the restitution within thirty (30) days after a written demand has been
served shall, after trial and final judgement, be punished by an imprisonment of one (1)
year and a fine equivalent to twice the amount to be restituted, and in the direction of
the court of competent jurisdiction, disqualification to hold public office.
Laws on Bases Conversion

224

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

Chapter V
Disclosure Requirements
SECTION 35. Full Disclosure.All GOCCs shall maintain a website and post therein
for unrestricted public access:
a. Their latest annual audited financial and performance report within thirty (30)
days from receipt of such report;
b. Audited financial statements in the immediate past five (5) years;
c. Quarterly, annual reports and trial balance;
d. Current corporate operating budget;
e. Complete compensation package of all the board members and officers,
including travel, representation, transportation and any other form of expenses
or allowances;
f. Local and foreign borrowings;
g. Performance scorecards and strategy maps;
h. Government subsidies and net lending;
i. All borrowings guaranteed by the government; and
j. Such other information or report the GCC may require.
SECTION 26. Special Audit.
a. The thirty (30) GOCCs with the highest total assets shall be subject to periodic
special audit by the COA. The periodic audit shall, at the minimum make a
determination whether:
1. The accounting records of the GOCCs are complete and in accordance
with generally accepted accounting practices and standards; and
2. The statements prepared from the accounts present fairly and
comprehensively their GOCCs financial position and the results of its
financial operations.
b. As may be necessary or convenient in the performance by the GCG of its
functions, the Chairman of the GCG may direct at any time a special OA audit
of any other GOCC for any specific purpose or when authorized by law, direct
an audit by independent auditors.

225

Laws on Bases Conversion

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

Chapter VI
Creation and Acquisition

of a

GOCC

or

Related Corporation

SECTION 27. Requisition for the Creation of a New GOCC or related Corporation
under The Corporation Code.A government agency seeking to establish a GOCC or
related Corporation under The Corporation Code of the Philippines shall submit its
proposal to the GCG for review and recommendation to the President for approval
before registering the same with the Securities and exchange Commission (SEC). The
SEC shall not register the articles of incorporation and bylaws of a proposed GOCC
or Related Corporation, unless the application for registration is accompanied by an
endorsement from the GCG stating that the President has approved the same.
SECTION 28. Requisites for the Acquisition of Controlling Interest in Another
Corporation.Any government agency seeking to purchase a corporation or acquire
controlling interest therein shall submit its proposal to the GCG for review and approval
of the President.
Chapter VII
Miscellaneous Provisions
SECTION 29. Appropriations.The amount of Ten million pesos (P10,000,000.00)
for the initial operation of the GCG shall be sourced from the Contingent Fund of the
President. Subsequent funding requirements shall be included in the annual General
Appropriations Act.
SECTION 30. Suppletory Application of The Corporation Code and Charters of
the GOCCs.The provisions of The Corporation Code of the Philippines and the
provisions of the charters of the relevant GOCCs, insofar as they are not inconsistent
with the provisions of this Act, shall apply suppletorily to GOCCs.
SECTION 31. Transitory Provision.The privatization Council and the Privatization
and Management Office created under executive Order No. 323, Series of 2000, shall
continue to implement and finish the privatization of GOCCs that have been identified
by the said Privatization Council and approved for privatization by the president prior
to the effectivity of this Act: Provided, however, That the privatization of said GOCCs
that remain unfinished at the end of two (2) years after the effectivity of this Act shall
be automatically transferred to the GCG which shall continue the privatization of the
GOCCs.
SECTION 32. Repealing Clause.The charters of the GOCCs under existing laws and
all other laws, executive orders including Executive Order No. 323, Series of 2000,
administrative orders, rules, regulations, decrees and other issuances or parts thereof
which are inconsistent with the provisions of this Act are hereby revoked, repealed or
modified accordingly.

Laws on Bases Conversion

226

GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS - Republic Act No. 10149

SECTION 33. Separability Clause.Should any provision of this Act be declared


unconstitutional, the same shall not affect the validity of the other provisions of this
Act.
SECTION 34. Effectivity.This Act shall take effect after fifteen 915) days following
its publication in the Official Gazette or in two (2) newspapers of general circulation.
Approved,

(Sgd.) FELICIANO BELMONTE JR.


Speaker of the
House of Representatives

(Sgd.) JUAN PONCE ENRILE


President of the Senate

This Act is a consolidation of Senate Bill No. 2640 and House Bill No. 4067 was finally
passed by the Senate and the House of Representatives on May 30, 2011 and May 31,
2011, respectively.

(Sgd.) MARILYN B. BARUA-YAP


Secretary General
House of Representatives

(Sgd.) EMMA LIRIO-REYES


Secretary of the Senate

Approved: June 6, 2011

(Sgd.) BENIGNO SIMEON C. AQUINO III


President of the Philippines

227

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

NEDA Joint Venture Guidelines and Procedures


Guidelines and Procerdures for Entering into Joint Venture (JV)
Agreements Between Government and Private Entities
1.0 Legal Basis. These Guidelines are being issued pursuant to Section 8 (Joint
Venture Agreements) of Executive Order (EO) No. 423 dated 30 April 2005,
which mandates the National Economic and Development Authority (NEDA),
in consultation with the Government Procurement Policy Board (GPPB), to issue
the necessary guidelines on Joint Ventures (JVs). The Office of the Government
Corporate Counsel (OGCC), Department of Justice (DOJ), GOCCs and the private
sector have also been consulted in the formulation of the Guidelines.
2.0 Principles. The Government shall enter into a JV arrangement consistent with the
following principles:
2.1 The creation of the JV should not prevent potential players from profitably
entering into business venture/market.
2.2 The cost of producing the particular product, activity, or service should be
efficient or potentially efficient towards earning potential profits for government
and the market player/private sector partner.
2.3 There should be no barriers for the governments withdrawal of its contribution
to the JV investment.
2.4 The role of government as regulator of the business of the JV should be clearly
and explicitly delineated from its role as implementer of the business to avoid
conflicts of interest.
2.5 As differentiated from projects procured under Official Development
Assistance (ODA), Build Operate and Transfer Law (BOT) and Government
Procurement Reform Act (GPRA) where ownership of the asset/business will
stay with the government, JV Agreements allow the private sector to take over
the undertaking of the projects in its entirety after the government divests itself
of any interest in the JV.
2.6 Accountability for the JV project ultimately devolves on the Head of the
Government Entity involved in the JV Agreements and the implementation of
the JV project. The private parties dealing with the Government are similarly
held accountable for all their actions relative thereto.
3.0 Purpose. These Guidelines are being formulated to meet the following objectives:

Laws on Bases Conversion

228

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

3.1 To prescribe the rules, guidelines and procedures forging JV Agreements


between government corporations as defined under section 4.0 below, and
private entities;
3.2 To encourage pooling of resources and expertise between government and
private sector entities through JVs as a viable, efficient, and practical alternative
in pursuing development goals of the government; and
3.3 To ensure that all JV Agreements are entered into under the policy that all
government contracts shall be awarded through a transparent process.
4.0 Coverage.
4.1 These guidelines shall apply to all government-owned and/or controlled
corporations (GOCCs), government corporate entities (GCEs), government
instrumentalities with corporate powers (GICPs), government financial
institutions (GFIs), state universities and colleges (SUCs), as defined under
Section 5.0 and which are expressly authorized by law or their respective
charters to enter into JV Agreements. Local Government Units (LGUs) are not
covered by these Guidelines.
4.2 Transactions of GFIs in the ordinary course of business as part of their normal
and ordinary banking, financial or portfolio management operations shall not
be covered by the provisions of these Guidelines.
5.0 Definition of Terms.
5.1 Government Entity. Refers to GOCCs, GCEs, GICPs, SUCs, and GFIs, created
by law, executive issuances and by the Corporation Code, among others.
5.2 Government Corporate Entity (GCE) and Government Instrumentality with
Corporate Powers (GICP). Refer to entities exercising both government and
corporate powers, but which do not fall under the definition of a GOCC under
the Administrative Code.
5.3 Head of Government Entity. Refers to the governing board or its duly authorized
official, for GOCCs, GCEs, GICPs, SUCs, and GFIs.
5.4 Joint Venture (JV). A contractual arrangement whereby a private sector entity
or a group of private sector entities on one hand, and a Government Entity or
a group of Government Entities on the other hand, contribute money/capital,
services, assets (including equipment, land or intellectual property), or a

