WHEREAS,
Presidential Decree No. 961 was promulgated to promote the development
of the coconut and other palm oil industry and to ensure that the
coconut farmers become direct participants in, and beneficiaries of,
such development; chanroblesvirtualawlibrary
WHEREAS, there is a need to restructure the provisions of Presidential
Decree No. 961 in order to meet the changes of the times and to provide
more effective means of achieving the objectives of the coconut
industry as expressed in said Decree;chanroblesvirtualawlibrary
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of
the Philippines, by virtue of the powers vested in me by the
Constitution, do hereby decree and order the following:cralaw:red
ARTICLE I
TITLE AND POLICY OF THE STATE
Section 1. Title. — This Decree shall be known as the
"Revised Coconut Industry Code".
Section 2. Declaration of Policy. — It is hereby
declared to be the policy of the State to promote the rapid integrated
development and growth of the coconut and other palm oil industry in
all its aspects and to ensure that the coconut farmers become direct
participants in, and beneficiaries of, such development and growth.
ARTICLE II
Section 1. Creation of a Philippine Coconut
Authority. — To implement and attain the declared national policy,
there is hereby created an independent public corporation to be known
as the Philippine Coconut Authority, hereinafter referred to as
Authority, directly reporting to, and supervised by, the President of
the Philippines.
Section 2. Principal Office. — The Authority shall
maintain its principal office in the Greater Manila Area but it may
establish branches and agencies within the Philippines as may be
necessary for the proper conduct of its business.
Section 3. Power. — In the implementation of the
declared national policy, the Authority shall have the following powers
and functions:cralaw:red
a) To formulate and adopt a general program of
development for the coconut and other palm oil industry in all its
aspects;chanroblesvirtualawlibrary
b) To formulate and implement a nationwide replanting
program using precocious high-yielding hybrid seednuts and, in the
discretion of the Authority, the program may include new areas provided
that existing coconut farmers shall always be given priority;chanroblesvirtualawlibrary
c) To distribute, for free, to coconut farmers the
hybrid coconut seednuts herein authorized to be acquired;chanroblesvirtualawlibrary
d) To review and revise, and thereafter integrate
into the adopted general Program of development, the existing policies,
projects and activities of all other governmental agencies directly
relating to the development of the industry;chanroblesvirtualawlibrary
e) In coordination with the hybrid coconut seed farm
herein authorized to be established, to conduct genetical and
agricultural researches and investigations for the improvement of the
coconut palm productivity;chanroblesvirtualawlibrary
f) To establish, operate and maintain one central
experiment station and such sub-stations as it may prescribe, to
undertake extensive research in the control and eradication of coconut
diseases and pests and in the method of making copra; and in connection
therewith, all research stations and centers, facilities and equipment
operated by any governmental agency or instrumentality in the
researches on genetical, agronomical and disease control relating to
coconut culture are all hereby transferred to the Authority;chanroblesvirtualawlibrary
g) To explore and expand the domestic and foreign
markets for coconut products and by-products;chanroblesvirtualawlibrary
h) To regulate the marketing and the exportation of
copra and its by-products by establishing standards for domestic trade
and export and, thereafter, to conduct an inspection of all copra and
its by-products proposed for export to determine if they conform to the
standards established;chanroblesvirtualawlibrary
i) To devise and thereafter prescribe by means of
rules and regulations a method of measuring the moisture content of
copra at its first domestic sale and a scale of deduction according to
the percentage of the moisture content;chanroblesvirtualawlibrary
j) To impose and collect the levies herein authorized
to be collected;chanroblesvirtualawlibrary
k) To impose and collect, under such rules that it
may promulgate, a fee of ten centavos for every one hundred kilos of
desiccated coconut, to be paid by the desiccating factory, coconut oil
to be paid by the oil mills and copra to be paid by the exporters,
which shall be used exclusively to defray its operating expenses;chanroblesvirtualawlibrary
l) To enter into, make and execute contracts of any
kind as may be necessary or incidental to the attainment of its
purposes and, generally, to exercise all the powers necessary to
