PEZA endorses 1,325 IT-BPMs transfer to BOI

The Philippine Economic Zone Authority (PEZA) has endorsed the registration transfer of 452 registered business enterprises (RBEs) involving 1,325 IT business process management (IT-BPM) projects to the Board of Investments (BOI).

The transfer of these RBEs to BOI from PEZA are meant to ensure they can continue their work-from-home (WFH) work arrangement and still enjoy the full tax and fiscal incentives granted under its PEZA registration. The agency has registered a total of 1,088 ITBPMs before the transfer to BOI took effect.

But PEZA-registered ITBPMs can no longer operate WFH outside of the approved ecozone location under the CREATE Law. Thus, the transfer to the BOI will ensure them of WFH privilege and full availment of the tax incentives.

PEZA OIC Deputy Director General Tereso O. Panga said there was only one incomplete application that still remained pending as of Dec. 29, 2022.

According to Panga, many ITBPMs of PEZA are still waiting for the Department of Justice decision being sought by PEZA that these enterprises would be covered by the 30 percent WFH allowance. PEZA expects to DOJ to issue its decision within the month.

“Many would want to be covered by the 30 percent WFH policy of PEZA,” said Panga.

The PEZA has also requested for a one-month extension of the Dec. 16, 2022 deadline for the filing of application for the transfer to BOI.

“Whatever it takes to keep the competitiveness of our IT locators, we are all for it as our IT locators expect a seamless paper transfer to the BOI,” said Panga. He expressed hope that all ease of doing business measures under the existing PEZA one stop facility will be retained.

“This is the preferred arrangement by our IT locators moving forward,” he said noting that the ultimate solution to the predicament of ITBPMs is the institutionalization of WFH arrangement, including the amendment of Section 309 of the CREATE Law.

IT and Business Process Association of the Philippines (IBPAP) President Jack Madrid said they were aware of registered some RBEs who would rather not undertake the paper transfer of their registration to BOI and stay solely with PEZA as their investment promotion agency (IPA).

In fact, Madrid said that IBPAP has not received requests from members for extension of the application deadline for registration transfer.

IBPAP has been in constant coordination with the PEZA and BOI during the application period and therefore updated on the progress of submissions from the IT-BPM RBEs.

But the association appreciates the initiative of Congressman Joey Salceda asking the Fiscal Incentives Review Board (FIRB) to grant a one-month extension.

No matter how things turn out, Madrid said they will continue to work with government partners towards a resolution that will be for the benefit of the RBEs.

"We truly appreciate how PEZA and BOI have been helping the industry throughout this whole undertaking," he concluded.