229

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

combination of any or all of the foregoing. Parties to a JV share risks to jointly


undertake an investment activity in order to accomplish a specific, limited or
special goal or purpose with the end view of facilitating private sector initiative
in a particular industry or sector, and eventually transferring ownership of the
investment activity to the private sector under competitive market conditions.
It involves a community or pooling of interests in the performance of the
service, function, business or activity, with each party having a right to direct
and govern the policy in connection therewith, and with a view of sharing
both profits and losses, subject to agreement by the parties. A JV may be a
contractual JV, or a corporate JV.
5.5 JV Company. An entity registered with the Securities and Exchange Commission
(SEC) by the JV partners that shall perform the primary functions and obligations
of the JV as stipulated under the JV Agreement. The JV Company shall possess
the characteristics stipulated under these Guidelines.
5.6 Contractual JV. A legal and binding agreement under which the JV partners
shall perform the primary functions and obligations under the JV Agreement
without forming a JV Company.
5.7 Competitive Selection. Refers to a process of selection by a Government Entity
of a JV partner(s), based on transparent criteria, which should not constrain or
limit competition, and is open to participation by any interested and qualified
private entity.
5.8 Competitive Challenge. An alternative selection process wherein third parties
shall be invited to submit comparative proposals to an unsolicited proposal.
Accordingly, the private sector entity that submitted the unsolicited proposal is
accorded the right to match any superior offers given by a comparative private
sector participant.
5.9 Negotiated Projects. Refers to instances where the desired project is the result
of an unsolicited proposal from a private sector proponent or, if the government
has failed to identify an eligible private sector partner for a desired activity after
subjecting the same to a competitive selection.
5.10 Unsolicited Proposal. Refer to project proposals submitted by the private
sector to undertake Infrastructure or Development Projects without a formal
solicitation issued by a Government Entity. These projects may be entered into
by the Government Entity on a negotiated basis, provided, however, that there
shall be no direct government guarantees for JVs resulting from an unsolicited
proposal.

Laws on Bases Conversion

230

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

6.0 General Guidelines.


6.1 JV Agreements entered into shall consider the following parameters:
a. Investments or JV Agreements must be made only in activities directly
and immediately related to and in furtherance of the primary corporate
purpose, mandate, or charter of the investing Government Entity;
b. The JV should be clear in its intent to undertake a specific activity that is
responsive to national development goals and objectives; and
c. The JV should not tend to crowd out private sector initiative in a particular
industry or sector. The DTI, BOI and NEDA shall issue a negative list of
industries or sectors on a periodic basis where the formation of a JV is
likely to crowd out private sector initiative.
6.2 The preferred mode of implementing a JV Agreement shall be through a JV
Company to be formed by the Government Entity and the private sector entity,
under the following parameters:
a. The JV Company shall be registered as a stock corporation in accordance
with the provisions of the Corporation Code, as amended, and the
prevailing and applicable rules and regulations promulgated by the SEC;
b. Ownership and nationality requirements under the Constitution and other
pertinent laws should be complied with; provided, that the Government
Entitys equity contribution in the JV Company shall only be less than fifty
percent (50%) of the outstanding capital stock of the latter. Governments
contribution may be through assets (including money, equipment, land,
intellectual property or any thing of value) which shall be subject to a
3rd party independent valuation. For as long as the Government Entity
is involved in the JV undertaking, the private sector party shall not sell/
transfer its interest in the JV Company without the express written consent
of the Government Entity;
c. The Government Entity shall be represented in the Board of the JV Company
in proportion to its investment;
d. The JV Company shall be permitted to derive income from the activities
authorized under the JV Agreement thereof during the term thereof. The
Government Entity and the private sector partner shall be entitled to receive
dividends and/or any other form of share from net profits earned by the JV
Company in accordance with the JV Agreement. The determination of net
profits shall be subject to a verification process for allowable operations
and management expenses specified therein;

231

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

e. The JV Company is encouraged to stipulate a fixed period for the


participation of the Government Entity. This period shall be determined
by the attainment of the Government Entitys objective in pursuing the
investment, or when the private sector partner is projected to be able to
proceed with the JV activity without further need of government support.
Further, the withdrawal of the Government Entitys capital contribution
before the expiration of the said period is likewise encouraged; provided,
that the divestment is made through competitive selection, initial public
offering (IPO), or any other means that promote competition, fairness and
transparency. The foregoing factors shall be accorded greater importance
than the financial impact or financial benefit of the proposed investment
to the Government Entity concerned.
f. In drafting the incorporation documents of the JV Company and other
contracts governing the relationship between the Government Entity and
the private sector participant, the parties should consider the following
guidelines: (1) clearly defined business objectives; (2) specified degree of
participation and the management roles of each party in the JV Activity;
(3) defined contribution of capital and ownership rights to property; (4)
specified division of the profits and losses; (5) identified dispute mechanism
to avoid management impasses that may produce deadlock or litigation;
(6) specified termination/liquidation of the JV Company and indicate
buy-out provisions; (7) specified confidentiality terms; and (8) stipulated
indemnification mechanisms.
6.3 If the formation of a JV Company is not the best mode to implement a JV
Activity as determined by the Government Entity, it may opt to implement the
JV project through a contractual agreement. Prior to entering into a Contractual
JV, the parameters similar to those governing JV Companies under Section 6.2
(f) herein are to be observed.
7.0 Process for Entering into JV Agreements. Prior to entering into a JV Agreement,
the proposed JV activity shall be approved in principle, in accordance with the
procedure stipulated below:
7.1 Approval in Principle by the Head of a Government Entity. For JV Agreements
regardless of cost, the Head of the Government Entity concerned shall have
the authority to approve the proposed JV Agreement in principle, subject to the
compliance to the conditions listed hereunder:
a. Justification that the JV activity is within the mandate and charter of the
Government Entity concerned as certified and notarized by the head of the
Government Entity;

Laws on Bases Conversion

232

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

b. Clear description of the proposed investment, including its activities,


objectives, source(s) of funding, extent and nature of the proposed
participation of the investing Government Entity, period of participation
of the Government Entity, and the relevant terms and conditions of the
undertaking under the proposed JV Agreement, among others;
c. Justification as to the responsiveness and relative priority of the proposed JV
activity in meeting national or specific development goals and objectives;
and
d. All other components of the JV Agreement, including the technical,
financial, legal and other aspects in determining the over-all feasibility of
the proposed JV activity, among others, shall be established.
7.2 For JV activity that will require national government undertakings, subsidies
or guarantees, clearance/approval of the Department of Finance (DOF) and/or
the Department of Budget and Management (DBM), as the case may be, shall
be secured.
7.3 Modes of Selecting a JV Partner
a. Competitive Selection The process for the conduct of Competitive
Selection, contract award and final approval shall be stipulated under
Annex A of these guidelines. In the conduct of the Competitive Selection
process, the Government Entity shall ensure the following:
i. all activities during the competitive selection, award, and final approval
are conducted in a transparent and competitive process that promotes
accountability and efficiency; and
ii. the competitive selection parameters are clearly defined and shall
include the parameters as approved by the Head of the Government
Entity.
b. Negotiated Agreements Negotiated agreements may be entered under
the following circumstances:
i. When a Government Entity receives an unsolicited proposal;
ii. When there is failure of competition when no proposals are received
or no private sector participant is found qualified and the Government
Entity decides to seek out a JV partner; and

233

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

iii. When there is failure of competition, i.e., there is only a single interested
party remaining as defined under VIII(6) of Annex A.
In the case of subsection b(iii) above, the procedures outlined in Annex B
(Limited Negotiation Procedures in case of Failed Competitive Selection under
Section 6 of Annex A of the Guidelines) shall apply. Subsections b(i) and
b(ii) shall be governed by the rules under Annex C (Detailed Guidelines for
Competitive Challenge Type Procedure Public-Private Joint Ventures).
7.4 Deviations and Amendments to the JV Agreement. The concerned Government
Entity shall not proceed with the award and signing of the contract if there are
material deviations from the parameters and terms and conditions set forth in
the proposal/tender documents that tend to increase the financial exposure,
liabilities, and risks of government or any other factors that would cause
disadvantage to government and any deviation that will cause prejudice to
losing private sector participants. Said material deviations and amendments
shall be subjected to the approval requirements under Sections 7.1 and 7.2
hereof. The Head of the Government Entity concerned shall be responsible for
compliance with this policy. Violation of this provision shall render the award
and/or the signed JV Agreement invalid.
Any amendment to a JV Agreement after award and signing of contract, which
does not materially affect the substance of the competitive selection, shall be
subjected to the requirements stipulated under Sections 7.1 and 7.2 hereof.
Noncompliance with the corresponding approval process stated shall render
the amendment null and void.
8.0 Reporting Requirement. During the course of implementation of the JV
Agreement, the concerned Government Entity shall submit an annual report on the
status of its implementation during a current year to the Department of Finance, for
monitoring purposes. The annual report shall be submitted within the first quarter
of the succeeding year. The report shall use current standards in the production of
corporate annual reports and shall include the audited financial statements of the JV.
In addition, the report shall also contain the JVs work program for a period of three (3)
years starting from the year the annual report is issued.
Pursuant to Section 10 of EO No. 423, the heads of government entities as defined in
Section 5 of these Guidelines, shall submit to NEDA the salient features and a copy
of JV Agreements amounting to at least Three Hundred Million Pesos (P300 Million)
together with all documents required thereto for monitoring of compliance with
relevant policies, procedures and conditions for approval of the JV undertaking.

