April 13, 2010
BIR RULING [DA-(TAR-001) 046-10]
Sec. 43; BIR Ruling No. 005-06; BIR Ruling No. 001-90; BIR Ruling No. DA-432-06
SGV & Co.
6760 Ayala Avenue
Makati City
Attention: Atty. Emmanuel C. Alcantara
Co-Head, Tax Services
Gentlemen :
This refers to your letter dated March 10, 2008 stating that your clients, TeaM Energy Corporation (TEC), TeaM Sual Corporation (TSC) and TeaM Philippines Energy Corporation (TPEC), are domestic corporations duly registered with the Securities and Exchange Commission (SEC); that TEC and TSC are engaged principally in the business of power generation services and the subsequent sale thereof to National Power Corporation (NPC) under a Build, Operate, Transfer (BOT) scheme while TPEC is engaged in the business of power supply; that TEC and TSC directly own power generation plants in Pagbilao, Quezon and Sual, Pangasinan, respectively; that pursuant to a Cost Reimbursement Agreement effective January 2001, between the affiliated power plants as parties, TeaM Energy Group currently allocates the following costs and expenses related to common operational, maintenance and general administrative requirements of the parties using the asset-based method:
Computer Maintenance
Utilities (electricity and water)
Office Supplies
Couriers...
