LATH311 Midterm PDF

Legal Aspect in Tourism and Hospitality TOURISM ACT OF 2009 Section 2: OBJECTIVES OF THE TOURISM ACT OF 2009 Approved by former President Gloria (a) Develop a national tourism action plan an...

Legal Aspect in Tourism and Hospitality TOURISM ACT OF 2009 Section 2: OBJECTIVES OF THE TOURISM ACT OF 2009 Approved by former President Gloria (a) Develop a national tourism action plan and Macapagal Arroyo on May 12, 2009; work for its adoption and implementation by Published in the Official Gazette on July national and local governments; 13, 2009; Approved by Congress as SENATE BILL (b) Encourage activities and programs which 2213/HOUSE BILL 5229, entitled: promote tourism awareness, preserve the “An Act Declaring A National country’s diverse cultures and heritage, and Policy For Tourism As An Engine instill a sense of history and a culture of tourism Of Investment, Employment, among the youth and the populace; Growth And National Development And Strengthening (c) All things being equal, grant preferential The Dot, Its Attached Agencies, To treatment to the employment of Filipino Effectively Implement That nationals in tourism-related enterprises; Policy…” (d) Provide full government assistance by way of In 1973, the Philippine government competitive investment incentives, long-term recognized the need to realign development fund and other financing schemes government efforts towards trade extended to tourism-related investments; promotion and tourism development for greater effectiveness and in order to (e) Ensure the right of the people to a balanced tap the tourist industry as a resource and healthful ecology through the promotion of base toward an accelerated activities geared towards environmental socioeconomic development in the protection, conservation and restoration; Philippines. Thus, the Department of Tourism (DOT) was created. Section 3: DEFINITION OF TERMS HIGHLIGHTS OF TOURISM ACT OF 2009 (R.A. ACCREDITION — a certification issued by the NO. 9593) Department to a tourism enterprise that officially recognizes it as having complied with Roles and Functions of DOT Pursuant to the minimum standards for the operation of R.A. 9593 tourism facilities and services. DECLARED POLICY: Tourism is an indispensable element of the national BROWNFIELD TOURISM ZONE — an area with economy and an industry of national existing infrastructure or development as interest and importance; harnessed as determined by the TIEZA. an engine of socio-economic growth/cultural affirmation, to generate CULTURE OF TOURISM — a sustainable tourism investment, foreign exchange, development principle that binds national and employment and to mold national local governments, local communities, private pride. sector and stakeholders to work together in Under this law, the PTA is reorganized as creating pride of place and sustaining a tourist TIEZA while the PCVC is reorganized as friendly destination. TPB.  Legal Aspect in Tourism and Hospitality ECOTOURISM — a form of sustainable tourism needs can be fulfilled while maintaining cultural within a natural and cultural heritage area integrity, essential ecological processes, where community participation, protection and biological diversity and life support systems. management of natural resources, culture and indigenous knowledge and practices, TOURISM DEVELOPMENT PLAN — a strategic environmental education and ethics, as well as framework that provides for the orderly and economic benefits are fostered and pursued for rational development of the tourism sector the enrichment of host communities and the within a given area, providing the policy and satisfaction of visitors. approaches to develop, promote and integrate various programs and projects such as, but not EXECUTIVE MANAGEMENT COMMITTEE — a limited to, accessibility, including infrastructure policy and program coordinating and and transportation; monitoring body composed of the Department Secretary and the heads of attached agencies MANDATORY ACCREDITATION and corporations. DOT shall prescribe and regulate standards for the operation of tourism GREENFIELD TOURISM ZONE — a new or business. pioneer development as determined by the Primary tourism enterprises shall be TIEZA. required to periodically obtain accreditation. PRIMARY TOURISM ENTERPRISES — facilities Accreditation for Secondary tourism and services that are directly related to tourism Enterprises shall be voluntary. such as, but not limited to, travel and tour services: inbound travel agencies and tour LOCAL TOURISM DEVELOPMENT operators, and tour guides; tourist transport PLANS/TOURISM OFFICERS services whether for land, sea and air transport LGU’s shall prepare local tourism exclusively or majority of its seats are for tourist development plans, land use, use, including airport taxis and tourist drivers; infrastructure development and accommodation establishments; MICE standards for tourism enterprises. organizers and facilities; Every province, city or municipality which has a significant tourism industry SECONDARY TOURISM ENTERPRISES — facilities shall have permanent position for a and services that may be related to tourism tourism officer and must also establish such as, but not limited to, restaurants; a tourist information and assistance specialty shops and department stores; sports center facilities and recreational centers such as, museums and galleries, theme parks, zoos; THE DOT AND ITS ATTACHED AGENCIES health and wellness facilities agri-tourism farms and facilities; tourism training centers or institutes The Department shall be the primary planning, programming, coordinating, SUSTAINABLE TOURISM DEVELOPMENT — the implementing and regulatory management of all resources that meet the government agency. needs of tourists and host regions while It shall instill in the Filipino the protecting the opportunities for the future, in industry’s fundamental importance in such a way that economic, social and aesthetic  Legal Aspect in Tourism and Hospitality the generation of employment, attracting, promoting, facilitating and investment and foreign exchange. servicing large scale events, international fairs and conventions, STRUCTURE OF DOT congresses, sports competitions, expositions and the like; ensuring the OFFICE OF THE SECRETARY — The Office of the regular local and international Secretary shall consist of the Secretary and his advertisement of the country’s major or her immediate staff. tourism destinations and other tourism products, including TEZs; and providing OFFICE OF THE UNDERSECRETARY FOR incentives to travel agencies, tour TOURISM DEVELOPMENT — shall be operators, wholesalers and investors responsible for the Office of Product abroad capable of drawing a sizeable Development, the Office of Tourism number of tourists and tourism Development Planning, Research and investments to the country. Information Management and the Office of Industry Manpower Development. TOURISM INFRASTRUCTURE AND ENTERPRISE ZONE AUTHORITY (TIEZA) OFFICE OF PRODUCT DEVELOPMENT — shall conceptualize and develop new products which PHILIPPINE TOURISM AUTHORITY (PTA) will enhance tourism sites and facilities; The Philippine Tourism Authority (PTA) created pursuant to Presidential Decree TOURISM PROMOTIONS BOARD (TPB) No. 189, as amended by Presidential Decree No. 564, is hereby reorganized The Philippine Convention and Visitors as the Tourism Infrastructure and Corporation (PCVC) is reorganized as Enterprise Zone Authority (TIEZA), the Tourism Promotions Board (TPB), attached to the Department of Tourism also to be referred to in this Rules as