achieve the purposes and objectives for which it is organized;
provided, however, it shall not engage in commercial/industrial
activities including the commercial production of hybrid coconut
seednuts;chanroblesvirtualawlibrary
m) Except in respect of entities owned or controlled
by the Government or by the coconut farmers under Sections 9 and 10,
Article III hereof, the Authority shall have full power and authority
to regulate the production, distribution and utilization of all
subsidized coconut-based products, and to require the submission of
such reports or documents as may be deemed necessary by the Authority
to ascertain whether the levy payments and/or subsidy claims are due
and correct and whether the subsidized products are distributed among,
and utilized by, the consumers authorized by the Authority;chanroblesvirtualawlibrary
n) To issue subpoena and subpoena duces tecum; to
summon witnesses to appear in any investigation conducted by the
Authority pursuant to its powers granted herein; and, in appropriate
cases, to impose punishment for contempt, direct or
indirect; chanroblesvirtualawlibrary
o) To authorize officers or agents of the Authority
to enter any house, building, or place where subsidized products are
stored or kept, or when there are reasonable grounds to believe that
said products are stored or kept thereat, so far as may be necessary to
examine the same; to seize such products as are found to be unlawfully
possessed or kept; and to stop and search any vehicle or other means of
transportation when there are reasonable grounds to believe that the
same unlawfully carries any subsidized coconut-based products;chanroblesvirtualawlibrary
p) To utilize hereafter, as the basis for final
assessment of the levies herein authorized to be collected, the Central
Bank outturn reports of copra and its by-products at the foreign port
of destination and for that purpose, the Central Bank shall furnish the
Authority with copies thereof;chanroblesvirtualawlibrary
q) To formulate a system for the reward of
compensation of persons instrumental in the discovery of violations of
this law or implementing rules and regulations, and conviction of the
violators; and, whenever necessary, to provide for the appropriate
security of the witnesses testifying against such violators; and
r) To exercise such other powers as may be necessary
and proper for the effective enforcement of this law and the
implementing rules and regulations.
Section 4. Governing Board. — The corporate powers
and duties of the Authority shall be vested in and exercised by Board
of seven (7) members to be appointed by the President, as follows:cralaw:red
a) Two representatives of the Government, one of whom
shall be designated by the President as Chairman and the other as
Vice-Chairman;chanroblesvirtualawlibrary
b) Three members recommended by the Philippine
Coconut Producers Federation;chanroblesvirtualawlibrary
c) One member recommended by the United Coconut
Association of the Philippines;chanroblesvirtualawlibrary
d) One member recommended by the owner and operator
of the hybrid coconut seednut farm herein authorized to be established.
The Board shall have the following additional powers and duties:cralaw:red
a) To direct and manage the affairs of the Authority;chanroblesvirtualawlibrary
b) To prepare and adopt an annual budget;chanroblesvirtualawlibrary
c) To disburse the proceeds of the levies for the
purposes herein authorized; and chanroblesvirtualawlibrary
d) To establish the internal organization of the
Authority and fix the salaries and other compensation of its officers
and employees.
Section 5. Meeting and Quorum. — The Board shall meet
as often as the exigencies of the service may demand. The presence of
at least four members shall constitute a quorum, and the vote of four
members shall be necessary for the adoption of any rule, resolution or
decision or any other act of the Board.
Section 6. Compensation of the Members of the Board.
— The members of the Board shall receive per diem of two hundred pesos
for each meeting actually attended; Provided, That such per diems shall
not exceed one thousand pesos during any month for each member;
Provided, further, That no other allowance or any form of compensation
shall be paid them, except actual expenses in travelling to and from
their residences to attend board meetings.
Section 7. Executive Officers and Personnel. — The
chief executive officer of the Authority shall be the administrator
assisted by such Deputy Administrators as the Board may prescribe, all
of whom shall be appointed, or removed, by the Board and delegated with
such powers and duties as it may prescribe.
All officers and employees of the Authority shall be selected and
appointed by the Board on the basis of merit and fitness.
