No Extra Favorable Treatment under JPEPA; Japanese Investors Subject to Existing Laws
There will be no extra favorable treatment outside of the existing laws in place that will be extended to Japanese investments in the Philippines under the proposed Japan-Philippines Economic Partnership Agreement (JPEPA), Trade and Industry officer-in-charge Thomas G. Aquino said.
Aquino stressed this to dispel reports that the proposed JPEPA will shut out Filipino investments in their own land as a result of the National Treatment provision that aims to give special treatment to Japanese investors.
Treatment of Japanese investments in the country is among the three issues that have yet to be resolved. The other two are automotive and movement of natural persons.
Aquino said this is explicit on the Chapter on Investment is the Performance Requirement Prohibitions that clarify the Philippine governments existing regulations for Japanese and other foreign investors.
"Japanese nationals who wish to invest in the country are subject to Constitutional restrictions and limitations of the Philippines national laws such that they are prohibited to own land, cannot enter retail trade unless they comply with regulations under Republic Act 8762 or the Retail Trade Liberalization Act," Aquino said.
Japanese investors are also subject to equity restrictions under the Foreign Investments Negative List (FINL) of the Foreign Investments Act, which limits foreign equity investments in areas such as mass media, practice of professions, cooperatives, small-scale mining, utilization of marine resources, and others.
What the National Treatment aims to provide Japanese investors is equal treatment or access in terms of equal protection of the law once the Japanese investor is established in the Philippine Territory.
"Japanese investors will be given equal access to the courts of justice and administrative tribunals and agencies in all degrees of jurisdiction," Aquino said.
Aquino reported that the other highlight of the Chapter on Investments is the provision on Most Favored Nation (MFN) Treatment.
On the MFN principle, Aquino said, Japanese investors will be treated like other foreign investors and vice versa.
The draft texts states that "each party shall accord to investors of the other party and to their investments, treatment no less favorable than it accords, in, in like circumstances, to investors of a non-Party and to their investments, with respect to investment activities."
The Chapter on Investments of the Economic Partnership Agreement (EPA) provides for greater transparency on rules and regulations governing Japanese investments in the Philippines and vice versa.
"EPA aims to install a more transparent investment environment by providing more regularity, predictability and certainty in the economic environment. …