the for purposes of policy and program Philippine Tourism Promotions Board coordination. (PTPB). The Tourism Infrastructure and The PTPB shall be responsible for Enterprise Zone Authority (TIEZA) shall: marketing and promoting the designate, regulate and supervise the Philippines domestically and Tourism Enterprise Zones (TEZs) internationally as a major global established under the Act; develop, tourism destination, highlighting the manage, and supervise tourism uniqueness and assisting the infrastructure projects in the country; development of its tourism products supervise and regulate the cultural, and services, with the end in view of economic and environmentally increasing tourist arrivals and tourism sustainable development of TEZs investments; marketing the Philippines towards the primary objective of as a major Meetings, Incentives, encouraging investments therein; Conventions and Exhibitions (MICE) destination;  Legal Aspect in Tourism and Hospitality Designation of Tourism Enterprise Zones development of Intramuros as a The TIEZA shall, in coordination with monument to the Hispanic period of appropriate authorities and neighboring Philippine history. cities and municipalities, conduct a survey of the physical and natural assets The mission of IA is to protect and and potentials of the Tourism Enterprise conserve the historical and cultural Zone (TEZ) areas under its jurisdiction. value and significance of Intramuros while advancing and guiding urban General Criteria for the Designation of TEZ development within, and contributing to a) The area is capable of being defined into one the strengthening of the Filipino’s contiguous territory; national identity and sense of belonging b) It has historical and cultural significance, and pride. environmental beauty, or existing or potential integrated leisure facilities within its bounds or IA envisions Intramuros as a model within reasonable distances from it; urban site of national historical and c) It has, or it may have, strategic access through cultural heritage, sustaining people and transportation infrastructure, and reasonable life systems within, and contributing to connection with utilities infrastructure systems; national cultural and socio-economic d) It is sufficient in size, such that it may be progress. further utilized for bringing in new investments in tourism establishments and services; and NATIONAL PARKS DEVELOPMENT e) It is in a strategic location such as to catalyze COMMITTEE (NPDC) the socioeconomic development of neighboring communities. As an attached agency of the DOT, the National Parks Development Committee DUTY FREE PHILIPPINES CORPORATION is tasked to develop, preserve, and (DFPC) manage Rizal and Paco Parks in Manila and other parks that may be assigned to The DFPC is a corporate body created NPDC. pursuant to Chapter VI of the Act which has exclusive authority to operate or Its mission is to develop, preserve, and franchise out stores and shops that manage Rizal Park and Paco Park to would sell among others, duty- and ensure the general public’s appreciation tax-free merchandise, goods and of the Park’s facilities and activities. In articles to service the requirements of particular, it shall: international tourists and travelers. Provide the general public with access to and enjoyment of an open park INTRAMUROS ADMINISTRATION (IA) through well managed and maintained facilities and structures, welldeveloped IA is a National Government Agency environment through landscape design attached to the Department of Tourism and plant ornaments, while ensuring of the Philippines. Under Presidential the orderliness of the Parks as well as Decree No. 1616, IA is responsible for the safety and security of the the orderly restoration and park-goers  Legal Aspect in Tourism and Hospitality Showcase national heritage through NAYONG PILIPINO FOUNDATION (NPF) programs aimed at promoting Filipino arts, culture and tradition, and exchanges with other nations, The Nayong Pilipino Foundation Inc. conceptualize events and activities of (NPFI) was established in 1969 with a socioculture-economic-physiological primary focus on promoting research impact such as performances and development projects in social sciences, programs in order to develop national humanities, and related fields. It was consciousness registered as non-stock, non-profit corporation in May 1969. Develop new parks President Ferdinand Marcos issued Presidential Decree No. 37 in November PHILIPPINE RETIREMENT AUTHORITY (PRA) 1972, officially establishing the Nayong Pilipino Foundation. The foundation was The Philippine Retirement Authority initially given a 45.9-hectare land in (PRA) is a government owned and Pasay, part of which became the controlled corporation created by virtue Nayong Pilipino Cultural Park. of Executive Order No. 1037 PURPOSE OF NPF Signed by former President Ferdinand To promote, encourage, espouse and/or E. Marcos on 04 July 1985. initiate research and development projects on social sciences and On 31 August 2001, through Executive humanities and related fields; Order No. 26, the control and supervision of PRA was transferred to To formulate a comprehensive social the Board of Investments (BOI) – welfare program for the upliftment, Department of Trade and Industry from improvement and amelioration of the the Office of the President. social and economic conditions of the unfortunate destitute members of our On 12 May 2009, Republic Act No. society; 9593, otherwise known as Tourism Act of 2009, PRA became an attached To encourage and facilitate the active agency of the Department of Tourism participation of the domestic and and placed under the supervision of the foreign sectors in furnishing financial, Secretary. technical and other forms of assistance for the Foundation’s social welfare PRA is mandated to develop and programs; promote the Philippines as retirement haven as a means of accelerating the To promote and encourage the social and economic development of dissemination of the results of its the country, strengthening its foreign researches and studies in social sciences exchange position at the same time and humanities; providing further best quality of life to the targeted retirees in a most attractive package.  Legal Aspect in Tourism and Hospitality PHILIPPINE COMMISSION ON SPORTS SCUBA GOVERNMENT AGENCIES INVOLVED IN DIVING (PCSSD) TOURISM The Philippine Commission on the SECURITIES AND EXCHANGE COMMISSION Promotion and Development of Sports (SEC) SCUBA Diving (PCSSD) was established by Former President Ferdinand E. Marcos through Letter of Instruction The SEC is the government agency No. 745 issued on September 29, 1978. responsible for the registration, licensing, regulation and supervision of The Commission's key mandates include all corporations and partnerships promoting programs to develop the organized in the Philippines, including Philippines as a premier diving foreign corporations licensed to engage destination in Asia, formulating rules in business or to establish branch offices and safety standards for sports SCUBA in the Philippines. diving, conducting studies to incentivize private sector involvement in SCUBA The Securities and Exchange Commission (SEC) diving tourism, and implementing performs four core functions: marine conservation programs in CAPITAL MARKET DEVELOPMENT AND high-value tourist areas. REGULATION - The SEC is responsible for registering both traditional and non-traditional Additionally, the PCSSD's role was securities and also licenses and regulates reinforced by Republic Act 9593, also various market participants, including known as the Tourism Policy Act, which exchanges, brokers, dealers, traders, and others, placed the PCSSD under the to ensure the smooth and fair operation of Department of Tourism. capital markets. This act further emphasized the need COMPANY REGISTRATION AND MONITORING - for standardizing dive rules, regulating The SEC registers companies and partnerships, SCUBA sports and technical diving, and overseeing compliance with the Corporation coordinating closely with the Office of Code, Civil Code (particularly provisions on Tourism Standards and Regulations for partnerships), Foreign Investments Act, and accreditation. related laws. ENFORCEMENT - The SEC actively monitors the activities of market participants to ensure their adherence to relevant laws, rules, regulations, and policies. SUPPORT SERVICES - The SEC provides support services including financial management, human resource development and administration, and economic research and information services.  