1586
ESTABLISHING AN ENVIRONMENTAL IMPACT STATEMENT
SYSTEM INCLUDING OTHER ENVIRONMENTAL
MANAGEMENT RELATED MEASURES AND FOR OTHER
PURPOSES
WHEREAS, the pursuit of a comprehensive and integrated environmental protection program necessitates the
establishment and institutionalization of a system whereby the exigencies of socio-economic undertakings can be
reconciled with the requirements of environmental quality;
WHEREAS, the regulatory requirements of Environmental Impact Statement and Assessment instituted in pursuit
of this national environmental protection program have to work into their full regulatory and procedural details in a
manner consistent with the goals of the program.
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested
in me by the Constitution, do hereby order and declare:
Section 1. Policy. - It is hereby declared the policy of the State to attain and maintain a rational and orderly balance
between socio-economic growth and environmental protection.
Section 2. Environmental Impact Statement System. - There is hereby established an Environmental Impact
Statement System founded and based on the environmental impact statement required, under Section 4 of
Presidential Decree No. 1151, of all agencies and instrumentalities of the national government, including
government owned or controlled corporations, as well as private corporations, firms and entities for every proposed
project and undertaking which significantly affect the quality of the environment.
Section 3. Determination of Lead Agency. - The Minister of Human Settlements or his designated representative is
hereby authorized to name the Lead Agencies referred to in Section 4 of Presidential Decree No. 1151, which shall
have jurisdiction to undertake the preparation of the necessary environmental impact statements on declared
environmentally critical projects and areas. All Environmental Impact Statements shall be submitted to the National
Environmental Protection Council for review and evaluation.
Section 4. Presidential Proclamation of Environmentally Critical Areas and Projects. - The President of the
Philippines may, on his own initiative or upon recommendation of the National Environmental Protection Council,
by proclamation declare certain projects, undertakings or areas in the country as environmentally critical. No person,
partnership or corporation shall undertake or operate any such declared environmentally critical project or area
without first securing an Environmental Compliance Certificate issued by the President or his duly authorized
representative. For the proper management of said critical project or area, the President may by his proclamation
reorganized such government offices, agencies, institutions, corporations or instrumentalities including the
realignment of government personnel, and their specific functions and responsibilities.
For the same purpose as above, the Ministry of Human Settlements shall:
(a) prepare the proper land or water use pattern for said critical project(s) or area(s);
(b) establish ambient environmental quality standards;
(c) develop a program of environmental enhancement or protective measures against calamitous factors such as
earthquake, floods, water erosion and others, and
(d) perform such other functions as may be directed by the President from time to time.
Section 5. Environmentally Non-Critical Projects. - All other projects, undertakings and areas not declared by the
Presidents as environmentally critical shall be considered as non-critical and shall not be required to submit an
environmental impact statement. The National Environmental Protection Council, thru the Ministry of Human
Settlements may however require non-critical projects and undertakings to provide additional environmental
safeguards as it may deem necessary.
Section 6. Secretariat. - The National Environmental Protection Council is hereby authorized to constitute the
necessary secretariat which will administer the Environmental Impact Statement System and undertake the
processing and evaluation of environmental impact statement.
Section 7. Management and Financial Assistance. - The Ministry of Human Settlements is hereby authorized to
provide management and financial support to government offices and instrumentalities placed under it's supervision
pursuant to this Decree financed from its existing appropriation or from budgetary augmentation as the Minister of
Human Settlements may deem necessary.
Section 8. Rules and Regulations. - The National Environmental Protection Council shall issue the necessary rules
and regulations to implement this Decree. For this purpose, the National Pollution Control Commission may be
availed of as one of its implementing arms, consistent with the powers and responsibilities of the National Pollution
Control Commission as provided in P.D. No. 984.
Section 9. Penalty for Violation. - Any person, corporation or partnership found violating Section 4 of this Decree,
or the terms and conditions in the issuance of the Environmental Compliance Certificate, or of the standards, rules
and regulations issued by the National Environmental Protection Council pursuant to this Decree shall be punished
the suspension or cancellation of his/its certificate and/or a fine in an amount not to exceed fifty thousand pesos
(50,000.00) for every violation thereof, at the discretion of the National Environmental Protection Council.
Section 10. Environmental Revolving Fund. - Proceeds from the penalties prescribed in the preceding Section 9 and
other penalties imposed by the National Pollution Control Commission as authorized in P.D. 984 shall be
automatically appropriated into an Environment Revolving Fund hereby created as an exemption to P.D. 711 and
P.D. 1234. The fund shall be used exclusively for the operations of the National Environmental Protection Council
and the National Pollution Control Commission in the implementation of this Decree. The rules and regulations for
the utilization of this fund shall be formulated by the Ministry of Human Settlements and submitted to the President
for approval.
Section 11. Repealing Clause. - The inter-agency Advisory Council of the National Pollution Control Commission
created under Section 4 of P.D. 984 is hereby abolished and its powers and responsibilities are forthwith delegated
and transferred to the National Environmental Protection Council. All laws, decrees, executive orders, rules and
regulations, inconsistent herewith are hereby repealed, amended or modified accordingly.
Section 12. Effectivity Clause. - This Decree shall take effect immediately.
DONE in the City of Manila, this 11th day of June in the year of Our Lord Nineteen Hundred and Seventy-
Eight.
Republic Act No. 1364
An Act to Regulate the Practice of Sanitary Engineering in the Philippines Be it enacted by the Senate and
House of Representatives of the Philippines in Congress assembled:
Article I
TITLE OF ACT AND DEFINITION OF TERMS
Section 1. Title of Act.- This Act shall be known as the “Sanitary Engineering Law.”
Section 2. Definition of Terms.- The practice of sanitary engineering within the meaning and intent of this Act shall
embrace the following activities:
a. Sanitary surveys, reports, design, direction, management, consultation, and investigation of:
1. Water purification plants, water collection and distribution systems, reservoirs, drainage and sewer systems,
sewage treatment plants, malaria control structures, sewage disposal tanks, and other structures for public health and
welfare.
2. Projects relating to stream pollution, insect and vermin control or eradication, rural and camp sanitation, and milk
and food sanitation.
3. Systems for the prevention of atmospheric pollution or the control of indoor air, especially the air of working
spaces in industrial establishments (industrial hygiene engineering).
b. Professional research and laboratory work supporting the activities listed in subsection (a).
c. The term “sanitary engineer” as used in this Act shall mean a person duly registered with the Board of Examiners
for Sanitary Engineers2 in the manner as hereinafter provided.
Article II
BOARD OF EXAMINERS FOR SANITARY ENGINEERS 2
Section 3. Composition of Board.- Within thirty days from the effectivity of this Act there shall be created a Board
of Examiners for Sanitary Engineers2, hereinafter referred to as the Board, to be composed of a chairman and two
members who shall be appointed by the President of the Philippines* upon the recommendation of the Commission
of Civil Service3 from among such persons of recognized standing in their profession as may be certified as having
practiced at least five years, and academically and morally fully qualified by their respective bona fide sanitary
engineering associations. The members of the Board shall hold office for a term of three years after appointment or
until their successors shall have been appointed and shall have duly qualified. The first members of the Board
appointed under this Act shall hold office for the following terms: one member for one year; one member for two
years; and one member for three years. Each member of the Board shall qualify by taking the proper oath of office
before entering upon the performance of his duties. Any member of the Board may be removed by the President for
neglect of duty, incompetence, malpractice, unprofessional, unethical, immoral, or dishonorable conduct, after
having been given opportunity to defend himself in a proper administrative investigation: Provided, That during the
process of investigation, the President* shall have the power to suspend such member under investigation and shall
appoint a temporary member in his place. Vacancies in the Board shall be filled for the unexpired term.
Section 4. Powers and Duties of the Board.- The Board of Examiners for Sanitary Engineers4 is vested with
authority, conformable with the provisions of this Act, to administer oaths, issue, suspend and revoke certificates of
registration for the practice of sanitary engineering, issue certificates of recognition to sanitary engineers already
practicing prior to the effectivity of this Act for advanced studies, research and/or highly specialized training in any
branch of sanitary engineering subject to the approval of the President, to investigate such violations of this Act and
the regulations thereunder as may come to the knowledge of the Board and for this purpose, issue subpoena duces
tecum to secure appearance of witnesses in connection with the charges presented to the Board, to inspect, at least
once a year, educational institutions offering courses in sanitary engineering, to discharge such other powers and
duties as may affect ethical and technological standards of the sanitary engineering profession in the Philippines. For
the purpose of this Act, the Secretary of Health, and/or his duly authorized representatives in the provinces and
chartered cities shall be ex officio agents of the Board, and as such it shall be their duty to help in the enforcement of
the provisions of this Act. If any person shall refuse to obey any subpoena so issued or shall refuse to testify or
produce any book document, etc., the Board may present its petition to the Court of First Instance, setting forth the
facts and thereupon such court shall, in a proper case, issue its subpoena to such person, requiring his appearance
before such court, and there to testify or produce such books, papers, documents, etc., as may be deemed necessary
and pertinent by the Board. Any person failing or refusing to obey the subpoena or order of the said court, may be
proceeded against in the same manner as for refusal to obey any other subpoena or order of the court.
Section 5. Qualifications of Board Members.- Each member of the Board shall, at the time of his appointment:
a. Be a citizen and resident of the Philippines;
b. Be at least thirty years of age and of good moral character;
c. Be a graduate of sanitary engineering or a registered civil engineer who has taken major subjects in sanitary
engineering from a recognized and legally constituted school, institute, college or university and/or a registered Civil
Engineer who has passed the Civil Service examination for Senior Sanitary Engineer;
d. Be a registered sanitary engineer duly qualified to practice sanitary engineering in the Philippines and
have practiced sanitary engineering, with a certificate as such, for a period of not less than five years prior to his
appointment;
e. Not be a member of the faculty of any school, institution, college or university where sanitary engineering course
is taught nor have a pecuniary interest in such institution;
f. No former members of the faculty of any school, institution, college or university where sanitary engineering is
taught can become a member of the Board, unless he had stopped teaching for at least three consecutive years prior
to his appointment.
Section 6. Registration and Examination Fees.- The Board of Examiners shall charge for each application for
examination, the sum of thirty-five pesos and for each certificate of registration, ten pesos.
Section 7. Compensation of Board Members.- The members of the Board shall each receive as compensation, the
sum of five pesos for each applicant examined. A sanitary engineer in the service of the Government of the
Philippines, appointed as member of the Board shall receive the compensation as herein provided in addition to his
salary in the Government. All authorized expenses of the Board shall be paid by the Bureau of Civil Service.5 The
Board, including the compensation provided for hereinafter, shall be paid by the collecting and disbursing office of
the Bureau of Civil Service,6 out of such appropriation, as may be made for the purpose.
Section 8. Executive Officer of the Board.7-
Section 9. Annual Report.- The Board shall submit an annual report to the President8 after the close of each fiscal
year, giving a detailed account of its proceedings during the year and making such recommendations as may be
deemed proper.
Section 10. Roster of Sanitary Engineers.- A roster showing names and place of business and permanent home
addresses of all professional sanitary engineers, shall be prepared by the Commissioner of Civil Service9 during the
month of July of every year, commencing one year after the date this Act becomes effective. Copies of this roster
shall be mailed to each person so registered and placed on file with the President*; and copies thereof, shall be
furnished to all Department Heads, to the mayors of all chartered cities, to the Director of Public Works, to the
Collector of Customs, to such other bureaus, or government agencies and provincial and municipal authorities as
may be deemed necessary, and to the public upon request.
Article III
EXAMINATION FOR REGISTRATION
Section 11. Examination Requirement.- All applicants for registration for the practice of sanitary engineering, shall
be required to pass a technical examination as hereinafter provided.
Section 12. Holding of Examination.- Examination of candidates desiring to practice sanitary engineering in the
Philippines shall be given in the City of Manila, beginning the last Monday of January and August of each year,
provided that such days do not fall on official holidays, otherwise the examination shall be held on the days next
following.
Section 13. Subjects of Examination.- Applicants for certificates of registration as sanitary engineers shall be
examined in the following subjects: Mathematics, including algebra, plane and spherical trigonometry, analytics,
descriptive and solid geometry, differential and integral calculus, rational and applied mechanics; hydraulics,
topographic and hydrographic surveying; design and construction of wooden, masonry, reinforced concrete, and
steel structures as flumes, water towers and drainage canals; hydrology; water and sewage analysis; microbiology
and bacteriology; design and construction of sewers, storm drains, water purification plants, sewage treatment plants
and plumbing: Provided, however, That duly registered civil engineers shall be exempted from taking examinations
in the following subjects: (1) Mathematics, including algebra, plane calculus, rational and applied mechanics; (2)
hydraulics; (3) topographic and hydrographic surveying; and (4) design and construction of wooden, masonry,
reinforced concrete and steel structures as flumes, water towers and drainage canals.
Section 14. Report of Ratings.- The Board of Examiners for Sanitary Engineering10 shall, within one hundred and
twenty days after the date of completion of the examination, report the rating obtained by each candidate to the
Commissioner of Civil Service,11 who shall submit such ratings to the President.*
Section 15. Reexamination.- An applicant who for the third time fails to pass the examination for the same grade
shall not be allowed to take another until at least one year has elapsed after his last examination.
Section 16. Issuance of Certificates.- The President12 shall, upon the recommendation of the Board, issue a
certificate of registration upon payment of the registration fee as provided in this Act to any applicant, who, in the
opinion of the Board and after approval by the President, has satisfactorily met all the requirements specified in this
Act. All certificates of registration shall show the full name of the registrant, shall have a serial number, and shall be
signed by all the members of the Board, the President and the Commissioner of Civil Service13 and shall be attested
by the official seal of the same Board. The issuance of a certificate of registration by the Board to a registrant shall
be evidence that the person named therein is entitled to all the rights and privileges of a registered sanitary engineer,
while said certificate remains unrevoked and unsuspended, unless the same is revoked or suspended.
Section 17. Qualifications for Examination.- Any person applying for admission to the sanitary engineering
examination as herein provided, shall, prior to the date of the examination, establish to the satisfaction of the Board
that he has the following qualifications:
a. Be at least twenty-one years of age;
b. Be a citizen of the Philippines;
c. Be of good reputation and moral character; and,
d. Be a graduate of a four-year course in sanitary engineering or BSCE having taken major subjects in sanitary
engineering from a school, institute, college or university recognized by the Government or the State wherein it is
established.
Section 18. Oath of Sanitary Engineers.- All successful candidates shall be required to take a
professional oath before the Board of Examiners for Sanitary Engineers14 or other Government officials authorized
to administer oaths, prior to entering upon the practice of the sanitary engineering profession.
Section 19. Seal and Use of Seal.- All registered sanitary engineers shall obtain a seal of such design as the Board
shall authorize and direct: Provided, however, That the serial number of the certificate issued by the Board shall be
included in the design of the seal. Plans and specifications prepared by, or under the direct supervision of a
registered sanitary engineer shall be stamped with the seal during the life of the registrants’ certificate, and it shall
be unlawful for any one to stamp or seal any document with said seal after the certificate of the registrant named
therein has expired or has been revoked, unless said certificate shall have been renewed or reissued.
Section 20. Exemption from Registration.- Registration shall not be required of the following persons:
a. Officers or enlisted men of the United States and Philippine Armed Forces and civilian employees of the
Government of the United States stationed in the Philippines while rendering sanitary engineering services for the
Unites States and/or Philippines.
b. Foreign sanitary engineers or experts called in by the Philippine Government for consultation for specific sanitary
engineering services as defined under this Act: Provided, That this practice shall be limited to such work: And
Provided, further, That they do not engage in private practice at their own account as sanitary engineers.
Section 21. Refusal to Issue Certificate.- The Board of Examiners for Sanitary Engineers16 shall not issue a
certificate to any person convicted by a court of competent jurisdiction of any criminal offense involving moral
turpitude, or to any person guilty of immoral or dishonorable conduct, or to any person of unsound mind. In the
event of a refusal to issue a certificate to any person, the Board shall give to the applicant a written statement setting
forth its reason for such action, which statement shall be incorporated in the records of the Board.
Section 22. Suspension and Revocation of Certificates. - Subject to the approval of the President, the Board shall
have the power after due notice and hearing, to suspend or revoke the certificate of registration for any cause
mentioned in the preceding section.
Section 23. Re-issue and Replacement of Certificates.- The Board may, after the expiration of one year from the
date a certificate of registration is revoked and for reasons it may deem sufficient, entertain an application for a new
certificate of registration from the registrant concerned. Such application shall be accomplished in the same form
prescribed for examination, but the Board may, in its discretion, exempt the applicant from taking the requisite
examination.
Section 24. Transitory Provisions.- Within one year, or as soon as this Act takes effect, any person desiring to
practice the profession of sanitary engineering shall be required only to obtain a certificate of registration in the
manner and under the condition herein provided:
1. All graduates of sanitary engineering or civil engineers who have taken major subjects in sanitary engineers who
have taken major subjects in sanitary engineering from a recognized and legally constituted school, institute, college
or university, with at least two years experience as sanitary engineers; all civil engineers in the employ of the
Philippine Government or in private practice in the Philippines who have at least five years experience in sanitary
engineering services and civil engineers with no less than ten years continuous practice as master plumbers, prior to
the approval of this Act; and,\
2. All civil engineers who have passed the Assistant Sanitary Engineer or Senior Sanitary Engineer Civil Service
examinations and have been practising sanitary engineering for at least two years prior to the approval of this Act.
Article IV
ENFORCEMENT OF ACT AND PENAL PROVISIONS
Section 25. Enforcement of the Act and by Officers of the Law.- It shall be the duty of all duly constituted law
officers of the national, provincial, city and municipal governments or any political subdivision thereof, to enforce
the provisions of this Act and to prosecute any person violating the same.
Section 26. Registration Required.- Unless exempted from registration, no person shall practice or offer to practice
sanitary engineering in the Philippines without having obtain the proper certificate of registration from the Board of
Examiners for Sanitary Engineers.17
Section 27. Penal Provisions.- Any person who shall practice or offer to practice sanitary engineering in the
Philippines without being registered in accordance with the provisions of this Act, or any person presenting or
attempting to use as his own the certificate of registration of a registered sanitary engineer, or any person who shall
give any false or forged evidence of any kind to the Board, or any person who shall impersonate any registrant
sanitary engineer of different name, or any person who shall attempt to use a revoked or suspended certificate of
registration, or any person who shall use in connection with his name, or otherwise assume, use, or advertise any
title or description tending to convey the impression that he is a sanitary engineer, without holding a valid certificate
of registration, or any person who shall violate any of the provisions of this Act, shall be guilty of a misdemeanor
and shall, upon conviction, be sentenced to a fine of not less than five hundred pesos nor more than two thousand
pesos, or to suffer imprisonment for a period of not less than six months nor more than one year, or both, in the
discretion of the court.
