Closing a PEZA registered Company

PEZA Closures in the Philippines – Cancellation of PEZA Registration

After company registration with PEZA, sometimes it is inevitable that these companies with registered activities with PEZA close shop. The saying goes that it is easier to create or form a company but it is harder to close a company is true. This is because all the various government entities for which the company was registered, including PEZA, will have to be notified of such closure and certain requirements must first be complied with before that particular government agency clears the company that would like to close.

Delisting of Registered Activity – Temporary Closure of Operations

Unfortunately, for a PEZA registered entity the list to close or delist a registered activity is long. These are:

1. Letter request stating reason/s effectivity date

2. Total No. of affected workers and status of all product line indicating the following: – Total No. of workers per products line- Total No. of administrative personnel – product line affected; what will happened to the workers assigned in this specific product line

3. Certified list of machinery/equipment, raw materials, properties and other inventory to be disposed of, indicating its total book value.

4. Notarized undertaking signed by the highest responsible official stating that: – all terminated/affected workers/employees will be paid of all monies due them

5. Copy of Board Resolution declaring the cancellation of operations and its authorized representative to handle the disposition of all properties

6. Copy of notice to all affected employees/workers before the effectivity date of cancellation/delisting or temporary closure of operation

7. Copy of notice to Dole on cancellation/closure of operation indicating the date DOLE received such notice.

8. Certificate from DOLE, NLRC, NCMB stating that the company has no pending case(s) filed by its workers

9. Clearance from SSS stating that the company is up-to-date in remittingpremiums of its employees.

10. Clearance from the Zone Administrator/Zone Manager regarding (a)accounts/liabilities; (b) its waste materials/garbage used in company’s operations if these have been properly disposed of from the zone ©restoration/repair of any damage in the SFB/lot space

11. Copy of latest audited financial statement and updated quarterly reporton operations

12. BIR tax certification of no tax liabilities

The requirements are not easily met because it can happen that for particular a requirement to be accomplished, a sub-requirement may be included, this applies in notices to DOLE, NLRC, and SSS.

Further, it is highly recommended that the income tax holiday (ITH) validation has been secured by the PEZA registered entity prior to its closure. This is to ensure that the benefits secured by the company while in operations are due and appropriate as the PEZA registered company must show that it has complied with its registration agreement it executed with PEZA when it availed of the PEZA benefits while it has been in operations.