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PRESIDENTIAL DECREE NO. 1246
PRESIDENTIAL DECREE NO. 1246
- FURTHER AMENDING CERTAIN PROVISIONS OF REPUBLIC ACT NUMBERED
SIXTY-FOUR HUNDRED AND TWENTY-SIX, AS AMENDED BY PRESIDENTIAL DECREE
NUMBERED ONE THOUSAND THIRTY-FIVE
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WHEREAS,
under Republic Act No. 6426, as amended by Presidential Decree No.
1035, certain Philippine banking institutions and branches of foreign
banks are authorized to accept deposits in foreign currency;chanroblesvirtualawlibrary
WHEREAS, under the provisions of Presidential Decree No. 1034
authorizing the establishment of an offshore banking system in the
Philippines, offshore banking units are also authorized to receive
foreign currency deposits in certain cases;chanroblesvirtualawlibrary
WHEREAS, in order to assure the development and speedy growth of the
Foreign Currency Deposit System and the Offshore Banking System in the
Philippines, certain incentives were provided for under the two Systems
such as confidentiality of deposits subject to certain exceptions and
tax exemptions on the interest income of depositors who are
nonresidents and are not engaged in trade or business in the
Philippines;chanroblesvirtualawlibrary
WHEREAS, making absolute the protective cloak of confidentiality over
such foreign currency deposits, exempting such deposits from tax, and
guaranteeing the vested rights of depositors would better encourage the
inflow of foreign currency deposits into the banking institutions
authorized to accept such deposits in the Philippines thereby placing
such institutions more in a position to properly channel the same to
loans and investments in the Philippines, thus directly contributing to
the economic development of the country; chanroblesvirtualawlibrary
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers in me vested by the Constitution, do hereby
decree the following:cralaw:red
Section 1. Section 6 of Republic Act No. 6426, as
amended, is hereby amended to read as follows:cralaw:red
"Sec. 6. Tax Exemptions. — All foreign currency
deposits made under this Act, as amended by Presidential Decree No.
1035, as well as foreign currency deposits authorized under
Presidential Decree No. 1034, including interest and all other income
or earnings of such deposits, are hereby exempted from any and all
taxes whatsoever irrespective of whether or not these deposits are made
by residents or non-residents so long as the deposits are eligible or
allowed under aforementioned laws and, in the case of non-residents,
irrespective of whether or not they are engaged in trade or business in
the Philippines."
Section 2. Section 8 of Republic Act No. 6426, as
amended, is hereby amended to read as follows:cralaw:red
"Sec. 8. Secrecy of Foreign Currency Deposits. — All
foreign currency deposits authorized under this Act, as amended by
Presidential Decree No. 1035, as well as foreign currency deposits
authorized under Presidential Decree No. 1034, are hereby declared as
and considered of an absolutely confidential nature and, except upon
the written permission of the depositors, in no instance shall such
foreign currency deposits be examined, inquired or looked into by any
person, government official, bureau or office whether judicial or
administrative or private: Provided, however, that said foreign
currency deposits shall be exempt from attachment, garnishment, or any
other order or process of any court, legislative body, government
agency or any administrative body whatsoever."
Section 3. The same Act is further amended by adding
the following Section immediately after Section 12 thereof to read as
follows:cralaw:red
"Sec. 12-A. Amendatory Enactments and Regulations. —
In the event a new enactment or regulation is issued decreasing the
rights hereunder granted, such new enactment or regulation shall not
apply to foreign currency deposits already made or existing at the time
of issuance of such new enactment or regulation, but such new enactment
or regulation shall apply only to foreign currency deposits made after
its issuance."
Section 4. This Decree shall take effect upon
approval.
Done in the City of Manila,
this 21st day of November, in the year of Our Lord, nineteen hundred
and seventy-seven.
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