[ OP MEMORANDUM ORDER NO. 51, JANUARY 22, 2002, January 21, 2002 ]
PROVIDING AMENDMENTS TO MO NO. 346 S. OF 1996 "AMENDING THE GUIDELINES ON THE CAR DEVELOPMENT PROGRAM (CDP), THE COMMERCIAL VEHICLE DEVELOPMENT PROGRAM (CVDP), AND THE MOTORCYCLE DEVELOPMENT PROGRAM (MDP)" AS AMENDED BY M.O. NO. 473 S. OF 1998
WHEREAS, the Philippines, as member of the World Trade Organization (WTO), has committed to eliminate all laws, provisions, rules, regulations and guidelines that may run counter to the different Agreements under the auspices of the WTO to which the Philippines is a signatory, such as the Agreement of Trade-Related Investment Measures (TRIMS);
WHEREAS, the Agreement on TRIMS mandates the elimination of laws, provisions, rules, regulations and guidelines that provide for local content (LC) and net foreign exchange earnings (NFEE) requirements as they are considered contrary to provisions thereof,
WHEREAS, the Philippines was granted formal approval by the Council for Trade in Goods (CTG) for an extension of the applicability of the subject TRIMS for an additional period of 3 years from and after 1 January 2000, the original expiry date of the transition period for the elimination of TRIMS, subject to a required phase-out schedule;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Philippines, by virtue of the powers vested in me by law, do hereby declare the following amendments to the Motor Vehicle Development Programs:
SECTION 1. Section 7.1 of Chapter I (CDP), Section 16.1 & 16.4 of Chapter II (CVDP) and Section 24.1 of Chapter III (MDP) are hereby amended to read:
"Participants of the CDP, CVDP and MDP shall comply with the following local content requirements:
Period
CDP
CVDP
MDP
1 & 11
1 & 11
111
IVA
IVB
IVC
IVD-V
Cat. A
Cat. B
Jan. 2, 2002
until June 30, 2002
35%
39.37%
19.16%
18.76%
19.46%
11.839%
12.049%
39.375%
30.625%
July 1, 2002
Until Dec. 31 2002
30%
33.750%
16.425%
16.08%
16.68%
10.148%
10.328%
33.750%
26.250%
As of July 1, 2003
0
0
0
0
0
0
0
0
0
SECTION 2. Sections 10.2, 10.3 and 10.4 of Chapter I (CDP), Section 19.1 Chapter II (CVDP) and Section 26.1 of Chapter III (MDP) are hereby amended to read:
"Participants of the CDP, CVDP, MDP will still be required to earn foreign exchange credits through the export of automotive products to be able to import CKDs. The net foreign earnings shall be recorded in ledger without bonus and the foreign exchange ratio (as a percentage of CKD import value) shall be as follows:
Date
CDP
CVDP
MDP
Cat. 1
Cat. 11
Cat. 111
Cat. I & 11
Cat. 111 & IV
Cat. A & B
Jan. 1, 2002 until Dec. 31, 2002
15%
55%
75%
15%
5%
15%
Jan. 1, 2003 until June 30, 2003
15%
55%
75%
15%
5%
15%
As of July 1, 2003
0
0
0
0
0
0
SECTION 3. Repealing Clause. - All other executive orders, administrative orders, memorandum orders, and rules and regulations, or parts thereof inconsistent with the provisions of this Memorandum Order are hereby repealed or modified accordingly.
SECTION 4. Effectivity. - This Executive Order shall take effect immediately.
Adopted: 22 January 2002
WHEREAS, the Agreement on TRIMS mandates the elimination of laws, provisions, rules, regulations and guidelines that provide for local content (LC) and net foreign exchange earnings (NFEE) requirements as they are considered contrary to provisions thereof,
WHEREAS, the Philippines was granted formal approval by the Council for Trade in Goods (CTG) for an extension of the applicability of the subject TRIMS for an additional period of 3 years from and after 1 January 2000, the original expiry date of the transition period for the elimination of TRIMS, subject to a required phase-out schedule;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Philippines, by virtue of the powers vested in me by law, do hereby declare the following amendments to the Motor Vehicle Development Programs:
SECTION 1. Section 7.1 of Chapter I (CDP), Section 16.1 & 16.4 of Chapter II (CVDP) and Section 24.1 of Chapter III (MDP) are hereby amended to read:
"Participants of the CDP, CVDP and MDP shall comply with the following local content requirements:
Period
CDP
CVDP
MDP
1 & 11
1 & 11
111
IVA
IVB
IVC
IVD-V
Cat. A
Cat. B
Jan. 2, 2002
until June 30, 2002
35%
39.37%
19.16%
18.76%
19.46%
11.839%
12.049%
39.375%
30.625%
July 1, 2002
Until Dec. 31 2002
30%
33.750%
16.425%
16.08%
16.68%
10.148%
10.328%
33.750%
26.250%
As of July 1, 2003
0
0
0
0
0
0
0
0
0
SECTION 2. Sections 10.2, 10.3 and 10.4 of Chapter I (CDP), Section 19.1 Chapter II (CVDP) and Section 26.1 of Chapter III (MDP) are hereby amended to read:
"Participants of the CDP, CVDP, MDP will still be required to earn foreign exchange credits through the export of automotive products to be able to import CKDs. The net foreign earnings shall be recorded in ledger without bonus and the foreign exchange ratio (as a percentage of CKD import value) shall be as follows:
Date
CDP
CVDP
MDP
Cat. 1
Cat. 11
Cat. 111
Cat. I & 11
Cat. 111 & IV
Cat. A & B
Jan. 1, 2002 until Dec. 31, 2002
15%
55%
75%
15%
5%
15%
Jan. 1, 2003 until June 30, 2003
15%
55%
75%
15%
5%
15%
As of July 1, 2003
0
0
0
0
0
0
SECTION 3. Repealing Clause. - All other executive orders, administrative orders, memorandum orders, and rules and regulations, or parts thereof inconsistent with the provisions of this Memorandum Order are hereby repealed or modified accordingly.
SECTION 4. Effectivity. - This Executive Order shall take effect immediately.
Adopted: 22 January 2002
(SGD.) ALBERTO G. ROMULO
Executive Secretary
Executive Secretary