Local Investment Incentives Ordinance of the Municipality of Lal-lo

October 10, 2005 Excerpts from the Minutes of the 60th Regular Session of the 5th Sangguniang Bayan of Lal-lo, Cagayan Held at the SB Session Hall on Monday, October 10, 2005 PRESENT: Hon. Federico C. Arteta SB Member-Temporary Presiding Officer Hon. Florante P. Paat SB Member Hon. Roger T. Vinarao SB Member Hon. Ernesto P. Bolando SB Member Hon. Simeon O. Israel, Jr. SB Member Hon. Prudencio B. Consigna SB Member Hon. Andrea R. Siruno SB Member Hon. Aladino G. Dupaya, Jr. ABC President ABSENT Hon. Dominador B. Invierno Vice Mayor busy performing his function as Acting Mayor Hon. Joseph C. Bacuyag SB Member Hon. Mikhail Maverick P. Tumacder SK Federation President LAL-LO ORDINANCE NO. 010-05 AN ORDINANCE PROVIDING FOR A LOCAL INVESTMENT INCENTIVES TO INDUSTRIES WHICH MAY HEREAFTER BE ESTABLISHED IN THE MUNICIPALITY OF LAL-LO, CAGAYAN AND FOR OTHER PURPOSES SECTION 1. This Ordinance shall be known as the "LOCAL INVESTMENT INCENTIVES ORDINANCE OF THE MUNICIPALITY OF LAL-LO". HTcADC SECTION 2. Any person or entity which meets the qualifications and requirements set forth under Section 3 of this Ordinance and which will commence its business operations in this Municipality of Lal-lo after the approval of this ordinance, may apply to avail of the incentives and privileges provided herein. SECTION 3. Subject to the provision of Section 14 hereof, this Ordinance shall apply to any person, partnership or corporation, association and cooperatives, provided that they meet the following qualifications: a) Must be qualified to do business under existing national laws; b) Must be fully registered with appropriate government agencies, such as the Department of Trade and Industry, the Securities and Exchange Commission, the Cooperative Development Authority and other appropriate government agencies; c) Must have an initial capital investment of not less than ONE MILLION PESOS (P1,000,000.00) in case of Filipino investors and not less than TWO HUNDRED THOUSAND DOLLARS ($200,000.00) or its equivalent in Philippine pesos for foreign investors; d) Must remit and actually deposit the required amount of investments whether initial or additional to any bank of their choice nearest in the Municipality of Lal-lo and be covered by a Certificate of Deposit duly signed by the Bank Manager. SECTION 4. All applicants under this Ordinance must comply with the requirements of all existing applicable laws. SECTION 5. Any person, partnership, corporation, association and cooperative whose application has been accepted and granted Certificate of Registration/Exemption under the pertinent provisions of this ordinance must employ at least eighty percent (80%), Filipino working force and residents of the Municipality of Lal-lo. SECTION 6. For the purpose of giving effect to this Ordinance, a Local Investment Board (LIB) is hereby created with the following composition, powers and functions: a) The Local Investment Board (LIB) shall be composed of the following: Chairman - The Municipal Mayor 1st Vice-Chairman - The Vice Mayor 2nd Vice-Chairman - The President of the Local Association of Businessman Members - Chairman, Committee on Laws Sangguniang Bayan - Chairman, Committee on Appropriations, Ways and Means Sangguniang Bayan - Representative from the Department of Trade and Industry, Tuguegarao City Regional Office who is permanently designated by the said agency. - Representative from any financing institution or bank servicing the municipality of Lal-lo. - Two (2) other members of the Sangguniang Bayan of the Municipality of Lal-lo duly elected by majority of the Sangguniang Bayan Members. - The Municipal Treasurer - Representative of a duly accredited Non- Government Organization (NGO) to be elected from among the Environmental NGO Groups in Lal-lo, Cagayan - The Municipal Budget Officer - The Municipal Planning and Development Coordinator b) Powers and Functions of the Local Investment Board (LIB) 1) To screen, evaluate, accept, approve or reject applicants who want to avail of this investment incentives and privileges and to issue Certificate of Exemptions; aScITE 2) The Chairman, or any of the thirteen (13) members of the Board can call for a meeting to formulate rules and guidelines to ensure compliance with provisions of this Ordinance. The Board shall meet as often as necessary but shall not be less than once a month; 3) All applications submitted to the Local Investment Board shall be acted upon within thirty (30) days upon receipt hereof; 4) In order to give more effect to the Local Investment Program under this Ordinance, the Local Investment Board is hereby empowered to conduct Trade Missions both local and foreign, for the purpose of inviting investors as well as providing necessary information and dissemination drive to parties willing to avail of the Investment Incentives Program under this