Rationalizing the Duty Free Stores/Outlets and Their Operations in the Philippines and For Other Purposes

EXECUTIVE ORDER NO. 140 November 30, 1993

RATIONALIZING THE DUTY FREE STORES/OUTLETS AND THEIR OPERATIONS IN THE PHILIPPINES AND FOR OTHER PURPOSES

WHEREAS, duty free stores/outlets have proliferated in areas beyond international ports of entry and expanded product lines that broaden entry of duty free goods into the domestic economy with adverse effects on local enterprises in manufacturing and retailing;

WHEREAS, Executive Order No. 68 imposes, effective April 1, 1993, an entrance fee of P50.00 on entry of all non-passengers to duty free shops operated by the Duty Free Philippines, to mobilize revenue for budgetary requirements and dampen access of non-passengers in order to mitigate adverse impact on local enterprises of large volume of duty free goods entered through duty free shops;

WHEREAS, there is a further need to conduct a comprehensive study on the operational aspects of all duty free stores/outlets, including those in the Subic Special Economic Zone and the former Clark Air Base, in order to evolve a more wholistic policy approach thereon, but in the meantime, adopt...

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RATIONALIZING THE DUTY FREE STORES/OUTLETS AND THEIR OPERATIONS IN THE PHILIPPINES

Moratorium on Establishment and Expansion of Duty Free Stores/Outlets
- A moratorium is imposed on the establishment of new duty free stores/outlets, except those at international ports of entry (e.g., Davao International Airport). (Sec. 1)
- The moratorium also applies to duty free stores/outlets in the Subic Special Economic Zone and the former Clark Air Base. (Sec. 1)
- Proposals to expand operational aspects of existing duty free stores/outlets (e.g., opening to AFP personnel or retirees, increasing shopping limits or time) are also covered by the moratorium. (Sec. 1)

Phasing Out of Certain Duty Free Stores/Outlets
- Duty free stores/outlets not located at international ports of entry, such as the Paskuhan Village at San Fernando, Pampanga and the one at the PICC, shall be phased out. (Sec. 2)

Advertising Restrictions for Duty Free Philippines
- The Duty Free Philippines shall limit advertising for duty free shopping to international ports of entry, duty free stores/outlets/order centers, international airlines and travel agencies, and publications devoted to international travel and tourism, to avoid undue competition with domestic establishments and industries. (Sec. 3)

Remittance to National Government
- The Duty Free Philippines shall remit to the National Government an amount equivalent to 1.5 percent of its net sales. (Sec. 4)

Comprehensive Study on Operational Aspects of Duty Free Stores
- The Department of Finance and the Department of Tourism, in coordination with other concerned government institutions and industry chambers/associations, shall conduct a comprehensive study on the operational aspects (such as kinds of goods to be sold, shopping time and limits, access to the public, acceptable currency, monitoring/reporting requirements, among others) of all duty free stores, including those in the Subic Special Economic Zone and the former Clark Air Base. (Sec. 5)
- The study shall be submitted to the Office of the President within one month after the effectivity of this Executive Order. (Sec. 5)

Revocation of Executive Order No. 68
- Executive Order No. 68, which imposed a P50.00 entrance fee on non-passengers to duty free shops operated by the Duty Free Philippines, is hereby revoked. (Sec. 6)

Effectivity
- This Executive Order shall take effect immediately. (Sec. 7)