Section 1. Title. — This Act shall be known as the "National
Dairy Development Act of 1995".
Sec. 2. Declaration of Policy. — It is hereby
declared the policy of the State to strive for national
self-sufficiency in milk and dairy products as a vital feature in the
attainment of a self-reliant and independent Philippine economy in the
provision of proper nutrition and the generation of more employment
opportunities for the people. It is also the policy of the State
to recognize the primary role of the private sector in research,
training, production, processing, and marketing, and to provide
incentives to those undertaking these activities, with government
limiting itself to policy-making, facilitation and regulation.
Towards this end, the State shall create an agency tasked to help the
private sector accelerate the development and growth of the Philippine
dairy industry under the spirit of cooperativism in all stages of dairy
production, processing, distribution, marketing, and other
dairy-related activities, in such a way that market viability of
livestock and dairy products shall be ensured, focusing on developing
breeds adapted to Philippine conditions. Likewise, the State
shall help establish marketing networks and outlets, especially among
and between processors and end-users, which may include the integration
of local milk production with existing industrial milk plants geared
towards the sufficient production of local milk for the needs of the
people.
Sec. 3. Objectives. — The objectives of this Act
are as follows:
(a) To promote and provide direction for the
accelerated development of the Philippine dairy industry, consistent
with the provisions of this Act;
(b) To give support and assistance in the production,
processing and marketing activities of all those engaged in the
business of producing milk and other dairy products particularly rural
based small dairy farmers through the provision of necessary support
systems;
(c) To encourage and promote the active participation
of farm families, rural cooperatives and the private sector recognizing
them as principal agents in the development of the Philippine dairy
industry;
(d) To ensure an adequate supply of milk and dairy
products at affordable prices;
(e) To improve livelihood opportunities and thereby
increase income level through dairying;
(f) To enhance children's and pregnant and nursing
mothers' nutritional intake through the promotion of locally produced
milk and milk products.
(g) To develop and disseminate appropriate
smallholder-based dairy technology;
(h) To improve milk production from existing stock
and systematically program the build-up of productive milking herd; and
(i) To conserve foreign exchange by supporting local
milk production.
Sec. 4. The National Dairy Authority. — To achieve
the objectives of this Act, there is hereby created a National Dairy
Authority (NDA), hereafter referred to as the "Authority", which shall,
for the purpose of policy and program coordination, be attached to the
Department of Agriculture.
The Authority shall be the central policy determining and directing
body tasked to ensure the accelerated development of the Philippine
dairy industry, in accordance with the policies and objectives set
forth in this Act.
Sec. 5. The Dairy Industry Board. — The National
Dairy Authority shall be governed by a Dairy Industry Board, hereafter
referred to as the "Board", to be composed of the following:
(a) The Secretary of Agriculture, a chairperson;
(b) The NDA Administrator, as an ex officio member;
(c) The Secretary of Trade and Industry, as member;
(d) The Secretary of Health, as member;
(e) The Secretary of Education, Culture and Sports,
as member;
(f) The Secretary of Science and Technology, as
member;
(g) The Secretary of Agrarian Reform, as member;
(h) The Director of the Dairy Training and Research
Institute, as member; and
(i) Four (4) other members who shall be appointed by
the President of the Philippines upon the recommendation of the
chairperson: provided, that one (1) shall come from the dairy
cooperatives and/or national dairy federation, with one representative
each from Luzon, Visayas and Mindanao: provided, further, that they
will hold office for a period of three (3) years from the date of their
respective appointments without reappointment; Provided, finally, that
any member appointed to a vacancy shall serve only for the unexpired
term of the member whom he succeeds.
