JFC Proposed Amendments to the IRR of the BOT Law
July 21, 2011 at 07:39
The primary consideration in crafting the said amendments is that while the Constitution restricts foreign equity participation in public utilities to forty percent (40%), the restriction applies only to the operation of a public utility but not to any other component of the project, including ownership over its facilities. Otherwise stated, the Constitution does not impose any franchise requirement – and therefore no nationality restriction – in the ownership of facilities used to serve the public. The dichotomy between operation and ownership of public utilities has likewise been well settled in Philippine jurisprudence, and has been the basis for majority foreign ownership of infrastructure facilities such as the EDSA MRT III.
Indeed, foreign investment has a critical role to play in financing, in whole or in part, priority infrastructure and development projects that are vital to the country’s economic growth and future, especially where government and local private funding is insufficient to meet capital needs. It is in understanding this role, and working in a collaborative spirit, that we can spur foreign investor interest in the country and fully realize the economic growth potential that the PPP policy holds.
To download the entire proposal as submitted by the JFC to NEDA Director General Cayetano W. Paderanga, Jr. in a letter dated June 1, 2011, click here.
