MEMORANDUM CIRCULAR No. 2015-01
TO: ALL BOI CLIENTS AND ALL OTHERS CONCERNED
SUBJECT: GENERAL POLICIES AND SPECIFIC GUIDELINES TO IMPLEMENT THE INVESTMENT PRIORITIES PLAN (IPP) 2014-2016
A. PREFATORY STATEMENT
In line with the Administration’s thrust of creating a more dynamic and progressive Philippines, the President issued Memorandum Order No. 74 dated 28 October 2014 approving the 2014 Investment Priorities Plan (IPP), which is centred on the theme “Industry Development for Inclusive Growth.” A fundamental investment policy tool of the DTI-BOI’s industry development strategy, the 2014 IPP is a strategic plan to grow industries, not just or necessarily through incentives, but through other policy interventions and initiatives. The IPP undertakes to address the most binding constraints to the entry of new investments and moving up the value chain to enhance the local industries’ competitiveness while creating a competitive market.
The 2014 IPP is a rolling three-year plan to ensure continuity, consistency and predictability – factors seriously considered by domestic and foreign investors. This new IPP will, however, be reviewed annually over the three-year period.
Therefore, notice is hereby given that the Board approved the following General Policies and Specific Guidelines to implement the 2014 IPP.
B. GENERAL POLICIES
I. APPROVAL OF APPLICATION AND ENTITLEMENT TO INCENTIVES
The approval of application for registration and entitlement to incentives under this IPP is subject to Article 7, paragraph 3 of Executive Order (E.O.) No. 226.
The approval of applications for registration shall be based on the IPP listing. However, the extent of entitlement to incentives shall be based on the project’s net value-added, job generation, multiplier effect and measured capacity.
The BOI, if national interest requires, may deny registration of projects engaged in the export of a product including industry inputs that are in short supply domestically.
II. EQUITY OWNERSHIP
Except as provided for under the Constitution and the Foreign Investments Act of 1991 (Republic Act No. 7042, as amended), there are no restrictions on foreign ownership of export-oriented and/or pioneer enterprise that will engage in the activities listed in the IPP.
III. EQUITY REQUIREMENT
The minimum equity of the project applied for registration is 25% of the project cost unless exempted under any of the following:
- Projects of applicants with good track record in implementing registered projects;
- Projects of publicly-listed companies; or
- Projects not entitled to ITH.
For projects with a gestation period of more than three (3) years, the 25% equity requirement shall be based on the annual capital requirement of the project; Provided that the total equity requirement of 25% is complied with on the first year of ITH availment. Non-compliance with this policy shall result in forfeiture of ITH incentives for the taxable year.
For multi-phase projects, the 25% equity requirement shall be based on the annual capital requirement of each phase; Provided that the total equity requirement for the first phase is complied with on the first year of ITH availment; and the corresponding cumulative equity requirement for the succeeding phases is complied with on the first ITH availment of each succeeding phase thereafter. Non-compliance with this policy shall result in forfeiture of ITH incentives for the taxable year.
IV. PROJECT STATUS
Pioneer status with pioneer incentives shall be governed by Article 17 of E.O. 226.
V. GEOGRAPHICAL CONSIDERATION IN INDUSTRY DEVELOPMENT POLICY
The BOI shall include geographical considerations in evaluating projects to be qualified for incentives based on, among others, regional development plans, industry roadmaps, industry clustering strategies and other relevant government initiatives to fill in the gaps of supply chains, enhance competitiveness, and promote global value chains.
A. Regional Dispersal of Industries
The dispersal of economic activities to the countryside is encouraged.
Projects in any of the identified less developed areas (LDAs) listed in Annex A shall be entitled to pioneer incentives and additional deduction from taxable income equivalent to 100% of expenses incurred in the development of necessary and major infrastructure facilities unless otherwise specified in the Specific Guidelines.
