The government is seen to extend the temporary work from home (WFH) authority for IT-business process management (IT-BPM) economic zone locators as well as the easing of locational restriction in the National Capital Region (NCR).

Trade and Industry Undersecretary Ceferino S. Rodolfo revealed ongoing discussions with the Department of Finance for these measures to continue supporting the ITBPM sector, which are mostly registered with the Philippine Economic Zone Authority (PEZA).

As ecozone locators, IT-BPM companies are not allowed to operate outside of ecozones, and IT Parks and Buildings registered with PEZA. But because of the pandemic, PEZA issued last year a temporary authority allowing these locators WFH arrangement of as much as 90 percent so their workers can continue working even during the pandemic. The temporary authority will lapse on September 12 this year.

Rodolfo explained that the extension is allowed under Section 309 of the Corporate Corporate Recovery and Tax Incentives for Enterprises Act (CREATE Law) as it provides temporary measure during extraordinary circumstances. This is also provided in the Implementing Rules and Regulations of the law.

“During the next board meeting of the Fiscal Incentives Review Board (FIRB) we will be proposing a resolution for the FIRB to approve the WFH arrangement even beyond the September 12 deadline,” said Rodolfo.

He, however, said that DTI could not commit if the 90 percent ceiling for WFH would still be allowed or reduced.

The DTI is also in discussion with the IT-Business Process Association of the Philippines to come up with impact analysis of the WFH arrangement.

Likewise, Rodolfo announced the good news on the possible easing of the moratorium on the registration of IT-BPM projects in the NCR.

In close coordination with the DOF and other government agencies including the National Employment Recovery Strategy Taskforce, Rodolfo said there is a strong possibility that IT-BPM projects to be located in any of the PEZA ecozones in Metro Manila may be allowed to register.

Rodolfo explained that under the CREATE Law, IT-BPM projects intending to locate in the NCR are no longer allowed to register with PEZA for incentive purposes. But during their discussions, the DOF has expressed openness to ease this restriction on condition that the prohibition on the approval of new IT ecozone in NCR will be retained. Based on their initial discussion, new IT-BPM projects maybe allowed to register and locate in the vacated existing IT zones in Metro Manila, but there will be no new IT Zones registrations allowed to be registered in the capital region.

Rodolfo said this easing on the locational restriction may encourage IT-BPM firms to take advantage of leasing vacant office spaces in IT buildings and ecozones in Metro Manila registered with the PEZA. The CREATE law also allows PEZA- registered enterprises to transfer registration with the Board of Investments and still be entitled to the same incentives they are enjoying under PEZA.

It could be recalled that President Duterte issued Administrative Order (AO) 18 in June 12019 banning the establishment of new economic zones in NCR as part of efforts to disperse development into the countryside.