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From National Government Portal – Edited at the Office of the President of the Philippines Under Commonwealth Act No. 63

E!ec"tive Order No. # $% s. $'MALACAÑAN PALACE

MANILA

() *+E P,E- /EN* OF *+E P+ 0 PP NE-

E1ECU* 2E O,/E, NO. # $

P,O2 / NG FO, A CO P,E+EN- 2E AU*O O* 2E ,E-U,GENCE -*,A*EG)P,OG,A

4+E,EA-% Articles II and XII of the 1987 Constitution of the Philippines recogni e theindispensa!le role of the pri"ate sector in encouraging pri"ate enterprise# pro"iding incenti"es toneeded in"est$ents# and pro$oting industriali ation and full e$plo%$ent&

4+E,EA-% Articles ' and 7 of E(ecuti"e )rder *E)+ No, ''- *s, 1987+ or the .)$ni!usIn"est$ents Code of 1987#/ as a$ended# declare that the 0tate shall encourage pri"ate ilipinoand foreign in"est$ents in industr% 2hich shall pro"ide significant e$plo%$ent opportunities# pro"ide a foundation for the future de"elop$ent of the econo$%# and $eet the tests of international co$petiti"eness and e$po2er the 3oard of In"est$ents *3)I+ to for$ulate andi$ple$ent rationali ation progra$s for certain industries to address i$pedi$ents to econo$icgro2th# and for$ulate guidelines for progressi"e $anufacturing progra$s&

4+E,EA-% E) Nos, 14- *s, '55'+ and 8776A *s, '515+ pro"ide for a co$prehensi"e industrial polic% and directions for the Motor ehicle e"elop$ent Progra$ to accelerate the soundde"elop$ent of the Philippine Motor ehicle Industr%# recogni ing the need to attainco$petiti"eness in the A0EAN region in particular&

4+E,EA-% there is a need to aug$ent and enhance polic% and directions of e(isting $otor "ehicle de"elop$ent progra$s to2ards ensuring a resurgent auto$oti"e industr% that supportsinno"ation# technolog% transfer# en"iron$ental protection# and 0$all and Mediu$ Enterprises*0MEs+ de"elop$ent&

4+E,EA-% there is a need to ena!le the countr% s auto$oti"e industr% to sei e $ar:etopportunities opened !% the A0EAN Econo$ic Co$$unit% and deepen its participation in theregional suppl% chain& and

4+E,EA-% the i$pro"e$ent of the auto$oti"e industr% 2ill !oost $anufacturing capa!ilit% of the o"erall industrial sector# spur gro2th of 0MEs and create $ore ;o!s in the countr%,

NO4% *+E,EFO,E % (EN GNO -. A5U NO % President of the

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-EC* ON #. Comprehensive A"tomotive ,es"r ence -trate 7 Pro ram. >heCo$prehensi"e Auto$oti"e he CA

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g, Model Life refers to the %ears upon 2hich there are no $a;or changes in the o"er6alldesign and appearance of a Model,

h, Name late refers to the na$e used !% the car $a:er in $ar:eting a $odel# including its"ariants# in the Philippines,

i, Parts refer to the 3od% 0hell Asse$!l% and Large Plastic Parts Asse$!lies of the Model#as 2ell as the Co$$on and 0trategic Parts,

;, Planned total roduction !olume refers to the $odel life production "olu$e up to a$a(i$u$ of si( *-+ %ears as su!$itted !% the applicant,

:, Segment "eighted A!erage Price refer to the 2eighted a"erage Net Manufacturer s Pricefor the "ehicle seg$ent of an enrolled Model less the esti$ated $anufacturer s net profitof fi"e percent *4 +,

l, Standard Production Su ort refers to the @uotient of si(t% percent of the Model Life3udget o"er the difference !et2een the planned Model Life production "olu$e and onehundred thousand, Model Life in this case shall not e(ceed si( *-+ %ears,

$, Strategic Parts refer to auto$oti"e "ehicle parts specific to an enrolled Model notcurrentl% produced in the Philippines at )EM standards such as# !ut not li$ited to# strutsand shoc: a!sor!ers# plastic fuel tan:s# head la$ps# rear co$!ination la$ps# steeringasse$!l%# and alu$inu$ radiators,

-EC* ON 8. F"nctions of the (O . >he 3)I# as the lead i$ple$enting and coordinatingagenc% of the CA

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a, epart$ent of inance * ) +&

!, epart$ent of >ransportation and Co$$unication&

c, epart$ent of 0cience and >echnolog%&

d, National Econo$ic and e"elop$ent Authorit%&

e, >echnical Education and 0:ills e"elop$ent Authorit%&

f, >he Co6Chair$an of the Industr% e"elop$ent Council& and

g, >he Co6Chair$an of the National Co$petiti"eness Council,

>he 3)I shall also act as the 0ecretariat of the Inter6Agenc% Co$$ittee,

-EC* ON 6. F"nctions of the nter9A enc7 Committee. >he Inter6agenc% Co$$ittee shall perfor$ the follo2ing functions=

a, E"aluate applications for enroll$ent of Models under the CA

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a, >rac: record and Model co$petiti"eness&

