Maynilad Water Services, Inc.

August 5, 2008 BIR RULING [DA-(IL-012) 110-08] E.O. 226; DA 127-07; 02/28/07 Maynilad Water Services, Inc. Katipunan Road, Balara Quezon City Attention: Arturo Celso D. Baranda SAVP-Controller Gentlemen : This refers to your letter dated July 4, 2008, requesting for the issuance of a Tax Exemption Certificate pursuant to Revenue Regulations No. 2-98, as amended, on account of the registration of Maynilad Water Services, Inc. (Maynilad) with the Board of Investments (BOI) under Executive Order (E.O.) No. 226, otherwise known as the "Omnibus Investments Code of 1987". cDHAaT As represented, Maynilad is duly registered with the BOI per Certificate of Registration No. 91-201 dated January 13, 1998 as "Operator of Water Supply and Sewerage System for the West Zone Area" with pioneer status; that it is entitled to the income tax holiday (ITH) incentive for a period of six (6) years; that the six-year ITH period was amended from August 1, 2001-July 31, 2007 to January 1, 2003-December 31, 2008 per BOI Management Committee Meeting on April 10, 2008 and Board Meeting on April 16, 2008. In reply, please be informed that under Section 2.57.5 (B) (2) of Revenue Regulations No. 2-98, as amended by Revenue Regulations No. 6-2001 implementing Section 57 (B) of the Tax Code of 1997, as amended, the withholding tax prescribed in the said Regulations shall not apply to income payments to persons enjoying exemption from income tax as provided under Republic Act No. 7918 and E.O. No. 226. Accordingly, since Maynilad is a BOI registered enterprise, enjoying exemption from payment of income taxes pursuant to the provisions of Section 39 (a) (1) of the Omnibus Investments Code of 1987, for a period of six (6) years reckoned from January 1, 2003, this Office is of the opinion as it hereby holds, that it is exempt from the payment of the creditable withholding tax imposed under Revenue Regulations No. 2-98, as amended by Revenue Regulations No. 6-2001 on income payments received by it during the specified period in connection with its registered activity. HDIaET 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, Commissioner of Internal Revenue By: (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service