Power to Issue Bonds or Incur Indebtedness.
Section 19
SEC. 19. Power to Issue Bonds or Incur Indebtedness. — Whenever the Board may deem it advisable and necessary for the Authority to contract loans, credits and other indebtedness, or lo issue bonds, notes, debentures, securities and other instruments of indebtedness for the development and/or operation of the Zone, it shall by resolution so manifest and declare stating the purpose for which the indebtedness is to be applied and citing the project study devised for the purpose. In order for such resolution to be valid, it shall be passed by the affirmative vote of at least four members of such Board and approved by the President of the Philippines upon the recommendation of the Secretary of Finance, after consultation with the National Economic Development Authority and the Monetary Board of the Central Bank. The total principal domestic indebtedness of the Authority payable in Philippine currency shall not at any one time exceed three hundred million pesos, while the total principal indebtedness of the Authority payable in foreign currency shall not at any one time exceed one hundred million United States dollars or the equivalent thereof in other foreign currencies qualified to form part of the international reserves of the Central Bank: Provided, That such foreign indebtedness may be contracted from foreign governments or any public or private international banking and financial institution or fund sources. The bonds and other instruments of indebtedness which the Authority is authorized to issue under this section and any income derived therefrom shall, except those contracted with private international banking and financial institution, be exempt from the payment of all taxes of whatever kind and nature including withholding taxes imposed by the Republic of the Philippines, its agencies, instrumentalities or political subdivisions, which fact may be expressed on the ace thereof, and shall be eligible as collateral in any transaction with the national or any local government, its agencies and instrumentalities, including government-owned or controlled corporations and government banking and financial institutions, in which collateral is required. Any or all loans or instruments of indebtedness which the Authority is authorized to contract or issue under this section shall be unconditionally guaranteed both as to principal and interest by the Government of the Republic of the Philippines whenever the President of the Philippines, by himself or through his duly authorized representative, may deem such guarantee by the Government of the Republic of the Philippines to be advisable and necessary, in which case, the President of the Philippines or his duly authorized representative is hereby authorized to execute and deliver said guarantee of the Government of the Republic of the Philippines. The Central Bank of the Philippines or any of its authorized agent banks shall extend to the Authority priority in the allocation of foreign exchange and in the availment of the assistance and resources of the Central Bank in a manner that shall facilitate the contracting or issuance by the Authority of the loans or instruments of indebtedness which the Authority is authorized to contract or issue under this section or the repayment thereof. In any case, where the Authority is required to surrender or sell to the Central Bank foreign currencies qualified to form part of its international reserves, the Authority is hereby given the right to repurchase any or all of said foreign currencies as is necessary to meet all items of debt service arising out of any and all loans and instruments of indebtedness payable in foreign currency contracted or issued by it pursuant to this section at the same rate or rates at which said foreign currencies were respectively sold to the latter, subject to the payment of foreign exchange premium or fees as the Central Bank may deem reasonable. In the negotiation, contracting and issuance of any loan, credit and evidence of indebtedness under, this section, the President of the Philippines may, if deemed by him upon recommendation of the Authority, to be necessary or justified and when made a condition by the foreign creditor to the issuance of such loans, credits, or instruments or indebtedness, agree to waive the application of any law granting preference or imposing restrictions on international competitive bidding, such as, but not limited to, Act Numbered Forty-two hundred thirty-nine, Commonwealth Act Numbered One hundred thirty-eight, Commonwealth Act Numbered Five Hundred forty-one, Republic Act Numbered Nine Hundred twelve, Republic Act Numbered Fifty-one hundred eighty-three: Provided, however, That in every case where competitive bidding is agreed upon in the purchase of machineries, equipment, materials and supplies financed out of proceeds of such loans, credits and instruments of indebtedness, preference may be granted in favor of such machineries, equipment, materials and supplies produced, processed or manufactured in the Philippines at such rate and in such manner as may be agreed upon from time to time with the entity or institution providing financing for the project.