EXECUTIVE ORDER NO. 362 August 20, 1996
SECOND REGULAR FOREIGN INVESTMENT NEGATIVE LIST
WHEREAS, Republic Act (RA) 8179, which amends RA 7042 also known as the Foreign Investments Act (FIA) of 1991, provides that the Regular Foreign Investment Negative List (RFINL) shall consist only of Lists A and B;
WHEREAS, Section 5, Rule VIII of the amended Implementing Rules and Regulations (IRR) of the FIA as amended, provides that each RFINL shall remain in force only for two years;
WHEREAS, the first RFINL which took effect on 24 October 1994 shall expire on 23 October 1996;
WHEREAS, there is a need to formulate a second RFINL to reflect amendments made by RA 8179 and changes to Lists A and B as recommended by concerned government agencies;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines, by virtue of the powers vested in me by the FIA of 1991 as amended, do hereby order:
SECTION 1. Only investment areas/activities listed in "Annex A" hereof, also known as the second Regular...
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Second regular foreign investment negative list
Executive Order No. 362
SUMMARY OF EXECUTIVE ORDER NO. 362
Foreign Ownership Restrictions:
• No Foreign Equity Allowed (Section 1, Annex A):
- Mass media except recording (Article XVI, Section 11 of the Constitution; Presidential Memorandum dated 04 May 1994)
- Practice of licensed professions except as prescribed by law (Article XIV, Section 14 of the Constitution; Section 1 of RA No. 5181)
- Retail trade (Section 1 of RA No. 1180)
- Cooperatives (Chapter III, Article 26 of RA No. 6938)
- Private security agencies (Section 4 of RA No. 5487)
- Small-scale mining (Section 3 of RA No. 7076)
- Utilization of marine resources in archipelagic waters, territorial sea, and exclusive economic zone (Article XII, Section 2 of the Constitution)
- Ownership, operation and management of cockpits (Section 5 of Presidential Decree No. 449)
- Manufacture, repair, stockpiling and/or distribution of nuclear, biological, chemical and radiological weapons (Article II, Section 8 of the Constitution; Various treaties)
• Up to 25% Foreign Equity (Section 1, Annex A):
- Private recruitment, whether for local or overseas employment (Article 27 of Presidential Decree No. 442)
- Contracts for the construction and repair of locally-funded public works, except infrastructure/development projects covered in RA No. 7718 and foreign-funded projects requiring international competitive bidding (Commonwealth Act No. 541; Presidential Decree 1594; Letter of Instruction 630; Section 2a of RA No. 7718)
• Up to 30% Foreign Equity (Section 1, Annex A):
- Advertising (Article XVI, Section 11 of the Constitution)
• Up to 40% Foreign Equity (Section 1, Annex A):
- Exploration, development and utilization of natural resources (Article XII, Section 2 of the Constitution)
- Ownership of private lands (Article XII, Section 7 of the Constitution; Chapter 5, Section 22 of Commonwealth Act No. 141)
- Operation and management of public utilities (Article XII, Section 11 of the Constitution; Section 16 of Commonwealth Act No. 146)
- Ownership/establishment and administration of educational institutions (Article XIV, Section 2 of the Constitution)
- Engaging in the rice and corn industry (Presidential Decree No. 194)
- Financing companies regulated by the Securities and Exchange Commission (SEC) (Section 6 of RA No. 5980)
- Contracts for the supply of materials, goods and commodities to government-owned or controlled corporation, company, agency or municipal corporation (Section 1 of RA No. 5183)
- Contracts for the construction of defense-related structures (e.g., land, air, sea and coastal defenses, arsenals, barracks, depots, hangars, landing fields, quarters and hospitals) (Commonwealth Act No. 541)
- Project proponent and facility operator of a BOT project requiring a public utilities franchise (Article XII, Section 11 of the Constitution; Section 2a of RA No. 7718)
- Private domestic construction contracts (Republic Act 4566; Article XIV, Section 14 of the Constitution)
• Up to 40% Foreign Equity for Security, Defense, Risk to Health and Morals, and Protection of Small-and Medium-Scale Enterprises (Section 1, Annex A):
- Manufacture, repair, storage, and/or distribution of firearms, gunpowder, dynamite, blasting supplies, explosives ingredients, and telescopic sights requiring Philippine National Police (PNP) clearance (RA No. 7042 as amended by RA No. 8179)
- Manufacture, repair, storage and/or distribution of products requiring Department of National Defense (DND) clearance, such as guns and ammunition for warfare, military ordnance, gunnery systems, guided missiles, tactical aircraft, space vehicles, combat vessels, weapons repair equipment, military communications equipment, night vision equipment, stimulated coherent radiation devices, and armament training devices (RA No. 7042 as amended by RA No. 8179)
