DEPARTMENT OF LABOR AND EMPLOY! ad Intramuros, Manila DEPARTMENT ORDER NO. __]g6} e=-=ve0" Series of 2017 4 IMPLEMENTING RULES AND REGULATIONS OF REPUBLIC ACT NO. 10774 Pursuant to Section 9 of Republic Act No. 10771, entitled “An Act Promoting the Creation of Green Jobs, Granting Incentives and Appropriating Funds Therefor’, otherwise known as the “Philippine Green Jobs Act of 2016’, the following rules and regulations are hereby issued: RULE I. PRELIMINARY PROVISIONS Section 1. Title. These rules and regulations shall be known as the “Implementing Rules and Regulations of the Philippine Green Jobs Act of 2016" or the "Rules’. Section 2. Policy. It is the declared policy of the State to: (a) Affirm labor as a primary social economic force in promoting sustainable development; (b) Afford full protection to labor, local and overseas, organized and unorganized; (c) Promote full and productive employment and equality of employment opportunities for all; and (d) Promote the rights of the people to a balanced and healthful ecology in accord with the rhythm and harmony of nature. The State shall identify needed skills, develop training programs, and train and certify workers for jobs in a range of industries that produce goods and render services for the benefit of the environment, conserve natural resources for the future generation, and ensure the sustainable development of the country and its transition into a green economy. In recognition of the participation of individuals and business enterprises in jobs creation, the State shall provide incentives therefor. ‘The promotion of a green economy shall pursue a just transition for all, job security for workers affected by the transition process which drives economic prosperity, decent job creation, sustainable and resilient livelihoods and communities, poverty reduction and social justice, anchored on social dialogue and tripartism at all levels. Section 3. Definition of Terms. As used in this Rules, the following terms shall mean: (2) Business enterprises refer to establishments engaged in the production, manufacturing, processing, repacking, assembly, or sale of goods and/or services, including service-oriented enterprises. They shall include (1) self-employed or own- account workers; (2) micro, small and medium enterprises (MSMEs); and (3) community-based business enterprises and cooperatives: (b) Climate change refers to a change in climate that can be identified by changes in the mean or variability of its properties and that persists for an extended period typically decades or longer, whether due to natural variability or as a result of human activity; (c) Green building practices refer to the adoption of measures that promote resource management efficiency and site sustainability while minimizing the negative impact of buildings on human health and the environment; Page 1 of §(d) Green economy refers to one which is low-carbon and resource-efficient, and results in the generation of green jobs and in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities; (e) Green goods and services refer to goods and services that benefit the environment or conserve natural resources, and may include research and development, installation and maintenance services; (f) Green jobs refer to employment that contributes to preserving or restoring the quality of the environment, be it in the agriculture, industry or services sector. Specifically, but not exclusively, this includes jobs that help to protect ecosystems and biodiversity, reduce energy, materials and water consumption through high efficiency strategies, de- carbonize the economy, and minimize or altogether avoid generation of all forms of waste and pollution. Green jobs are decent jobs that are produetive, respect the rights of workers, deliver a fair income, provide security in the workplace and social protection for families, and promote social dialogue; (g) Green technologies refer to the development and application of products, equipment and systems used to conserve the environment and natural resources; and (h) Sustainable development refers to development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs. Section 4. Acronyms. As used in this Rules, the following acronyms shall refer to: (a) BOC - Bureau of Customs (b) BIR - Bureau of Internal Revenue (c) BSP - Bangko Sentral ng Pilipinas (d) CCC - Climate Change Commission (e) CHED - Commission on Higher Education () DA- Department of Agriculture (g) DepEd - Department of Education (h) DOE - Department of Energy (i) DENR - Department of Environment and Natural Resources (). DOF - Department of Finance {k) DILG - Department of the Interior and Local Government () DOLE - Department of Labor and Employment (m)DPWH - Department of Public Works and Highways (n) DOST - Department of Science and Technology (0) DOT - Department of Tourism (p) DTI - Department of Trade and Industry (q) DOTr - Department of Transportation (1) GFI- Government Financial Institution (s) NEDA - National Economic and Development Authority (t) PSA - Philippine Statistics Authority (u) PRC - Professional Regulation Commission (v) TESDA - Technical Education and Skills Development Authority RULE II. COVERAGE This Rules shall apply to all business enterprises, as defined herein, which includes (1) self= employed or own-account workers; (2) micro, small and medium enterprises (MSMEs); and (3) community-based business enterprises and cooperatives. Page 2 of 5RULE Ill. INCENTIVES AND ASSISTANCE PROGRAM Section 1. Incentives. Incentives under this Rules shall be provided to qualified business enterprises to encourage them to generate and sustain green jobs. Section 2. Forms of Incentives. Qualified business enterprises shall be entitled to the following incentives, in addition to fiscal and non-fiscal incentives already granted or provided under existing laws, orders, issuances and regulations: (a) Tax Deduction. A special deduction from the taxable income equivalent to fifty percent (50%) of the total expense for skills training and research development expenses will be provided to business enterprises. Such special deductions shall be over and above the allowable ordinary and necessary business deductions for said expenses under the National Internal Revenue Code of 1997, as amended. (b) Exempt Importation of Capital Equipment. No custom duties and taxes shall be imposed on the importation of capital equipment provided such equipment shall be actually, directly and exclusively used in promoting, generating, and sustaining green jobs of the qualified business enterprise. Section 3. Eligibility. In order to be qualified to avail of the tax incentives under this Rules, the ‘Secretary of the CCC or his duly authorized representative shall duly certify business enterprises with green jobs content as assessed by appropriate government agency pursuant to Rule 4 of this Rules. Section 4. Administration of Incentives. The DOF, through the BIR and BOC, shall administer the grant of incentives to qualified business enterprises as provided in this Rules. The CCC shall ‘submit to the DOF data on the certified business enterprises, including those that were not certified. Section 5. Period to Grant Incentives. The fiscal incentives granted under the Act and other relevant laws shall apply to all qualified business enterprises from the effectivity of this Rules. Section 6. Business Development Support. The DOST shall provide a range of business development support to MSMEs and other business enterprises. This may include prototyping or modelling of technologies, conducting assessment to match technological needs and demands, ‘subcontracting business to develop clean technologies, and providing technical written guides, procedures as well as instructions and training on clean technology for business. Section 7. Special Business Facilitation Program. The DTI, through the Negosyo Centers shall develop a special business facilitation program for individuals and business enterprises that create green jobs. Such program shall be based on the Human Resource Development Plan or other plans and programs of the government that promote the development of green goods and services or creation of green jobs. Section 8. Financial Assistance Program. Any provision in their respective charters to the contrary notwithstanding, GFis shall, in consultation with the BSP, provide preferential financial packages to business enterprises that create green jobs. RULE IV. ASSESSMENT AND CERTIFICATION Section 1. Standards. Business enterprises may avail of the incentives subject to the standards for the assessment and certification of green goods and services, and green technologies and practices. The CCC, in consultation with concemed agencies such as the DTI, DOST, DENR, DOLE, DA, DOE and DILG, shall develop the standards for assessment within one hundred twenty (120) days after the effectivity of this Rules. Page 3 of 5