Cttee. Report No.79

7/29/2019 Cttee. Report No.79

1/39

~~pl.lblit: crftire ll~iJ ippitlno

~ous~ of ~~pr~s~tdati\J~s)uuon lUitv, .,1IItdro~htnlln

THE DEPUTY SECRETARY GENERALFOR OPERATIONS

THE EXECUTIVE DIRECTORPLENARY AFFAIRS BUREAU

THESER~CEDIRECTORBILLS AND INDEX SERVICE

THE DEPUTY SECRETARY GENERALFOR COMMITTEE AFFAIRS

79COMMITTEE REPORT Nt>~ _

We are transmitting six (6) copiesofthe Committee Report submitted by the Committee onAgriculture and Food on House Bili No. 2976, in substitution to HB Nos. 607,1402, 1517, 1521 and 2470, entitled:

'AN ACT TO EXTEND THE UTILIZATION PERIOD OF THE AGRICULTURALCOMPETITIVENESS ENHANCEMENT FUND, AMENDING REPUBLIC ACT NO.

8178, ENTITLED AN 'AN ACT REPLACING QUANTITATIVE IMPORTRESTRICTIONS ON AGRICULTURAL PRODUCTS, EXCEPT RICE, WITH TARIFFS,

CREATING THE AGRICULTURAL COMPETITIVENESS ENHANCEMENT FUND,AND FOR OTHER PURPOSES".

ATTY. ENE DADA-ARNALDO

Deputy S cretary General . 1 '1;r


2/39

. . . ":I '

'". ..,.7;~""'::-~

","':~,

"' "

~Jlublil of tipJ14iHppitlu,

~nus~ nf ~~pr~s~tlbtti\Jes~uu(Jn


3/39

lIB No. 1521, entitled, 'AN ACT EXTENDING THE UTILIZATION PERIOD

OF THE AGRICULTURAL COMPETITIVENESS ENHANCEMENT FUND,

AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 8178, ENTITLED,

'AN ACT REPLACING QUANTITATIVE IMPORT RESTRICTIONS ON

AGRICULTURAL PRODUCTS, EXCEPT RICE, WITH TARIFFS,

CREATING THE AGRICULTURAL COMPETITIVENESS ENHANCEMENTFUND, AND FOR OTHER PURPOSES', authored by Rep. Darlene R.Antonino-Custodio; and

lIB No. 2470, entitled, 'AN ACT EXTENDING THE UTILIZATION PERIODOF THE AGRICULTURAL COMPETITIVENESS ENHANCEMENT FUND,AMENDING FOR THE PURPOSE SECTION 8 OF REPUBLIC ACT NO.8178, ENTITLED, 'AN ACT REPLACING QUANTITATIVE IMPORT

RESTRICTIONS ON AGRICULTURAL PRODUCTS, EXCEPT RICE, WITHTARIFFS, CREATING THE AGRICULTURAL COMPETITIVENESS

ENHANCEMENT FUND, AND FOR OTHER PURPOSES', authored by Rep.

Ma. Carissa O. Coscolluela,

has considered th~.a.nd has the honor to recommend to the House that the attachedHouse Bill No. ~ ~(0,entitled:

"AN ACT TO EXTEND THE UTILIZATION PERIOD OF THEAGRICULTURAL COMPETITIVENESS ENHANCEMENT FUND,AMENDING REPUBUC ACT NO. 8178, ENTITLED 'AN ACTREPLACING QUANTITATIVE IMPORT RESTRICfIONS ONAGRICULTURAL PRODUCTS, EXCEPT RICE, WITH TARIFFS,CREATING THE AGRICULTURAL COMPETITIVENESSENHANCEMENTFUND,ANDFOR OTHER PURPOSES"

be approved in substitution to House Bill Nos. 607, 1402, 1517,1521 and 2470 withReps. Ma. Evita R. Arago, Diosdado Macapagal Arroyo, Ferdinand Martin G.

Romualdez, Rene M. Velarde, William Irwin C. Tieng, Edgar M. Chatto, Rodolfo W.

Antonino, Faysah RPM Dumarpa, Ana Theresia N. Hontiveros Baraque~ George P.Arnaiz, Antonio F. Lagdameo Jr., Guillermo A. Romarate Jr., Jose V. Y ap, Victor J. Y u,Adam Relson L. Jala, Thelma Z. A lmario, Cecilia M. Seares-Luna, Mark Leandro I.Mendoza, Rommel C. Amatong, Dulce Ann K. Hofer, Nelson L. Dayanghirang, Nicanor

M. Briones, Belma A. Cabilao, Jocelyn Sy-Limkaichong, Robert Raymund M. Estrella,Marina P. Clarete, Y evgeny Vincente B. Emano, Rosendo S. Labadlabad, Leonila V.Chavez,Ma. VictoriaR. Sy-Alvarado, DaniloP. Lagbas, leci A. Lapus, Proceso1.Alcala, HenryPrydeA. Teves, Isidro T. Ungab, SolomonR. Chungalaoand Ronald V. Singson as co-authorsthereof.

REP.AB KAm,u,B.MITRAChairman

Committee on Agriculture and Food


4/39

s~ flage of, tire ~ 9leptvd on tfuS~tituU 9J iJ 1of,9l9J .N6-6. 607,1402,1517,1521 and 2470

ARROY O, DIOSDAOO M.

fommittee on~and flood

~/?A~

CABILAO, DELMA A.

~~~.CIIA VEl., LEONILA V.


5/39

~~~o:::--.--


6/39

t

~l L i t -

/

p~~~

/

.., I

~a,U?-k ocP.~;uMhI, CZARINA D.


7/39

;7At-;;;Z~~ESCUDERO I I I , SALVADOR H.


8/39

FACT SHEET

;". (. ON 2976H.B. No. _ (in substitution to HB Nos. 607, 1402, 1517, 1521 and 2470)

TITLE "AN ACT TO EXTEND THE U11UZATION PERIOD OF THEAGRICULTURAL COMPE 1IIIVENESS ENHANCEMENT FUND,

AMENDING REPUBUC ACT NO. 8178, ENTITLED "AN ACT REPLACINGQUANTITATIVE IMPORT RESTRICTION ON AGRICULTURALPRODUCTS, EXCEPT RICE, WITH TARIFFS, CREATING THEAGRICULTURAL COMPE 1IIIVENESS ENHANCEMENT FUND, AND FOROTHER PURPOSESn

AUTHORS REPS. ALFREDO D. MARANON ill, ABRAHAM KAHLIL B. MITRA, MA.EVITA R. ARAGO, LUIS R. VILLAFUERTE, DIOSDADO MACAPAGAL ARROY O,DARLENE R. ANTONINO-CUSTODIO, MA CARISSA O. COSCOLLUELA, RENE M.VELARDE, FERDINAND MARTIN G. ROMUALDEZ, WILLIAM IRWIN C. TIENG, EDGARM. CHATTO, RODOLFO W. ANTONINO, FAYSAH RPM DUMARPA, ANA-THERESIA N.HONTIVEROS-BARAQUEL, GEORGE P. ARNAIZ, ANTONIO F. LAGDAMEO JR.,GUlLLERMO A. ROMARATE JR., JOSE V. YAP, VICTOR J . Y D, ADAM RELSON L. J ALA,

THELMA Z. ALAMRIO, CECILIA M. SEARES-LUNA, MARK LEANDRO I. MENDOZA,ROMMEL C. AMATONG, DULCE ANN K. HOFER, NELSON L. DAY ANGHIRANG,NlCANOR M. BRIONES, BELMA A. CABILAO, JOCELYN SY-LIMKAICHONG, ROBERTRAYMUND M. ESTRELLA, MARINA P. CLARETE, Y EVGENY VICENTE B. EMANO,ROSENDO S. LABADLABAD, LEONlLA V. CHAVEZ, MA. VICTORIA R. SY-ALVARADO,DANILO P. LAGBAS, mCI A. LAPUS, PROCESO 1. ALCALA, HENRY PRY DE A. TEVES,ISIDRO T. UNGAB, SOLOMON R. CHUNGALAO and RONALD V. SINGSON

RATIONALE section 8 of Republic Act No. 8178 created the Agricultural Competitiveness

Enhancement Fund (ACE F) with a life span of nine (9) years, the purpose of which was to cushionthe effect of the lifting of quantitative restrictions on affected sectors of agriculture. However, moneycollected for AC EFfrom 1996 to 1998 was not disbursed according to its purpose as collections wereused for budgetary support instead.

