An Ordinance Enacting the 2017 Investment Incentive Code of the Municipality of Makilala, Cotabato

December 8, 2017 Excerpt from the Minutes of the Special Session of the Sangguniang Bayan of Makilala, North Cotabato Held at Ricardo L. Ipong Memorial Hall, This Municipality on the 8th Day of December, 2017. RESOLUTION NO. 383-2017 RESOLUTION ENACTING AN ORDINANCE APPROVING THE 2017 INVESTMENT AND INCENTIVE CODE OF THE MUNICIPALITY OF MAKILALA, COTABATO Presented to the body for deliberation was the 2017 Investment and Incentive Code of Makilala, Cotabato. WHEREFORE , after thorough discussion and deliberation, on motion of Hon. Ryan D. Tabanay, duly seconded by Hon. Rene G. Molina, the sanggunian; RESOLVED , as it is resolved, to enact, an Ordinance approving the 2017 Investment and Incentive Code of Makilala, Cotabato, to wit: MAKILALA MUNICIPAL ORDINANCE NO. 351-17 AN ORDINANCE ENACTING THE 2017 INVESTMENT INCENTIVE CODE OF THE MUNICIPALITY OF MAKILALA, COTABATO Be it enacted by the Sangguniang Bayan of Makilala, Cotabato in its Special Session, that: ARTICLE I Title and Declaration of Policy SECTION 1. Title . This Ordinance shall be known as the 2017 Investment Incentive Code of the Municipality of Makilala. SECTION 2. Declaration of Policies . It is declared the policy of the Municipal Government of Makilala to encourage both local and foreign investments in its jurisdiction that will result in the mutual benefits of its citizens and investors, taking into account the principles of sustainable development, wise utilization of natural resources, equitable distribution of wealth and holistic human resource development. It is further the policy of the Municipal Government to: 1. Accelerate the sound development of the municipal economy, in consonance with the principles and objectives of economic nationalism, and in pursuance of a planned economically feasible and practicable establishment of industries. 2. To encourage Filipino and Foreign investments as hereinafter set out, in projects to develop agricultural, processing and manufacturing industries which increase municipal income, bring about economic upliftment, provide more opportunities for employment, and raise the standard of living of the people of Makilala. 3. Welcome and encourage foreign capital to establish pioneer enterprises that are capital and labor intensive and would utilize a substantial amount of domestic raw materials, in joint venture with substantial Filipino capital whenever available. Moreover, the municipal government acknowledges its lead role in promoting industrial peace and security in establishing infrastructure facilities and as agent in the transformation of the community into a responsive citizenry. Finally, the municipality manifests its desire to attract investors through efficient and effective governance, insuring management continuity of policies, providing fiscal incentives, supportive and facilitative political climate, and providing adequate support promoting political stability. SECTION 3. Definition of Terms as Used in This Ordinance . 1. "Board" shall refer to the Municipal Investment Board created under the Code. 2. "Code" shall refer to the 2016 Investment Incentive Code of the Municipality of Makilala. 3. "Municipality" shall refer to the Municipality of Makilala covering all areas within its territorial jurisdiction as provided by law. 4. "Investment" shall refer to money, equipment, or properties, professional services or rights expressed in monetary value put-in for the purpose of engaging in a business activity. 5. "Small Scale Enterprise" shall refer to the enterprise having a total asset of P3.01 to 15 million pesos, excluding the value of land. 6. "Medium Scale Enterprise" shall refer to the business enterprise having a total asset of P15.01 to 100 million pesos, excluding the value of land. 7. "Large Scale Enterprise" shall refer to the business enterprise having a total asset of more than P100 million pesos, excluding the value of land. 8. "Registered Establishment/Enterprise" shall refer to any establishment and/or enterprise qualified and issued a Certificate of Registration/Exemption to avail of incentives under this Code. 9. "Existing Establishment/Enterprises" shall refer to those establishments and/or enterprises which are in operation and whose production areas are located within the territorial jurisdiction of the Municipality of Makilala prior to the approval of this Ordinance and have not previously availed of the herein incentives. 10. "Expansion of Establishments/Enterprises" shall refer to existing establishments and/or enterprises which shall increase their capitalization, production capacity/volume of operation, employment and/or putting up of a new physical structures and facilities. 