Section 8. Departments. — The Board may establish
such departments as it may be convenient for the discharge of its
duties; Provided, That only one agronomical research department shall
be created.
ARTICLE III
LEVIES
Section 1. Coconut Consumers Stabilization Fund Levy.
— The Authority is hereby empowered to impose and collect a levy to be
known as the Coconut Consumers Stabilization Fund Levy, on every one
hundred kilos of copra rececade, or its equivalent in other coconut
products delivered to, and/or purchased by, copra exporters, oil
millers, desiccators and other end-users of copra or its equivalent in
other coconut products. The levy shall be paid by such copra exporters,
oil millers, desiccators and other end-users of copra or its equivalent
in other coconut products under such rules and regulations as the
Authority may prescribe. Until otherwise prescribed by the Authority,
the current levy being collected shall be continued.
Section 2. Utilization of Fund. — All collections of
the Coconut Consumers Stabilization Fund Levy shall be utilized by the
Authority for the following purposes: chanroblesvirtualawlibrary
a) When the national interest so requires, to provide
a subsidy for coconut-based products the amount of which subsidy shall
be determined on the basis of the base price of copra or its equivalent
as fixed by the Authority and the prices of coconut-based products as
fixed by the Price Control Council; provided, however, that when the
coconut farmers, who in effect shoulder the burden of the levies herein
imposed, shall have owned or controlled, under Section 9 and 10 hereof,
oil mills and/or refineries which manufacture coconut-based consumer
products, only such oil mills and/or refineries shall be entitled to
the subsidy herein authorized;chanroblesvirtualawlibrary
b) To refund wholly or in part any premium duty
collected on copra or its equivalent sold prior to February 17, 1974;chanroblesvirtualawlibrary
c) To finance the developmental and operating
expenses of the Philippine Coconut Producers Federation including
projects such as scholarships for the benefit of deserving children of
the coconut farmers; and
d) To finance the establishment and operation of
industries and commercial enterprises relating to the coconut and other
palm oil industry as described in Section 9 hereof; and
e) To finance the Coconut Farmers Refund which is
hereby constituted as the pooled savings of the coconut farmers, to be
utilized for their mutual assistance, protection and relief in the form
of social benefits, such as life and accident insurance coverage of the
farmers.
Section 3. Coconut Industry Development Fund. — There
is hereby created a permanent fund to be known as the Coconut Industry
Development Fund, which shall be administered and utilized by the bank
acquired for the benefit of the coconut farmers under PD 755 for the
following purposes:cralaw:red
a) To finance the establishment, operation and
maintenance of a hybrid coconut seednut farm under such terms and
conditions that may be negotiated by the National Investment and
Development Corporation (NIDC) with any private person, corporation,
firm or entity as would insure that the country shall have, at the
earliest possible time, a proper, adequate and continuous supply of
selected high-yielding hybrid as well as indigenous precocious seednuts
and, for this purpose, the contract, including the amendments and
supplements thereto as provided for herein, entered into by NIDC as
herein authorized is hereby confirmed and ratified, and the bank
acquired for the benefit of the coconut farmers under the PD 755 shall
administer the said contract, including its amendments and supplements,
and perform all the rights and obligations of NIDC thereunder,
utilizing for that purpose the Coconut Industry Development Fund;chanroblesvirtualawlibrary
b) To purchase all of the seednuts produced by the
hybrid coconut seednut farm which shall be distributed, for free, by
the Authority to coconut farmers on a voluntary basis as well as for
new areas opened for coconut planting in accordance with, and in the
manner prescribed in, the nationwide coconut replanting program,
provided, that farmers who have been paying the levy herein authorized
shall be given priority; chanroblesvirtualawlibrary
c) To defray the cost of implementing the nationwide
replanting program which, including the activities described in
sub-paragraphs (b) and (d) of this Section, shall upon prior approval
of the President of the Philippines, be implemented by the Authority
through a private non-profit foundation owned by the coconut farmers in
the manner prescribed by Sections 9 and 10 hereof;chanroblesvirtualawlibrary
d) To finance the establishment, operation and
maintenance of extension services, model plantations and other
activities as would insure that the coconut farmers shall be informed
of the proper methods of replanting; and
e) The balance, if any, shall be utilized for
investments for the benefit of the coconut farmers as prescribed in
Section 9 hereof.