OBJECTIVE: There is a need to extend the utilization period of the ACEFin order to enablethe government further to provide the farming sector the opportunity to use the funds to strengthentheir development activities and to enhance their competitiveness.

All duties collected from the importation of agricultural products under the minimum

access volume (MAV) mechanism, unused balance and repayments from loan benefidaries

including interests, if any, shall accrue to SpecialAccount 183 and shall be deposited with

the National Treasury; and

After the expiration of the extension of the utilization in 2015, the remaining balance shall

revert to the General Fund.


9/39

BR IE FE R

ON

RE PUBL I C A CT 8178

RA No. 8178 was signed into law on 28 March 1996. It is an kt replacingquantitative restrictions (QRs) on Agricultural Products, except rice, with

tariffs;

The State adopts the use of tariffs, in lieu of non-tariff import restrictions

to protect local producersof agricultural products;

RA 8178 created the Agricultural Competitiveness Enhancement Fund(ACEF),which was granted a life span of nine (9) years after which allremaining balancesshall revert to the General Fund;

The ACEF consists of all tariffs collected from the importation ofagricultural products under the MinimumAccessVolumes (MAVs);

The proceeds of the importation of the minimum accessvolume shall becredited to SpecialAccount 183and depositedwith the NationalTreasury;

The entire proceeds shall be set aside and earmarked by Congress forirrigation, farm-to-market roads, post-harvest equipment and facilities,credit, research and development, other marketing infrastructure,provision of market information, retraining, extension services, and other

forms of assistanceand support to the agricultural sector.

The Fund should have expired in 2005, however, ACEFwas not disbursedaccording to the intended original purpose; instead, the money collected

for the ACEFfrom 1996to 1998was utilized for budgetary support, thus,extending the expiration of the Fund until December2007;

There are proposals to extend the utilization period of the AgriculturalCompetitive EnhancementFund (ACEF)jSpecialAccount 183 until 2015,

amending section 8 of RA8178.

There is a need to extend the utilization period of the ACEFto enable thegovernment to provide the farming sector the opportunity to usethe fundsto strengthen their development activities and enhance theircompetitiveness.


10/39

Republic of the Philippines

HOUSE OF REPRESENTATIVESQuezon City

FOURTEENTH CONGRESS

First Regular Session

HOUSE BIL L ~~~_(:__ 2_ 9_ 7_ 6_

Introduced by the Hono r ab l e s ALFREDO D. MARANON Ill, ABRAHAM KAHLIL B. MITRA,

MA. EVITA R. ARAGO, LUIS R. VILLAFUERTE, DIOSDADO MACAPAGAL

ARROYO, DARLENE R. ANTONINO-CUSTODIO, MA. CARISSA O.

COSCOLLUELA, RENE M. VELARDE, FERDINAND MARTIN G. ROMUALDEZ,WILLIAM IRWIN C. TIENG, EDGAR M. CHATTO, RODOLFO W. ANTONINO,

FAYSAH RPM DUMARPA, ANA-THERESIA N. HONTIVEROS-BARAQUEL,

GEORGE P. ARNAIZ, ANTONIO F. LAGDAMEO JR., GUILLERMO A. ROMARATEJR., JOSE V. Y AP, VICTOR J. Y D, ADAM RELSON L. JALA, THELMA Z.

ALMARIO, CECILIA M. SEARES-LUNA, MARK LEANDRO I. MENDOZA,

ROMMEL C. AMATONG, DULCE ANN K. HOFER, NELSON L. DAY ANGHIRANG,

NICANOR M. BRIONES, BELMA A. CABILAO, JOCELYN SY-LIMKAICHONG,ROBERT RAYMUND M. ESTRELLA, MARINA P. CLARETE, Y EVGENY VICENTE

B. EMANO, ROSENDO S. LABADLABAD, LEONILA V. CRA VEZ, MA. VICTORIAR. SY -ALVARADO, DANILO P. LAGBAS, JECI A. LAPUS, PROCESO J. ALCALA,

HENRY PRYDE A. TEVES, ISIDRO T. UNGAB, SOLOMON R. CHUNGALAO and

RONALD V. SINGSON

AN ACT

TO EXTEND THE UTILIZATION PERIOD OF THE AGRICULTURAL COMPETITIVENESSENHANCEMENT FUND, AMENDING REPUBLIC ACT NO. 8178, ENTITLED "AN ACT

REPLACING QUANTITATIVE IMPORT RESTRICTIONS ON AGRICULTURAL PRODUCTS,EXCEPT RICE, WITH TARIFFS, CREATING THE AGRICULTURAL COMPETITIVENESS

ENHANCEMENT FUND, AND FOR OTHER PURPOSES"

7 SHALL CONSIST OF AL L DUTIES COLL ECTED FROM the importation of

8 AGRICUL TURAL PRODUCTS UNDER THE minimum access volume (MAV)


11/39

1 MECHANISM, INCLUDING UNUSED BALANCE AND COLLECTIONS FROM

2 REPAYMENTS FROM LOAN BENEFICIARIES INCLUDING INTERESTS, IF

3 ANY. THE FUND SHALL BE AUTOMATICALLY CREDITED TO SPECIAL

4 ACCOUNT 183 IN THE GENERAL FUND OF THE NATIONAL TREASURY:

5 PROVIDED,THAT FUND RELEASES SHALL NOT BE SUBJECT TO ANY

6 CEILING BY THE DEPARTMENT OF BUDGET AND MANAGEMENT (DBM).

7 The entireproceeds shall be set aside and earmarked by Congress for irrigation,

8 farm-to-market roads, post-harvest equipment and facilities, credit, research and

9 development, other marketing infrastructure, provision of market information, retraining,

10 extension services, MICRO, SMALL AND MEDIUM SCALE ENTERPRISES

11 (MSMSE) IN AGRICULTURE, AQUACULTURE AND FISHERIES SECTORS;

12 YOUNG ENTREPRENEURS, OUT-OF-SCHOOL YOUTH, GRADUATES OF

13 AGRICULTURE, FISHERIES AND RELATED COURSES; AGRICULTURE

14 AND FISHERY COOPERATIVES ENGAGED IN ECONOMIC ENTERPRISES

15 and other forms of assistanceand supportto theagricultural sector.

16 The Committees on Agriculture and Food, Appropriations and Finance of both

17 the SenateandtheHouse of Representatives shall conduct aperiodic review of theuse of

18 the Fund. The Fund shall [have a life of nine (9) years] EXIST UNTIL THE YEAR

19 2015, after whichall remaining balances shall reverttotheGeneral Fund."

20 SEC. 2. A new sectionis hereby insertedafter Section8 [ofR.A. 8178] to be designated

21 as Section9to read as follows:

22 SEe. 9. THE DEPARTMENT OF AGRICULTURE IN CONSULTATION WITH

23 THE CONGRESSIONAL OVERSIGHT COMMITTEE ON AGRICULTURAL AND

24 FISHERIES MODERNIZATION (COCAFM) SHALL FORTHWITH REVISE AND

25 REFORM ITS PROCESSING AND APPROVAL PROCEDURES IN ORDER TO SPEED

26 UP THE DISBURSEMENT PROCESS.

27 Thesucceedingsections shall berenumberedaccordingly.


12/39

1 SEC. 3. Repealing Clause. - Republic Act 8178 is hereby amended. All laws, decrees,

2 executive issuances, rules and regulations inconsistent with this Act are hereby repealed or modified

3 accordingly.

