Chevron Holdings, Inc.

August 10, 2007 BIR RULING [DA-444-07] DA 061-04 Chevron Holdings, Inc. Manila Shared Services Center 35th Floor, Yuchengco Tower, RCBC Plaza 6819 Ayala Avenue Makati City Attention: Mr. Kee Teek Hong General Manager Gentlemen : This refers to your letter dated June 19, 2007 stating that Chevron Holdings, Inc. (formerly Caltex [Asia] Limited) (CHI) is a multinational company organized and existing under the laws of Delaware, USA, as a Regional Operating Headquarters (ROHQ) in the Philippines duly registered with the Securities and Exchange Commission (SEC) under SEC Registration No. A199802486; that as stated in its Certificate of Registration and License, the ROHQ shall engage in general administration and planning, business planning and coordination, sourcing and procurement of raw materials and components, corporate finance advisory services, marketing control and sales promotion, training and personnel management, logistic services, research and development services and product development, technical support and maintenance, data processing and communication, and business development; that CHI has 728 regular employees and provides services to affiliates in Asia Pacific, Africa, United Kingdom, Mexico and North America, operating 24 hours a day for five days a week; that specifically, the services performed by CHI to its affiliates pursuant to its registered activities relate to Finance, Human Relations (HR), Information Technology (IT) and Marketing support services; that in order to carry out these functions, CHI has engaged the services of certain Filipinos and foreigners to occupy the following managerial and/or technical positions in the ROHQ: DcCITS I. Manila Downstream Service Center (MDSC) a. MDSC Operations Manager Responsible for the development, maintenance and achievement of Service Level Agreements with various Chevron Affiliates; Develops, recommends and executes internal control, quality control and other policies of the company; Performs over-all oversight, provides direction and manages department/s in the organization; Makes major decision, including the hiring and firing of employees; Facilitates personnel movement, succession planning and career development processes, including recruitment, development and retention of highly qualified personnel; Coordinates with business partners on risks identification, audit programs and resolution of exception items; Ensures continuous improvement in work processes by assessing quality of group's and individual's work; Ensures resolution of both internal and external customer requests, queries and complaints, in order to provide a high level of customer satisfaction, necessary to support the achievement of defined group and company goals. b. MDSC Team Leaders Assist and support Operations Managers in the management of the department; Act as the officers-in-charge in the absence of the Operations Manager; Provide supervision to work group and manage the performance of direct reports in the service center to ensure delivery of service level agreements and key performance requirements of business partners and affiliates; Coordinate and plan with other work groups of affiliate Chevron companies to achieve successful operations support by administering company programs, implementing related company policies and providing expertise on systems and software applications, including SAP and other back office support applications. c. Deputy Team Leaders Assist and support Team Leaders in the management of the work group; Act as the officers-in-charge in the absence of the Team Leader; AHEDaI Develop and prepare team reports, statistical analysis and other monitoring reports to ensure service level agreements are delivered and key performance requirements of business partners and affiliates are met; Coordinate and plan with other team leaders related company policies and provide expertise on systems and software applications, including SAP and other back office support applications. d. Project Implementers Responsible for the documentation and migration of processes from Chevron Affiliates to the ROHQ; Lead in the implementation of special projects/programs, which includes supervision of project team direct reports; Perform over-all oversight of processes assigned; Perform special project assignment; Considered a subject matter expert in at least one company program or work group process; Ensure efficient and effective implementation of the new processes and manage transition activities, including training of new employees on related process details and procedures. e. Business Analyst Responsible for preparing business plans and annual budget; Consolidates scorecards, key performance indicators and analyze reports and make recommendations based on statistic and trends; Writes monthly status reports and publications to affiliates; Prepares cost proposals containing costing for the migration of services in order to provide financial data to support resource allocations decisions; Acts as over-all Sarbanes-Oxley (SOX), compliance and business continuity coordinator. f. MDSC Quality Assurance Specialist Responsible for assessing agents' call handling and case resolution function by monitoring customer contact points via phone, email and related correspondences, utilizing both quality management and case management systems; Follows established quality assurance processes to evaluate, score and document observation and evaluation of quality components including but not limited to verification, correct system actions, and proper documentation; DTIaHE Coordinates with other work groups of affiliated companies to ensure uniform implementation of quality assurance policies. g. MDSC Knowledge Management Specialist Responsible for data maintenance of resolutions in the knowledge management database, refine and define business processes which drive the over-all efficiency and effectiveness of the service center; Participates in strategic planning sessions with other work group of Chevron affiliates to coordinate change management for new and revised processes; Identifies process improvement opportunities and provides feedback, inputs and information on strategic, process, system and policy issues in the service center; Responsible for ensuring that documentation of