THE Japanese Chamber of Commerce and Industry of the Philippines Inc. (JCCIPI) has expressed concern over Joint Administrative Order (JAO) No. 2026-01 of the Department of Energy (DOE) and the Department of Environment and Natural Resources (DENR), particularly a provision that requires existing operators to turn over assets upon contract expiration.
In a letter sent to the DOE last week, the business group said Japanese businesses want to expand their investments in the Philippines, but they require a predictable investment environment across all sectors.
‘This raises questions regarding the legal basis for the requirement, its consistency with existing contractual arrangements, and its implications for private asset ownership and investor confidence.
JCCIPI believes that clarification of these provisions would help ensure that the implementation of the JAO supports the government’s resource-development objectives while maintaining a predictable environment for existing and prospective investors,’ it said.
It pointed out that the financial recovery, amortization, or depreciation of an asset does not automatically transfer its legal ownership to the government. Forcing operators to surrender privately owned assets threatens their financial standing and reduces their asset value.
‘The scope and legal basis of the turnover requirement therefore require clarification, particularly where assets were acquired using private capital and remain privately owned,’ it said. ‘JCCIPI is concerned that unclear requirements could discourage qualified operators from participating in future auctions and affect the decisions of prospective investors considering the Philippine mining industry.’
It recommended that the DOE and the DENR clarify and ensure fairness regarding asset ownership and bidding procedures.
‘JCCIPI respectfully requests that the DOE and DENR:
1. Clarify the scope and legal basis of Section 6.10, particularly whether existing operators participating in contract renewal or re-award proceedings are subject to these asset turnover mandates.
2. Clarify the legal basis for asset transfers, including whether the recovery, amortization, or depreciation of an asset’s cost may be used as a basis for transferring ownership to the government.
3. Ensure fair and consistent bidding procedures, with clear rules that apply equally to qualified participants and respect applicable laws and existing contractual rights.’
The DOE, for its part, said it will restart the bidding process this month. ‘Bidders will be given at least one month to prepare documents, with evaluation scheduled around November or December,’ Garin said.
Semirara Mining and Power Corp. (SMPC) currently holds coal operating contract (COC) No. 5, which is among the coal blocks on Semirara Island that will be auctioned by the DOE. The COC is valid until July 14, 2027.
The previous bidding for coal mining areas has been canceled to implement a new bidding process under updated rules, following the conclusion of the second public consultation. The DOE said this was meant to reassess the parameters of awarding coal operating contracts so that the next round can be conducted under this new set of rules.
The coal bid round covered three pre-determined areas in Antique, Cagayan, and Isabela, offered for development and production coal operating contracts (DP COCs) under the Philippine Conventional Energy Contracting Program (PCEP). It was met with heavy resistance stemming from legal, technical, financial concerns.
Garin clarified that the rules are uniform for all participants and are not targeting or excluding any specific company. ‘Anyone who qualifies under the established rules will be considered because it’s the same rules for everyone. Everyone is given a chance,’ she said.