Article V
MISCELLANEOUS PROVISIONS
Section 28. Field of Action Authorized for Sanitary Engineering; Prohibitions.- It shall be unlawful for any person,
unless exempted from registration under section twenty of this Act:
a. To be in responsible charge of the preparation of plans, designs, investigations, valuations, technical reports,
specification or estimates, or to be in performance of other sanitary engineering service, either for himself or for
others, unless he holds a valid certificate of registration as sanitary engineer.
b. To be in responsible charge of the construction, erection, installation or alteration, or of the performance of
sanitary engineering service in connection with the manufacture, sale supply or distribution of any sanitary
engineering works, projects or plant (as cited in article one, section two of this Act), either for himself or for others,
unless he holds a valid certificate of registration as sanitary engineer.
Section 29. Preparation of Plans and Supervision of Construction by Registered Sanitary Engineers Required.- It
shall be unlawful for any person or firm to order or otherwise cause the construction, erection, installation or
alteration of any sanitary engineering equipment, machinery or process for any sanitary engineering work, project or
plant, the cost of which exceeds five thousand pesos, unless the design, plans, layouts, and/or specifications have
been prepared under the responsible charge of, signed and sealed by a registered sanitary engineer, and/or alteration
thereof are executed under the responsible charge and direct supervision of a registered sanitary engineer.
Section 30. Firms and Corporations Engaged in Sanitary Engineering Practice.- A firm, partnership, corporation or
association may engage in the practice of sanitary engineering in the Philippines: Provided, That such practice is
carried out under the supervision of a sanitary engineer or sanitary engineers holding valid certificates issued by the
Board. No firm, partnership, corporation or association, using the name of a person or persons as in the name of
firm, shall advertise as sanitary engineers unless said person or persons are registered sanitary engineers.
Section 31. Collection of Professional Fees.- It shall be unlawful for any unregistered person to collect a fee for
services rendered except as an employee collecting a fee as representative of a registered sanitary engineer.
Section 32. Reciprocity Requirements.- No person who is not a citizen of the Philippines at the time he applies to
take examination shall be allowed to take it unless he can prove in the manner provided by the Rules of Court that,
by specific provision of law, the country of which he is a citizen, subject, or national either admits citizens of the
Philippines to the practice of the same profession without restriction or allows them to practice it after an
examination on terms of strict and absolute equality with citizens, subjects, or nationals of the country concerned,
including the unconditional recognition of degrees issued by institutions of learning duly recognized for the purpose
by the Government of the Philippines: Provided, That if he is not a citizen of the Philippines after December eight,
nineteen hundred and forty one, his active practice in that profession, either in the Philippines or in the state or
country where he was practising his profession, shall not have been interrupted for a period of two years or more
prior to July four, nineteen hundred and forty-six, and that the country or state from which he comes allows the
citizens of the Philippines by specific provisions of law, to practice the same profession without restrictions or on
terms of strict and absolute equality with citizens, subjects or national of the country or state concerned.
Section 33. Act Not Affecting Other Provisions and/or Trades.- This Act shall not be construed to affector prevent
the practice of any other legally recognized profession, and/or trade nor shall it be construed to diminish the fields of
practice already embraced by civil engineers duly registered under the Civil Engineering Law, Republic Act
Numbered Five hundred and forty four, or of those by duly licensed master plumbers under existing law.
Section 34. Construction of Act.- If any part or section of this Act shall be declared unconstitutional, such
declaration shall not invalidate the other provisions hereof.
Section 35. Effectivity.- This Act shall take effect upon its approval. Approved, June 18, 1955.
REPUBLIC ACT No. 3931
AN ACT CREATING THE NATIONAL WATER AND AIR POLLUTION CONTROL COMMISSION.
Section 1. Statement of Policy. It is hereby declared a national policy to maintain reasonable standards of purity for
the waters and air of this country with their utilization for domestic, agricultural, industrial and other legitimate
purposes.
Section 2. Definitions. As used in this Act:
(a) "Pollution" means such alteration of the physical, chemical and/or biological properties of any water and/or
atmospheric air of the Philippines, or any such discharge of any liquid, gaseous or solid substance into any of the
waters and/or atmospheric air of the country as will or is likely to create or render such waters and/or atmospheric
air harmful or detrimental or injurious to public health, safety or welfare, or to domestic, commercial, industrial,
agricultural, recreational or other legitimate uses, or to livestock, wild animals, birds, fish or other aquatic life.
(b) "Sewage" means the water-carried human or animal wastes from residences, buildings, industrial establishments,
or other places, together with such water infiltration and surface water as may be present. The admixture of sewage
as above defined and industrial wastes or other wastes as hereafter defined, shall be considered "sewage".
(c) "Industrial waste" means any liquid, gaseous or solid matter, or other waste substance or a combination thereof
resulting from any process of industry, manufacturing trade or business or from the development, processing or
recovery of any natural resources.
(d) "Other waste" means garbage, refuse, wood residues, sand, lime, cinders, ashes, offal, night-oil, tar, dye stuffs,
acids, chemicals, and other substances not sewage or industrial waste which may cause or tend to cause pollution, or
contribute to the pollution of the waters and/or atmospheric air of the Philippines.
(e) "Sewage system or sewerage system" means pipe lines or conduits, pumping stations, force mains, constructed
drainage ditches, and all other construction, devices, and appurtenances used for collecting or conducting sewage,
and industrial waste or other wastes to a point of ultimate disposal or discharge.
(f) "Treatment works" means any methods, construction, device or appliances appurtenant thereto, installed for the
purpose of treating neutralizing, stabilizing, disinfecting, or disposing of sewage, industrial waste or other wastes, or
for the recovery of by-product from such sewage, industrial waste or other wastes.
(g) "Sewage works" means individually or collectively those constructions or devices used for collecting pumping,
treating, and disposing of sewage, industrial waste or other wastes, or for the recovery of by-products from such
sewage, industrial waste or other wastes.
(h) "Outlet" means the terminus of a sewage works or point of emergence into the waters and/or atmospheric air of
the Philippines of any sewage, industrial waste or other wastes.
(i) "Waters of the Philippines" means all accumulations of water, surface and underground water, natural or
artificial, public or private or parts thereof, which are within the Philippines or within its jurisdiction.
(j) "Atmospheric air of the Philippines" means the air within the Philippines or within its jurisdiction.
(k) "Person" or "Persons" means any individual public or private corporation, political subdivision, government
agency, municipality, public or private institution, industry, co-partnership, association, firms, trust, or any other
entity whatsoever.
(l) "Stream standard" or stream standards" means such measure of purity or quality for any waters in the Philippines
in relation to their reasonable and necessary use.
(m) "Commission" means the National Water and Air Pollution Control Commission.
Section 3. Creation of the National Water and Air Pollution Control Commission; members; compensation; advisory
council. There is hereby created and established in the Office of the President of the Philippines, the National Water
and Air Pollution Control Commission, with permanent office in the City of Manila. The Commission shall be
composed of the Chairman of the National Science Development Board, as chairman, and, as members, four part-
time commissioners, one of whom shall be an officer of the Department of Health who shall be designated by the
Secretary of Health; another shall be an officer of the Department of Agriculture and National Resources, who shall
be designated by the Secretary of Agriculture and Natural Resources; and the remaining two shall be representatives
of the private sector who shall be appointed by the President of the Philippines with the consent of the Commission
on Appointments, one upon recommendation of the Philippine Council of Science and Technology, and the other
upon the recommendation of the Chamber of Industries of the Philippines; and two full-time commissioners who
shall likewise be appointed by the President of the Philippines, with the consent of the Commission on
Appointments. One of the full-time commissioners shall be a sanitary engineer; and the other a lawyer. Both shall
beat least thirty five-years of age and shall each have had at least ten years experience in the practice of his
profession.
The two part-time commissioners representing the private sector and the two full-time commissioners shall serve for
four years and until their successors shall have been appointed and qualified. They may not be removed except for
cause. Upon the death, resignation or removal of any of them, the President shall appoint a qualified person to fill
the vacancy for his unexpired term.
The chairman and members of the Commission, except the full-time commissioners, shall receive no compensation
for their services, but they shall receive per diems of fifty pesos each per meeting plus the necessary traveling
expenses incurred in the discharged of their duties as members of the Commission. The two full-time members shall
each receive a yearly compensation of eighteen thousand pesos. They shall also receive traveling expenses incurred
in the discharge of their duties as commissioners.
Section 4. Organization of the Commission; its offices; cooperation with other agencies; acceptance of donations.
The President of the Philippines shall organize the Commission within thirty days after the approval of this Act.
The Technical Secretary of the Commission shall be appointed by the Commission. He shall be a sanitary engineer
with at least five years experience in the technical and administrative fields of engineering. He shall be the active
administrator of all water and air pollution control activities of the Commission. The Technical Secretary shall,
during the interim between meetings of the Commission, handle such correspondence, make or arrange for such
inspections and investigations, and obtain, assemble or prepare such reports and data as the Commission may direct
or authorize. His compensation shall be determined by the Commission.
The Commission shall provide such technical scientific or other services, including the necessary laboratory and
other facilities as may be required for the purpose of carrying out the provisions of this Act. The basic personnel
necessary to carry out the provisions of this Act shall be engineers, chemists, bio-chemists, physicists, and other
technicians: Provided, That the Commission may, by agreement, secure such services as it may deem necessary
from other agencies of the National Government, and may make arrangements for the compensation of such
services. The Commission may also employ and compensate, within appropriations available therefor, such
consultants, experts, advisors, or assistants on a full or part-time basis as may be necessary, coming from
government or private business entities, associations, or from local or foreign organizations, to carry out the
provision of this Act and may prescribe their powers, duties, and responsibilities.
The Commission may conduct scientific experiments, investigations and research to discover economical and
practical methods of preventing water and air pollutions. To this end, the Commission may corporate with any
public or private agency in the conduct of such experiments, investigations and research and may accept, and receipt
for such money for and in behalf of the National Government, given by any international, national or other public or
private agency for water and air pollution control activities, surveys or programmes: Provided, That sums of money
shall be used only for the purpose for which they are contributed and any balance remaining after the conclusion of
experiments, investigations and research shall be returned to the contributors. The Commission is authorized to
promulgate such rules and regulations or enter into contracts as it may deem necessary for carrying out the
provisions of this Act.
Section 5. Meeting of the Commission, quorum. The Commission shall meet as often as necessary to carry into
effect the provisions of this Act and at times and places to be designated by the Chairman of the Commission, and
shall keep a complete record of the meetings which shall be kept on file in the office of the Technical Secretary, and
shall determine the rules of its own proceedings. Meetings may be called by the chairman upon his own initiative or
upon the written request of two or more members of the Commission. Written notice of the time and place of such
meetings shall be delivered to the office of each member of the Commission and the Technical Secretary. Four
members of the Commission shall constitute a quorum to transact the business of the Commission: Provided,
however, That the concurrence of the majority of all the members of the Commission shall be necessary to exercise
the powers and duties enumerated in Section six of this Act and to render any order, judgment or decision in the
proceedings referred to in section seven and eight hereof.
Section 6. Powers and duties. (a) The commission is hereby authorized to:
1. Determine if pollution exists in any of the waters and/or atmospheric air of the Philippines. Findings of the
Commission regarding the existence of pollution shall be filed on record in the office of the Commission.
2. Adopt, prescribe, and promulgate rules and regulations governing the procedures of the Commission with respect
to hearings; the methods and manner under which plans, specifications, designs, or other data relative thereto shall
be submitted for sewage works and industrial wastes disposal systems or for addition or change to or extensions of
such work; the filing of reports; the issuance of permits; and such other reasonable rules and regulations as may be
necessary from time to time in the proper implementation and enforcement of this Act.
3. Hold public hearings, receive pertinent and relevant proofs from any party in interest who appear before the
Commission, make findings of facts and determinations, all with respect to the violations of this Act or orders issued
by the Commission.
4. Make, alter or modify orders requiring the discontinuance of pollution of the waters and/or atmospheric air of the
Philippines due to the discharge of sewage, industrial wastes or other wastes and specifying the conditions and the
time within which such discontinuance must be accomplished.
5. Institute or cause to be instituted in a court of competent jurisdiction legal proceedings to compel compliance with
the provisions of this Act.
6. Issue, renew, or deny permits, under such conditions as it may determine to be reasonable, for the prevention and
abatement of pollution, for the discharge of sewage, industrial wastes or other wastes, or for the installation or
operation of sewage works and industrial disposal systems, or parts thereof, except that no permits shall be required
of any new sewage, works or changes to or extensions of existing works that discharge only domestic or sanitary
wastes from a single residential building housing or occupied by twenty pesos or less: Provided, however, That
applications for the issuance or renewal of permits required under this Act shall be filed with and decided by the city
engineer or district engineer of the city or province from which the discharge of industrial or other wastes shall
originate, in accordance with rules, regulations and standards to be issued by the Commission. In case of doubt, the
city or district engineer shall consult with the Commission before issuing, renewing, or denying the permit applied
for; and any decision of the city or district engineer may be appealed by the applicant or by any resident of the place
who may be affected by the discharge of waste to the Commission, under such rules and regulations as the
Commission shall issue for such appeals.
7. After due notice and hearing, revoke suspend or modify any permit issued under this Act, whenever modifications
are necessary to prevent or abate pollution of any water and/or atmospheric air of the Philippines.
8. Cause such investigation to be made as it may deem advisable and necessary for the discharge of its duties under
this Act.
9. Settle or compromise any dispute arising out of the implementation and enforcement of the second paragraph of
Section ten of this Act as it may seem advantageous to the public interest.
10. Perform such other duties as may be necessary to carry out effectively the duties and responsibilities prescribed
in this Act.
(b) The Commission shall have the following duties and responsibilities:
1. To encourage voluntary cooperation by the people, municipalities, industries, associations, agriculture and
representatives of other pursuits in the proper utilization and conservation of the waters and/or atmospheric air of the
Philippines.
2. To encourage the formation and organization of cooperative groups or associations in municipalities, industries,
enterprises and other users of the waters who severally and jointly are or may be the source of pollution of the same
waters, the purpose of which shall be to provide a medium to discuss and formulate plans for the prevention and
abatement of pollution.
3. To serve as arbitrator for the determination of reparations involved in the damages and losses resulting from the
pollution of the waters and/or air in the Philippines.
4. To devise, consult, participate, cooperate and enter into agreements with other agencies of the government, and
with affected political groups, political subdivisions, and enterprises in the furtherance of the purpose of this Act.
This particularly refers to such cooperative agreements with the various provincial and municipal governments in
securing their assistance in carrying out the provisions of this Act.
5. To prepare and develop a comprehensive plan for the abatement of existing pollution and prevention of new
and/or imminent pollution of the waters and/or atmospheric air of the Philippines.
6. To issue standards, rules and regulations to govern city and district engineers in the approval of plans and
specifications for sewage works and industrial wastes disposal systems and in the issuance of permits in accordance
with the provisions of this Act, and to inspect the construction and maintenance of sewage works and industrial
wastes disposal system for compliance of the approved plans.
7. To collect and disseminate information relating to water and atmosphere pollution and the prevention, abatement
and control thereof.
8. To authorize its representatives to enter at all reasonable times in or upon any property of the public dominion and
private property devoted to industrial, manufacturing, processing or commercial use without doing damages, for the
purpose of inspecting and investigating conditions relating to pollution or the possible or imminent pollution of any
waters or atmospheric air of the Philippines.
Section 7. Public Hearings. Public hearings shall be conducted by the Commission in connection with and prior to
action by the said Commission on the following cases:
(a) Any order or findings of the Commission requiring the discontinuance of discharge of sewage, industrial wastes
or other wastes into the waters or atmospheric air of the Philippines as provided for in this Act.
(b) Any order denying, revoking or modifying a permit as provided by this Act.
The hearing herein provided may be conducted by the Commission itself at a meeting of the Commission, or the
Commission may delegate to any member, or to the Technical Secretary the power and authority to conduct such
hearings in the name of the Commission at any time and place. In such hearings, any member of the Commission, or
the Technical Secretary may issue in the name of the Commission, notices of hearings requesting the attendance and
testimony of witnesses and the production of evidence relevant to any matter involved in any such hearing, and may
examine such witnesses. All stenographic transcript of the proceedings of said hearings shall be taken and filed with
the Commission.
Section 8. Proceedings before the Commission. The Commission may, on its own motion, or upon the request of
any person, investigate or may inquire, in a manner to be determined by it, as to any alleged act of pollution or the
omission or failure to comply with any provisions of this Act or any order of this Commission.
Whenever it appears to the Commission, after investigation, that there has been a violation of any of the provisions
of this Act or any order of the Commission, it may order whoever causes such violation to show cause before said
Commission why such discharge of industrial wastes or any waste should not be discounted. A notice shall be
served on the offending party directing him or it to show cause before the Commission, on a date specified in such
notice, why an order should not be made directing the discontinuance of such violation. Such notice shall specify the
time and the place where a public hearing will be held by the Commission or its authorized representatives, and
notice of such hearing shall be served personally or by registered mail, at least ten days before said hearing; and in
the case of a municipality or corporation such notice shall be served upon the mayor or president thereof. The
Commission shall take evidence with reference to said matter and may issue an order to the party responsible for
such violation, directing that within a specified period of time thereafter, such violation be discontinued unless
adequate sewage works or industrial wastes disposal system be properly operated to prevent further damage or
pollution.
No investigation being conducted or ruling made by the Commission shall prejudice any action which may be filed
in court by any person in accordance with the provisions of the New Civil Code on nuisance. On matters, however,
not related to nuisance, no court action shall be initiated until the Commission shall have finally ruled thereon and
no order of the Commission discontinuing the discharge of waste shall be stayed by the filing of said court action,
unless the court issues an injunction as provided for in this Rules of Court.
Section 9. Prohibitions. No person shall throw, run, drain, or otherwise dispose into any of the water and/or
atmospheric air of the Philippines, or cause, permit, suffer to be thrown, run, drain, allow to see or otherwise dispose
into such waters or atmospheric air, any organic or inorganic matter or any substance in gaseous or liquid form that
shall cause pollution of such waters or atmospheric air.
No person shall perform any of the following activities without first securing a permit from the city or district
engineer for the discharge of all industrial wastes and other wastes which are or may be discharged into the watersor
atmospheric air of the Philippines, which could cause pollution thereof:
(1) the construction, installation, modification or operation of any sewage works or any extension or addition
thereto;
(2) the increase in volume or strength of any wastes in excess of the permissive discharge specified under any
existing permit;
(3) the construction, installation, or operation of any industrial or commercial establishments or any extension or
modification thereof or addition thereto, the operation of which would cause an increase in the discharge of wastes
directly into the waters or atmospheric air of the Philippines or would otherwise alter the physical, chemical or
biological properties of any waters or atmospheric air of the Philippines in any manner not already lawfully
authorized;
(4) the construction or use of any new outlet for the discharge of any waste, gaseous or liquid, directly into the
waters or atmospheric air of the Philippines.
