Business process outsourcing (BPO) firms and ecozone locators welcomed the expanded work-from-home (WFH) policy, saying the move will help ease rising operating costs and support business continuity amid an energy crunch.

This, after the Fiscal Incentives Review Board (FIRB) approved the expansion of the WFH limit in economic and freeport zones to 90 percent from the previous 50 percent, a move seen to cushion the impact of rising fuel prices on registered business enterprises (RBEs) without disrupting their government incentives.

In FIRB Resolution No. 005-2026 dated April 8, but made public on Friday, April 10, the interagency board granted investment promotion agencies (IPAs) the authority to adopt up to 90-percent temporary WFH arrangements for RBEs with registered projects or activities.

Trade Secretary Cristina Roque, who serves as co-chair of FIRB, said this policy will allow RBEs to maintain their cost competitiveness amid rising expenses that may jeopardize their operations.

“Equally important, [this will] ease the burden of higher fuel prices on their workforce,” she told Manila Bulletin on Saturday, April 11.

Under the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act, RBEs may only implement WFH arrangements for up to 50 percent of their total workforce.

Within this ceiling, RBEs will continue to enjoy incentives provided by IPAs, including an income tax holiday (ITH), enhanced deductions regime, and duty exemptions on importation, among others.

By expanding the limit beyond 50 percent, the government ensures that RBEs would still benefit from their fiscal and non-fiscal incentives, helping them remain resilient even as the ongoing conflict in the Middle East continues to drive up fuel prices.

President Ferdinand “Bongbong” Marcos Jr. issued Executive Order (EO) No. 110 last month, placing the Philippines under a state of national energy emergency due to challenges in the domestic energy supply.

Through this order, Marcos encouraged the private sector to consider measures such as adopting flexible work arrangements to reduce operating costs.

The Philippine Economic Zone Authority (PEZA) said that allowing up to 90 percent of the workforce to work remotely will mitigate the impact of rising costs in transportation, logistics, electricity, and basic goods on both RBEs and their employees.

Roque also described the move as a “fair policy” that promotes business continuity for both ecozone developers and locator companies.

“This is the clamor particularly of the IT-BPM [information technology-business process management] industry in light of the anticipated shortage in fuel and electricity supply in the country given the worsening war conflict in the Middle East,” Roque said.

In a statement sent to Manila Bulletin, the IT and Business Process Association of the Philippines (IBPAP) said expanding the WFH limit provides immediate relief for RBEs, noting that it is a “practical business continuity measure” in response to the current crisis.

“It allows the industry to remain agile, sustain service delivery, and continue meeting the demands of global clients amid a shifting operating environment,” IBPAP said.

The temporary extension of the WFH limit takes effect retroactively from March 24 and will remain in force for one year, unless lifted or extended by the President.

Under FIRB’s resolution, RBEs must first notify and submit the necessary requirements to their respective IPAs before implementing a WFH arrangement.

These include reports on the inventory of technology assets for the WFH scheme, a copy of the surety bond, and monthly updates on equipment brought outside the economic or freeport zone.

Such requirements will still be required for submission after the remote work setup is approved by the IPA, with penalties imposed for noncompliance.

While businesses may opt for up to a 90-percent WFH scheme, IPAs may set a lower threshold of at least 50 percent, depending on specific circumstances and the nature of their operations.

As such, RBEs that fail to comply with their IPA-imposed threshold will be penalized, including the payment of the regular income tax multiplied by the amount by which the threshold is exceeded during a given month.

According to FIRB, RBEs must maintain the prescribed export revenues while retaining their current number of employees, regardless of the authorized ratio or extent of WFH arrangements.