Philippine Film and Television Tourism Act

... TWENTIETH CONGRESS OF THE ) JUL -3 ?6:15 REPUBLIC OF THE PHILIPPINES First Regular Session SENATE S. No. _ Introduced by Senator Manuel "Lito" M. Lapid AN ACT ESTABLISHING A FRAMEWORK FOR FILM AND TELEVISION TOURISM IN THE PHILIPPINES, CREATING AN INTER-AGENCY COMMITTEE ON FILM AND TELEVISION TOURISM AND FOR OTHER PURPOSES EXPLANATORY NOTE Film tourism is a steadily growing industry in the Philippines, owing to its undeniable and significant impact on boosting the tourism sector. It not only connects audiences to destinations featured in films— raising international awareness of these locales— but also encourages them to visit these scenic spots in person. This, in turn, generates employment opportunities and promotes Filipino values, culture, traditions, and heritage, making it a vital driver of national growth and development. According to industry experts, Asian travelers are among the world's most enthusiastic film tourists. With travel becoming more accessible and affordable, thanks to the rise of online booking platforms and low-cost carriers, it is expected that more consumers of film and television content will actively seek out film locations when planning their travels.1 ' Gatdula, Donabelle. ABS-CBN News. (5 March 2014). DOT Urged to Promote Film Tourism. Retrieved from: https://news.abs-cbn.com/business/03/04/14/dot-urged-promote-film- tourism-ph

The Philippines, like many countries, has served as the backdrop for several international films, including Apocalypse Now (1979), The Year of Living Dangerously (1982), Platoon (1986), Born on the Fourth of July (1989), The Bourne Legacy (2012), XXx: Return of Xander Cage (2017), and Avengers: Infinity War (2018). Locally produced films have also highlighted the natural beauty and cultural richness of various Philippine destinations. Notable examples include Hele sa Hiwagang Hapis (2016, Sorsogon), Flotsam (2015, La Union), You're My Boss (2015, Batanes), Batanes: Sa Dulo ng Walang Hanggan (2007), and Siquijor: Mystic Island (2007). Sagada, in particular, saw a remarkable increase in tourist arrivals after being featured in the 2015 film That Thing Called Tadhana-from 65,000 in 2014 to 138,257 in 2015, 85% of whom were from the lowlands, mainly Metro Manila. 2 The impact of film on our communities is multifaceted. Economically, film productions provide employment to local residents and revenue to nearby businesses. Once a film is released, it serves as a powerful promotional tool, turning its locations into popular tourist destinations. More importantly, it instills a sense of pride among local communities whose cultures and landscapes are portrayed on screen. It fosters a feeling of recognition, appreciation, and belonging, which strengthens the bond between the place and the audience. However, there must also be safeguards to protect against damage from production to locations, especially to the areas protected by law. Moreover, there must be a plan in place to ensure minimum disruption to normal activities of our communities. 2 Dalisay, Vee Jay. (14 January 2017). Emerging Forms of Tourism: Film Tourism. Retrieved from: https://www.academia.edu/31212537/Written_Report_on_Emerging_Forms_of_Tourism_Fil m_ Tourism

Hindi po natin matatawaran ang laki ng epekto ng pelikula sa ating mga Komunidad. Kaya po marapat lamang na lalo pa nating paigtingin ang ating mga programa upang ipakita sa ating mga pelikula ang iba't ibang lugar sa ating bansa. This proposed measure seeks to recognize film and television tourism as a special investment and a key tool for national development. It aims to enhance the country's tourism industry through strategic promotion of film tourism, encourage both local and foreign filmmakers to shoot in the Philippines, and showcase our rich culture and heritage-ultimately leading to greater employment, economic activity, and national pride. In view of this, early passage of this bill is sought. "LITO" M. LAPID Senator

;.: TWENTIETH CONGRESS OF THE ) JUL -3 75:15 First Regular Session SENATE S. No. _ Introduced by Senator Manuel "Lito" M. Lapid AN ACT ESTABLISHING A FRAMEWORK FOR FILM AND TELEVISION TOURISM IN THE PHILIPPINES, CREATING AN INTER-AGENCY COMMITTEE ON FILM AND TELEVISION TOURISM AND FOR OTHER PURPOSES Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

Section 1, Title. - This Act shall be known as the " Philippine Film and Television

Tourism Act."