Section 10. Penalties. Any person who shall violate any of the provisions of Section nine of this Act or who violates
any order of the Commission, shall be liable to a penalty of not to exceed fifty pesos for each day during which the
violation continues, or by imprisonment of from two years to six years, or by both fine and imprisonment and in
addition such person may be required or enjoined from continuing such violation as hereinafter provided.
Any person who violates any of the provisions of, or fails to perform any duty imposed by this Act, or who violates
and order or other determination of the Commission promulgated pursuant to this Act, thereby causing the death of
fish or other aquatic life, or damages or destroys the natural habitat necessary for the propagation of fish or other
aquatic life, shall in addition to the penalty above prescribed, be liable to pay the government for damages for fish or
other aquatic life destroyed. The Commission after consultation with fishery officials of the Department of
Agriculture and Natural Resources shall, through a court of competent jurisdiction, bring an action against such
person and recover the reasonable value of the fish or other aquatic life and/or habitat destroyed by such pollution.
Any amount so recovered shall be placed in the funds made available to the Fisheries Commission.
Section 11. Jurisdiction. The Commission shall have no jurisdiction over waterworks or sewage systems operated by
the NAWASA but rules and regulations issued by the Commission for the protection and prevention of pollution of
the atmospheric air and water of the Philippines under the authority herein granted shall supersede and prevail over
any rules or regulations as may heretofore have been issued by the NAWASA or by the Department of Health on the
same subject matter.
Section 12. Appropriation. The sum of one million five hundred thousand pesos or so much thereof as may be
necessary is hereby authorized to be appropriated yearly for the operating expenses of the Commission as additional
appropriation to the yearly budget of the Office of the President of the Philippines.
Section 13. Repealing clause. Any Act or parts of Acts inconsistent with the provisions of this Act are hereby
repealed, without prejudice to the provisions of Republic Act Numbered Thirteen hundred seventy-eight.
Section 14. Effectivity. This Act shall take effect upon its approval.
Approved: June 18, 1964
CHAPTER V
MANAGEMENT AND PERSONNEL
Sec. 15. Incorporation. The members of the first Board of Directors shall be elected by the stockholders and the
incorporation shall be held to have been effected from the date of the first meeting of such Board.
Sec. 16. Board of Directors: Composition. The corporate powers shall be vested in and exercised by a Board of
Directors, hereinafter referred to as the Board, which shall be composed of eight (8) members, to wit: the Executive
Secretary, the Secretary of Economic Planning, the Secretary of Natural Resources, the Secretary of Industry, a
representative of Laguna Province, who shall be designated by the Provincial Board of Laguna; a representative of
Rizal Province to be designated by its Provincial Board; the General Manager of the Authority to be appointed by
the President of the Philippines, and a representative of the private investors, likewise to be appointed by the
President of the Philippines from among a list of recommendees to be submitted by the private investors: Provided,
That the incumbent representative of the private investors: shall continue as member until the President appoints his
successor. The Board of Directors shall elect annually from among their members a Chairman and a Vice Chairman.
There shall be a Corporate Secretary who shall be appointed the Board.
The officials next in rank to the above-mentioned member shall serve as permanent alternate members and shall
attend meetings of the Board in the absence of their principals and receive the corresponding per diems.
Sec. 17. Acting Chairman. In case of vacancy in the position of Chairman, or in the absence of or temporary
incapacity of the Chairman, the Vice-Chairman shall act as such until a new Chairman is duly elected by the Board.
Sec. 18. (This provision were repealed by PD 813, Section 19, promulgated on October 17, 1975.)
Sec. 19. (This provision were repealed by PD 813, Section 19, promulgated on October 17, 1975.)
Sec. 20. Effect of vacancies; quorum. Vacancies in the Board as long as there shall be four members in office, shall
not impair the powers of the Board to execute the functions of the Authority. The affirmative vote of four (4)
members of the Board shall be necessary at all times to pass or approve any act or resolution.
Sec. 21. Qualifications of Directors. All members of the Board shall be citizens and residents of the Philippines.
They shall have demonstrated executive competence and experience in the field of public administration, economic
planning, resource management, or in the establishment and management of large agricultural, industrial or
commercial enterprises. No person shall be nominated as member of the Board unless he be of unquestioned
integrity and competence.
Sec. 22. Prohibition against "Conflict of Interest." No person member of the Board shall be financially interested,
directly or indirectly, in any contract entered into by the Authority or in any special privileges granted by the
Authority during his term of office. All contracts entered into in violation of this provision shall automatically be
null and void. Any member of the Board found violating the provisions of this section by two-thirds (2/3) vote of the
Board shall automatically be disqualified from serving his unexpired term, and he shall furthermore be perpetually
disqualified for membership in the said Board.
Sec. 23. Removal, courtesy resignation. A member of the Board may be removed from office by a vote of the
stockholders holding or representing three-fourths (3/4) of the subscribed capital stock outstanding and entitled to
vote. No member of the Board shall be required to submit a courtesy resignation at any time during his term of
office.
Sec. 24. Board Meetings. The Board shall meet at least once a month. The Board shall be convoked by the
Chairman or upon written request signed by a majority of the members.
Sec. 25. Per Diems and Allowances. The members of the Board shall receive for every meeting attended a per diem
to be determined by the Board: Provided, That in no case will the total amount received by each exceed the sum of
One Thousand Pesos (P1,000.00) for any one month. Members of the Board shall be entitled to commutable
transportation and representation allowances in the performance of official functions for the Authority as authorized
by the Board the aggregate amount of which shall not exceed One Thousand Pesos (P1,000.00) for any one month.
Sec. 25-A. Powers and Functions of the Board of Directors.
a. To formulate, prescribe, amend and repeal rules and regulations to govern the conduct of business of the
Authority
b. To appoint and fix the compensation of all officials from division heads and above, and others of
comparable rank including the Assistant General Manager upon the recommendation of the General Manager;
c. By a majority vote of all members of the Board, to suspend, remove or otherwise discipline for just cause
all officials appointed by the Board;
d. To approve the annual and/or supplemental budgets of the Authority; and
e. To do such other acts and perform such other functions as may be necessary to carry out the provisions of
this Charter.
Sec. 26. Powers and Functions of the General Manager. The General Manager shall be the chief executive of the
Authority. As such, he shall have the following powers and duties:
a. Submit for consideration of the Board the policies and measures which he believes to be necessary to carry
out the purposes and provisions of this Act;
b. Execute and administer the policies, plans, programs and projects approved by the Board;
c. Direct and supervise the operation and internal administration of the Authority. The General Manager may
delegate certain of his administrative responsibilities to other officers of the Authority subject to the rules and
regulations of the Board.
d. Appoint officials and employees below the rank of division heads to positions in the approved budget upon
written recommendation of the division head concerned using as guide the standard set forth in the Authority's merit
system;
e. Submit quarterly reports to the Board on personnel selection, placement and training;
f. Submit to the NEDA an annual report and such other reports as may be required, including the details of
the annual and supplemental budgets of the Authority, and
g. Perform such other functions as may be provided by law.
Sec. 27. (This provision were repealed by PD 813, Section 18, promulgated on October 17, 1975.)
Sec. 28. (This provision were repealed by PD 813, Section 19, promulgated on October 17, 1975.)
Sec. 29. Compensation. The General Manager shall receive a compensation of at least Thirty-Six Thousand Pesos
(P36,000.00) per annum which shall be charged against the annual appropriation of the Authority for operating
expenses. The Board of Directors may provide per diems and allowances for the General Manager.
Sec. 30. Residence. The General Manager shall establish his residence within the region. The General Manager
shall not, during his term of office, engage in any business or profession or calling other than those connected in the
performance of his official duties as General Manager of the Authority.
Sec. 31. Activities of the Authority: Key Officials. In carrying out the activities of the Authority, the General
Manager shall be assisted by an Assistant General Manager who shall have such powers, duties, and functions that
may be delegated to him by the General Manager, and shall act as General Manager in the absence of or during the
temporary incapacity of and/or until such time as a new General Manager is duly appointed.
The Authority shall have the following divisions under the direct supervision and control of the General Manager;
a. An Administrative Division which shall be responsible for providing services relating to personnel,
training, information, records, supplies general services, equipment and security;
b. A legal Division, to be headed by a Legal Counsel who shall represent the Authority in legal actions and
proceedings. This division shall be responsible for providing staff advice and assistance on legal matters;
c. A Finance Division which shall be responsible for providing staff advice and assistance on budgetary and
financial matters, and safekeeping of corporate assets;
d. A Project Management Division which shall be responsible for the operation of approved projects, project
evaluation and management improvement matters;
e. A Planning and Project development Division which shall be responsible for providing services relating to
planning, programming, statistics and project development; and
f. An Engineering and Construction Division which shall be responsible for providing services relating to
detailed engineering plans and the construction and maintenance of project facilities.
The business and activities of each of these divisions shall be directed by an officer to be known as its division head.
The Board may create such other divisions and positions as may be deemed necessary for the efficient, economical
and effective conduct of the activities of the Authority.
Sec. 32. Merit and Compensation System. All officials, agents and employees of the Authority shall be selected and
appointed on the basis of merit and fitness in accordance with a comprehensive and progressive merit system to be
established by the Authority. The recruitment, transfer, promotion and dismissal of all personnel of the authority,
including temporary workers, shall be governed by such merit system: Provided, That the regular professional and
technical personnel of the Authority shall be exempt from the coverage of the classification and compensation plans
of the WAPCO and Civil Service rules and regulations: Provided, however, That such personnel shall be permanent
instates and shall be entitled to the benefits and privileges normally accorded to government employees, such as
retirement, GSIS insurance, leave and similar matters: Provided, further, That the Director General of the NEDA
shall review and recommend the approval of the staffing pattern for professional and technical personnel of the
Authority including modifications thereof as may be necessary for five years from the date of approval of this
Decree.
Sec. 33. (This provision were repealed by PD 813, Section 23, promulgated on October 17, 1975.)
Sec. 34. (This provision were repealed by PD 813, Section 24, promulgated on October 17, 1975.)
Sec. 34-A. Supervision by the NEDA. The Authority shall be directly under the NEDA for policy and
program integration.
Sec. 34-B. Submission of Financial Statement to NEDA. The Authority shall submit audited financial
statements to NEDA within 60 days after the close of the fiscal year, and it shall continue to operate on the basis of
not more than the preceding year's budget until the said financial statements shall have been submitted.
Sec. 34-C. Management Audit by the NEDA. The NEDA, may, at its own instance, initiate a management
audit of the Authority when there is a reasonable ground to believe that the affairs of the Authority have been
mismanaged. Should such audit indicate mismanagement, the NEDA shall take such appropriate measures as may
be required by circumstances.
Sec. 35. Minimum Wage. All contracts entered into by the Authority which require the employment of persons shall
contain provision that not less than the minimum wage fixed by law shall be paid to such persons so employed.
Sec. 36. Plans to be formulated within one year. Upon its organization, the Board of Directors shall formulate and
report to the stockholders with the utmost expeditious manner, but in no case longer than one year, its plans and
recommendations for the accelerated and balanced development of the region in accordance with the aims and
purposes of this Act.
Sec. 37. Supplies and services other than personnel. All purchases of supplies or contracts for services, except for
personnel services, entered into by the Authority shall be done only after the proper bidding is held. Bidding shall
not be required when: (1) the amount involved is five thousand pesos (P5,000.00) or less; (2) an emergency, as
certified to by the General Manager, requires immediate delivery of the supplies or performance of the services:
Provided, That in comparing bids and making awards, the Authority shall consider such factors as the cost and
relative quality and adaptability of supplies or services; the bidders' financial responsibility, skill, experience,
integrity, and ability to furnish repairs and maintenance services; the time of delivery or performance offered; and
the compliance with the specifications desired.
Sec. 38. Auditing. The Board of Directors shall provide and appoint an auditor who shall formulate an auditing
system for the Authority. The auditor shall make a semestral and/or annual report covering the financial conditions
and operation of the Authority to the Board. These auditing reports shall contain a statement of the resources and
liabilities, including earnings and expenses, the amount of paid-up capital stock, surplus, reserves, and profits, as
well as losses, bad debts and such other facts which, under auditing rules and regulations, are considered necessary
to accurately described the financial conditions and operation of the Authority. The auditor shall report and directly
responsible to the Board.
Sec. 39.
Sec. 39-A. Penal and Civil Liability Clause. Any person, natural or juridical, who shall violate any of the
provisions of this Act or any rules or regulation promulgated by the Authority pursuant thereto shall be liable to
imprisonment of not exceeding three years or to a fine not exceeding Five Thousand Pesos or both at the discretion
of the Court.
If the violator be a corporation, partnership or association, the officer or officers of the organization concerned shall
be liable therefor.
The authority is hereby authorized to pursue separate civil actions for damages resulting from infractions of the
provisions of this Act, rules or regulations issued pursuant thereto and/or conditions embodied in the clearances or
permits issued by the Authority.
Sec. 40. Separability Clause. The provisions of this Act are hereby declared to be separable, and in the event any
one or more such provisions are held unconstitutional, they shall not affect the validity of other provisions.
Sec. 40-A. Transitory Provision. When the Regional Development Council for the region becomes
operational, the socio-economic planning functions as envisioned under this Charter shall be assumed by the
aforementioned Regional Development Council in accordance with the provisions of the Integrated Reorganization
Plan, as amended. All incumbent officials and employees shall continue in office and those qualified shall have
preference in filling up new positions that may be created as consequence of this Decree.
Sec. 41. Definition of Terms.
1) Act Whenever used in this Act, shall refer to the enabling Act creating the Laguna Lake Development
Authority;
2) Authority Whenever cited in this Act shall mean the Laguna Lake Development Authority;
3) Board The word Board shall always refer to the Board of Directors of the Laguna Lake Development
Authority;
4) Region The word Region in this connection mean the Laguna Lake area proper comprising the provinces of
Rizal and Laguna and the cities of San Pablo, Manila, Pasay, Quezon and Caloocan;
5) Government instrumentalities or agencies or entities. Whenever used in this Act shall means instruments of
the national or local governments vested with powers to accomplish a definite government aim or purpose;
6) Municipal Corporation. Whenever used in this Act shall mean one that is organized for political purposes
with political powers exercised for the good of the public, subject to legislative control and with officers of the
government as its members to administer or discharge public duties;
7) Government Corporation. Whenever used shall refer to corporations engaged in performing functions
impressed with public interest;
8) Investor With regards to this Act, investors shall include public and private investors whether foreign or
local;
9) External Auditor. Shall mean a firm or a person hired outside the Authority or agency to audit the books of
accounts of another corporation or agency; examine financial records, prepare audit reports on findings in the
operation of the agency; review the statement on the performance report of the Authority.
10) Subsidiary Corporation. A corporation that is organized or a corporation already in existence wherein at
least fifty-one per cent of its shares of stock are owned or controlled by the organizing or subscribing Authority, in
this case, the Laguna Lake Development Authority, to carry out or accomplish its purposes.
11) Laguna Lake or Lake. Whenever Laguna Lake or lake is used in this Act, the same shall refer to Laguna de
Bay which is that area covered by the lake water when it is at the average annual maximum lake level of elevation
12.50 meters, as referred to a datum 10.00 meters below mean lower low water (M.L.L.W.). Lands located at and
below such elevation are public lands which form part of the bed of said lake.
Sec. 42. Laws repealed. All Acts, charters, executive orders, administrative orders, proclamations, rules and
regulations, or parts thereof in conflict with this Act are hereby repealed or modified accordingly.
Sec. 43. Effectivity. This Act shall take effect upon its approval.
Approved: July 18, 1966.
Section 3 Definition of Terms: As used in and for purposes of this Act, the following terms, whether in singular or
plural, shall mean:
a. Ancestral lands refers to all lands exclusively and actually possessed, occupied, or utilized by indigenous cultural
communities by themselves or through their ancestors in accordance with their customs and traditions since time
immemorial, and as may be defined and delineated by law.
b. Block or meridional block means an area bounded by one-half (1/2) minute of latitude and one-half (1/2) minute
of longitude, containing approximately eighty-one hectares (81 has.).
c. Bureau means the Mines and Geosciences Bureau under the Department of Environment and Natural Resources.
d. Carrying capacity refers to the capacity of natural and human environments to accommodate and absorb change
without experiencing conditions of instability and attendant degradation.
e. Contiguous zone refers to water, sea bottom and substratum measured twenty-four nautical miles (24 n.m.)
seaward from the base line of the Philippine archipelago.
f. Contract area means land or body of water delineated for purposes of exploration, development, or utilization of
the minerals found therein.
g. Contractor means a qualified person acting alone or in consortium who is a party to a mineral agreement or to a
financial or technical assistance agreement.
h. Co-production agreement (CA) means an agreement entered into between the Government and one or more
contractors in accordance with Section 26(b) hereof.
i. Department means the Department of Environment and Natural Resources.
j. Development means the work undertaken to explore and prepare an ore body or a mineral deposit for mining,
including the construction of necessary infrastructure and related facilities.
k. Director means the Director of the Mines and Geosciences Bureau.
l. Ecological profile or eco-profile refers to geographic-based instruments for planners and decision-makers which
presents an evaluation of the environmental quality and carrying capacity of an area.
m. Environmental compliance certificate (ECC) refers to the document issued by the government agency concerned
certifying that the project under consideration will not bring about an unacceptable environmental impact and that
the proponent has complied with the requirements of the environmental impact statement system.
n. Environmental impact statement (EIS) is the document which aims to identify, predict, interpret, and
communicate information regarding changes in environmental quality associated with a proposed project and which
examines the range of alternatives for the objectives of the proposal and their impact on the environment.
o. Exclusive economic zone means the water, sea bottom and subsurface measured from the baseline of the
Philippine archipelago up to two hundred nautical miles (200 n.m.) offshore.
p. Existing mining/quarrying right means a valid and subsisting mining claim or permit or quarry permit or any
mining lease contract or agreement covering a mineralized area granted/issued under pertinent mining laws.
q. Exploration means the searching or prospecting for mineral resources by geological, geochemical or geophysical
surveys, remote sensing, test pitting, trenching, drilling, shaft sinking, tunneling or any other means for the purpose
of determining the existence, extent, quantity and quality thereof and the feasibility of mining them for profit.
r. Financial or technical assistance agreement means a contract involving financial or technical assistance for large-
scale exploration, development, and utilization of mineral resources.
s. Force majeure means acts or circumstances beyond the reasonable control of contractor including, but not limited
to, war, rebellion, insurrection, riots, civil disturbance, blockade, sabotage, embargo, strike, lockout, any dispute
with surface owners and other labor disputes, epidemic, earthquake, storm, flood or other adverse weather
conditions, explosion, fire, adverse action by government or by any instrumentality or subdivision thereof, act of
God or any public enemy and any cause that herein describe over which the affected party has no reasonable control.
