THE Senate unanimously passed the bill on Wednesday updating the Retail Liberalization Act of 2000, lowering the paid-up capital requirement for foreign retail businesses.
With 20 affirmative votes, no objections and no abstentions, the Senate approved at second and third reading in a single sitting the Senate Bill 1840 amending the Retail Trade Liberalization Act 2000 (RA 8762).
Senate approval paves the way for the bill’s early passage, as the House has already passed its version, gradually approaching submission to MalacaÃ±ang for signature by President Duterte. Second and third reading approvals were made possible by Duterte’s earlier decision to certify the bill as urgent.
The Senate Bill 1840 reduces the $ 2.5 million paid-up capital investment required for foreigners setting up retail businesses, such as convenience stores, to $ 1 million or Â£ 50 million.
In the original proposal, the amount was set at $ 300,000, but Pro Tempore Senate Speaker Ralph Recto proposed to change the amount, claiming it was too low and would allow large foreign retailers to easily beat the men of local affairs. As the retail liberalization bill was certified by MalacaÃ±ang as an urgent measure, it was included in the list of priority laws passed by the Senate on its priority agenda.
Previously, Senator Risa Hontiveros had warned against removing restrictions to expand foreign ownership of domestic retail, saying it was “not the wisest option” amid the economic crisis.
She expressed concern that the proposed amendments to the Retail Liberalization Act, which senators continued to deliberate on, “will only disadvantage” Filipino owners of mom-and-pop stores, sari stores. sari, carinderias and even public market stalls. , which effectively makes them âsecond-class citizensâ.
“They [Filipino traders] will become second-class citizens in our own sector of activity if the law on retail trade is amended, âlamented the legislator. Hontiveros added: âAt the moment, this is not our wisest option. Instead of our businessmen and our salespeople being able to recover, they will rather be affected by it. “
She cited key provisions of the 1840 Senate Bill proposing to “remove all capital restrictions on foreign retail ownership” by amending the Retail Liberalization Act (RTLA) of 2000.
Further, the senator added that while the proposed RTLA of 2000 still imposes a minimum capital requirement of $ 2.5 million on foreign ownership of 100 percent of retail businesses in the country, a requirement smaller ($ 250,000) is taxed on 100 percent foreign ownership for luxury goods retailers.
Stressing that it is not against foreign investment, Hontiveros noted, however, that the Philippine Retailers Association has expressed concerns that once the minimum capital requirement for foreign investors is lowered, “it will defeat Local MSMEs, “adding that” these amendments will not help Filipinos.
Hontiveros added: âMore than ever the wholesale and retail sector should now feel the support of the government. That’s why we keep asking for more ayuda and support for them, like wage subsidies and soft loans. “
The senator stressed that “we must listen to and support our MSMEs, who keep the country afloat as they are one of the hardest hit by the economic downturn.”