- Manufacture and distribution of dangerous drugs (RA No. 7042 as amended by RA No. 8179)
Other Provisions:
• Amendments to List A may be made at any time to reflect changes in specific laws, while amendments to List B shall not be made more often than once every two years (Section 2)
• This Executive Order revokes or modifies all orders, issuances, rules and regulations inconsistent with it (Section 3)
• This Executive Order takes effect immediately after the end of the effectivity of the first Regular Foreign Investment Negative List on 24 October 1996 (Section 4)
Foreign Ownership Restrictions:
• No Foreign Equity Allowed (Section 1, Annex A):
- Mass media except recording (Article XVI, Section 11 of the Constitution; Presidential Memorandum dated 04 May 1994)
- Practice of licensed professions except as prescribed by law (Article XIV, Section 14 of the Constitution; Section 1 of RA No. 5181)
- Retail trade (Section 1 of RA No. 1180)
- Cooperatives (Chapter III, Article 26 of RA No. 6938)
- Private security agencies (Section 4 of RA No. 5487)
- Small-scale mining (Section 3 of RA No. 7076)
- Utilization of marine resources in archipelagic waters, territorial sea, and exclusive economic zone (Article XII, Section 2 of the Constitution)
- Ownership, operation and management of cockpits (Section 5 of Presidential Decree No. 449)
- Manufacture, repair, stockpiling and/or distribution of nuclear, biological, chemical and radiological weapons (Article II, Section 8 of the Constitution; Various treaties)
• Up to 25% Foreign Equity (Section 1, Annex A):
- Private recruitment, whether for local or overseas employment (Article 27 of Presidential Decree No. 442)
- Contracts for the construction and repair of locally-funded public works, except infrastructure/development projects covered in RA No. 7718 and foreign-funded projects requiring international competitive bidding (Commonwealth Act No. 541; Presidential Decree 1594; Letter of Instruction 630; Section 2a of RA No. 7718)
• Up to 30% Foreign Equity (Section 1, Annex A):
- Advertising (Article XVI, Section 11 of the Constitution)
• Up to 40% Foreign Equity (Section 1, Annex A):
- Exploration, development and utilization of natural resources (Article XII, Section 2 of the Constitution)
- Ownership of private lands (Article XII, Section 7 of the Constitution; Chapter 5, Section 22 of Commonwealth Act No. 141)
- Operation and management of public utilities (Article XII, Section 11 of the Constitution; Section 16 of Commonwealth Act No. 146)
- Ownership/establishment and administration of educational institutions (Article XIV, Section 2 of the Constitution)
- Engaging in the rice and corn industry (Presidential Decree No. 194)
- Financing companies regulated by the Securities and Exchange Commission (SEC) (Section 6 of RA No. 5980)
- Contracts for the supply of materials, goods and commodities to government-owned or controlled corporation, company, agency or municipal corporation (Section 1 of RA No. 5183)
- Contracts for the construction of defense-related structures (e.g., land, air, sea and coastal defenses, arsenals, barracks, depots, hangars, landing fields, quarters and hospitals) (Commonwealth Act No. 541)
- Project proponent and facility operator of a BOT project requiring a public utilities franchise (Article XII, Section 11 of the Constitution; Section 2a of RA No. 7718)
- Private domestic construction contracts (Republic Act 4566; Article XIV, Section 14 of the Constitution)
• Up to 40% Foreign Equity for Security, Defense, Risk to Health and Morals, and Protection of Small-and Medium-Scale Enterprises (Section 1, Annex A):
- Manufacture, repair, storage, and/or distribution of firearms, gunpowder, dynamite, blasting supplies, explosives ingredients, and telescopic sights requiring Philippine National Police (PNP) clearance (RA No. 7042 as amended by RA No. 8179)
- Manufacture, repair, storage and/or distribution of products requiring Department of National Defense (DND) clearance, such as guns and ammunition for warfare, military ordnance, gunnery systems, guided missiles, tactical aircraft, space vehicles, combat vessels, weapons repair equipment, military communications equipment, night vision equipment, stimulated coherent radiation devices, and armament training devices (RA No. 7042 as amended by RA No. 8179)
- Manufacture and distribution of dangerous drugs (RA No. 7042 as amended by RA No. 8179)
Other Provisions:
• Amendments to List A may be made at any time to reflect changes in specific laws, while amendments to List B shall not be made more often than once every two years (Section 2)
• This Executive Order revokes or modifies all orders, issuances, rules and regulations inconsistent with it (Section 3)
• This Executive Order takes effect immediately after the end of the effectivity of the first Regular Foreign Investment Negative List on 24 October 1996 (Section 4)