MALACAÑAN PALACE
MANILABY THE PRESIDENT OF THE PHILIPPINES
EXECUTIVE ORDER No. 182
PROVIDING FOR A COMPREHENSIVE AUTOMOTIVE RESURGENCE STRATEGY PROGRAM
WHEREAS, Articles II and XII of the 1987 Constitution of the Philippines recognize the indispensable role of the private sector in encouraging private enterprise, providing incentives to needed investments, and promoting industrialization and full employment;
WHEREAS, Articles 2 and 7 of Executive Order (EO) No. 226 (s. 1987) or the "Omnibus Investments Code of 1987," as amended, declare that the State shall encourage private Filipino and foreign investments in industry which shall provide significant employment opportunities, provide a foundation for the future development of the economy, and meet the tests of international competitiveness and empower the Board of Investments (BOI) to formulate and implement rationalization programs for certain industries to address impediments to economic growth, and formulate guidelines for progressive manufacturing programs;
WHEREAS, EO Nos. 156 (s. 2002) and 877-A (s. 2010) provide for a comprehensive industrial policy and directions for the Motor Vehicle Development Program to accelerate the sound development of the...
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Executive Orders
Providing For A Comprehensive Automotive Resurgence Strategy Program
Executive Order No. 182
Summary of Executive Order No. 182
Comprehensive Automotive Resurgence Strategy (CARS) Program
- Adopted to attract new investments, stimulate demand, and implement regulations to revitalize the Philippine automotive industry and develop the country as a regional manufacturing hub. (Section 1)
- Provides time-bound and performance-based fiscal support to attract strategic investments in manufacturing motor vehicles and parts. (Section 1)
Coverage (Section 2)
- Limited to the manufacture of three (3) models of four-wheeled motor vehicles.
- Covers: (1) Production of enrolled models, (2) Manufacture of body shell assembly and large plastic assemblies, (3) Manufacture of common parts and strategic parts not currently produced in the country, (4) Shared testing facility for vehicles and/or parts.
Definitions (Section 3)
- Defines terms such as "Body Shell Assembly", "Common Parts", "Full Model Change", "Large Plastic Parts", "Logistics Efficiency Index", "Model", "Model Life", "Nameplate", "Parts", "Planned total production volume", "Segment Weighted Average Price", "Standard Production Support", and "Strategic Parts".
Functions of the Board of Investments (BOI) (Section 4)
- Act upon recommendations of the Inter-Agency Committee on Automotive Industry Development.
- Oversee implementation of the CARS Program.
- Submit annual report on program performance to the Office of the President.
- Coordinate automotive industry development efforts.
- Perform other necessary acts.
Inter-Agency Committee on Automotive Industry Development (Sections 5 and 6)
- Created to administer and implement the CARS Program.
- Chaired by the Department of Trade and Industry-BOI representative.
- Members from various government agencies.
- Functions include: (1) Evaluate applications for model enrollment and participant registration, (2) Recommend issuance of certificates of registration, (3) Evaluate eligibility for fiscal support, (4) Monitor performance and audit compliance, (5) Prepare annual report, (6) Recommend withdrawal/forfeiture of support, (7) Undertake studies and research, (8) Perform other necessary functions.
Criteria for Model Enrollment (Section 7)
- Based on factors such as track record, new investments, planned volume (minimum 200,000 vehicles over model life up to 6 years), economic impact, competitive environment, and compliance with fuel efficiency and emission standards.
Eligibility and Qualifications of Participants (Section 8)
- Minimum qualifications for car makers, parts makers, and shared testing facility proponents are specified.
Application and Selection Process (Section 9)
- BOI to establish application and selection process for model enrollment and participant qualification.
- Application period for one model per participating car maker, with possibility of additional models if slots remain.
- Approved participants to be issued Certificate of Registration and post performance bond.
Fiscal Support (Section 10)
- Two types of fiscal support: (1) Fixed Investment Support (FIS) and (2) Production Volume Incentive (PVI).
- Criteria for eligibility for FIS and PVI are specified.
- Computed based on Segment Weighted Average Price, Standard Production Support, and Logistics Efficiency Index.
Automotive Development Fund (Sections 11 and 12)
- Department of Budget and Management to propose inclusion of Automotive Development Fund in annual General Appropriations Act.
- Total fiscal support not to exceed ₱27 billion, with each enrolled model qualified for up to ₱9 billion.
- 40% for FIS and 60% for PVI.
- Annual estimated expenditure to be indicated in National Expenditure Program.
Tax Payment Certificate (Section 13)
- Fiscal support to be evidenced by non-transferable Tax Payment Certificate.
- To be used to defray tax and duty obligations to the National Government.
No Double Availment of Incentives (Section 14)
- Registered participants not allowed to register activity under any other program granting incentives.
Monitoring and Compliance (Section 15)
- Production volume, parts importation volume, deliverables, and commitments to be audited and monitored.
- Failure to meet investment and delivery timelines may result in cancellation of registration, forfeiture of support, and expulsion from the CARS Program.
- Non-compliance with provisions, rules, and terms may lead to penalties.