processes follow standards set by Chevron; Ensures that documentations are created for new and additional processes; Validates that process documentation are kept updated and charges are properly covered. h. MDSC Training Specialist responsible for developing and implementing continuous learning process and training program intended to advance soft skills, cultural, technical and business knowledge; Partners with in-country Human Resources Department and Chevron affiliates to explore best practices, ensures consistency and leverage training gaps that may be encountered; Provides coaching for team members to promote standardized approach in providing service and implementation of programs and policies. i. MDSC Information Technology Specialist Provides business and system analysis and process design expertise to promote efficiency and maximize use of systems and resources; Coordinates with other IT groups of affiliates to manage technology issues; Communicates systems application and/or hardware capabilities to business users and deliver proposals and estimates for both new solutions and modifications; Delivers software implementations, software and hardware upgrades, and modifications to existing functionalities, reports or processes to satisfy business requirements; Involved in scoping, design, hardware sizing, customization, installation, programming, developing reports, unit, integration and user acceptance testing, documentation, master data conversion, security, training and post-live production support activities. cDHAES j. Regional Dispatch Manager Evaluates and maintains the data integrity, processes and functions of an integrated demand forecasting and scheduling tool; Responsible for providing reliable supply to inventory-managed/auto-replenishment customers across the region; Decides on managing unique fluctuations in demand due to pricing strategies, special events and holidays; Responsible for efficient, reliable and safe delivery service to customers requiring manual order processing and optimization; Implements the agreed-upon strategies necessary to optimize fleet operations; Analyzes and develops strategies to resolve delivery issues; Coordinates cross-functional efforts with Supply & Trading, Pricing & Planning, Sales, In-Country Marketing Service Centers, Terminal and Transportation Operations, and Contract Haulers to minimize customer impact while outperforming competition; Manages, motivates and provides work direction to the Logistics Regional Dispatch Center as it schedules contractor and proprietary fleets to ensure optimal efficiencies, utilization, reliability and safe-operations; Develops teamwork, cross-functional skills and builds direct reports' expertise and relationship competencies with internal and external partners; Coordinates with the Manila Downstream Service Center Manager to ensure compliance within the MDSC charter on HR, office and administrative guidelines; Coordinates with Transportation Power Teams in managing transportation performance; Participates in key transportation studies, ensure alignment with scorecard metrics and shares best practices; Monitors fleet performance together with Area Distribution Coordinators and Transportation Supervisors; Provides feedback to Regional Logistics Management on performance. Ensure effectiveness and accuracy of data collection and reporting for key Performance Indicators. k. Delivery Supervisor/Team Leader Ensures that Delivery Coordinators and Data Administrators are meeting their operational commitments on a daily basis; Guides Delivery Coordinators in making operational decisions during times of resource constraints; Participates in day-to-day control of scheduling activities and scheduling support; Manages the Regional Dispatch Center in the absence of the Regional Dispatch Center Manager; cTCADI Represents the Regional Dispatch Center in cross-functional study teams and lead initiatives to improve truck utilization and increase efficiency for identified Terminals/Areas; Finalizes plans (together with the Delivery Coordinators and the FOF Business Analyst) to address demand surges due to special events like price changes, sales promotions, holidays and abnormal weather for the approval of the Regional Dispatch Center Manager; Leads Operational Excellence Programs (safety, RSI prevention) within the Regional Dispatch Center; Monitors training activities of the staff and compliance requirements of the Corporation (e.g. SOX). k. Delivery Coordinator Schedules fuel orders using the standard automated scheduling tool (Aspen Tech) by extracting approved orders from SAP; Fully utilizes proprietary, strategic and core fleets by optimizing truck deliveries and enforcing agreed-upon service levels/internal change strategies; Ensures all products are delivered as committed to the customer; Monitors and forecasts stock position data for auto-replenishment customers (Retail & C & I) using the integrated demand forecasting tool (Aspen Tech); Ensures that these sites never experience product stock-outs or returns and that site inventory levels are optimized and managed; Manages and plans for demand surges due to holidays, sales promotions, price adjustments and other factors by using Aspen and business knowledge to ensure that delivery commitments are met; Coordinates with Customer Service Center and Terminal Staff to address and resolve delivery issues; Analyzes SAP and Aspen system-generated reports on key performance measures; Provides feedback to Area Distribution Coordinators and Transportation Power Teams on fleet performance. l. Retail Systems Compliance Coordinator and Systems Analyst Analyzes, develops, and maintains Enterprise Security Architecture System (ESAS) corporate compliance standards against supported systems. Stay abreast of ESAS changes and as policies, standards and technical controls change, perform reviews and revise procedures as appropriate; TEDAHI Drive compliance, Information Protection and SOX initiatives of the organization; Leverages, applies and shares best practices to supported systems to supplement IP and SOX controls; Leads and participates in other projects within the IM COF BOS Reporting Group as required; Develops and maintains license management procedures and inventory. Ensures that licenses are current and in