Aquino expands list of foreign investment limitations
MANILA, Philippines - President Benigno Aquino III has expanded the list of investment areas and economic activities that prohibit the participation of foreign investors under the 9th Regular Foreign Investment Negative List.
The said list enumerates the industries and business activities that are open to Filipino businessmen, and defines the extent of participation of foreign investors in areas allowed by specific laws and the Constitution.
Aquino signed Executive Order No. 98 on October 29, Executive Secretary Paquito Ochoa Jr. said on Friday. The order, which also expands investment opportunities reserved for Filipinos, replaces E.O. 858 that started to take effect in February 2010.
EO No. 98 takes effect 15 days after its publication in a newspaper of general circulation.
“There are investments areas or activities which foreign ownership limitations imposed by law were not included in EO 858. Those changes are now reflected in the ‘List A’ of the new presidential directive,” Ochoa said.
Ochoa said among E.O. 98's amendments to E.O. 858 are:
- The foreign ownership and foreign practice limitations imposed under the Real Estate Service Act of the Philippines (Republic Act 9646);
- The Philippine Respiratory Act (R.A. 10024);
- The Philippine Psychology Act (R.A. 10029) and
- The Lending Company Regulation Act of 2007 (R.A. 9474)
Except for R.A. 9474, which allows foreign ownership of up to 49 percent in lending companies, the three other laws limit the practice of non-Filipinos in the areas of real estate and health care such as respiratory therapy and psychology, unless there is a reciprocity arrangement prescribed by a law.
List A of EO No. 98 specifies the areas of economic activity where foreign ownership is prohibited or limited by the Constitution or laws, among them:
- mass media
- practice of all professions, cooperatives
- private security agencies
- small-scale mining
- private radio communications network, private recruitment for local or overseas employment
- advertising
- ownership of private lands,
- lending companies,
- financing companies and investment houses regulated by the Securities and Exchange Commission
List B contains economic activities regulated by law such as:
- small- and medium-scale domestic enterprises
- defense-related industry (i.e., manufacture of firearms, etc.) and
- businesses that have implications on public health and morals (i.e., gambling, sauna, massage clinics, etc.)
List A may be amended any time to reflect changes brought about by new laws, according to Ochoa.
List B may be amended not more than once every two years upon the recommendation of the departments concerned and endorsed by the National Economic and Development Authority, or upon NEDA’s own initiative and recommendation, approved by the President and promulgated by a presidential proclamation.
“For now, List B stays while the changes to the negative list covers only List A,” Ochoa said.
Under the Foreign Investments Act of 1991 (R.A. 7042), foreign investors are allowed to own 100-percent equity in businesses excluded from the negative list.
Article Source: Philippine News Agency, InterAksyon