Laws on Bases Conversion

234

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

9.0 Amendments. These Guidelines may be amended and/or modified from time to
time by NEDA through its Director-General, in consultation with the GPPB and the
OGCC.
10.0 Separability. If any provision of these Guidelines is held or declared void
or unenforceable by final judgment of a court of competent jurisdiction, the other
provisions unaffected thereby shall remain in full force and effect.
11.0 Effectivity. These Guidelines and any subsequent amendment or modification
shall take effect fifteen (15) calendar days from the date of its publication in a newspaper
of general circulation or the Official Gazette or other modes legally acceptable, and
a copy of it shall be submitted to the Office of the National Administrative Registry
(ONAR) and the UP Law Center.
Annex A
Detailed Guidelines and Procedures
for Public-Private Joint Ventures

for

Competitive Selection

I. The Joint Venture Selection Committee (JV-SC)


1. Composition. The Head of the Government Entity shall create a JV-SC for
purposes of selecting a private partner for a proposed JV. The JV-SC shall be
composed of the following:

Regular Members (voting):


a. Chairman At least a third ranking officer of the Government Entity;
b. Secretary representative from the Government Entitys statutory counsel
(OGCC or the OSG) or any legal officer of the concerned Government
Entity;
c. One (1) officer knowledgeable in finance;
d. One (1) officer knowledgeable in management/operation of the JV;
e. One (1) officer knowledgeable with the technical aspects or requirements
of the project, duly designated by the Head of the Government Entity
concerned on a project-to-project basis, and
f. One (1) representative from the National Economic and Development
Authority.
Provisional Members (non-voting):
g. One (1) technical officer from a concerned regulatory body, when
applicable, knowledgeable with the project at hand, to be invited by the
Government Entity concerned on a project-to-project basis; and
h. Three (3) Observers
I. Two (2) representatives from the private sector one (1) representative
from a duly recognized association related to the project at hand, and

235

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

one (1 representative from either the facility users, if applicable, or


duly recognized accounting associations; and
II. Observer One (1) representative from the Commission on Audit
(COA).
Observers will be notified at least two (2) calendar days before the following
stages: pre-selection conference, opening of technical and financial proposals,
evaluation of technical and financial proposals, contract award, and special
meetings of the JV-SC. The absence of observers will not nullify the JV-SC
proceedings, provided that they have been duly invited in writing.
2. Responsibilities. The JV-SC shall be responsible for all aspects of the preselection and selection process, including, among others, the preparation
of the selection/tender documents, publication of the invitation to apply
for eligibility and submit proposal, pre-qualification of prospective private
sector participants, conduct of pre-selection conferences and issuance of
supplemental notices, interpretation of the rules regarding the selection
process, the conduct of the selection process, evaluation of the financial and
technical proposals, resolution of disputes between private sector participants,
and recommendation for the acceptance of the proposal and/or for the award
of the contract.
3. Quorum. A quorum of the JV-SC shall be composed of a simple majority of all
voting members. The Chairman shall vote only in case of a tie.
II. Selection/Tender Documents
1. Selection/Tender Documents. The Government Entity concerned shall
prepare the selection/tender documents, which shall include the following:
a. Instructions to Private Sector Participants;
b. Minimum Design, Performance Standards/Specifications, and other
Financial and Economic Parameters, where applicable, among others;
c. Feasibility Study or a Business Case/Pre-feasibility Study of the Project;
d. Draft Contract reflecting the terms and conditions in undertaking the
JV activity, including, among others, the contractual obligations of the
contracting parties;
e. Selection Form reflecting the required information to properly evaluate the
technical and financial proposal;
f. Forms of technical and financial proposals and performance securities;
g. Current applicable rules and regulations of the BSP, as applicable;
h. Other documents as may be required by the Government Entity concerned.

Laws on Bases Conversion

236

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

The documents enumerated above are just for guidance/reference. The


Government Entity concerned is given full discretion to select the appropriate
provisions as they assess suitable for a particular contract/project.
2. Instructions to Private Sector Participants. The instructions to private sector
participants, which establish the rules of the selection process, shall be clear,
comprehensive and fair to all private sector participants and shall, as far as
necessary and practicable, include the following information:
a. General description and objectives of the JV activity;
b. Proposal submission procedures and requirements, which shall include
information on the manner of proposal submission, the number of copies
of the technical and financial proposal to be submitted, where the
proposals are to be submitted, the deadline for the submission of proposals,
permissible mode of transmission of technical and financial proposals,
etc.;
c. Amount and form of proposal security and proposal security validity
period;
d. Milestones;
e. Method, parameters and criteria for the evaluation of the proposals;
f. Minimum amount of equity of the prospective JV partner;
g. Requirements of concerned regulatory bodies;
h. Current rules and regulations of the BSP;
i. Revenue sharing arrangement, if any; and
j. Nationality and ownership requirements as, required by law.
3. Minimum Designs, Performance Standards/Specifications and Economic
Parameters. Minimum design and performance standards/specifications,
including appropriate environmental standards by the DENR, shall be clearly
defined and shall refer more to the desired quantity and quality of the outputs of
the JV activity and should state that non-conformity with any of these minimum
requirements shall render the proposals as non-responsive. Likewise, for the
purpose of evaluating proposals, the following economic parameters, among
others and where applicable, shall be prescribed:
a. discount rate, foreign exchange rate and inflation factor;
b. maximum period of project construction;
c. fixed term and price indices to be used in the adjustments of tolls/fees/
rentals/charges, if applicable; and
d. minimum period of repayment, if applicable.
4. Draft Contract. The draft contract should clearly define the basic and legal
relationship between the parties and their rights and responsibilities including

237

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

specific Government Undertakings to be provided by the Government Entity


relative to the JV activity, if any. Specifically, the draft contract shall also
contain provisions on the following matters, as far as practicable:
i.
ii.
iii.
iv.
v.
vi.
vii.
viii.

ix.
x.

xi.
xii.

xiii.
xiv.
xv.
xvi.
xvii.

the date on which the agreement is established, executed, and


considered effective;
the names, addresses and identification of the parties, including the
type of business of each member of the JV;
the name under which the JV will do business;
the principal place of business of the JV;
purpose, term and scope of the JV;
project specifications and features;
a statement that the parties are actually co-venturers for the project,
whether or not the contract is in the name of all members;
the establishment of a fund by the parties to finance the work, together
with the amounts to be contributed by each party, with the fund being
deposited in a special bank account under dual control, and all progress
payments and other revenues being deposited in such account;
procedure for additional capital infusions, if required;
a declaration of the participation of the parties and percentage in which
profits and losses are shared, in proportion to the contributions of the
party to the working fund. The amount of contribution of funds by
parties can be increased or decreased, depending on the contributions
of equipment or expertise;
if equity other than cash is to be contributed, a statement as to how the
property will be valuated, and the ownership of the property during
and after the effectivity of the JV Agreement;
designation of one of the parties as general manager of the project,
with authority to bind the JV Company/Partnership/Parties; or, in the
alternative, the constitution of a management committee, with a
provision for remuneration. Management duties, other duties of the
co-venturers and procedures to be followed in dealing with unusual
situations or problems that may develop, should be specified;
implementation milestones, regular meeting schedules, financial and
periodic JV and progress reporting procedure;
establishment of a JV bank account, and the appointment of a
chartered accountant and lawyer;
provide for the acquisition of licenses in the name of the JV or each
coventurer, as required;
type of insurance carried by the JV and clearly defined liabilities to be
insured against by each participant;
definition of items which are to be considered as costs to the JV for the
purpose of determining profit or loss, and a description of items which
are not reimbursable to members of the JV;

Laws on Bases Conversion

238

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

xviii.
xix.
xx.
xxi.
xxii.
xxiii.
xxiv.
xxv.
xxvi.
xxvii.
xxviii.
xxix.
xxx.
xxxi.
xxxii.
xxxiii.
xxxiv.

confidentiality of trade information passed between the co-venturers;


ownership or retention of patents, technology, and consultant reports;
performance security requirements of the project and the bonding
obligations of the co-venturers;
undivided pro-rata interests held by the co-venturers on all assets of
the JV;
restriction regarding assignment of private sector participants
undivided prorata interests in assets of the JV;
cost recovery scheme;
indemnification and liquidated damages;
performance and warranty bonds;
minimum insurance coverage;
acceptance tests and procedures;
warranty period and procedures;
grounds for and effects of contract termination including modes for
settling disputes and procedure for handling guarantees, defects, and
insurance after termination;
the manner and procedures for the resolution of warranty against
corruption;
compliance with all other laws, rules and regulations;
procedure for exit of the Government Entity and Substitution or
addition of parties;
payout of funds; and
disputes arbitration clause.