the correct quantities and that proof is readily available. m. Desktop and Application Support Analyst Manages a standard Back Office & Point of Sale Computer images throughout the Chevron Network; Keeps the Back Office & Point of Sale Computer images current (latest patches applied) and ensure that it supports business and technical requirements. Maintains thorough, accurate and up-to-date documentation relating to the image including configuration and installation instructions; Defines requirements, specifications, policies, standards and best practices for the maintenance of that image through collaboration with the Global Architect, Information Management Center of Focus, Area Marketing Support, Retail and Information Technology Company (ITC); caIDSH Produces updated installation packages for applications included in the Store Operating Environment (SOE) build and produce installation CD-ROMs to distribute to sites; Provides third level technical support for the Back Office & Point of Sale Computer images; Organizes and participates in testing to ensure that the Back Office & Point of Sale Computer images are stable, functional and supports the required applications; Supports implementations to ensure that Information Protection standards and technical controls, SOX controls and processes are adhered to and that the required documentation is created and maintained; Formal and self driven training to build and maintain expertise in new hardware, software and systems. n. Regional Business Analyst (Technical & Implementation) Involves understanding the different retail business needs and problems and then translating them into requirements understandable to the technical analysts and ensures that these requirements are coordinated with the technical team in preparation of functional and technical requirement; IHEAcC Liaises with the software vendors in understanding the different capabilities of the system; Subject matter expert for both technical and operational processes; Provides changes in processes and work-around to come up with appropriate processes for the business; Involved in the different phases of the System Development Life Cycle so that business requirements can be tracked, requirements can be fine-tuned and learning captured; Stays abreast of the different methodologies and best practice in the trade and network with other Business Analyst within the Chevron Network. o. Regional Implementation Trainer/Business Analyst Assesses needs and provides in-country L & D Departments with Train the Trainer type courses on system (Head Office System, Back Office System, Point of Sales System and other systems and platforms Hydra & Triton) solutions including standard processes and other related applications such as Service Desk, Crystal report generator using updated training materials; TcDHSI Communicates constantly with Global product managers, Solutions teams, and global IT vendors to stay involved in the different phases of the Software Development Life Cycle so that the business requirement can be tracked; Provides in country retail team with the necessary training materials and updates; Identifies gaps, issues to improve training and site compliance. If necessary, provides work around or change in process to fit in-country requirements. p. Test & Integration Test Analyst Analyzes issues/defects escalated by the Test & Integration Specialists during the testing phase of the system (Head Office System, Back Office System, Point of Sales System and other systems and platforms Hydra & Triton) being used in the Retail Sites of Chevron; Works in partnership with the different teams (Solutions, Deployment, Vendors, Retail Operations) to derive to a possible work around that will fix the issue/defect encountered by the Test & Integration Team and production; Recommends process improvements or corrections throughout the methodology in order to continuously improve productivity and quality of the system prior to deployment; Designs, executes, and evaluates of test scripts and test plans for new product enhancements, based on requirements by utilizing established quality assurance processes; Participates in the design validation reviews. q. Logistics IT Business Analyst Works in a global virtual team environment and embedded as the business analyst within the Regional Dispatch Center (RDC); Involves understanding the customer's business needs and problems and then translating them into requirements understandable to the technical analysts and the software vendor; Leads testing and roll-out of application upgrades and vendor service packs (patches) at RDC; Works with business to define, test and ensure sustainability of disaster recovery/business resumption plans for RDC. r. Retail Support Team Leader Manages the operations of the ROC Retail Support (Hotline helpdesk) functions and tools which provide the first-level support to the systems being used by the Retail Service Stations (Head Office System, Back Office System, Point of Sales System and other systems and platforms Hydra & Triton); TCIHSa Monitors the resolution of the problem and co-coordinating with the Caltex Retail Service Stations and second or third level support as to the status of the call on a regular basis; Provides in country with daily, weekly and monthly reports on ROC Hotline services to Caltex stores implementation and operation team in all concerned geographical entities; Performs Root Cause Analysis to determine long term solution for recurring issues. s. Regional Project Manager Coordinates and plans system rollouts or version enhancements with local retail automation managers, Retail BU's and local support vendors. Provides project leadership to specific Chevron support teams and turnaround teams; Provides interface with internal audit for Company Owned Company Operated (COCO) compliance, standards and store level Operational Excellence (OE), including Business continuity Plans; Leads Caltex Retail Automation in-country management teams in planning and executing information system solution implementation for assigned Caltex country. Liaises and advises Area Marketing Support leaders to assist planning and support for their in-country priorities; Provides technical and operational expertise to review and assess test results and vendor Patch Analysis