B. Locational Restriction in NCR
The BOI shall limit incentives to firms that locate in congested urban centers. The locational restriction applies to the National Capital Region (NCR) wherein projects are not entitled to ITH. Exemption from the above locational restriction, however, may be given to the following:
- Projects in government industrial estates* declared by national law or presidential proclamation prior to 01 January 1989 (unless subsequently privatized);
- Projects that will engage in service type activities;
- Expansion of export-oriented projects effected within the firm’s existing premises; and
- Modernization projects.
*Dagat-Dagatan (P.D. No. 569 dated 30 October 1974); Vitas Industrial Estate, Tondo (E.O. No. 1086 dated 31 January 1986, as amended/expanded through Presidential Proclamation No. 39 dated 09 September 1992 and Proclamation No. 465 dated 01 August 1994) (Vitas Industrial Estate/Smokey Mountain); Bagong Silang Industrial Estate, Caloocan City (Presidential Proclamation No. 843 dated 26 July 1971); Food Terminal Inc., Taguig (LOI No. 900 dated 25 July 1979); Navotas Fishing Port Complex (E.O. No. 772 dated 08 February 1982).
VI. EXPORT OF PRODUCTS IN SHORT DOMESTIC SUPPLY
The export commitment of a registered enterprise may be suspended to satisfy national interest or in an emergency situation.
VII. ITH AVAILMENT
A. General Rules
1. In the grant of incentives, the Board shall give priority to projects with substantial benefits to the economy. In this regard, the extent of the project’s ITH entitlement shall be based on the following parameters: (1) project’s net value added, (2) job generation, (3) multiplier effect, and (4) measured capacity.
In the event that the registered enterprise fails to implement the project as represented in its project application, the Board may opt to reduce the project’s ITH availment proportionate to the actual performance (e.g. investments, employment generation, production and sales, timetable) of the enterprise.
The income qualified for ITH shall be limited to the income directly attributable to the eligible revenue generated from registered project.
2. Except for renewable energy projects, the basis of net income qualified for ITH shall be limited to the 110% of the projected gross revenues as represented by the firm in its application for registration.
In cases where the project’s actual revenues exceed the projections in its application due to, e.g., new markets/orders, additional employment/shifts, additional investments, the Board may increase the project’s ITH availment proportionately. Request/s for adjustments of projected revenue must be filed before the projected revenue is exceeded, otherwise ITH on the excess revenue (i.e. in excess of 110% of the projected gross revenue) shall not be granted.
3. ITH shall only be applicable to revenues on sales generated/services rendered to other enterprises. For projects involving services inherent to a project’s operation (e.g. air cooling and similar activities), entitlement to ITH shall be subject to the condition that 70% of the revenues are generated from non-related entities and service fees are within normal/ regular rates.
4. Only net income from operation of registered activity as certified under oath by CEO or CFO shall be entitled to ITH.
5. Enterprises with multiple registrations with the Board and/or several activities (whether BOI-registered or not) shall submit a list of cost items that are common with the qualified project and their cost allocation methodology for the said cost items, to ensure proper, fair and equitable allocation of common cost such as overhead and administrative costs.
B. Base Figure and Rate of Exemption
In general, ITH of expansion projects are subject to a base-figure equivalent to the enterprise’s highest sales volume in case of homogenous products or sales value in case of heterogeneous products, in the last three (3) years, prior to the filing of the application for registration of the project.
Projects registered under the modernization program without increase in capacity may be entitled to three (3) years ITH and other incentives without prejudice to compliance with other requirements. The computation of ITH for projects without increase in capacity is as follows:
For single product/activity: (New Investment (in US$) / Total Investments (replacement cost + new) Relative to the Concerned Plant (in US$)) x 100 = Rate of Exemption (ROE)
For multiple products/ activities or when ITH period of other products/ activities has lapsed:
(Sales arising from the modernization project / Total Sales) x 100 = % Sales Entitled to ITH
(New Investment (in US$) / Total Investments (replacement cost + new) Relative to the concerned plant (in US$)) x 100 = ROE
- ROE shall be fixed for the ITH entitlement period.