4 SEe. 4. SeparabilityClause. - Theprovisions of this Act arehereby declared to be separable,

5 and in the event one or more of such provisions are held unconstitutional, the validity of the other

6 provisions shall notbe affectedthereby.

7 SEC. 5. This Actshall takeeffectthirty (30) daysfromthe dateof itspublication inthe Official

8 Gazetteor in at leasttwo newspapersof general circulation.


13/39

MINUTES OF THE MEETING OF THE COMMITTEE ON AGRICULTURE AND FOOD

HELD ON 09 OCTOBER 2007 AT CONFERENCE ROOMS 14 AND 15 AT 1:30 PM

Rep. Abraham Kahlil B. Mitra - Chairman

Rep. Jeci A. Lapus

Rep. Robert Raymund M. EstrellaRep. Proceso 1. Alcala

Rep. Antonio F. Lagdameo JrRep. Rommel C. Amatong

Rep. Danilo P. LagbasRep. Victor J . Y uRep. Henry Pryde Teves

Rep. Nelson L. Dayanghirang

Rep. L eonila V. ChavezRep. Isidro T. Ungab

Rep. Solomon R. ChungalaoRep. Nicanor M. BrionesRep. Jocelyn Sy-Limkaichong

Rep. Ronaldo V. Singson

The meeting was called to order at 1:50 pm; thereafter, the roll was called. The Bodyapproved the Minutes of the previous meeting.

The Chair presented for the approval of the body the substitute bill that provides for theextension of the utilization period of the Agricultural Competitiveness Enhancement Fund. In the

previous meeting, 02 October 2007, the Committee agreed to consolidate the five (5) measures

regarding the ACEF extension, however, the Secretariat prepared a substitute bill in order to give the

Committee the flexibility to introduce amendments to the bill.

He mentioned that the Bureau of Customs (with prompting from the Committee) has already

granted the request of the Department of Agriculture to credit the MAV collections amounting to P4.1B to Special Account 183. On the other hand, he explained that the Bureau of Treasury has to certify

that the funds have already been transferred to the account and available for utilization.

He informed the body that the Committee on Rules has cancelled all committee meetings forthe day in order for all House members to attend the plenary sessions; however, he decided to push

thru with the Committee's meeting because of the urgency of the bill.

The Chair presented to the members the substitute bill prepared by the Secretariat. The Bodyaccepted the measure; however, an amendment was made to it by inserting a new section to read as

follows:

"SEC. 2. The Department of Agriculture in consultation with the Congressional OversightCommittee on Agricultural and Fisheries Modernization (COCAFM) shall forthwith revise and

reform its processing and approval procedures in order to speed up the disbursement process. "

The Chair directed the Committee Secretariat to prepare the Committee Report together withthe amended substitute bill. He instructed the Secretariat to route the same together with the

Signature page for the Committee Members to sign and signify their approval of the measure.


14/39

A motion was duly made and seconded to make all Members present as additional co-authors.The Chair instructed the Secretariat to include Rep. Ma. Victoria R. Sy-Alvarado as additional co-author to the measure.

~k-1J,a~CONSUELO T.ALCIDSupervising Legislative Staff Officer I

1a~fj'HCommittee Secretary

~ABRAHAM KABUL B. MITRA

Chairman


15/39

H.No.6436

s. No. 1450

-Begun and held tn Metro ManU~, on Mdnday. the twenty-

fourth day of~, ~ hundred andnInety-fiva

AN ACTRBPLACING QUANTITATIVE IMPORTRESTRICTlONSON AGRICULTURAL PRODUcrs,EXCBPT RICB, WITH T~IFFS, CRHATING

THE AGRIC'lJLTURAL COMPETITIVENESSBNHANCEMENT FUlID, A .i'4.D POR OTHERPURPOS.ES .

Be it enacted by the StMte and llouse of Represenuuivu of t1uPIailippiJ1a in em"as membled:

SEcrION 1. Tith..- Thia Act shall be kaoW1l as theAgrk:a1tDrJ 1 Ttriffieerian 1\4.,

SEe..2. ~tf Polky.'. it is the po1icyOf theSbltCto .mabt1Ie c:01 I D t.rY a ~.eettor via1*. cffident adgtobaJlyeom.petidve.ThcStale adopta the use of tariffs m Heaofaoe-tariff import restrictiou to pratoct local produan .pa1taral

pro~ except ill the C8$C of rkC,whicl1 win continue to havequaM tative import reStric:tioaa.

Consistent with the ~oml1 mandate of protectiDgPiI ipi:Dofirms against ufair trade it is furthcrinore the paIky of


16/39

_Tel help the agriCil ltUral.seetor. cOlX lpetcglobally. the Stateshall se::ek to raise farm prodnctivil:'lle'!els by pfc"iding the-

necessary support services such as. but not llidted to. irrigation.farm-(o-market roads. post~harvC8tequipcem aL d facilities, credit;research and development. extension services. other marketinfrastrllCture 2nd market information.

- - -

SEC. 3. L?efinition of Temrs. The following definitions~1y t~~~ t~-~ ~.:u.~h.~

(a) IIAgriculnJ:ial produds" shan have 'the same meaniag asagricultural products under Ch.apters,1-24 of Presidential DecreeNo. 1464. otherwise known as the Tariff and CUstoms Code of the

_Pln1ippines. as amended. -

(b) "Appliedrate" is the ~e ofimport duty that is actua11yused by Customs authorities i9lf t~: c;ollccdon. of ClInomsrevel1:ues.

(e) "Boundrate~fefers to'iIia:Uilmn J imitson.t8riffs onprodueucomWtted bythctPhilippines:to the World-TradeOrga:niraticm:(WI'Q) \indet the UrugUay Round PhIal Act

(d) ''In-Quota Tariff Rate" refers fa the tariff tates-form-j.iuwn acceas volnlDes committed by the PhiJ ippmes-to theWorld Trade OrganiZlJtion (W1'O) under the UruguayRoundFinal Act' -

- (e) ~um,Acccss Volqmc" refers to'the volume of aspecific agricultu'ral prodUct ~ i s 8llowed to be imported with alower tariff as coinmitted by the Philippincs'to the World-Trade-~~~)underthcU~-RoUDdF'.malAet --

',~:-~(ij-~o.l~iitativeimp,m-lt~tef~ toilOll-tariffte~t;ictiQIis used. t~!imit the amountof-iiJ lportcd 'commodities,

-iD~dq but,net limited to dis'ctetioDaty biiport JicensiDg ad

impOrt quotas. whether qualified or ~e.

_(g) "Tarift'~e.rs to a tax levied OIl a commodity importedrc',-,another co~. It Wu ~ for the IOVCl'DIIlCllt andrCb,:ded a s iDStrumeats to promote ~'industries by taJ iD gtheir


17/39

(11) BTariffieatiou" refers 'to the lifting of, all'emtingquantitative restricti.ons such as import quotas. or proht"b~~~ns,

imposed on3lcultura1 products. and replac:iDsthese restrictiOnsWitlltariffs. . .' ..' .. "

SEC4. Repe;al." The fonOwt1l3 JAW,! :a .nd all other laws orp.rOriaions of law prcscribiDgquantitativc iiDportrea~ orlfaJltinggo'lerDJDutageuclol the.power to impOcaucllrcst.iic.Qo~on agricultara1prod1lct8~ except 'rice, are hereby~:": '".' ." .., . .::, . , '"

't - .J .' '. ~ ~.

L ~~:'.'.(i)"~Act No.12%,CztroeJi: "'AnAd.~~ the. Importatioa of0Jri0as, Potatoes, Gar.lU;and Cabbaps,.l!'rt.ept fOr

SeedliDg Purposes. and to Provide PenA lties for ~ V iolationTbcteof";; . "

." .' .~, .. . ' f.: .. '.;,,"

Im~~~~ No,27~~e,ntit1ed:AnAd~.~ ~.

