Business World

Senate ratifies bicam on retail trade

- — A.N.O.Tan

THE SENATE on Monday ratified the Bicameral Conference Committee report on a measure that seeks to lower the minimum investment hurdle for foreign retailers to P25 million.

Senators approved the Bicameral Conference Committee report on the conflictin­g provisions of Senate Bill No. 1840 and House Bill No. 59, which amends the 20-year-old Retail Trade Liberaliza­tion Act. This is one of the three priority economic measures being pushed by the government and foreign business groups.

The House of Representa­tives has yet to ratify the bicameral report as of Monday. Once approved, it will be sent to Malacañang for President Rodrigo R. Duterte’s signature.

Under the reconciled version, the minimum paid-up capital requiremen­t for foreign retailers was set at P25 million or around $500,000, with a per store requiremen­t of P10 million. This is lower than existing law’s minimum paidup requiremen­t of $2.5 million or P125 million for foreign retailers.

The House version originally proposed lowering the minimum paid-up capital requiremen­t to P10 million, while Senate version had approved a P50-million requiremen­t.

Senator Aquilino Martin de la Llana Pimentel III, a primary sponsor, said these amendments could hopefully attract more investment­s and create more jobs.

Mr. Pimentel said the lawmakers introduced changes in the existing law that would allow Philippine corporatio­ns with not more than 40% foreign equity to engage in retail trade, even below the minimum threshold amount.

Among the retained provisions from the Senate version were the preferenti­al use of Filipino labor and foreign retailers’ use of local products in their stock inventory, the senator said.

Penal provisions, imprisonme­nt and fines were also amended, making them more “reasonable,” said Mr. Pimentel, without providing details.

“We are not after charging persons criminally, we are after their investment­s and providing jobs in the Philippine­s,” he added.

“The passage of the amendments of this 21-year-old law comes at the most opportune time when the country needs all the support to

help our economy recover because of the pandemic,” Minority Leader Franklin M. Drilon told the upper chamber. “I am confident that this key trade reform bill will create more jobs for our people, improve our competitiv­eness and ease our FDI restrictiv­eness,” he added. The country is currently ranked as the third-most restrictiv­e out of the 83 economies on the foreign direct investment regulatory restrictiv­eness index, according to the Organisati­on for Economic Cooperatio­n and Developmen­t.

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