Metro Manila May Welcome New PEZA Zones Again: What Businesses Should Know

A new PEZA economic zone in Metro Manila may soon become a reality.

According to BusinessWorld, the Philippine Department of Trade and Industry (DTI) has confirmed that it will recommend to the Office of the President the lifting of Administrative Order №18 (AO18), a policy implemented in 2019 that suspended the approval of new Philippine Economic Zone Authority (PEZA) economic zones within Metro Manila.

PEZA Director General Tereso Panga. Image Source: Official PEZA Website

PEZA Director General Tereso Panga said that both the Department of Finance (DOF) and the DTI support the proposal, and PEZA has been authorized to formally submit the recommendation to Malacañang.

Several office buildings in Makati and Arca South in Taguig are currently awaiting PEZA accreditation. If the proposal is approved, these developments could once again become available to qualified investment projects seeking PEZA incentives.

While the policy has not yet been officially amended, businesses planning to establish service-oriented operations in the Philippines should begin monitoring these developments closely.

Administrative Order №18 issued in 2019 by the Former President Rodrigo Duterte

01 | Why Is the Government Considering This Change After Six Years?

Administrative Order №18 was issued in 2019.

At the time, the Philippine government suspended the approval of new PEZA economic zones within Metro Manila in an effort to encourage investment in regions outside the capital and promote more balanced regional economic development.

Six years later, the policy is being reconsidered.

According to Donald Patrick Lim, President of the Management Association of the Philippines (MAP), Metro Manila remains the country’s primary hub for information technology, business process management (IT-BPM), and other high-value service industries. He believes businesses should ultimately be able to choose their locations based on operational requirements rather than policy restrictions.

Recent statements from government agencies suggest this is also the rationale behind the proposed policy change.

The Philippines continues to pursue foreign investment while providing businesses with greater flexibility in deciding where to establish their operations.

02 | Why Does PEZA Status Matter When Choosing an Office?

Many companies exploring the Philippine market initially compare office rental costs, accessibility, surrounding amenities, and workplace quality.

However, when they begin registering a company or applying for investment incentives, one important question arises: Is the building PEZA-accredited?

For qualified export-oriented service enterprises, operating from a PEZA-accredited building may be a key requirement for accessing certain investment incentives. As a result, many companies verify a building’s PEZA status before finalizing a lease agreement.

Since AO18 took effect, the approval of new PEZA economic zones in Metro Manila has been suspended, limiting the number of PEZA-accredited office buildings available. Some businesses continued operating within existing PEZA buildings, while others established offices in alternative locations outside Metro Manila.

If the policy is lifted, newly accredited office buildings would significantly expand the range of options available to investors.

Call center agents working at computers with headsets in a modern office setting/ by AI25.Studio Studio via Pexels

03 | Which Businesses Should Pay Attention?

The proposed policy change will primarily affect service-based businesses, including:

• Business Process Outsourcing (BPO)
• Global Capability Centers (GCCs)
• Shared Service Centers
• Software Development Companies
• Research and Development (R&D) Centers
• Digital Service Providers
• Cross-border Operations and Regional Support Centers

These industries typically require access to skilled talent, mature business infrastructure, and internationally competitive office environments. As a result, Makati, Bonifacio Global City (BGC), Ortigas, Quezon City, and Alabang have remained among the most popular business locations.

According to PEZA, several new office buildings in Makati and Arca South are already awaiting accreditation. If AO18 is lifted, these properties could gradually enter the market as PEZA-certified office locations.

Real estate consultancy Savills Philippines believes the policy could stimulate demand in Metro Manila’s office market, particularly from existing PEZA-registered companies seeking to upgrade their offices as well as newly established service-sector investors.

What Should Businesses Do Now?

The proposal has now entered the formal recommendation stage, but several steps remain before any changes take effect.

First, the Office of the President must make the final decision. Second, even if AO18 is officially lifted, individual office buildings must still complete the PEZA accreditation process before becoming eligible.

For businesses, this is the right time to prepare — not to rush into changing office locations.

Companies planning to establish operations in the Philippines or currently evaluating office space should consider several factors together:

• Whether the building already has PEZA accreditation or is still undergoing the certification process;
• Whether the company’s business activities qualify for available investment incentives;
• Whether the proposed business address, operational plans, and future expansion strategy are aligned.

Although these may appear to be separate considerations, they are often closely connected during the investment process. Conducting proper due diligence early can reduce future adjustments, minimize compliance risks, and avoid unnecessary costs.

Final Thoughts

In previous years, companies selecting office space in the Philippines primarily focused on rent, floor area, and office fit-out requirements.

As investment policies continue to evolve, businesses must now consider a broader range of factors. Office location can influence not only daily operations but also eligibility for investment incentives, business registration arrangements, and long-term expansion plans.

Whether AO18 is ultimately lifted will depend on the final decision of the Office of the President. Nevertheless, businesses planning to enter the Philippine market should use this period to reassess their location strategy.

Evaluating investment incentives, business registration requirements, office location, and long-term operational planning together before signing a lease is generally more efficient and cost-effective than making adjustments later.

Sources: BusinessWorld, the Philippine Department of Trade and Industry (DTI), the Philippine Economic Zone Authority (PEZA), and other publicly available information.

About OCIC Consulting

OCIC Consulting provides comprehensive support for companies investing in the Philippines, including company registration, PEZA applications, BOI project registration, industry permit processing, tax and regulatory compliance, and project implementation consulting. We help businesses complete their investment projects efficiently and in full compliance with Philippine regulations.