Foreign chambers back investment law changes
Credit to Author: The Manila Times| Date: Mon, 28 Jan 2019 16:20:28 +0000
Foreign business chambers have expressed support for legislative moves to amend the Foreign Investment Act of 1991 (FIA) with regard to the entry of foreign professionals and requirements for full ownership of domestic firms.
In a statement dated January 24 but only sent to reporters on Monday, the Joint Foreign Chambers of the Philippines (JFC) called for the approval of all amendments contained in Senate Bill 2102 that is being deliberated by the chamber’s economic affairs committee.
SB 2012, introduced by Senator Sherwin Gatchalian last November, seeks to exclude the “practice of all professions” from coverage of the FIA and reduce the employment threshold for foreigners investing in small and medium-sized companies.
“It is our view that the practice of all professions is not a germane provision in the Foreign Investment Negative List (FINL), the key document created by the Foreign Investment Act,” the JFC said.
“The practice of profession is not an investment activity under the scope of the Foreign Investment Act and therefore should not be included in the FINL,” it added.
While the Constitution is biased in favor of Filipinos it is not a strict legal barrier, the JFC said, adding that almost all laws regulating professions also contain reciprocity provisions.
Including professions in the FINL was “extremely misleading”, the JFC claimed.
With regard to ownership, it noted that the FIA set an employment requirement of 50 workers for an enterprise with a minimum investment of $100,000 or a little over P5.4 million.
The amount today, it said, is not enough to support a workforce of 50 as minimum wages have more than tripled.
“So as not to render pointless this provision of the law, and to align it with the spirit of the FlA, there is a need to reduce the employment requirement and lower the threshold to a more reasonable number, which the bill recommends to be 15 employees,” the JFC said.
It also noted that SB 2102 amends the law’s declaration of policy, clarifying the benefits from foreign investments.
Section 5 of the bill, meanwhile, “embodies a long-standing JFC recommendation to undertake systematic inter-agency review of FINL.”
Also, a new provision calls for the establishment of a joint web portal that will carry information regarding investment policies, programs and procedures.
The JFC is comprised of the American, Australia-New Zealand, Canadian, European, Japanese and Korean business chambers in the Phillipines and the Philippine Association of Multinational Companies Regional Headquarters Inc.
FROM A REPORT BY TYRONE JASPER C. PIAD
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