PEZA BOI Comparison

PEZA Philippines Economic Zone Authority

PEZA vs BOI Registration for your Company     

The Government of the Philippines has put in place several incentive programs and tax breaks to attract foreign and local investors. The two main agencies implementing those incentives are  BOI and  PEZA. Dayanan Business Consultancy will assist you in choosing and registering with the correct agency for your business to receive the appropriate benefits. There are several things to take into consideration, such as whether your main activities will be export or domestic oriented, if they are part of the Investment Priorities Plan (IPP)  in effect, and where your project will be located and operated.

Requirements and Registration Procedure

  • Corporate Location:
    In order to register with PEZA a company must be located in one of the PEZA assigned Ecozones, whereas the BOI does not have any location requirements (if not part of the IPP program).
  • Registration :
    • PEZA:
      • Required Documents part of PEZA application:
      • Project brief
      • Anti-graft certificate
      • Board Resolution commissioning the designation of a representative
      • SEC Certificate of Registration
      • Project feasibility study
      • Evaluation of Application, this step can be relatively quick depending on the availability of the the board.
      • Presentation to PEZA for review by the board, which will decide on the exact incentives granted to the project.
    • BOI:
      • Required Documents part of BOI application:
      • Three copies of the BOI application Form 501
      • Three copies of the project report and supporting documents
      • Feasibility Plan
      • 5 year financial outline
      • Preparation of Project Evaluation report by the Project Evaluation and Registration Department Project (PERD) and its presentation to the BOI management committee
      • The registration procedure can take from 2 to 3 weeks depending on the project.

Filing Fees
Required application fees:

  • PEZA
    • Application of a New Non-Pioneer Project                     P3,600.00
    • Application of a New Pioneer Project                              P6,000.00
    • Additional registration fee for all new projects              P6,000.00
  • BOI
    There are both an application and a registration fee to be paid, the amounts of which depend of the size of the initial investment for the project. Application fee summary:


    • Project cost below P3 million                                                              P1,500.00
    • Project cost exceeding P3 million (but not over P4million)            P1,500.00
    • Project cost exceeding P4 million (but not over P20 million)        P3,000.00
    • Project cost exceeding P20 million (but not over P50 million)      P4,500.00
    • Project cost exceeding P50 million                                                     P6,000.00

Export Commitment
In order to register with the PEZA or BOI there are some specific export commitments to respect.

  • For an IT company there is no export commitment required
  • A company majority owned by Filipino citizens, must export a minimum of 50% of its total service/products annually
  • A company majority owned by foreigners, must export a minimum of 70% of its services/products annually
  • BOI
    • For Filipino owned companies there is no export commitment necessary
    • A business that is majority foreign owned (40% and more), must export at a minimum of 70% of its services/products annually
    • A business engaged in pioneer activities has no export commitment and hence may sell all of its services/products in the Philippines, as long as it complies with the Foreign Investment Act’s (FIA) requirements.

    Tax Incentives
    A company registering with the PEZA or the BOI can avail from a number of tax incentives and benefits.

    • PEZA
      • Offshore profit remittances, which is not subject to remittance tax.
      • Income Tax Holiday (ITH) for 4 years for Non-Pioneer IT Enterprises, or 6 years for Pioneer IT Enterprises.
      • After the ITH period is over, companies can opt  to pay a special 5% tax on gross income instead of all national/local taxes.
      • This does not apply to real property taxes for developers-owned land.
      • Exemption on import duties/taxes on imported machinery, equipment and raw materials.
      • Supplementary deduction equivalent to 50% of training expenses, which is chargeable against the 3% share of the national government of the special 5% tax on gross income;
      • Permanent resident status is granted to foreign investors when they make an initial investments of US$50,000.00 or more.
      • Exemption from Branch Profit Remittance tax for PEZA-registered branches of foreign firms.
      • Other incentives can also be granted as determined by the PEZA Board.
    • BOI
      • 3 to 8 years Income Tax Holiday (ITH)
      • 4 to 6 years exemption from local business taxes for pioneer and non-pioneer industries
      • Exemption from Taxes and Duties on imported spare parts
      • Exemption from Wharf Dues, Export Tax, Duty, Impost and Fees
      • Tax Exemption on Breeding Stocks and Genetic Materials
      • Tax Credits
      • Additional Deductions from Taxable Income