Sec. 6. Powers and Functions of the National Dairy
Authority. — The National Dairy Authority shall have the following
powers and functions:
a) To formulate and execute dairy programs that will
generate a national impact on rural as well as urban nutrition levels
and incomes;
b) To assist in the purchase, importation,
propagation, storage, distribution and sale of dairy equipment and
engineering supplies and such other inputs as may be needed by the
dairy industry;
c) To encourage the integration of dairy production
and local milk and the distribution of dairy products into various
rural livelihood and nutrition programs;
d) To assume control and supervision over all
dairy-related government agency personnel and programs, including the
Bureau of Animal Industry's Dairy Division, the Livestock Development
Council's Dairy Division, the Philippine Dairy Corporation, Livelihood
Corporation's Laguna Processing Center and other dairy related
government agencies, division, councils subject to the guidelines
prescribed by the Civil Service Commission;
e) To borrow, raise or obtain funds; to issue bonds
and other instruments of indebtedness; or to enter into any financial
or credit arrangement in order to support or carry out its objectives
and purposes, subject to pertinent laws governing public debts and
expenditures;
f) To receive grants, subsidies, donations or
contributions from corporations, thrusts, foundations, associations and
other sources from any private or government office, agency or
corporation in the Philippines or abroad;
g) To establish, maintain or operate field units or
offices in various parts of the country in order to utilize the
objectives of this Act;
h) To help design and implement a credit system that
will finance dairy farmers and dairy cooperatives or associations;
i) To charge reasonable fees for services rendered
for the attainment of the objectives of this Act;
j) To promulgate rules and regulations to carry out
the provisions and policy objectives of this Act; and
k) To adopt, alter and use a corporate seal; to sue
and be sued; and otherwise to do and perform all acts or exercise all
powers as may be necessary or incidental to carry out the objectives of
this Act.
Sec. 7. Meeting of the Board. — The Board shall
convene in a regular monthly meeting and shall hold special meetings
when necessary. The presence of at least seven (7) members of the
Board shall constitute a quorum and the vote of a majority of those
present shall be sufficient to transact business during any meeting:
provided, that the department secretaries can be represented on a
permanent basis by their respective undersecretaries or assistant
secretaries who will have full voting power and shall be considered in
the determination of quorum: provided, finally, that the chairperson
shall not vote except in case of a tie.
Sec. 8. Allowance of the Board Members. — The
chairperson and members of the Board shall be entitled to per diems and
other allowable emoluments as may be fixed by the Board for every
meeting actually attended, subject to existing laws, rules and
regulations which, in no case, shall exceed four thousand pesos
(P4,000.00) per month: provided, however, that the transportation
expenses for representatives from far places will be reimbursed:
provided, finally, that the Administrator of the Authority, as an ex
officio member of the Board, shall receive only the remuneration and
allowances which shall be provided by the Board for the said position.
Whenever the exigencies of the service demand, and the Board, for any
valid reason, cannot be convened to a meeting, the Administrator, in
coordination with the Board Secretary, is hereby authorized to submit
any matter for resolution by memorandum and the concurrence of a
majority of the Board members and/or alternates constituting a quorum
shall be considered sufficient for the approval thereof.
Sec. 9. Management of the Authority. — There shall
be a full time Administrator who shall manage the operations of the
Authority, to be assisted by a Deputy Administrator. Both the
Administrator and the Deputy Administrator shall be appointed by the
President of the Philippines.
The Administrator shall be a citizen of the Philippines; at least
thirty-five (35) years of age on the date of his appointment; of good
moral character; with recognized executive ability and competence; and
preferably well-versed in the various aspects of the dairy industry.
The salary and allowances of the Administrator and Deputy Administrator
shall be in accordance with the provisions of R.A. 6758 or "The Salary
Standardization Act of 1989".
SECTION 10. Powers and Functions of the
Administrator. — Subject to the control and supervision of the Board,
the Administrator shall have the following powers and functions:
a) Submit policy recommendations and proposed
measures necessary to carry out the objectives and functions of the
Authority, for the consideration of the Board;
b) Recommend to the Board, for approval, an
organizational structure, and plantilla of personnel of the Authority,
in accordance with existing laws, rules and regulations;
c) Execute, administer and implement policies and
measures approved by the Board;
d) Submit to the Board, in line with the national
budget cycle, an annual budget and such supplemental budget as may be
necessary for its consideration and approval;
e) Represent the Authority in all its dealings with
other persons, entities, agencies, and institutions whether public or
private, domestic or foreign, subject to the limitations and conditions
herein provided;
f) Appoint, subject to the confirmation of the Board,
and discipline or remove for cause in accordance with the civil service
law, rules and regulations, the officers and personnel of the
Authority; and
g) Perform such other duties which may be assigned to
him by the Board or by the Secretary of the Department of Agriculture.
