Preferred and Pioneer Areas of Investment.
Section 18
SEC. 18. Preferred and Pioneer Areas of Investment.— Within one hundred twenty (120) days after its organization and not later than the end of January of every year thereafter, the Board of Investments shall submit to the President, through the National Economic Council, an Investments Priorities Plan as defined in Section three, paragraph (k) of this Act. In determining the preferred and pioneer areas of investment and their corresponding measured capacities, the Board shall determine which areas of investment best accomplish the policy declared in this Act, including those which will economically produce goods for domestic use in substitution for goods being imported In large quantities, and especially those which will process further and thereby increase the value of agricultural, mining and timber products already being produced for export or which will make products at costs low enough to be sold competitively in export markets. Any area of investment where an enterprise: (1) Is engaged in the exportation of finished products completely processed and manufactured in the Philippines with at least seventy (70%) per cent of the peso value of its total raw material content being Philippine raw material; (2) is exporting more than fifty (50%) per cent of its total production; and (3) does not enjoy any preferential treatment arising from any agreement or arrangement between the Philippine government and the importing country; shall be considered a preferred area of investment and included in the Investment Priorities Plan. The Board shall take into account all the following criteria: (a)The gaps between prospective demand and existing supply for specific products, commodities and services, and the additional production capacities that must be induced where such gaps exist; (b)The potential of such areas of investments for creating new markets both domestic and foreign, for domestic suppliers of raw materials and/or intermediate goods, or new sources of supply for domestic consumers of the products; (c)The potential of such areas of investment for creating productive employment, considering the necessity for the dispersal of industries in the country on a planned and balanced basis to the extent that Is economically feasible and practicable; (d)The extent to which investment in such areas will integrate existing production, facilities; (e)The amounts of import substitution or of new exports such areas of investment will promote; (f)The amount of capital normally needed thereby; (g)The nature of the risks, commercial or otherwise, which may be entailed; (h)The proportion of the required capital, raw material and labor inputs ox indigenous origin; (i)The rate of profitability; (j)The rate of return to the economy; (k)The maintenance of competition; and (l)Such other criteria as the Board may adopt. Considering the amount of Investment capital which the Board may estimate to be available during any given year, the Board shall give priority to projects with the highest rates of return to the national economy. No project shall be included in the Investment Priorities Plan, nor declared a preferred area of investment, nor designated a pioneer area, unless it is shown to be economically, technically and financially sound after thorough investigation and analysis by the Board. In any of the areas declared preferred areas of investment, the Board may designate as pioneer areas the specific products and commodities that meet the requirements of Section three, paragraph (h) of this Act. The National Economic Council, within sixty (60) days from receipt of the plan from the Board, shall evaluate and submit the same, with its' recommendation on the entire plan or portions of it, to the President for his approval. If the National Economic Council fails to act on the plan within the said period of sixty (60) days, it shall automatically be submitted to the President for approval. Upon approval, the President shall proclaim the whole or part of such plan as in effect; or alternatively, return the whole or part of the plan to the Board of Investments for revision. Portions not returned to the Board of Investments shall be proclaimed in effect. Upon the effectivity of the plan or portions thereof, the President shall issue all necessary directives to all departments, bureaus, agencies and instrumentalities of the government to ensure the implementation of the plan by the agencies concerned in a synchronized and integrated manner. No government body shall adopt any policy or take any course of action contrary to or inconsistent with the plan. The Board of Investments may, after notice and public hearing, amend the whole or any part of the plan, alter any of the terms of the declaration of an investment area, or the designation of measured capacities, or terminate the status of preference or pioneer: Provided, That in all such cases the procedures outlined in this section are observed to the extent that they are applicable. In no case, however, shall any amendment of the plan impair whatever rights may have already been legally vested in qualified enterprises which shall continue to enjoy such rights to the full extent allowed under this Act. The Board shall not accept applications in an area of investment prior to the approval of the same as a preferred or pioneer area by the President nor after approval of its deletion as a preferred or pioneer area of investment. Upon approval of the plan, in whole or in part, or upon approval of an amendment thereof, the plan or the amendment, specifying and declaring the preferred and pioneer areas of investment and their corresponding measured capacity shall be published in the Official Gazette and in at least two newspapers of general circulation, and all such areas shall be open for application until publication of an amendment or deletion thereof, or until the Board approves registration of enterprises which fill the measured capacity.