':', "'l("; ", .,'

..(3)hCsidcntial Decree No; 1297, asuCD.d~:Gtitled; .Bcentralizing thelmportatioa of R.utiuuufor Breeding,SJ a'lgbtcr and Beet; . .. - '.. _.

. \

/. (4) Pat'~6f&,h19ofSe.;ti0Jl23 of Republic AC;No~7607,eot1tlcd=BA n A ct ProvidiDs a Mapa Caztaf.S1IUI11 ~.

. . . .t~.:.. ~.:.

'. (5) Paragraph (a) of Section 15of Republie A ct.No;.eDW ecJ : "SeedIndustryDewJ opmatA ct:'~ ". '~ ; : D ~ ' / '

'..(6). Seetion4 of Ropublic Act No~.41SS, u,~clod., ..' '.ea@kd= "A nA atoPrc:iiDOte _ StreDgthcathe'VirPda Tobacco

..-....,ad ...," '--.1, ':


18/39

"'SEC.6. (a) P < ? W e T S . -

'(xii) To. ~tabliSh :rules aDdreplatioDl govel'lliag theimport:atiouOt~u4 toJiccme,impOtc,aacl coJIcct.fe"bd '-,char~ for'Sai4~~portatioa for~ ~'of equ6iie, thesdIiag price ofsich~ rite Wida arprcvai1iaademitpriCes.' .

. ~. ,- -. . .. ..;.~.-:. . -, ":I a - d I e aer~:.~.power. tko-tiJ ~ion

wit1l.dre'Ofliceot~ ..~'sJaaJt fiattertifJ to ofriee,"-y()etai arcAk:ofadort-faU prod'actioD crida1;~ P ,. altate;of ~ oroW:r veritWreaaa.s:that miJ.:'warraat tJae~_4'_:impOttaIima::PnniM4'"-.,. ~.""~sWaot:applrtotlae-iDaportItioa of

'rice ,~.~ tile. Miui'PDM'-Aa:alVOiame oNipdon' .:the ~'PlUlfP.piD~.UG~r tJte- wr.o. ',:TM AatJaority .1aaU_~~._w..:...I.L... = -. . . . . . . . . . 01 .,:' ....- : - - . . t .~SU;UD'~ --..-_.: ncc."CJI' ..aaay .-aw..ru

. quotu '~OAI' certified and. licen$cd: _porter wtJle..~ dIa~tIrilaPcooper . .-_ otUr -btmschan_:1t J'Ik* tll be:~ . dieCouadJ rcprdIaa ofajsDg-'~ pricesadtJaeIIIbIidy the.rcotif IIIJ.w1le bonotJ,-tkNIijaDal~""'.

" .

SSC;-6.. Tllli/JktlliiJ&;~1Alieu of,qvjmtjtatiY e tcItridioIIS. . ,., j",-bouad rates;commiUld UDderthe tJ npaJ Roaa4 .~lAcUItaJI_~cI;oia ,tJ ackapiculhJnl procIactanosecpueitamcreatridioJUlIPCPCaJeclbj'tJaia Ad..' -q.e PreaideDl

d ahaI dae COIf~d"m,.iffs tv:cinPiq.1996 up to 7caJ2000: Prrwidd, ''ltittbi~sckdlIIcol1bc idia1 adfiDal appIiecIratea,J iballbe' couiatut witJt.lJat< co_tIT. tariff bU uI iD a _ coprmitmcpts .

",7 :- '-

.. ..~.cuo of ~ort or ablaoraal,rica iac:Aacaia..~ procIudI, reacridiou J i ltccl .

. __ daisAd, the?zaidcat. 'IDIt1 P'''' toCoapaa. ~. -aodificaticmaor a4jutmenca :Ofau)." _AccaI VoI8ae.(MA V):--borhW, hMwrr, ,TIat ill die c1aIt CoaFea fai1ItO,ad'-atrz 1ifteea (15) daysfrom receipt.'of die I J f C J P 'U I , rite shaIl1le~~" .-

\

SE e . .1. M~ !ortIulntpkmlltbllioJ r ofJl"1II imum'A-cceJs YolullJ e (MAY):; AAcquitablc ad traupucnt"mech'" for alloCatingthe MiDimnm Aa:aa Volume (MAV) fA

. . . ~


19/39

agriadtUral products, wJacuqumtitatie resUidio. are herein. lifted. shall "-developed and.cRaWishe, haY iac the least

'SOY eID II ICDt iDtcrIatiOJ I. .dclr~siDgtJacftilm.~ of "Ch.IcograjWcal .arca, aIlCI without cDl.i'fiaj,.. u, COIt- toiJ DporrcrS/UI CII of tlacse prondato tk:~ of JOQ} 0IMr"'ii:tI. -. ~. .

. ~ s '

.For -tlaia parloR' i1l'1lCCOrdnce widt thaboftllleJItioaed pi4iqt priacipJa,Cal;iact" o--iueccnatedbi~'On1cr ~o. 2llS~ D e. 19Mto .oWIscc ._=y.aaiaiataaaca:.'"'aise-ilel,bJthe ftilippila Uder tie GCDcnl~oa ""'ucl

Trade Unaaa' R01l1lcl ..witllthc jadtaliu oftJl6NatioaalB.C:PJ lomic,~~l)cft1epJaeat Autkority (N$).A),.u4~iJ l

coas1tltatiOA witJ l aUcoaccmcd ..apialtualfarmetlplodDrLJ!III1ff*IOrrmi~ IfOUPI, t1W1 . to

'. eoaan-'" aperiod ofsiIly(fO) -JSlri.ia-,.thisA ct. tJ aeapprOpriate mechnina fortllc,iaplmncntetin ofthemiIim_ aa.as ..

'. ,"8.~,~~Pu4. ..- To illapJ cmal tile poIiq "umadllcd'iIltWsAd; dlcnilllaeby

;aeateCIdlcAJric*unl~. Pah~CIII ~hctciuftcr refcrrcdto.u thePut.nc:~~ ofthe

'"impodldoa of . XCCIS~~ ~.D* GcDtnlPuaIlmdshail be cfcpOIUd ""JfiIionaI1'tcZ. .,. .

. . . ;" .

ftC eJlCir~~.sialfbe:ldaawe" eU- lby .CoJlgrtI&. f.~iDi"'t;d;:__ to-.artet~roaC1s".pOlli,;Uneateqnipoear aacI '" Zia trOcJ il. zeseiIrdl ~. odIa'mark:ctUig iilfrutnrctue; prcmsioa"'-,vl:~iaf aeion,

rcumm" =AM icniccs. aaclatJiCr__ ofusiJtancc aadsuppOd to.tpica1t .t~. ' .

.11Ico-PnucesCJ Il';A piCa1I:iIre ..a:Poed, A ppIopriatioDsIIDd ~ ofbotJ a die Sc:aate _ tlIo-..c ofRcpreICDtativesaha1l~ apc&dic.-. ofdae .,-,:.aM PuDd. 'Tk P\mdsUIl'mca lifC of .~')J i.:ifacr"Wtic:k all la-aiDing..R1at to.GcaeAI PW.

.sse. 9. RqalUtJ :a.a. . AI~4e~ aecutive.vutes., rules udrcphtioD. mug 4rtnat widl thiI Act arc.hcrcbyrepea1cd iIi ~ aceordiDIlJ.


20/39

. .

. SEc. 10. Separability C ltJ u .r e , .~ .1'he provi$ions of thU Act are~ declared to be separabk. and in the event cine or more of

such.provisiOns ~ held uncOnstitolioBat. the validity of the otherpr~~ shallJ lqt~.aff~ ~eby. ....~

.. '.'..-SEC.l!. Eff~~-This:J ict shaUtakedfcct tbi11;y'(30)da}'5~o.n the 'date Of;itspublicatioll in ~ .0jfiQal. Gazette odn atic.-trwo (2) .neMpaperS ofgcnetalclr"i'atiolL .. '.