Section 4. Coconut Industry Development Fund Levy. —
As the initial funds of the Coconut Industry Development Fund, the
Authority is hereby directed to pay to the Coconut Industry Development
Fund the amount of One Hundred Million Pesos (P100,000,000.00) out of
the Coconut Consumers Stabilization Fund and thereafter the Authority
shall pay to the said Fund an amount equal to at least twenty centavos
(P0.20) per kilogram of copra resecada or its equivalent out of its
current collections of the Coconut Consumer Stabilization Fund Levy. In
the event that the Coconut Consumers Stabilization Fund Levy is lifted,
a permanent levy of twenty centavos (P0.20) is thereafter automatically
imposed on every kilogram of copra or its equivalent in terms of other
coconut products which shall be collected and paid to the Coconut
Industry Development Fund by copra exporters, oil millers, desiccators
and other end-users of copra or its equivalent under rules prescribed
by the Authority.
The sale or transfer of the hybrid coconut seednuts herein authorized
to be acquired is hereby declared exempt from the payment of the
coconut consumers stabilization levy and any and all taxes and fees of
whatever kind and nature.
Section 5. Exemption. — The Coconut Consumers
Stabilization Fund and the Coconut Industry Development Fund, as well
as all disbursements as herein authorized, shall not be construed or
interpreted, under any law or regulation, as special and/or fiduciary
funds, or as part of the general funds of the national government
within the contemplation of PD 711; nor as subsidy, donation, levy
government funded investment, or government share within the
contemplation of PD 898, the intention being that said Fund and the
disbursements thereof as herein authorized for the benefit of the
coconut farmers shall be owned by them in their private capacities:
Provided, however, That the President may at any time authorize the
Commission on Audit or any other officer of the government to audit the
business affairs, administration, and condition of persons and entities
who receive subsidy for coconut-based consumer products as provided in
sub-paragraph (a), Section 2, Article III hereof and those required to
pay the Coconut Consumers Stabilization Fund levy as provided in
Section 1, Article III hereof. chanroblesvirtualawlibrary
Section 6. Rules and Regulations. — For a proper and
effective collection of the levies herein authorized to be imposed and
collected, the Authority is hereby given full power and authority to
promulgate such rules and regulations it may deem proper and necessary.
The Authority may require the persons liable to pay the levies to
submit periodic reports of their receipt of deliveries and/or purchases
of copra or its equivalent; Provided, however, That the Authority shall
have no power to require the disclosure of competitive information
and/or trade secrets such as names and identities of their buyers and
prices at which they sold the copra or its equivalents.
Section 7. Interest and Surcharges. — Hereafter, the
Authority shall have the power to impose and collect interest equal to
14% per annum of the levies paid after the due date thereof: Provided,
however, that in cases of willful or fraudulent failure to pay the
levy, as determined by the Authority, the Authority may impose a
surcharge of 25% in addition to the assessable interest on late
payments. In dispute assessments where genuine issues of fact and/or
law are raised the Authority may, in its discretion, enter into a
compromise settlement of the disputed assessment waiving in whole or
part the assessable levy, interest and surcharges.
Section 8. Deposit of Collections. — All collections
of the levies herein authorized to be imposed and collected shall, upon
collection thereof, be immediately deposited for the account of the
coconut farmers, interest-free by the Authority with the bank acquired
for the benefit of such coconut farmers under PD 755 under such terms
and conditions as will insure that said bank can service in full the
credit requirements of the coconut farmers: Provided, however, That the
deposits shall not be withdrawn for purposes other than those herein
authorized until the nationwide replanting program shall have been
fully implemented and realized.