11. "New Establishment/Enterprises" shall refer to those prospective establishments and/or enterprises which are not yet in operation prior to the approval of this Ordinance or those prospective establishments and/or enterprises who wish to establish a capital and labor-intensive business venture within the territorial jurisdiction of the Municipality of Makilala after the approval of this Ordinance. 12. "Incentives" shall refer to the benefits or privileges granted by the Municipality of Makilala to encourage investment. 13. "Fiscal Incentive" shall refer to the direct financial or monetary benefit to the investor. 14. "Non-Fiscal Incentives" shall refer to a non-monetary value of incentives that provide direct benefit to investors. 15. "Certificate of Registration/Exemption" shall refer to the certificate given to participating members who have availed of the investment incentive program of the municipality and who will enjoy tax holidays/exemptions as provided for in this Ordinance. 16. "Tax Holiday" shall refer to the tax exemptions granted to registered enterprise. 17. "Government Agencies" shall refer to the branch of national government in charge of promoting, regulating and supervising investments such as, Department of Trade and Industry (DTI), Securities and Exchange Commission (SEC), Social Security System (SSS), Bureau of Internal Revenue (BIR), National Economic and Development Authority (NEDA), and the Department of Environment and natural Resources (DENR). ARTICLE II Purpose, Objective and Goal SECTION 1. It is the purpose, objective and goal of this Ordinance to: a. Integrate and supplement the investment incentive law of the national government appropriate to local initiative to attract both local and foreign investors. b. Enhance the image of the Municipality of Makilala as a competitive location of business in the Province of Cotabato. c. Promote an investment and business-friendly environment that facilitates expeditious processing of papers and documents on matters related to investments. d. Promulgate investment policy guidelines for investors to have ready accessible information on local investment priority areas and corresponding tax exemptions, privileges and incentives. e. Encourage the establishment of investment projects that are able to utilize indigenous natural resources and raw materials, as well as those that are labor-intensive and environment-friendly industries. ARTICLE III Municipal Investment Board SECTION 1. Municipal Investment Board . Within fifteen (15) days from enactment of this Ordinance, the Municipal Investment Board shall be created to implement the provisions of this Ordinance to be composed of the following: Chairman Municipal Mayor Vice Chairman Mun. Vice Mayor Members: 1. SB Member Chairman of Committee on Market, Trade and Industry 2. SB Member Chairman of Committee on Laws and Rules 3. SB Member Chairman of Committee on Finance 4. Representative from the Business Organization 5. Representative from the Bankers Association 6. Representative from the Academe Sector 7. Representative from the Agricultural/Farmers Association 8. Representative from the NGO's (Non-Government Organization) 9. Representative from the Labor Organization Provided, that said representatives from the private sectors come from Organizations duly accredited by the Sangguniang Bayan. Provided further, that the term of office of the representative from the private sectors shall be determined by the Municipal Investment Board and to be implemented thru an Executive Order of the Municipal Mayor. SECTION 2. Powers and Duties of the Municipal Investment Board . The Municipal Investment Board (MIB) shall be responsible for the regulation and promotion of investment in the Municipality of Makilala. The Board shall have the following powers and duties: 1. To formulate and prescribe the Implementing Rules and Regulations of this Ordinance. 2. To give more effects to the Investment Program under this Ordinance, the Board is hereby empowered to conduct Trade Missions 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. 3. To adopt an investment program and prescribe corresponding incentives and support measures for the promotion of the Municipality as an investment destination. 4. To identify, develop, acquire, and prepare a site development plan congruent to the municipality's approved short, medium, and long term comprehensive development plan. 5. To act within thirty (30) days from receipt thereof all applications submitted to the Municipal Investment Board. 6. To accept, process, appraise, evaluate, approve and/or reject applications for incentives under this Ordinance. 