Legal Aspect in Tourism and Hospitality PROJECT ASSESSMENT GROUP (PAG) BOARD OF INVESTMENTS (BOI) PAG is in charge of evaluating, registering, supervising, monitoring and The Philippine Board of Investments giving project assistance to registered (BOI), an attached agency of the firms. Department of Trade and Industry (DTI), is the lead government agency PHILIPPINE ECONOMIC ZONE AUTHORITY responsible for the promotion of (PEZA) investments in the Philippines. BOI assists Filipino and foreign investors The Philippine Economic Zone Authority to venture and prosper in desirable (PEZA) is a government corporation areas of economic activities. established by virtue of a legislative enactment known as “The Special 4 Operating Groups Economic Zone Act of 1995.” INVESTMENT PROMOTIONS GROUP (IPG) Tasked to generate investments and PEZA is an investment promotion improve the image of the country as a agency and a government owned viable investment destination through corporation, attached to the the formulation and implementation of Department of Trade & Industry. investment promotion strategy for synchronized investment promotion It is responsible for ensuring that efforts. foreign investors who wish to put up their operations in the country will have TECHNICAL SERVICES GROUP (TSG) readily available suitable locations in Provides support services to the Board worldclass, environment-friendly and its clientele through the economic zones. enhancement of management processes, efficient dispensation of DEPARTMENT OF ENVIRONMENT AND incentives, design and implementation NATURAL RESOURCES (DENR) of information systems, rendering of legal support on investment-related issues, and conduct of human resource The Department is tasked with being development programs. the primary agency responsible for the conservation, management, INDUSTRY DEVELOPMENT GROUP (IDG) development, and proper utilization of Prepares the annual Investment the Philippines' environment and Priorities Plan. natural resources. Formulates policies and develops BUREAU OF IMMIGRATION (BI) programs/business plans/roadmaps that will hasten and sustain the Executive Order No. 292, Book IV, Title development of key industry and III, Chapter X, Section 31 specifically service sectors. delineates the mandate of the Bureau of Immigration as “the administration and enforcement of immigration,  Legal Aspect in Tourism and Hospitality citizenship, and alien admission and LAWS ON PARTNERSHIP AND CORPORATION registration laws in accordance with the provisions of the Philippine Immigration Act of 1940 (as amended), the Alien 3 KINDS OF BUSINESS OWNERSHIP Registration Act of 1950, including other pertinent laws related there. SOLE PROPRIETORSHIP A sole proprietorship is the oldest, simplest, and most prevalent form of DEPARTMENT OF LABOR AND EMPLOYMENT business enterprise. (DOLE) It is an unorganized business owned by one person. The Department of Labor and The sole proprietor is personally liable Employment (DOLE) is the primary for all the debts and obligations of the government agency mandated to business. promote gainful employment opportunities, develop human Advantages of Sole Proprietorship resources, protect workers and promote Sole enjoyment of profit their welfare, and maintain industrial Cheaper fees paid to the government peace. Low capitalization This government agency is responsible Disadvantages of Sole Proprietorship for issuing Alien Employment Permits Personally liable to all debts and (AEP) to foreign nationals who intend to obligations of the business. work in the Philippines. Burdensome because all decisions and undertakings are to be carried out by him alone. DEPARTMENT OF AGRARIAN REFORM (DAR) Limited ability to raise capital. The Department of Agrarian Reform is PARTNERSHIP the lead implementing agency of the Art. 1767 of the New Civil Code provides, Comprehensive Agrarian Reform “By the contract of partnership two or Program (CARP). more persons bind themselves to contribute money, property, or industry The DAR also orchestrates the delivery to a common fund, with the intention of of support services to farmer- dividing the profits among themselves. beneficiaries and promotes the Two or more persons may also form a development of viable agrarian reform partnership for exercise of a communities. profession.” DEPARTMENT OF AGRICULTURE (DA) A partnership exist when two or more persons agree to place their money, The Department of Agriculture (DA) is effects, labor, and skill in lawful the principal agency of the Philippine commerce or business, with the government responsible for the undertaking that there shall be a promotion of agricultural development proportionate sharing of the profits and growth. losses among them.  Legal Aspect in Tourism and Hospitality Essential Requisites of Partnership CLASSIFICATIONS OF PARTNERSHIP 1. There must be a valid contract 2. There should be contribution of either money, property, or industry to a GENERAL PARTNERSHIP common fund. Are partnership where all the partners 3. The business, object or purpose of the are general partners who are liable to partnership must be lawful. the extent of their separate property 4. The purpose of the partnership is for after the partnership asset have been profit and with the intention of dividing exhausted. the same among the partners. 5. There must be two or more persons LIMITED PARTNERSHIP with legal capacity to enter in the A partnership with one or more general contract of partnership. partners and one or more limited partners. In limited partnership, the Delectus Personae general partner will be held liable The doctrine of Delectus Personae beyond his contribution. A limited means no one can become a partner partner is however liable only to he without consent of all partners. extent of his contribution The consent of all the partners in the partnership must be obtained to enable CLASSIFICATIONS OF PARTNERS them to join the partnership. CAPITALIST PARTNER — is one who contributes Partnership has Juridical Personality Art. 1768, capital (property or money) The partnership has a juridical personality A capitalist partner is not exempt to any separate and distinct from that of each of the losses. Any stipulation to the contrary is partners. void. Once the partners formed the partnership, the partners actually INDUSTRIAL PARTNER — is one who created or formed a new person, and contributes industry or skills. that new person is the partnership An industrial partner cannot engage in itself. business for himself, unless the partnership expressly permits him to do It should be remembered that there are so, and if he should do so, the capitalist two kinds of person in law, one is partners may either exclude him from natural person or human being and the the firm or avail themselves of the second is a juridical person which is benefits which he may have obtained separate and distinct from that of each there from, with a right to damages in of the partners. either case CAPITALIST-INDUSTRIAL PARTNER — is a partner who contributed both capital and industry. GENERAL PARTNER — is a partner who is liable beyond the extent of what he has contributed.  