III. Publication of Invitation to Apply for Eligibility and to Submit a Proposal


(IAESP)
1. The IAESPs shall be advertised once in a newspaper of general nationwide
circulation, and posted continuously for a period of seven (7) calendar days,
starting on date of advertisement, at the following:
i. Website of the Government Entity concerned, if available;
ii. Website of the Government Entitys service provider, if any; and
iii. Any conspicuous place within the premises of the procuring entity.
2. Private sector participants shall be given at least thirty (30) calendar days from
the last date of publication of the IAESP to apply for eligibility and to submit a
proposal. Notwithstanding, the Government Entity concerned may adjust said
period as may be appropriate for the nature, scope, size, and complexity of the
proposed JV activity. Provided, that the principles of transparency, competition
and accountability are observed.

239

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

IV. Qualification of Private Sector Participants


1. Who may Participate. Any individual, partnership, corporation or firm, or
consortium, whether local or foreign, subject to the limits set herein.
2. Eligibility Requirements
a. Legal Requirements. If the JV activity requires a public utility franchise,
the private sector participant must be duly registered with the SEC and be
at least 60% Filipino-owned. For projects other than these, prospective
private sector participant shall comply with nationality and ownership
requirements under the Constitution and other applicable laws and
issuances.
For JV activities to be operated by the prospective JV Partner or a facility operator
where operation of the facility does not require a public utility franchise, the
JV partner or facility operator or concessionaire may be Filipino or foreignowned, as maybe allowed under applicable laws, rules, and regulations.
b. Technical Requirements. The prospective JV Partner must have completed
a similar or related project costing at least 50% of the JV activity subject
of the selection process within the relevant period as determined by the
Government Entity. The prospective JV Partner shall submit a statement of
all its ongoing and completed government and private contracts similar
or related to the JV activity subject of the selection process, including
contracts awarded but not yet started, if any.
c. Financial Capability. The Government Entity shall determine before
evaluation of eligibility, the minimum amount of equity needed for the JV
activity.

The following documents shall be submitted by the prospective JV Partner:


i. Audited financial statements for the past three calendar years. If the
prospective JV Partner is Filipino, the audited financial statements
to be submitted must be stamped received by the BIR or its duly
accredited and authorized institutions; and
ii. Latest tax returns, if the JV Partner is Filipino.

d. In case of consortia, all member entities of the prospective JV Partner shall


also submit the above legal, technical and financial eligibility requirements
to determine the overall capability of the consortia for the JV undertaking.

Laws on Bases Conversion

240

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

e. Acceptance of Criteria and Waiver of Rights to Enjoin JV Activity. In addition


to the above, all prospective private sector participants shall be required
to submit, as part of their qualification documents, a statement stipulating
that the private sector participant (i) has accepted the qualification criteria
established by the JV-SC of the Government Entity concerned; and (ii)
waives any right it may have to seek and obtain a writ of injunction or
prohibition or restraining order against the concerned Government Entity
or its JV-SC to prevent or restrain the qualification proceedings related
thereto, the award of the contract to a successful private sector participant,
and the carrying out of the awarded contract. Such waiver shall, however
be, without prejudice to the right of a disqualified or losing private sector
participant to question the lawfulness of its disqualification or the rejection
of its proposal by appropriate administrative or judicial processes not
involving the issuance of a writ of injunction or prohibition or restraining
order.
Financial capability shall be measured in terms of: i) proof of ability of
the prospective JV Partner to provide a minimum amount of equity to
the JV activity, measured in terms of the net worth of the company, or a
deposit equivalent to the minimum equity required set aside or ear-marked
for the proposed JV Activity; and ii) a letter from a domestic universal/
commercial bank, or an international bank with a subsidiary/branch in
the Philippines, or any international bank recognized by the BSP, attesting
that the prospective JV Partner is one of its current clients, and is in good
financial standing.
3. Eligible and Ineligible. The Government Entity, through its JV-SC, shall within a
period of fifteen (15) calendar days after the deadline set for the submission of
the eligibility documents, complete the evaluation of the eligibility documents
of the prospective JV Partners, and determine which among them are eligible
and ineligible. Accordingly, the JV-SC shall duly inform the eligible JV Partners
within seven (7) calendar days after approval thereof. Ineligible private sector
participants shall be similarly given notice of such ineligibility, stating therein
the grounds for ineligibility within the same period.
Those ineligible may appeal their ineligibility to the Head of the Government
Entity or his authorized representative, within seven (7) calendar days from
receipt of the notice of ineligibility. The selection process will be suspended
for a maximum period of thirty (30) calendar days while the appeal is being
evaluated. The Head of the Government Entity or his authorized representative
shall act on the appeal within the thirty (30) calendar day period of suspension
of the selection process. The decision of the Head of the Government Entity,
or his authorized representative, on the appeal shall be final and immediately
executory. If the appeal is not resolved within said period, the appeal is deemed
denied, and the selection process will proceed.

241

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

4. Issuance of Tender Documents. The Government Entity concerned shall make


available the related competitive selection documents to all eligible private
sector participants as soon as practicable to provide respective private sector
participants ample time to examine the same and to prepare their respective
proposals prior to the date of opening of the proposals. The time period from
the last day of the issuance of tender documents to the date of opening of the
proposal shall not exceed sixty (60) calendar days for JV Agreements costing
more than Php 500 Million, and thirty (30) calendar days for JVAs costing less
than Php 500 Million.
The proposal parameters for the proposed JV activity should be transparent
and fair. It should not, in any way, be tailor-made for or meant to favor or give
advantage to a particular private sector participant.
V. Supplemental Competitive Selection Bulletins and Pre-Selection Conferences
1. Responsibility of the Private Sector Participant. The prospective private
sector participant shall be solely responsible for having taken all the necessary
steps to carefully examine and acquaint himself with the requirements and
terms and conditions of the selection documents with respect to the cost,
duration, and execution/operation of the project as it affects the preparation
and submission of its proposal. The Government Entity concerned shall not
assume any responsibility regarding erroneous interpretations or conclusions
by the prospective private sector participant out of data furnished or indicated
in the competitive selection documents.
2. Supplemental Notices. A prospective private sector participant may submit
a written request to the Government Entity concerned on or before the PreSelection Conference as to the meaning of any data or requirements or any
part of the selection documents. Any substantive interpretation given by the
concerned Government Entity shall be issued in the form of a Supplemental
Notice, and furnished to all prospective private sector participants. The
Government Entity concerned may also issue Supplemental Notices to all
prospective private sector participants at any time for purposes of clarifying
any provisions of the selection documents, provided that the same is issued
within a reasonable period to allow all private sector participants to consider
the same in the preparation of their proposals. Receipt of all Supplemental
Notices shall be duly acknowledged by each private sector participants prior
to the submission of his proposal and shall be so indicated in the proposal.
3. Pre-Selection Conference. For JV activities involving government exposure
of less than Php 500 million, pre-selection conference shall be conducted by
the Government Entity at least fifteen (15) calendar days before the deadline
for the submission of proposals. For JV activities involving government
exposure of at least Php 500 million, the pre-selection conference shall be
Laws on Bases Conversion