ordinance; Provided however, that in the case of foreign trade missions, the approval of the Sangguniang Bayan must be secured; 5) Trade missions involving local and foreign international trade organizations as well as trade missions involving Board of Investors Offices, foreign embassies and consulates in the Philippines and abroad shall be headed by the Municipal Mayor or in his absence, by any of his duly authorized member of the Local Investment Board (LIB). Provided, that in the case of International Trade Organizations, there is a need for an endorsement or referral by the Bureau of International Trade Promotions, DTI; 6) The Local Investment Board is hereby empowered to identify, acquire and develop Industrial Estates and Business Parks and other investment areas in Lal-lo, Cagayan in accordance with the approved investment priorities of the Municipality. SECTION 7. An amount shall be provided in the annual or supplemental budget of the Municipality for the purpose of office supplies and equipments, operational expenses and for trade missions of the Local Investment Board; SECTION 8. The Office of the Municipal Planning and Development Coordinator shall serve as the Secretariat of the Local Investment Board and assist the Board in its functions as well as process and provide all applicants with the application forms and other necessary papers to be filled up wherein all information and data of the applicants are stated: the nature of business applied; amount of capital investment and the name of the bank where the investment money are deposited; location of business or factory site; date when the business is to be established or started and the possible number of workers or employees to be utilized or hired. The Office of the Municipal Planning Development Coordinator shall upon authority of the Board initiate investment promotion programs for the municipality. SECTION 9. This Local Investment Program shall apply only to new businesses which establish and start its operation after the approval of this Ordinance and shall enjoy the privileges granted by this program for a period as may be determined on the basis of the amount of investments put up by the investors under the following brackets: Amount of Investments Period of Examination P1,000,000.00 to P2,000,000.00 Five (5) years Over P2,000,000.00 to P5,000,000.00 Seven (7) years Over P5,000,000.00 to P20,000,000.00 Eight (8) years Over P20,000,000.00 to P50,000,000.00 Nine (9) years Over P50,000,000.00 and above Twelve (12) years SECTION 10. Only participating members who have invested an amount of more than 20 million pesos, Philippine currency can be granted an extension period of another ten (10) years upon the recommendation of the Local Investment Board and subject to the approval of the Sangguniang Bayan. HEITAD SECTION 11. Tax Holiday Incentives. All qualified and accepted applicants to this Investment Incentive Program shall enjoy the following Tax Exemption privileges for a period stated in Section 9, hereof, viz. : a. Exemption from the payment of all kind of taxes imposed by the municipality under existing tax or revenue ordinances. b. Exemption from the payment of all licenses and permit fees; However, all participants to this Incentive Program are still required to secure Mayor's Permit necessary to operate their business, provided, the issuance thereof, is ministerial; c. Exemption from inspection and examinations of Books of Accounts and other pertinent records of business, except when required by the Board. SECTION 12. Other Privileges. a) Free use of government land owned by the Municipal Government for a period of twenty (20) years, if the participating business concerned shall construct an infrastructure at the less developed area of the municipality, subject to the approval of the Sangguniang Bayan, provided however that the ownership of the said infrastructure constructed will be transferred to the Municipal Government upon the expiration of twenty (20) year period, as abovesaid; provided, further that in case the participating member decides to continue its business operation after the expiration of the twenty (20) year period, he may continue to occupy the infrastructure facilities without any rental, except to pay for the rental of the lot where the infrastructure was constructed at a reasonable rate to be approved by the Sangguniang Bayan upon the recommendation of the Local Finance Committee; provided, finally that the proposed site is not allotted for a specific government project; b) Exemption from local contractor's tax should the participating business concerned decides to transact business with the municipal government, it being a qualified contractor. SECTION 13. Existing businesses of whatever kind or nature that are retired for the purpose of availing of this Investment Incentive Program shall not be allowed to apply under the ordinance. SECTION 14. Coverage. Business