GRANDFATHER RULE

CORPORATE LAYERING

Corporation A – nationalized business undertaking

1. 60% = 3 corporations (Corporation B – Filipino under the control rule)
(a) 35% Corporation D = 60% foreign + 40% Filipino
(b) 25% Corporation E = 30% foreign + 70% Filipino
(c) 40% Corporation F = 50% foreign + 50% Filipino
2. 40% = foreigner (Corporation C)