Legal Aspect in Tourism and Hospitality LIMITED PARTNER — is a partner in a limited Doctrine of Corporate Entity partnership and is liable only to the extent of A corporation acquires juridical what he has contributed. personality from the time the Securities and Exchange Commission (SEC) issued MANAGING PARTNER — is a partner who a Certificate of Incorporation. manages the business of the Partnership. If there is no managing partner appointed, all of Once juridical personality is required, the partners shall manage. the corporation becomes separate and distinct from the person who Distribution of Profits establishes the same. Under article 1797 of the civil code, the profit of the partners shall depend upon Advantages of Corporation the agreement of the partners, in case It has strong legal personality; they failed to stipulate, the parties Free transferability of shares; share in the profit shall be in proportion Centralized Management (there is a to what he may have contributed. board); Limited liability; and Distribution of Losses It may last long The rule on distribution of losses are the same as the rule above to the effect Disadvantages of Corporation that, the share of the partner in the The process of forming corporation is losses shall be that share agreed upon. complicated; It is always subject to the control and However, if they do not agree as to how regulation of the government; and much would be their share in the losses, The operation is costly. then the share of each partner on the losses shall be in proportion to what he CLASSIFICATION OF CORPORATION may have contributed. STOCK CORPORATION - is one which has capital CORPORATION stock and is divided into shares and authorized to distribute to holders thereof of such shares in A corporation is an artificial being the form of dividends or allotments of the created by operation of law, having the surplus profits on the basis shares held. right of succession and the powers, attributes, and properties expressly NON-STOCK CORPORATION - is one which does authorized by law or incident to its not issue stocks and does not distribute existence. dividend to their members Attributes of Corporation PRIVATE CORPORATION - is one which is It is an artificial being established by private individuals for private It is created by operation of law purposes and ends. Has a right of succession It has express and implied powers PUBLIC CORPORATION - is one created by law and for public purpose.  Legal Aspect in Tourism and Hospitality CORPORATION DE JURE - is one which is on other hand, are those who compose the organized in strict compliance of all the non-stock corporation. requirements of the laws for its incorporation. CORPORATE OFFICERS — are the officers named DOMESTIC CORPORATION - is one that is in the articles of incorporation or in the by-laws formed or organized in accordance to the laws of the corporation. of the Philippines. DIRECTORS AND TRUSTEES — The Board of FOREIGN CORPORATION - is one that is formed Directors is the governing board in a stock or organized under any laws other than those of corporation. Whereas, the Board of Trustees is the Philippines and whose laws allow Filipino the governing board in a non-stock corporation. citizens and corporations to do business in its own country. POWERS OF THE CORPORATION NON-PROFIT CORPORATION - by prescription is one which was not formed formally, meaning, The powers of the corporations are classified no SEC registration, but has been recognized by into three, namely; immemorial usage as a corporation. EXPRESS POWERS — or the powers expressly CORPORATION SOLE - is a corporation granted by law to the corporation such as those established for the purpose of administering mentioned in Section 36 of the Corporation and managing, as trustee, the affairs, property Code. and temporalities of any religious denomination, sect or church. INCIDENTAL POWERS — are powers which a corporation can exercise as an incident to its ELEEMOSYNARY CORPORATION - is one that is corporate existence. organized for charitable purposes. IMPLIED POWERS — these are the powers which are necessary to execute the express powers granted to a corporation. COMPONENTS OF CORPORATION CORPORATE TERM INCORPORATORS — are the persons who A corporation shall exist for a period not originally formed the corporation. Their names exceeding fifty (50) years from the date appear in the Articles of Incorporation. The of incorporation unless sooner following are the requisites in order to become dissolved or unless said period is an Incorporator extended. The corporate term as originally stated in the articles of CORPORATORS — are those that compose that incorporation may be extended for. corporation, the board of directors, or board of trustees, stock holders or members including corporations. STOCKHOLDERS AND MEMBERS — Stockholders are person own or holders of shares of stock in a stock corporation. Members  Legal Aspect in Tourism and Hospitality LAWS RELATED TO FOREIGN INVESTMENTS IN THE PHILIPPINES THE FOREIGN INVESTMENT ACT OF 1991 [Republic Act No. 7042] The basic law that governs foreign investments in the Philippines. Liberalized the entry of foreign investments into the country up to 100% ownership unless restricted by the Constitution and other special laws as enumerated in the Foreign Investment Negative List (FINL). “Export Enterprise” shall mean an enterprise wherein a manufacturer, processor or service (including tourism) enterprise exports sixty percent (60%) or more of its output, or wherein a trader purchases products domestically and exports sixty percent (60%) or more of such purchases. “Domestic Market Enterprise” shall mean an enterprise which produces goods for sale, or renders services to the domestic market entirely or if exporting a portion of its output fails to consistently export at least sixty percent (60%) thereof;  Legal Aspect in Tourism and Hospitality For hospitality business, such as hotels and resorts, an ECC or environmental Compliance Certificate is necessary for certifying that your business activities will not cause any negative effect on the environment. In general, the Department of Environment and Natural Resources and the Environmental Management Bureau will issue the certificate within 30 working days. The Philippine government is encouraging RETAIL TRADE LIBERALIZATION ACT OF 2000 foreign investors to invest in the country with [REPUBLIC ACT NO. 8762] businesses that will provide opportunities in employment, develop the productivity of It is the policy of the State to promote resources, heighten the volume as well as the consumer welfare in attracting, value of exports and provide the future promoting and welcoming productive development of the economy’s foundation. investment that will bring down prices for the Filipino consumer, create more The Foreign Investment Act (R.A. 7042, 1991, jobs, promote tourism, assist small amended by R.A. 8179, 1996) liberalized the manufacturers, stimulate economic entry of foreign