This A ct whiCh is a co.nso.lidationof Honse Bin No. 6436 and .Senate Bill No. 1450 was finally passed by the Honse ofRepl'csentativesand the Senate on M arch 27, 1996 and M arch26,J 996. respecdV ;eI.y

. Appro'ged: 28 Morch 1996


21/39

FOURTEENTH CONGRESSFirst Regular Session

Republic of the Phiiippme~

HOUSE OF REPRESENTATIVESQuezon City

HOUSE BILL NO. __ 6_ 0_ 7

Republic Act #8178 was signed into law on March 28, 1996. Section 8 of RA #

8178 created the Agricultural Competitiveness Enhancement Fund (ACEF) which wasgranted a life span of Nine (9) years. However. ACEF was not disbursed according to theintended original purpose. Instead, money collected for the ACEF from 1996 to 1998 was

utilized for budgetary support.

There is aneed to extend the utilization period of the ACEF to enable thegovermnent to provide the farming sector the opportunity to use the funds to strengthen

their development activities and enhance their competitiveness. The availability of the

ACEF will relieve farmers of the need of having to secure funds for their competitIveenhancement activities.

Govenunent needs to contitiue to provide the fanning sector the opportunity toprepare for liberalized trade through thejudicious use of theACEF.

This proposed measure tinds support in Section 21. Article II Declaration of

Principles and State Policies of the 1987 Constitution which reads:

Section 21. The State shall promote comprehensive rural development andagrarian reform.

To correct this fatal tlaw, the proposed measure was filed and the proponent seekshis colleagues' assent. It is therefore earnestly requested that this measure be approved

immediately.


22/39

Republic of the Phil ippme:-:HOUS E OF REPRES ENTAT IV ES

Quezon City

FOURTEENTH CONGRESSFirst Regular Session

HOUSE BILL NO. __ 6_07

'AN ACT

TO EXTEND THE UTILIZATION PERIOD OF THE AGRICULTURALCOMPETITIVENESS ENlL


23/39

The entire proceeds shall be set aside arid earmarked by' Congress for:

irrigation, fann-to-market roads, post~harvest equipment and fa~ilities,creditresearch and development, other marketing infrastructure, provision of

market information, retraining,.extension services, MICRO, SMALL AND

MEDIUM SCALE ENTERPRISES (MSMSE) IN AGRICULTURE,

AQUACUL TURE AND FI SHERI ES SECTORS; Y OUNGENTERPRENEURS, OUT-OF-SCHOOL Y OUTH, GRADUATES OFAGRICUL TIJRE, FISHERIES, AND RELATED COURSES.AGRICULTIJRE AND FISHERY COOPERATIVES ENGAGED INECONOMIC ENTERPRISES and other forms of assistance and support to

the agricultural sector.

The Committees on Agricultural and Food, Appropriations and Finance ofboth Senate and the House of Representatives shall conduct a periodicreview of the use of the Fund. The Fund shall [shall have a life of nine (9)years] EXIST UNTIL THE Y EAR 2015, after which all remaining balances

shall revert to the General Fund.

SECTION 2. Repealing Clause. All laws, decrees. executive issuances. rules andregulations inconsistent with this Act are hereby repealed or modified accordingly.

SECTI ON 3. Separability Clause. The provisions of this Act are hereby declared to beseparable. and in the event one or more of such provisions are held tUlconstitutionaL thevalidity of the other provisions shall not be affected thereby.

SECTION 4. This Act shall take effect thirty (30) days from the date of its publication in

the Official Gazette or in at least two (2) newspapers of general circulation.


24/39

Republic of the PhilippinesHOUSE OF REPRESENTATIVES

Quezon City, Metro Manila

Fourteenth CongressFirst Regular Session

1402

.,

EXPLANATORY NOTE

In March 1996 during the 10th Congress, Republic Act 8178 or the AgriculturalTariffication Act was signed into law. One of the notable aspects of this law was thecreation of an Agricultural Competitiveness Enhancement Fund (ACEF) to help thefanning sector remain competitive amid the country's free trade commibnent under theWorld Trade Organization (WTO); particularly by ensuring that money will be made

available for such purposes as irrigation, farm-to-market roads, post-harvest equipmentand facilities, credit, research and development, other marketing infrastructure, provisionof market information, retraining, and extension services. The sole source of funding forACEF, as per RA 8178, was tariff collections from all imports under t4e MinimumAccess Volume scheme, which was also defined in RA 8178.

However, Section 8 of RA 8178 specifically provided that ACEF will only have alifespan of nine (9) years, after which, all remaining balances shall revert to the GeneralFund. That nine-year lifespan expired in March 2005, leaving what remains of the fundlargely unutilized. As of December 2005, reports showed that a total of P5.819B wasremitted to the Bureau of Treasury for ACEF. Of this amount, P2.768B was alreadyutilized for various relevant projects, leavingan unutilized portion ofP3.06B.

Three billion pesos is no small amount for a fledgling ecpnomy like ours, stillbeset with issues of recurring fiscal deficit and shortage of funding support fdr such avital sector as agriculture. Congress needs to act, and assure that this amount will remainintact, and shall continue to be utilized for reasons it was proposed and collected in thefirst place. This can be achieved by amending Section 8 of RA 8178, which is theprimary intent of this bill.

ACEF was conceived specifically to support the local farming sector, and itwould be a inappropriate, even morally wrong, to have what remains of this fund utilizedfor other purposes. Our farming sector needs, in fact, it deserves, every cent of whatremains of ACEF.

I thus urge my colleagues in the 14th Congress to consider and approve this billwith dispatch.


25/39

Republic of the PhilippinesHOUSE OF REPRESENTATIVES

Quezon City, Metro Manila

F O U l' teebth CongressFitst Regulaf Session

1402

A N ACTTO EXTEND THE UTILIZATION PERIOD OF THE AGRICULtuRAL

COMPETITIVENESS ENHANCEMENT FUND,AMENDING REPUBLIC ACT NO. 8178, ENTITLED "AN ACT REPLACING

QUANTITATIVE IMPORT RESTRICTIONS ON AGRICULTURAL PRODUCTS,EXCEPT RICE, WITH TARIFFS, CREATING THE AGRICULTURAL

COMPETITIVENESS ENHANCEMENT FUND, AND FOR OTHER PURPOSES"I

Be it enacted by the Senate and House of Representatives of the Philip~ines in Congressassembled:

Fund. [The proceeds of] THE FUND SHALL CONSIST OF ALL DUTIES

COLLECTED FROM the importation of AGRICULTURAL PRODUCTS

LOAN BENEFIClMUES INCLUDING INTERESTS, IF ANY . THE FUND

SHALL BE AUTOMATICALLY CREDITED TO SPECIAL ACCOUNT 183


26/39

IN THE GENERAL FUND OF THE NATIONAL TREASURY .

The entire proceeds shall be set aside and earmarked by Congress for irrigation,

,Itldi. ~.. ~ aM ,.,,\ties. ere&t. tesearcll and

(MSMSE) IN AGRICULTURE, AQUACULTURE AND FIS~RIES SECTORS;

Y OUNG ENTREPRENEURS, Ou::r-OF-SCHOOL YOUTH, GRADUATES OF

AGRICULTURE, FISHERIES AND RELATED COURSES; AGRICULTURE

AND FISHERY COOPERATIVES ENGAGED IN ECONOMIC ENTERPRISES

SEC. 9. OVERSIGHT COMMITTEE - AN OVERSIGHT COMMITTEE IS

HEREBY CREATED COMPOSED OF FIVE MEMBERS EACH FROM THE

SENATE AND THE HOUSE OF REPRESENTATIVES TO MONITOR AND

EVALUATE THE IMPLEMENTATION OF THIS ACT.