Documents; Liaises with Global IT vendors and product owners on critical paths; Provides expertise to Solution teams planning, product assessment and review committees for Asia Pacific (APAC); Proposes new information management solutions and enhancements; Creates and monitors required system change requests and deployment agreements for supported countries and projects. t. Systems Team Lead Leads and co-ordinates the production technical support of the systems (Head Office System, Back Office System, Point of Sales System and other systems and platforms Hydra & Triton) deployed in retail stations at Singapore, Hong Kong, South Africa, Thailand, Cambodia and the Philippines, liaising with the vendor as necessary; Works with Fiscal, Merchandising, Retail Automation, IT, Deployment and Area Marketing Support to resolve Back Office (BOS) and Head Office (HOS) issues; HEDSCc Keeps abreast of Enterprise Security and Architecture System (ESAS) and SOX changes. Ensure that the Head Office is in compliance with ESAS policies, standards and technical controls and it is in compliance with Sarbanes Oxley (SOX) controls and that proper documentation and evidence exists. Work with the Retail Systems Compliance Coordinator and other coordinators as necessary; Ensures that system configurations, installation documents, maintenance procedures and system administration procedures and other such system documentation are properly documented and kept current; Supports the Information Management Center of Focus Test & Integration lab activities through the provision of expertise, technical support, trouble-shooting and analysis of bugs and enhancements. II. Finance Shared Services a. Finance Managers responsible for the development, maintenance and achievement of Service Level Agreements with Customers (Chevron Affiliates e.g. Asia Pacific and US); Develops, recommends and executes internal control and other policies of the company; Performs over-all oversight, provides direction and manages department(s) in the organization; Decides on major decisions, including the hiring and firing of employees; Facilitates personnel movement, succession planning and career development processes including recruitment, development and retention of highly qualified personnel; Coordinates with internal/external auditors on risks identification, audit programs and schedule towards resolution of exception items. b. Finance Team Leaders Assist and support Finance Department Managers in the management of the department; Act as the officer in charge in the absence of the Finance Department Manager; Provide direction to accountants and manage the performance of direct reports in Finance; Supervise Finance sub-teams responsible for service delivery to various affiliates (in Asia Pacific, US, etc.). c. Project Implementers (Optimization Associates)/Experienced Accountants Responsible for the documentation and migration of processes from Chevron Affiliates to the Shared Service Center; SHCaEA Take the lead in the implementation of special projects/programs; Perform over-all oversight of process assigned; Perform special project assignment; Considered subject matter experts in at least one Finance function. d. Compliance Coordinators Drive compliance and SOX initiatives of the organization; Conduct compliance trainings to other members of the team; Considered subject matter experts in compliance policies; Take the lead in the achievement of ISO certification; Considered subject matter experts in at least one Finance function; Perform over-all oversight of process assigned. III. Human Resources a. HR Manager Responsible to the leaders of Chevron's Manila Shared Services Center for reviewing and approving HR matters of policy, objectives, strategies, plans and programs affecting the various aspects of Company operations; The job involves management responsibility and overall administration of all HR systems, which include managing succession planning and development, talent identification, selection and retention, organization development, performance management, employee relations, and compensation and benefits programs. b. HR Operations Manager Responsible for the strategic oversight of the Manila HR Shared Services Operations. This includes the development, maintenance and achievement of Service Level Agreements with Customers (Chevron Affiliates e.g., Africa Asia Pacific); Manages with stakeholders any agreements of migration of work to the HR Service Center; Ensures the Service Center is operating in accordance with the Global Shared Service Principals; Develops, recommends and executes internal control (e.g. SOX, OEMS, etc.) and other policies of the company; Performs over-all oversight, provides direction and manages all HR Shared Service teams in the Manila HR Shared Service Center; Decides on major issues, including the hiring and firing of employees; Facilitates personnel movement, succession planning and career development processes including recruitment, development and retention of highly qualified personnel. AHcaDC c. Regional Expatriate Counselor Provides regional counsel on the interpretation and administration of expatriate policies during pre-assignment, on assignment and repatriation to expatriate employees; Provides guidance on global expatriate policies and procedures to Management, HR Business Partners, and in-country HR (home and host HR); Reviews and transmits the Job Offer Package for Resident, Temporary and Rotational Assignments to concerned parties; Coordinates expatriate movement and notification requirements with concerned home country HR, host country HR, Manila Shared Services Center (MSSC) Administrator, and third party providers; Recommends and counsels on exceptions to the global expatriate policy; Ensures that the administration of the expatriate services (i.e., including coordinating the move to the region, administering services during the expatriate's assignment and assisting in the repatriation or re-assignment of the employee at the end of the term) are carried out in accordance to policies and guidelines, and are applied in a consistent and standardized manner across the region; Provides back-up support in performing monthly payroll for the entire expatriate population; Manages performance of team members through setting of