Municipal Ordinance Enacting the Investment Code of 2006 of the Municipality of Cardona

February 1, 2007 Excerpt from the Minutes of the Special Session of the Sangguniang Bayan of Cardona, Rizal, Held on 01 February 2007 Held at the Session Hall on the Third Floor of the Municipal Building. PRESENT: Hon. Ma. Fe SJ. Pastoral Municipal Vice-Mayor/Presiding Officer Hon. Raul C. Himbing Municipal Councilor Hon. Virgilio Arr. Rivera Municipal Councilor Hon. Opher F. Sta. Maria Municipal Councilor Hon. Armando F. Francisco Municipal Councilor Hon. Garry R. Salamat Municipal Councilor Hon. Ruben P. Ocampo Municipal Councilor Hon. Crispo F. Julian Municipal Councilor Hon. Pepito Jose O. Constantino Officio (ABC President)/Acting Presiding Officer Hon. Jesus R. Francisco, Jr. Ex-Officio (PPSK President) ABSENT: Hon. Felix A. Arriola Municipal Councilor CARDONA MUNICIPAL ORDINANCE NO. 33-07 MUNICIPAL ORDINANCE ENACTING THE INVESTMENT CODE OF 2006 OF THE MUNICIPALITY OF CARDONA Author: Hon. Virgilio Arr. Rivera Sponsors: Hon. Opher F. Sta. Maria, Hon. Raul C. Himbing, Hon. Crispo F. Julian & Hon. Jesus R. Francisco, Jr. WHEREAS, pursuant to Chapter 2, Secs. 16, 17 and 18 of the Republic Act 7160, also known as the Local Government Code of 1991, every local government units is empowered to promote the general welfare of its inhabitants, provide basic services, and apply resources for the general well-being of the people; WHEREAS, it is the policy of the Municipality of Cardona, Rizal, to promote and encourage domestic, and if possible foreign investments, in this town; WHEREAS, it is a commitment of the local government officials to pursue economic development through investment promotion and resource mobilization; WHEREAS, to fast track economic development, enactment of an investment code is necessary to encourage investors to establish business in this municipality; HIEAcC WHEREAS, the Sangguniang Bayan of Cardona passed a Resolution No. 058-2000 declaring as an Agro-Industrial Zone an approximately 100 hectares of upland area surrounding the Cardona Diversion Road; WHEREAS, through this initiative, investors can be enticed to put up light and medium industries to increase economic activity in the municipality; WHEREAS, increase in economic activity through new and additional investments will increase employment thereby uplift the economic status and eventually the quality of life of the people of Cardona. NOW, THEREFORE, be it ordained by the Sangguniang Bayan of Cardona, Rizal in session that: CHAPTER I Title Declaration of Policy and Scope SECTION 1. Title . This ordinance shall be known as the Investment Code of 2006 of the Municipality of Cardona . SECTION 2. Declaration of Investment Policy. It is hereby declared as a policy of the municipality to promote domestic and foreign investments in the town of Cardona, Rizal, with the following maxims: HIAESC a. Encourage business that would utilize local artisans, substantial supply of materials and other natural resources of the municipality and that of the province. b. Attract and encourage investments in the area of agri-aqua business, geo-tourism (Rock Garden),transport, manufacturing, services and other activities that will contribute to the socio-economic development of the municipality. c. Encourage business opportunities that will provide livelihood and employment. d. Promote and encourage the participation of accredited Non-Government Organizations (NGO's),People's Organizations (PO's) and the public and private sectors as partners of the municipality. SECTION 3. Scope. This ordinance shall apply to all persons and entities belonging to small and medium enterprises (SME's) and large scale categories in areas of investments in agri-aqua business, geo-tourism, transport, manufacturing, services and other areas of investment in a designated "Business-Economic Park" of the town. HcaDIA CHAPTER II Definition of Terms SECTION 4. Definition of Terms. When used in this ordinance the following terms and phrases shall mean: a. Board shall refer to the Cardona Investment and Promotion Board (CIPB). b. CBC Cardona Business Center, which shall serve as the secretariat and implementing arm of the board. c. Code shall refer to the Investment Code of 2006 of Cardona, Rizal. d. Municipality shall refer to the town of Cardona, Rizal, covering all the areas within its territorial jurisdiction. e. Existing Enterprises establishment/businesses whose place of operations or productions is physically located within the territorial jurisdiction of Cardona, Rizal. f. Incentives shall refer to the fiscal and non-fiscal incentives as