    Industries Supported
    PEZA and BOI each want to attract investments from the following industries in order to expand  the economic development of the Philippines.
    The industries supported are :

    • PEZA
      • Software Development and Application
      • IT-enabled Services (Call centers, Data Encoding, Transcribing and Processing, Directories…)
      • Content Development for the Internet and other forms of media
      • Knowledge Based and Computer Enabled Support Services (Engineering, Architectural design services, and Consultancies)
      • Business Process Outsourcing (BPO)
      • IT research and other IT related services
    • BOI
    • Investment Priority Plan (IPP):
    • Agriculture/Agribusiness and Fishery
    • Infrastructure
    • Manufactured Products
    • Business Process Outsourcing (BPO)
    • Creative Industries
    • Strategic Activities
    • Green Projects
    • Disaster Prevention, Mitigation and Recovery Projects
    • Research and Development and Innovation
    • Mandatory List:
    • Forestry
    • Mining
    • Printing, Publication and Content Development of Books or Textbooks
    • Downstream Oil Industry
    • Ecological Solid Waste Management
    • Clean Water
    • Magna Carta for Disabled Persons
    • Renewable Energy
    • Tourism
    • Export Activities:
    • Production and Manufacture of Export Products
    • Export Services
    • Activities in Support of Exporters
  • BOI Philippines Board of Investments

    The Philippines’ Board of Investments (BOI) operates under the authority of the Department of Trade and Industry (DTI). The BOI is the leading government agency for promoting local and foreign investments in the Philippines. By focusing on globally competitive industries, the BOI’s aim is to stimulate economic prosperity and employment for the country. The agency promotes the sustainable use of the state’s resources and the cooperation of the government with private investors through preferred areas of business which are published once a year in the Investment Priorities Plan (IPP). The IPP is drawn up  by an inter-agency delegation and approved by the President; it lists specific areas of activities which qualify a business for incentives.

    Projects registered with the BOI can avail from fiscal incentives and tax breaks:

    •Income Tax Holiday *
    •Exemption From Wharf Dues and Export Tax, Duty, Impost and Fees
    •Exemption From Taxes and Duties on Imported Spare Parts
    •Tax Exemption on Breeding Stocks and Genetic Materials
    •Tax Credits
    •Additional Deductions from Taxable Income

    * 3 to 8 years of Income Tax Holiday and 4 to 6 years of local business tax exemption respectively for non-pioneer and pioneer industries.

    There are different requirements for pioneer and non-pioneer industries.

    •  Pioneer industries: 100% foreign owned companies are entitled to incentives if:

    ◊ at least 70% of their services/products are intended for export, or
    ◊ its projects are undertaken in less-developed areas of the Philippines as listed by the BOI.

    These enterprises are required to attain 60% Filipino-ownership within 30 years of registration  with the BOI unless they are exporting or intend to export 100% of their services/production.

    •  Non-pioneer industries: Foreign ownership is limited to 40%, unless 70% of the  annual production is exported.

    Incentives may still be granted to businesses whose activity is not included in the IPP, under one of these conditions:

    1) The enterprise is at least 60% Filipino-owned  and 50% or more of the services/products are intended for export , or

    2) The company is more than 40%  foreign-owned and 70% or more of the services/products is intended for export.

    Note: Outsourcing, Back Office, Call Centers, BPO, KPO, LPO and FPO activities are considered 100% export.

    For all local and foreign companies wishing to register at the BOI, Dayanan Philippines Business Consultancy will:

    – Ascertain if your  business qualifies for BOI incentives
    – Assist in finding a BOI approved location
    – Prepare  and submit of all the required documents  for Philippines BOI registration