THE Philippine government has called on foreign retailers to promote Filipino-made products in their shops under the implementing rules and regulations (IRR) of the amended Retail Trade Liberalization Act (RTLA).
The IRR of the amended law was signed on March 9 by Trade Secretary Ramon M. Lopez, Socioeconomic Planning Secretary Karl Kendrick T. Chua, and Securities and Exchange Commission (SEC) Commissioner Emilio B. Aquino.
On Dec. 10 last year, President Rodrigo R. Duterte signed Republic Act No. 11595 that amended Republic Act No. 8762 or the RTLA.
Based on the amended law, the minimum paid-up capital of foreign retailers is reduced to P25 million from $2.5 million, while the minimum investment requirement per store was lowered to P10 million in a bid to entice more foreign investors into the Philippines.
Under Rule 5, Section 6 of the IRR, foreign retailers are encouraged to provide a stock inventory of products manufactured in the Philippines by implementing any of the initiatives such as the designation of a store space as Filipino section; use of locally made packaging materials such as bags, boxes, and containers; use of locally sourced raw materials in production; and other arrangements that will promote Filipino-made products.
Rule 9, Section 2 of the IRR also provided that the Department of Trade and Industry (DTI), National Economic and Development Authority (NEDA), and SEC will review the required minimum paid-up capital every three years from the effectivity of the amended law.
“The DTI, SEC, and NEDA shall each report its recommendation to Congress,” the IRR said.
The IRR also provides that the SEC or the DTI will be responsible for monitoring the registered foreign retailers, while both agencies maintain a record of registered entities that are engaged in retail trade.
Meanwhile, Rule 8, Section 1 of the IRR also said that the new minimum investment per store as required by the amended law will not be applicable to “foreign investors and foreign retailers who are legitimately engaged in retail trade and were not required to comply with this requirement at the time of the effectivity of the act.”
However, registered foreign retailers still need to maintain the minimum paid-up capital as provided under RA 8762.
The IRR provided that violators of the law will face imprisonment of four years to six years and a fine ranging from P1 million to P5 million.
Further, Rule 5, Section 3 of the IRR also requires that every registered foreign retail enterprise will submit to the DTI or SEC the following reports on the maintenance and actual use of the paid-up capital requirement: number and location of stores, investment per store, and status of each store; stock inventory of locally manufactured products; and other reports that may be required.
“It shall be the duty of the foreign retailers to keep their records, inventory, and books of accounts available at all times for inspection by the SEC or DTI, as applicable,” the IRR said.
The amended RTLA is one of the economic liberalization measures of the government seen to help in the country’s economic recovery from the coronavirus disease 2019 (COVID-19) pandemic. The other measures include the signed amendments to the Foreign Investments Act and the pending amendments to the Public Service Act. — Revin Mikhael D. Ochave