Philippine BPO Policy Tracker: AI Laws and Rules for 2026

Anyone following Philippine outsourcing news over the past twelve months has needed a running file: a connectivity law that took effect without a presidential signature, a rewritten incentives code, an emergency work-from-home order, and the most serious attempt yet at a national AI statute. Each one changes the operating maths for BPO firms, and several change the job security calculus for the people they employ.

This tracker consolidates the policy actions that matter for the sector as of 6 August 2026. Every item carries its instrument number, its status on that date, and a link to the page we actually read. Where a measure is still moving through Congress, we say so plainly instead of reporting it as done.

The Konektadong Pinoy Act Is Now Operational

Republic Act No. 12234, the Konektadong Pinoy Act, lapsed into law on 24 August 2025 after the President took no action on the enrolled bill, and its implementing rules were signed on 5 November 2025. The law removes the oldest structural barrier in Philippine connectivity: data transmission providers no longer need a legislative franchise from Congress. Registration with the National Telecommunications Commission is enough to enter the market.

The implementing rules add teeth. They mandate access and infrastructure sharing on fair, reasonable and non-discriminatory terms, create an expedited registration lane for small and community operators in underserved areas, and back the regime with administrative fines of PHP 50,000 to PHP 5,000,000 per violation.

For operators, the practical stakes are redundancy and price. Provincial delivery sites have long depended on one or two providers, and a registration-based market lowers the barrier for new entrants and for ecozone locators contracting alternative links. PLDT and Globe Telecom, through the Philippine Chamber of Telecommunications Operators, opposed the law on security and constitutional grounds, so friction during early implementation is likely. Watch the NTC's first wave of registrations, not the press statements.

CREATE MORE Remains the Tax Baseline

Republic Act No. 12066, the CREATE MORE Act, was approved on 8 November 2024 and is still the reference document for BPO incentives. The statute taxes registered business enterprises under the enhanced deductions regime at 20 percent, grants a 100 percent additional deduction on power expenses used for the registered activity, and caps the local tax that LGUs may impose on an RBE at 2 percent of gross income.

The provision operators cite most is Section 309, which lets an RBE run a telecommuting program covering up to 50 percent of its workforce without losing any incentive. The implementing rules were signed on 17 February 2025. Location flexibility clearly matters to the industry: when the rules were signed, the Inquirer reported that more than 440 companies had applied to transfer registration to the Board of Investments, which does not tie incentives to operating inside a designated zone.

A Temporary 90 Percent Work-From-Home Window Is Open

On top of the statutory 50 percent rule sits an emergency measure. FIRB Resolution No. 005-2026, approved on 10 April 2026, authorises investment promotion agencies to let RBEs place up to 90 percent of their registered-project workforce on work-from-home arrangements. The trigger was Executive Order No. 110, issued on 24 March 2026, which declared a state of national energy emergency in light of the conflict in the Middle East.

The window is conditional. IPAs may set a lower ceiling, though not below 50 percent. RBEs must keep their export revenue levels and their current headcount, notify their IPA, and post surety bonds when moving tax-free equipment outside the zones. The authority runs for one year from 24 March 2026 unless EO 110 is lifted or extended earlier.

The planning implication is plain: hybrid staffing at scale is lawful into the first quarter of 2027, but it rests on an emergency order, not a right. Real estate and seat-count decisions should be modelled on the permanent 50 percent rule, with the 90 percent window treated as contingency room.

The AI Bill Has Reached Serious Committee Work

The House of Representatives is consolidating 26 bills, 3 resolutions and a privilege speech into a draft Artificial Intelligence Development and Regulation Act, steered by a technical working group under the Committee on Information and Communications Technology chaired by Rep. Javier Miguel Benitez. The draft is risk-based: most AI systems would face no registration requirement, safety checks would apply only to high-risk systems, and startups could test under supervised sandboxes.

Two provisions reach directly into BPO employment practice. Under the draft, no Filipino may be dismissed by an algorithm alone, and employers must give 60 days' notice and retraining before any displacement caused by AI. Around 60 stakeholders joined the 14 July 2026 deliberations, with amendments due by 20 July. As of 6 August 2026 the measure remains at committee stage; neither chamber has passed it.

If the text survives in this form, automation-linked workforce reduction becomes a documented, noticed and retraining-backed process rather than an internal decision. Operators planning AI deployments should cost that compliance path now. Workers, for their part, would gain a statutory floor that no current Philippine law provides.

The Skills Pipeline Is Getting Institutions of Its Own

Three actions in early 2026 built out the training side of the ledger. The Department of Science and Technology activated the National Artificial Intelligence Center for Research and Innovation on 26 February 2026, positioning it as the institutional backbone of the national AI strategy, with DOST leading research, DICT infrastructure, CHED and DepEd talent development, and DTI commercialisation.

A month earlier, PEZA, TESDA and StackTrek launched the country's first government-led AI Tech Academy on 16 January 2026 in Mandaue City, Cebu. PEZA-registered workers can take its AI, data science and fintech programs at no charge, and the first batch of locator trainees has already begun. For BPO employers inside ecozones, this is subsidised reskilling capacity worth folding into workforce plans.

Congress also extended the second Congressional Commission on Education. Republic Act No. 12315, signed on 4 March 2026, gives EDCOM 2 two more years and explicitly tasks it with integrating artificial intelligence and digital technologies into the national education agenda. The talent pipeline the industry hires from is now, by statute, an AI question.

What to Watch Before Year-End

• The AI bill's committee vote. The working group reconvenes after the 20 July amendment deadline; a substitute bill approved at committee would be the strongest signal yet that the 60-day displacement rule becomes law.
• NTC registrations under RA 12234. New data transmission entrants, especially outside Metro Manila, are the real test of whether the Konektadong Pinoy Act changes prices in practice.
• The fate of EO 110. If the energy emergency is lifted early, the 90 percent WFH authority lapses with it and the 50 percent CREATE MORE rule reasserts itself.

We will keep this tracker updated as statuses change. For rolling coverage of BPO news in the Philippines, see our industry news desk.