Saturday, 1 May 2010

Aurora Special Economic Zone Act lapses into law

Gerard S. dela Pena
BusinessWorld
http://www.bworldonline.com/main/content.php?id=10217

President Gloria Macapagal Arroyo has allowed to lapse into law a measure aimed at increasing the competitiveness of industries in Aurora province and harnessing its natural resources.

Mrs. Arroyo allowed Republic Act (RA) No. 10083 -- which amends RA 9490 or the Aurora Special Economic Zone Act of 2007 -- to become law on April 22 by virtue of not affixing her signature on it. The measure is the consolidated version of Senate Bill No. 3408 and House Bill No. 6213.

Under the Constitution, the president may sign or veto a measure approved by both houses of the Congress 30 days upon receipt by the Palace. If the president does not act on it, the measure lapses into law.

The new law renames the Aurora Special Economic Zone into Aurora Pacific Economic Zone (APEZA).

It also provides for the expansion of the actual size of the economic zone, which is located in municipality of Casiguran in Aurora, to 13,852 hectares from the previous 480 hectares.

Another salient feature of the new law is the provision for the creation of a corporate body called the Aurora Development Corp. (ADC), which will act as the operating and implementing arm of the APEZA in managing the economic zone. The president is also given the power to nominate the president and chief executive officer of the ADC.

The 5% tax slapped on gross income of the exo zone locators was also restructured so that 2% will go to the national government’s coffers, 2% will be remitted to the treasurer’s office of the municipality, and 1% will go to the APEZA. Previously, locators were required to remit 3% of their gross income to the national government.

Economic zones are created to entice foreign investors to set up shop in the country by giving them perks such as exemption from certain taxes.

The latest data from the Philippine Economic Zone Authority showed that exports from economic zones reached $9.46 billion in the first quarter, almost 49% higher than year ago levels, due to the improvement in demand for Philippine-made products.

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