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Regulatory Framework on the Registration of and Tax Incentives Available to Solar Energy Projects in the Philippines

Mark Darryl A Caniban

Philippine law, while encouraging investments in energy production, generally considers renewable energy generation as a nationalised activity. Power transmission, which the law considers as an operation and management of a public utility, is likewise a nationalised activity. These activities limit foreign equity to 40% of the outstanding capital stock of any corporation engaged in energy business. Even with these limitations, several economic incentives are set in place to attract participating foreign investments. But, unlike most legal rights that are automatic and do not require an enabling act, these economic incentives will have go through confirmation and compliance monitoring by various regulatory agencies such as the Department of Energy (DOE), the Board of Investments (BOI) and the Bureau of Internal Revenue (BIR). Ultimately, the financial, technical and legal requirements associated with setting up, generating, transmitting and selling renewable energy to both contestable and captive markets would seem colossal compared to the incentives.

Mark Darryl A Caniban is a graduate of Lyceum of the Philippines University College of Law. He is an associate at Mata-Perez and Francisco Attorneys-at-Law in Makati City where he handles corporate and tax advisory to energy and mining companies, mergers and acquisitions, as well as corporate and tax litigation. He was previously a tax lawyer at KPMG Philippines (RG Manabat & Co). For correspondence: <>.


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