THE National Economic and Development Authority, along with Congress, will be coming up with an updated Foreign Investments Negative List (FINL) by May.
The foreign investment negative list was last updated in 2015 and maps out investment areas where foreign investment is prohibited or restricted to a minority stake.
According to Rosemarie G. Edillon, Undersecretary for Policy and Planning, NEDA will also be coming up with recommendations along with the list.
“For FINL, we’ll come up with the updated list and recommendation by April-May,” said Ms. Edillon in a text message to BusinessWorld.
Although NEDA is not tasked to come up with the list per se, it has been tasked to compile all the laws that concern foreign investments. As for the restrictions on the list, it is Congress that is in charge of adding and subtracting from the list.
However, Ms. Edillon said besides checking and compiling the law, NEDA will be working together with Congress by giving recommendations.
“Going forward, we will be working with the Congress already about those laws that in our view are no longer relevant and just makes the list very, very long and turns off investors,” said Ms. Edillon in a phone interview.
She was referring to the government’s plan to ease foreign restrictions on telecommunications. She also mentioned that NEDA will be making recommendations to ease foreign restrictions on telecommunications but did not provide further details.
The list of industries closed to foreign investment has been mostly unchanged from the previous reviews.
The areas where foreign ownership is completely prohibited by the Constitution or laws are mass media; the practice of all licensed professions; retail; cooperatives; private security agencies; small-scale mining; utilization of marine resources; ownership, operation and management of cockpits; and manufacture, repair, stockpiling and/or distribution of nuclear weapons.
Areas where foreigners can own stakes of up to 25% are: private recruitment for local or overseas employment and construction and repair of locally-funded works like infrastructure and foreign-assisted projects.
The list of areas where foreigners can own up to 30% are: advertising; exploration, development and utilization of natural resources; private lands; public utilities; education; rice and corn administration; financing and investment companies; supplies to state-owned corporations and agencies; defense-related structures; public utility franchises; and private domestic and overseas construction contracts.
The list of industries allowing up to 40% foreign ownership include security; defense; those industries that pose a risk to health and morals, such as gambling, bath houses and massage clinics; and small-scale and medium-scale enterprises of a certain size.
According to Ms. Edillon, there is no way of easing restrictions other than action by Congress.
“We really need to go through Congress. it’s a matter of law. (Some prohibitions have) to be repealed, also by Congress. It has to be an act of Congress,” she said.
10 December 2016
By Danica M. Uy