- Exchange rate shall be the existing rate at the time of actual investment or time of availment of ITH whichever will result in lower rate of ITH.
- Replacement cost shall refer to the appraised value of its Fixed Assets relative to the concerned plant in the first year of ITH availment duly assessed and certified by an Independent Appraiser accredited by the Bangko Sentral ng Pilipinas. This shall thereon be used as a basis in succeeding ITH availments until the end of the ITH entitlement period of the project.
- % Sales Entitled to ITH shall be based on actual sales values for the year of availment.
C. Availment of ITH Bonus Year
New registered pioneer and non-pioneer enterprises and expansion enterprises granted pioneer incentives under Art. 40(a) of E.O. 226 may be granted one (1) additional year of ITH incentive for each of the following criterion:
1. Capital Equipment to Labor Ratio Criterion
- Formula: Derived $ cost of capital equipment / Average number of direct labor ≤ US$10,000.00
- The acquisition cost of the machinery and equipment pertaining to the registered activity covering the taxable year immediately preceding the period applied for extension and not the depreciated cost shall be used and, in converting the value of equipment from pesos to dollars, the average foreign exchange rate at the time of acquisition shall be used.
- The direct labor count shall represent an average of the month end labor count for the same taxable year as represented in b.
- On the year of the actual availment of the ITH bonus year, the firm must still comply with the capital equipment to labor ratio criterion to be entitled to it.
2. Net Foreign Exchange Earnings/Savings Criterion
- Foreign Exchange Earnings is the total foreign exchange proceeds from the export of the registered product or services while Foreign Exchange Savings is the local sales of the registered product (must be justified as an import substitute) equivalent to the foreign exchange costs of the said product had these been imported.
- The export sales/local sales of import substitutes or the derived average foreign exchange earnings/savings less the foreign exchange costs/expenses for the first three years of commercial operation should at least be US$500,000.00.
- Foreign exchange costs/expenses include imported raw materials, imported supplies/spare parts, depreciation of imported machinery/equipment, among others.
3. Indigenous Raw Material Cost Criterion
- Formula: (Cost of Indigenous Raw Materials / Total Cost of Raw Materials) x 100% ≥ 50%
- Indigenous Raw Materials and/or intermediate indigenous products must be used as inputs in the manufacturing or processing of the registered product. The derived ratio should not be lower than fifty percent (50%) for each taxable year beginning the start of commercial operation up to when the extension using this criterion was applied for.
- Lists of indigenous raw materials and Intermediate indigenous products are provided in Annex B.
- On the year of the actual availment of the ITH bonus year, the firm must still comply with the indigenous raw material cost criterion to be entitled to it.
D. Projects With Government Guarantee
Projects with government guarantee/subsidy are not entitled to ITH except in cases where ITH has been considered in the rates/tariffs approved by the regulatory agency concerned.
The ITH is deemed to have been imputed in the grant of the government guarantee/subsidy if the ITH was incorporated in the bid documents of the project proponent/contract with government on the project, or the ITH was included in the financial model by the regulatory agency in approving the project’s tariffs/rates. The latter case is particularly applicable to power projects and thus, subject to a certification by the Energy Regulatory Commission (ERC).
VIII. MULTI-PHASE PROJECTS
Projects of an enterprise with multiple phases/locations may be registered on a per phase/location.
IX. INCLUSIVE BUSINESS
Registered enterprises are encouraged to adopt the Inclusive Business (IB) strategy that provides: a) goods and services; and b) income and decent work opportunities for the low-income segment of the society within the enterprise’s supply or value chain directly contributing to the improvement of living standards and poverty reduction.
The IB strategy of the registered enterprise may be accredited by the Board subject to the guidelines that will be issued by the Board separately.
X. CORPORATE SOCIAL RESPONSIBILITY (CSR)
BOI registered entities, recognizing the benefits derived from the fiscal incentives granted by the government, should endeavour to undertake meaningful and sustainable CSR projects in the locality where the projects are implemented.