Section 9. Investments For the Benefit of the Coconut
Farmers. — Notwithstanding any law to the contrary, the bank acquired
for the benefit of the coconut farmers under PD 755 is hereby given
full power and authority to make investments in the form of shares of
stock in corporations organized for the purpose of engaging in the
establishment and the operation of industries and commercial activities
and other allied business undertakings relating to the coconut and
other palm oils industry in all its aspects and the establishment of a
research into the commercial and industrial uses of coconut and other
oil industry. For that purpose, the Authority shall, from time to time,
ascertain how much of the collections of the Coconut Consumers
Stabilization Fund and/or the Coconut Industry Development Fund is not
required to finance the replanting program and other purposes herein
authorized and such ascertained surplus shall be utilized by the bank
for the investments herein authorized.
Section 10. Distribution to Coconut Farmers. — The
investments made by the bank as authorized under Section 9 hereof shall
all be equitably distributed, for free, by the bank to the coconut
farmers except such portion of the investments which it may consider
necessary to retain to insure continuity and adequacy of financing of
the particular endeavor. In effecting the distribution of the
investments to the coconut farmers, the bank shall provided measures as
would ensure the viability and stability of the particular enterprise
and afford the widest distribution of the investments among the coconut
farmers. chanroblesvirtualawlibrary
ARTICLE IV
PENALTIES
Section 1. Whenever any person or entity willfully
and deliberately violates any of the provisions of this Act, or any
rule or regulation legally promulgated hereunder by the Authority, the
person or persons responsible for such violation shall be punished by a
fine of not more than P20,000.00 and by imprisonment of not more than
five years. If the offender be a corporation, partnership or a
juridical person, the penalty shall be imposed on the officer or
officers authorizing, permitting or tolerating the violation. Aliens
found guilty of any offense shall, after having served his sentenced,
be immediately deported and, in the case of a naturalized citizen, his
certificate of naturalization shall be cancelled.
Section 2. Unlawful Possession or Utilization of
Subsidized Products. — Any person or entity who owns, utilizes, and/or
is found in possession of subsidized coconut-based products in
violation of the provisions of this law and the implementing rules
shall be liable to the penalty prescribed in Section 1 above. In
addition, such unlawfully possessed or removed products shall be
confiscated and sold by the Authority, and the proceeds thereof shall
form part of the Coconut Consumers Stabilization Fund.
ARTICLE V
MISCELLANEOUS PROVISIONS
Section 1. Abolished Agencies. — The Coconut
Coordinating Council (CCC), the Philippine Coconut Administration
(PHILCOA) and the Philippine Coconut Research Institute (PHILCORIN) are
hereby abolished and their powers and functions transferred to the
Philippine Coconut Authority, together with all their respective
appropriations, funding from all sources, equipment and other assets,
and such personnel as are necessary; Provided, That personnel separated
from the service hereby shall have the same rights and privileges
accorded to other government employees separated as a result of
implementation of the Integrated Reorganization Plan: Provided,
further, That the Authority, through its Board, shall effect the
transfer herein provided in a manner that will insure the least
disruption of on-going programs and projects; Provided, moreover, That
in the period prior to the actual assumption of duties by the Board and
its functioning as such, all officers and employees of the abolished
agencies shall continue to exercise all their functions and discharge
all their duties and responsibilities until ordered otherwise by the
Board of the Authority, except that the Board of the PHILCORIN and the
PHILCOA as well as the Council itself, shall immediately cease to exist
upon the effectivity of this Decree, and their functions shall be
exercised by the Authority; and Provided, Finally, That until otherwise
so ordered by the President of the Philippines, the incumbent members
of the Governing Board of the Authority are hereby automatically
appointed as such members of the Board.
Section 2. Repealing Clause. — All laws, executive
and administrative orders, rules and regulations inconsistent with the
foregoing provisions are hereby repealed or amended accordingly
including Republic Act Nos. 1145, 1365, 1369 and 2282.
Section 3. Separability Clause. — If any provision of
this Decree is held unconstitutional, the same shall apply only to that
provisions and the remainder hereof remains valid.
Section 4. Effectivity. — This Act shall take effect
immediately.
Done in the City of Manila,
this 11th day of June, in the year of Our Lord, nineteen hundred
seventy-eight.
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