The Information Technology and Business Process Association of the Philippines (IBPAP) yesterday said companies should be given a free hand in choosing from which agencies they will secure incentives while still being able to adopt hybrid work.
The group made this statement after a lawmaker said the government should manage the shift of registration of IT-BPM companies from the Philippine Economic Zone Authority (PEZA) to the Board of Investments (BOI) where they would be able to mount hybrid work.
Jack Madrid, president and chief executive officer of IBPAP, in his statement called on the need to have clear and consistent legislation that will ensure minimal disruptions to the business operations of IT-BPM companies, including giving them autonomy on whether to keep their projects with PEZA or to transfer their registration with BOI.
Previously, Trade Secretary Ramon Lopez had said BOI-registered companies are allowed up to 30 percent offsite work without losing incentives. However, Section 309 of the Corporate Recovery and Tax Incentives (CREATE) Law states that a qualified registered project or activity under an IPA administering an economic zone or freeport, in this case PEZA, shall be exclusively conducted or operated within the geographical boundaries of said zone or freeport.
The group therefore calls for the amendment of this provision or possibly the revision of the applicable portions of its implementing rules and regulations.
IBPAP said giving companies partners sufficient leeway as to where they would want to register will help promote the ease of doing business in the country especially with the apparent entry of the new administration.
“Registering with investment promotion agencies such as the BOI and the PEZA is an important, complex decision made by companies based on their business goals, priorities, and investment criteria. Ongoing discussions towards institutionalizing work-from-home (WFH) arrangements does not alter this,” Madrid said.
According to Madrid, while incentives have been made uniform across the different IPAs through CREATE, the policies that govern the administration and supervision of registered enterprises among IPAs are not uniform and transfers of registration from one IPA to another may not be as easy.
“If mass transfer of registration from one IPA to another is mandated, registered business enterprises will be subjected to an arduous task that not everybody may be willing to take for the time being and under the present circumstances. This appears contrary to the ease of doing business principles the government has been trying so hard to establish,” Madrid said.
Charito Plaza, PEZA director-general, said the proposal to let IT-BPM companies transfer from PEZA to BOI is misleading because, under the CREATE Law, all IPAs now have the same incentives.
Plaza supported Madrid’s statement to give companies the freedom to choose which IPA they would register but noted the advantage of the one-stop shop services given by PEZA. Irma Isip