XI. GOOD CORPORATE GOVERNANCE
BOI registered enterprises must be committed to the tenets of Good Corporate Governance. Boards must function properly in decision-making processes that affect their stakeholders.
XII. SUPPORT TO ENVIRONMENTAL PROTECTION AND CONSERVATION
Registered enterprises shall adopt measures intended to reduce climate change risks in support of the National Framework Strategy on Climate Change.
Likewise, registered enterprises are encouraged to implement best practices to protect and conserve biodiversity in their respective area and/or activities, and promote biodiversity-friendly businesses.
New and expansion projects shall be required to secure an Environmental Compliance Certificate (ECC) pursuant to P.D. No. 1586 (Philippine Environmental Impact Statement System) and other clearances under relevant environmental laws.
A Certificate of Non-Coverage (CNC) issued by the Environmental Management Bureau (EMB) shall be submitted for projects that are not critical to the environment.
Applicants for BOI registration must submit proof of application for ECC/CNC filed with DENR.
Registered enterprises are encouraged to participate in the Philippines’ Eco-labeling Program (ELP), when applicable.
Registered enterprises are encouraged to secure environmental certifications based on internationally-recognized standards, whenever applicable.
XIII. INTERNATIONAL STANDARDS CERTIFICATION
Registered enterprises shall obtain applicable certifications based on internationally-recognized standards such as a Hazard Analysis and Critical Control Points (HACCP), ISO certification, quality standards (e.g. ICC, CE) or other similar certifications.
Registered enterprises shall use brand new equipment except for projects utilizing consigned equipment, projects involving transfer of facilities, and when specified in the Specific Guidelines, and apply production processes that meet environmental standards. Application for availment of capital equipment incentive shall be filed prior to the ordering of equipment.
XV. PROJECTS IN THE AUTONOMOUS REGION IN MUSLIM MINDANAO (ARMM)
The ARMM List covers priority activities that have been identified by the Regional Board of Investments of the ARMM (RBOI-ARMM) in accordance with E.O. No. 458. The RBOI-ARMM may also register and administer incentives to activities in this IPP for projects locating in the ARMM.
Projects in the ARMM should register with the BOI-ARMM.
XVI. PROJECTS WITH REVENUES DERIVED FROM CARBON CREDITS PURSUANT TO THE KYOTO PROTOCOL
Revenues from the sale of carbon credits through certified emission reduction (CER) units generated from registered activity may be considered as part of the income entitled to ITH, provided that the enterprise made representation at the time of application for registration that such projects would earn CER units.
XVII. OUTSOURCING OF PRODUCTION PROCESS OR SERVICES
Portion/s of the production process or services of the registered activity may be outsourced provided that the core activity or the integrated nature of operation is undertaken by the registered enterprise.
XVIII. PUBLIC WELFARE CONSIDERATION
The BOI may deny applications for registration and/or grant of incentives for reasons of public health or morals or for environmental considerations.
C. DEFINITION OF TERMS
a) Alternative Fuel Vehicles – refer to vehicles that run on electric batteries, flexible fuels, hybrid systems.
b) Book – a printed non-periodical publication of at least forty-eight (48) pages, exclusive of cover pages, published in the country and made available to the public.
c) Content Development of Books consists of the following:
- Development of new technologies directly related to book printing or publishing, such as but not limited to digitization, electronic books (E-books), internet-based archiving and retrieval systems, electronic content creation and development systems, educational and/or “how-to” audio-visual presentations with or without interactive segments, and the like.