Section 2. Declaration of Policy. - It is hereby declared to be the policy of the

8 State to treat film and television tourism as a special investment and tourism tool for national development. Consistent with the national goal of creating new areas of business to generate employment opportunities as well as to recognize Filipino talent and culture, film and television tourism in the country is hereby made a new investment priority, including but not limited to: making the Philippines a location for shooting or filming area; preserving or promoting the nation's historical and cultural heritage and resources as well as artistic creations or sceneries depicted in films, and converting it into tourist attractions; and championing Filipino film practitioners and artists and their participations in foreign productions.

Section 3. Creation of the Philippine Inter-Agency Committee on Film and

Television Tourism (PIAC-FTT). - The Philippine Inter-Agency Committee on Film and Television Tourism (PIAC-FTT) is hereby created, replacing the Philippine Film Export Service Office (PFESO) under the Film Development Council of the Philippines (FDCP), organized under Executive Order No. 674, Series of 2007. The PIAC-FTT shall be headed by an Executive Director, a position which shall be equivalent to an Executive Director III position of the FDCP and which shall be a career executive service officer position to be recommended by the Chairperson of the FDCP and appointed by the President. It shall be composed of representatives from the following agencies: 1. Department of Tourism; 2. Department of Trade and Industry; 3. Department of Interior and Local Government; 4. Department of Finance; 5. Department of Foreign Affairs; 6. Bureau of Immigration; and 7. Department of Labor and Employment. The heads of the above stated departments of government shall designate their regular representatives, based on their position in the organization, but not lower than a Director-level position. The said representatives of the various government agencies shall, in addition to their duties provided in this Act, also serve as the direct link to streamline and develop a one-stop-shop system. The Secretariat of the PIAC-FFT shall be based in the Film Development Council of the Philippines for financial and administrative support. It shall be composed of existing plantilla positions and new positions that the Department of Budget and

Management may create that shall be necessary for the effective implementation of this Act.

Section 4. Functions of PIAC-FTT. - The PIAC-FTT shall facilitate a one-stop-

shop system for foreign film or television production entities. It shall perform the following: 1. Facilitate the promotion and marketing of the Philippines as location site for the production of international films and television programs, such as but not limited to: creating and maintaining a website and/ or a manual of Philippine Film and Television Tourism sites for overseas contract workers; participating and exposure in World Expo, recognized international film festivals, activities for cinema and television with global market penetration, tourism fairs of international significance; 2. Formulate a ten-year Comprehensive Plan detailing an inventory of film tourism sites in the country, areas for improvement, sectors to be tapped, partnerships and marketing strategies both local and international in application; 3. Offer tax credits to productlons deemed eligible under this Act, which it shall issue no more than six months after the completion of principal photography; 4. Formulate and recommend a reward and incentive package for foreign film/television entities interested In shooting films/television programs in the country and monitor the implementation thereof; 5. Provide assistance to foreign film production entities in processing pertinent documents and various requirements relative to the production of international films/television programs in the country and in complying with environmental regulations; 6. Coordinate with various government agencies and local government units in assisting the entry and exit of a foreign film/television production team, such as but not limited to producers, artists and production crew;

