NEDA okays new rules on foreign ownership

The National Economic and Development Authority (NEDA) has released the implementing rules and regulations (IRR) of the amended Public Service Act (PSA) that allows full foreign ownership of some Philippine businesses. Upon its effectivity, the amendments to the PSA shall enable the liberalization of key public services by allowing full foreign ownership of businesses in select industries such as airports, railways, expressways, and telecommunications. Prior to the approval of the amendments, foreign ownership in the aforementioned industries was limited to 40 percent. Meanwhile, public service utilities such as electricity transmission and distribution, water and wastewater pipeline distribution system including sewerage, petroleum and petroleum products pipeline transmission systems, seaports, and public utility vehicles remain subject to the 60:40 foreign equity limitation. In a statement Monday, March 20, NEDA Secretary Arsenio M. Balisacan assured that the IRR has undergone extensive review and consultations with the public, legislators, relevant administrative agencies, and other key stakeholders. Balisacan also said all 21 government agencies, including NEDA, approved the IRR of the amended PSA, which will become effective on April 4, 2023. “With the IRR already in place, we see this as a landmark reform that will further improve the country’s position as an ideal investment hub, which will help enhance employment opportunities and allow more Filipinos to benefit from more improved goods and services,” Balisacan said. Accordingly, the amendments also provide safeguard provisions to protect the country against national security concerns that may arise through any proposed merger or acquisition, or any investment in a public service. “The PSA amendments form a critical part of our endeavor to attract foreign investments to the country to boost market competitiveness, foster innovation, and create high-quality jobs,” Balisacan said. Further, relevant administrative agencies may issue guidelines and circulars for the effective implementation of RA No. 11659 and its IRR, provided that these remain consistent with Commonwealth Act No. 146 as amended, as well as with RA No. 11659 and its IRR. “Together with complementary policies and measures… we are confident that the Philippines will be able to attract much-needed capital and technology, sustain its high-growth trajectory, and generate high-quality jobs enabling rapid poverty reduction in the next six years,” Balisacan said.