investment into the Philippines. growth and enable Philippine goods and Under the FIA, foreign investors are generally services to become globally competitive treated like their domestic counterparts and through the liberalization of the retail must register with the Securities and Exchange trade sector. Commission (SEC) (in the case of a corporation or partnership) or with the Department of Trade "Retail trade" shall mean any act, and Industry’s Bureau of Trade Regulation and occupation or calling of habitually Consumer Protection (in the case of a sole selling direct to the general public proprietorship). merchandise, commodities or good for consumption If the foreign corporation itself intends to do business in the Philippines under its foreign Republic Act No. 11595 ("RA 11595") charter, the foreign corporation must first known as "An Act amending Republic secure a “License to do Business in the Act No. 8762 or the Retail Trade Philippines” from the Philippine Securities & Liberalization Act of 2000 (RTLA), by Exchange Commission (SEC). lowering the paid-up capital requirement for foreign retail If the foreign corporation intends to do business enterprises and other purposes." in the Philippines by incorporating a Philippine company, the foreign corporation must first RA 11595 also sets a single minimum secure the approval of the SEC by filing its paid-up capital requirement of PHP 25 incorporation papers, together with million for all foreign-owned retail trade authenticated copies of its foreign charter and enterprises, and lowers the minimum by-laws. investment requirement per store to PHP 10 million.  Legal Aspect in Tourism and Hospitality (1) Removes Categories for Prequalification one (1) store capitalized at a minimum and Lowers Minimum Paid-upCapital of USD 25 million), Requirement. has a five- (5-) year track record in retailing, and a national from or juridical RA 11595 removes the categories for entity formed or incorporated in prequalification under the RTLA and countries which allow the entry of sets a single minimum paid-up capital Filipino retailers. for all types of foreign-owned enterprises. (3) Lowers Investment Per Store Requirement. RA 11595 lowers the minimum Under Category B of the RTLA, investment per store requirement for foreign-owned corporations engaged in foreign-owned retail trade enterprises retail trade must have a paid-up capital from USD 830,000 per store to PHP 10 of at least USD 2.5 million, while under million (or approximately USD 200,000). Category D, foreign-owned retail trade enterprises engaging in the sale of Under RA 119595, the "minimum high-end or luxury goods must have a investment per store" covers the gross paid-up capital of at least USD assets, tangible or intangible, including 250,000per store. but not limited to buildings, leaseholds, furniture, equipment, inventory, and Under RA 11595, all foreign-owned common use investments and facilities retail enterprises must have a minimum such as administrative offices, paid-up capital of at least PHP 25 warehouses, preparation or storage million (or approximately USD 500,000). facilities. Investments for common use and facilities, as reflected in the The new minimum paid-up capital financial statements following the requirement is subject to review by accounting standards adopted by the theDepartment of Trade and Industry SEC and DTI shall be pro-rated among (DTI), Securities and Exchange the number of stores being served. Commission(SEC), and the National Economic and Development Authority (4) Removes Requirement of Public Offering of (NEDA) every three (3) years from the Shares. law's effectivity Retail enterprises with foreign ownership of more than eighty percent (80%) are no longer (2) Removes Requirement for Certificate of required to offer a minimum of thirty percent Prequalification issued by the BOI. (30%) of their equity to the public through any Under the RTLA, foreign retailers are stock exchange in the Philippines within eight required to obtain a Certificate of (8) years from start of operations. Prequalification from the BOI upon proof that they satisfy the following (5) Promotion of Locally Manufactured pre-qualification requirements: Products. RA 11595 encourages foreign retailers a minimum net worth requirement of to have a stock inventory that are made USD 200 million; has five (5) retailing in the Philippines. branches or franchises in operation around the world (unless it has at least  Legal Aspect in Tourism and Hospitality (6) Preferential Use of Filipino Labor. for any mental disorder or disability; RA 1195 mandates compliance with the and is willing and able to invest the provisions of the Labor Code of the amount of at least USD 75,000 in the Philippines on the determination of Philippines. This type of visa grants the non-availability of a competent, able, holder an indefinite stay in the and willing Filipino citizen before Philippines, provided that the engaging the services of a foreign requirements are met and the minimum national. investment amount is maintained. (7) Change of Implementing Agency. (2) Remittance of Earnings Foreign retailers that have established The E. O. also recognizes the right of the or will establish corporations, investor to remit earnings from his associations, or partnerships engaged in investment in the currency in which the retail trade are now subject to the investment was originally made and at monitoring and regulation by the SEC, the exchange rate prevailing at the time instead of the DTI. of remittance. (8) Reduces Penalties. (3) Repatriation of Capital RA 11595 reduces the penalties In case of liquidation, the investor is provided in the RTLA for violation of its also allowed to repatriate the entire provisions from imprisonment of six (6) proceeds of the liquidation of the to eight (8) years to four (4) to six (6) investment in which the investment years, and a fine from PHP 1 million to originally made. PHP 20 million to PHP 1 million to PHP 5 million. (4) Right of Succession In case of death, the surviving immediate family shall be entitled to TOURISM INVESTMENTS LAWS AND INCENTIVES the same privileges. Incentives Granted Under Omnibus Incentives Granted Under Executive Order No. Investment Code Executive Order No. 226 63 This Executive Order grants incentives This Executive Order authorizes the to foreigners investing at least Board of Investments (BOI) to grant US$50,000 in a tourist-related project or fiscal incentives and non-fiscal in any tourist establishment as incentives for local and foreign investors determined by the Committee created engaged in tourism activities listed in the same law. under the current Investments Priorities Plan (IPP). (1) Special Investor’s Resident Visa For foreign nationals who want to A local enterprise can register its reside in the Philippines for an activity with the BOI if its project is indefinite period and must not have listed as a preferred project in the been convicted of a crime, been current IPP. Such enterprise may engage afflicted with dangerous or contagious in domestic-oriented activities listed in disease; has not been institutionalized  Legal Aspect in Tourism and Hospitality the IPP whether classified as pioneer or (5) Simplified Customs Procedures non-pioneer Customs procedures for the importation of equipment, spare parts, raw (1) Income Tax Holiday materials and supplies, exports of Income Tax Holiday is available for 4 processed products by registered years for non-pioneer enterprises or 6 enterprises shall be simplified by the years for pioneer enterprises from the