goals, monitoring of performance, providing upfront feedback and mentoring; d. Regional Human Resource Information Manager (HRIM) Supervisor/Team Lead Partners with Human Resource Information Manager (HRIM) to develop strategies and priorities, provide oversight of Human Resource Data initiatives regionally; Oversees highly complex projects involving multiple technologies with numerous organizations; Provides oversight of operations at the regional HRIM level; coordinates with Regional Audits and Metrics Personnel Data Maintainers to drive operational and process improvements in Human Resource Data; Coordinates with other Regional Supervisors and Team Leads to align processes globally; Provides Organization Data Analyst and Personnel Data Maintainer Leads with guidance to handle complex problems involving Human Resource data; Serves a primary role in the ongoing career development and training of Organization Data Analyst and Personnel Data Maintainer Leads; holds performance management (PMP) responsibilities for direct reports. e. HR Team Leader Assists and supports HR Manager and HR Operations Manager in the management of the department; Acts as the officer in charge in the absence of the HR Manager or HR Operations Manager; Provides direction to HR Associates and manages the performance of direct reports in HR; Supervises HR sub-teams responsible for service delivery to various Asia Pacific and/or US affiliates. f. Organizational Data Analyst Lead Directs the day-to-day activities of Organizational Data Analysts; Manages the organizational architecture in SAP HR Data for all of the Chevron operating companies and ensures that the reporting structures follows systematical hierarchy; Establishes and maintains organizational design for all designated businesses in SAP (Implementing large reorganizations, position changes, cost center changes, etc.); Provides HR SAP subject matter expertise to HR General Managers, Business Partners, and Shared Services; Provides analysis and testing support for security roles, supervisory skills, mentoring and staff motivation. g. Business Partner Responsible for designing, implementing and/or recommending improvements on the areas of Strategic Staffing, Compensation & Rewards, Communication and Organizational Capability Programs of Manila Shared Service Center; Contributes to the development and accomplishment of the organization wide business plan and objectives by developing the organization development objectives; Serves as the overall HR point person of assigned Team account/s to ensure that HR needs are addressed in an efficient, timely and accurate manner; Acts as advisor, consultant and facilitator in developing and implementing HR strategies, programs and initiatives that would help in achieving team/business unit goals through optimal use and development of the organization's human capital resources. h. Organizational Data Analyst Establishes and maintains organizational design for all designated businesses in SAP (Implementing large reorganizations, position changes, cost center changes, etc.); Services as an escalation point for Personnel Data Maintainers; Provides ad hoc training; Provides analytical and HR SAP subject matter expertise to HR General Managers, HR Business Partners, and HR Shared Services; Provides analysis and testing support for security roles; Provides support to line managers and HR Business Partners for front-end transaction request tools (Olympic Form Tool and Manager Desktop). i. Regional Reporting Analyst Prepares and generates complex ad hoc SAP R/3 and Business Warehouse Reports for the AAP Region; Provides technical support on regional reporting to HR customers; Coordinates with the Global Reporting Team to address Level 2 Reporting support requests and reporting policy concerns; Assesses issues and determines when to escalate infrastructure support to IT; Escalates issues appropriately to the Human Resource Information Management Team Lead. j. Regional Metrics and Audits Analyst Generates pre-defined and ad hoc SAP HR audit reports that are region-specific; Conducts audits of regional third-part vendors; Collects metrics measurements and procedures comparison reports against Human Resource Information Management (HRIM) performance standards; Coordinates with the Global Audits and Metrics team to conduct local data clean-up activities or root cause determination on the global issues; Synthesizes audit and metrics information to detect deficient controls, duplicated effort and non-compliance with laws, regulations and Chevron policy; Provides Organization Data Analyst (ODA) and Personnel Data Maintainer (PDM) Leads examples for ongoing training for ODAs and PDMs; Escalates issues appropriately to the HRIM Team Lead. k. Customer Relationship Management (CRM) Associate Facilitates and supports the development, implementation and evaluation of customer relationship and service strategy approaches, programs and tools for Africa Asia Pacific HR Shared Services; Prepares the Customer Service Reports for the region; Closely monitors and supports implementation of service improvements in conjunction with the Leadership Team; Monitors, channels and supports solicitation of Customer Feedback; HaTSDA Prepares service performance and scorecard reports (quarterly and annually). Represents MSSC HR Manila Shared Services in customer meetings and hosts customer visits; Identifies and communicates to Africa Asia Pacific HR Shared Services relevant research on best practices and benchmarking studies-both within the outside Chevron; Supports improvement in service quality, cost, efficiency, by assessing, monitoring the Region's performance metrics and communicating as necessary; Releases regional Customer Advisories on major HR announcements. l. Planning & Projects Coordinator Facilitates and drives the development of the annual Africa Asia Pacific Regional Shared Services Strategic Business Plan, and ensures alignment with Corporate HR Shared Services Strategic Business Plan. Reviews budget and service offerings for alignment with core initiatives. Determines interdependencies with other Shared Services organizations. Develops, coordinates and provides various budget/financial reports to management and Corporate HR and ad hoc groups regarding operating expenses, head count and