Special InTAX: July 2022 Issue 1 | Volume 2

InTAX is an official publication of R.G. Manabat & Co.'s Tax Group

InTAX is an official publication of R.G. Manabat & Co.'s Tax Group

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On 27 June 2022, the President issued Executive Order (EO) No. 175, an order Promulgating the 12th Regular Foreign Investment Negative List (RFINL). This EO is intended to replace the 11th Regular Foreign Investment Negative List, to reflect changes to List A and List B pursuant to Republic Act (RA) No. 7042 or the Foreign Investment Act of 1991, consistent with the policy to ease restrictions on foreign participation in certain investment areas or activities.

The salient points of the EO are as follows:

Investment areas or activities under List A and B listed in the 11th RFINL under EO No. 65 dated 29 October 2018, are retained.

List A includes 24 areas of investment and extent of foreign ownership, where limitations are mandated by the Philippine Constitution and specific laws. The extent of foreign ownership under this list are categorized as follows:


No foreign equity allowed [e.g., mass media, practice of professions, retail trade enterprises with paid-up capital of less than Php25M (previously USD2.5M)];


Up to 25% foreign equity allowed (e.g., private recruitment for local or overseas employment);


Up to 30% foreign equity allowed (i.e., advertising); and


Up to 40% foreign equity allowed (e.g., procurement of infrastructure projects, ownership of private lands/condominium units, operation of public utilities).

Pursuant to RA No. 11659, which amended Commonwealth Act No. 146 or the Public Service Act, the term “public utility” pertains to public service that operates, manages or controls for public use any of the following: (a) distribution of electricity; (b) transmission of electricity; (c) petroleum and petroleum pipeline transmission systems; (d) water pipeline distribution systems and wastewater pipeline systems, including sewerage pipeline systems; (e) seaports; and (d) public utility vehicles. Thus, the 40% foreign ownership limitation may not be applicable on those public services not classified as "public utilities" under RA No. 11659.

List B includes six areas of investment and extent of foreign ownership, where limitations are for reasons such as national security and defense, the risk to health and morals, and protection of local Small and Medium Enterprises (SMEs). The areas of investment in List B are allowed up to 40% foreign equity ownership.

EO No. 175 shall take effect 15 days after its publication or 13 July 2022 since it was uploaded to/published in the Official Gazette on 28 June 2022.


The Bureau of Internal Revenue (BIR) issued Revenue Memorandum Circular (RMC) No. 82-2022, 30 June 2022, to address the issues and concerns on the service of the electronic Letter of Authority (eLA) to the taxpayer within 30 days from its date of issuance under Revenue Memorandum Order (RAMO) No. 1 -2000.

The salient points of the RMC are as follows:

RAMO No. 1-2000 was already amended by RAMO No. 1-2020 which provides that the mandatory 30-day period of serving the eLA to the taxpayer has already been removed.

While there is no timeline required for the service of the eLA, it is still for the best interest of the government that the eLA be served to the taxpayer immediately upon issuance/assignment thereof considering that the entire audit process must be completed within 180 days for RDO cases and 240 days for LT cases from the date of issuance of the eLA. Otherwise, the non-observance on the aforesaid 180-day or 240-day timeline is considered as gross neglect of duty, which is a grave offense subject to appropriate administrative sanctions pursuant to Revenue Memorandum Order No. 53-2010.

The deletion of the 30-day period to serve the eLA shall in no case be an excuse for the concerned revenue officers to delay its service, nor for a taxpayer to refuse its service or to question its validity in case the same is served beyond the 30-day period.

An eLA which remains unserved upon the effectivity of this RMC or has been served beyond the 30-day period from the date of its issuance shall still be considered valid and enforceable, provided that the 180-day/240-day period to complete the audit process has not yet expired.

(R.G. Manabat & Co: Note that the RMC did not provide the effectivity date of the issuance)

Attached are the full texts of the above issuances.

RMC No. 82-2022

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