THE CHAIRPERSONS OF THE COMMITTEES ON AGRICULTURE

AND FOOD OF THE SENATE AND THE HOUSE OF ~PRESENTATIVES

SHALL BE THE CHAIRPERSON AND CO-CHAIRPERSON, RESPECTIVELY ,

OF THE OVERSIGHT COMMITTEE: PROVIDED, THAT THE MINORITY IN

THE SENATE AND THE HOUSE OF REPRESENTATIVES SHALL BE

ENTITLED TO NOT LESS THAN TWO SEATS EACH IN THE OVERSIGHT


27/39

COMMITTEE.

THE OVERSIGHT COMMITTEE SHALL BE PROVIDED WITH THE

NECESSARY FUNDS TO CARRY OU T ITS DUTIES RELATED TO THE

PERFORMANCE OF ITS FUNCTIONS AS PROVIDED HEREIN.

The succeeding sections shall berenumbered accordingly.

SEC. 3. Repealing Clause. - All laws, decrees, executive issuances, rules and regulations

1l1c ottsistel1t w ith this Act are hereby repeal~d or modified accordingly.

. SEC. 4. Separability Clause. - The provisions of this Act are hereby declared to be

separable, and in the.event one or more of such provisions are held unconstitutional, the validity

ofthe other provisions shall not be affected thereby.

SEe. 5. This Act shaH take effect thirty (30) days from the date of its publication in the

Official Gazette or in at least two newspapers of general circulation.

Approved,


28/39

3B.epubH c of tbt ~~Uippine

HOUSE OF REPRESENTATiVES

4aut?on lit!'

r-OURTlEEN73-& CO~~GR1E:$

F irst R egular S ession

1517

Introouced by HONORA~UE LUIS R..V:Il~FQJ ERTeTHON.ORABLE DIOSDADO MACAPAGAL ARROY O, HONORABLE

FERDINAND MARTIN G. ROMUALDEZ

Republic Act No. 8178 replaced with tariffs the quantitative importrestrictions on agricultural products except rice wllicl1 wiil continue tohave quantitative import restrictions.

In order to assist the agricultural sector to compete globally, thegovernment envisions a program to raise 'farm productivity levels byproviding the necessary support services such as, but not limited to,irrigation, farm-to-market roads, post-harvest equipment and facilities,credit, research and development, extension services, other market

infrastructure and market information."

To implement the policy enunciated in RepUblic Act No. 8178, theAgricultural Competitiveness Enhancement Fund (ACEF) was created fromout of the proceeds of the minimum access volume of importation ofagricultural products subject to the tarif{1cation poHcy.

The duration for said fund is eleven (11) years, which means that

the law enacted in 1996 will lapse this December, 2007. This duration isinadequate for the purposes, RA 8178was enacted. There is a lot of workyet to be done throughout the country, and our agriculturai sector is stiil

very much in need of the development and benefits that the fund allowsfor. Irrigation, farm-to-market roads, post-harvest equipment andfacilities, credit, and research and development are ail still pressing needs

in our nation's countryside. There are in fact other pressing needs of ouragricultural, aqua-cultural and/or fisheries sectors that must be addressedand should also be given priority.

The duration of the ACEF needs to be extended, as mcmy of ourfarmers have yet to benefit in more meaningful ways from the projects

and services it finances. This bill proposes an extension of the effective


29/39

period of this fund that allows for an extended time for the availment ofthe benefits therefrom. Furthermore, this bill intends to ensure that the

most deserving only of the benefits of A C E F will avail of itby making thepreferred lending to micro-, small-, and medium-scale enterprises

(MSME) in the agricultural and aqua-cultural sectors including technology

transfer assistance, and limiting the lending to large-scale entities inthese sectors to not more than 15% of the ACEF.

Thus, this bill proposes the extension of the ACEF to 2015, for anaddition of eight (8) more years, for a total duration of nineteen (19)years from the original start-up date of the fund. This extension willprovide a necessary lifeline for our agriculture, aquaculture and/orfisheries sector at the crucial period of adjustment to a more competitiveinternational environment, and may well prove to be the very instrumentthat ensures levels of global competitiveness of our agriculture,aquaculture and/or fisheries sector.

To finance the ACEF, this bill also amends Section 6 of RA 8178,allowing the President of the Philippines to impose the tariffs provided insaid Act from 2004 to 2015. The original tariffs, as provided, were to beimposed by the President only from 1996 to 2000. It would not work aseffectively to extend the life of the ACEF for the purposes merely ofallowing the use of its remaining funds, but more importantly, additionalfunding source must be provided by an extension of the power to imposethe allowable tariff on the importation of the minimum access volumesindicated in RA 8178.

In this era of globalization, we must, as a nation, take thenecessary steps to make our sectors and industries viable, stable" andcompetitive. In light of the foregoing purposes, the immediate enactment

of this bill is highly recommended.

~DIOSDADO MAC~AGAL ARROYO


30/39

l\.epublit oftbt ~btltppint~

HOUSE OF REPRESENTATIVES

aue?on :itp

FOURTEENTH CONGRESS


HOUSE BILL NO. 151 7

Introduced by HONORABLE LUIS R. VILLAFUERTE,HONORABLE DIOSDADO MACAPAGAL ARROYO, HONORABlf

fERDINAND MARTEN G. RO~~UAlDlEZ ' .

AN AC.TO EXTEND THE UTILIZATION PERIOD OF THE AGRICULTURAL

COMPETITIVENESS ENHANCEMENT FUND, AMENDING SECTION 8

OF REPUBLIC ACT NO. 8178, ENTITLED "AN ACT REPLACINGQUANTITATIVE IMPORT RESTRICTION ON AGRICUL:ilURAlPRODUCTS, E)(CEPT RICE, WITH TARIFFS, CREATING THE

AGRICULTURAL COMPE rnlVENESS ENHANCEMENT FUND, AND

FOR OTHER PURPOSES"

Be it enacted by the Senate and House of Representatives inCongress assembled:

SECTION 1. Section 8 of Republic Act No. 8178, entitled "An ActReplacing Quantitative Import Restriction on Agricultural Product, ExceptRice, With Tariffs, Creating the Agricultural Competitiveness EnhancementFund and for Other Purposes" is hereby amended to read as follows:

SECTION. 8. Agricultural Competitiveness EnhancementFund. - To implement the policy enunciated in this Act, there

is hereby created the Agricultural Competitiveness

Enhancement Fund, hereinafter referred to as the Fund. [The

proceeds of] THE FUND SHALL CONSIST Of All DUTIES

COLLECTED FROM the importation of AGRICULTURALPRODUCTS UNDER THE minimum access volume (MAV)

[shall accrue to the General Fund and shall be deposited wIth

the National Treasury.) MECHANISM, INCLUDING UNUSEDBALANCE AND COLLECTIOi~S FROM REPAVrJ iENTS FR014LOAN BENEFICIARIES INCLUDING INTERESTS, IF ANY,

THE FUND SHALL BE AUTOMATICALLY CREDITED TOSPECIAL ACCOUNT 183 IN THE GENERAL FUND OF THENATIONAL TREASURY.


31/39

Theentire proceedsshall beset asideand earmarked by

Congress for: irrigation, farm-to-market roads, po st-harv@ stequipment and facilities, credit, research and development,other marketing infrastructure, provision of marketinformation, retraining, extension services, MICRO, SMAll

AND MEDIUM SCALE ENTERPRISES (MSMSE) INAGRICULTURE, AQUACULTURE AND fISHERIES

SECTORS; YOUNG ENTREPRENEURS, OUT-Of-SCHOOL

YOUTH, GRADUATES Of AGRICULTURE, fISHERIES,

AND RELATED COURSES; AGRICULTURE AND fISHERY

COOPERATIVES ENGAGEDIN ECONOMIC ENTERPRISES

and other forms of assistanceand support to the agriculturesector.

