6 Reasons Why Businesses Should Consider Applying for PEZA Accreditation

The Philippine Economic Zone Authority, or PEZA, is an agency of the Philippines’ Department of Trade and Industry (DTI) that is tasked with bringing fresh foreign investment into the country. PEZA is known mainly for its oversight of Special Economic Zones in the Philippines, which house export-oriented service and manufacturing facilities located on prime industrial real estate spots.

New foreign investors are encouraged to explore activity within PEZA’s competitively priced and ready-to-occupy economic zones and to tap the Philippines’s wealth of resources and talent. To take full advantage, businesses should undergo the process of PEZA accreditation.

PEZA accreditation, plus the awarding of specific incentives, is done on a case-to-case basis. The process also requires foreign companies seeking to do business within one of the Special Economic Zones to pass exhaustive requirements, such as a feasibility study, copies of supply contracts, registration with the Philippines’s Securities and Exchange Commission, and articles of incorporation. But if their application is successful, PEZA-accredited members will generally enjoy greater ease of doing business in the Philippines thanks to a number of fiscal and non-fiscal benefits.

Below are the top six reasons to consider applying for PEZA accreditation. Thanks to these perks, foreign investors will get the highest returns out of their expansion efforts in the Philippines.

PEZA-Accredited Members Receive Income Tax Holidays

One significant advantage of securing PEZA accreditation is the eligibility for tax holidays. PEZA-registered enterprises receive 100% exemption from corporate income tax for a certain number of years, depending on the zone they’re doing business in. The prospect of a tax holiday for several years should be an enticing one to foreign businesses, as this can help offset the costs of operating overseas.

PEZA-Accredited Members Enjoy Tax- and Duty-Free Importation

Tax- and duty-free importation is another key benefit of PEZA accreditation. Successfully registered businesses don’t have to make a payment of duty in order to import raw materials, capital equipment, IT equipment, machineries, or spare parts. It won’t be as costly to bring in the materials, equipment, and technology needed to replicate the business environment from the company’s home region. That, in turn, means that the business can immediately start operations within the Special Economic Zones on a good note.

PEZA-Accredited Members Are Eligible for a Wide Range of Financial Exemptions

Other financial exemptions that PEZA-accredited members can partake of are exemptions from wharfage, impost fees from the national and local government, and expanded withholding tax. Ultimately, this means that the business will pay less for income payables, for the cost of transportation, and for the municipal cost of using a new development. These savings will definitely make a difference in terms of the overall cost of doing business in the country.

PEZA-Accredited Members Benefit from Streamlined Import and Export Procedures

Beyond fiscal benefits, PEZA-registered enterprises will also receive priority assistance in their importation and exportation activities. PEZA’s Electronic Permit System and Automated Export Documentation System, for example, will ensure the swift and efficient processing of business permits and registration requirements. Having that kind of “express lane” for logistical requirements will be a huge relief for foreign entrepreneurs.

PEZA-Accredited Members Will Receive Visa-Related Privileges

Certain staff members from PEZA-accredited companies will also be assured of stress-free entry into the country. The accreditation status will also make special non-immigrant visas more accessible for chief investors, company officers, and staff in advisory, supervisory, and technical positions. The same visa privileges will also apply to their spouses and to unmarried children who are under 21 years old. Thus, it won’t be difficult to transition into a new life in the Philippines and to raise a family in the country.

PEZA-Accredited Members Can Promise Career Mobility to Non-Resident Foreign National Employees

Lastly, there are some exciting career prospects for non-resident foreign nationals employed in PEZA-accredited companies. Even if they are not Filipino citizens, these employees can enjoy long and sustainable careers in the Philippines if they work as supervisors or technical advisers. They also have a chance to move up the ladder in their organization, all in a way that may not have been possible within their country of origin.

Final Words: The Difference That PEZA Accreditation Will Make

Foreign investors who have an eye on the Philippines should explore what’s needed to secure PEZA accreditation. Having this credential may lead to long-lasting success in outsourcing and offshoring activities in the country. There’s no doubt that the Philippines’ geography, economic conditions, technological expertise, and homegrown talent could contribute significantly to the growth of a foreign enterprise.

But PEZA accreditation will speed up the rates of return and make the investment a lot easier to grow into. If your company is looking to expand and to make an impact in the Philippines, find out the most up-to-date requirements for applying for PEZA accreditation—and start on the process as soon as possible!