provided in this code. EcHIDT g. Local Personnel/Workers refer to a person who is a bona fide resident of Cardona, Rizal employed in all registered businesses. h. New Investors/Enterprises shall refer to investors or enterprises that are not currently engaged in any kind or type of business in Cardona, Rizal, who intend to establish their place of operation or production in the designated "Economic Business Park". i. Areas of Investment refers to economic activities or sections declared as investment areas by the Sangguniang Bayan in accordance with the provisions of this code. j. Registered Business refers to businesses registered with the provisions of this ordinance. k. Business/Economic Park an area designated by the Sangguniang Bayan wherein new business and/or government center are located. CHAPTER III Cardona Investment & Promotion Board SECTION 5. Creation of Cardona Investment & Promotion Board (CIPB) and Its Composition. There is hereby created a Board to be known as "Cardona Investment & Promotion Board" to implement the provision of this Code and whose composition shall be determined by the Sangguniang Bayan with the approval of the Municipal Mayor the composition of which is as follows: EaHIDC Chairperson Municipal Mayor Vice-Chairman (shall be designated by the Municipal Mayor) Members: 1. One (1) representative from the Sangguniang Bayan (Chairman, Trade & Industry Committee) 2. Municipal Planning & Development Coordinator 3. Municipal Treasurer 4. Municipal Budget Officer 5. Municipal Accountant 6. One (1) each from private (Business) sector and public institutions. The membership of the Board maybe increased or decreased by the Sangguniang Bayan upon the recommendation of the Board for the effective implementation of the Code. SECTION 6. Board Meeting and Quorum . Within Sixty (60) days upon approval of this Code, the Municipal Mayor, in his capacity as Chairman, shall convene the Board after appointing the Vice-Chairman and the members as mentioned in Section 5 hereof. The Board shall meet at least once in every quarter or as often as may be deemed necessary, in such day and time that they may have agreed upon. The presence of the majority of its voting members shall constitute a quorum. A quorum is required to exercise its power and perform its junction. IcHSCT SECTION 7. Function of the Board. The primary function of the Board shall be to establish a favorable and stable policy on business that will encourage and support private sector investments and operation of business activities consistent with the development needs and objectives of the municipality. Pursuant to this, the Board shall be vested with the following functions: 1. Formulate rules and regulations to implement the intent and provisions of this Code; 2. Initiate the conduct of technical research as the priority area of investment to be promoted as well as the appropriate incentives and support measures; 3. Formulate and adapt a long range investment promotion program and the corresponding incentives and support measures to be used to attract investors/business entrepreneurs; 4. Supervise the operations and activities of the Cardona Business Center (CBC) for the effective implementation of this Code; 5. Review and update the fiscal and non-fiscal incentives granted to registered business enterprises under this Code; 6. Promote the town as an investment and environmental-friendly place to do business; STIHaE 7. Process and approve applications for registration with the Board imposing such terms and conditions as it may deem necessary to attain the objectives of the ordinance; 8. After due legal notice and hearing, cancel the registration or suspend the enjoyment of incentives or benefits of any registered business for violation of any provisions of this Code and its implementing rules and regulations and/or violation of the terms and conditions of registration and the benefits of incentives. CHAPTER IV Cardona Business Center SECTION 8. Duties and Responsibilities . The Cardona Business Center shall be under the office of the Municipal Mayor and its head appointed by him and shall have the following duties and responsibilities: 1. Serve as one-stop processing and approval center for existing and potential investors and business enterprises. 2. Assist in, (1). Securing licenses and permits (2). Arrange the benefits of local and national incentives and (3). Identify business or joint venture partners, materials suppliers, labor and other requirements of existing and new investors and business enterprises. EHSAaD 3. Establish and maintain data base on general business information, economic activities, available technology and other relevant data information. 