The Committees on Agriculture and Food,

Appropriations and Financeof both Senate and the House ofRepresentatives shall conduct a periodic review of the use ofthe Fund. The Fundshall [have a life span of nine (9) years]EXIST UNTIL THE YEAR 2015, after which all remainingbalancesshall revert to the General Fund.

SEC. 2. Repealing Clause. - All laws, decrees, executive issuances,rules and regulations inconsistent with this Act are hereby repealed ormodified accordingly.

SEC. 3. Separability Clause. - The provisions of this Act are hereby

declaredto be separable, and in the event one or more of suchprovisionsare held unconstitutional, the validity of the other provisions shall not beaffected thereby. ..

SEC. 4. Effectivity. - This Act shall take effect thirty (30) days fromthe date of its publication in the 0ff!cial Gazette or in two (2) newspapersof general circulation. I


32/39

Republic of the Philippines

HOUSE OF REPRESENTATIVESQuezon City, MetrQ Manila

FOURTEENTH CONGRESSFirst regular session

House Bill 1521Introduced by: HONORABLE DARLNENE R. ANTONINO-CUSTODIO

This bill seeks to extend the utilization period of the Agricultural Competitiveness

Enchancement Fund (ACEF) established under Republic Act No. 8178 from 2005 to

2~15, amending for the purpose the said Republic Act.

The commitment of the Philippines to international cooperation paved the way to

its becoming a signatory to the General Agreement on Tariffs and trade (GAIT) and its

membership in the World Trade Organization (WTO).

Under the Uruguay Round, we agreed. to open our agricultural markets to otherWTO member-eountries, promising, among others. a zero percent (0%) tariff rate on allagricultural products by 2004.,.

To fulfill this commitment, Congress passed. Republic Act No. 8178 on March 28.

1996 to among others-repeal seven (7) existing laws that either prohibited importation

of agricultural products, or subjected such importation to stringent conditions.Thus.almost all agricultural products are now imported liberally into the country.

Aware that opening up the local market to agricultural imports would place our

farmers at a disadvantage. RA 8178 also provided for a gradual tariff quota scheme.

Under this scheme, the government has reduced the tariff rates for agricultural imports on

a yearly basis until it reaches 0% by the year 2004. This Tariff rate Quota (IRQ) schemeoperates by imposing a ceiling on the volume of specified agricultural imports.

Agricultural products imported within the ceiling enjoy a reduced tariff rate,

compared to those imported in excess of the ceiling.

For instance. a total of 1,000 tons of beans are imported into the Philippines 300

tons being the ceiling of these, 300 tons will enjoy a tariff rate of 35% while the

remaining 700 tons will be subjected to atariff of 80%.

This 35% rate is called the In-quota tariff. The 80% rate is the out-quota tariff.

The ceiling imposed on the product is called the Minimum Access Volume (MA V).

But lowering the tariff rates for a certain volume of agricultural products also

means lowering their competitive prices. This places local farmers at a district

disadvantage. Thus RA 8178 further attempted to provide a solution: funds generated by


33/39

the in-quota tariffs would be pooled under the Agricultural Competitiveness

Enhancement Fund (ACEF).

According to official records, however, the in-quota duties of MA V tariffcollections of the Bureau of Custo~ from 1996 to 1998. were not credited by the

Bureau of Treasury to the ACEF account, or Fund 183. Moreover, from 1999to 2000, theBureau of Customs claims to have collected an amount of only P250 Million out of anestimated collection target of PI. 73 Billion, based on the actual MA V licenses issued bythe Department of Agriculture.

Congress was to have earmarked the ACEF funds for farm-to-market roads,

irrigation facilities, and other projects, supposedly to cushion the adverse impact on ourfarmers of the availability of cheap agricultural imports. However, a subsequent

Administrative Order 39, issued in 1999, provided that funding for farmers' project be

subjected to the stringent requirements of the ACEF Executive Committee.

And yet, even if a project was approved by the Committee, funds were not made

readily available, but subject to the tight schedule of the Department of Budget and

management (DBM).

As a result, utilization of the ACEF fund has been very low. Only P447 Millionpesos had been released thus far under the regular ACEF in 1999 alone. Customscollections amounted to Pl.3 Billion.

Then too, a provision in RA 8178 limits the ACEF to a life of only nine (9) years.

This means that the revenue collections generated for the ACEF account will revert to thegeneral Fund by the year 2005.

There is an urgent need, therefore, to extend the utilization period of the ACEF to

allow government to continue providing assistance that will enable farmers to survive,and perhaps prosper, under a liberalized trade regime.

Since low funds utilization defeats the very purpose for which the ACEF was

established, there is also an equally compelling need to assure that assistance from theACEF is made more accessible to farmers and the agricultural sector as a whole.

In view of the foregoing considerations, immediate approval of this bill is,therefore, earnestly sought.


34/39

Republic of thePhilippinesHOUSE OF REPRESENTATIVES

Quezon CityFOURTEENTH CONGRESS


HOUSE BILL

1521

Introduced by: HONORABLE DARLENE R. ANTONINO-CUSTODIO

AN ACTEXTENDING THE UTILIZATION PERIOD OF THE AGRICULTURALCOMPETITIVENESS ENHANCEMENT FUND, AMENDING FOR THE

PURPOSE REPUBLIC ACT NUMBERED EIGHTY -ONE HUNDREDS ANDSEVENTY-EIGHT, ENTITLED "AN ACT REPLACING QUANTITATIVE

IMPORT RESTRICTION ON AGRICULTURAL PRODUCTS, EXCEPT RICE,WITH TARIFFS, CREATING THE AGRICY ULTURAL COMPETITIVENESSENHANCEMENT FUND, AND FOR OTHER PURPOSES" AND FOR OTHER

. PURPOSES.

Be it enacted by the Senateand theHouseof Representatives of thePhilippines inCongress assembled

SECTION 1. Section 8 of Republic Act No. 8178, entitled " AN ACTREPLACING QUANTITATIVE IMPORT RESTRICTION ON AGRICULTURAL

PRODUCTS, EXCEPT RICE, WITH TARIFFS, CREATING THE AGRICULTURALCOMPETITIVENSS ENHANCEMENT FUND, AND FOR OTHER PURPOSES" ishereby amended, toread as follows:

"Section 8. Agricultural Competitiveness Enhancement Fund Toimplement the policy enunciated in this Act, there is hereby created theagricultural Competitiveness Enhancement Fund, hereinafter referred to as theFund. [ The.proceeds of] THE FUND SHALL CONSIST OF ALL DUTIESCOLLECTED FROM importation of AGRICULTURAL PRODUCTSUNDER THE minimum access volume (MAV) [ shall accrue to the GeneralFund and shall be deposited with the National Treasury] MECHANISM,INCLUDING UNUSED BALANCE AND COLLECTIONS FROMREPAYMENTS FROM LOAN BENEFICIARIES INCLUDINGINTERESTS, IF ANY . THE FUND SHALL BE AUTOMATICALLYCREDITED TO SPECIAL ACCOUNT 183 IN THE GENERAL FUND OF

THE NATIONAL TREASURY .


35/39

The entire proceeds shall be set and earmarked by Congress for: irrigation,

fann-to-market roads, post-harvest equipment and facilities, credit, research and

. development, other marketing infrastructure, provision of market information,retraining, extension services,. MICRO, SMALL AND MEDIUM SCALEENTERPRISES (MSMSE) IN AGRICULTURE, AQUACULTURE ANDFISHERIES SECTORS; Y OUNG ENTERPRENEURS, OUT -OF-SCHOOL

Y OUTH, GRADUATES OF AGRICULTURE, FISHERIES, ANDRELATED COURSES; AGRICUL TURE AND FISHERYCOOPERATIVES ENGAGED IN ECONOMIC ENTERPRISES and otherforms of assistance and support to the agricultural sector.

