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PRESIDENTIAL DECREE NO. 85
PRESIDENTIAL DECREE NO. 85 -
CREATING THE AGRARIAN REFORM FUND TO SUPPORT FINANCING REQUIREMENTS OF
AGRARIAN REFORM PROVIDED IN PRESIDENTIAL DECREE NO. 27 AND FOR OTHER
PURPOSES
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WHEREAS, there is an imperative need for
immediate implementation of agrarian reform provided in Presidential
Decree No. 27 dated October 21, 1972;chanroblesvirtualawlibrary
WHEREAS, such implementation calls for timely and adequate financial
support in all phases involved in the execution of desired agrarian
reforms; chanroblesvirtualawlibrary
WHEREAS, there is need to mobilize and harness properly available
resources to provide necessary funds for the realization of government
agrarian reform;chanroblesvirtualawlibrary
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers vested in me by the Constitution as
Commander-in-Chief of all the Armed Forces of the Philippines and
pursuant to Proclamation No. 1081 dated September 21, 1972 and General
Order No. 1 dated September 22, 1972, as amended, do hereby order and
decree:cralaw:red
Section 1. Establishment of the Agrarian Reform Fund.
— An Agrarian Reform Fund, hereinafter referred to as the "Fund" is
hereby established to finance and/or guaranty the payment of farm lots
acquired under Proclamation No. 27, dated October 21, 1972, and to
extend agricultural credit support and the corresponding guarantee
coverage to achieve a high level of production in land reform areas of
the country.
The resources of the Fund shall be drawn from the following:cralaw:red
1. Central Bank of the Philippines
a. Bonds in Portfolio
2. Guarantee Funds
a. Agricultural Guarantee Fund
b. Agricultural Guarantee and Loan Fund
c. CB-Loan Guarantee Fund (Calamity Fund)
3. Development Bank of the Philippines chanroblesvirtualawlibrary
a. Preferred shares in client corporations
b. Government-counterpart preferred stocks in rural
banks
c. Preferred stocks in development banks
d. Acquired assets
e. Reparations Account Receivables
f. Other disposable assets
4. Philippine National Bank chanroblesvirtualawlibrary
a. Acquired assets
5. National Investment and Development Corporation
a. Acquired assets
6. Government Service Insurance System
a. Acquired assets
7. Land Bank
a. Shares of stock owned or controlled by the
Government
8. Agrarian Reform Special Account chanroblesvirtualawlibrary
a. Allocation for Agricultural Guarantee Fund and
Land Bank
9. Proceeds from foreign loans
10. Social Security System
a. Acquired assets
11. Other disposable assets of the government as may
be available for the land reform program.
12. Other funds and resources provided by law.
The resources listed above shall be turned over to the Agrarian Reform
Fund at such time, terms, prices and conditions as shall be agreed upon
between the Agrarian Reform Fund Commission and the financial
institution and government agencies concerned, payment to be made by
the former to latter in Agrarian Reform Bonds issued pursuant to
Section 5 of this Decree.
Section 2. Utilization of the Resources of the Fund.
— All resources of the Fund shall be utilized for the attainment of the
objectives of the Fund as follows;chanroblesvirtualawlibrary
(1) Financing of acquisition of lands under any of
the following modes of settlement;chanroblesvirtualawlibrary
a. Cash payment, subject to availability of funds,
for small landholding;chanroblesvirtualawlibrary
b. Exchange arrangement for government stocks in
government-owned or controlled corporations or private corporations
where the government has holdings;chanroblesvirtualawlibrary
c. Payment through the establishment of annuities of
pensions with guarantee against inflation and/or medical
insurance; chanroblesvirtualawlibrary
d. Full guaranty on the payment of the fifteen (15)
equal annual amortizations to be made by the tenant-farmers; and
e. Such other modes of settlement as may be adopted
by the Agrarian Reform Fund Commission.
(2) Financing agricultural production and/or
commodity loans through banking institutions and/or issuance of
guarantee of losses up to eighty-five (85%) per cent of the amount of
the production loan under such terms and conditions as the Agrarian
Reform Fund Commission may prescribe. chanroblesvirtualawlibrary
Section 3. Administration of the Fund. — There is
hereby created an Agrarian Reform Fund Commission, hereinafter referred
to as the Commission, composed of the Secretary of Finance as Chairman
and the Governor of the Central Bank of the Philippines and the
Secretary of Agrarian Reform as members, which shall administer the
Fund. In the event that the Chairman or any members of the Commission
is unable to attend any meeting thereof he shall designate the next
ranking official of the office or agency concerned to represent him in
the meeting of the Commission.
Operational expenses of the Commission shall be advanced by the Central
Bank of the Philippines until such time as the Fund generates income
sufficient for the purpose. The Commission shall reimburse the Central
Bank for its advances, including interests, if any, as soon as
possible. chanroblesvirtualawlibrary
Section 4. Powers and Duties of the Commission. — The
Commission shall have exclusive administration and control of the Fund,
which shall include the authority to invest and dispose of the assets
under its administration. For this purpose, it shall be empowered to
promulgate such rules and regulations necessary for effective
operations of the Fund and may execute acts or perform activities for
the best interest of the Fund.
Section 5. Issuance of Bonds. — The Secretary of
Finance shall, upon recommendation of the Commission and the Monetary
Board of the Central Bank and with the approval of the President of the
Philippines, issue bonds, debentures and other evidences of
indebtedness for the account of the Fund at such terms, rates and
conditions to be determined by the Commission. Such bonds and other
obligations shall be secured by the assets of the Fund and shall be
fully tax exempt both as to principal and income. Said income shall be
paid to the landholders every six months from the date of issue.
These bonds and other obligations issued for the account of the Fund
shall be direct obligations of the Government of the Republic of the
Philippines and shall be redeemable at the option of the Commission at
or prior to maturity, which, in no case shall exceed twenty-five (25)
years.
Section 6. Reorganization of the Land Bank. — The
Agrarian Reform Fund Commission, as holder of all the shares of the
Land Bank owned or controlled by the Government, is hereby authorized,
with the approval of the President of the Philippines, to reorganize
the Land Bank, modify its operations and functions and exercise its
powers and manage its property, the provisions of Republic Act No.
3844, as amended, notwithstanding.
Section 7. Tax Exemptions. — All assets and earnings
of the Fund shall be exempt from all national, provincial, municipal
and city taxes and assessments now in force and may hereinafter be
imposed.
Section 8. Repealing Clause. — All laws, executive
orders, rules or regulations or parts thereof inconsistent with this
Decree are hereby repealed and/or modified accordingly.
Section 9. Effectivity. — This Decree shall take
effect immediately.
Done in the City of Manila,
this 24th day of December, in the year of Our Lord, nineteen hundred
and seventy-two.
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