Implementing Rules and Regulations (Section 16)
- BOI, in coordination with other agencies, to promulgate rules and regulations to implement the Executive Order.
Review of Existing Programs (Section 17)
- Inter-Agency Committee to review existing Motor Vehicle Development Program and other incentive schemes in light of CARS Program implementation and economic developments.
Repealing Clause (Section 18)
- Inconsistent executive orders, rules, regulations, and issuances are revoked, amended, or modified.
Separability Clause (Section 19)
- If any provision is declared invalid or unconstitutional, other provisions remain valid and subsisting.
Effectivity (Section 20)
- Executive Order takes effect immediately upon publication in a newspaper of general circulation.
Comprehensive Automotive Resurgence Strategy (CARS) Program
- Adopted to attract new investments, stimulate demand, and implement regulations to revitalize the Philippine automotive industry and develop the country as a regional manufacturing hub. (Section 1)
- Provides time-bound and performance-based fiscal support to attract strategic investments in manufacturing motor vehicles and parts. (Section 1)
Coverage (Section 2)
- Limited to the manufacture of three (3) models of four-wheeled motor vehicles.
- Covers: (1) Production of enrolled models, (2) Manufacture of body shell assembly and large plastic assemblies, (3) Manufacture of common parts and strategic parts not currently produced in the country, (4) Shared testing facility for vehicles and/or parts.
Definitions (Section 3)
- Defines terms such as "Body Shell Assembly", "Common Parts", "Full Model Change", "Large Plastic Parts", "Logistics Efficiency Index", "Model", "Model Life", "Nameplate", "Parts", "Planned total production volume", "Segment Weighted Average Price", "Standard Production Support", and "Strategic Parts".
Functions of the Board of Investments (BOI) (Section 4)
- Act upon recommendations of the Inter-Agency Committee on Automotive Industry Development.
- Oversee implementation of the CARS Program.
- Submit annual report on program performance to the Office of the President.
- Coordinate automotive industry development efforts.
- Perform other necessary acts.
Inter-Agency Committee on Automotive Industry Development (Sections 5 and 6)
- Created to administer and implement the CARS Program.
- Chaired by the Department of Trade and Industry-BOI representative.
- Members from various government agencies.
- Functions include: (1) Evaluate applications for model enrollment and participant registration, (2) Recommend issuance of certificates of registration, (3) Evaluate eligibility for fiscal support, (4) Monitor performance and audit compliance, (5) Prepare annual report, (6) Recommend withdrawal/forfeiture of support, (7) Undertake studies and research, (8) Perform other necessary functions.
Criteria for Model Enrollment (Section 7)
- Based on factors such as track record, new investments, planned volume (minimum 200,000 vehicles over model life up to 6 years), economic impact, competitive environment, and compliance with fuel efficiency and emission standards.
Eligibility and Qualifications of Participants (Section 8)
- Minimum qualifications for car makers, parts makers, and shared testing facility proponents are specified.
Application and Selection Process (Section 9)
- BOI to establish application and selection process for model enrollment and participant qualification.
- Application period for one model per participating car maker, with possibility of additional models if slots remain.
- Approved participants to be issued Certificate of Registration and post performance bond.
Fiscal Support (Section 10)
- Two types of fiscal support: (1) Fixed Investment Support (FIS) and (2) Production Volume Incentive (PVI).
- Criteria for eligibility for FIS and PVI are specified.
- Computed based on Segment Weighted Average Price, Standard Production Support, and Logistics Efficiency Index.
Automotive Development Fund (Sections 11 and 12)
- Department of Budget and Management to propose inclusion of Automotive Development Fund in annual General Appropriations Act.
- Total fiscal support not to exceed ₱27 billion, with each enrolled model qualified for up to ₱9 billion.
- 40% for FIS and 60% for PVI.
- Annual estimated expenditure to be indicated in National Expenditure Program.
Tax Payment Certificate (Section 13)
- Fiscal support to be evidenced by non-transferable Tax Payment Certificate.
- To be used to defray tax and duty obligations to the National Government.
No Double Availment of Incentives (Section 14)
- Registered participants not allowed to register activity under any other program granting incentives.
Monitoring and Compliance (Section 15)
- Production volume, parts importation volume, deliverables, and commitments to be audited and monitored.
- Failure to meet investment and delivery timelines may result in cancellation of registration, forfeiture of support, and expulsion from the CARS Program.
- Non-compliance with provisions, rules, and terms may lead to penalties.
Implementing Rules and Regulations (Section 16)
- BOI, in coordination with other agencies, to promulgate rules and regulations to implement the Executive Order.
Review of Existing Programs (Section 17)
- Inter-Agency Committee to review existing Motor Vehicle Development Program and other incentive schemes in light of CARS Program implementation and economic developments.
Repealing Clause (Section 18)
- Inconsistent executive orders, rules, regulations, and issuances are revoked, amended, or modified.
Separability Clause (Section 19)
- If any provision is declared invalid or unconstitutional, other provisions remain valid and subsisting.
Effectivity (Section 20)
- Executive Order takes effect immediately upon publication in a newspaper of general circulation.