(a) Develop and maintain a Philippine Metropolitan Marine composed of well-equipped, safe and modern vessels most suited for, Philippine requirements and conditions, manned by qualified Filipino officers and crew, and owned and operated under the Philippine flag by citizens of the Philippines or by associations or corporations organized under the laws of the Philippines, at least sixty percent (60%) of the capital of which is owned by citizens of the Philippines; 
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(b) Assist in the development, recovery and expansion of Philippine overseas shipping capable of meeting the requirements of the expanding international trade of the Philippines; 

(c) Provide assistance to Philippine Shipping enterprises and encourage the long range vessel acquisition development modernization and expansion through private investments without direct government financial assistance; and 

(d) Create a Healthy climate to attract private enterprises. 

(a) "Philippine overseas shipping" means the transport of goods and/or passengers by a ship owned and operated under the Philippine flag by a Philippine shipping enterprise, except when the ship is operated solely between ports in the Philippines; 

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(b) "Philippine shipping enterprise" means a citizen of the Philippines or an association or corporation organized under the laws of the Philippines, at least sixty percent (60%) of the capital of which is owned by citizens of the Philippines and engaged exclusively in Philippine overseas shipping;

(c) "MARINA" means the Maritime Industry Authority; chan robles virtual law library

(d) "Monetary authority" means the Central Bank of the Philippines and any other agency in charge of foreign exchange controls; and 

(e) "Regulation" means the rules and regulations promulgated pursuant to Section 10 hereof. 

(a) The funds utilized in the acquisition of the vessel are financed from sources other than the Philippine banking system; 

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(b) No guaranty of the monetary authority or of any Philippine government or private financial institution is granted or extended for the purpose; chan robles virtual law library

(c) The vessel serves as sole collateral for the financing of the vessel and no other asset of the Philippine shipping enterprise is pledge, mortgaged, or used as security in case of default;

(d) All foreign exchange requirements for the servicing of the loan, the operation, maintenance and repair of the vessel, the purchase of supplies and related equipment shall be financed solely from earnings derived from the operation of the vessel and no foreign exchange shall be made available by the monetary authority and the Philippine banking system for these purposes; 

(e) Mortgage documents and/or other financial agreements shall be filed with the monetary authority and such other government agencies in charge of such mortgage formalities; and chan robles virtual law library

(f) Any excess foreign exchange earning shall be inwardly remitted and surrendered to the Philippine banking system.

(a) A Philippine dry-docking or repair facility, accredited by the MARINA and registered as a customs-bonded warehouse, which will undertake the necessary repairs and works on the vessel; and chan robles virtual law library

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(b) The vessel in which the items are to be installed: Provided That, if such items are found in locations other than the two (2) aforementioned ones or in places not authorized by customs, the person or entity in possession of such items shall be subject to full duties and taxes, including surcharges and penalties.

(a) The entire net income, after deducting not more than ten percent (10%) thereof for distribution of profits or declaration of dividends, which would otherwise be taxable under the provisions of Title II of the National Internal Revenue Code, is reinvested for the construction, purchase, or acquisition of vessels and related equipment and/or in the improvement of modernization of its vessels and related equipment in accordance with the regulations; and chan robles virtual law library

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(b) The cumulative amount so reinvested shall not be withdrawn for a period of ten (10) years after the expiration of the period of income tax exemption or until the vessel or related equipment so acquired have been fully paid, whichever date comes earlier.chanrobles virtual law library 

(a) No other Philippine shipping enterprise is interested in acquiring the vessel; or chan robles virtual law library

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(b) The vessel has to be scrapped.chanrobles virtual law library 

(a) The fair market value, if the vessel is taken absolutely, or 

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(b) The fair charter value, if the vessel is taken temporarily.chanrobles virtual law library 

(a) One (1) member to be appointed by the MARINA; chan robles virtual law library

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(b) One (1) member to be appointed by the owner or operator of the vessel; and chan robles virtual law library

(c) One (1) member to be appointed by the two (2) members so appointed. 

(a) The amount of foreign exchange earned, acquired and spent by Philippine shipping enterprises;chan robles virtual law library

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(b) The amount of income tax and import duties and taxes for which exemption have been granted; 

(c) The additional oceangoing vessels constructed, purchased or acquired, the improvement made thereon and the additional related equipment procured; and 

(d) Such other information as the MARINA may deem necessary or the President of the Philippines may require.