7. Provide direct link between foreign production entities, producers, filmmakers and artists with local production manpower services, local artists, bit players and technical crew, facilities and the like; 8. Utilize the services of tourism attaches abroad, through the Department of Tourism, in the promotion and marketing of Philippine locations sites/resources and local film production manpower; 9. Maintain an inventory of areas in the country that may be utilized as a film and television tourism site and a registry of sectors including artists, film practitioners, technical personnel and others for ready referrals; 10. Identify key film and television tourism sites used by international or local filmmakers and establish a PIAC-FFT mark; 11. Establish the necessary guidelines to protect film and television production locations against damage related to and resulting from said productions. Such guidelines shall include, among others, providing for the necessary security for damages, and provision of necessary arrangements to minimize disruption and disturbance to local activities; 12. Establish the necessary guidelines to ensure that all areas protected by law are not negatively impacted by film and television productions; 13. Keep a progress report and actual impact of the initiative taking into consideration the increase in the number of film tourists and its contribution to the economy; 14. Conduct the feasibility of establishing a film and television museum; 15. Coordinate with various stakeholders and market players for research and study on feasibility of a reward and incentive system, and other aspects combining tourism and film, including, but not limited to the system of categories for the application of rewards and incentives depending on the cinema grade and length of exposure of the identified Philippine Film and Television Tourism site;

16. Coordinate with all embassies or consulates of the country to promote film and television tourism; 17. Coordinate and partner with various associations of Filipino overseas workers abroad in marketing, disseminating and propagating information on Philippines as a film tourism destination, and 18. Coordinate and partner with known Filipinos of international stature in promoting the country and fulfilling the implementation of this Act.

SECTION 5. Partnership with Local Government Units (LGUS) - The PIAC-FFT

shall partner and collaborate with Local Government Units in the performance of the following: 1. Identifying and promoting film and television tourism sites; 2. Facilitating and providing assistance in the easy issuance of permits, certificates and other documents related thereto; 3. Protection of local areas and residents against possible ill-effects related to film and television production; 4. Assisting in screening, providing, and identifying the necessary complementary manpower requirements before, during and after film and television production; and 5. Providing monetary and non-monetary incentives to the overall film production team as far as practicable.

SECTION 6. Amount of Tax Credit. -

a. The minimum tax credit awarded to eligible productions shall be equal to twenty percent (20%) of qualified expenses, as defined in Section 7 of this Act. b. In addition to the minimum tax credit, qualifying films, television shows, movies of the week, mini-series, and web-series may gain further credits under a point- based incentive system, to be administered by the PIAC-FFT. Each point shall

correspond with an additional one percent rebate on all qualifying expenses. Any production shall only be able to claim one rebate from the following subsections in their entirety: 1. Eligible productions may receive twenty (20) points if the final product is set completely or largely within the Philippines, fifteen (15) points if the final product contains ten (10) or more substantive scenes set within the Philippines, and ten (10) points if the final product contains at least five substantive scenes set within the Philippines; 2. Eligible productions may receive twenty (20) points if at least one-half of filming within the Philippines occurs within a community recovering from a significant natural disaster that occurred within the preceding three years or ten (10) points if at least one-fourth of filming within the Philippines occurs within the same areas; and 3. Eligible productions may receive two (2) points if they dedicate at least ten (10) seconds worth of screen time during the credit roll to a message acknowledging the films participation in the film tax credit program of the Philippines and providing the URL to a website where viewers can learn about tourism opportunities in the country. c. All qualifying international productions shall also receive the following tax credits. However, in no situation may the total tax credit amount received for any particular expense exceed forty percent (40%): 1. Twenty percent (25%) of the cost of construction of any permanent and useful infrastructure built in the Philippines for the purposes of filming, including likely tourist attractions, subject to approval of the Department of Tourism; 2. Fifteen percent (15%) of all lodging within the Philippines booked for production team members, for production-related purposes,

3. Ten percent (10%) of the cost of all transportation to or from the Philippines for production team members conducting either production-related travel or the transportation of filming equipment into the Philippines; 4. Five percent (5%) of the cost associated with the provision of utilities or technology purchased within the Philippines and the employment, as far as practicable, of local talents.