Bureau of Customs. start of business commercial operations It should be within the limited to the TOURISM INVESTMENT PRIORITIES PLAN registered activity. Starting period for Income Tax Holiday is the start of commercial operation. However, in the case of expansion, income tax holiday is available for the next three (3) years. Exempt from income tax only and subject to other national or local taxes. The company is subject to regular 30% income tax after the income tax holiday Incentives Granted Under period. Build-Operate-Transfer (BOT) Law (Republic Act No. 6957, As Amended By (2) Duty Free Importation Republic Act No. 7718) Duty free-importation of capital equipment, by virtue of Executive Order The BOT Law authorizes the financing, No. 528 entitled Reducing the Rates of construction, operation and Duty on Capital Equipment, Spare Parts maintenance of infrastructure projects and Accessories Imported by (BOI) by the private sector. It allows national registered New and Expanding implementing agencies and local Enterprises. government units to enter into BOT arrangement as a means of encouraging (3) Employment of Foreign Nationals the participation of foreign and local Special non-immigrant multiple entry companies in the country’s visa given to foreign nationals under infrastructure development program. supervisory, technical or advisory position but not to exceed five (5) years Incentives Granted Under Special Economic from date of registration of the firm. Zone Act of 1995 Positions of president, treasurer and (Republic Act No. 7916) general manager may be retained by foreign national beyond 5 years for 40% The PEZA shall consider for registration foreign-owned firms. tourist-oriented enterprises to be located in PEZA-registered tourism (4) Unrestricted Use of Consigned Equipment development zones/tourism estates Machinery, equipment and spare parts which are enclosed by the DOT as consigned to any BOI-registered firm enterprises that will be established and shall not be subject to restriction as to operated with foreign tourists as period of use. primary clientele.  Legal Aspect in Tourism and Hospitality Incentives Granted Under Investors Lease Act Incentives available to Tourism Ecozone (Republic Act No. 7652) Developers & Locators are: This law encourages foreign FISCAL INCENTIVES investments by means of granting a Tourism Ecozone Developers / long-term lease of 50 years (renewable Operators shall be entitled to six (6) for another 25 years) on private lands to years of Income Tax Holiday (ITH) for foreign investors for the establishment pioneer firms and four (4) years of ITH of industrial estates, factories, assembly for non-pioneer firms, subject to the of processing plants, agro-industrial provisions of the Investment Priorities enterprises, land development for Plan (IPP), provided that Tourism industrial or commercial use, tourism, Ecozones located in Less Developed and other similar priority productive Areas shall be granted six (6) years ITH. endeavors. Enterprises establishing and operating Incentives Granted Under Executive Order 528 sports and recreation centers, This Executive Order aims to promote accommodation, convention and more investments in the Philippines by cultural facilities, theme parks, and extending to another five years the other special interest or attraction duty-free privileges on the importation activities / establishments shall be of capital equipment by businesses entitled to 4 ITH, as may be provided in registered as new and expanding and in accordance with the provisions enterprises by the Board of Investments of the IPP, and tax and duty-free (BOI). importation of capital equipment required for the technical viability and operation of the registered activities of the enterprises. Enterprises establishing and operating airports, seaports and / or marinas shall be entitled to the ITH incentive, as may be provided in and in accordance with provisions of the IPP, and tax and duty-free importation of capital equipment. NON-FISCAL INCENTIVES A. Employment of foreign national, as provided under R.A. No. 7916; B. Special Investor’s Resident Visa, as provided under Executive Order No. 63; and C. Incentives under the Build-Operate-Transfer Law, as may be applicable, subject to prescribed guidelines.  Legal Aspect in Tourism and Hospitality for forest, mineral, and land resources ENVIRONMENTAL LAWS ON TOURISM AND HOSPITALITY of a growing population Enhance the contribution of natural “The State shall protect and advance the right resources for achieving national of the people to a balanced and healthful economic and social development. ecology in accord with the rhythm and harmony of nature”. - Section 16, Article II of the 1987 Promote equitable access to natural Philippine Constitution resources by the different sectors of the population. “All lands public domain, waters, minerals, coal, petroleum, and other mineral oils, all sources of Conserve specific terrestrial and marine potential energy, fisheries, forests or timber, areas representative of the Philippine wildlife, flora and fauna, and other natural natural and cultural heritage for present resources are owned by the State”. - Article XII and future. of the 1987 Philippine Constitution – National Economy and Patrimony Initially established as a supporting body for the Department of Environment and Natural Philippine Environmental Policy (P.D. 1151) Resources in 1987, the Philippine Create, develop, maintain, and improve Environmental Management Bureau (EMB) conditions under which man and nature became a line bureau with its own offices and can thrive in productive and enjoyable independent enforcement authority in 2002. It harmony with each other; is the national authority responsible for Fulfill the social, economic, and other pollution prevention and control, and requirements of present and future environmental impact assessment. generations of Filipinos; and Ensure the attainment of an EMB is guided by the vision of a nation environmental quality that is conducive empowered to protect its finite natural to a life of dignity and well-being. resources in pursuit of sustainable development, to ensure a healthy environment The Department is mandated to be the primary that enhances the Filipino quality of life for agency responsible for the conservation, present and future generations. Its mission is to management, development, and proper use of restore, protect, and enhance environmental the country’s environment and natural quality towards good public health, resources. environmental integrity, and economic viability. To accomplish this mandate, the Department shall be guided by the following objectives: ENVIRONMENTAL LAWS OF THE PHILIPPINES Assure the availability and sustainability P.D.1586 - ENVIRONMENTAL IMPACT of the country's natural resources STATEMENT SYSTEM OF 1978 through judicious use and systematic R.A. 9729 - CLIMATE CHANGE ACT OF 2009 restoration or replacement, whenever R.A. 8749 - CLEAN AIR ACT OF 1999 possible R.A. 9275 - CLEAN WATER ACT OF 2004 R.A.9003 - PHILIPPINE ECOLOGICAL SOLID Increase the productivity of natural WASTE MANAGEMENT ACT OF 2000 resources in order to meet the demands  Legal Aspect in Tourism and Hospitality R.A. 9512 - ENVIRONMENTAL AWARENESS AND Environmental Impact Statement EDUCATION ACT OF 2008 The EIS System requires completion of an EIA and preparation of an EIS report for any Environmentally Critical Project PHILIPPINE ENVIRONMENTAL IMPACT (ECP) or any project located in an STATEMENT SYSTEM (PEISS) Environmentally Critical Area (ECA) to justify why the