Congress urged to pass bills easing entry of foreign investors

More than 40 local and foreign business groups on Tuesday urged lawmakers to pass three investment reform bills that remain pending in Congress, saying that the country needed to attract foreign capital to help create more jobs during the pandemic.

In a joint statement, the business groups called on Congress to pass the proposed amendments to the following decades-old laws on foreign direct investments (FDI): the Public Service Act of 1936, the Retail Trade Act of 2000, and the Foreign Investment Act of 1991.

“All three measures will relax FDI restrictions and together could result in many billions of new investments in future years, creating more jobs, diversifying the economy, bringing new technology, increasing competition, and providing better services to the benefit of Filipino consumers,” they said.

The groups, which included the American, European and Japanese business chambers, said all these measures were already far advanced in Congress, with the retail trade law in a bicameral conference committee, and the two other measures pending final approval in the Senate.

They also lamented that a debate in the Senate last month showed that some senators wanted to make the Public Service Act even more restrictive, broadening the 60-40 rule to apply to most forms of common carriers, airports, dams, roads and railroads, seaports, and telecommunications. While they did not name the senators, the groups said the lawmakers argued that national security would be at risk if foreigners own public services.

“However, foreign firms have been allowed to own ice plants, power plants, and shipyards for some time and invested heavily in all three major telecommunication firms and the national transmission grid concession,” they said.

“The bill before the Senate contains adequate provisions to protect national security concerns, similar to Australia, Japan, the United States and many others who welcome foreign investment in public services but also apply national security reviews,” they added, calling on the Senate to refrain from applying the 60-40 rule to any public service not classified as a public utility.

The groups that also signed the statement included ACI Philippines; the business chambers of Australia-New Zealand, South Korea, Britain, Canada, France, Spain, Germany and the Netherlands; Association of Certified Public Accountants in Public Practice; Bankers Association of the Philippines; Cebu Business Club; Cebu Leads Foundation Inc.; EU-Asean Business Council; Financial Executives Institute of the Philippines; FinTech Alliance; Foundation for Economic Freedom; Institute of Corporate Directors; Investment House Association of the Philippines; Institute for Solidarity in Asia; Management Association of the Philippines; Makati Business Club; Money Market Association of the Philippines; Nordic Chamber of Commerce; Organization of Socialized and Economic Housing Developers; Philippine Association of Multinational Companies Regional Headquarters; Philippine Life Insurance Association Inc.; Philippines-Swiss Business Council; Philippine Business Coalition for Women Empowerment; Semiconductor and Electronics Industries in the Philippines; Shareholders’ Association of the Philippines; Tax Management Association of the Philippines; US-ASEAN Business Council, and Women’s Business Council Philippines.