BIR Ruling No. 346-2021

REPUBLIC OF THE PHILIPPINES

DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE Quezon City

Ir Sections 27 (A), 27 (D) (5), 56 BIR Ruling No. 1286-2018 (A), 106,188, and 196, of the National Code of 1997, as amended Internal Revenue

OC CT-346-22 0 42821

MENDOZA & PANGAN Unit II-I, V. Madrigal Building 6793 Ayala Avenue, 1226 Makati City

Attention: ATTY. EDUARDO M. PANGAN

Gentlemen:

This refers to your request on behalf of your client, NHK Spring Philippines, Inc. ("NSP"),"for confirmation that the transfer of the shares owned by"NSP Employees Retirement Trust ("NSP ERT") from the previous trustee to the successor-trustee is not

subject to capital gains tax (CGT) and documentary stamp tax (DST).

Background:

Documents submitted disclosed that NSP has established the NSP Employees Retirement Plan for the purpose of providing retirement and other benefits for all its eligible and regular employees. The NSP Employees' Retirement Plan contemplated the creation of a fund to which contributions shall be made and from which disbursements shall be paid, and provides for a trustee to receive, hold, invest, and administer the same. Thus, on December 06] 2012, a Trust Agreement was entered into by and between NSP and the Bank of the Philippine Islands ("BPI") where the former has appointed the latter as its trustee.

However, the trust entity BPI Asset Management Trust Group (BPI-AMTG) as a trust department of BPI was spun-off into BPI Asset Management Trust Corporation (BPI-AMTC)] a stand-alone trust corporation. Therefore, the trust fund subject of the Trust Agreement dated December 06, 2012 was transferred by BPI-AMTG to BPI-AMTC.

Properties, Inc. ("LTPI") which BPI-AMTC holds in its capacity as the trustee of NSP Employees Retirement Trust Fund, broken down as follows: RDI-AMTC (bv itself and its nominees) is the registered shareholder of a total of ! preferred shares of the capital stock of Laguna Taiyo

Glenn M. Santos BPI-AMTC as Trustee of NSP ERT Amalia Lourdes S. Valdez Marie Jacqueline A. Alcaraz Total

of Assignment dated September 22, 2017 transferring to MBTC-TBG, as the new trustee, the Banking Group ("MBTC-TBG") as the new trustee. Thereafter, BPI-AMTC executed a Deed AMTC, effective upon ability of the trustee to transfer and the successor-trustee to receive the funds/assets of the NSP ERT. NSP appointed Metropolitan Bank & Trust Company - Trust LTPI preferred shares. Hence, this request. On March 07, 2017, NSP served a notice to terminate the Trust Agreement with BPI-

NHK SPRING PHILIPPINES, INC. OCT 0 4 2HEt C-

the aforementioned property as a result of the change of trustee from BPI-AMTC to MBTC. TBG under a Deed of A'ssignment dated September 22, 2017, the said transfer is not subject to CGT under Section 24 (D) of the National Internal Revenue Code of 1997, as amended. There is no change in beneficial and equitable ownership. In reply, please be informed that that since there is no actual transfer of ownership over

transaction, the same is not subject to DST under Section 196 of the National Internal Revenue is subject to DST of P15.00' under Section 188 of the same Code. Code of 1997, as amended. However, the notarial acknowledgment of the Deed of Assignment Also, since there is no sale, exchange or disposition of property involved in the

Revenue Regulations (RR) No. 24-2002. is necessary to effect the change of trustee in the BPI-AMTC to MBTC-TBG. In this regard, this Ruling shali be presented to the Revenue District Office (RDO) concerned in order for the latter to issue the CAR as prescribed in Notwithstanding foregoing, the issuance of Certificate Authorizing Registration (CAR) LTPI preferred Shares transferred by

if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. This ruling is being issued on the basis of the foregoing facts as represented. However.

Very truly yours.

U8 eWwaA

K-I-LMAT Commissioner of Internal Revenue CAESAR R. DULAY t 045855 O

1 The old DST rate of P15.00 is used since the transaction took place prior to the effectivity of Republic Act (RA) No. 10963.

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