PHIVIDEC Industrial Authority

August 14, 2003 FIRB RESOLUTION NO. 002-03 SUBJECT : PHIVIDEC Industrial Authority WHEREAS, the PHIVIDEC Industrial Authority (PIA) is mandated pursuant to its Charter (Presidential Decree No. 538, as amended) to encourage, promote and sustain the economic and social growth of the country through the establishment of well-planned industrial areas such as the PHIVIDEC Industrial Estate in Misamis Oriental (PIEMO); WHEREAS, the PIA is constructing an international seaport known as the Mindanao Container Terminal Project (MCTP) to cater to containerized cargoes; WHEREAS, the MCTP is one of the flagship projects of the government and plays an important role in promoting the industrial estate program of the PIA by providing efficient port services and accommodating the increase in cargo traffic, considering that the PHIVIDEC estate was declared in 1994 as the Regional Agri-Industrial Center of Northern Mindanao; WHEREAS, the MCTP requires importations of construction materials and equipment needed to complete the project and enhance the attractiveness of PIA's industrial estate as an investment location; WHEREAS, if the taxes and duties are borne by the PIA, it may have some financial difficulty in complying with such obligations, given the level of its income and the fact that a part of its net income would still be devoted to its commitment to uplift the socio-economic condition of war veterans, military retirees and their dependents and it does not have any budgetary support to carry out the project. WHEREAS, there is also a need to ensure that all importations covered by this tax subsidy grant will be used exclusively for the MCTP and not for other purposes; NOW THEREFORE BE IT RESOLVED, AS IT IS HEREBY RESOLVED, to grant tax subsidy to the PIA in the amount of P153 million only , representing the taxes and duties on its importations of construction materials and equipment only excluding motor vehicles and for the exclusive use of the MCTP for the year 2003 per Annex A, hereof broken down as follows: (a) importations that already arrived with billings of the Bureau of Customs (BOC) (P11,236,512); (b) importations in the billing process (P5,285,180); and (c) projected importations for the rest of the year (P136,478,308): Provided, however , that the initial issuance of the corresponding Certificate of Entitlement to Subsidy (CES) shall be limited to the amount of P16,521,692 only , representing the taxes and duties on importations that already arrived with BOC billings and in the billing process and that subsequent CES shall be issued upon the submission by the PIA to the FIRB of the required billing and/or documents evidencing the importations: Provided further , that all materials and equipment for which tax subsidy is granted shall form part of the regular inventory of the PIA (in the case of materials and movable equipment) and/or be located in their designated project stations/operating areas (in the case of immovable equipment) as certified to by the resident Commission on Audit (COA) auditor of the PIA and its Project Station/Operating Area Manager, respectively; Provided, finally , that the grant of such subsidy shall be in accordance with the terms and conditions of Section 13 of the 2003 General Appropriations Act, subject to the availability of funds therefor, pursuant to the terms and conditions of the Rules and Regulations to Implement the Subsidy Provision Under Executive Order No. 93. caHASI (SGD.) NIEVES L. OSORIO Undersecretary of Finance Presiding Officer - FIRB Reference: FIRB Technical Committee Meeting dated July 22, 2003 FIRB Meeting dated August 14, 2003 Materials and Equipment to be Imported for Year 2003