ThyssenKrupp AG Representative Office Philippines

September 12, 2008 BIR RULING [DA-(IL-023) 210-08] DA008-05 ThyssenKrupp AG Representative Office Philippines 220/F Pacific Star Building Sen. Gil Puyat Avenue corner Makati Avenue Makati City Attention: Mr. Helmut F. Bolt Group Representative Gentlemen : This refers to your letter dated August 21, 2008 requesting tax exemption of ThyssenKrupp AG Representative Office Philippines (formerly Fried Krupp AG Hoesch Krupp) as a regional or area headquarter. It is represented that ThyssenKrupp AG Representative Office Philippines is a multinational company organized and existing under the Laws of Germany; that it is a regional area headquarter established in the Philippines under Executive Order (E.O.) No. 226, otherwise known as the Investments Code of 1987, as amended by Republic Act (R.A.) No. 8756. In reply thereto, please be informed that paragraph (E) Section 14 of the Rules and Regulations implementing R.A. No. 8756, amending E.O. No. 226, provides that: "Section 14. Value-Added Tax. Regional or area headquarters shall be exempted from the value-added tax. The sale or lease of goods and property and the rendition of services to regional or area headquarters shall be subject to zero percent (0%) VAT rate as provided for in the National Internal Revenue Code, as amended." Since ThyssenKrupp AG Representative Office Philippines has been granted tax exemption privileges based on its status as a regional or area headquarters by the Board of Investments, the sale of goods, property and services to it shall be subject to zero percent (0%) VAT pursuant to paragraph (E) Section 14 of the Rules and Regulations implementing R.A. No. 8756. 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