Tariffs: Items which are not locally produced generally have low tariffs meaning it is zero to five percent, while locally produced intermediate products and raw materials are given the assessed duties of three to ten percent. Locally produced goods that competes with finished products face higher tariffs of fifteen to thirty percent. Finished products that compete with locally produced goods face higher tariffs of fifteen to thirty percent. On January 03, 2001, a tariff schedule was issued particularly the Executive Order 334 which states that in 2002 and 2003 the tariffs will gradually reduced to meet a uniform of five percent tariff rate for all products by January 2004. Though there are exemptions to this plan and it contains some raw materials that would face a three percent rate for 2004, as well as finished motor vehicles and some agricultural goods.
Import licenses: A government entity which is the national Food Authority (NFA) is the only authorized importer of rice and continues to be involved in imports of corn. An administrative order entitled Fisheries Administrative Order (FAO) 195, series of 1999 issued by the Department of Agriculture, requires a license to import fresh, chilled, and frozen fish when it is intended for sale in local retail markets.
Other certain items such as firearms, and ammunition, used clothing, sodium cyanide, chlorofluorocarbon (CFC) and other ozone-depleting substances, penicillin and derivatives, coal pesticides, used motor vehicles, and used tires are subject to other import regulations. Certain agricultural commodities are subject to minimum access volume of tariff-rate quotas.
Excise tax: The discriminatory aspects of the Philippines’ excise tax system have raised the concerns of U.S. producers of automobiles and distilled spirits. Products made from materials that are very much available excise taxes on distilled spirits impose a lower tax on products made from materials that are very much available (e.g., coconut, palm, sugar cane). Automobile vehicles’ excise tax treatments are based on engine displacement, rather than vehicle value.
Standards, Testing, Labeling and Certification: The importation of products covered by mandatory Philippine national standards must be cleared by the Bureau of Product Standards (BPS). Requirements for labeling in the Philippines apply to different types of products; this includes pharmaceuticals, food, textiles and certain industrial goods. The generic name of a pharmaceutical product should appear above its brand name on all packaging as mandated by the Generics Act of 1998.
Incentives and Export Requirements: To engage in a pioneer activity to qualify for incentives administered by the government’s Board of Investment (BOI), foreign owned firms should produce for the domestic market. The BOI imposes a higher export performance requirement for foreign-owned enterprises for exporters, which are 70 percent of production, should be exported, while Philippine-controlled companies only 50 percent. Although, there is an exception of foreign-controlled firms that export 100 percent of production, who seek incentives from the BOI must commit to divest 40 percent ownership within 30 years or such longer period that the BOI may allow.
Government Procurement Practices: Philippine controlled firms should service locally-funded government consulting requirements as a general rule. The Philippines is not a signatory of the WTO Government Procurement Agreement.
Customs Procedures: In Bureau of Customs (BOC), all importers of their agents must file import entries that will then process these entries with the use of the Automated Customs Operating System (ACOS). A computer system is used by the ACOS to classify shipments at low-risk or the (green lane), moderate risk is (yellow lane) or of high risk (red lane). Shipments that are channeled through the yellow lane require a documentary review, while red lane shipments will require a physical inspection at the port. According to the BOC it is not subject to any documentary or inspection requirements as for the green lane.
Export Subsidies Policies: Firms engaging in activities under the government’s “Investment Priorities Plan” may register with the Board of Investments for fiscal incentives. This is composed of three to six year income tax holidays and a tax deduction equivalent to 50 percent of the wages of direct-hire workers for the first five years from the time of registration. Firms in less developed areas may be eligible to claim a tax deduction of up to 100 percent of outlays for infrastructure works and 100 percent of incremental labor expenses also for the first five years of registration. For export-oriented firms that are developed in government-designated export zones and industrial estates which are registered with the Philippine Economic Zone Authority have the same incentives as BOI-registered firms. This includes a longer income tax holiday of four years up to an extendable maximum of eight years.
A five percent tax on gross income in lieu of all national and local taxes will be applied after the Income Tax Holiday period. Firms that earn at least 50 percent of their revenues from their exports may register for certain tax credits under the “Export Development Act”, including a tax credit based on incremental export revenues.
Worker Rights: Private and public employees have the right to form and join labor unions. The aspects of the public sector organization law restrict and discourage organizing, even if this right is exercised and practiced.
Korea's rebound from the 1997 crisis bolsters a surge of foreign investment and results global confidence. Lesser items are subject to tariffs in a continued loosening of import restrictions. Except on national security or cultural industries Korea liberalizes foreign investment regulations for all sectors. The global slowdown of 2001-02 causes fears, as does increased tension with North Korea.