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Subic Bay Metropolitan Authority (MPD-SBMA)

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14 May 2010

SBMA readies expansion outside secured areas

The Subic Bay Metropolitan Authority (SBMA) is now ready to implement its expansion program, following the release of the Implementing Rules and Regulation (IRR) covering the extension of the boundaries of secured areas of the Subic Bay Freeport.

The IRR was drafted after a series of consultations between the SBMA, Bureau of Customs (BoC) and local government units within the Subic Special Economic and Freeport Zone (SSEFPZ), which may be declared as additional secured areas, or additional areas, as provided under Executive Order No. 675.

These areas include the municipalities of Subic and San Antonio in Zambales; Morong, Dinalupihan and Hermosa in Bataan; and Olongapo City.

Under EO 675, areas within the LGUs may be developed through local government or private sector initiative and become part of the SSEFPZ. These may then avail of appropriate tax, duty-free, and fiscal investment incentives and privileges, upon application and after approval by the SBMA.

SBMA administrator Armand Arreza said that the expansion of the secured areas of SSEFPZ is necessary in order to address the shortage of space for lease to investors.

“This is necessary to push development into communities outside Subic’s ‘secured area’, and also to guarantee the realization of the Subic-Clark economic corridor as a world-class logistics and service hub,” Arreza said.

Under the IRR, areas contiguous to the Subic Bay Freeport may be declared by the SBMA for inclusion as additional secured area after proper consultation with local officials and approval of a resolution by the concerned city or town council.

In addition, any business individual or organization may also apply with the SBMA for inclusion within the SSEFPZ as privately-owned additional secured area or additional area, provided that they submit pertinent documents, clearances and registration certificates.

Meanwhile, lands and buildings in the additional secured areas, whether privately owned or not, may only be leased to SBMA-registered enterprises, subject to the approval or ratification of the SBMA Board of Directors.

Once declared as additional secured areas by SBMA, the areas concerned will be classified either as industrial, tourism, recreational, investment or financial center, or a mix of these developments.

These areas shall be organized, administered, managed and operated directly by the SBMA through an area manager, appointed by the SBMA administrator.

The IRR also provides that privately owned areas shall be managed by a Property Management Board composed of the president of the association of investors, representative of the municipality concerned, two independent private sector representatives chosen by SBMA and LGU, and an official of SBMA.

To prevent smuggling and abuse of duty-free privileges, the SBMA shall establish secured fence-in perimeters for the additional areas within which tax- and duty-free articles and merchandise shall be limited.

According to Arreza, duty-free shop operators shall be allowed within the additional secured areas, provided that they establish their own control system in coordination with the SBMA and the Bureau of Customs.

“In addition, if the LGU concerned agrees, the SBMA Law Enforcement Department shall also provide and establish security forces for the additional secured areas to police and maintain law and order there,” Arreza said.

Arreza also disclosed that as the SBMA seeks to spread development outside the controlled area of the Freeport towards Olongapo, Zambales and Bataan, it will also put in place significant infrastructure investments like roads, schools and bridges that are considered essential in convincing investors to establish operation in these areas. (SBMA Corporate Communications)

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