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BATAS PAMBANSA BILANG. 44BATAS PAMBANSA BLG. 44 - AN ACT TO
PROMOTE INVESTMENTS IN LESS DEVELOPED AREAS
(REPEALED BY EXECUTIVE ORDER NO. 226, S. 1987)
Section 1. Title.
— This Act shall be known as the Investments Promotion Act for Less
Developed Areas.
Sec. 2. Declaration of Policy. — In line with the
policy of equitable distribution of wealth and balanced national
economic growth and development, it is hereby declared as the policy of
the State to encourage investments and to assist the establishment and
development of industrial and agricultural projects to generate
employment and raise the standard of living in less developed areas.
Sec. 3. Definition of Terms. — For the purposes of
this Act:
(a) "Board" shall refer to the Board of Investments
created under Republic Act 5186, as amended.
(b) "Less Developed Area" shall refer to specific
localities within the country appearing in the "Less Developed Areas
List" prepared jointly by the Ministry of Industry, the Ministry of
Human Settlements, and the National Economic and Development
Authority.
(c) "Less Developed Area Registered Enterprise" shall
mean enterprises located in an identified less developed area and
registered with the Board under either Republic Act 5186 or 6135 or
Presidential Decree 1159 or this Act for incentive advisement in
industrial and agricultural activities listed in the priorities plans
of the Board.
Sec. 4. Additional Investor's Incentives in a Less
Developed Area Registered Enterprise. — An investor in a less developed
areas registered enterprise, in addition to the investors' incentive
provided under Republic Act 5186 or 6135 or Presidential Decree 1159,
shall, subject to the nationality requirements provided under the said
laws, be entitled to an investment allowance to the extent of his
actual investment, paid in cash or property, as a deduction from his
taxable income but not to exceed thirty per cent (30%) thereof,
inclusive of the normal tax allowance under its law of registration:
Provided, (1) That this incentive shall not apply to investments in
mining ventures; (2) That the investment is made in subscription of
shares in the original and/or increased capital stock of an enterprise
within seven years from the date of registration as a less developed
area registered enterprise; (3) That the shares are held for a period
of not less than three years; and (4) That the investment is registered
with the Board and deemed necessary by the Board for setting up the
business or expanding or strengthening an existing business already
located or proposed to be transferred to a less developed area. If the
shares are disposed of within the said three-year period, the taxpayer
shall lose the benefit of this deduction, his income tax liability
shall be recomputed, and he shall pay the same and whatever additional
sum be due, plus interest thereon, within thirty days from the date of
disposition. A surcharge shall be imposed thereon in the event of
failure to pay the obligation within the said period.
Sec. 5. Additional Incentives to Less Developed
Area Registered Enterprises. — An enterprise in a less developed area
registered with the Board under either Republic Act 5186 or 6135 or
Presidential Decree 1159 or this Act, whether a proposed, or an
expansion of an existing venture, shall comply with the nationality
requirements and be entitled to the incentives provided for a pioneer
registered enterprise under its law of registration and shall, if
not otherwise exempt, be exempt from the application of Presidential
Decree 1395: Provided, however, That less developed area registered
enterprises engaged in non-pioneer activities shall not be exempt from
the payment of sales taxes.
Sec. 6. Financial Assistance. — All government
owned or controlled financing institutions are hereby enjoined to
liberalize their collateral requirements, rediscounting policies, and
other lending policies and requirements in favor of less developed area
registered enterprises which are either sole proprietorships of
Filipino citizens, or partnerships at least sixty per cent (60%) of the
capital of which is owned by citizens of the Philippines, or
corporations or cooperatives, of which at least sixty per cent (60%) of
the capital stock outstanding and entitled to vote is owned by citizens
of the Philippines. In order to effect a meaningful differential
financing cost advantage to the setting up of industrial and
agricultural enterprises in less developed areas in relation to other
areas in the country, and subject to such guidelines as the Central
Bank may formulate, loans to less developed area registered enterprises
shall be exempted from the provisions of Sec. 78 of the General
Banking Act with respect to collateral requirements.
Other government agencies concerned are hereby directed to render such
assistance as may be necessary in order to carry out the purposes of
this Act.
Sec. 7. Identification of Less Developed Areas. —
The Ministry of Industry, the Ministry of Human Settlements, and the
National Economic and Development Authority shall jointly draw up the
"Less Developed Areas List" taking into consideration the following
criteria in each area in relation to developed areas: (1) low per
capita gross domestic product; (2) low level of investments; (3) high
rate of unemployment and/or underemployment; and (4) low level of
infrastructure development, including its accessibility to developed
urban centers: Provided, That the total population of the areas so
listed shall not exceed twenty per cent (20%) of the national
population. For this purpose, the above-mentioned agencies shall draw
up the initial "Less Developed Areas List" within six months from the
approval of this Act.
The Ministry of Industry, the Ministry of Human Settlements, and the
National Economic and Development Authority shall jointly classify or
re-classify the "Less Developed Areas List" at least once in every
three years. The Board shall from time to time recommend the delisting
of a less developed area: Provided, That a less developed area
registered enterprise shall continue to enjoy its status as such,
notwithstanding deletion of the area where it is located, from the
"Less Developed Areas List".
Sec. 8. Exemption from Fees. — Less developed area
registered with total assets worth less than one million pesos
(P1,000,000) shall be exempted from the payment of the filing,
processing and all other fees of the Board of Investments as well as of
the Securities and Exchange Commission.
Sec. 9. Rules and Regulations. — The Board is
hereby authorized to promulgate the rules and regulations as may be
necessary to implement the intent and provisions of this Act which
shall take effect thirty (30) days after their publication in two (2)
newspapers of general circulation in the Philippines.
Sec. 10. Penal Provision. — The penal provisions
provided for in Republic Act 5186 shall likewise apply for the
violation of any provision of this Act, or of the rules and regulations
promulgated pursuant thereto.
Sec. 11. Suppletory Effect of Incentives Acts. —
Republic Acts 5186 and 6135 and Presidential Decree 1159, as far as
applicable and not inconsistent with the provisions of this Act, shall
apply to enterprises registered under this Act.
Sec. 12. Repealing Clause. — All acts, decrees,
executive orders, rules and regulations, or parts thereof, which are
inconsistent with any of the provisions of this Act are hereby repealed
or modified accordingly.
Sec. 13. Separability Clause. — If for any reason,
any provision of this Act is declared invalid, the other provisions of
this Act which are not affected thereby shall continue in full force
and effect.
Sec. 14. Effectivity. — This Act shall take effect
upon its approval.
Approval, November 26,
1979.
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