7. To recommend to the Mayor/Chairman of the Board additional budget and/or identify alternative funding for effective implementation of this Ordinance. 8. To review the package of appropriate incentives and support measures every three (3) years as the need arises. SECTION 4. n Meeting and Quorum of the Board . The Board shall meet at least once every quarter or as deemed necessary. The presence of the majority of all the members shall constitute a quorum. The meeting venue is the Municipal Session Hall or any venue designated by the Board. SECTION 5. Secretariat and Technical Working Group (TWG) . There shall be Technical Working Group as ancillary to the Board shall be composed of the following: 1. Representative from the DTI 2. Municipal Planning and Development Coordinator 3. Municipal Assessor 4. Municipal Treasurer 5. Municipal and Environment and Natural Resources Officer 6. Municipal Engineer 7. Municipal Tourism Officer 8. Secretary to the Sanggunian 9. Two (2) Representatives from the Private Sector duly appointed by the Mayor SECTION 6. Functions and Responsibilities of the Technical Working Group . The Technical Working Group who shall provide technical support at the same time act as Secretariat to the Board shall have the following functions and responsibilities: 1. Review and correlate information, data and studies to come up with local policies and incentives on investments 2. Recommend and submit to the Board, local policies and incentives on investment for its consideration and approval, and for legislation by the Sangguniang Bayan. 3. Promulgate implementing guidelines and procedures on the availment by the investors of the local incentives adopted and legislated by the Sangguniang Bayan. 4. Adopt, process and evaluate all application for legislation for availment of the local incentives and submit its recommendation for action by the board. 5. Extend appropriate and thorough assistance to investor on the application for local incentive thru the establishment of One-Stop Makilala Investment Promotion Center and maintaining network with other agencies and office; and 6. Submit reports to the Board through its chairman on the development and implementation of local policies and incentives as adopted and legislated by the Sangguniang Bayan. ARTICLE IV Investment Priority Plan SECTION 1. Local Investment Priority Plan . Within sixty (60) days from the enactment of this Ordinance, the Board shall formulate its Local Investment Priority Plan which shall generate employment and enhance and accelerate economic development of the Municipality, such as: a. Manufacturing and Processing Enterprises b. Manufacturing Enterprises using raw materials readily available locally c. Export-Oriented Industries d. Tourism-Oriented Industries e. Pioneering Enterprises f. Information and Communication Technology Enterprises g. Utility Companies engaged in Power Generation and Distribution, Water, Telecommunication and those similar in nature h. Social Services, which include Health Care Services, Educational Institutions and Low-Cost Housing SECTION 2. The Board may revise the identified Local Investment Priority Plan every three (3) years as it may deem necessary. ARTICLE V Qualifications SECTION 1. All new investors or business enterprises who intend to register and avail of the incentives provided in this Ordinance must meet the following qualifications: a. The business enterprise must have complied with all the requirements mandated under existing national and local laws. b. The place of operation or production will be located within the territorial jurisdiction of the Municipality. c. The business enterprise must have a capitalization of at least Two Million Pesos (Php2,000,000.00) which shall be based on the total project cost stated in the investor's study submitted to and approved by the Board. d. The project or business enterprises shall provide employment to bona fide residents of the Barangay/Municipality of not less than: 10 persons for investment worth P2 million but less than P10 million 20 persons for investment worth 10 million but less than 15 million 50 persons for investment worth 15 million and above Provided, that enterprises/industries using information, communication technology facilities, automated devices and equipment and the like requiring highly technical expertise or training may be exempted from this requirement subject to the review of Technical Working Group (TWG) duly created for the purpose by the Board. Findings and recommendations shall be subject to the approval of the Board. SECTION 2. All existing investors/business enterprise which intends to register and avail of the incentives under this Ordinance must