SECTION 11. Dairy Cooperative and Farmers'
Organizations. — The Authority shall help organize small producers and
processors of milk into cooperatives or other forms of organizations to
achieve the purposes of this Act including the following:
a) To facilitate collective arrangements that will
enable cooperatives to acquire dairy animals, feeds, veterinary and
other supplies, materials, equipment, services of all kinds and other
dairy inputs under favorable terms;
b) To provide a forum for the members of cooperatives
to discuss common problems affecting production, marketing and the
cooperatives' relationships with the Authority;
c) To help design credit systems that will provide
loans, grants and such services as may be required, to dairy
cooperatives and duly accredited people's organizations;
d) To assist cooperatives in developing market
channels and in negotiations for bulk outlets of milk output;
The authority shall support the formation of a Dairy Cooperatives
Federation among dairy cooperatives as a channel of its coordinative
function in the industry.
SECTION 12. National Dairy Campaign. — The Authority
shall promote a nationwide campaign to boost support for the
realization of the objectives of this Act. It shall encourage the
participation of women's groups in dairy and dairy-related projects
including dairy animal health care, village nutrition schemes,
community-based processing, and marketing of milk and dairy products.
SECTION 13. Priority Projects. — Immediately after
the approval of this Act, the Authority, in coordination with other
related agencies, shall undertake vigorously the following:
a) Educational programs for dairy farmers and dairy
cooperatives including, but not limited to, the conduct of seminars,
workshops, assemblies and others;
b) Training programs including, but not limited to,
courses in animal husbandry, feed technology, dairy cooperatives
management and other related aspects of dairying;
c) Dairy research and development including but not
limited to, breeds and breeding, herd improvement, indigenous and
agriwaste feed sourcing, product development, herbal veterinary drugs
and biologics, dairy facilities fabrication, and others;
d) Establishment of support services to dairy farmers
and cooperatives in the acquisition of basic supplies and inputs for
animal health and nutrition; and
e) Boost the number and quality of local animal
stocks through applied technology.
SECTION 14. Dairy Development Fund. — To implement
Section 13 of this Act, there is hereby created a Dairy Development
Fund which shall be used exclusively for the above-mentioned programs
in the amount of Two hundred million pesos (P200,000,000) from the
funds in the National Treasury not otherwise appropriated. Annually
thereafter, the amount of not less than One hundred forty million pesos
(P140,000,000) shall be provided to augment the fund in the General
Appropriations Act.
SECTION 15. Government Agency Support. — The
Authority shall coordinate closely with other government agencies in
the establishment of support services for the dairy industry,
including, among others, needed infrastructure, and the setting of
tariff rates to countervail subsidized imports.
SECTION 16. Nutrition Programs. — The government's
nutrition programs requiring milk and dairy products shall be sourced
from small farmers and dairy cooperatives in coordination with the
Authority.
SECTION 17. Supply and Distribution. — The Authority
shall monitor the importation, manufacture, supply and distribution of
dairy products and raw materials for the manufacture or processing of
milk and dairy products, as well as the importation and exportation of
dairy animals, if the needs of the industry require, it shall, after
public hearing and after consultations with the National Economic and
Development Authority, the Department of Trade and Industry, the
Department of Finance, and the representatives of the dairy
cooperatives and the commercial sector, set guidelines for the
importation, exportation and pricing of dairy animals, raw materials
and other products necessary for the manufacture or processing of milk
and dairy products: provided, that within a period of three (3) years
from the effectivity of this Act, the dairy cooperatives and the
commercial sector shall, subject to quality and price considerations,
mutually agree upon a volume of local milk production to be absorbed by
the commercial sector.
If at the end of the three-year period, the parties mentioned above
have not come to a mutual agreement, the commercial sector shall absorb
a fixed portion of the local milk supply to be determined by the
Authority.
Processors who purchase locally produced milk from dairy cooperatives
in excess of the volume prescribed by the Authority shall be accorded
tax credits equivalent to ten (10%) percent of the value of the excess
volume purchased.
SECTION 18. Exemption from Taxes and Duties. — The
authority shall be exempt from the payment of customs duties and taxes
on the importation of dairy animals, veterinary and other supplies,
other farm inputs, dairy equipment and machineries, including its spare
parts, for distribution to dairy cooperatives subject to the following
conditions:
(1) That said equipment and machineries, including
its spare parts are not manufactured domestically in sufficient
quantity, of comparable quality and reasonable prices;
(2) That it shall be actually, directly and
exclusively used by the dairy cooperatives in the manufacture of its
products;
(3) That it shall not be disposed within three (3)
years from acquisition, without prior approval of the Authority; and
(4) If it will be subsequently sold, transferred or
exchanged in the Philippines to non-exempt persons or entities, the
purchasers or recipients shall be considered the importers thereof, and
shall be liable for the customs duties and internal revenue taxes due
on such importations. The customs duties and internal revenue taxes due
on such articles shall constitute a lien on the article itself,
superior to all other charges or liens, irrespective of the possessors
thereof.