242

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

conducted at least thirty (30) calendar days before the submission of proposals.
Notwithstanding, the Government Entity concerned may adjust said period as
may be appropriate for the nature, scope, size, and complexity of the proposed
JV activity. Provided, that the principles of transparency, competition and
accountability are observed.
VI. Submission and Receipt of Proposals
1. Requirements for Submission of Proposals. Private sector participants shall
be required to submit their proposals on or before the deadline stipulated in
the Instructions to Participants. For eligible participants, proposals shall be
submitted in two (2) separate sealed envelopes, the first being the technical
proposal and the second the financial proposal.
a. The technical proposal shall contain the following, as applicable:
1. compliance statements with regard to the technical parameters as
stated in the tender documents;
2. operational feasibility;
3. technical soundness, including proposed project timeline;
4. preliminary environmental assessment;
5. cost and financing plan of the JV activity; and
6. proposal security in accordance with the following schedule:
Cost of JV Activity as Estimated
by the Government Entity

Required Proposal Security

Less than PhP 5.0 billion

2.0% of the cost of the JV activity

Less than PhP 5.0 billion to


Less than PhP 10.0 billion

2.0% of the cost of the JV activity


or PhP 100 million, whichever is
higher

PhP 10.0 billion and more

1.0% of the cost of the JV activity


or PhP 150 million, whichever is
higher

7. other documents to support the private sector participants technical


proposal, as may be required by the concerned Government Entity.
b. The financial proposal shall contain the following, as the case may be:
1. compliance statements with regard to the financial parameters stated
in the tender documents
2. proposed cost of the JV activity, operation and maintenance cost, the
amount of equity to be infused and debt to be obtained for the project,
sources of financing, and all other related costs

243

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

3. financial proposal corresponding to the parameters set by the


concerned Government Entity
Fifty percent (50%) of the equity to be provided by the private sector entity
should as much as possible come from its own resources and not borrowed.
The government entity concerned is not precluded from specifying other
requirements for the technical and financial proposals that are best suited for
the specific JV activity.
2. Submission of late proposals. Proposals submitted after the deadline for
submission prescribed in the Instructions to Private Sector Participants shall
be considered late and shall be returned unopened.
VII. Opening and Evaluation of Proposals
1. Opening of the envelope for the technical proposal. At the date and time of the
proposal opening stipulated in the Instructions to Private Sector Participants,
the JV-SC shall open only the first envelope containing technical proposal and
ascertain (a) whether the same is complete in terms of the data/information
required under Section VI.1 (a) above; and (b) whether the same is accompanied
by the required proposal security in the prescribed form, amount, and period
of validity. All private sector participants, or their representatives, present at
the opening of the envelopes containing the technical proposal shall sign a
register of the proposal opening.
2. Evaluation of the technical proposal. The evaluation of the first envelope
containing the technical proposal shall involve the assessment of the technical,
operational, environmental, and financing viability of the proposal, vis-vis the prescribed requirements and criteria/minimum standards, and basic
parameters prescribed in the competitive selection documents.
The JV-SC of the Government Entity concerned shall complete the evaluation
of the technical proposal within fifteen (15) calendar days from the date the
proposals are opened. Only those proposals that have been determined to have
positively passed the evaluation of the technical proposal shall be qualified
and considered for the evaluation of the financial proposal.
3. Opening of the envelope for the financial/technical proposal. Only the
financial proposals of private sector participants who passed the evaluation
described under Section VII.2 hereof, shall be opened for further evaluation.
The financial proposals tendered by private sector participants who failed
the technical proposal evaluation under Section VII.2 hereof, shall not be
considered further, and shall be returned, unopened, together with a notice
stating the reasons for disqualification from further consideration.
Laws on Bases Conversion

244

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

The JV-SC shall notify the private sector participants qualifying for the second
stage of evaluation of the date, time and place of the opening of the envelopes
for the financial proposal. The opening thereof shall follow the same procedure
prescribed for the opening of the envelopes containing technical proposals.
4. Evaluation of the financial proposal. The evaluation of the financial proposal
shall involve the assessment and comparison of the financial proposals
against the financial parameters stated in the tender documents and proposal
parameters set by the Government Entity concerned. The proposed financing
plan must show that the same adequately meets the costs relative to the JV
activity. The second stage evaluation of financial proposals shall be completed
by the JV-SC of the concerned Government Entity within fifteen (15) calendar
days.
5. Simultaneous evaluation of the technical and financial proposals. Subject to
the determination of the Head of the Government Entity wherein the nature of
the JV activity shall warrant the appreciation of both the technical and financial
proposals as a whole in order to determine the best proposal, simultaneous
evaluation of the technical and financial proposals may be resorted to.
Provided, that, said evaluation procedure shall be explicitly stated in the
proposal documents. Simultaneous evaluation of the technical and financial
proposals shall be completed within thirty (30) calendar days from the date the
proposals are opened.
6. Prescriptive periods. The periods stated for the evaluation of the technical
and financial proposals are prescriptive. The Government Entity concerned
may adjust said periods as may be appropriate for the nature, scope, size,
and complexity of the proposed JV activity. Provided, that the principles of
transparency, competition and accountability are observed.
7. Rejection of proposals. Non-compliance to the information required on either
the first or second envelope shall be grounds for rejection of proposals.
8. Withdrawal and/or modification of proposals. Withdrawal and/or modification
of proposals may be allowed upon written notice by the private sector participant
concerned, to the Government Entity prior to the time and date set for the
opening of the envelope containing the technical proposal as specified in the
Instructions to Private Sector Participants. No proposals shall thereafter be
modified or withdrawn. Proposal modifications received after said period shall
be considered late and will be returned unopened. Withdrawal of proposals
after the proposal opening date shall cause the forfeiture of the private sector
participants proposal security.

245

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

9. Right to Reject All Proposals. The Government Entity concerned reserves the
right to reject any or all proposals, waive any minor defects therein and accept
the offer it deems most advantageous to the government.
VIII. Award and Approval of Contract
1. Recommendation to Award. Within seven (7) calendar days from the date
the evaluation procedure adopted is completed, the JV-SC shall submit the
recommendation of award to the Head of the Government Entity concerned.
The JVSC shall include as part of its recommendation, a detailed evaluation/
assessment report on its decision regarding the evaluation of the proposals,
and explain in clear terms the basis of its recommendations.
2. Decision to Award. Within seven (7) calendar days from the submission by JVSC of the recommendation to award, the Head of the Government Entity shall
approve or reject the same. The approval shall be manifested by signing and
issuing the Notice of Award to the winning private sector participant within
seven (7) calendar days from approval thereof.
All participating private sector participants shall be informed of the award in
writing. Such decision shall be made available to the public upon request.
3. Notice of Award. The Notice of Award to be issued by the Head of
Government Entity concerned, shall contain among others, an instruction to
the winning private sector participant to comply with conditions precedent for
the execution of the JV Agreement and to submit compliance statements with
regard thereto, within fifteen (15) calendar days from receipt of the Notice of
Award.

Failure to comply with the conditions precedent for the execution of the
contract within the prescribed fifteen (15)-calendar day period will result
in confiscation of the proposal security. Within seven (7)-calendar days
from receipt of the compliance statements from the winning private sector
participant, the Head of the Government Entity shall determine the sufficiency
of the same, and notify the winning private sector participant accordingly.

4. Validity of Proposals/Return of Proposal Security. The execution of the JV


Agreement shall be made within the period of the validity of the proposal
security. The required proposal security shall be valid for a reasonable period,
but in no case beyond one hundred eighty (180) calendar days following
the opening of the proposals. Proposal securities shall be returned to the
unsuccessful private sector participants upon signing of the JV Agreement by
the winning private sector participant.

Laws on Bases Conversion

246

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

5. Extension of Validity of Proposals. When an extension of validity of proposals


is considered necessary, those who submitted proposals shall be requested in
writing, to extend the validity of their proposals before the expiration date of
the same. However, private sector participants shall not be allowed to modify
or revise the price or other substantial aspect of their proposals.

Private sector participants shall have the right to refuse such an extension
without forfeiting their proposal security. As a condition of the extension of
the validity of their proposals, participating private sector participants must
correspondingly extend the validity of their proposal security.

