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The shift to PEZA visas


By virtue of Republic Act No. 7916, the Philippine Economic Zone Authority (PEZA) was created to establish various economic zones and attract legitimate foreign investments into the country. The PEZA administers certain incentives to local enterprises that operate within these economic zones and helps facilitate their respective business operations. In line with these policies, the PEZA exercises the authority to issue work visas to their foreign personnel, particularly those who hold executive positions (i.e., Presidents, Vice-Presidents, Treasurers, General Managers, or their equivalents), or whose employment is supervisory, technical, or advisory in nature.

On Nov. 11, the PEZA and the Bureau of Immigration (BI) entered into a Memorandum of Agreement (MoA) to provide efficient and harmonized rules on the issuance of work visas to qualified foreign nationals and their dependents. Previously, these foreign nationals were qualified to secure 47(a)(2)(PEZA) visas under the authority of the Department of Justice (DoJ). Under the new rules, however, these foreign nationals shall now secure PEZA Visas (PV) from the PEZA and BI.

Among the notable changes introduced in the MoA is the longer validity of the PV. The PV is valid for a maximum period of two years, and is coterminous with the period stated in the foreign national’s employment contract. The application shall also come with a notarized certification which confirms that the company’s total number of foreign personnel does not exceed 5% of its total workforce.

Marriage and birth certificates of the PV applicant’s dependents are now required to be authenticated/apostilled, if issued abroad. Notably, English-translated certificates were previously accepted by PEZA even if they were unauthenticated.

Further, the PEZA and BI now require the visa holder to train Filipino understudies. While the MoA and its corresponding Implementing Rules and Regulations (IRR) did not discuss the specific guidelines for this requirement, the PEZA and BI have announced that they will issue another Memorandum Circular to clarify and address the same.

As regards the procedure, the PEZA shall issue an Order within five working days from receipt of the PV application, and shall endorse the same to the BI for further evaluation. Once the BI is satisfied that the foreign national possesses all of the qualifications for the issuance of a PV, it shall thereafter issue an Order which approves the PV application.

The PV holder continues to be exempt from securing an Alien Certificate of Registration Identification Card (ACR I-Card), but will instead be issued with a PV Card that must be updated yearly.

Under the new IRR, the company, through a visa downgrading application, shall also notify the PEZA of the PV holder’s termination or cessation of employment within five working days therefrom. The failure to do so shall be a valid ground for denial of the Company’s future PV applications. Once the visa downgrading application is approved, the foreign national shall be given a 9(a)/temporary visitor visa and will be allowed to stay in the Philippines as a tourist for a period of 59 days, commencing on the expiration date of his PV, or from the cessation of his employment with his previous employer. The foreign national with a downgraded PV shall nonetheless be required to leave the country within the period prescribed in the visa downgrading order.

In a joint briefing on Nov. 22, the PEZA and BI clarified that PV holders whose employment was terminated or whose visas have expired while they were abroad shall be required to undergo the visa downgrading process upon returning to the Philippines. Their PVs would have to be downgraded to 9(a)/temporary visitor visas before they may apply for another visa category.

All valid and existing 47(a)(2)(PEZA) visas at this time shall remain valid. However, if the PEZA-registered enterprise intends to renew their foreign personnel’s 47(a)(2)(PEZA) visas, they must accordingly convert them to PVs before they expire. Otherwise, the 47(a)(2)(PEZA) visas of these foreign nationals shall be downgraded to 9(a)/temporary visitor visas and will come with Orders to Leave (OTL).

An expired 47(a)(2)(PEZA) visa shall be downgraded to a 9(a)/temporary visitor visa, without a corresponding OTL, if the 47(a)(2)(PEZA) visa holder will continue to be employed by the same PEZA-registered entity. Once the visa is downgraded, the company should cause the conversion of the foreign national’s 9(a)/temporary visitor visa to a PV so that his employment in the Philippines will continue to be authorized.

Unlike 47(a)(2)(PEZA) visa applications, it appears that PV applications will no longer go through the evaluation and endorsement of the DoJ. This seems to be contrary to the mandate of Section 47(a)(2) of the Philippine Immigration Act which authorizes the President, through the Secretary of Justice, to admit foreign personnel of PEZA-registered entities as special non-immigrants in the Philippines.

While the representatives of PEZA and BI may conduct periodic inspections to ensure proper compliance with the MoA and its IRR, the effective implementation of these guidelines is crucial in regulating the employment of foreign nationals who are working for PEZA-registered enterprises.

This article is only for general informational and educational purposes and is not offered as and does not constitute legal advice or opinion.

Napoleon L. Gonzales III is a senior associate of the Immigration Department of the Angara Abello Concepcion Regala & Cruz Law Offices (ACCRALAW).

(632) 8830-8000

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