CAPEX-year-to-date and forecast numbers. Monitors cost recoveries of budget against plan monthly-conduct ad-hoc billing as necessary. Responsible for the deployment of Operational Excellence in Africa Asia Pacific Regional Shared Services. IV. Information Technology (IT Professionals) a. Application Delivery Deliver global Information Technology enabled business systems/solutions like ERP applications: SAP, JDEdwards/Oracle Enterprise 1 and Ariba, Internet Web Based applications, and proprietary Chevron Applications; Provide the following services: business analysis, design, technical development, selection, purchase, implementation, integration, support and maintenance. Develop the technology architecture and implementation of strategy to ensure that application designs align with the technical and business environments; Collaborate with global customers, gathering and modeling business data, business processes and rules to ensure that the chosen solution meets objectives; Apply Information Protection Standards, define and design application functional and end-user interface requirements, develop test cases and plans, run system testing, conduct testing validation, and lead the development of application documentation and customer training; Create technical solutions to meet business needs by performing program design, application integration, implementation and testing. This also includes updating, repairing, modifying, and expanding existing programs due to changes integrated systems; DHECac Log and monitor user issues in the customer service systems and serves as the first level of application support; Manage monthly reporting of IT Professional's Service Level Agreements, SLA, and responsible for reports relating to customer relationship management. This includes but is not limited to the following roles: Application Architecture, Business Analysis, Programming, System Analysis, Integration and Service Desk; This job family also includes Managers and Team Leaders that set strategic direction, establish annual business plans in collaboration with business owners, and direct day-to-day operations to the above roles. b. Consulting and Project Management Deliver IT project management, business and technical consulting expertise for the global IT function; Responsible for assembly of project teams, management of project budgets, schedules, development methodology, deliverable definition, as well as the appropriate application of the principles, practices, and processes for IT; Identify and define business opportunities and lead the development and implementation of IT solutions that meet business needs; Frequently engage the business units to understand business strategies and opportunities for IT enabled solutions; Use project management tools to ensure quality results for project planning and deployment, as well as change management activities. Consulting expertise includes working with customers and technical experts to develop viable solutions, as well as to recommend tools and technologies that solve business problems and improve business processes; Provide professional advice regarding linking appropriate technology solutions for the business problem in which they are being engaged; Partner with customers and applies governance principles to potential solutions in order to ensure deployment of resources to solutions with most favorable impact to the enterprise; Includes (but is not limited) the following roles: Project Management, Change Management and Solution Consulting; This job family also includes Managers and Team Leaders that set strategic direction, establish annual business plans in collaboration with business owners, and direct day-to-day operations to the above roles. c. Data and Information Management Deliver the analysis, design, consulting, selection, implementation and support of database, business intelligence technologies, and content management solutions which are globally accessible and reliable; Provide expertise to properly organize, manage, protect, communicate and leverage information assets. This includes both structured (e.g., databases, transactions, application data, etc.) and unstructured (e.g., documents, presentations, web pages, images, email, voice, etc.) information assets; Perform application database/data warehouse creation and support, which includes database/data warehouse object creation, security management, maintenance and monitoring, migration, performance and tuning, reporting, benchmarking, sizing/space management, troubleshooting, and on-going database/data warehouse problem resolution; Collaborate with customers to analyze and validate business data requirements and data sources in order to create logical and physical database/data warehouse designs and ensures interoperability of applications with the database/data warehouse/middleware environment; HEDSCc Develop and execute ad hoc queries, data loads, data import and export for the data warehouse, as well as provides data warehouse Extract, Transformation and Load development support; Provide standards and guidelines for implementation of corporate policy compliance for database/data warehouse technical control requirements (e.g., Information Protection, Sarbanes-Oxley Laws, Bureau of Revenue Laws, etc.); Identify, gather, evaluate, organize, maintain access, retrieve, protect, preserve and dispose of information assets based on company retention schedules in conformance to international laws. It includes but is not limited to the following roles: Application Database Administration, Data Analysis and Database Design, Data Flow/Transformation Support, Database Architecture, Information Architecture, Information Design, Information Management Support and System Database Administration; This job family also includes Managers and Team Leaders that set strategic direction, establish annual business plans in collaboration with business owners, and direct day-to-day operations to the above roles. ATcEDS d. Desktop and Server Deliver architecture, design, implementation and support of IT server solutions which are flexible, reliable and scalable across Chevron and end-user computing devices, such as: PCs, Blackberries, network printers, scanners and document management systems; Develop the technology architecture for the desktop/workstation