6. Failure of Competitive Selection. There shall be a failure of competitive


selection in any of the following instances:
a. If there is only a single party who submits eligibility documents within the
deadline stipulated in Invitation to Apply for Eligibility and to Submit a
Proposal;
b. If at anytime prior to the issuance of the notice of eligibility, should interested
parties withdraw from the competitive selection process outlined in Annex
A, with the effect that there is only a single interested party remaining;
c. If there is only a single interested party who is determined to be eligible to
submit a proposal;
d. If at anytime after the issuance of the notice of eligibility until deadline
for submission of proposals, should eligible private sector participants
withdraw from the competitive selection process outlined in Annex A
with the effect that there is only a single eligible private sector participant
remaining and eligible to submit a proposal;
e. If there is only a single eligible private sector participant that submits a
proposal;
f. Should no Technical Proposal be rated passed;
g. If there is be only a single eligible private sector participant whose
Technical Proposal is rated passed, but whose Financial Proposal does
not meet the financial parameters set for in the Tender Documents: and
h. Should no Financial Proposal of any eligible private sector participant
whoseTechnical Proposal is rated passed, meets the financial parameters
set forth in the Tender Documents.
i. No proposals were received or no private sector entity is found qualified
for the JV undertaking.
In the event of a failed competitive selection brought about by instances
stipulated under items a., b., c., d., e, g. and h. above, the JV Activity, at
the sole decision of the Head of the Government Entity concerned, may be
subjected to a competitive selection once more, or, may be the subject of
limited negotiations in accordance with Annex B hereof. In the event of a
failed competitive selection brought about by an instance stipulated under item

247

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

f. above, a competitive selection shall be conducted again by the Government


Entity. In the event of a failed competition brought about by item (i) above,
the Head of Agency concerned may seek private sector entities for the JV
undertaking subject to Annex C hereof.
7. Execution/Approval of the JV Agreement. The authorized signatory(ies) of the
winning private sector participant and the Government Entity concerned,
shall execute and sign the JV Agreement, within seven (7) calendar days from
receipt by the winning private sector participant of the notice referred to in
VIII.3 above.
Consistent with Article 1159 of the New Civil Code, said JV Agreement is
considered the law between the parties, and the parties shall perform their
respective prestations, obligations, and undertakings thereunder with utmost
good faith, with a view to attaining the objective thereof. An original signed
copy of the contract shall be submitted to:
1.
2.
3.
4.
5.

The Office of the President;


NEDA;
Statutory Counsel;
GPPB; and
DOF in case of GOCCs and GFIs, and DBM in case of other entities;

In the event of refusal, inability or failure of the winning private sector participant
to enter into contract with the Government Entity concerned, within the time
provided therefore, said Government Entity shall forfeit its proposal security. In
such event, the Government Entity concerned shall consider the private sector
participant with the next ranked complying proposal as the winning private
sector participant, and notify said private sector participant accordingly. If
the next ranked complying private sector participant shall likewise refuse or
fail to enter into contract with the Government, its proposal security shall
likewise be forfeited and the Government Entity concerned shall consider the
next ranked complying proposal, and so on, until a contract shall have been
entered into. In the event that the concerned Government Entity is unable to
execute the contract with any of the complying private sector participants, a
failure of competitive selection will be declared and the JV may be subjected
to a competitive selection again.
8. Other Approvals for Contract. The entity tasked under the JV Agreement
shall, as may be required under existing laws, rules and regulations,
secure any and all other approvals for the contract, or the implementation
thereof, from government agencies or bodies including the Regulator, in
the case of Public Utility Projects. This includes securing the necessary and
appropriate environmental clearances from the DENR prior to actual project
implementation. The DENR shall act on the environmental clearance of the JV
Laws on Bases Conversion

248

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

activity within the time frame prescribed and following the guidelines of the
DENR Administrative Order No. 96-37 and subsequent guidelines as may be
issued from time to time. The Government Entity may provide the necessary
assistance to its JV partner in securing all the required clearances. The contract
shall provide milestones in securing such other approvals required for the
implementation of the contract.
Prior to the execution of the JV Agreement, the OGCC, OSG or other entity
prescribed by law/issuances as the statutory counsel of GOCCs, GCEs and
GICPs, shall issue the corresponding Counsels Opinion.
9. Contract Effectivity. The contract shall be effective upon signing thereof by the
Head of Government Entity and unless another date is stipulated therein.
IX. Appeals Mechanism
1. Decisions of the JV-SC with respect to conduct of the competitive selection
process may be appealed in writing to the Head of the Government Entity
concerned: Provided, however, that a prior motion for reconsideration should
have been filed by the party concerned, and the same has been resolved
JV-SC. The appeal must be filed within seven (7) calendar days from receipt
by the party concerned of the resolution of the JV-SC denying its motion for
reconsideration. An appeal may be made by filing a verified position paper
with the Head of the Government Entity concerned, accompanied by the
payment of a non-refundable appeal fee. The non-refundable appeal fee shall
be in an amount equivalent to no less than one-half (1/2) of one percent (1%)
of the project cost.
X. Final Approval
1. Contract Award and Final Approval. Subject to the charter of the Government
Entity concerned, no further and higher approval is necessary, unless the
same is required by Law to be acted upon by the President. In which case,
the procedure stipulated under Section 6 (Government Contracts Requiring
Presidential Action and/or Approval) of EO No. 423, as amended by EO No.
645, shall be followed. Upon approval of the JV Agreement, the Government
Entity concerned shall adhere to the requirements of Section 10 (Submission
of Government Contracts) of the same EO, as deemed applicable.

249

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

Annex B
Detailed Guidelines for Limited Negotiation Procedures in Case
of Failed Competitive Selection Under Section 6 of Annex A
of the Guidelines
Upon the declaration of a failed competitive selection under Section VIII.6 of Annex A of
the Guidelines, the Government Entity concerned shall enter into limited negotiations.
The Government Entity concerned shall set the timetable of the various activities for
the limited negotiations. The Government Entity concerned may terminate the limited
negotiations should the party it is negotiating with fail to observe the said timetable.
The negotiations shall be in accordance with the following procedures:
I. Should there be a failure of competitive selection brought about by instances
stipulated under Section VIII.6.a and 6.b as outlined in Annex A, with the effect
that there is only one (1) interested party remaining, the following procedure shall
be observed:
a. The Government Entity concerned shall proceed with the determination of the
eligibility of the sole private sector entity;
b. The sole private sector entitys eligibility documents shall be evaluated in
accordance with the rules set forth in Annex A of the Guidelines;
c. If the eligibility documents are found to be insufficient and rated failed, the
Government Entity concerned shall terminate the negotiations. In the event
the negotiations are terminated, the Head of the Government Entity, at its sole
option, may conduct again a competitive selection or decide to pursue the
proposed activity through alternative routes other than JV;
d. If the eligibility documents are found sufficient and rated passed, the
Government Entity concerned shall give the sole private sector entity the draft
tender documents in accordance with Annex A of the Guidelines;
e. The sole private sector entity shall submit a proposal in accordance and
compliance with Annex A of the Guidelines;
f. The Government Entity concerned shall simultaneously evaluate the technical
and financial proposals of the sole private sector entity in accordance with
Annex A of the Guidelines;
g. If the proposal of the sole private sector entity is rated failed, the
Government Entity concerned shall terminate the negotiations and, the Head
of the Government Entity, at its sole option, may conduct again a competitive
selection or decide to pursue the proposed activity through alternative routes
other than JV.
h. Should the proposal of the sole private sector entity meet the parameters set
forth in the tender documents, the Government Entity concerned shall enter
into the JV Agreement with the sole private sector entity concerned. In the
event that an agreement is not reached, negotiations shall be terminated.
Laws on Bases Conversion

