Turbomeca Asia Pacific Philippines Regional Headquarter

July 27, 2007 BIR RULING [DA-416-07] DA 038-04 Turbomeca Asia Pacific Philippines Regional Headquarter PADC Hangar No. 2 Manila Domestic Airport Pasay City Attention: Ms. Maureen Aldea S. Rayos Administration Officer Gentlemen : This refers to your letter dated April 11, 2007 requesting for a certificate of exemption from the value-added tax (VAT) pursuant to Republic Act (R.A.) No. 8756. It is represented that TURBOMECA Asia Pacific Pte Ltd. (TURBOMECA) is a multinational company organized and existing under the laws of Singapore; that on April 21, 1997 it has filed with the Securities and Exchange Commission (SEC) for the establishment of a regional or area headquarters in the Philippines; that its main objective is to place more resources closer to operators in the field and make the entire Turbomeca organization more responsive to their needs; that it acts as a supervisory communication and coordinating center for its affiliates in the region; and that TURBOMECA has two (2) employees, supports approximately 47 engines and over 38 customers in the Philippines. In reply thereto, please be informed that services rendered by regional or area headquarters in the Philippines by multinational companies which act as supervisory, communications and coordinating center for their affiliates, subsidiaries or branches in the Asia-Pacific Region and do not earn or derive income from the Philippines are exempted from VAT pursuant to Section 4.109-1 (B) (j) of Revenue Regulations No. 16-2005, implementing (R.A.) No. 9337 in relation to R.A. No. 8756. TSacID SUCH BEING THE CASE, since TURBOMECA is a regional headquarters in the Philippines of Turbomeca Asia Pacific Pte. Ltd. of Singapore, TURBOMECA is exempt from VAT provided that it merely acts as a supervisory, communications and coordinating center for its affiliates, subsidiaries or branches in the Asia-Pacific Region and provided further that it does not earn or derive income in the Philippines. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service