project should be Presidential Decree 1586 which was implemented. ratified on June 11, 1978 also contains the predicted impact The main objective of this law is to which is most likely to occur and affect maintain the balance between the the environment and the surrounding environment and the socio-economic communities as well. development of the country. It aims to protect the environment despite the EIS also covers the monitoring program increasing demand of natural resources for different environmental media such and development to attain as air, water, soil and development sustainability. programs for the existing community. The PEISS sets a systematic Upon the approval of the EIS, an Environmental Impact Assessment (EIA) Environmental Compliance Certificate System to ensure that the Filipino will be issued by the Environmental people will enjoy a balance and healthy Management Bureau. ecology in the midst of extensive economic development The country’s statutory framework requiring EIA for all projects that will affect environmental quality is embodied in P.D. 1151 of 1977. Environmental Impact Assessment represent both a process and a set of information. normally undertaken in compliance with environmental laws to determine the CATEGORIZATION OF PROJECTS environmental effects of a proposed action prior to its implementation. Category A - projects or undertakings which are a management tool to arrive at the right classified as environmentally critical projects decisions and not as a means to justify (ECPs) under Presidential Proclamation No. predetermined notions. 2146 (1981), Proclamation No. 803 (1996), and any other projects that may later be declared as such by the President of the Philippines.  Legal Aspect in Tourism and Hospitality Category B - projects or undertakings which are ENVIRONMENTAL CRITICAL AREAS (ECA) not classified as ECP under Category A, but All areas declared by law as national which are likewise deemed to significantly affect parks, watershed reserves and wildlife the quality of the environment by virtue of preserves and sanctuaries; being located in Environmentally Critical Area Areas set aside as aesthetic potential (ECA) as declared under Proclamation 2146 and tourist spots; according to the parameters set forth in the Areas which constitute the habitat for succeeding sections. any endangered or threatened species of indigenous Philippine wildlife (flora Category C - projects or undertakings not falling and fauna) under Category A or B which are intended to Areas of unique historical, archeological directly enhance the quality of the environment or scientific interests; or directly address existing environmental Areas which are traditionally occupied problems. by cultural communities or tribes; Areas frequently visited and/or hard-hit Category D - projects or undertakings that are by natural calamities (geological deemed unlikely to cause significant adverse hazards, floods, typhoons); impact on the quality of the environment Areas with critical slopes; according to the parameters set forth in the Areas classified as prime agricultural Screening Guidelines. These projects are not lands; covered by the Philippine EIS system and are Aquifers recharge areas; Water bodies; not required to secure an ECC. Mangrove areas; Coral reefs ENVIRONMENTALLY CRITICAL PROJECTS (ECP) Heavy Industries - Non-ferrous metal NON-ENVIRONMENTALLY CRITICAL PROJECTS industries / Iron and steel mills / The non- environmentally critical Petroleum and petro-chemical project or projects that are not located industries / Smelting plants in environmentally critical areas are required to submit a Project Description Resource Extractive Industries - Major Report which indicates the mining and quarry projects / Forestry environmental measures basic products / Logging Major wood information about the proposed processing projects / Introduction of project. Upon its approval, Certificate of fauna (exotic-animals) into public or NonCoverage or CNC will be issued by private forests /Forest occupancy / the Environmental Management Extraction of mangrove products / Bureau. Failure to comply with this law Grazing / Fishery projects / Dikes and has a corresponding punishment, e.g. fishpond development projects suspension or cancellation of certificates or fine not exceeding Php Infrastructure Projects - Major dams / 50,000.00. Major power plants (fossil-fueled, nuclear-fueled, hydro-electric or geothermal) / Major reclamation projects / Major roads and bridges All Golf Courses (Proclamation No. 803)  Legal Aspect in Tourism and Hospitality water, air and land resources harmful, Before your hospitality business can operate in detrimental or injurious, to public health, safety the Philippines, it also needs to acquire an or welfare or which will adversely affect their Environmental Compliance Certificate (ECC). utilization for domestic, commercial, industrial, agricultural, recreational or other legitimate An ECC is necessary for certifying that purposes your business activities will not cause any negative effect on the environment. When harmful substances contaminate the environment, it is called pollution. It refers to An ECC is a document issued by the the very bad condition of the environment in DENR/EMB after a positive review of an terms of quantity and quality. ECC application. ECC certifies that based on the representations of the Control is one of the managerial functions like proponent, the proposed project or planning, organizing, staffing and Directing. It undertaking will not cause significant helps to check the errors and to take the negative environmental impact. In corrective action so that deviations from general, the Department of standards are minimized and stated goals of the Environment and Natural Resources and organization the Environmental Management Bureau will issue the certificate within 30 Pollution control is the process of reducing or working days. eliminating the release of pollutants into the environment. It is regulated by various environmental agencies which establish pollutant discharge limits for air, water, and land. A Pollution Control Officer (PCO) is a person engaged in environmental protections and environmental compliance. The main goal is to provide and establish companies’ Objective, Targets and Programs that will help the company and the organization on the preservation of our natural resources, reduce the generations of the company waste and establish proper mitigation on pollutions controls in the environment. R.A 8749 THE PHILIPPINE CLEAN AIR ACT Any alteration of physical, chemical or biological Provides for a comprehensive air quality properties of any water, air, and/or land management policy and program which resources of the Philippines OR ANY DISCHARGE aims to achieve and maintain healthy OR EMISSION thereto of any liquid, gaseous or air for all Filipinos. solid wastes as will likely create or render such  Legal Aspect in Tourism and Hospitality Protect and advance the right of people R.A. 9275 THE PHILIPPINE CLEAN WATER ACT to a balanced and healthy ecology in accord with the rhythm and harmony of nature; The law aims to protect the country’s Attain and maintain a balance between water bodies from land-based pollution development and environmental sources (industries and commercial protection; establishments, agriculture and Maintain a quality of air that protects community/household activities) It human health welfare provides for a comprehensive and integrated strategy to prevent and R.A. 3931 minimize pollution through a An Act Creating the National