enterprises applicants having the following type or nature of business shall be given priority under this Incentive Program. a) Labor Generating Enterprises; b) Enterprises to be established in less developed areas of the municipality as may be determined by the Zoning and Land Use Ordinance; c) Manufacturing enterprises using raw materials available locally; d) Manufacturing or Processing Plants; e) General Merchandising or Consumer Oriented Enterprises; f) Tourism Oriented Enterprises; g) Service Oriented Enterprises; h) Pioneering Enterprises; i) Water and Power Resources Development Enterprises; j) Agri-Business Oriented Enterprise. ATICcS SECTION 15. Registration. Upon the approval/acceptance of any applicant to this Local Investment Program, the applicant shall be required to pay an annual Registration Fee to the Municipal Treasurer in accordance with the rate prescribed below, after which the Board shall issue a Certificate of Registration along with the Certificate of Exemptions to the business concerned as member/participant duly stating the incentives and privileges granted under the provisions of this Ordinance: Amount of Investment Annual Registration Fee P1,000,000.00 to P2,000,000.00 P10,000.00 Over P2,000,000.00 to P5,000,000.00 P28,000.00 Over P5,000,000.00 to P20,000,000.00 P50,000.00 Over P20,000,000.00 to P50,000,000.00 P75,000.00 Over P50,000,000.00 and above P100,000.00 SECTION 16. All participating members who are granted the incentives/privileges for more than one (1) year shall remit their annual Registration Fee in full to the municipality on or before January 31 of each calendar year. SECTION 17. Exception. This Investment Incentives Program shall not apply to financing or banking institutions which are governed by the Central Banking Act and under the supervision of the Central Bank of the Philippines. SECTION 18. The incentives and privileges granted to the registered members of this Local Investment Incentives Ordinance are non-transferable, except in the event of death, permanent incapacity of a participating member, where the incentives and privileges shall be transferred to the heirs or descendants in accordance with law on succession. SECTION 19. Annual Inspection. The Local Investment Board (LIB) shall conduct an annual inspection on the participating firms on their progress either by itself or by requesting local government agency to conduct the same, inspection shall be limited to the total gross sales receipts; compliance of the Minimum Wage Law; or to the provisions of this Ordinance and the privileges granted as stated in the Certificate of Registration/Exemption. SECTION 20. Reporting. At the end of each calendar year but not later than April 30, all registered members to this program shall submit copies of duly audited financial statements to the Local Investment Board, the Sangguniang Bayan, the Municipal Treasurer and the Office of the Mayor for evaluation and record purposes. SECTION 21. Violations. Any participating member who is found to have violated any provision of this Ordinance shall forfeit the incentives and privileges granted, and shall be required to pay all taxes and fees due from the start of its business operation, upon the recommendation of the Local Investment Board. SECTION 22. Penalty. Any person who violates any provision of this Ordinance shall be penalized with a fine of not less than One Thousand Pesos (P1,000.00) but not more than Five Thousand Pesos (P5,000.00) or an imprisonment of not less than one (1) month but not more than six (6) months, or both such fine and imprisonment at the discretion of the court. In case the violation is committed by partnership, corporation, association, or cooperative, the Manager or President or Chief Executive Officer, as the case may be, shall suffer the penalty provided herein. SECTION 23. Effectivity. This Ordinance shall take effect after compliance of the required publications and posting. Thereafter, the Local Investment Board (LIB) shall send copies of this Ordinance to foreign embassies and consulates in the Philippines, to all major business groups and civic clubs in the Municipality and to the Headquarters of the Philippines Chamber of Commerce and Industry Incorporated Filipino-Chinese Chamber of Commerce and Industry, Inc., American Chamber of Commerce in the Philippines, and major International Trade Organizations referred to by the DTI to the Board of Investments. TIADCc SECTION 24. Existing ordinances inconsistent with the provisions of this ordinance are hereby repealed accordingly. ADOPTED on motion of Councilor Simeon O. Israel, Jr. seconded by Councilor Florante P. Paat. I HEREBY CERTIFY to the correctness of the above-mentioned ordinance. (SGD.) OSCAR A. DE LA FUENTE Secretary to the Sangguniang Bayan ATTESTED: (SGD.) FEDERICO C. ARTETA Temporary Presiding Officer APPROVED: (SGD.) DOMINADOR B. INVIERNO Acting Mayor