- Research and development activities directly related to book printing or publishing, such as but not limited to translation, editing, analysis and/or interpretation of text and materials into local dialects or adaptation/application to the domestic setting.
d) Copy – refers to the certified true copy of the original document.
e) Distribution – refers to bunkering and fuels shipping and transport. Fuels shipping and transport cover shipping and transport through land such as tank trucks, lorries and pipeline and tankers, and barges for the fuels to get to the points or areas where they are needed. Bunkering covers the activity of selling fuel for direct use by a vessel, usually for water and air transport, through a smaller transport vessel. Distribution projects are limited to those acquiring brand new equipment.
f) Electric vehicles – refer to vehicles that run solely on electric power.
g) Energy crops – refer to plants that may be used as feedstock for biofuels and/or power generation. These include grass, bamboo, leguminous tree species, sugarcane, sweet sorghum, cassava, algae, coconut, and oil palm and other crops as may be identified by the DOE.
h) Existing Project – refers to a project of an existing enterprise that has started commercial operation at the time of application with the Board.
i) Expansion Project – refers to a project of an existing enterprise that would involve the installation of additional facilities/equipment that will result in increase in capacity of the same/similar activity within the same existing plant/facilities of the enterprise. Projects that do not qualify as new shall be considered as expansion.
j) Flexible-fuel vehicles – refer to vehicles that run on gasoline/diesel in combination with alternative fuel such as but not limited to:
- Bioethanol vehicles that run on gasoline and a minimum ethanol content/blend of at least 20%
- Biodiesel vehicles that run on diesel and a minimum biodiesel blend/content of at least 5%
- Compressed Natural Gas Vehicles are vehicles that run on Compressed Natural Gas (CNG)
- Other vehicles powered by LPG, fuel cell and other alternative fuels
k) General Hospital – refers to a hospital with Levels 1, 2 or 3 that provides services for all kinds of illnesses, diseases, injuries, or deformities. It shall provide medical, surgical, maternity, newborn, and child care. It shall employ Board-certified/eligible medical specialists and other licensed physicians.
l) General Hospital Level 1 – refers to a hospital that has the following:
- Staff of qualified medical, allied medical and administrative personnel headed by a physician duly licensed by Professional Regulation Commission (PRC);
- Operating room with standard equipment and provision for sterilization of equipment and supplies;
- Post-operative recovery room;
- Maternity facilities consisting of ward(s), room(s), a delivery room, exclusively for maternity patients and newborns;
- Isolation facilities with proper procedures for the care and control of infections and communicable diseases;
- Separate dental section/clinic;
- Blood station;
- DOH licensed secondary clinical laboratory with the services of a consulting pathologist;
- DOH licensed level 1 imaging facility with the services of a consulting radiologist;
- DOH licensed pharmacy.
m) General Hospital Level 2 – refers to a hospital that has, as minimum, all of Level 1 capacity including the following:
- An organized staff of qualified and competent personnel with Chief of Hospital/Medical Director and appropriate Board-certified Clinical Department Heads;
- General ICU for critically-ill patients;
- Provision for Neonatal Intensive Care Unit (NICU);
- Provision for High Risk Pregnancy Unit (HRPU);
- Provision for respiratory therapy services;
- DOH licensed tertiary clinical laboratory;
- DOH licensed level 2 imaging facility with mobile x-ray inside the institution and capability for contrast examinations.
n) General Hospital Level 3– refers to a hospital that has, as minimum, all of Level 2 capacity including the following:
- Teaching and/or training hospital with accredited residency training program for physicians in the four (4) major specialties namely: Medicine, Pediatrics, Obstetrics and Gynecology, and Surgery;
- Provision for physical medicine and rehabilitation unit;
- Provision for ambulatory surgical clinic;
- Provision for dialysis facility;
- Provisions for blood bank;
- DOH licensed tertiary clinical laboratory with standard equipment/reagents/supplies necessary for the performance of histopathology examinations;
- DOH licensed level 3 imaging facility with interventional radiology.
o) Government Guarantee – refers to the rate of return granted by the regulating agency to include profit and the recovery of capital expenditure (guaranteed rate of return), assured payment whether or not services/product were produced/delivered (take or pay provision), and assurance to lender by a government agency that a financial obligation will be honored even if the borrower is unable to repay the debt.
