CIB.O calls for government help to address sector woes

CEBU, Philippines — Cebu IT BPM Organization (CIB.O) has formally aired its petition to the government to promptly address several challenges that could stunt the growth of the Cebu outsourcing sector.

In a letter addressed to Department of Trade and Industry (DTI) secretary Alfredo E. Pascual, CIB.O requested help from the agency in bringing together concerned government agencies such as Philippine Economic Zone Authority (PEZA), Board of Investments (BOI) and Bureau of Customs (BOC) to join in the planned online forum to discuss the fine details how to address issues which are unique only for Cebu players.

“We intend to organize an online forum with concerned agencies to discuss the fine details that will allow the ‘seamless PEZA-BOI transition process as advocated by your office.

We hope that your office could help us get an audience with concerned agencies and facilitate a major forum relative to this concern. Our office will coordinate with your staff soon so we could sort this out,” CIB.O informed Pascual in the letter.

According to CIB.O, the recent pronouncements by government organizations on the IT-BPM industry’s transition from PEZA to BOI is one major concerns that everyone is dealing with. “It seems that what is happening is totally opposite from pronouncements that the transition will be ‘smooth and seamless”.

CIB.O mentioned that the processes after the (government) transition brought about a lot of challenges to the local industry.

CIB.O, which serves as mouthpiece of the outsourcing sector in Cebu noted that one major hurdle is in the area of “importations”, explaining that the new process will take more time and would be more costly for registered business enterprises (RBEs).

To take advantage of similar tax incentives for shipments, RBEs will need to file a tax exempt indorsement (TEI) for every shipment at DOF-Revenue in Manila, “and by the time they issue that, the shipment/transfer of goods to Cebu are already tagged as ‘abandoned’ by the Bureau of Customs. Hence, RBEs will have to pay additional fees again.

“Between PEZA/BOI and BOC, they are confused on what process to follow.”

RBEs are crossing from one office to another, and ironically they have a different understanding and interpretation of the processes. Primarily, the left hand, disagrees with the right hand on how things should be done.

“While that confusion among concerned agencies are ongoing, and authorities are still in the dark as to how this should be dealt accordingly, the shipments of concerned RBE’s are on hold and incurring daily penalties. This is a major problem for the industry now as companies are a bit worried without crystal clear guidelines and procedures as the compliance process entails a lot of extra work and expenses,” CIB.O letter indicated.