t. Foreign-owned corporation means any corporation, partnership, association, or cooperative duly registered in
accordance with law in which less than fifty per centum (50%) of the capital is owned by Filipino citizens.
u. Government means the government of the Republic of the Philippines.
v. Gross output means the actual market value of minerals or mineral products from its mining area as defined in the
National Internal Revenue Code.
w. Indigenous cultural community means a group or tribe of indigenous Filipinos who have continuously lived as
communities on communally-bounded and defined land since time immemorial and have succeeded in preserving,
maintaining, and sharing common bonds of languages, customs, traditions, and other distinctive cultural traits, and
as may be defined and delineated by law.
x. Joint venture agreement (JVA) means an agreement entered into between the Government and one or more
contractors in accordance with Section 26(c) hereof.
y. Mineral processing means the milling, beneficiation or upgrading of ores or minerals and rocks or by similar
means to convert the same into marketable products.
z. Mine wastes and tailings shall mean soil and rock materials from surface or underground mining and milling
operations with no economic value to the generator of the same.
aa. Minerals refers to all naturally occurring inorganic substance in solid, gas, liquid, or any intermediate state
excluding energy materials such as coal, petroleum, natural gas, radioactive materials, and geothermal energy.
ab. Mineral agreement means a contract between the government and a contractor, involving mineral production-
sharing agreement, co-production agreement, or joint-venture agreement.
ac. Mineral land means any area where mineral resources are found.
ad. Mineral resource means any concentration of minerals/rocks with potential economic value.
ae. Mining area means a portion of the contract area identified by the contractor for purposes of development,
mining, utilization, and sites for support facilities or in the immediate vicinity of the mining operations.
af. Mining operation means mining activities involving exploration, feasibility, development, utilization, and
processing.
ag. Non-governmental organization (NGO) includes nonstock, nonprofit organizations involved in activities dealing
with resource and environmental conservation, management and protection.
ah. Net assets refers to the property, plant and equipment as reflected in the audited financial statement of the
contractor net of depreciation, as computed for tax purposes, excluding appraisal increase and construction in
progress.
ai. Offshore means the water, sea bottom and subsurface from the shore or coastline reckoned from the mean low
tide level up to the two hundred nautical miles (200 n.m.) exclusive economic zone including the archipelagic sea
and contiguous zone.
aj. Onshore means the landward side from the mean tide elevation, including submerged lands in lakes, rivers and
creeks.
ak. Ore means a naturally occurring substance or material from which a mineral or element can be mined and/or
processed for profit.
al. Permittee means the holder of an exploration permit.
am. Pollution control and infrastructure devices refers to infrastructure, machinery, equipment and/or improvements
used for impounding, treating or neutralizing, precipitating, filtering, conveying and cleansing mine industrial waste
and tailings as well as eliminating or reducing hazardous effects of solid particles, chemicals, liquids or other
harmful byproducts and gases emitted from any facility utilized in mining operations for their disposal.
an. President means the President of the Republic of the Philippines.
ao. Private land refers to any land belonging to any private person which includes alienable and disposable land
being claimed by a holder, claimant, or occupant who has already acquired a vested right thereto under the law,
although the corresponding certificate or evidence of title or patent has not been actually issued.
ap. Public land refers to lands of the public domain which have been classified as agricultural lands and subject to
management and disposition or concession under existing laws.
aq. Qualified person means any citizen of the Philippines with capacity to contract, or a corporation, partnership,
association, or cooperative organized or authorized for the purpose of engaging in miring, with technical and
financial capability to undertake mineral resources development and duly registered in accordance with law at least
sixty per centum (60%) of the capital of which is owned by citizens of the Philippines: Provided, That a legally
organized foreign-owned corporation shall be deemed a qualified person for purposes of granting an exploration
permit, financial or technical assistance agreement or mineral processing permit.
ar. Quarrying means the process of extracting, removing and disposing quarry resources found on or underneath the
surface of private or public land.
as. Quarry permit means a document granted to a qualified person for the extraction and utilization of quarry
resources on public or private lands.
at. Quarry resources refers to any common rock or other mineral substances as the Director of Mines and
Geosciences Bureau may declare to be quarry resources such as, but not limited to, andesite, basalt, conglomerate,
coral sand, diatomaceous earth, diorite, decorative stones, gabbro, granite, limestone, marble, marl, red burning
clays for potteries and bricks, rhyolite, rock phosphate, sandstone, serpentine, shale, tuff, volcanic cinders, and
volcanic glass: Provided, That such quarry resources do not contain metals or metallic constituents and/or other
valuable minerals in economically workable quantities: Provided, further, That non-metallic minerals such as kaolin,
feldspar, bull quartz, quartz or silica, sand and pebbles, bentonite, talc, asbestos, barite, gypsum, bauxite, magnesite,
dolomite, mica, precious and semi-precious stones, and other non-metallic minerals that may later be discovered and
which the: Director declares the same to be of economically workable quantities, shall not be classified under the
category of quarry resources.
au. Regional director means the regional director of any mines regional office under the Department of Environment
and Natural Resources.
av. Regional office means any of the mines regional offices of the Department of Environment and Natural
Resources.
aw. Secretary means the Secretary of the Department of Environment and Natural Resources.
ax. Special allowance refers to payment to the claim-owners or surface right-owners particularly during the
transition period from Presidential Decree No. 463 and Executive Order No. 279, series of 1987.
ay. State means the Republic of the Philippines.
az. Utilization means the extraction or disposition of minerals.
CHAPTER II
GOVERNMENT MANAGEMENT
Section 4 Ownership of Mineral Resources: Mineral resources are owned by the State and the exploration,
development, utilization, and processing thereof shall be under its full control and supervision. The State may
directly undertake such activities or it may enter into mineral agreements with contractors.
The State shall recognize and protect the rights of the indigenous cultural communities to their ancestral lands as
provided for by the Constitution.
Section 5 Mineral Reservations: When the national interest so requires, such as when there is a need to preserve
strategic raw materials for industries critical to national development, or certain minerals for scientific, cultural or
ecological value, the President may establish mineral reservations upon the recommendation of the Director through
the Secretary. Mining operations in existing mineral reservations and such other reservations as may thereafter be
established, shall be undertaken by the Department or through a contractor: Provided, That a small scale-mining
cooperative covered by Republic Act No. 7076 shall be given preferential right to apply for a small-scale mining
agreement for a maximum aggregate area of twenty-five percent (25%) of such mineral reservation, subject to valid
existing mining/quarrying rights as provided under Section 112 Chapter XX hereof. All submerged lands within the
contiguous zone and in the exclusive economic zone of the Philippines are hereby declared to be mineral
reservations.
A ten per centum (10%) share of all royalties and revenues to be derived by the government from the development
and utilization of the mineral resources within mineral reservations as provided under this Act shall accrue to the
Mines and Geosciences Bureau to be allotted for special projects and other administrative expenses related to the
exploration and development of other mineral reservations mentioned in Section 6 hereof.
Section 6 Other Reservations:
Mining operations in reserved lands other than mineral reservations may be undertaken by the Department, subject
to limitations as herein provided. In the event that the Department cannot undertake such activities, they may be
undertaken by a qualified person in accordance with the rules and regulations promulgated by the Secretary. The
right to develop and utilize the minerals found therein shall be awarded by the President under such terms and
conditions as recommended by the Director and approved by the Secretary: Provided, That the party who undertook
the exploration of said reservation shall be given priority. The mineral land so awarded shall be automatically
excluded from the reservation during the term of the agreement: Provided, further, That the right of the lessee of a
valid mining contract existing within the reservation at the time of its establishment shall not be prejudiced or
impaired.
Section 7 Periodic Review of Existing Mineral Reservations: The Secretary shall periodically review existing
mineral reservations for the purpose of determining whether their continued existence is consistent with the national
interest, and upon his recommendation, the President may, by proclamation, alter or modify the boundaries thereof
or revert the same to the public domain without prejudice to prior existing rights.
Section 8 Authority of the Department: The Department shall be the primary government agency responsible for the
conservation, management, development, and proper use of the State's mineral resources including those in
reservations, watershed areas, and lands of the public domain. The Secretary shall have the authority to enter into
mineral agreements on behalf of the Government upon the recommendation of the Director, promulgate such rules
and regulations as may be necessary to implement the intent and provisions of this Act.
Section 9 Authority of the Bureau: The Bureau shall have direct charge in the administration and disposition of
mineral lands and mineral resources and shall undertake geological, mining, metallurgical, chemical, and other
researches as well as geological and mineral exploration surveys. The Director shall recommend to the Secretary the
granting of mineral agreements to duly qualified persons and shall monitor the compliance by the contractor of the
terms and conditions of the mineral agreements. The Bureau may confiscate surety, performance and guaranty bonds
posted through an order to be promulgated by the Director. The Director may deputize, when necessary, any
member or unit of the Philippine National Police, barangay, duly registered non-governmental organization (NGO)
or any qualified person to police all mining activities.
Section 10 Regional Offices: There shall be as many regional offices in the country as may be established by the
Secretary, upon the recommendation of the Director.
Section 11 Processing of Applications: The system of processing applications for mining rights shall be prescribed
in the rules and regulations of this Act.
Section 12 Survey, Charting and Delineation of Mining Areas: A sketch plan or map of the contract or mining area
prepared by a deputized geodetic engineer suitable for publication purposes shall be required during the filing of a
mineral agreement or financial or technical assistance agreement application. Thereafter, the contract or mining area
shall be surveyed and monumented by a deputized geodetic engineer or bureau geodetic engineer and the survey
plan shall be approved by the Director before the approval of the mining feasibility.
Section 13 Meridional Blocks: For purposes of the delineation of the contract or mining areas under this Act, the
Philippine territory and its exclusive economic zone shall be divided into meridional blocks of one-half (1/2) minute
of latitude and one-half (1/2) minute of longitude.
Section 14 Recording System: There shall be established a national and regional filing and recording system. A
mineral resource database system shall be set up in the Bureau which shall include, among others, a mineral rights
management system. The Bureau shall publish at least annually, a mineral gazette of nationwide circulation
containing among others, a current list of mineral rights, their location in the map, mining rules and regulations,
other official acts affecting mining, and other information relevant to mineral resources development. A system and
publication fund shall be included in the regular budget of the Bureau.
CHAPTER III
SCOPE OF APPLICATION
Section 15 Scope of Application: This Act shall govern the exploration, development, utilization and processing of
all mineral resources.
Section 16 Opening of Ancestral Lands for Mining Operations: No ancestral land shall be opened for mining-
operations without prior consent of the indigenous cultural community concerned.
Section 17 Royalty Payments for Indigenous Cultural Communities: In the event of an agreement with an
indigenous cultural community pursuant to the preceding section, the royalty payment, upon utilization of the
minerals shall be agreed upon by the parties. The said royalty shall form part of a trust fund for the socioeconomic
well-being of the indigenous cultural community.
Section 18 Areas Open to Mining Operations: Subject to any existing rights or reservations and prior agreements of
all parties, all mineral resources in public or private lands, including timber or forestlands as defined in existing
laws, shall be open to mineral agreements or financial or technical assistance agreement applications. Any conflict
that may arise under this provision shall be heard and resolved by the panel of arbitrators.
Section 19 Areas Closed to Mining Applications: Mineral agreement or financial or technical assistance agreement
applications shall not be allowed:
a. In military and other government reservations, except upon prior written clearance by the government agency
concerned;
b. Near or under public or private buildings, cemeteries, archeological and historic sites, bridges, highways,
waterways, railroads, reservoirs, dams or other infrastructure projects, public or private works including plantations
or valuable crops, except upon written consent of the government agency or private entity concerned;
c. In areas covered by valid and existing mining rights;
d. In areas expressedly prohibited by law;
e. In areas covered by small-scale miners as defined by law unless with prior consent of the small-scale miners, in
which case a royalty payment upon the utilization of minerals shall be agreed upon by the parties, said royalty
forming a trust fund for the socioeconomic development of the community concerned; and
f. Old growth or virgin forests, proclaimed watershed forest reserves, wilderness areas, mangrove forests, mossy
forests, national parks provincial/municipal forests, parks, greenbelts, game refuge and bird sanctuaries as defined
by law and in areas expressly prohibited under the National Integrated Protected Areas System (NIPAS) under
Republic Act No. 7586, Department Administrative Order No. 25, series of 1992 and other laws.
CHAPTER IV
EXPLORATION PERMIT
Section 20 Exploration Permit: An exploration permit grants the right to conduct exploration for all minerals in
specified areas. The Bureau shall have the authority to grant an exploration Permit to a qualified person.
Section 21 Terms and Conditions of the Exploration Permit: An exploration permit shall be for a period of two (2)
years, subject to annual review and relinquishment or renewal upon the recommendation of the Director.
Section 22 Maximum Areas for Exploration Permit: The maximum area that a qualified person may hold at any one
time shall be:
a. Onshore, in any one province
1. for individuals, twenty (20) blocks: and
2. for partnerships, corporations, cooperatives, or associations, two hundred (200) blocks.
b. Onshore, in the entire Philippines
1. for individuals, forty (40) blocks; and
2. for partnerships, corporations, cooperatives, or associations, four hundred (400) blocks.
c. Offshore, beyond five hundred meters (500m) from the mean low tide level:
1. for individuals, one hundred (100) blocks; and
2. for partnerships, corporations, cooperatives, or associations, one thousand (1,000) blocks.
Section 23 Rights and Obligations of the Permittee: An exploration permit shall grant to the permittee, his heirs or
successors-in-interest, the right to enter, occupy and explore the area: Provided, That if private or other parties are
affected, the permittee shall first discuss with the said parties the extent, necessity, and manner of his entry,
occupation and exploration and in case of disagreement, a panel of arbitrators shall resolve the conflict or
disagreement.
The permittee shall undertake an exploration work on the area as specified by its permit based on an approved work
program.
Any expenditure in excess of the yearly budget of the approved work program may be carried forward and credited
to the succeeding years covering the duration of the permit. The Secretary, through the Director, shall promulgate
rules and regulations governing the terms and conditions of the permit.
The permittee may apply for a mineral production sharing agreement, joint venture agreement, co-production
agreement or financial or technical assistance agreement over the permit area, which application shall be granted if
the permittee meets the necessary qualifications and the terms and conditions of any such agreement: Provided, That
the exploration period covered by the exploration permit shall be included as part of the exploration period of the
mineral agreement or financial or technical assistance agreement.
Section 24 Declaration of Mining Project Feasibility:
A holder of an exploration permit who determines the commercial viability of a project covering a mining area may,
within the term of the permit, file with the Bureau a declaration of mining project feasibility accompanied by a work
program for development. The approval of the mining project feasibility and compliance with other requirements
provided in this Act shall entitle the holder to an exclusive right to a mineral production sharing agreement or other
mineral agreements or financial or technical assistance agreement.
Section 25 Transfer or Assignment: An exploration permit may be transferred or assigned to a qualified person
subject to the approval of the Secretary upon the recommendation of the Director.
CHAPTER V
MINERAL AGREEMENTS
Section 26 Modes of Mineral Agreement: For purposes of mining operations, a mineral agreement may take the
following forms as herein defined:
a. Mineral production sharing agreement is an agreement where the Government grants to the contractor the
exclusive right to conduct mining operations within a contract area and shares in the gross output. The contractor
shall provide the financing, technology, management and personnel necessary for the implementation of this
agreement.
b. Co-production agreement is an agreement between the Government and the contractor wherein the Government
shall provide inputs to the mining operations other than the mineral resource.
c. Joint venture agreement is an agreement where a joint-venture company is organized by the Government and the
contractor with both parties having equity shares. Aside from earnings in equity, the Government shall be entitled to
a share in the gross output.
A mineral agreement shall grant to the contractor the exclusive right to conduct mining operations and to extract all
mineral resources found in the contract area. In addition, the contractor may be allowed to convert his agreement
into any of the modes of mineral agreements or financial or technical assistance agreement covering the remaining
period of the original agreement subject to the approval of the Secretary.
Section 27 Eligibility: A qualified person may enter into any of the three (3) modes of mineral agreement with the
government for the exploration, development and utilization of mineral resources: Provided, That in case the
applicant has been in the mining industry for any length of time, he should possess a satisfactory environmental
track record as determined by the Mines and Geosciences Bureau and in consultation with the Environmental
Management Bureau of the Department.
Section 28 Maximum Areas for Mineral Agreement: The maximum area that a qualified person may hold at any
time under a mineral agreement shall be:
a. Onshore, in any one province
1. for individuals, ten (10) blocks; and
2. for partnerships, cooperatives, associations, or corporations, one hundred (100) blocks.
b. Onshore, in the entire Philippines
1. for individuals, twenty (20) blocks; and
2. for partnerships, cooperatives, associations, or corporations, two hundred (200) blocks.
c. Offshore, in the entire Philippines
1. for individuals fifty (50) blocks;
2. for partnerships, cooperatives, associations, or corporations, five hundred (500) blocks; and
3. for the exclusive economic zone, a larger area to be determined by the Secretary.
The maximum areas mentioned above that a contractor may hold under a mineral agreement shall not include
mining/quarry areas under operating agreements between the contractor and a claimowner/lessee/permittee/licensee
entered into under Presidential Decree No. 463.
Section 29 Filing and Approval of Mineral Agreements: All proposed mineral agreements shall be filed in the
region where the areas of interest are located, except in mineral reservations which shall be filed with the Bureau.
The filing of a proposal for a mineral agreement shall give the proponent the prior right to areas covered by the
same. The proposed mineral agreement will be approved by the Secretary and copies thereof shall be submitted to
the President. Thereafter, the President shall provide a list to Congress of every approved mineral agreement within
thirty (30) days from its approval by the Secretary.
Section 30 Assignment/Transfer: Any assignment or transfer of rights and obligations under any mineral agreement
except a financial or technical assistance agreement shall be subject to the prior approval of the Secretary. Such
assignment or transfer shall be deemed automatically approved if not acted upon by the Secretary within thirty (30)
working days from official receipt thereof, unless patently unconstitutional or illegal.
Section 31 Withdrawal from Mineral Agreements: The contractor may, by giving due notice at any time during the
term of the agreement, apply for the cancellation of the mineral agreement due to causes which, in the opinion of the
contractor, make continued mining operations no longer feasible or viable. The Secretary shall consider the notice
and issue its decision within a period of thirty (30) days: Provided, That the contractor has met all its financial, fiscal
and legal obligations.
Section 32 Terms: Mineral agreements shall have a term not exceeding twenty-five (25) years to start from the date
of execution thereof, and renewable for another term not exceeding twenty-five (25) years under the same terms and
conditions thereof, without prejudice to changes mutually agreed upon by the parties. After the renewal period, the
operation of the mine may be undertaken by the Government or through a contractor. The contract for the operation
of a mine shall be awarded to the highest bidder in a public bidding after due publication of the notice thereof:
Provided, That the contractor shall have the right to equal the highest bid upon reimbursement of all reasonable
expenses of the highest bidder.
