Japanese chamber challenges Philippine resource auction rules
A proposed requirement to transfer assets to the government at contract expiry has drawn objections as the 2026 coal auction remains stalled.
Proposed Philippine rules for awarding natural resource contracts have drawn opposition from a Japanese business group over an asset-transfer provision. The group warned that requiring operators to surrender assets when contracts end could damage investor confidence and companies’ access to financing.
In a position paper to the Department of Energy (DOE), the Japanese Chamber of Commerce and Industry of the Philippines Inc. (JCCIPI) challenged Section 6.10 of a proposed joint administrative order. The measure is being developed by the DOE and the Department of Environment and Natural Resources.
The chamber questioned whether the provision had a legal basis and how it would align with existing agreements and private ownership. It warned of weaker corporate balance sheets, reduced borrowing capacity and potential losses in shareholder value at listed companies.
JCCIPI called for transparent auction rules and equal treatment of qualified participants. It opposed automatic renewals but said investments made under current contracts should not put incumbent operators at a disadvantage. It also sought clarity on how the order would work alongside resource legislation, including Presidential Decree 972, the Coal Development Act of 1976.
The framework has delayed the DOE’s 2026 coal auction, which includes the Philippines’ largest coal mine, located on Semirara Island in Antique. The department put forward the framework after the auction began, prompting objections from stakeholders including Semirara Mining and Power Corp. Bidding remains on hold while the government completes the guidelines.