250

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

II. Should there be a failure of competitive selection brought about by instances


stipulated under Section VIII.6.c and 6.d as outlined in Annex A with the effect
that there is only one (1) interested party remaining and eligible to submit a
proposal the following procedure shall be observed:
a. The sole eligible party shall be instructed to submit a proposal.
b. The process outlined in I(d) to (h) above shall then be observed and followed.
III. Should there be a failure of competitive selection brought about by Section
VIII.6.e as outlined in Annex A such that only one (1) proposal is received by the
Government Entity, the process outlined in I(f) to (h) above shall then be observed
and followed.
IV. Should there be a failure of competitive selection brought about by Section VIII.6.g
and 6.h as outlined in Annex A, the following procedure shall be observed:
a. The negotiation shall be on a Financial Proposal only basis. The Technical
Proposal shall remain valid and binding.
b. The eligible private sector participant/s whose Technical Proposal/s was/were
rated passed but whose Financial Proposal/s is/are non-compliant with the
Financial Parameters outlined in the Tender Documents, shall be asked to
submit a revised Financial Proposal.
c. Should there be more than one revised Financial Proposal, the revised Financial
Proposal/s shall be evaluated in accordance with Annex A of the Guidelines.
d. Should the revised Financial Proposal meet the Financial Parameters outlined
in the Tender Documents, the Government Entity concerned shall enter into
the JV Agreement with the eligible Private sector participant (if there is only
one remaining) or with the eligible private sector participant submitting the
most advantageous Financial Proposal, in accordance with Annex A of the
Guidelines. Should the eligible private sector participant still fail to meet the
Financial Parameters outlined in the Tender Documents, the Government
Entity concerned shall terminate the negotiations with the said eligible private
sector participant/s, and, the Head of the Government Entity, at its sole option,
may conduct another round of competitive selection, or decide to pursue the
proposed activity through alternative routes other than JV.
Annex C
Detailed Guidelines for Competitive Challenge Procedure
for Public-Private Joint Ventures
I. Negotiated JVs Any Government Entity may directly negotiate a JV activity with a
private sector entity whenever allowed under the Guidelines issued by the NEDA.
II. Competitive Challenge Procedure In all cases where the Government Entity
directly negotiates with a private sector participant for a proposed JV undertaking,

251

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

the negotiated terms shall be subjected to a competitive challenge wherein other


private sector entities shall be invited to submit comparative proposals, to ensure
that JV Agreements are entered into under a transparent and competitive process
that promotes accountability in government transactions.
III. Three-Stage Framework Negotiated JV Agreements shall be subjected to a threestage process, summarized as follows:
Stage One A private sector entity submits an unsolicited proposal to the
Government Entity, or the Government Entity seeks out a JV partner after failed
competition for a JV activity deemed manifestly advantageous to Government. The
private sector entity submits a proposal to the Government Entity for a projected
JV activity/undertaking. The Government Entity, through its JV-SC, is tasked with
the initial evaluation of the proposal. Upon completion of the initial evaluation,
the Head of the Government Entity, upon recommendation of the JV-SC, shall
either issue an acceptance or nonacceptance of the proposal. The Government
Entity concerned shall act on the proposal within ten (10) working days upon
submission of complete documents by the private sector entity. An acceptance
shall not bind the Government Entity to enter into the JV activity, but, shall mean
that authorization is given to proceed with detailed negotiations on the terms and
conditions of the JV activity. In case of non-acceptance, the private sector entity
shall be informed of the reasons/grounds for non-acceptance.
Stage Two The parties negotiate and agree on the terms and conditions of the JV
activity. The following rules shall be adhered to in the conduct of detailed
negotiations and the preparation of the proposal documents in case of a successful
negotiations:
1. Both parties shall negotiate on, among others, the purpose, terms and
conditions, scope, as well as all legal, technical, and financial aspects of
the JV activity.
2. The JV-SC shall determine the eligibility of the private sector entity to enter
into the JV activity in accordance with Sec. IV.2 (Eligibility Requirements)
under Annex A hereof.
3. Negotiations shall comply with the process, requirements and conditions as
stipulated under Sections 6 (General Guidelines) and 7 (Process for Entering
into JV Agreements) of the Guidelines. Once negotiations are successful,
the Head of the Government Entity and the authorized representative of
the private sector entity shall issue a signed certification that an agreement
has been reached by both parties. Said certification shall also state that the
Government Entity has found the private sector participant eligible to enter
into the proposed JV activity and shall commence the activities for the
solicitation for comparative proposals. However, should negotiations not
Laws on Bases Conversion

252

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

result to an agreement acceptable to both parties, the Government Entity


shall have the option to reject the proposal by informing the private sector
participant in writing stating the grounds for rejection and thereafter may
accept a new proposal from private sector participants, or decide to pursue
the proposed activity through alternative routes other than JV. The parties
shall complete the Stage Two process within thirty (30) calendar days upon
acceptance of the proposal under Stage One above.
4. After an agreement is reached, the contract documents, including the
selection documents for the competitive challenge are prepared.
Stage Three Once the negotiations have been successfully completed, the JV
activity shall be subjected to a competitive challenge, as follows:
1. The Government Entity shall prepare the tender documents pursuant to
Section II (Selection/Tender Documents) of Annex A hereof. The eligibility
criteria used in determining the eligibility of the private sector entity
shall be the same as those stated in the tender documents. Proprietary
information shall, however, be respected and protected, and treated with
confidentiality. As such, it shall not form part of the tender and related
documents. The Head of the Government Entity shall approve all tender
documents including the draft contract before the publication of the
invitation for comparative proposals.
2. Within seven (7) calendar days from the issuance of the Certification of
a successful negotiation referred to in Stage Two above, the JV-SC shall
publish the invitation for comparative proposals in accordance with
Section III.2. (Publication of Invitation to Apply for Eligibility and to Submit
Proposal) under Annex A hereof.
3. The private sector entity shall post the proposal security at the date of the
first day of the publication of the invitation for comparative proposals in
the amount and form stated in the tender documents.
4. The procedure for the determination of eligibility of comparative proponents/
private sector participants, issuance of supplemental competitive selection
bulletins and pre-selection conferences, submission and receipt of
proposals, opening and evaluation of proposals shall follow the procedure
stipulated under Annex A hereof. In the evaluation of proposals, the best
offer shall be determined to include the original proposal of the private
sector entity. If the Government Entity determines that an offer made by a
comparative private sector participant other than the original proponent
is superior or more advantageous to the government than the original
proposal, the private sector entity who submitted the original proposal
shall be given the right to match such superior or more advantageous

253

Laws on Bases Conversion

NEDA JOINT VENTURE GUIDELINES AND PROCEDURES

offer within thirty (30) calendar days from receipt of notification from the
Government Entity of the results of the competitive selection. Should no
matching offer be received within the stated period, the JV activity shall be
awarded to the comparative private sector participant submitting the most
advantageous proposal. If a matching offer is received within the prescribed
period, the JV activity shall be awarded to the original proponent. If no
comparative proposal is received by the Government Entity, the JV activity
shall be immediately awarded to the original private sector proponent.
5. Within seven (7) calendar days from the date of completion of the
Competitive Challenge, the JV-SC shall submit the recommendation of
award to the Head of the Government Entity. Succeeding activities shall
be in accordance with Sections VIII. (Award and Approval of Contract) and
X (Final Approval) of Annex A hereof.

Laws on Bases Conversion

254

REVISED AFP MODERNIZATION PROGRAM - Republic Act No. 10349

Republic Act No. 10349


An Act of Amending Republic Act No. 7898, Establishing
the Revised AFP Modernization Program and for Other Purposes
Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:
SECTION 1. Section 4(b), (d) and (e) of Republic Act No. 7898, otherwise known as
the AFP Modernization Act , is hereby amended to read as follows:
Sec. 4. Components of the Revised AFP Modernization Program. - The Revised
AFP Modernization Program shall consist of the following components:
(a) x x x
(b) Capability, materiel, and technology development - The AFP Modernization
Program entails the development and employment of certain capabiilties that
can be address and assessed threats: Provided, That the acquisition of air force,
navy and army equipment and materiel of such types and quantities shall be
made in accordance with the need to develop AFP capabilities pursuant to
its modernization objectives: Provided, further, That the acquisitions of the
new equipment and weapons systems shall be synchronized with the phaseout of uneconomical and obsolete major equipment and weapons systems
in the AFP inventory: Provided, even further, That no major equipment and
weapons system shall be purchased if the same are not being used by the
armed forces in the country of origin or used by the armed forces of at least
two countries: Provided, furthermore, That only offers from suppliers who are
themselves the manufacturers shall be entertained: Provided, finally, That no
supply contract shall be entered into unless such contract provides for, in clear
and unambiguous terms, an after-sales services and the availability of spare
parts.
(c) x x x
(d) Human resource development - The human resource development
component of the Revised AFP Modernization Program shall have the following
objectives:
(1) x x x
(2) To develop and transform the AFP in to a multi-mission oriented force
capable of effectively addressing internal and external security threats;