CHAPTER VI
FINANCIAL OR TECHNICAL ASSISTANCE AGREEMENT
Section 33 Eligibility: Any qualified person with technical and financial capability to undertake large-scale
exploration, development, and utilization of mineral resources in the Philippines may enter into a financial or
technical assistance agreement directly with the Government through the Department.
Section 34 Maximum Contract Area: The maximum contract area that may be granted per qualified person, subject
to relinquishment shall be:
a. 1,000 meridional blocks onshore;
b. 4,000 meridional blocks offshore; or
c. Combinations of a and b provided that it shall not exceed the maximum limits for onshore and offshore areas.
Section 35 Terms and Conditions: The following terms, conditions, and warranties shall be incorporated in the
financial or technical assistance agreement, to wit:
a. A firm commitment in the form of a sworn statement, of an amount corresponding to the expenditure obligation
that will be invested in the contract area: Provided, That such amount shall be subject to changes as may be provided
for in the rules and regulations of this Act;
b. A financial guarantee bond shall be posted in favor of the Government in an amount equivalent to the expenditure
obligation of the applicant for any year;
c. Submission of proof of technical competence, such as, but not limited to, its track record in mineral resource
exploration, development, and utilization; details of technology to be employed in the proposed operation; and
details of technical personnel to undertake the operation;
d. Representations and warranties that the applicant has all the qualifications and none of the disqualifications for
entering into the agreement;
e. Representations and warranties that the contractor has or has access to all the financing, managerial and technical
expertise and, if circumstances demand, the technology required to promptly and effectively carry out the objectives
of the agreement with the understanding to timely deploy these resources under its supervision pursuant to the
periodic work programs and related budgets, when proper, providing an exploration period up to two (2) years,
extendible for another two (2) years but subject to annual review by the Secretary in accordance with the
implementing rules and regulations of this Act, and further, subject to the relinquishment obligations;
f. Representations and warranties that, except for payments for dispositions for its equity, foreign investments in
local enterprises which are qualified for repatriation, and local supplier's credits and such other generally accepted
and permissible financial schemes for raising funds for valid business purposes, the contractor shall not raise any
form of financing from domestic sources of funds, whether in Philippine or foreign currency, for conducting its
mining operations for and in the contract area;
g. The mining operations shall be conducted in accordance with the provisions of this Act and its implementing rules
and regulations;
h. Work programs and minimum expenditures commitments;
i. Preferential use of local goods and services to the maximum extent practicable;
j. A stipulation that the contractors are obligated to give preference to Filipinos in all types of mining employment
for which they are qualified and that technology shall be transferred to the same;
k. Requiring the proponent to effectively use appropriate anti-pollution technology and facilities to protect the
environment and to restore or rehabilitate mined out areas and other areas affected by mine tailings and other forms
of pollution or destruction;
l. The contractors shall furnish the Government records of geologic, accounting, and other relevant data for its
mining operations, and that book of accounts and records shall be open for inspection by the government;
m. Requiring the proponent to dispose of the minerals and byproducts produced under a financial or technical
assistance agreement at the highest price and more advantageous terms and conditions as provided for under the
rules and regulations of this Act;
n. Provide for consultation and arbitration with respect to the interpretation and implementation of the terms and
conditions of the agreements; and
o. Such other terms and conditions consistent with the Constitution and with this Act as the Secretary may deem to
be for the best interest of the State and the welfare of the Filipino people.
Section 36 Negotiations: A financial or technical assistance agreement shall be negotiated by the Department and
executed and approved by the President. The President shall notify Congress of all financial or technical assistance
agreements within thirty (30) days from execution and approval thereof.
Section 37 Filing and Evaluation of Financial or Technical Assistance Agreement Proposals: All financial or
technical assistance agreement proposals shall be filed with the Bureau after payment of the required processing
fees. If the proposal is found to be sufficient and meritorious in form and substance after evaluation, it shall be
recorded with the appropriate government agency to give the proponent the prior right to the area covered by such
proposal: Provided, That existing mineral agreements, financial or technical assistance agreements and other mining
rights are not impaired or prejudiced thereby. The Secretary shall recommend its approval to the President.
Section 38 Term of Financial or Technical Assistance Agreement: A financial or technical assistance agreement
shall have a term not exceeding twenty-five (25) years to start from the execution thereof, renewable for not more
than twenty-five (25) years under such terms and conditions as may be provided by law.
Section 39 Option to Convert into a Mineral Agreement: The contractor has the option to convert the financial or
technical assistance agreement to a mineral agreement at any time during the term of the agreement, if the economic
viability of the contract area is found to be inadequate to justify large-scale mining operations, after proper notice to
the Secretary as provided for under the implementing rules and regulations: Provided, That the mineral agreement
shall only be for the remaining period of the original agreement.
In the case of a foreign contractor, it shall reduce its equity to forty percent (40%) in the corporation, partnership,
association, or cooperative. Upon compliance with this requirement by the contractor, the Secretary shall approve
the conversion and execute the mineral production-sharing agreement.
Section 40 Assignment/Transfer: A financial or technical assistance agreement may be assigned or transferred, in
whole or in part, to a qualified person subject to the prior approval of the President: Provided, That the President
shall notify Congress of every financial or technical assistance agreement assigned or converted in accordance with
this provision within thirty (30) days from the date of the approval thereof.
Section 41 Withdrawal from Financial or Technical Assistance Agreement: The contractor shall manifest in writing
to the Secretary his intention to withdraw from the agreement, if in his judgment the mining project is no longer
economically feasible, even after he has exerted reasonable diligence to remedy the cause or the situation. The
Secretary may accept the withdrawal: Provided, That the contractor has complied or satisfied all his financial, fiscal
or legal obligations.
CHAPTER VII
SMALL-SCALE MINING
Section 42 Small-scale Mining: Small-scale mining shall continue to be governed by Republic Act No. 7076 and
other pertinent laws.
CHAPTER VIII
QUARRY RESOURCES
Section 43 Quarry Permit: Any qualified person may apply to the provincial/city mining regulatory board for a
quarry permit on privately-owned lands and/or public lands for building and construction materials such as marble,
basalt, andesite, conglomerate, tuff, adobe, granite, gabbro, serpentine, inset filling materials, clay for ceramic tiles
and building bricks, pumice, perlite and other similar materials that are extracted by quarrying from the ground. The
provincial governor shall grant the permit after the applicant has complied with all the requirements as prescribed by
the rules and regulations.
The maximum area which a qualified person may hold at any one time shall be five hectares (5 has.): Provided, That
in large-scale quarry operations involving cement raw materials, marble, granite, sand and gravel and construction
aggregates, a qualified person and the government may enter into a mineral agreement as defined herein.
A quarry permit shall have a term of five (5) years, renewable for like periods but not to exceed a total term of
twenty-five (25) years. No quarry permit shall be issued or granted on any area covered by a mineral agreement or
financial or technical assistance agreement.
Section 44 Quarry Fee and Taxes: A permittee shall, during the term of his permit, pay a quarry fee as provided for
under the implementing rules and regulations. The permittee shall also pay the excise tax as provided by pertinent
laws.
Section 45 Cancellation of Quarry Permit: A quarry permit may be cancelled by the provincial governor for
violations of the provisions of this Act or its implementing rules and regulations or the terms and conditions of said
permit: Provided, That before the cancellation of such permit, the holder thereof shall be given the opportunity to be
heard in an investigation conducted for the purpose.
Section 46 Commercial Sand and Gravel Permit: Any qualified person may be granted a permit by the provincial
governor to extract and remove sand and gravel or other loose or unconsolidated materials which are used in their
natural state, without undergoing processing from an area of not more than five hectares (5 has.) and in such
quantities as may be specified in the permit.
Section 47 Industrial Sand and Gravel Permit: Any qualified person may be granted an industrial sand and gravel
permit by the Bureau for the extraction of sand and gravel and other loose or unconsolidated materials that
necessitate the use of mechanical processing covering an area of more than five hectares (5 has.) at any one time.
The permit shall have a term of five (5) years, renewable for a like period but not to exceed a total term of twenty-
five (25) years.
Section 48 Exclusive Sand and Gravel Permit: Any qualified person may be granted an exclusive sand and gravel
permit by the provincial governor to quarry and utilize sand and gravel or other loose or unconsolidated materials
from public lands for his own use, provided that there will be no commercial disposition thereof.
A mineral agreement or a financial technical assistance agreement contractor shall, however, have the right to
extract and remove sand and gravel and other loose unconsolidated materials without need of a permit within the
area covered by the mining agreement for the exclusive use in the mining operations: Provided, That monthly
reports of the quantity of materials extracted therefrom shall be submitted to the mines regional office concerned:
Provided, further, That said right shall be coterminous with the expiration of the agreement.
Holders of existing mining leases shall likewise have the same rights as that of a contractor: Provided, That said
right shall be coterminous with the expiry dates of the lease.
Section 49 Government Gratuitous Permit: Any government entity or instrumentality may be granted a gratuitous
permit by the provincial governor to extract sand and gravel, quarry or loose unconsolidated materials needed in the
construction of building and/or infrastructure for public use or other purposes over an area of not more than two
hectares (2 has.) for a period coterminous with said construction.
Section 50 Private Gratuitous Permit: Any owner of land may be granted a private gratuitous permit by the
provincial governor.
Section 51 Guano Permit: Any qualified person may be granted a guano permit by the provincial governor to extract
and utilize loose unconsolidated guano and other organic fertilizer materials in any portion of a municipality where
he has established domicile. The permit shall be for specific caves and/or for confined sites with locations verified
by the Department's field officer in accordance with existing rules and regulations.
Section 52 Gemstone Gathering Permit: Any qualified person may be granted a non-exclusive gemstone gathering
permit by the provincial governor to gather loose stones useful as gemstones in rivers and other locations.
CHAPTER IX
TRANSPORT, SALE AND PROCESSING OF MINERALS
Section 53 Ore Transport Permit: A permit specifying the origin and quantity of non-processed mineral ores or
minerals shall be required for their transport. Transport permits shall be issued by the mines regional director who
has jurisdiction over the area where the ores were extracted. In the case of mineral ores or minerals being
transported from the small-scale mining areas to the custom mills or processing plants, the Provincial Mining
Regulatory Board (PMRB) concerned shall formulate their own policies to govern such transport of ores produced
by small-scale miners. The absence of a permit shall be considered as prima facie evidence of illegal mining and
shall be sufficient cause for the Government to confiscate the ores or minerals being transported, the tools and
equipment utilized, and the vehicle containing the same. Ore samples not exceeding two metric tons (2 m.t.) to be
used exclusively for assay or pilot test purposes shall be exempted from such requirement.
Section 54 Mineral Trading Registration: No person shall engage in the trading of mineral products, either locally
or internationally, unless registered with the Department of Trade and Industry and accredited by the Department,
with a copy of said registration submitted to the Bureau.
Section 55 Minerals Processing Permit: No person shall engage in the processing of minerals without first securing
a minerals processing permit from the Secretary. Minerals processing permit shall be for a period of five (5) years
renewable for like periods but not to exceed a total term of twenty-five (25) years. In the case of mineral ores or
minerals produced by the small-scale miners, the processing thereof as well as the licensing of their custom mills, or
processing plants shall continue to be governed by the provisions of Republic Act No. 7076.
Section 56 Eligibility of Foreign-owned/-controlled Corporation: A foreign-owned/-controlled corporation may be
granted a mineral processing permit.
CHAPTER X
DEVELOPMENT OF MINING COMMUNITIES, SCIENCE AND MINING TECHNOLOGY
Section 57 Expenditure for Community Development and Science and Mining Technology:
A contractor shall assist in the development of its mining community, the promotion of the general welfare of its
inhabitants, and the development of science and mining technology.
Section 58 Credited Activities: Activities that may be credited as expenditures for development of mining
communities, and science and mining technology are the following:
a. Any activity or expenditure intended to enhance the development of the mining and neighboring communities of a
mining operation other than those required or provided for under existing laws, or collective bargaining agreements,
and the like; and
b. Any activity or expenditure directed towards the development of geosciences and mining technology such as, but
not limited to, institutional and manpower development, and basic and applied researches. Appropriate supervision
and control mechanisms shall be prescribed in the implementing rules and regulations of this Act.
Section 59 Training and Development: A contractor shall maintain an effective program of manpower training and
development throughout the term of the mineral agreement and shall encourage and train Filipinos to participate in
all aspects of the mining operations, including the management thereof. For highly-technical and specialized mining
operations, the contractor may, subject to the necessary government clearances, employ qualified foreigners.
Section 60 Use of Indigenous Goods, Services and Technologies: A contractor shall give preference to the use of
local goods, services and scientific and technical resources in the mining operations, where the same are of
equivalent quality, and are available on equivalent terms as their imported counterparts.
Section 61 Donations/Turn Over of Facilities: Prior to cessation of mining operations occasioned by abandonment
or withdrawal of operations, on public lands by the contractor, the latter shall have a period of one (1) year
therefrom within which to remove his improvements; otherwise, all the social infrastructure and facilities shall be
turned over or donated tax-free to the proper government authorities, national or local, to ensure that said
infrastructure and facilities are continuously maintained and utilized by the host and neighboring communities.
Section 62 Employment of Filipinos: A contractor shall give preference to Filipino citizens in all types of mining
employment within the country insofar as such citizens are qualified to perform the corresponding work with
reasonable efficiency and without hazard to the safety of the operations. The contractor, however, shall not be
hindered from hiring employees of his own selection, subject to the provisions of Commonwealth Act No. 613, as
amended, for technical and specialized work which, in his judgment and with the approval of the Director, requires
highly-specialized training or long experience in exploration, development or utilization of mineral resources:
Provided, That in no case shall each employment exceed five (5) years or the payback period as represented in
original project study, whichever is longer: Provided, further, That each foreigner employed as mine manager, vice-
president for operations or in an equivalent managerial position in charge of mining, milling, quarrying or drilling
operation shall:
a. Present evidence of his qualification and work experience; or
b. Shall pass the appropriate government licensure examination; o
c. In special cases, may be permitted to work by the Director for a period not exceeding one (1) year: Provided,
however, That if reciprocal privileges are extended to Filipino nationals in the country of domicile, the Director may
grant waivers or exemptions.
CHAPTER XI
SAFETY AND ENVIRONMENTAL PROTECTION
Section 63 Mines Safety and Environmental Protection: All contractors and permittees shall strictly comply with all
the mines safety rules and regulations as may be promulgated by the Secretary concerning the safe and sanitary
upkeep of the mining operations and achieve waste-free and efficient mine development. Personnel of the
Department involved in the implementation of mines safety, health and environmental rules and regulations shall be
covered under Republic Act No. 7305.
Section 64 Mine Labor: No person under sixteen (16) years of age shall be employed in any phase of mining
operations and no person under eighteen (18) years of age shall be employed underground in a mine.
Section 65 Mine Supervision: All mining and quarrying operations that employ more than fifty (50) workers shall
have at least one (1) licensed mining engineer with at least five (5) years of experience in mining operations, and
one (1) registered foreman.
Section 66 Mine Inspection: The regional director shall have exclusive jurisdiction over the safety inspection of all
installations, surface or underground, in mining operations at reasonable hours of the day or night and as much as
possible in a manner that will not impede or obstruct work in progress of a contractor or permittee.
Section 67 Power to Issue Orders: The mines regional director shall, in consultation with the Environmental
Management Bureau, forthwith or within such time as specified in his order, require the contractor to remedy any
practice connected with mining or quarrying operations, which is not in accordance with safety and anti-pollution
laws and regulations. In case of imminent danger to life or property, the mines regional director may summarily
suspend the mining or quarrying operations until the danger is removed, or appropriate measures are taken by the
contractor or permittee.
Section 68 Report of Accidents: In case of any incident or accident, causing or creating the danger of loss of life or
serious physical injuries, the person in charge of operations shall immediately report the same to the regional office
where the operations are situated. Failure to report the same without justifiable reason shall be a cause for the
imposition of administrative sanctions prescribed in the rules and regulations implementing this Act.
Section 69 Environmental Protection: Every contractor shall undertake an environmental protection and
enhancement program covering the period of the mineral agreement or permit. Such environmental program shall be
incorporated in the work program which the contractor or permittee shall submit as an accompanying document to
the application for a mineral agreement or permit. The work program shall include not only plans relative to mining
operations but also to rehabilitation, regeneration, revegetation and reforestation of mineralized areas, slope
stabilization of mined-out and tailings covered areas, aquaculture, watershed development and water conservation;
and socioeconomic development.
Section 70 Environmental Impact Assessment (EIA): Except during the exploration period of a mineral agreement
or financial or technical assistance agreement or an exploration permit, an environmental clearance certificate shall
be required based on an environmental impact assessment and procedures under the Philippine Environmental
Impact Assessment System including Sections 26 and 27 of the Local Government Code of 1991 which require
national government agencies to maintain ecological balance, and prior consultation with the local government
units, non-governmental and people's organizations and other concerned sectors of the community: Provided, That a
completed ecological profile of the proposed mining area shall also constitute part of the environmental impact
assessment. People's organizations and non-governmental organizations shall be allowed and encouraged to
participate in ensuring that contractors/permittees shall observe all the requirements of environmental protection.
Section 71 Rehabilitation: Contractors and permittees shall technically and biologically rehabilitate the excavated,
mined-out, tailings covered and disturbed areas to the condition of environmental safety, as may be provided in the
implementing rules and regulations of this Act. A mine rehabilitation fund shall be created, based on the contractor's
approved work program, and shall be deposited as a trust fund in a government depository bank and used for
physical and social rehabilitation of areas and communities affected by mining activities and for research on the
social, technical and preventive aspects of rehabilitation. Failure to fulfill the above obligation shall mean immediate
suspension or closure of the mining activities of the contractor/permittee concerned.
CHAPTER XII
AUXILIARY MINING RIGHTS
Section 72 Timber Rights: Any provision of law to the contrary notwithstanding, a contractor may be granted a right
to cut trees or timber within his mining area as may be necessary for his mining operations subject to forestry laws,
rules and regulations: Provided, That if the land covered by the mining area is already covered by existing timber
concessions, the volume of timber needed and the manner of cutting and removal thereof shall be determined by the
mines regional director, upon consultation with the contractor, the timber concessionaire/permittee and the Forest
Management Bureau of the Department: Provided, further, That in case of disagreement between the contractor and
the timber concessionaire, the matter shall be submitted to the Secretary whose decision shall be final. The
contractor shall perform reforestation work within his mining area in accordance with forestry laws, rules and
regulations.