!, Ne2 in"est$ents in 3od% 0hell Asse$!l% and Large Plastic Parts Asse$!lies&

c, Planned "olu$e# as $a% !e deter$ined !% 3)I# !ut in no case lo2er than t2o hundred

thousand *'55#555+ "ehicles o"er the Model Life up to a $a(i$u$ of - %ears&d, Econo$ic i$pact of the in"est$ent plan for the Model# including i$pact on the parts

$anufacturing industr% and lin:ages# ;o!s generation# and o"erall consu$er 2elfare&

e, )"erall co$petiti"e en"iron$ent and long6ter$ industr% de"elop$ent& and

f, Co$pliance 2ith fuel efficienc% and e$ission le"el standards as $a% !e deter$ined !%3)I# 2hich in no case shall !e lo2er than the standards under the Clean Air Act,

-EC* ON . Eli i;ilit7 and 5"alifications of Participants. >he participating Car Ma:ers#

Parts Ma:ers and 0hared >esting acilit% Proponent $ust $eet the follo2ing @ualifications# andsuch other criteria as $a% !e re@uired !% 3)I=

Minimum #ualifications for Car Ma$ers

a, An internationall%6recogni ed Car Ma:er !rand o2ner and or its authori ed in countr%licensed $anufacturer acting ;ointl% 2ith an internationall%6recogni ed car$a:er !rando2ner&

!, Pro"en glo!al trac: record& and

c, E(isting $ultinational operations, Minimum #ualifications for Parts Ma$ers

a, Endorsed !% the PCM to $anufacture parts of its enrolled Model&

!, )EM auto$oti"e Parts Ma:er and or its authori ed in6countr% licensed $anufactureracting ;ointl% 2ith an internationall%6recogni ed car$a:er !rand o2ner&

c, Pro"en trac: record& and

d, A $e$!er of good standing of the Philippine Parts Ma:er Association, Minimum #ualifications for the Shared %esting Facility Pro onent

a, Collecti"el% endorsed !% the PCMs& and

!, Pro"en trac: record,

-EC* ON he 3)I shall esta!lish the application andselection process for Model enroll$ent and the @ualif%ing progra$ for Participants# i$posing

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such ter$s and conditions as it $a% dee$ necessar% to pro$ote the o!;ecti"es of the CAhe 3)I shall prescri!e an application period during 2hich a PCM can appl% for the enroll$entof onl% one *1+ Model, Bo2e"er# if the three *?+ Models are not full% su!scri!ed 2ithin the said

period# the 3)I can set a ne2 application period for enroll$ent of additional Model*s+# in 2hichcase# $ore than one *1+ Model $a% !e granted to a PCM,

Dpon appro"al# the 3)I shall issue a Certificate of he registered PCM shall !edee$ed a $e$!er under the Motor ehicle e"elop$ent Progra$,

-EC* ON #&. Fiscal -"pport. >he registered Participants $a% !e entitled to t2o *'+ :inds of fiscal support during the enrolled Model Life# up to a $a(i$u$ of si( *-+ %ears# na$el%= *1+

i(ed In"est$ent 0upport * I0+& and *'+ Production olu$e Incenti"e *P I+& Pro"ided# that theParticipants satisf% the follo2ing @ualifications=

Criteria to be Eligible to FIS

a, Ne2 in"est$ents in the $anufacture of Parts and or esta!lish$ent of 0hared >estingacilit%&

!, eli"er% of Parts to the PCM 2ithin the prescri!ed period as stipulated !% the 3)I&

c, Introduction of the enrolled Model to the $ar:et using the Parts $anufactured under thisCA

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-EC* ON ##. Esta;lishment of the A"tomotive /evelopment F"nd in the GeneralAppropriations Act. >he epart$ent of 3udget and Manage$ent * 3M+# in coordination 2iththe 3)I# shall propose# through the National E(penditure Progra$# the inclusion of anAuto$oti"e e"elop$ent und *A + in the annual Feneral Appropriations Act *FAA+# to fundthe fiscal support to !e granted to registered and eligi!le Participants,

>he total fiscal support for the CAhe fiscal support for the registered and eligi!le

Participants shall !e e"idenced !% a non6transferra!le >a( Pa%$ent Certificate *>PC+6as pro"ided !% la2, >his shall !e used to defra% the ta( and dut% o!ligations of the Participants tothe National Fo"ern$ent# specificall%# e(cise ta(# inco$e ta(# i$port duties# and alue Added>a( * A>+,

>o2ards this end# the 3)I# 3M# and ) shall draft an efficient and effecti"e >PC$echanis$,

-EC* ON #8. No /o";le Availment of ncentives.

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!, eli"er% of Parts to the PCM 2ithin the prescri!ed period,

>he 3oard $a% li$it a"ail$ent of support as it $a% dee$ necessar%, urther# failure to co$pl%2ith an% of the pro"isions of this E(ecuti"e )rder# its I$ple$enting 2o >housand andifteen,

*0gd,+(EN GNO -. A5U NO

3% the President=

*0gd,+PA5U *O N. OC+OA% =,.

Executi!e Secretary