Norden Maritime Services, Inc.

August 6, 2009 BIR RULING [DA-(VAT-093) 443-09] R.A. 7916 & RR 4-07; DA-(IL-006) 047-08 Norden Maritime Services, Inc. Subic Shipyard Special Economic Zone Barrio Cawag, Subic Zambales Attention: Mr. Jose Jay Pernes Managing Director Gentlemen : This refers to your letter dated May 12, 2009 requesting for issuance of a VAT zero-rate certificate. Documents submitted disclosed that Norden Maritime Services, Inc. ("NMSI" for brevity) is an Ecozone Export Enterprise with Philippine Economic Zone Authority (PEZA) Certificate of Registration No. 05-24 dated May 17, 2005. It is registered with the Securities and Exchange Commission under SEC Registration No. A200005953 issued on February 4, 2008. The sole purpose of NMSI is "(t)o engage in, undertake and conduct the business of a general contractor for any and all types of maritime and other related services". In reply, please be informed that Section 5 of Revenue Regulations (RR) No. 4-2007 provides viz. : CTEDSI "Section 5. Zero Rated Sales. Sec. 4.106-5 of RR No. 16-2005 is hereby amended to read as follows: "SEC. 4.106-5. Zero-Rated Sales of Goods or Properties. The following sales by VAT-registered persons shall be subject to zero percent (0%) rate: (a) Export Sales. . . . (5) Transactions considered export sales under Executive Order No. 226, otherwise known as the Omnibus Investments Code of 1987, and other special laws. 'Considered export sales under Executive Order No. 226' shall mean the Philippine port F.O.B. value determined from invoices, bills of lading, inward letters of credit, landing certificates, and other commercial documents, of export products exported directly by a registered export producer, or the net selling price of export products sold by a registered export producer to another export producer, or to an export trader that subsequently exports the same . . .; Provided, further, that pursuant to E.O. 226 and other special laws, even without actual exportation, the following shall be considered constructively exported: . . .; (2) sales to export processing zones pursuant to Republic Act (R.A.) Nos. 7916, as amended, 7903, 7922 and other similar export processing zones; . . ." prcd Thus, sale of goods by a VAT-registered person to NMSI, a PEZA-registered Export Enterprise shall be subject to VAT at zero (0%) rate pursuant to the aforementioned Sec. 4.106-5 of RR No. 16-2005, as amended by RR No. 4-2007. 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