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The Subic International Airport project, which is currently in the comparative challenge stage, will offer the winning concessionaire a competitive package of fiscal incentives designed to support long-term private sector investment
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The concessionaire qualifies for a 5% special corporate income tax for up to 16 years from the start of commercial operations, with the possibility of an extension in accordance with the CREATE MORE Act
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There are exemptions from customs duties and value-added tax on importations as well as zero-rated VAT on qualified local purchases
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The project also presents opportunities to develop diversified revenue streams through regulated and unregulated aeronautical services, cargo handling, warehousing, commercial leasing, logistics services, and other non-aeronautical businesses
The Subic International Airport (SIA) project, which is currently in the comparative challenge stage, will provide the winning concessionaire a competitive package of fiscal incentives designed to support long-term private sector investment, according to the Public-Private Partnership Center of the Philippines (PPP Center).
Upon registration as an export enterprise with the project’s implementing agency, the Subic Bay Metropolitan Authority (SBMA), the concessionaire may qualify for a 5% special corporate income tax (SCIT) for up to 16 years from the start of commercial operations, with the possibility of an extension in accordance with Republic Act (R.A.) No. 12066, or the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act.
Under the SCIT regime, the concessionaire will be exempt from all national and local taxes.
In addition, registered export enterprises may benefit from exemption from customs duties and value-added tax (VAT) on importations, as well as zero-rated VAT on qualified local purchases, creating a competitive fiscal environment that supports investment, airport modernization, and long-term business growth, PPP Center said in a statement.
Beyond airport operations, PPP Center said the project also presents opportunities to develop diversified revenue streams through regulated and unregulated aeronautical services, cargo handling, warehousing, commercial leasing, logistics services, and other non-aeronautical businesses, enabling the concessionaire to maximize the airport’s commercial potential.
SBMA on July 31 opened the unsolicited proposal to transform SIA into a strategic air freight and logistics hub to challengers.
READ: SBMA opens Subic airport project proposal to challenge bids
In an instruction to bidders, SBMA opened the comparative challenge process under an operate-rehabilitate-add-transfer scheme in accordance with R.A. No. 11966 or the PPP Code of the Philippines.
A pre-bid conference is scheduled on September 14 while the submission of comparative proposals and opening of such submissions will be on October 29, 2026.
Prospective bidders will be challenging the proposal submitted on March 26, 2025 by Cerberus Asia Pacific Investments LLC.
Cerberus Asia Pacific is under US-based private equity firm Cerberus Global Investment LLC. Together with Agila NY Naval Inc./Agila South Inc., they acquired in 2022 the 300-hectare area in Subic Bay Freeport that was once occupied by South Korean shipbuilder Hanjin Heavy Industries and Construction-Philippines, Inc.
Malacañang earlier said Cerberus Global plans more investments in the Philippines, including the conversion of SIA as a cargo and logistics hub.
Following the successful detailed evaluation and negotiations between SBMA and Cerberus Asia, the latter has been granted original proponent status for the project, hence the start of the comparative challenge. The original proponent’s estimated project cost is P7 billion for the construction, renovation and/or rehabilitation.
In an invitation dated April 27, SBMA said the SIA project includes the upgrade, expansion, operation and maintenance for a concession period of 25 years, subject to extension.
According to the PPP Center, most existing structures and interior fit-outs within SIA have deteriorated and require major repairs and refurbishment to restore the assets to full operational conditions.
The refurbishment works will include comprehensive upgrades to facilities located on the southwest and southeast aprons, covering the repair and restoration of structural and architectural components, as well as the maintenance and replacement of mechanical and electrical systems, as necessary. All works should be undertaken in accordance with applicable regulations and safety standards to ensure that the facilities remain functional, safe, and compliant with applicable regulatory requirements.
The project also includes operational and infrastructure improvements aimed at enhancing airport safety, regulatory compliance, and operational efficiency. This includes the Runway End Safety Area (RESA) Improvement Project, which involves extending the existing RESA to comply with established safety standards and providing a larger obstacle-free buffer zone for aircraft safety.
The project also includes coordination with relevant government agencies, including the Civil Aviation Authority of the Philippines for air traffic control and airport safety, and the Philippine Atmospheric, Geophysical and Astronomical Services Administration for meteorological and hydrological services. Additional operational expenditures during the concession period are expected to include local business taxes, airport management fees, and revenue-sharing obligations payable to SBMA.
The project also includes upgrades, new developments, and the acquisition of equipment to expand airport capacity, improve operational efficiency, and support new service offerings such as commercial cargo and government warehousing operations.
Planned developments include new infrastructure projects within SIA as part of its leasing operations. The Midway Apron Development will consist of two warehouse buildings with an approximate combined total floor area of 22,400 square meters (sqm) and a 32,000 sqm aircraft staging and parking area.
The North Airport Land Development, meanwhile, will cover approximately 88,000 sqm subdivided into four parcels intended for warehouse facilities, a hangar and storage facility, and additional apron space.
According to the project information memorandum, the development of existing and new facilities will transform SIA into a higher-capacity logistics hub, strengthening its role in national infrastructure modernization and supporting economic growth while reinforcing its strategic relevance.
The project will also enable SBMA to develop the airport as an alternative cargo hub to congested Ninoy Aquino International Airport.
The comparative challenge will be a single-stage bidding process, where each challenger will submit a comparative proposal consisting of qualification documents, a technical proposal, and a financial proposal.
Under the right-to-match mechanism, the original proponent will be given the right to match or better the financial proposal of the most superior comparative proposal.
In case the SBMA Pre-Qualification/Qualification, Bids and Awards Committee determines the financial proposal of the original proponent to be superior or more advantageous to the government or in case there is no challenger, the PPP contract will be awarded to the original proponent.