and server environment ensuring the infrastructure designs align with the technical, security, and business environment; Evaluate new & emerging technologies in order to develop and promote the strategy and direction for desktop/workstation and server Infrastructure; Develop strategies for optimizing reliability, performance, and interoperability of systems and integration of processes which anticipate and meet the business direction; Responsible for ensuring quality assurance, change acceptance testing, and release management practices to minimize any negative business impact; Perform installations, maintenance and troubleshooting of hardware and software in the end-user environment; Manage the problem management process, including problem and error control root cause determination, proactive problem prevention, trend analysis, management of metrics, and problem review processes; Perform operations activities associated with the management of the server infrastructure, which includes: access control, security compliance, backup and recovery, maintenance, monitoring, migrations, performance tuning, reporting, benchmarking, storage, and capacity management. It includes but is not limited to the following roles: Desktop/Workstation and Server Architecture, Desktop/Workstation and Server Infrastructure Change Management, Desktop/Workstation and Server Infrastructure Design, Desktop/Workstation and Server Infrastructure Problem Management, Desktop/Workstation System Administration, End User Environment Support, Server Infrastructure Administration, Server Infrastructure Design and Server Infrastructure Problem Management; This job family also includes Managers and Team Leaders that set strategic direction, establish annual business plans in collaboration with business owners, and direct day-to-day operations to the above roles. e. Information Technology Business Management Provide business management for the delivery of information technology products and services including: management of business plans, budgets, portfolios, product plans, customer relationship management, supplier relationships, contracts, cost recovery, information protection and compliance and standards, as well as the evaluation of IT services. Establishes effective partnerships with the business customers in order to understand their goals, strategies and processes and how IT can be effectively applied in realizing their business plans; CcaASE Develop and manage the processes, timing and tools used to manage IT Products and Services; Provide business, technology requirements, and planning coordination for IT Products and Services; Manage the product life cycle from commercialization of new products, through the product life-cycle including eventual elimination of a product offering when appropriate; Manage business and contractual relationships with external suppliers of IT products and services; Translate customer requirements into specifications for sourcing efforts and ensures that the chosen solution meets customer objectives; Develop continuous contract improvement processes and manage benchmarking and metrics development. It includes but is not limited to the following roles: Customer Relationship Management, Product Management, and Strategic Sourcing; This job family also includes Managers and Team Leaders that set strategic direction, establish annual business plans in collaboration with business owners, and direct day-to-day operations to the above roles. f. Network Infrastructure Deliver the analysis, implementation and global support for voice and data connectivity in Chevron. This includes network, radio, telephone, satellite and microwave technologies. Designs the security aspects of Chevron's network, including firewalls, intrusion detection devises, RAS and VPN services to ensure compliance with global standards (e.g., International Law pertaining to Information asset management); Develop the framework, standards and general design of network access and security. Provide network intrusion detection, host based intrusion detection, and incident response; Provide investigation and computer forensic services for suspected cases of inappropriate computer usage; Develop the technology architecture for the network & telecommunications infrastructure environment ensuring the infrastructure designs align with the technical, security, and business environment; Design, configure and manage implementation of network (LAN/WAN) systems in compliance with corporate standards; CADHcI Design, configure and manage implementation of radio frequency systems (e.g., radio, microwave, satellite, and other wireless technologies) in compliance with corporate standards; Design, configure and manage implementation of telephony systems (PBX, KSU, Traffic analysis, signaling systems, IP telephony, voicemail, Call Detail Reporting Systems) in compliance with corporate standards; Provide 1st and 2nd level support for monitoring, fault diagnosis, performance tuning/management of the telephony network. Included, but not limited to the following roles: Network Access and Security Engineering & Monitoring, Network Access Security Support, Network Architecture, Engineering and Support, Radio Frequency Network Engineering & Support, Voice System Engineering and Support; This job family includes Managers and Team Leaders that set strategic direction, establish annual business plans in collaboration with business owners, and direct day-to-day operations to the above roles. g. Strategy, Technology Planning and Architecture Deliver global planning and coordination for the development and implementation of technology strategies in response to changes in the internal or external environment; Provide the expertise for the global design and development of technology standards and architecture for the enterprise. The strategies, technology standards and architecture are in alignment with and contribute to the success of the strategic intents of Chevron and its business units; Lead engagements with business and IT leaders to understand and document business strategies, key performance indicators and how they apply to IT asset investments (primarily applications and data leading to infrastructure); Assess global IT industry technology and capabilities; Identify trends or general