4. Networking with counterpart investment promotion organizations and coordinate with support agencies of the government and the private sector. 5. Provide information in business procedures, permit requirements, and government regulations. 6. Assist investors in securing all the requirements of government regulatory agencies. 7. Make referrals to relevant government agencies, support organization, service provider and contacts. 8. Organize appointments, itineraries and site visits including facilitating arrangements for logistical supports. 9. Update regarding major infrastructure projects in the town both existing and planned, as well as other programs and developments that will be of impact in the business environment. 10. Coordinate with the Public Employment Service Office (PESO) for the manpower requirements of the business. IaEScC 11. Undertake an active advocacy campaign to push infrastructure projects aimed at providing necessary facilities as well as policy reforms to enhance the town's investments climate. CHAPTER V Economic Business Park SECTION 9. The Economic Business Park covered by this Ordinance shall be located at the upper Cardona encompassing Barangay Looc, Barangay San Roque, Barangay Iglesia, Barangay Del Remedio and Barangay Calahan. It is traversed by the Bernardo F. San Juan Diversion Road (Cardona Diversion Road).It has an area of approximately 100 hectares more or less. Another cite is the proposed business and government center in the reserved area bounded by Dr. Bayani Etacio Blvd.,Rizal Street, Ramos Street and the Laguna Lake. SECTION 10. Determining Areas of Investment. The Board shall undertake thorough evaluation of all incoming investments and only those economic activities that are environmentally friendly, socio-economically, technically, and financially sound shall be included in the preferred investment areas. The determination of preferred investment areas shall be based on the following: 1. Long-run comparative advantage 2. Economically viable cAHDES 3. Extent and contributions of the activity to a specific development goal 4. Market and technical considerations 5. Effect on social values 6. Other indications of comparative advantage SECTION 11. Preferred Investment Areas . In the initial years of implementation the following shall be adapted as priority investment areas by the Board. 1. Manufacturing (small & medium manufacturing) 1.1 garments 1.2 tin smiting 1.3 ceramic making 1.4 electronics 1.5 light assembly plant 2. Geo-Economic Tourism TcSCEa 2.1 accommodation facilities ( i.e. ,lodging house, Inns) 2.2 transportation Services 2.3 restaurants 2.4 island hopping services and facilities 2.5 nature tripping services and facilities 3. Agri-Aqua Business 3.1 ice cold storage 3.2 aqua-culture and other marine products 3.3 fish production (Milk Fish (Bangus),Tilapia, Big Heads) 3.4 other related aqua-business 4. Services 4.1 Medical/Dental Services/Facilities 4.2 Communication and Information Technology 4.3 Engineering/Architectural Services aHECST 4.4 Accounting/Financial Services 4.5 Recreation and Sports Facilities 4.6 Warehousing and Transport Services 4.7 Housing 4.8 Fast food/catering 4.9 Lending & banking and the like 4.10 Transportation services 4.11 Funeral & memorial services SECTION 12. Determination of Additional Investment Area . Additional economic activities may be included in the list of preferred investment areas upon approval of the Board. The inclusion of additional areas shall be based in the following factors: 1. Generation of high level of employment 2. High degree of value-added features 3. Creation of linkages with local industries EDaHAT 4. No deleterious effect in the environment The Board, however, may remove an area or activity from the list, at any point, when any of the following are present: 1. Sufficient investments in the area or activity have been attained. 2. Continued extension of incentives or support measures for the specific investment area is no longer to the interest of the municipality or may place the local government and the public in adverse position. 3. The investment area or activity cannot attract investors within reasonable time and cost or may result in unfavorable business climate. 