Law on Investment Promotion

The Law on Investment Promotion of 2009 regulates domestic and foreign investment to facilitate investments according to the law. It protects investors', public and citizens' rights under the objective of enhancing socio-economic growth.

Incentives offered by the law, which are potentially applicable to renewable energy investments, include:

• Duty free import of production machinery, equipment and raw materials;
• Duty free import for chemical materials necessary for biofuels production within seven years;
• Profit tax of three categories according to five different investment promotion zones (detailed in the law);
• Profit tax exemption in the following accounting year, if net profits are used for business expansion.

Additional incentives under the same law apply to large and small-scale hydropower generation. The Department of Energy Business (DEB) of the Ministry of Energy and Mines provides to investors, among others:

• Free access to land (including potential flooding zones);
• Waiver on land conversion fees (USD 15,000 per hectare);
• Waivers or reduced rates on import duty for materials, equipment and supplies.

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