Water and multi-sectoral and participatory Air Pollution Control Commission approach involving all the stakeholders. provided the basis for air quality management when it declared a PROHIBITED ACTS UNDER SEC. 27 OF R.A. 9275 national policy to maintain reasonable OF 2004 standards for purity for the water and Discharging or depositing materials that the atmospheric air vis-à-vis their could pollute any water body utilization for domestic, agricultural, Discharging regulated pollutants industrial and other legitimate uses. without a valid discharge permit Undertaking activities in violation of P.D. P.D. 984 - National Pollution Control Decree An 1586 Act Creating the National Water and Air Transport or discharge of prohibited Pollution Control Commission provided the chemicals under RA 6969 basis for air quality management when it Transport or dumping of solid wastes declared a national policy to maintain under R.A. 9003 reasonable standards for purity for the water Transport or dumping of solid wastes and the atmospheric air vis-à-vis their utilization into sea waters for domestic, agricultural, industrial and other Transport or dumping of solid wastes legitimate uses. into sea waters Refusal to allow entry, inspection, and Prohibitions in Clean Air Act monitoring by the DENR In order to achieve clean air, we need Refusal to allow access to relevant clean fuels. reports The CAA provides for the: complete phase-out of leaded gasoline What is SOLID WASTE? lowering of the sulfur content of It is defined as any discarded material industrial and automotive diesel that is abandoned by being disposed of, lowering of aromatics and benzene in burned or incinerated, recycled or unleaded gasoline considered "waste-like." A solid waste can physically be a solid, liquid, semi-solid, or container of gaseous material.  Legal Aspect in Tourism and Hospitality SOLID WASTE MANAGEMENT 6. Promotion of eco-labeling and prohibition on Solid waste management is defined as non environmentally acceptable products and the discipline associated with control of packaging; generation, storage, collection, transport or transfer, processing and 7. Establishment of Materials Recovery Facility disposal of solid waste materials in a (MRF) in every barangay or cluster of barangays; way that best addresses the range of public health, conservation, economic, 8. Prohibition against the use of open dumps aesthetic, engineering, and other and setting of guidelines/criteria for the environmental considerations. establishment of controlled dumps and sanitary landfills; RA 9003: PHILIPPINE ECOLOGICAL SOLID 9. Provision of rewards, grants and incentives WASTE MANAGEMENT ACT (PESWMA) OF both monetary and non-monetary to encourage 2000 LGUs and the public to undertake effective SW management; It provides the legal framework for the country’s systematic, comprehensive, 10. Promotion of research on SWM and and ecological solid waste management environmental education in the formal and program that shall ensure protection of non-formal sectors. public health and the environment. KEY FEATURES OF THE SOLID WASTE RA 9729: CLIMATE CHANGE ACT OF 2009 MANAGEMENT ACT 1. Creation of the National Solid Waste Management Commission (NSWMC), the RA 9729 aims to systematically integrate Ecology Center (NEC), and the Solid Waste the concept of climate change in the Management Board (NSWMB) in every policy formulation and development province, city and municipality in the country. plans of all government agencies and units, to the end that the government 2. Formulation of 10-year SW plans by local will be prepared for the impact of government units; climate change. 3. Mandatory segregation of SW to be ENVIRONMENTAL AWARENESS AND conducted at the source; EDUCATION ACT OF 2008 4. Setting of minimum requirements to ensure systematic collection and transport of wastes It’s an Act to promote environmental and the proper protection of garbage collectors’ awareness through Environmental health; Education (EE) and covers the integration of EE in the school curricula 5. Establishment of reclamation programs and at all levels, be it public or private, buy-back centers for recyclable and toxic including daycare, preschool, non materials; formal, technical, vocational, indigenous learning and out-of school youth courses or programs.  Legal Aspect in Tourism and Hospitality THE GLOBAL SUSTAINABLE TOURISM CODE OF ETHICS for TOURISM and COUNCIL (GSTC) HOSPITALITY is managing the GSTC Criteria, global “UNWTO is guided by the belief that tourism standards for sustainable travel and can make a meaningful contribution to people’s tourism; as well as providing lives and our planet. This conviction is at the international accreditation for very heart of the Global Code of Ethics for sustainable tourism Certification Bodies. Tourism, a roadmap for tourism development. The Global Sustainable Tourism Council GLOBAL CODE OF ETHICS FOR TOURISM (GSTC) establishes and manages global Adopted in 1999, it serves as a frame of sustainable standards, known as the reference for responsible and GSTC Criteria. There are two sets: sustainable tourism, Destination Criteria for public It is a set of principles designed to guide policy-makers and destination key-players in tourism development and managers, and Industry Criteria for aims to help maximize the sector’s hotels and tour operators. These are the benefits while minimizing its potentially guiding principles and minimum negative impact on the environment, requirements that any tourism business cultural heritage and societies across or destination should aspire to reach in the globe. order to protect and sustain the world’s The GCET has 10 Articles which covers natural and cultural resources, while social, environmental, cultural and ensuring tourism meets its potential as economic aspects of tourism a tool for conservation and poverty alleviation. The Global Sustainable Tourism Council (GSTC) Criteria and Suggested Indicators for Tour Operators were created in an effort to come to a common understanding of sustainable tourism, and are the minimum that a Tour Operator (a provider, operator, and/or seller of travel products) business should aspire to reach. Legal Aspect in Tourism and Hospitality  Legal Aspect in Tourism and Hospitality ETHICS IN HOSPITALITY TENACITY - Have perseverance. Know what you Ethics are especially important in the need to accomplish and see that you get it hospitality industry because workers are done. faced with a broad range of ethical dilemmas. FAIRNESS - Use the lens of realistic optimism to In an ethical dilemma, a person chooses understand all sides to the story before passing between doing what is wrong, or doing judgment. what is ethical because it is the right thing to do. ETHICS IN HOSPITALITY RESPECT - is a three pronged ethic comprised of craft, guest and self. KINDNESS - Every day, make someone else feel special. INTEGRITY - Always be honest w/ your guests and with your teammates. COMMUNICATION & HONESTY - The answers you give and promises you make to guests and teammates must be accurate and true. SINCERITY - Stay true to your word. TRUSTWORTHINESS - Trust translates to the successful completion of assignments and the work of holding oneself accountable for it LOYALTY - Guest loyalty can only be achieved through customer satisfaction. GENEROSITY - Generosity means always offer the extras. Provide upgrades whenever possible. ENTHUSIASM - Be eager to please your guests and team members. EXCELLENCE - The service and products you provide your guests must be at the highest level of your standards