J. V. Ong

December 2, 1980 J. V. Ong Tax Division Sycip, Gorres, Velayo & Co. P.O. Box 589, Manila Sir : This has reference to your letter dated August 11, 1980 requesting the opinion of this Commission on the question posed therein. LexLib It appears that your client, Chesebrough-Pond's International Capital Corporation, a multinational company and subsidiary of Chesebrough-Pond's Inc. which is organized and existing under the laws of U.S.A., is duly registered as a regional headquarters under Presidential Decree No. 218. Chesebrough-Pond's Inc. has a branch office in the Philippines. The alien executives of your client intend to sign checques drawn against Chesebrough-Ponds, Philippine branch. You want to know if such arrangement will not violate Section 8 (b) (2) of PD 218 which requires that a regional office, " . . . will not participate in any manner in the management of any subsidiary or branch office it might have in the Philippines." Based on the foregoing facts, we concur with your statement that the Philippine branch of Chesebrough-Pond's Inc. "is neither a branch nor a subsidiary of CPICC." Considering that the prohibition of PD 218 refers to regional headquarters in relation to its subsidiary or branch office, this Commission holds the view that this decree does not apply to the abovementioned arrangement between your client and Chesebrough-Pond's Philippine branch. Moreover, upon the verbal representation of your firm that the signing of checques would constitute only as part of your client's close supervision over the Philippine branch and, as such, falls within the corporate acts of regional offices allowed under PD 218, we interpose no objection thereto. cdlex Very truly yours, (SGD.) ROSARIO N. LOPEZ Director Corporate and Legal Department