The Committed of Agriculture and Food, Appropriations and Finance of

both Senate and the House of Representatives shall conduct a periodic review of

the use of the Fund. The Fund shall [ have a life of nine (9) years] EXISTUNTIL THE Y EAR 2015, after which all remaining balances shall revert to theGeneral Fund.

SEC.2. This Act shall take effect Fifteen (15) days after its publication in the

Official Gazette or in at least two (2) newspapers of general circulation.


36/39

Republic of the PhilippinesH O U S E O F R E P R E S E N T A T I V E S

Quezon City

F O U R T E E N T H C O N G R E S S

FirstRegu lar Session

House Sil(No. -~2-470

Introduced by M A . C A R I S S A O . C O S C O L L U E lA ,R ENE M . VEL A R D E , a nd W IllI A M IR W IN C . T IENG

T he A gricu ltura l C ompe titiveness E nhanc eme nt F un d (A C E F ) wa s created throu gh

R epublic A ct No. 8178 (R.A. 8178), entitled "An Act R eplacing Quantitative ImportRestrictions on Agricultural P roducts, Except Rice, With Tariffs, Creating the Agricultural

.Competitiveness Enhancement Fund.- This fundconsists of in-quota tariffs collected fromthe importation of Minimum Access Volumes (MAVs) of agricultural and fisheries products.

T he entire proceeds wil l be earma rked for irrigation, farm-to-marke t roads , post-ha rvestequipment and facilities, credit, rese arch and de velopment extension s ervices, and otherforms of B$Sistanceand support to the agricultural and fisheries sector.

On December 21, 2007, the balance of the A C E F is set to revert to the G eneralFund, as mandated under Section 8 of R.A. 8178. Considering that our farmers andfisherfolk still belong to the most soci


37/39

Republic of the PhilippinesH O U S E O F R E P R E S E N T A T I V E S

Quezon City

F O U R T E E N T H C O N G R E S SFirst Regular Session

House Bill No. 2470

Introduced by M A . C A R I S S A O . C O S C O L L U E L A ,R E N E M. V E L A R D E , an~WlWAM IRWIN C . T IENG

A N A C T

E X T E N D I N G T H E U T I L I Z A T I O N P E R I O D O F T H E A G R I C U L T U R A LC O M P E T IT IV E N E S S E N H A NC E M E N T F U N D, A M E N DIN G F O R T H IS

P U R P O S E S E C T IO N 8 O F R E P U B L IC A C T N O . 8178, E N T IT L E D"A N A C T R E P L A C IN G Q U A N TIT A T IV E IM P O R T R E S T R I C T IO N S O N

A G R IC U L T U R A L P R O D U C T S , E X C E P T R IC E , W IT H T A R IF F S ,C R E A T I NG T H E A G R IC U L T U R A L C O M P E T IT IV E N E S S

E N H A NC E M E N T F U N D," AN D F O R O T H E R P U R P O S E S

B e i t e n a c t e d b y t h e S e n a t e a n d t h e H o u s e of Representat ives of the Ph i lipp ines inCongress assembled:

1 SE CT ION 1. Section 8 of R epublic Act No. 8178, entitled "An Act Rep lac ing

2 Q uantitative Import R estrictions on Agricultural P roducts, E xcept R ice, with Ta riffs, C reating

3 the AgriC Ultural C ompetitiveness E nhancement F und, and for other P urposes, is hereby

4 amended to read as follows:

5 SEC . 8 . Agr icu l tura l Compet i tiveness Enhancement Fund. - To implement

6 the policy en unciated in this Act, there is hereby created the A gricultural

7 C ompetitiveness E nhancement F und, hereinafter referred to as the F und.

8 T H E F U ND SH A LL C O NS IS T O F A LL D U TIE S C O llE C T E D F R O M [T he

9 proceeds oij the importation o f AGR ICULTUR AL PR ODUC TS UNDER

10 THE min imum access vo lume (MAV) MECHANISM, TO BE CREDITED TO

11 A S P E C I AL A C C O U NT IN TH E G E N E R A L F U ND O F T H E NA T IO NA L

12 TR E AS UR Y . [shall accrue to the G eneral Fund and shallbe deposited in

13 the national Treas ury.]

14 Th e fU N D [en~re proceeds ] s h a l l C O N T IN U E T O be se t a side [and


38/39

earmarked by C ongress] AS F O LL O W S : [for irrigation, farm to market

roads, post-harvest equipment and fac ili ties, c redit, research and

development, other marketing infrastructure, provision of market

information, retraining, extension services, and other forms of assistanceand support to the ag ricultural sec tor.]

1) E I G H T Y -F I V E P E R C E N T (85% ) F O R A G R I-B A S E D P R O D U C T I O N

AND P OS T P R ODU C TION AND .P RO C ES S ING AC T IV IT IES , INC LUD ING

B UT NO T L IM IT E D T O N E W E X P O R T IND U S TR IE S A ND A G R I-

R E LA TE D INF R AS T R UC T UR E A ND E Q U IP M E NT T O A C HIE V E

M O DE R N A GR IC U LT UR AL P R AC T IC E S ; A ND F O R P U BL IC

IN F O R M A T IO N A N D P R O M O T IO N A C T IV IT IE S , IN C L U D IN G T H E

E S T A B LIS H M E N T O F A P R IN C IP A L M E C H A N IS M T H E R E F O R T O

P R O M OT E T HE D ES IR E D A G R IC U LT UR A L P R O DU C TS A ND

A C T I V IT IE S A N D C R E A T E N E W M A R K E T S ; A N D

2) F IF T E E N P E R C E N T (15% ) F O R R E S E A R C H , D E V E L O P M E N T , A N D

T H E C O M M E R C IA L IZ A T IO N O F S U C H , IN C L U D IN G T H E U P GR A D IN G

O F T H E R E S E A R C H F A C I LIT IE S O F Q U A L IF IE D U N IV E R S IT IE S A N D

C O L L E G E S .

19 The Committees on Agriculture and Food, Appropriations and Finance of20 both the Senate and House of Representatives shall conductAN ANNUAL

21. [ a pe riodic] review of the us e of the F und. The F und shall have a life of U P

22 TO TH E Y E AR 2015 [nine (9) years], after which T HE [all] remaining

23 balancerS] shall revert to the G eneral F und.

24 S e c . 2 . Fund Management and Sustainabil ity. - For the purpose o f fund

25 management, the F und s hall be dep osited to the land Bank of the P hilippines (LBP ). The

26 Dep artment of A griculture and the LB P are hereby mandated to draw up a plan that shall

27 allow regional application, processing and release of the fund to local farmers and such

28 other mechanisms for fund utilization and sustainability.

29 Sec. 3. P ub l i c In fo r ma t i on . - The Department of Agriculture (DA), in coordination

30 with the P hilippine Information Agency (P IA) and the Department of Trade and IndUStry

31 (DT I), shall ens ure the proper information diss emination of this A ct, inclUding administrative

32 orders and/or implementing r u l e s a nd regUlations promulgated for the utilization of the F und ,

33 to the ge neral pu blic, esp ecially its intende d be neficiaries.


39/39

1 S ec. 4. Re pea l i ng C lause . - A ll laws, decrees, orders, rules a nd regulations or other

2 issuan ces or parts thereof inconsistent with the provisions of this Act are hereby repealed or

3 modified accordingly.

4Sec . 5 . Separab i l it y C lause . - If any portion or provision of this Act is declared

5 unconstitutional, the remainder of this Act or any provision not affected thereby shall remain

6 in force and effect.

7 See. 6. Effectivity. - This Act shall take effect after fifteen (15) days following the

8 completion of its publication either in the O fficial G azette or in a newspaper of general

9 circulation in the P hilippines.

10 Approved,

Cttee. Report No.79

Documents

Transcript of Cttee. Report No.79