SECTION 7. Qualified Expenses. -

a. Qualified expenses for the purposes of determining the amount of a tax credit shall include any expense incurred within the Philippines directly related to pre- production, production, or post-production conducted within the Philippines, unless otherwise exempted. However, expenses must be reasonable and prices may not substantially exceed the market value of the procured product or service. Qualified expenses include, but are not limited to, expenses such as or related to: 1. Salary, wages, or other compensation such as per diem provided to members of the production team or subcontractors for any services rendered within the Philippines; 2. Creation, decoration, or operation of sets or shooting locations and production offices; 3. Filming equipment or supplies; 4. Locally sourced photography equipment or services; 5. Locally sourced editing equipment or services; 6. Locally sourced music; 7. Catering equipment or services;

8. Costumes, make-up, and similar products and services; 9. Lodging and domestic, or international travel; or 10. Insurance. The PFTTO shall reserve the right to disqualify any expenses that clearly do not 5 fall within the spirit of the tax credit program, subject to administrative and judicial appeal. b. As an assumption, the following shall not be recognized as qualified: 1. Those related to distribution of the film, including but not limited to marketing and promotion; 2. Such as attorney or accounting fees, incurred in the process or as a result of acquiring or challenging a government determination of eligibility for incentives later reimbursed to the production; 3. Items that are later resold by the production, minus any loss incurred; 4. Any amounts paid to members of the production as a result of profit participation, residual, or similar agreements; and 5. Expenses associated with the financing of production.

Section 8. Tax Incentives Eligibility. - The following requirements must be

attained to be eligible for the incentives program: a. Upon certification by PIAC-FFT that the production is a professional endeavor and has met the PIAC-FFT's requirements in terms of the amount of investment and the amount of jobs the production will generate; b. Participating productions must agree to cooperate with any audits conducted to ensure compliance with program eligibility requirements, both during and after production;

Section 9. Offer Preferential Incentives. - International or foreign film and

television production entities may, upon certification from the PIAC-FFT, be granted the following: 1. Multiple Entry Visa. - Foreign nationals who are members of the international film production entities, as duly endorsed by the PFTTO, shall be issued a multiple entry special visa within seventy-two (72) hours upon submission of all required documents, and which shall be valid for a period of one (1) year to enter the Philippines: Provided, That a responsible officer of the applicant entity submits a duly authenticated certificate to the effect that the person who seeks entry into the Philippines is a member of the applicant entity and will work exclusively for film and television production. The admission and stay shall be coterminous with the validity of the multiple entry special visa. The stay, however, is extendible for one hundred eighty (180) days upon submission to the Bureau of Immigration of a sworn certification by a responsible officer of the applicant entity, that its permit remains valid and subsisting, and that no other source of income has been made. 2. Tax- and Duty-Free Importation. - The international or foreign film or television production entity shall enjoy tax- and duty-free importation of filming equipment as determined and endorsed by the PIAC-FFT.

Section 10. Implementing Rules and Regulations. - The Film Development

Council, Department of Tourism, Department of Finance and the Bureau of Immigration shall promulgate and issue the implementing rules and regulations within ninety (90) days upon approval of this Act.

Section 11. Appropriations. - The amount necessary to implement the

provision of this Act shall be included in the Annual General Appropriations Act.

Section 12. Separability Clause. - In the event that any provision or part of

this Act shall be declared unconstitutional, the remaining provisions shall remain valid and in full force and effect.

Section 13. Repealing Clause. - Executive Order No. 674, Series of 2007, is

hereby amended. All laws, decrees, executive orders, issuances, rules and regulations, or parts thereof not consistent with the provisions of this Act are hereby repealed or modified accordingly.

Section 14. Effectivity. - This Act shall take effect fifteen (15) days after its

complete publication in the Official Gazette or in at least two (2) newspapers of general circulation, whichever comes earlier. Approved,