meet the following qualifications: a. The place of operation or production is already located within the territorial jurisdiction of the Municipality and will expand its existing operation with an additional investment of at least Two Million Pesos (P2,000,000.00). b. Shall provide employment to bona fide residents of the Barangay/Municipality of not less than: 10 persons for additional investment worth P2 million but less than P10 million 20 persons for additional investment worth 10 million but less than 15 million 50 persons for additional investment worth 15 million and above c. The prospective investor/enterprise must have complied with all the requirements mandated under the local and national laws. d. The prospective investor/enterprise must engage in activities mentioned in the Local Investment Priority Plan. Provided, that enterprises/industries using information, communication technology facilities, automated devices and equipment and the like requiring highly technical expertise or training may be exempted from this requirement, subject to the review of Technical Working Group (TWG) duly created for the purpose by the Board. Findings and recommendations shall be subject to the approval of the Board. SECTION 3. Limitation on Availment of Incentives . Investors/Enterprises referred to under Section 1 and 2 of this Article can avail of the incentives granted herein only once. SECTION 4. Registration Requirements . Investors/Enterprises qualified under Section 1 and 2 of this Article shall file their application. The application shall be considered accepted after upon submission and/or payment of the following: a. Three (3) sets of the following documents: 1. Duly filled-up and notarized application form to be provided by the Board in accordance with the provision of this Ordinance; 2. Certified true copy of applicant's Certificate of Registration with the Securities and Exchange Commission, Department of Trade and Industry, Cooperative Development Authority or other concerned government licensing agencies as may be applicable; 3. Project study of the proposed investment showing that the project is economically, technically and financially feasible and viable; 4. Secretary's Certificate thru a Corporate Board Resolution (Corporation) authorizing a representative to sign documents and transact business with the Municipal Investment Board; 5. For existing enterprises, an audited financial statements and income tax returns for the past three (3) years; and 6. Other documents as may be required by the Board. b. Payment of non-refundable filing fee of Five Hundred Pesos (Php500.00) for each application. Provided, that all documentary requirements specified under Section 4a of this Article have been duly complied with. SECTION 5. Disqualification . Existing business enterprise that has been retired for the purpose of availing this investment incentive program should not be allowed to apply under this Ordinance. SECTION 6. Payment of Registration Fees . All participating members who are granted the incentives/privileges are 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 provision of this Ordinance: Amount of Investments Annual Registration Fee P2,000,000.00-P3,000,000.00 P5,000.00 3,000,001.00-5,000,000.00 10,000.00 5,000,001.00-10,000,000.00 15,000.00 10,000,001.00-15,000,000.00 20,000.00 15,000,001.00-and above 25,000.00 SECTION 7. Annual Inspection . The Municipal Investment Board shall conduct an annual inspection of the participating members on their progress either by itself or by requesting a local government agency to conduct the same and said inspection shall be limited to the total sales/receipts; compliance of the Minimum Wage Law; or to the provisions of this Ordinance and the privilege granted as stated in the Certificate of Registration/Exemption. SECTION 8. Reporting . At the end of each calendar year but not later than April 30, all participating members in this program shall submit copies of duly audited financial statements to the Municipal Investment Board, Sangguniang Bayan, the Municipal Treasurer, and the Office of the Municipal Mayor for evaluation and record purposes. SECTION 9. Violation . Any participating member who is found to have violated any provision of this ordinance shall forfeit the incentives and/or privileges granted herein and shall be required to pay all taxes due from the start of its business operation, upon the recommendation of the Board. ARTICLE VI Incentives to Registered Enterprises SECTION 1. Fiscal Incentives . The Investment Incentive Program shall apply to new businesses which establish and start their operations after the approval of this ordinance and those existing enterprises planning