Article 51p. 51

NATURAL RESOURCES AND ENVIRONMENTAL LAWS STATUTES and IMPLEMENTING RULES AND REGULATIONS

applicable fiscal and non-fiscal incentives as provided for

under Executive Order No. 226, otherwise known as the

Omnibus

Investments

Code

of 1987. Provided, That

holders of exploration permits may register with the

Board of Investments and be entitled to the fiscal

incentives granted under the said Code for the duration

of the permits or extensions thereof: Provided, further,

That mining activities shall always be included in the

investment priorities plan.

Section 91

Incentives for Pollution Control Devices

Pollution

control

devices

acquired,

constructed

or

installed

by contractors shall not be considered as

improvements on the land or building where they are

placed, and shall not be subject to real property and

other taxes or assessments: Provided, however, That

payment

of

mine

wastes

and

tailings

fees

is

not

exempted.

Section 92

Income Tax-Carry Forward of Losses

A net operating loss without the benefit of incentives

incurred in any of the first ten (10) years of operations

may be carried over as a deduction from taxable income

for the next five (5) years immediately following the year

of such loss. The entire amount of the loss shall be

carried over to the first of the five (5) taxable years

following the loss, and any portion of such loss which

exceeds the taxable income of such first year shall be

deducted in like manner from the taxable income of the

next remaining four (4) years.

Section 93

Income Tax-Accelerated Depreciation

Fixed assets may be depreciated as follows:

a. To the extent of not more than twice as fast as the

normal rate of depreciation or depreciated at normal

rate of depreciation if the expected life is ten (10) years or

less; or

b. Depreciated over any number of years between five (5)

years and the expected life if the latter is more than ten

(10) years, and the depreciation thereon allowed as

deduction

from taxable income: Provided, That the

contractor notifies the Bureau of Internal Revenue at the

beginning of the depreciation period which depreciation

rate allowed by this section will be used.

In

computing

for taxable income, unless otherwise

provided in this Act, the contractor may, at his option,

deduct

exploration

and

development

expenditures

accumulated at cost as of the date of the prospecting or

exploration

and

development

expenditures

paid

or

incurred during the taxable year: Provided, That the total

amount deductible for exploration and development

expenditures shall not exceed twenty-five per centum

(25%) of the net income from mining operations. The

actual exploration and development expenditures minus

the twenty-five per centum (25%) net income from

mining shall be carried forward to the succeeding years

until fully deducted.

Net income from mining operation is defined as gross

income from operations less allowable deductions which

are necessary or related to mining operations. Allowable

deductions shall include mining, milling and marketing

expenses, depreciation of properties directly used in the

mining operations. This paragraph shall not apply to

expenditures for the acquisition or improvement of

property

of

a

character

which

is

subject

to

the

allowances for depreciation.

Section 94

Investment Guarantees

The contractor shall be entitled to the basic rights and

guarantees provided in the Constitution and such other

rights recognized by the government as enumerated

hereunder:

a. Repatriation of investments. The right to repatriate the

entire

proceeds

of

the

liquidation

of

the

foreign

investment in the currency in which the investment was

originally made and at the exchange rate prevailing at

the time of repatriation.

b. Remittance of earnings. The right to remit earnings

from the investment in the currency in which the foreign

investment was originally made and at the exchange

rate prevailing at the time of remittance.

c. Foreign loans and contracts. The right to remit at the

exchange rate prevailing at the time of remittance such

sums as may be necessary to meet the payments of

interest and principal on foreign loans and foreign

obligations arising from financial or technical assistance

contracts.

d. Freedom from expropriation. The right to be free from

expropriation

by

the

Government

of

the

property

represented by investments or loans, or of the property

of the enterprise except for public use or in the interest

of national welfare or defense and upon payment of just

compensation.

In

such

cases,

foreign

investors

or

enterprises shall have the right to remit sums received as

compensation

for

the

expropriated

property in the

currency in which the investment was originally made

and at the exchange rate prevailing at the time of

remittance.

e. Requisition of investment. The right to be free from

requisition

of

the

property

represented

by

the

investment or of the property of the enterprises except

in case of war or national emergency and only for the

duration thereof. Just compensation shall be determined

and

paid

either

at

the

time

or

immediately

after

cessation of the state of war or national emergency.

Payments

received

as

compensation

for

the

requisitioned property may be remitted in the currency

in which the investments were originally made and at

the exchange rate prevailing at the time of remittance.

f. Confidentiality. Any confidential information supplied

by

the

contractor

pursuant

to

this

Act

and

its

implementing rules and regulations shall be treated as

such by the Department and the Government, and

during the term of the project to which it relates.

CHAPTER

XVII

Ground

for

Cancellation,

Revocation and Termination

Section 95

Late or Non-filing of Requirements

Failure of the permittee or contractor to comply with any

of

the

requirements provided in this Act or in its

implementing rules and regulations, without a valid

reason, shall be sufficient ground for the suspension of

any permit or agreement provided under this Act.

Section 96

Violation of the Terms and Conditions of Permits or

Agreements

Violation of the terms and conditions of the permits or

agreements shall be a sufficient ground for cancellation

of the same.

Section 97

Non-Payment of Taxes and Fees

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