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Gentlemen :
This refers to your letter dated September 26, 2008 stating that your client,
Lindberg AG-A4 Philippine Branch (the Branch), is the Philippine branch of
Lindberg AG (LAG), a foreign corporation established under the laws of
Switzerland which is engaged in the business of trading and sale of
spectacles/optical frames and related accessories; that these spectacle and optical
frames are products of Lindberg A/S (LAS) which is another foreign corporation
established under the laws of Denmark; that LAG and LAS are members of the
global Lindberg Group of Companies; that a couple of years ago, LAG acquired
from LAS the exclusive right to sell and distribute the latter's products in and
outside Europe; that in 2006, LAG established the Branch to take over its sales to
non-European markets (A4 markets), while retaining its right to cover the sales in
Europe; that to ensure the marketability of the products in the A4 market, the
Branch secured the assistance of LAS to undertake promotional activities in these
areas and to accept orders from customers in the A4 markets considering that the
Branch is located in the Philippines; that the business relationship between LAS
and the Branch with regard to the sales made in the A4 markets, was formalized
via a Service Agreement (the Agreement) specifying therein the services to be
rendered by LAS to the Branch; that one of the services provided for under this
Agreement is for LAS to manage the Branch client accounts in the A4 markets by
means of the following: aCcHEI
that LAS issues individual invoices to buyers located in the A4 markets on behalf
of the Branch; that these invoices issued abroad primarily serve as written
acknowledgments of delivery of goods to the A4 markets; that upon receipt of the
monthly summaries the Branch then issues BIR-registered (single) manual
monthly invoices reflecting therein the aggregate amount of all the invoices issued
abroad; that a summary of the invoices issued in a month by LAS is attached to the
monthly aggregate invoice issued by the Branch along with the transmittal letters
received from LAS; and that the single monthly invoices issued by the Branch
contain on their faces the following data:
e. Order Number;
In reply thereto, please be informed that Section 237 of the Tax Code of
1997 provides that —
Copyright 2019 CD Technologies Asia, Inc. and Accesslaw, Inc. Philippine Taxation Encyclopedia Third Release 2019 2
"SEC. 237. Issuance of Receipts or Sales or Commercial Invoices.
— All persons subject to an internal revenue tax shall, for each sale or
transfer of merchandise or for services rendered valued at Twenty-five pesos
(P25.00) or more, issue duly registered receipts or sales or commercial
invoices, prepared at least in duplicate, showing the date of transaction,
quantity, unit cost and description of merchandise or nature of service:
Provided, however, That in the case of sales, receipts or transfers in the
amount of One hundred pesos (P100.00) or more, or regardless of the
amount, where the sale or transfer is made by a person liable to VAT to
another person also liable to VAT; or where the receipt is issued to cover
payment made as rentals, commissions, compensations or fees, receipts or
invoices shall be issued which shall show the name, business style, if any,
and address of the purchaser, customer or client: Provided, further, that
where the purchaser is a VAT-registered person, in addition to the
information herein required, the invoice or receipt shall further show the
TIN of the purchaser.
This Office in separate occasion had again the opportunity to rule in BIR
Ruling No. 085-94 dated April 6, 1994, as follows: TCSEcI
SUCH BEING THE CASE, this Office hereby confirms your opinion that
the issuance by the Branch of the monthly aggregated sales invoice is sufficient
compliance with the invoicing requirements prescribed in Section 237 of the Tax
Code of 1997.
Copyright 2019 CD Technologies Asia, Inc. and Accesslaw, Inc. Philippine Taxation Encyclopedia Third Release 2019 4
This ruling is being issued on the basis of the foregoing facts as
represented. However, if upon investigation, it will be disclosed that the facts are
different, then this ruling shall be considered null and void.
Copyright 2019 CD Technologies Asia, Inc. and Accesslaw, Inc. Philippine Taxation Encyclopedia Third Release 2019 5