directions in these capabilities; Collaborate with subject matter experts in the IT industry to discuss new technologies to increase awareness of new developments, to better understand emerging technology trends, and to understand the application of recent new technologies and their impact on enabling competitive edge business performance. It includes but is not limited to the following roles: Enterprise Architecture, IT Strategy, Business Case Analysis, and Technology Trend Analysis; This job family also includes Managers and Team Leaders that set strategic direction, establish annual business plans in collaboration with business owners, and direct day-to-day operations to the above roles. that the above positions require technical proficiency in accounting, IT, Finance, various business/financial systems or software and the interrelationships thereof, business process risks and controls, process implementations, among others; that certain positions likewise require deep analytical and leadership skills, and the exercise of initiative to drive work direction to team members; that these managerial and/or technical employees perform work that is not merely routinary or clerical, but their positions require the exercise of discretion and judgment within their respective groups or departments; and that due to the technical nature of the petroleum industry, such employees are also required to have extensive knowledge and experience in the overall business of Chevron and the regulatory functions that apply to it globally. Based on the foregoing representations, you now request confirmation of your opinion that 1. The Filipino and foreign managers and/or technical personnel of CHI, which is registered as an ROHQ in the Philippines, are entitled to the 15% preferential tax rate provided under Section 25 (3) (c) of the Tax Code of 1997, in relation to Republic Act (R.A.) No. 8756; and 2. The CHI Filipino employees have the option to be taxed at either fifteen percent (15%) of their gross income or the regular tax rate based on their taxable income, regardless of whether there is an alien similarly occupying such technical or managerial positions. In reply thereto, please be informed that Section 25 (C) of the Tax Code of 1997, reads: "(C) Alien individual Employed by Regional or Area Headquarters and Regional Operating Headquarters of Multinational Companies . There shall be levied, collected and paid for each taxable year upon the gross income received by every alien individual employed by regional or area headquarters and regional operating headquarters established in the Philippines by multinational companies as salaries, wages, annuities, compensation, remuneration and other emoluments, such as honoraria and allowances, from such regional or area headquarters and regional operating headquarters, a tax equal to fifteen percent (15%) of such gross income: Provided, however, that the same tax treatment shall apply to Filipinos employed and occupying the same position as those of aliens employed by these multinational companies . . ." In relation therewith, Article 61 of R.A. No. 8756 provides "Art. 61. Withholding Tax of 15% on Compensation Income . Aliens employed by the regional or area headquarters and regional operating headquarters of multinational companies shall be subject for each taxable year upon their gross income received as salaries, wages, annuities, compensations, remuneration and emoluments to a tax equal to fifteen percent (15%) of such gross income. The same tax treatment is applicable to Filipinos employed and occupying the same positions as those aliens employed by multinational companies: Provided, That said Filipinos shall have the option to be taxed at either 15% of gross income or at the regular rate tax on their taxable income in accordance with the National Internal Revenue Code." TAIEcS Corollarily, Section 2.57.1 (D) of Revenue Regulations No. 2-98, as amended by Revenue Regulations No. 6-2001, and as further amended by Revenue Regulations No. 12-2001 and Section 10 of the Rules and Regulations Implementing Article 61 of R.A. No. 8756 provide that alien executives occupying managerial and technical positions employed by the regional or area headquarters and regional operating headquarters of multinational companies shall be subject for each taxable year upon their gross income received as salaries, wages, annuities, compensation, remuneration and emoluments to a final tax equal to fifteen percent (15%) of such gross income and that the same tax treatment is applicable to Filipinos employed and occupying the same positions as those aliens, regardless of whether or not there is an alien executive occupying the same position. However, qualified Filipino employees shall have the option to be taxed at either 15% of gross income or at the regular tax rate on their taxable income in accordance with the Tax Code of 1997. In case of the latter, the withholding tax rates under Sections 2.78 and 2.79 of Revenue Regulations No. 2-98 shall apply. In stressing the above-cited provisions, this Office elucidated the matter in BIR Ruling No. DA061-04 dated February 12, 2004 , as follows: ". . . since the positions of the CSPHL-ROHQ personnel enumerated above clearly require technical proficiency and initiative from the individuals occupying such position, hence, this Office holds that such employees shall be subject to either the preferential tax rate of 15% or to the regular tax rate based on their taxable income, regardless of whether there is an alien similarly occupying such technical or managerial positions. (BIR Ruling No. 118-2003 dated April 14, 2003)" IN VIEW OF THE FOREGOING, this Office hereby confirms your opinion that 1. The Filipino and foreign managers and/or technical personnel of Chevron Holdings, Inc. (CHI), which is registered as an ROHQ in the Philippines, are entitled to the 15% preferential tax rate provided under Section 25 (C) of the Tax Code of 1997, in relation to R.A. No. 8756; and 2. The CHI Filipino employees have the option to be taxed at either fifteen percent (15%) of their gross income or the regular tax rate based on their taxable income, regardless of whether there is an alien similarly occupying such technical or managerial positions. 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