255

Laws on Bases Conversion

REVISED AFP MODERNIZATION PROGRAM - Republic Act No. 10349

(3) x x x
(4) x x x
(5) x x x
(6) x x x
(e) Doctrines development - The Department of National Defense and the
AFP shall be responsible for the generation, evaluation, consolidation and
formalization of doctrines; the conduct of periodic review and validation of
doctrines through field application, testing and exercises; and the dissemination
of approved doctrines at all level command.
The Secretary of National Defense shall formulate a guidelines to implement
this section in accordance with the objectives of the modernization program
enumerated in the preceding section.
SECTION 2. Section 6 of the same Act is hereby amended to read as follows:
Sec. 6. Period of Implementation. - The Revised AFP Modernization Program
under this Act shall be implemented over a period of fifteen (15) years effective
upon the date of the approval of this Act: Provided, however, That payments
for amortization of outstanding multi-year contract obligations incurred under
the Revised AFP Modernization Act may extend beyond this period.
SECTION 3. Section 7 of the same Act is hereby amended to read as follows:
Sec. 7. Submission of the Revised AFP Modernization Program. - (a)
Within sixty (60) days from the effectivity of this Act, the President, upon
the recommendation of the Secretaries of National Defense and Budget
Management, shall submit the Revised AFP Modernization Program as
provided for in this Act to Congress. The Program shall indicate or show inter
alia:
(1) The size and shape of the AFP in terms of personnel, equipment, and
facilities during the various phases of the modernization program;
(2) The modernization projects under it, including the major weapon and
non-weapon equipment and technology acquisitions sought by the respective
services and units of the AFP, any major infrastructure construction or
improvement to be made and the particular objective(s) and component(s)
under Section 3 and 4, respectively, of this Act to which such intended
acquisition, construction or improvements belongs; and

Laws on Bases Conversion

256

REVISED AFP MODERNIZATION PROGRAM - Republic Act No. 10349

(3) The priorities, schedules as well as estimated average cost of each


modernization project or upgrading to be undertaken: Provided, That in
the implementation of the AFP Modernization Program, the acquisition
of equipment or upgrading to be undertaken shall be devoted towards the
development of the AFP with shifting capability to meet internal and external
threats.
(b) The Revised AFP Modernization Program, as submitted to Congress shall
be the basis for subsequent executive and legislative actions to implement the
Revised AFP Modernization Program from year to year until its complete and
full realization.
SECTION 4. Section 8 of the same Act is hereby amended to read as follows:
Sec. 8. Appropriations for the Revised AFP Modernization Program. - The
annual appropriations for the Revised AFP Modernization Program shall
include the amounts necessary to support the funding requirements for all
modernization projects submitted to Congress under the preceding section.
The funds to be appropriated by Congress under this Act shall be treated
as a distinct and separate budget item from the regular appropriation for the
Department of National Defense (DND) and the AFP and shall be administered
by the Secretary of National Defense.
The Revised AFP Modernization Program shall be based on an amount of
at least Seventy-five billion pesos (P75,000,000,000.00) for the first five (5)
years.
SECTION 5. Section 9(b) and (c) of the same Act are hereby amended to read as
follows:
Sec. 9. Multi-year Contracts and Other Contractual Arrangements. (a) x x x
(b) For Multi-year contracts, Congress shall, upon issuance of the multi-year
obligational authority by the Department of Budget and Management (DBM),
make the corresponding appropriation for the issuing fiscal years. Provided,
That the DND and the DBM shall issue implementing guidelines to ensure
consistency with the Revised AFP Modernization Program and existing
guidelines in the contracting of multi-year projects.
(c) The Secretary of National Defense shall submit to Congress, through the
Chairpersons of the Senate Committees on National Defense and Security and
Finance and the Chairpersons of the House Committeeson National Defense
and Security and Appropriations, copies of these multi-year contracts and
other agreements/arrangements to enable Congress to appropriate funds.

257

Laws on Bases Conversion

REVISED AFP MODERNIZATION PROGRAM - Republic Act No. 10349

SECTION 6. Section 11 of the same Act is hereby amended to read as follows:


Sec. 11. The Revised AFP Modernization Act Trust Fund. There is hereby
created a trust fund, to be known as the Revised AFP Modernization Act Trust
Fund. Said trust fund, which shall be used exclusively for the AFP modernization
program, including all necessary expenses to implement the procurement of
equipment such as expenses for pre-selection and post-qualification stages, but
not to include salaries and allowances, shall be funded out of the following:
(a) Appropriations for the Revised AFP Modernization Program;
(b) The proceeds from the sale of military reservations, as may be authorized
by Congress, pursuant to the provisions of existing laws and regulations
governing sales of government properties, including such immovable and
other facilities as may be found therein, not otherwise covered by the Bases
Conversion and Development Authority, as provided for in Republic Act No.
7227, as amemded;
(c) The proceeds from the lease or joint development of military reservations,
as may be authorized by the President, pursuant to the provisions of existing
laws and regulations governing lease or joint development of government
properties, including such immovables and other facilities as may be found
therein, not specifically enumerated under Republic Act No. 7227, as amended;
(d) Shares of the AFP from the proceeds of the sale of military camps provided
for under Republic Act No. 7227, as amended, and at least fifty percent (50%)
of the proceeds, net of direct expenses authorized to be deducted from such
proceeds from the lease and/or joint venture agreements and such other
dispositions pertaining to the same camps in accordance with applicable and/
or existing orders, rules, regulations and issuances.
The DND or the AFP may assign to the Bases Conversion and Development
Authority or designate it as disposition entity for the sale, lease or joint
development of military reservations or portions thereof or facilities and
immovables located therein not otherwise covered under Republic Act No.
7227, as amended, subject to the parameters set by the DND or the AFP and
applicable laws, rules, regulations and other related issuances.
(e) The proceeds derived from public-private partnerships entered into by
the DND of the AFP, as may be authorized by the President, pursuant to the
provisions of existing laws and regulations;
(f) Proceeds from the sale of the products of the Government Arsenal and/
or, in case of joint venture. all incomes earned from the equity share of the
Government Arsenal from the joint venture;
Laws on Bases Conversion

258

REVISED AFP MODERNIZATION PROGRAM - Republic Act No. 10349

(g) The proceeds from the disposal of excess and/or uneconomically repairable
equipment and other inovable assets of the AFP and the Government Arsenal;
(h) Funds from budgetary surplus, if any, as may be auhtorized by Congress
subject to the provisions of Section 8 of this Act;
(i) Donations coming from local and foreign sources, specifically earmarked
to be used for the Revised AFP Modernization Program; and
(j) All interest income of the trust fund.
Funds from the foregoing sources, regardless of income source, shall be
directly deposited to a special account in the general fund created specifically
for the Revised AFP Modernization importation of the same by the AFP shall
likewise be exempt from the value-added tax and customs duties.
Sec. 18. Congressional Oversight Committee. There is hereby created a
Congressional Oversight Committee to monitor and oversee the implementation
of the provisions of this Act. The Committee shall be composed of six (6)
members from the Senate and six (6) members from the House of Representatives
with the Chairpersons of the Committees on National Defense and Security
of both Houses as Joint Chairpersons. The five (5) other members from each
Chamber shall be designated by the Senate President and the Speaker of the
House of Representatives, respectively. The Minority shall have at least two (2)
representatives from both Chambers.
Sec. 19. Sunset Review. As the need arises or within five (5) years after its
effectivity, the Congressional Oversight Committee shall conduct a sunset
review of this Act. The term sunset review shall mean a systematic evaluation
of the accomplishments and impact of this Act, as well as the performance
and organizational structure of its implementing agencies, for purposes of
determining remedial legislation.
SECTION 11. All sections of the same Act are hereby amended and renumbered
accordingly.
SECTION 12. Repealing Clause. All laws, executive orders, rules and regulations
inconsistent with or contrary to this Act are hereby deemed accordingly repealed or
amended.
SECTION 13. Separability Clause. If, for any reason, any section or provision of this
Act is declared unconstitutional or invalid, the other sections of provisions not affected
thereby shall remail in full force and effect.

259

Laws on Bases Conversion

REVISED AFP MODERNIZATION PROGRAM - Republic Act No. 10349

SECTION 14. Effectivity Clause. This Act shall take effect fifteen (15) days after its
publication in at least two (2) newspapers of national circulation.
Approved,

(Sgd.) JUAN PONCE ENRILE


President of the Senate

(Sgd.) FELICIANO BELMONTE, JR.


Speaker of the
House of Representatives

This Act which is a consolidation of House Bill No. 6410 and Senate Bill No. 3164 was
finally passed by the House of Representatives and the Senate on September 19, 2012.

(Sgd.) EMMA LIRIO-REYES


Secretary of the Senate

(Sgd.) MARILYN B. BARUA-YAP


Secretary General
House of Representatives

Approved: December 11, 2012

(Sgd.) BENIGNO S. AQUINO III


President of the Philippines

Laws on Bases Conversion

260