p) Government Subsidy – refers to the financial contribution by the national government or any of its agencies to defray, pay for or shoulder a portion of the project cost or the expenses and costs in operating or maintaining the project.
q) Inclusive Business – are those profitable core business activities that deliberately target the low-income segment (below US$3/day) as part of their value proposition. IB creates or expands access to goods, services, and livelihood opportunities for the poor and vulnerable in commercially viable and scalable way.
r) Integrated Circuit – refers to a semiconductor device that holds a number of electronic components that are internally connected to form a larger electronics circuit which can operate either using analog or digital technology.
s) Logistics Efficiency Index – refers to the measure of cost efficiency of the logistics involved in the supply of motor vehicle parts and components for the enrolled Model. It is computed as follows:
LEI = (Nf – Na) / (Nf – Nt)
Where: Na = annual volume of imported parts (m3) / total annual production (units)
Nf = total m3 of parts for one complete vehicle
Nt = total m3 of part/unit that are deemed too technology- or investment-intensive and that cannot be viably manufactured in the country
t) Job Generation – refers to the number of jobs directly generated by the project regardless of the length of employment.
u) Marketing of Petroleum Products/Natural Gas covers the following:
- Retailing or selling in retail generally directed to the end users, through dispensing pumps in stations or in packaged containers such as drums for the liquid fuels or metal cylinders that are compliant with PNS. This includes the establishment and operation of gasoline/natural gas stations and retailing.
- Fuels bulk marketing or selling in wholesale through tank trucks, lorries, double-hulled vessels/tankers, barges or pipelines, which may be sourced from one’s own storage facilities. Investment shall include underground tanks and other equipment intended for fuels retailing through outlets such as gasoline/natural gas stations and LPG/LNG outlets.
- A combination of storage, distribution, and marketing activities.
v) Measured Capacity – the estimated additional volume of production/ service which the Board determines to be desirable in each preferred area of investment taking into account the export potential of the product. For housing projects, the estimated housing backlog for units between four hundred fifty thousand and three million pesos (economic and low-cost housing) in the country shall be the basis of measured capacity.
w) Metro Cebu – is composed of Cebu City, Lapu-Lapu City, Mandaue City, Cordova, Consolacion, Liloan, Compostela, Talisay, Minglanilla, and Naga.
x) Metro Davao – is composed of Davao City and the adjoining towns of Panabo and Sta. Cruz.
y) Modernization Project – refers to a project of an existing enterprise that would involve improvements in systems, processes, equipment, and/or facilities that must result in any of the following:
- At least 25% substantial reduction of production cost/cost of provision of the service; or
- Upgrading of product/service quality or classification of the facility (e.g., hospitals, hotels, resorts) to a higher class in accordance with accreditation standards applicable to the industry concerned.
z) Motorcycle – refers to conventionally-powered two or three-wheeled vehicle fitted with an auxiliary motor, with or without sidecars.
aa) Multiplier Effect – refers to the increase in economic activity and interrelationships generated and stimulated by the investment.
bb) New Plantation Area – refers to new hectarage of plantation or lands that have been idle for at least one year or those involving change of crops/variety to achieve higher yield or shifts in the production system such as organic farming.
cc) New Project – refers to a project/activity listed in the IPP that has not started commercial operation undertaken by:
- An existing enterprise that shall engage in:
- an entirely distinct and different activity from its existing business operations; or
- the same activity provided it shall establish a new facility (i.e., new complete line used in the production of the registered product/service separate from existing line) in an area not contiguous to the premises of its existing project and with new investments.
- A newly organized/formed enterprise that:
- has no common stockholders in any existing enterprise, or
- has common stockholders in the existing enterprise but own not more than fifty percent (50%) of equity in the new enterprise, or
- has common stockholders but will engage in an entirely distinct and separate activity, or
- has common stockholders (regardless of percentage of common ownership) and will engage in the same activity as that of the existing enterprise but will locate in a different municipality, province, or region.
