FIRB allows temporary WFH for ecozone firms

The Fiscal Incentives Review Board has approved the immediate and temporary implementation of work-from-home arrangements for registered business enterprises in economic zones and freeport areas, as the country remains under a state of national energy emergency. The policy is meant to help firms sustain day-to-day operations without disrupting their fiscal and nonfiscal incentives.

The FIRB announcement was published on April 10, 2026. Based on the release, the measure was framed as part of the government’s effort to keep investors competitive while limiting operational disruptions linked to the energy situation.

“We are extending full support to our investors as we navigate through this energy emergency, so they can remain competitive and keep their operations running smoothly. In line with our promise in the CREATE MORE Act, we are prepared to provide a responsive incentives regime that not only safeguards workers, but supports investors and their businesses,” FIRB Chairperson Frederick D. Go said.

The temporary arrangement further operationalizes the investor-responsive provisions of Republic Act No. 12066, or the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy, better known as the CREATE MORE Act, which amended the National Internal Revenue Code provisions on investment incentives.

Under the FIRB release, Rule 24, Section 3 of the CREATE MORE Act’s implementing rules and regulations allows all RBEs affected by exceptional circumstances to adopt temporary measures that are reasonable and support their recovery. The CREATE MORE law itself took effect after its publication in November 2024 and serves as the legal basis for updated incentive administration for investment projects.

The temporary WFH measure followed President Ferdinand Marcos Jr.’s declaration of a state of national energy emergency through Executive Order No. 110, s. 2026, dated March 24, 2026, in response to the ongoing conflict in the Middle East and its impact on energy security and domestic operations.

According to the FIRB release, coordinated action by the Board led to the issuance of FIRB Resolution No. 005-2026 on April 10, 2026, authorizing investment promotion agencies to allow up to 90% temporary WFH arrangements for RBEs with registered projects or activities.

Under the resolution, RBEs may place up to 90% of their total workforce on WFH arrangements, referring specifically to employees engaged in the registered project or activity of an RBE.

At the same time, the concerned investment promotion agency may impose a lower threshold of not less than 50% of the total workforce, depending on the circumstances and the nature of the RBE’s operations.

The FIRB said the arrangement is designed to balance business flexibility with accountability in the administration of tax incentives.

Under the rules, an RBE that fails to comply with the threshold imposed by its IPA will be penalized.

The penalty will require the RBE to pay the regular income tax multiplied by the amount by which the threshold is exceeded.

The excess, the FIRB said, will be calculated as the average of all excesses incurred during the month of noncompliance.

RBEs implementing temporary WFH arrangements must notify their concerned IPA and submit the required asset inventory, surety bond and related reports.

They must also provide monthly updates on assets brought outside the zones.

The concerned IPA is tasked to monitor compliance and impose penalties in cases of noncompliance.

The movement of tax- and duty-free imported assets outside economic or freeport zones will require prior IPA approval and the posting of a surety bond to ensure proper accounting and protect government revenues.

The FIRB also said the concerned IPA may adopt additional measures to ensure compliance with the conditions imposed on RBEs.

Those additional measures must in turn be reported to the FIRB for monitoring and evaluation purposes.

The resolution also requires RBEs to maintain prescribed export revenues and prohibits them from reducing their current number of employees, regardless of the authorized ratio or extent of WFH arrangements.

The temporary measure took effect on March 24, 2026, and will remain in force for one year, unless Executive Order No. 110, s. 2026 is extended or lifted earlier by the President.

“Through this temporary measure, we are striking the right balance between flexibility and accountability, ensuring that businesses can continue operating safely and efficiently while upholding fiscal discipline and protecting government revenues,” Secretary Frederick Go said.

The FIRB said the full text of Resolution No. 005-2026 is available on its website, where related advisories and implementing materials on CREATE MORE are also posted.

The move also revives a policy tool previously used for investment-registered firms during earlier disruptions, but this time ties the temporary WFH authority directly to the exceptional-circumstances provision under the CREATE MORE framework and the current energy emergency.

For ecozone and freeport locators, the measure offers temporary operational relief while preserving the conditions attached to government incentives, a balance the FIRB says is necessary as businesses navigate energy-related uncertainty and the government seeks to protect revenues at the same time.