Section 73 Water Rights: A contractor shall have water rights for mining operations upon approval of application
with the appropriate government agency in accordance with existing water laws, rules and regulations promulgated
thereunder: Provided, That water rights already granted or vested through long use, recognized and acknowledged
by local customs, laws, and decisions of courts shall not thereby be impaired: Provided, further, That the
Government reserves the right to regulate water rights and the reasonable and equitable distribution of water supply
so as to prevent the monopoly of the use thereof.
Section 74 Right to Possess Explosives: A contractor/exploration permittee shall have the right to possess and use
explosives within his contract/permit area as may be necessary for his mining operations upon approval of
application with the appropriate government agency in accordance with existing laws, rules and regulations
promulgated thereunder: Provided, That the Government reserves the right to regulate and control the explosive
accessories to ensure safe mining operations.
Section 75 Easement Rights: When mining areas are so situated that for purposes of more convenient mining
operations it is necessary to build, construct or install on the mining areas or lands owned, occupied or leased by
other persons, such infrastructure as roads, railroads, mills, waste dump sites, tailings ponds, warehouses, staging or
storage areas and port facilities, tramways, runways, airports, electric transmission, telephone or telegraph lines,
dams and their normal flood and catchment areas, sites for water wells, ditches, canals, new river beds, pipelines,
flumes, cuts, shafts, tunnels, or mills, the contractor, upon payment of just compensation, shall be entitled to enter
and occupy said mining areas or lands.
Section 76 Entry into Private Lands and Concession Areas: Subject to prior notification, holders of mining rights
shall not be prevented from entry into private lands and concession areas by surface owners, occupants, or
concessionaires when conducting mining operations therein: Provided, That any damage done to the property of the
surface owner, occupant, or concessionaire as a consequence of such operations shall be properly compensated as
may be provided for in the implementing rules and regulations: Provided, further, That to guarantee such
compensation, the person authorized to conduct mining operation shall, prior thereto, post a bond with the regional
director based on the type of properties, the prevailing prices in and around the area where the mining operations are
to be conducted, with surety or sureties satisfactory to the regional director.
CHAPTER XIII
SETTLEMENT OF CONFLICTS
Section 77 Panel of Arbitrators: There shall be a panel of arbitrators in the regional office of the Department
composed of three (3) members, two (2) of whom must be members of the Philippine Bar in good standing and one
a licensed mining engineer or a professional in a related field, and duly designated by the Secretary as recommended
by the Mines and Geosciences Bureau Director. Those designated as members of the panel shall serve as such in
addition to their work in the Department without receiving any additional compensation As much as practicable,
said members shall come from the different bureaus of the Department in the region. The presiding officer thereof
shall be selected by the drawing of lots. His tenure as presiding officer shall be on a yearly basis. The members of
the panel shall perform their duties and obligations in hearing and deciding cases until their designation is
withdrawn or revoked by the Secretary. Within thirty (30) working days, after the submission of the case by the
parties for decision, the panel shall have exclusive and original jurisdiction to hear and decide on the following:
a. Disputes involving rights to mining areas;
b. Disputes involving mineral agreements or permits;
c. Disputes involving surface owners, occupants and claimholders/concessionaires; and
d. Disputes pending before the Bureau and the Department at the date of the effectivity of this Act.
Section 78 Appellate Jurisdiction: The decision or order of the panel of arbitrators may be appealed by the party not
satisfied thereto to the Mines Adjudication Board within fifteen (15) days from receipt thereof which must decide
the case within thirty (30) days from submission thereof for decision.
Section 79 Mines Adjudication Board: The Mines Adjudication Board shall be composed of three (3) members. The
Secretary shall be the chairman with the Director of the Mines and Geosciences Bureau and the Undersecretary for
Operations of the Department as members thereof. The Board shall have the following powers and functions:
a. To promulgate rules and regulations governing the hearing and disposition of cases before it, as well as those
pertaining to its internal functions, and such rules and regulations as may be necessary to carry out its functions;
b. To administer oaths, summon the parties to a controversy, issue subpoenas requiring the attendance and testimony
of witnesses or the production of such books, papers, contracts, records, statement of accounts, agreements, and
other documents as may be material to a just determination of the matter under investigation, and to testify in any
investigation or hearing conducted in pursuance of this Act;
c. To conduct hearings on all matters within its jurisdiction, proceed to hear and determine the disputes in the
absence of any party thereto who has been summoned or served with notice to appear, conduct its proceedings or
any part thereof in public or in private, adjourn its hearings at any time and place, refer technical matters or accounts
to an expert and to accept his report as evidence after hearing of the parties upon due notice, direct parties to be
joined in or excluded from the proceedings, correct, amend, or waive any error, defect or irregularity, whether in
substance or in form, give all such directions as it may deem necessary or expedient in the determination of the
dispute before it, and dismiss the mining dispute as part thereof, where it is trivial or where further proceedings by
the Board are not necessary or desirable:
1. To hold any person in contempt, directly or indirectly, and impose appropriate penalties therefor; and
2. To enjoin any or all acts involving or arising from any case pending before it which, if not restrained forthwith,
may cause grave or irreparable damage to any of the parties to the case or seriously affect social and economic
stability.
In any proceeding before the Board, the rules of evidence prevailing in courts of law or equity shall not be
controlling and it is the spirit and intention of this Act that shall govern. The Board shall use every and all
reasonable means to ascertain the facts in each case speedily and objectively and without regard to technicalities of
law or procedure, all in the interest of due process. In any proceeding before the Board, the parties may be
represented by legal counsel. The findings of fact of the Board shall be conclusive and binding on the parties and its
decision or order shall be final and executory.
A petition for review by certiorari and question of law may be filed by the aggrieved party with the Supreme Court
within thirty (30) days from receipt of the order or decision of the Board.
CHAPTER XIV
GOVERNMENT SHARE
Section 80 Government Share in Mineral Production Sharing Agreement: The total government share in a mineral
production sharing agreement shall be the excise tax on mineral products as provided in Republic Act No. 7729,
amending Section 151(a) of the National Internal Revenue Code, as amended.
Section 81 Government Share in Other Mineral Agreements: The share of the Government in co-production and
joint-venture agreements shall be negotiated by the Government and the contractor taking into consideration the:
a. capital investment of the project;
b. risks involved;
c. contribution of the project to the economy; and
d. other factors that will provide for a fair and equitable sharing between the Government and the contractor.
The Government shall also be entitled to compensations for its other contributions which shall be agreed upon by
the parties, and shall consist, among other things, the contractor's income tax, excise tax, special allowance,
withholding tax due from the contractor's foreign stockholders arising from dividend or interest payments to the said
foreign stockholders, in case of a foreign national, and all such other taxes, duties and fees as provided for under
existing laws.
The Government share in financial or technical assistance agreement shall consist of, among other things, the
contractor's corporate income tax, excise tax, special allowance, withholding tax due from the contractor's foreign
stockholders arising from dividend or interest payments to the said foreign stockholder in case of a foreign national
and all such other taxes, duties and fees as provided for under existing laws
The collection of Government share in financial or technical assistance agreement shall commence after the
financial or technical assistance agreement contractor has fully recovered its pre-operating expenses, exploration,
and development expenditures, inclusive.
Section 82 Allocation of Government Share: The Government share as referred to in the preceding sections shall be
shared and allocated in accordance with Sections 290 and 292 of Republic Act No. 7160 otherwise known as the
Local Government Code of 1991. In case the development and utilization of mineral resources is undertaken by a
government-owned or -controlled corporation, the sharing and allocation shall be in accordance with Sections 291
and 292 of the said Code.
CHAPTER XV
TAXES AND FEES
Section 83 Income Taxes: After the lapse of the income tax holiday as provided for in the Omnibus Investments
Code, the contractor shall be liable to pay income tax as provided in the National Internal Revenue Code, as
amended.
Section 84 Excise Tax on Mineral Products: The contractor shall be liable to pay the excise tax on mineral products
as provided for under Section 151 of the National Internal Revenue Code: Provided, however, That with respect to a
mineral production sharing agreement, the excise tax on mineral products shall be the government share under said
agreement.
Section 85 Mine Wastes and Tailings Fees: A semi-annual fee to be known as mine wastes and tailings fee is hereby
imposed on all operating mining companies in accordance with the implementing rules and regulations. The mine
wastes and tailings fee shall accrue to a reserve fund to be used exclusively for payment for damages to:
a. Lives and personal safety;
b. Lands, agricultural crops and forest products, marine life and aquatic resources, cultural resources; and
c. Infrastructure and the revegetation and rehabilitation of silted farm lands and other areas devoted to agriculture
and fishing caused by mining pollution.
This is in addition to the suspension or closure of the activities of the contractor at any time and the penal sanctions
imposed upon the same.
The Secretary is authorized to increase mine wastes and tailings fees, when public interest so requires, upon the
recommendation of the Director.
Section 86 Occupation Fees:
There shall be collected from any holder of a mineral agreement, financial or technical assistance agreement or
exploration permit on public or private lands, an annual occupation fee in accordance with the following schedule:
a. For exploration permit - Five pesos (P5.00) per hectare or fraction thereof per annum;
b. For mineral agreements and financial or technical assistance agreements - Fifty pesos (P50.00) per hectare or
fraction thereof per annum; and
c. For mineral reservation - One hundred pesos (P100.00) per hectare or fraction thereof per annum.
The Secretary is authorized to increase the occupation fees provided herein when the public interest so requires,
upon recommendation of the Bureau Director.
Section 87 Manner of Payment of Fees: The fees shall be paid on the date the mining agreement is registered with
the appropriate office and on the same date every year thereafter. It shall be paid to the treasurer of the municipality
or city where the onshore mining areas are located, or to the Director in case of offshore mining areas. For this
purpose, the appropriate officer shall submit to the treasurer of the municipality or city where the onshore mining
area is located, a complete list of all onshore mining rights registered with his office, indicating therein the names of
the holders, area in hectares, location, and date registered. If the fee is not paid on the date specified, it shall be
increased by twenty-five per centum (25%).
Section 88 Allocation of Occupation Fees: Thirty per centum (30%) of all occupational fees collected from holders
of mining rights in onshore mining areas shall accrue to the province and seventy per centum (70%) to the
municipality in which the onshore mining areas are located. In a chartered city, the full amount shall accrue to the
city concerned.
Section 89 Filing Fees and Other Charges: The Secretary is authorized to charge reasonable filing fees and other
charges as he may prescribe in accordance with the implementing rules and regulations.
CHAPTER XVI
INCENTIVES
Section 90 Incentives: The contractors in mineral agreements, and financial or technical assistance agreements shall
be entitled to the applicable fiscal and non-fiscal incentives as provided for under Executive Order No. 226,
otherwise known as the Omnibus Investments Code of 1987. Provided, That holders of exploration permits may
register with the Board of Investments and be entitled to the fiscal incentives granted under the said Code for the
duration of the permits or extensions thereof: Provided, further, That mining activities shall always be included in
the investment priorities plan.
Section 91 Incentives for Pollution Control Devices: Pollution control devices acquired, constructed or installed by
contractors shall not be considered as improvements on the land or building where they are placed, and shall not be
subject to real property and other taxes or assessments: Provided, however, That payment of mine wastes and
tailings fees is not exempted.
Section 92 Income Tax-Carry Forward of Losses: A net operating loss without the benefit of incentives incurred in
any of the first ten (10) years of operations may be carried over as a deduction from taxable income for the next five
(5) years immediately following the year of such loss. The entire amount of the loss shall be carried over to the first
of the five (5) taxable years following the loss, and any portion of such loss which exceeds the taxable income of
such first year shall be deducted in like manner from the taxable income of the next remaining four (4) years.
Section 93
Income Tax-Accelerated Depreciation:
Fixed assets may be depreciated as follows:
a. To the extent of not more than twice as fast as the normal rate of depreciation or depreciated at normal rate of
depreciation if the expected life is ten (10) years or less; or
b. Depreciated over any number of years between five (5) years and the expected life if the latter is more than ten
(10) years, and the depreciation thereon allowed as deduction from taxable income: Provided, That the contractor
notifies the Bureau of Internal Revenue at the beginning of the depreciation period which depreciation rate allowed
by this section will be used.
In computing for taxable income, unless otherwise provided in this Act, the contractor may, at his option, deduct
exploration and development expenditures accumulated at cost as of the date of the prospecting or exploration and
development expenditures paid or incurred during the taxable year: Provided, That the total amount deductible for
exploration and development expenditures shall not exceed twenty-five per centum (25%) of the net income from
mining operations. The actual exploration and development expenditures minus the twenty-five per centum (25%)
net income from mining shall be carried forward to the succeeding years until fully deducted.
Net income from mining operation is defined as gross income from operations less allowable deductions which are
necessary or related to mining operations. Allowable deductions shall include mining, milling and marketing
expenses, depreciation of properties directly used in the mining operations. This paragraph shall not apply to
expenditures for the acquisition or improvement of property of a character which is subject to the allowances for
depreciation.
Section 94 Investment Guarantees: The contractor shall be entitled to the basic rights and guarantees provided in the
Constitution and such other rights recognized by the government as enumerated hereunder:
a. Repatriation of investments. The right to repatriate the entire proceeds of the liquidation of the foreign investment
in the currency in which the investment was originally made and at the exchange rate prevailing at the time of
repatriation.
b. Remittance of earnings. The right to remit earnings from the investment in the currency in which the foreign
investment was originally made and at the exchange rate prevailing at the time of remittance.
c. Foreign loans and contracts. The right to remit at the exchange rate prevailing at the time of remittance such sums
as may be necessary to meet the payments of interest and principal on foreign loans and foreign obligations arising
from financial or technical assistance contracts
d. Freedom from expropriation. The right to be free from expropriation by the Government of the property
represented by investments or loans, or of the property of the enterprise except for public use or in the interest of
national welfare or defense and upon payment of just compensation. In such cases, foreign investors or enterprises
shall have the right to remit sums received as compensation for the expropriated property in the currency in which
the investment was originally made and at the exchange rate prevailing at the time of remittance.
e. Requisition of investment. The right to be free from requisition of the property represented by the investment or of
the property of the enterprises except in case of war or national emergency and only for the duration thereof. Just
compensation shall be determined and paid either at the time or immediately after cessation of the state of war or
national emergency. Payments received as compensation for the requisitioned property may be remitted in the
currency in which the investments were originally made and at the exchange rate prevailing at the time of
remittance.
f. Confidentiality. Any confidential information supplied by the contractor pursuant to this Act and its implementing
rules and regulations shall be treated as such by the Department and the Government, and during the term of the
project to which it relates.
CHAPTER XVII
GROUND FOR CANCELLATION, REVOCATION, AND TERMINATION
Section 95 Late or Non-filing of Requirements: Failure of the permittee or contractor to comply with any of the
requirements provided in this Act or in its implementing rules and regulations, without a valid reason, shall be
sufficient ground for the suspension of any permit or agreement provided under this Act.
Section 96 Violation of the Terms and Conditions of Permits or Agreements: Violation of the terms and conditions
of the permits or agreements shall be a sufficient ground for cancellation of the same.
Section 97 Non-Payment of Taxes and Fees: Failure to pay the taxes and fees due the Government for two (2)
consecutive years shall cause the cancellation of the exploration permit, mineral agreement, financial or technical
assistance agreement and other agreements and the re-opening of the area subject thereof to new applicants.
Section 98 Suspension or Cancellation of Tar Incentives and Credits: Failure to abide by the terms and conditions of
tax incentive and credits shall cause the suspension or cancellation of said incentives and credits.
Section 99 Falsehood or Omission of Facts in the Statement: All statements made in the exploration permit, mining
agreement and financial or technical assistance agreement shall be considered as conditions and essential parts
thereof and any falsehood in said statements or omission of facts therein which may alter, change or affect
substantially the facts set forth in said statements may cause the revocation and termination of the exploration
permit, mining agreement and financial or technical assistance agreement.
CHAPTER XVIII
ORGANIZATIONAL AND INSTITUTIONAL ARRANGEMENTS
Section 100 From Staff Bureau to Line Bureau: The Mines and Geosciences Bureau is hereby transformed into a
line bureau consistent with Section 9 of this Act: Provided, That under the Mines and Geosciences Bureau shall be
the necessary mines regional, district and other pertinent offices - the number and specific functions of which shall
be provided in the implementing rules and regulations of this Act.
CHAPTER XIX
PENAL PROVISIONS
Section 101 False Statements: Any person who knowingly presents any false application, declaration, or evidence to
the Government or publishes or causes to be published any prospectus or other information containing any false
statement relating to mines, mining operations or mineral agreements, financial or technical assistance agreements
and permits shall, upon conviction, be penalized by a fine of not exceeding Ten thousand pesos (P10,000.00).
Section 102 Illegal Exploration: Any person undertaking exploration work without the necessary exploration permit
shall, upon conviction, be penalized by a fine of not exceeding Fifty thousand pesos (P50,000.00).
Section 103 Theft of Minerals: Any person extracting minerals and disposing the same without a mining agreement,
lease, permit, license, or steals minerals or ores or the products thereof from mines or mills or processing plants
shall, upon conviction, be imprisoned from six (6) months to six (6) years or pay a fine from Ten thousand pesos
(P10,000.00) to Twenty thousand pesos (P20,000.00) or both, at the discretion of the appropriate court. In addition,
he shall be liable to pay damages and compensation for the minerals removed, extracted, and disposed of. In the case
of associations, partnerships, or corporations, the president and each of the directors thereof shall be responsible for
the acts committed by such association, corporation, or partnership.
Section 104 Destruction of Mining Structures: Any person who willfully destroys or damages structures in or on the
mining area or on the mill sites shall, upon conviction, be imprisoned for a period not to exceed five (5) years and
shall, in addition, pay compensation for the damages which may have been caused thereby.
Section 105 Mines Arson: Any person who willfully sets fire to any mineral stockpile, mine or workings, fittings or
a mine, shall be guilty of arson and shall be punished, upon conviction, by the appropriate court in accordance with
the provisions of the Revised Penal Code and shall, in addition, pay compensation for the damages caused hereby.
Section 106 Willful Damage to a Mine: Any person who willfully damages a mine, unlawfully causes water to run
into a mine, or obstructs any shaft or passage to a mine, or renders useless, damages or destroys any machine,
appliance, apparatus, rope, chain, tackle, or any other things used in a mine, shall be punished, upon conviction, by
the appropriate court, by imprisonment not exceeding a period of five (5) years and shall, in addition, pay
compensation for the damages caused thereby.
Section 107 Illegal Obstruction to Permittees or Contractors: Any person who, without justifiable cause, prevents or
obstructs the holder of any permit, agreement or lease from undertaking his mining operations shall be punished,
upon conviction by the appropriate court, by a fine not exceeding Five thousand pesos (P5,000.00) or imprisonment
not exceeding one (1) year, or both, at the discretion of the court.