4. Lack of progress in the implementation of an environmental management plan. SECTION 12. * Review of Investment Incentives . In order to promote the growth of investments in the town, particularly in the preferred investment areas, the Board shall review the package of incentives and support measures from time to time and recommend for approval to the Sangguniang Bayan the appropriate fiscal and non-fiscal incentives that the municipality shall grant to targeted investors or business enterprises. EHTADa CHAPTER VI Registration of Business Enterprises SECTION 13. Registration of Business Enterprises . New or existing business enterprises shall file its application for registration with the Board through the Cardona Business Center. A registration book shall be used to record all applications filed. The date appearing and stamped on the application forms shall be considered the date of official acceptance. The following documents shall likewise be submitted: 1. Three (3) copies of duly accomplished application form to be provided by the Cardona Business Center (CBC) in accordance with the provisions of this Code. 2. A copy of the Certificate of Registration issued by the Securities & Exchange Commission (SEC),Department of Trade and Industry (DTI),Board of Investment (BOI) and the Cooperative Development Authority (CDA),and other concerned government agencies as the case may be. 3. For existing business enterprises, a copy of the latest and audited Financial Statement of the applicant firm. HAEDCT 4. For corporate type of ownership, a board resolution authorizing the person to file the application for registration. SECTION 14. Qualification of New Business Enterprises . All new business enterprises intending to avail of the incentives as provided for in the Code must be able to meet the following requirements: 1. The business enterprise must have complied with all the requirements mandated under existing local and national laws. 2. The prospective investor's place of operation, branch or production shall be located within the designated zone in the municipality. 3. The prospective investment must engage in any of the areas or activities cited in the preferred areas of investment as may hereafter be declared by the Board. 4. The new enterprise must have a capitalization of at least One Hundred Thousand Pesos (P100,000.00) but not more than Five Hundred Thousand Pesos (P500,000.00) for small scale enterprise, for a medium scale enterprise, Five Hundred Thousand Pesos (P500,000.00) and not more than One Million Pesos (P1,000,000.00), for large scale business projects One Million Pesos (P1,000,000.00) and above, provided that the amount of capitalization shall be based on the total project cost as stated in the investors project/feasibility study submitted to and approved by the Board. EAcHCI 5. The new business enterprise must employ bona fide residents of the municipality in its labor/manpower requirements. 6. Foreign companies intending to apply for registration must comply with Foreign Investment Act of 1991. 7. The project must not be included in the negative list as provided for under the Foreign Investment Act (RA 7042). 8. Project must not negatively affect the environment whether in terms of pollution or resource use. 9. Must be registered with the Securities & Exchange Commission (SEC) in the case of a partnership, corporation or association, Trade and Industry (DTI) in the case of a single proprietorship and Cooperative Development Authority (CDA) in the case of a cooperative. SECTION 15. Qualifications for Existing Enterprises . Any existing business enterprise may avail of the incentives under this Code provided that the following qualifications are met: 1. The business enterprise must comply with all the requirements mandated under existing laws, rules and regulations. TaEIAS 2. The intended expansion or diversification of the existing enterprise must be within the identified investment priority area. 3. The existing enterprise whose place of operation or production is already located within the territorial jurisdiction of the municipality, but which intends to undertake any of the following activities: 3.1 Relocate its principal office at the designated Economic Business Park thereby generating additional employment for the people of Cardona. 3.2 Expand its existing production capacity or construct new facilities and other civil works for the installation of new machinery and equipment or improvement thereof which will result in an increase in production capacity. 4. The expansion or diversification shall have an additional project cost, in the scale provided for in this Code, as stated in the investor's project/feasibility study submitted to and approved by the Board. 5. The expansion or diversification project shall provide employment to bona fide and qualified residents of the municipality. 