- An enterprise involving the manufacture of products utilizing local R&D. Applications for registration utilizing local R&D must be endorsed by the Department of Science and Technology (DOST) stating that this was undertaken in the Philippines and has not yet been commercialized.
- For industrial tree plantations, an enterprise involved in the development of any public or private land to plantation of timber and non-timber species to supply the raw material requirements of forest-based industries. It also includes plantation with existing tree crops, which have not yet reached commercial harvest.
dd) Net Value-added – refers to the value of final product/service less the value of inputs. The project’s net value added should be at least 25% except for projects dependent on imported raw materials/ supplies.
ee) Original Text with Annotations – refer to written works where the original text is augmented with annotations, such as additional comments, highlights, evaluation, or explanation, that are provided by the same or another author for the purpose of further analyses and understanding of the said original text by a specific audience.
ff) Original Works – are original intellectual creations in the literary and artistic domain protected from the moment of their creation and shall include in particular books, pamphlets, articles and other writings.
gg) Other Health Facilities – shall refer to the following:
- Custodial Care Facility – a health facility that provides long-term care, including basic human services like food and shelter to patients with chronic or mental illness, people requiring ongoing health and nursing care due to chronic impairments and a reduced degree of independence in activities of daily living.
- Diagnostic/Therapeutic Facility – a facility that examines the human body or specimens from human for the diagnosis, sometimes treatment of diseases.
- Specialized Out-patient Facility – a facility with highly competent and trained staff that performs highly specialized procedures on an out-patient basis; examples are, but not limited to the following: (i) Dialysis Clinic, (ii) Ambulatory Surgical Clinic, (iii) Oncology Chemotherapeutic Center/Clinic, (iv) Radiation Oncology Facility, (v) Physical Medicine and Rehabilitation Center / Clinic.
- Geriatric Care Facilities.
hh) Phase – a distinct period or stage pertaining to the development or operational capacity of a project
ii) Specialty Hospital – refers to a hospital that specializes in a particular disease or condition or in one type of patient. A specialized hospital may be devoted to treatment of any of the following:
- Treatment of particular types of illness for a particular condition requiring a range of treatment. Examples of these hospitals are Philippine Orthopedic Center, National Center for Mental Health, San Lazaro Hospital, and hospitals dedicated to the treatment of cancer.
- Treatment of patients suffering from diseases of a particular organ or groups of organs. Examples of these hospitals are Lung Center of the Philippines, Kidney and Transplant Institute, and hospitals dedicated to treatment of eye disorders.
- Treatment of patients belonging to a particular group as children, women, elderly and others. Examples of these hospitals are Philippine Children’s Medical Center, National Children’s Hospital, and Dr. Jose Fabella Memorial Hospital.
jj) Start of Commercial Operations – shall be the date specified in the project study submitted to the Board or the date when a particular enterprise actually begins production of the registered product for commercial purposes or commercial harvest in the case of agricultural activities, whichever comes first, irrespective of phases or modules or schedule of development. In the case of service oriented activities, it shall mean the date when a particular registered enterprise begins catering to or servicing its clients on a commercial basis. In the case of export traders and service exporters, the term shall mean the date when the initial export shipment in commercial quantity has been made or initial performance of service as borne out by the appropriate supporting documents.
For renewable energy projects (RE), start of commercial operations shall refer to the state at which the RE Plant generated the first kilowatt-hour of energy after commissioning or testing, or two (2) months from the date of such commissioning or testing, whichever comes earlier, as certified by the DOE.
kk) Storage – refers to the business of receiving/discharging and storing petroleum crude and/or products of others for compensation or Storage projects are limited to those establishing new facility, i.e., depot or storage tanks.
ll) Trial Operation – refers to the initial pre-commercial phase based on 10% of the annualized sales vis-à-vis the first year of the project’s projected revenues. This shall not apply to energy projects.
mm) TSD (Treatment, Storage, and Disposal) Facilities – are the facilities where hazardous wastes are stored, treated, recycled, reprocessed, or disposed of.