Section 108 Violation of the Terms and Conditions of the Environmental Compliance Certificate: Any person who
willfully violates or grossly neglects to abide by the terms and conditions of the environmental compliance
certificate issued to said person and which causes environmental damage through pollution shall suffer the penalty
of imprisonment of six (6) months to six (6) years or a fine of Fifty thousand pesos (P50,000.00) to Two hundred
thousand pesos (P200,000.00), or both, at the discretion of the court.
Section 109 Illegal Obstruction to Government Officials: Any person who illegally prevents or obstructs the
Secretary, the Director or any of their representatives in the performance of their duties under the provisions of this
Act and of the regulations promulgated hereunder shall be punished upon conviction, by the appropriate court, by a
fine not exceeding Five thousand pesos (P5,000.00) or by imprisonment not exceeding one (1) year, or both, at the
discretion of the court.
Section 110 Other Violations: Any other violation of this Act and its implementing rules and regulations shall
constitute an offense punishable with a fine not exceeding Five thousand pesos (P5,000.00).
Section 111 Fines: The Secretary is authorized to charge fines for late or non-submission of reports in accordance
with the implementing rules and regulations of this Act.
CHAPTER XX
TRANSITORY AND MISCELLANEOUS PROVISIONS
Section 112 Non-Impairment of Existing Mining/Quarrying Rights: All valid and existing mining lease contracts,
permits/licenses, leases pending renewal, mineral production-sharing agreements granted under Executive Order No.
279, at the date of effectivity of this Act, shall remain valid, shall not be impaired, and shall be recognized by the
Government: Provided, That the provisions of Chapter XIV on government share in mineral production-sharing
agreement and of Chapter XVI on incentives of this Act shall immediately govern and apply to a mining lessee or
contractor unless the mining lessee or contractor indicates his intention to the secretary, in writing, not to avail of
said provisions: Provided, further, That no renewal of mining lease contracts shall be made after the expiration of its
term: Provided, finally, That such leases, production-sharing agreements, financial or technical assistance
agreements shall comply with the applicable provisions of this Act and its implementing rules and regulations.
Section 113 Recognition of Valid and Existing Mining Claims and Lease/Quarry Applications: Holders of valid and
existing mining claims, lease/quarry applications shall be given preferential rights to enter into any mode of mineral
agreement with the government within two (2) years from the promulgation of the rules and regulations
implementing this Act.
Section 114 Separability Clause: If any of the provision of this Act is held or declared to be unconstitutional or
invalid by a competent court, the other provisions hereof shall continue to be in force as if the provision so annulled
or voided had never been incorporated in this Act.
Section 115 Repealing and Amending Clause: All laws, executive orders, presidential decrees, rules and regulations
or parts thereof which are inconsistent with any of the provisions of this Act are hereby repealed or amended
accordingly.
Section 116 Effectivity Clause: This Act shall take effect thirty (30) days following its complete publication in two
(2) newspapers of general circulation in the Philippines.
Approved: MARCH 03 1995
TITLE I
PRODUCTION AND MARKETING SUPPORT SERVICES
Chapter 1
Strategic Agricultural and Fisheries Development Zones
Section 5. Declaration of Policy. - It is the policy of the State to ensure that all sectors of the economy and all
regions of the country shall be given optimum opportunity to develop through the rational and sustainable use of
resources peculiar to each area in order to maximize agricultural productivity, promote efficiency and equity and
accelerate the modernization of the agriculture and fisheries sectors of the country.
Section 6. Network of Areas for Agricultural and Agro-Industrial Development. - The Department shall, within six
(6) months after the approval of this Act, and in consultation wit the local government units , appropriate
government agencies, concerned non-government organizations (NGOs)and organized farmers' and fisherfolk's
groups, identify the strategic Agriculture and Fisheries Development Zones (SAFDZ) within the network of
protected areas for agricultural and agro-industrial development to ensure that lands are efficiently and sustainably
utilized for food and non-food production and agro-industrialization.
The SAFDZ which shall serve as centers where development in the agriculture and fisheries sectors are catalyzed in
an environmentally and socio-cultural sound manner, shall be identified on the basis of the following criteria
a. Agro-climatic and environmental conditions giving the area as competitive advantage in the cultivation, culture,
production and processing of particular crops, animals and aquatic products;
b. Strategic location of the area for the establishment of agriculture or fisheries infrastructure, industrial
complexness, production and processing zones;
c. Strategic location and of the area for market development and market networking both at the local and
international levels; and
d. Dominant presence of agrarian reform communities (ARCs) and/or small owner-cultivators and amortizing
owners/agrarian reform beneficiaries and other small farmers and fisher folk in the area.
The SAFDZ shall have an integrated development plan consisting of production, processing, investment, marketing,
human resources and environmental protection components.
Section 7. Modern Farms. - The Department in coordination with the local government units (LGUs) and
appropriate government agencies, may designate agrarian reform communities (ARCs) and other areas within the
SAFDZ suitable for economic scale production which will serve as model farms.
Farmer-landowners whose lands are located within these designated areas shall be given the option to enter into a
management agreement with corporate entities with proven competence in farm operations and management, high-
end quality production and productivity through the use of up-to-date technology and collateral resources such as
skilled manpower, adequate capital and credit, and access to markets, consistent with the existing laws.
Section 8. Mapping. - The Department, through the Bureau of Soils and Water Management (BSWM), in
coordination with the National Mapping and Resource Information Authority (NAMRIA) and the Housing and Land
Use Regulatory Board (HLURB) shall undertake the mapping of network of areas for agricultural and agro-
industrial development for all municipalities, cities and an appropriate scale. The BSWM may call on other agencies
to provide technical and other logistical support in this undertaking .
Section 9. Delineation of Strategic Agriculture and Fisheries Development Zones. - The Department, in consultation
with the Department of Agrarian Reform, the Department of Trade and Industry, the Department of Environment
and Natural Resources, Department of Science and Technology, the concerned LGU's, the organized farmers and
fisher folk groups, the private sector and communities shall, without prejudice to the development of identified
economic zones and free ports, establish and delineate based on sound resource accounting, the SAFDZ within one
(1) year from the effectivity of this Act.
All irrigated lands, irrigable lands already covered by irrigation a projects with firm funding commitments, and
lands with existing or having the potential for growing high-value crops so delineated and included within the
SAFDZ shall not be converted for a period of five (5) years front the effectivity for this Act: Provided, however,
That not more than five percent (5%) of the said lands located within the SAFDZ may be converted upon
compliance with existing laws, rules, regulations, executive order and issuances, and administrative orders relating
to land use conversion: Provided, further, That thereafter 1) a review of the SAFDZ, specifically of the productivity
of the areas, improvement of the quality of life of farmers and fisher folk, and efficiency and defectiveness of the
support services shall be conducted by the Department and the Department of Agrarian Reform, in coordination with
the Congressional Oversight Committee on Agricultural Committee and Fisheries Modernization; 2) conversion
may be allowed, if at all, on a case-to-case basis subject to existing laws, rules, regulations, executive orders and
issuances, and administrative orders governing land use conversion; 3) in case of conversion, the land owners will
pay the Department the amount equivalent to the government's investment cost including inflation.
Section 10. Preparation of Land Use and Zoning Ordinance. - Within one (1) year from the finalization of the
SAFDZ, in every city and municipality, all cities and municipalities shall have prepared their respective land use and
zoning ordinance incorporating the SAFDZ, where applicable. Thereafter, all land use plans and zoning ordinances
shall be updated every four (4) years or as often as may be deemed necessary upon the recommendation of the
Housing and Land Use Regulatory Board and must be completed within the first year of the term of office of the
mayor. If the cities/municipalities fail to comply with the preparation of zoning and land use plans, the DILG shall
impose the penalty as provided for under Republic Act No.7160
Section 11. Penalty for Agricultural Inactivity and Premature Conversion. - Any person or juridical entity who
knowingly or deliberately causes any irrigated agricultural lands seven (7) hectares or larger, whether contiguous for
not, within the protected areas for agricultural development, as specified under Section 6 in relation to Section 9 of
this Act, to lie idle and unproductive for a period exceeding one (1) year, unless due to force majeure, shall be
subject to an idle land tax of Three Thousand Pesos (P3,000.00) per hectare per year. In addition, the violator, shall
be required to put back such lands to productive agricultural use. Should the continued agricultural inactivity, unless
due to force majeure, exceed a period of two (2) years, the land shall be subject to escheat proceedings.
Any person found guilty of premature or illegal conversion shall be penalized with imprisonment of two (2) to six
(6) years, or a fine equivalent to one hundred percent (100%) of the government's investment cost, or both, at the
discretion of the court, and an accessory penalty of forfeiture of the land and any improvement thereon.
In addition, the DAR may impose the following penalties, after determining, in an administrative proceedings, that
violation of this law has been committed:
a. Consolation or withdrawal of the authorization for land use conversion; and
b. Backlisting, or automatic disapproval of pending and subsequent conversion applications that they may file with
the DAR.
Section 12. Protection of Watershed Areas. - All watersheds that are sources of water for existing and potential
irrigable areas and recharge areas of major aquifers identified by the Department of Agriculture and the Department
of Environment and Natural resources shall be preserves as such at all times.
Chapter 2
Agriculture and Fisheries Modernization Plan
Section 13. Agriculture and Fisheries Modernization Plan (AFMP). - The Department, in consultation with the
farmers and fisher folk, the private sector, NGOs, people's organizations and the appropriate government agencies
and offices, shall formulate and implement a medium- and long-term comprehensive Agriculture and Fisheries
Modernization Plan.
The Agriculture and Fisheries Modernization Plan shall focus on five (5) major concerns:
a. Food security;
b. Poverty alleviation and social equity;
c. Income enhancement and profitability, especially for farmers and fisher folk;
d. Global competitiveness; and
e. Sustainability.
Section 14. Food Security , Poverty Alleviation, Social Equity and Income Enhancement. - The Department, in
coordination with other concerned departments or agencies, shall formulate medium-and long-term plans addressing
food security, poverty alleviation, social equity and income enhancement concerns based on, but not limited to, the
following goals and indicators for development:
a. Increased income and profit of small farmers and fisherfolk;
b. Availability of rice and other staple foods at affordable process;
c. Reduction of rural poverty and income inequality;
d. Reduction of the incidence of malnutrition;
e. Reduction of rural unemployment and underemployment; and
f. Improvement in land tenure of small farmers.
Section 15. Global Competitiveness and Sustainability. - The Department shall formulate medium-and-long-term
plans aimed at enhancing the global competitiveness and sustainability of the country in agriculture and fisheries
based on, but not limited to, the following goals and indicators for development:
a. Increase in the volume, quality and value of agriculture and fisheries production for domestic consumption and for
exports;
b. Reduction in post-harvest losses;
c. Increase in the number/types and quality of processed agricultural and fishery products;
d. Increase in the number of international trading partners in agriculture and fishery products;
e. Increase in the number of sustainable agriculture and fisheries firms engaged in domestic production, processing,
marketing and export activities;
f. Increase in and wider level of entrepreneurship among farmers and fisher folk in the area;
g. Increase in the number of farms engaged in diversified farming; and
h. Reduced use of agro-chemicals that are harmful to health and the environment.
Section 16. Global Climate Change. - The Department, in coordination with the Philippine Atmospheric,
Geophysical and Astronomical Service Administration (P. A. G. A. S. A.) and such other appropriate government
agencies, shall devise a method of regularly monitoring and considering the effect of global climate changes,
weather disturbances, and annual productivity cycles for the purpose of forecasting and formulating agriculture and
fisheries production programs.
Section 17. Special Concerns. - The Department shall consider the following areas of concerns, among other in
formulating the AFMP:
a. Strategies and programs aimed to achieve growth and profitability targets in the context of the constraints and
challenges of the World Trade Organization (WTO);
b. Programs arising from the implementation of the Agrarian Reform Program;
c. Identification of SAFDZ;
d. Infrastructure and market support for the SAFDZ;
e. Infrastructure support to make agriculture and fisheries production inputs, information and technology readily
available to farmers, fisherfolk, cooperatives and entrepreneurs;
f. Credit programs for small farmers and fisher folk, and agricultural graduates;
g. Comprehensive and integrated agriculture and fisheries research, development and extension services;
h. Preservation of biodiversity, genetic materials and the environment;
i. Adequate and timely response against environmental threats to agriculture and fisheries;
j. Rural non-farm employment;
k. Access to aquatic resources by fisher folk;
l. Basic needs program for the impoverished sectors of society who will be affected by liberalization;
m. Indigenous peoples;
n. Rural youth;
o. Women;
p. Handicapped persons; and
q. Senior citizens.
Section 18. Monitoring and Evaluation. - The Department shall develop the capability of monitoring the AFMP
through a Program Benefit Monitoring and Evaluation System (PBMES). In addition, it can secure the services of
independent consultants and external evaluators in order to assess its over-all impact. The Department shall make
periodic reports to the Congressional Oversight Committee on Agriculture and Fisheries Modernization.
Section 19. Role of Other Agencies. - All units and agencies of the government shall support the Department in the
implementation of the AFMP.
In particular, the Department of Public Works and Highways shall coordinate with the Department with respect to
the infrastructure support aspect of the plan order to accomplish networking of related infrastructure facilities.
The Department of Interior and Local Government shall provide assistance to the Department in mobilizing
resources under the control of local government units.
The Department of Trade and Industry, Agrarian Reform, Science and Technology, and Environment and Natural
Resources shall coordinate their investment programs and activities to complement the Department's implementation
of the AFMP.
The Department of Education, Culture and Sports, the Technical Educational and Skills Development Authority, the
Department of Health with the Department of Social Services and Development shall coordinate with the
Department to determine the financial requirements of small farmers and fisherfolk to adjust to the effects of
modernization as envisioned in the Agriculture and Fisheries Modernization Plan.
The departments referred above shall be required to identify in their budget proposals the allocation intended for the
improvement of the environmental and other conditions affecting agriculture and fisheries.
Congressional initiatives shall also be coordinated by the Committees on Agriculture on both Houses to complement
and enhance the programs and activities of the Department in the implementation of the AFMP.
Chapter 3
Credit
Section 20. Declaration of Policy. - It is hereby declared the policy of the State to alleviate poverty and promote
vigorous growth in the countryside through access to credit by small farmers, fisher folk, particularly the women
involved in the production, processing and trading of agriculture and fisheries products and the small and medium
scale enterprises (SMEs) and industries engaged in agriculture and fisheries.
Interest rates shall be determined by market forces, provided that existing credit arrangements with agrarian reform
beneficiaries are not affected. Emphasis of the program shall be on proper management and utilization.
In this regard, the State enjoins the active participation of the banking sector and government financial institutions in
the rural financial system.
Section 21. Phase-out of the Directed Credit Programs (DCPs) and Provision for the Agro-Industry Modernization
Credit and Financing Program (AMCPP). - The Department shall implement existing DCPs; however, the
Department shall, within a period of four (4) years from the effectivity of this Act, phase-out all DCPs and deposit
all its loanable funds including those under the Comprehensive Agricultural Loan Fund (CALF) including new
funds provided by this Act for the AMCFP and transfer the management thereof to cooperative banks , rural banks,
government financial institutions and viable NGOs for the Agro-Industry Modernization Credit Financing Program
(AMCFP). Interest earnings of the said deposited loan funds shall be reverted to the AMCFP.
Section 22. Coverage. - An agriculture, fisheries and agrarian reform credit and financing system shall be designed
for the use and benefit of farmers, fisher folk those engaged in food and non-food production, processing and
trading, cooperatives, farmers'/fisherfolk's organization, and SMEs engaged in agriculture hereinafter referred to in
this chapter as the "beneficiaries"
Section 23. Scope of the Agro-Industry Modernization Credit and Financing Program (AMCFP).. - The Agro-
Industry Modernization Credit and Financing Program shall include the packaging and delivery of various credit
assistance programs for the following:
a. Agriculture and fisheries production including possessing of fisheries and agri-based products and farm inputs;
b. Acquisition of work animals, farm and fishery equipment and machinery;
c. Acquisition of seeds, fertilizer, poultry, livestock, feeds and other similar items;
d. Procurement of agriculture and fisheries products for storage, trading , processing and distribution;
e. Acquisition of water pumps and installation of tube wells for irrigation;
f. Construction , acquisition and repair of facilities for production, processing , storage, transportation,
communication, marketing and such other facilities in support of agriculture and fisheries;
g. Working capital for agriculture and fisheries graduates to enable them to engage in agriculture and fisheries
related economic activities;
h. Agribusiness activities which support soil and water conservation and ecology-enhancing activities;
i. Privately-funded and LGU-funded irrigation systems that are designed to protect the watershed;
j. Working capital for long-gestating projects; and
k. Credit guarantees on uncollaterized loans to farmers and fisherfolks.
Section 24. Review of the mandates of Land Bank of the Philippines Crop Insurance Corporation, Guarantee Fund
For Small and Medium Enterprises, Quedan and Rural Credit Guarantee Corporation, Agricultural Credit Policy
Council. - The Department of Finance shall commission and independent review of the charters and the respective
programs of the Land Bank of the Philippines (LBP), Philippine Crop Insurance Corporation (PCIC), Guarantee
Fund for Small and Medium Enterprises (GFSME), Quedan and Rural Credit Guarantee Corporation (Quendancor),
and Agricultural Credit Policy Council (ACPC), and recommend policy changes and other measures to induce the
private sectors participation in lending to agriculture and to improve credit access by farmers and fisherfolk:
Provided, That agriculture and fisheries projects with long gestation period shall be entitled to a longer grace period
in repaying the loan based on the economic life of the project.
The Land Bank of the Philippines, shall, in accordance with its original mandate, focus primarily on plans and
programs in relation to the financing of agrarian reform and the delivery of credit services to the agriculture and
fisheries sectors, especially to small farmers and fisherfolk.
The review shall start six (6) months after the enactment of this Act. Thereafter, the review shall make
recommendations to the appropriate Congressional Committees for possible legislative actions and to the Executive
Branch for policy and program changes within six (6) months after submission.
Section 25. Rationalization of Credit Guarantee Schemes and Funds. - All existing credit guarantee schemes and
funds applicable to the agriculture and fishery sectors shall be rationalized and consolidated into an Agriculture and
Fisheries Credit Guarantee Fund. The rationalization shall cover the credit guarantee schemes and funds operated by
the Quendancor, the GFSME and the Comprehensive Agricultural Loan Fund. The Agriculture and Fisheries Credit
Guarantee Fund shall be managed and implemented by the Quendancor Provided, That representation to the
Quendancor Board shall be granted to cooperatives, local government units and rural financial institutions;
Provided, further, That credit guarantee shall be given only to small-scale agriculture and fisheries activities and to
countryside micro-small, and medium enterprises. It may also cover loan guarantees for purchase orders and sales
contracts.
The Agriculture and Fisheries Credit Guarantee Fund shall be funded by at least ten percent (10%) of the funding
allocation for the AMCFP.
Chapter 4
Irrigation
Section 26. Declaration of Policy. - It is the policy of the State to use its natural resources rationally and equitably.