Any donation, contribution, bequest, subsidy or financial aid which may
be made to the Authority shall constitute as allowable deduction from
the income of the donor for income tax purposes and shall be exempt
from donor's tax, subject to such conditions as provided under the
National Internal Revenue Code, as amended.
Small farmers and small farmers' dairy cooperatives shall be exempt
from all taxes on proceeds from sale of raw milk and milk products.
Milk processors shall enjoy a presumptive input tax credit of four
percent (4%) of the value of their gross purchases from small farmers
and small farmers' dairy cooperatives.
SECTION 19. Credit Facilities. — The Bangko Sentral
ng Pilipinas shall adopt such monetary and re-discounting policies as
may be designed to encourage rural banks, savings and loan
associations, commercial banks and other credit institutions to meet
the financing and credit needs essential to achieve the objectives of
this Act.
In addition, the Philippine National Bank, the Land Bank of the
Philippines and the Development Bank of the Philippines shall design
and establish special lending programs at affordable terms for small
dairy farmers and dairy cooperatives.
Sec. 20. Auditor. — The authority shall have an
auditor and complementary personnel who shall be appointed by the
Commission on Audit in accordance with the civil service law, rules and
regulations. The salaries of the auditor and the audit staff
shall be determined and paid by the Commission on Audit.
Sec. 21. Transitory Provision. — The Philippine
Dairy Corporation is hereby abolished. The dairy functions of the
Livestock Development Council, the Dairy Division of the Bureau of
Animal Industry and the Livelihood Corporation's Laguna Processing
Center are hereby transferred to the Authority.
The personnel, assets, funds held, grants, subsidies and records of the
abolished agencies, as well as those of the Livestock Development
Council, the Dairy Division of the Bureau of Animal Industry and the
Laguna Processing Center are hereby transferred to the Authority.
The Secretary of Agriculture shall designate an officer-in-charge
pending the appointment of the administrator by the President of the
Philippines.
Incumbent officials and employees of the affected offices shall
continue to exercise their respective functions, duties and
responsibilities, with the corresponding benefits and privileges unless
and until otherwise ordered by the Board.
The new position structure and staffing pattern of the Authority shall
be approved and prescribed by the Board within ninety (90) days from
the effectivity of this Act within guidelines set by existing civil
service and other laws, rules and regulations on the matter.
Those separated from the service shall receive the retirement benefits
to which they may be entitled under existing laws, rules and
regulations. Otherwise, they shall be paid the equivalent of one (1)
month's salary for every year of service or a fraction thereof,
computed on the basis of the highest salary received, but in no case
shall such exceed the equivalent of twelve (12) months' salary.
Sec. 22. Penalty Clause. — Any person or entity
found guilty of violating any provision of this Act, shall be sentenced
to an imprisonment of not more than six (6) months or a fine of not
more than Twenty thousand pesos (P20,000.00) or both upon the
discretion of the Court.
Sec. 23. Promulgation of Rules and Regulations. —
The Department of Agriculture, in coordination with the member agencies
and the private sector representatives of the Dairy Industry Board
shall prepare and issue the rules and regulations implementing this Act
within six (6) months from the date of its effectivity.
In addition, the Secretary of the Department of Agriculture (DA) shall
report to both Houses of Congress on the status of the promulgation of
the rules and regulations within ninety (90) days from the date of the
effectivity of this Act.
Sec. 24. Appropriations. — The appropriations of
agencies, division, council and corporation, merged, abolished or
transferred pursuant to this Act shall be turned over to the
Authority. Thereafter, such sums as may be necessary for its
continued operation and maintenance shall be included in the annual
General Appropriations Act.
Sec. 25. Repealing Clause. — All laws, decrees,
executive orders, rules and regulations or parts thereof which are
inconsistent with this Act are hereby repealed or modified accordingly.
Sec. 26. Separability Clause. — If any provision
of this Act is declared unconstitutional or invalid, other provisions
thereof which are not affected thereby shall continue in full force and
effect.
Sec. 27. Effectivity. — This Act shall take effect
after fifteen (15) days following its publication in the Official
Gazette or in any newspaper of general circulation.
Approved: February 20, 1995
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