Sec. 5.    The Commission shall be under a Commissioner and an Assistant Commissioner appointed by the President of the Philippines with the consent of the Commission on Appointments. Each shall a Filipino citizen, at least twenty-five years of age and an inventor with at least one invention or utility model patent issued by the Philippine Patent Office. The Commissioner and the Assistant Commissioner shall receive an annual compensation of twelve thousand pesos and ten thousand pesos, respectively, and both shall hold office during good behavior and may be removed from office only for cause.

Sec. 6.    The Commissioner shall promulgate, subject to approval of the National Science Development Board, such rules and regulations as may be necessary for the conduct and exercise of the functions, powers and duties of the Commission under this Act: Provided, That any assistance rendered by the Commission in accordance with paragraphs (a), (b), (c) and/or (g) of Section three of this Act shall be given on condition that the inventor-applicant shall sign a contract agreeing to give to the Commission at least ten per cent of all royalties arising from the local and foreign patents of his invention developed and perfected or secured and/or protected through the service and or financing of the Commission, depending upon the extent of the service or given to him. The proceeds from these contract shall accrue to the general funds of the Commission and shall be used to carry out its objectives. The invention and the patent that may be obtained therefor shall belong to the inventor, subject to the provision of this section.  

Sec. 7.    The Commissioner, with the approval of the National Science Development Board, may select a suitable location on any public land owned by the National Government for the site of its public research laboratory and experimental station or branch thereof with an area not exceeding twenty-four hectares and with housing facilities for the inventors and researchers working therein. Within three months from receipt of the choice of the Commissioner duly approved, the Director of Lands shall cause the chosen site to be surveyed, delimited and transferred to the Commission to be under its exclusive jurisdiction and control.

Sec. 8.    The Commission shall have the following divisions: Patent Examining Division, Research Division, Legal Division, Evaluation and Financing Division, Administrative Division and other divisions that the Commission, with the approval of the National Science Development Board, may deem necessary to create. To better assure the attainment of the objectives of this Act, the heads of divisions of the Commission, shall be Filipino inventors, at least twenty-three years of age and except the head of the Legal Division, with at least one invention or utility model patent issued by the Philippine Patent Office. The division heads shall receive an annual compensation of eight thousand four hundred pesos.

Such technical and administrative personnel as may be necessary to carry out the functions of the Commission shall be appointed by the Chairman of the National Science Development Board upon recommendation of the Commissioner of the Commission and subject to the approval of the Board.  

In view of the limited number of persons who may qualify for positions in the Commission requiring the appointee to be an inventor with at least one invention or utility model patent issued by the Philippine Patent Office where nobody qualities for a given position, an officer of the Commission or of the National Science Development Board, may temporarily appointed to that position and may receive additional compensation not exceeding one-half of the compensation for the second position until qualified inventor can fill the vacancy.

Sec. 9.    All donations and grants to the Commission shall be tax-exempt and deductible in full from the donor's income tax returns and when evidence by a certificate duly issued by the Commissioner. Any person who evades or defeats, or attempts to evade or defeat in any manner any tax imposed by law by availing himself of the provisions of this section through fraud or misrepresentation shall be punished by a fine of not exceeding one year or both, in the discretion of the court. In case the violator is a corporation or association, the president or general manager thereof shall criminally liable, without prejudice to the criminal responsibility of the member, officer or employee thereof committing such violation.

Sec. 10.    To promote and encourage the manufacture of local inventions, they shall be exempted from all kinds of taxes, licenses and permits during the first five years from the date of the grant of the letters of patent: Provided, That their capitalization does not exceed fifty thousand pesos: And provided, further, That their manufacture is carried out by the inventor himself as a home industry.

Sec. 11.    The Commission shall be constituted within one month from the approval of this Act and the sum of five hundred thousand pesos is hereby appropriated out of any funds in the National Treasury not otherwise appropriated to be released immediately to the Commission to enable it to carry out as soon as possible the objectives of this Act.  

Sec. 12.    There is hereby authorized to be appropriated annually such sums as may be necessary to carry out the provisions and objectives of this Act to be included under the general appropriations for the National Science Development Board: Provided, That these sums shall not be less than the original appropriation of five hundred thousand pesos. At least fifty percent of the annual appropriation shall be used to grant aid to inventors to enable them to develop, perfect and produce their patented inventions or those with pending patents, and at least ten percent of the balance shall be used for the awards of the Commission to encourage the patenting of inventions and promote science-consciousness and creativeness among our people.

Sec. 13.    The unconstitutionality of any section, subsection, sentence, clause or term of this Act shall not affect the validity of the other provisions thereof.

Sec. 14.    All provisions of law, rules, regulations or orders contrary to or inconsistent with the provisions of this Act are hereby repealed.

Sec. 15.    This Act shall take effect upon its approval.

Approved: April 13, 1964