to expand their investments, 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 Discount period P2,000,000.00-P3,000,000.00 1 year 3,000,001.00-5,000,000.00 2 years 5,000,001.00-10,000,000.00 3 years 10,000,001.00-15,000,000.00 4 years 15,000,001.00-and above 5 years SECTION 2. Tax Holiday Incentives . All qualified and accepted applicants to the Investment Incentive Program shall enjoy the following Tax Exemption privilege for a period stated in Section 1, of this Article hereof, viz. : a. Exemption from payment of 40% Municipal Share of the Real Property Tax. This exemption is limited only to those real properties directly used in the business only. b. Exemption from payment of all municipal licensing and permit fees. However, all participants in the Investment Incentive Program are still required to secure the Mayor's Permit and such other permits necessary to operate their business. c. Exemption from listing on the assessment rolls or reclassified real property on the duration of the construction of factory/building on the business site until such time that business operation shall have started. Exemption period shall not exceed two (2) years. SECTION 3. Non-Fiscal Incentives . Non-fiscal incentives include unqualified support and assistance from the Local Government Unit, members of the Board on matters on lot acquisition or lease, processing of documents, acquisition of right of way, including mediation in the event of labor unrest and strikes. Provided however, that labor rights are not jeopardized. SECTION 4. Non-Applicability . The incentives granted under this Ordinance shall not apply to banking, financing and lending institutions, which are governed by the General Banking Act and under the supervision of the Bangko Sentral ng Pilipinas. SECTION 5. The incentives and privileges granted to the registered members of this Local Investment Incentives Ordinance are non-transferable, except in the event of death or permanent incapacity of a participating member, where the incentives and privileges shall be transferred to the heirs of decedent in accordance with law on succession if the applicant is a natural person. Mergers, consolidation, buy-outs and the like of corporation shall be decided on a case-to-case basis by the Board, provided that when such movements are done to strengthen the corporation and increase the investments, then such movement may be treated as an expanding business. ARTICLE VII Mandated Appropriation In order for the Municipal Investment Board to operate effectively and ultimately serve the purpose for which it has created, an initial amount of TWO HUNDRED THOUSAND PESOS (P200,000.00) shall be appropriated which shall be taken from the Municipal Internal Revenue Allocation and/or Municipal Development Funds. Thereafter, the Municipal Government shall annually appropriate funds in the amount of Two Hundred Thousand Pesos (P200,000.00) for three (3)-year period. ARTICLE VIII Repealing, Separability Clause and Penal Provision SECTION 1. Repealing Clause . This Ordinance hereby repeals all other ordinances and resolutions inconsistent with any provision of this Code. SECTION 2. Separability Clause . The provisions of this Ordinance are hereby declared separable. Should any provisions herein be declared unconstitutional and unlawful, the invalidity of one or more provisions shall not affect the validity of other provisions thereof. SECTION 3. Judicial Relief . All orders or decisions of the Board/Municipal Government in case involving the provisions of this Ordinance shall immediately be executory. Any appeal or petition from the aggrieved party adversely affected by this Ordinance may be filed in the proper court. SECTION 4. Penal Provision . Any misrepresentation or violation of any provision of this Ordinance shall carry a fine of Two Thousand Five Hundred Pesos (P2,500.00) or an imprisonment of not more than three (3) months, or both, at the discretion of the court. ARTICLE IX Effectivity This Ordinance shall take effect Ten (10) days after its approval and publication once in a local newspaper of general circulation in the Province of Cotabato and/or after posting in the Bulletin Board at the Municipal Building or in conspicuously and publicly accessible places in the municipality for three (3) consecutive weeks. ADOPTED UNANIMOUSLY , December 8, 2017. I hereby certify to the correctness of the above-quoted resolution. DANILO B. GASCAL, MPA Secretary to the Sangguniang Bayan ATTESTED AND CERTIFIED TO BE DULY ADOPTED: RICKY A. CUA, DDMG Vice Mayor/Presiding Officer APPROVED: RUDY S. CAOAGDAN, DPA Municipal Mayor Date: ____________ n Note from the Publisher: Copied verbatim from the official copy. Missing Section 3.