6. The expansion or diversification shall include an environmental management plan. aIcSED SECTION 16. Registration Procedures and Approval of Application . The Board shall formulate appropriate rules and regulations to facilitate action on application filed, prescribe criteria for the evaluation of application, and devise standard forms for use by applicants. The Board shall approve all applications processed by the Cardona Business Center (CBC). SECTION 17. Certificate of Registration . Under this Code, an enterprise is considered registered upon approval of its application by the Board, and as such, legally entitled to fully avail of any or all of the fiscal incentives provided for in this Code. A registered enterprise shall be issued a Certificate of Registration duly signed by the Chairman of the Cardona Investment and Production Board (CIPB) in such style and form as the Board may determine. CHAPTER VII Privileges SECTION 18. Privileges . The Municipal Government of Cardona, through the Cardona Investment and Promotion Board, guarantees all registered business enterprises their full entitlement of the privileges provided under this Code and other laws, to wit: 1. Access to concise and comprehensive information to registered investors regarding the economic priorities of Cardona, target investment areas, and the general conditions applicable to incoming direct private investments. IcHTCS 2. Dissemination to investors of the investment evaluation criteria and registration procedures to enhance government transparency in the process of granting investment permit in the town. 3. Guarantee the investors peace, stability, growth and profit in their operations whenever policies are to be formulated and modified affecting investment in the town. 4. Facilitation in the implementation of the investment project. 5. Guarantee the investors of non-interference or modification of arrangements after details for the implementation of an investment project have been accepted and approved, and the ownership and management structure of the business enterprise has been established. 6. Establishment of an environment of healthy competition between and among business enterprises operating within the territorial jurisdiction of the municipality, whether domestic or foreign. CHAPTER VIII Fiscal & Non-Fiscal Incentives SECTION 19. Tax Incentives to Registered Business Enterprises . In addition to the incentives provided under RA 7160 otherwise known as the Local Government Code of 1991 and other pertinent laws, a registered business enterprise under this Code shall enjoy tax incentive to the extent as may be provided for under applicable laws, rules and regulations. cTaDHS SECTION 20. Non-Fiscal Incentives . Registered business enterprises and investors shall be granted the following non-fiscal incentives: 1. Provision of a one-stop documentation center for simplified documentation procedures relative to issuance of business permit. 2. Consistent support for peaceful business operations. 3. Assistance in securing direct source of electric power, water supply and other utilities. 4. Assistance in site selection. 5. Assistance in labor recruitment and mediation. 6. Other non-fiscal incentives as may be determined by the Board. CHAPTER IX Final Provisions SECTION 21. Appropriations. Covering the current operating expenditures and capital outlays for the Cardona Investment and Promotion Board and the Cardona Business Center shall be included in the annual budget. HDAECI SECTION 22. Penal Provisions . Any violation of the provisions of this Code, existing laws, ordinances, rules and regulations by any registered business enterprise, shall be ground for the cancellation or revocation of registration of the business and the withdrawal of all incentives granted under this Code. SECTION 22. Separability Clause . If, for any reason, any part or provision of this Code/Ordinance shall be declared invalid, suspended or revoked by a court of competent jurisdiction, other parts or provisions hereof which are not affected shall continue to be in full force and in effect. SECTION 24. Repealing Clause . All ordinances, executive orders, rules and regulations in consistent or in conflict with the provisions of this Code are hereby repealed, amended or modified accordingly. SECTION 25. Effectivity . This Ordinance shall take effect upon approval. ENACTED on this 1st day of February 2007 in Cardona, Rizal, upon motion of Honorable Crispo F. Julian duly seconded by Honorable Opher F. Sta. Maria. CERTIFIED TRUE AND CORRECT: IMELDA S. RAMOS SB Secretary ATTESTED: PEPITO JOSE O. CONSTANTINO Municipal Councilor Acting Presiding Officer APPROVED: GIL SJ. SAN JUAN Municipal Mayor