The state shall prevent the further destruction of watersheds, rehabilitate existing irrigation systems and promote the
development of irrigation systems that are effective, affordable, appropriate, and efficient.
In the choice of location-specific irrigation projects, the economic principle of comparative advantage shall always
be adhered to.
Section 27. Research and Development. - Irrigation Research and Development (R&D) shall be pursued and priority
shall be given to the development of effective, appropriate , and efficient irrigation and water management
technologies.
The Department shall coordinate with the Department of Environment and Natural Resources concerning the
preservation and rehabilitation of watersheds to support the irrigation systems.
Section 28. Criteria for Selection of Irrigation Development Scheme. - The Selection of appropriate scheme of
irrigation development shall be location-specific and based on the following criteria
a. Technical feasibility;
b. Cost-effectiveness;
c. Affordability, low investment cost per unit area;
d. Sustainability and simplicity of operation;
e. Recovery of operation and maintenance cost;
f. Efficiency in water use;
g. Length of gestation period; and
h. Potential for increasing unit area productivity.
All irrigation projects shall, in addition to the criteria enumerated above, be subjected to a social cost-benefit
analysis.
Section 29. Simplified Public Bidding. - The construction, repair, rehabilitation, improvement, or maintenance of
irrigation projects and facilities shall follow the Commission on Audit (COA) rules on simplified public bidding.
Irrigation projects undertaken by farmers, farmer's organizations and other private entities whose funding is partly or
wholly acquired by way of loan from government financial institutions shall not be subject to the bidding
requirements of the government.
Section 30. National Irrigation Systems (NIS). - The National Irrigation Administration (NIA) shall continue to
plan, design, develop, rehabilitate, and improve the NISs. It shall continue to maintain and operate the major
irrigation structures including the head works and main canals.
In addition, the NIA is mandated to gradually turn over operation and maintenance of the National Irrigation
System's secondary canals and on-farm facilities to Irrigators' Associations
Section 31. Communal Irrigation Systems (CIS). - The Department shall, within five (5) years from the effectivity
of this Act, devolve the planning, design and management of CISs, including the transfer of NIA's assets and
resources in relation to the CIS, to the LGUs. The budget for the development, construction, operation and
maintenance of the CIS and other types of irrigation systems shall be prepared by and coursed through the LGUs.
The NIA shall continue to provide technical assistance to the LGUs even after complete devolution of the Irrigation
Systems to the LGUs, as may be deemed necessary.
Section 32. Minor Irrigation Schemes. - The Department shall formulate and develop a plan for the promotion of a
private sector-led development of minor irrigation systems, such as Shallow Tube Wells (STWs), Low-Lift pumps
(LLPs) and other inundation systems. the plan shall be included in the Short-term Agriculture and fisheries
Modernization Plan.
Section 33. Other Irrigation Construction Schemes. - The Government shall also encourage the construction of
irrigation facilities through other viable schemes for the construction of irrigation such as build-operate-transfer,
build-transfer and other schemes that will fast-track the development of irrigation systems.
Section 34. Guarantee of the National Government. - To make build-operate-transfer (BOT) projects for irrigation
attractive to proponents, the national government shall issue the need payment guarantee for BOT projects which
shall answer for default of the National Irrigation Administration. Such amounts needed to answer for the payment
guarantee is hereby to be appropriated.
Section 35. Irrigation Service Fees (ISF). - Upon effectivity of this Act, the NIA shall immediately review the ISF
rates and recommend to the Department reasonable rates within six (6) months from the effectivity of this Act.
Section 36. Monitoring and Evaluation. - The Department shall monitor the implementation of R&D programs and
irrigation projects. The Department shall review all existing irrigation systems every four (4) years, to determine
their viability or ineffectiveness. The Department shall employ the services of independent evaluators to assess the
overall impact of the country's irrigation development .
Section 37. Exemption from Election Ban. - The repair, maintenance and rehabilitation of irrigation facilities as well
as BOT irrigation projects shall be exempted from the scope of the election ban on public works.
Chapter 5
Information and Marketing Support Service
Declaration of Policy. - It is hereby declared the policy of the State to empower Filipino farmers and fisherfolk,
particularly the women, involved in agriculture and fisheries through the provision of timely, accurate and
responsive business information and efficient trading services which will link them to profitable markets for their
products. They shall likewise be given innovative support toward the generation of maximum income through
assistance in marketing.
Section 39. Coverage. - A market information system shall be installed for the use and benefit of, but not limited to,
the farmers and fisher folk, cooperatives, traders, processors, the LGUs and the Department.
Section 40. The Marketing Assistance System. - The Department shall establish a National Marketing Assistance
Program that will immediately lead to the creation of a national marketing umbrella in order to ensure the generation
of the highest possible income for the farmers and fisher folk or groups of farmers and fisher folk, matching supply
and demand in both domestic and foreign markets.
Section 41. National Information Network. - A National Information Network (NIN) shall be set up from the
Department level down to the regional, provincial and municipal offices within one (1) year from the approval of
this Act taking into account existing information networks and seems.
The NIN shall likewise link the various research institutions for easy access to data on agriculture and fisheries
research and technology. All departments, agencies, bureaus, research institutions, and local government units shall
consolidate and continuously update all relevant information and data on a periodic basis and make such data
available on the Internet.
Section 42. Information and Marketing Service. - The NIN shall provide information and marketing services related
to agriculture an fisheries which shall include the following:
a. Supply data;
b. Demand data
c. Price and Price trends;
d. Product standards for both fresh and processed agricultural and fisheries projects;
e. Directory of, but not limited to cooperatives, traders, key market centers, processors and business institutions
concerned with agriculture and fisheries at the provincial and municipal levels;
f. Research information and technology generated from research institutions involved in agriculture and fisheries;
g. International, regional and local market forecasts; an
h. Resource accounting data.
Section 43. Initial Set-up. - The Department shall provide technical assistance in setting -up the NIN at the local
level through the cooperatives and the LGUs Provided , That , at the local level, a system that will make marketing
information and services related to agriculture and fisheries will be readily available in the city/municipal public
market for the benefit of the producers, traders and consumers.
Section 44. Role of Government Agencies. - The Bureau of Agricultural Statistics will serve as the central
information server and will provide technical assistance to end-users in accessing and analyzing product and market
information and technology.
The Department of Transportation and Communications shall provide technical and infrastructure assistance to the
Department in setting up the NIN.
LGUs shall coordinate with the Department for technical assistance in order to accelerate the establishment and
training of information end-users in their respective jurisdictions.
The Cooperative Development Authority shall coordinate with the Department for technical assistance in order to
provide training assistance to cooperatives in the use of market information and technology.
Section 45. Role of Private Sector. - The NIN shall likewise be accessible to the private sector engaged in
agriculture and fisheries enterprises. The Department shall formulate guidelines and determine fees for private sector
entities that use the NIN.
Chapter 6
Other Infrastructure
Section 46. Agriculture and Fisheries Infrastructure Support Services. - The Department of Public Works and
Highways , the Department of Transportation and Communications, the Department of Trade and Industry and the
LGUs shall coordinate with the Department to address the infrastructure requirements in accordance with this Act
Provided, that The Department and the LGU shall also strengthen its agricultural engineering support in carrying out
the smooth and expeditious implementation of agricultural infrastructure projects.
Section 47. Criteria for Prioritization. - The prioritization of government resources for rural infrastructure shall be
based on the following criteria:
a. Agro-industrial potential of the area;
b. Socio-economic contributions of the investments in the area;
c. Absence of public investments in the area; and
d. Presence of agrarian reform beneficiaries and other small farmers and fisher folk in the area.
Section 48. Public Infrastructure Facilities. - Public Infrastructure investments shall give preference to the kind ,
type and model of infrastructure facilities that are cost-effective and will be useful for the production, conservation,
and distribution of most commodities and should benefit the most number of agriculture and fisheries producers and
processors.
Section 49. Private Infrastructure Facilities. - For infrastructure facilities primarily benefiting private investors, the
State shall facilitate the purchase and use of such utilities and shall keep to the minimum the bureaucratic
requirements for these types of investments. Private investors include cooperatives or corporations of agriculture and
fisheries producers and processors.
Section 50. Public Works Act. - The Department of Public Works and Highways shall coordinate with the
Department for the purpose of determining the order of priorities for public works funded under the Public Works
Act directly or indirectly affect agriculture and fisheries.
Section 51. Fishports, Seaports and Airports. - The Department of Transportation and Communications, Philippine
Ports Authority and Philippine Fisheries Development Authority shall coordinate with the Department for the
purpose of determining priority fishports, seaports and airports and facilitating the installation of bulk-handling and
storage facilities , and other post-harvest facilities needed to enhance the marketing of agriculture and fisheries
products Provided, that fishports , seaports an airports are also equipped with quarantine , sanitary and phytosanitary
centers. The Department of Transportation and Communications (DOTC) shall have the mandate to cancel arrastre
and cargo handling franchises among operators whom it deems inefficient and/or ineffective owing, but not limited
to, a past history of under-capitalization, lack of equipment and lack of professional expertise. The DOTC shall
recommend to the Philippine Ports Authority and consult with ship-owners and ship-operators in assessing the
cargo-handling capabilities of cargo operators prior to extending new franchises or awards.
Section 52. Farm-to-Market Roads. - The Department shall coordinate with the LGUs and the resident-farmers and
fisher folk in order to identify priority locations of farm-to -market roads that take into account the number of farmer
and fisher folk and their families who shall benefit therefrom and the amount , kind and importance of agricultural
and fisheries products produced in the area.
Construction of farm-to-market roads shall be a priority investment of the LGUs which shall provide a counterpart
of not less than ten percent (10%) of the project cost subject to their IRA in the area.
Section 53. Rural Energy. - The Department shall coordinate with the Department of Energy (DOE), the Department
of Public Works and Highways (DPWH), the National Electrification Administration (NEA) and the National Power
Corporation (NAPOCOR) for the identification and installation of appropriate types of energy sources particularly
in the use of non-conventional energy sources for the locality in order to enhance agriculture and fisheries
development in the area.
Section 54. Communications Infrastructure. - The Department shall coordinate with the DOTC to facilitate the
installation of telecommunication facilities in priority areas, in order to enhance agriculture and fisheries
development .
Section 55. Water Supply System. - The Department shall coordinate with the DPWH and the LGUs for the
identification and installation of water supply system in the locality for agro-industrial uses to enhance agriculture
and fisheries development in the area.
Section 56. Research and Technology Infrastructure. - The Department in coordination with other government
agencies shall give priority and facilitate the funding of infrastructure necessary for research ventures such as farm
laboratories and demonstration farms with state colleges and universities that derive their core funds from the
Department .
Section 57. Post-Harvest Facilities. - The Department shall coordinate with the Bureau of Post-Harvest for Research
and Extension and the Post-harvest Horticulture, Training and Research Center of the University of the Philippines,
Los Baños, to identify appropriate post-harvest facilities and technology needed to enhance agriculture and fisheries
development in the area.
Section 58. Public Market and Abattoirs. - The Department shall encourage the LGUs to turn over the management
and supervision of public markets and abattoirs to market vendors' cooperatives and for that purpose, the
appropriation for post-harvest facilities shall include the support for market vendor' facilities.
The Department shall coordinate with the LGUs in the establishment of standardized market systems and use of
sanitary market , facilities , and abattoirs, intended to ensure the food safety and quality.
All markets shall have a sanitation unit, proper and adequate drainage and sewerage system, ample water supply,
public toilets with lavatories, garbage receptacles, ice plants and cold storage, adequate lighting and ventilation and
supply of electricity to ensure cleanliness and sanitation. Price monitoring bulletin boards for selected commodities
and weighing scales accessible to the public shall also be established.
Proper protection and preservation of agriculture and fisheries products being sold in the market shall also be
observed. All foods which require no further cooking shall be wrapped , covered , or enclosed in containers to
preserve the freshness and prevent contamination. Selling of products on market floors shall be prohibited.
Section 59. Agricultural Machinery. - The Department shall give priority to the development and promotion of
appropriate agricultural machinery and other agricultural mechanization technologies to enhance agricultural
mechanization in the countryside.
Chapter 7
Products Standardization and Consumer Safety
Section 60. Declaration of Policy. - It is the policy of the State that all sectors involved in the production,
processing, distribution and marketing of food and non-food agricultural and fisheries products shall adhere to, and
implement the use of product standards in order to ensure consumer safety and promote the competitiveness of
agriculture and fisheries products.
Section 61. Bureau of Agriculture and Fisheries Product Standards. - The Department, within six (6) months after
the approval of this act, and in consultation with the Department of Trade and Industry and the Bureau of Food and
Drug, shall establish the Bureau of Agriculture and Fisheries Product Standards (BAFPS).
Section 62. Coverage. - The BAFPS shall set and implement standards for fresh, primary-and -secondary-processed
agricultural and fishery products.
Section 63. Powers and Functions. - The BAFPS shall have the following powers and functions:
a. Formulate and enforce standards of quality in the processing, preservation, packaging, labeling, importation,
exportation, distribution, and advertising of agricultural and fisheries products;
b. Conduct research on product standardization, alignment of the local standards with the international standards;
and
c. Conduct regular inspection of processing plants, storage facilities, abattoirs, as well as public and private markets
in order to ensure freshness, safety and quality of products.
Section 64. Pool of Experts and Advisers. - The BAFPS may coordinate, seek the services of, and consult with both
private and governmental agencies, research institute, educational establishments and such other individuals and
entities with expertise in the field of product standards and consumer safety.
The Department of Trade and Industry, the Food and Nutrition Research Institute, and the Bureau of Food and Drug
Administration shall provide technical advice and form part of the pool of experts/advisers of the BAFPS.
TITLE 2
HUMAN RESOURCE DEVELOPMENT
Section 65. Declaration of Policy. - It is hereby declared the policy of the State to give priority to education and
training on science and technology in order to accelerate social progress and promote total human liberation and
development.
The State shall promote industrialization and full employment, based on sound agriculture and fisheries
development and agrarian reform, through industries that make full and efficient use of human and natural
resources.
Section 66. National Agriculture and Fisheries Education System (NAFES). - The Commission on Higher
Education (CHED), in coordination with the Department and appropriate government agencies, shall establish a
National Agriculture and Fisheries Education System (NAFES) which shall have the following objectives:
a. To establish, maintain and support a complete and integrated system of agriculture and fisheries education
relevant to the needs of the economy, the community and society.
b. To modernize and rationalize agriculture and fisheries education from the elementary to the tertiary levels;
c. To unify, coordinate and improve the system of implementation of academic programs that are geared toward
achieving agriculture and fisheries development in the country; and
d. To upgrade the quality , ensure sustainability and promote the global competitiveness, at all levels, of agriculture
and fisheries education.
Section 67. Education Program for Elementary and Secondary Levels. - There is hereby established an Agriculture
and Fisheries Education Program, under the NAFES specially designed for elementary and secondary levels. The
program shall be formulated, organized and implemented by the DECS with the following objectives:
a. to develop appropriate values that form the foundation for sustained growth in agriculture and fisheries
modernization.
b. to increase the attractiveness of agriculture and fisheries education, so that more young and talented person will
look at agriculture and fisheries as an acceptable option for career and livelihood;
c. to promote appreciation of science in agriculture and fisheries development;
d. to develop among students, positive attitudes towards entrepreneurship and global competition in the agriculture
and fisheries business;
e. to improve the present curriculum in the elementary and secondary levels by emphasizing the core values
necessary for agriculture and fisheries modernization; and
f. to develop an outreach program where students, parents and schools become instruments in effecting positive
changes in the pupil's home and community.
Section 68. Post-Secondary Education Program. - There is hereby established a Post-Secondary Education Program
for Agriculture and Fisheries under the NAFES, which shall be formulated and developed by TESDA in
coordination with the appropriate government agencies and the private sector. The program shall include, among
others, the following:
a. a mechanism for a flexible process of curriculum development;
b. integration of the dual training system in the various agricultural curricula and training programs;
c. integration of entrepreneurship and global competitiveness in the agro-fisheries curricula;
d. institutionalizing agriculture and fisheries skills standards and technical testing and certification;
e. regular upgrading of learning/training facilities, school buildings , laboratory equipment; and
f. development of a system for the strict enforcement of school regulations regarding standards and requirements.
Section 69. Network of National Centers of Excellence for Territory Education. - There is hereby established a
Network of National Centers of Excellence in Agriculture and Fisheries Education, composed of qualified public
and private colleges and universities, duly accredited as National Centers of Excellence (NCE) in the field of
agriculture and fisheries.
For this purpose, the CHED shall formulate and implement a system of accreditation Provided, That not more than
one provincial institute in every province and no more than one national university in each field in every region shall
be accredited as such and Provided, further, That the system shall be based on the following criteria:
a. institutional accessibility, population, economic contribution of agriculture and fisheries in the community, and
the needs or unique requirements of the area
b. quantity and quality of research studies conducted;
c. degree of utilization of research results;
d. quantity and quality of faculty members;
e. type of facilities;
f. linkage with international organizations; and
g. potential contribution to agriculture and fisheries development in the target area.
Section 70. Rationalization Plan. - For the purpose of upgrading and maintaining a high decree of academic
excellence in the fields of agriculture and fisheries, all existing public and private colleges and universities that are
not hereinafter designated and accredited as centers of excellence shall be given adequate time to redirect its
program to non-agriculture and/or non-fisheries areas needed by the province or region and/or merge their program
with accredited NCEs in accordance with the Rationalization Plan to be jointly formulated by CHED and the
Philippine Association of State Universities and Colleges (PASUC) upon consultation with the institution
concerned.
The Rationalization Plan shall include a policy for the effective utilization of affected personnel and facilities, and
shall not be construed as to result in the decrease of the budget allocation for the state universities and colleges
concerned.
Section 71. Counterpart Funding from LGUs. - The LGUs shall, within two, (2) years from the effectivity of this
Act, provide at least ten percent (10%) of the Maintenance and Other Operating Expenses (MOOE) budget for the
operation of the provincial institutes within their area of responsibility.
In consultation with the LGUs, the CHED shall develop a provincial-national partnership scheme for a reasonable
sharing of financial support taking into account social equity factors for poor provinces.
Section 72. National Integrated Human Resource Development Plan in Agriculture and Fisheries. - The CHED, in
coordination with the Department and appropriate government agencies, shall formulate, develop and implement an
integrated human resource development plan in agriculture and fisheries which shall serve as an instrument that will
provide over-all direction in setting priorities in curricular programs, enrollment, performance targets, and
investment programs.
Section 73. Output-Oriented Performance Standards. - In order to ensure the institutional accountability, efficiency,
and quality, there shall be formulated and developed an Output-Oriented Performance Standards which shall serve
as the primary instrument for institutional evaluation.
For this purpose, all public and private universities and colleges, that are designated as centers of excellence, shall
cause to be installed a computerized monitoring and evaluation system that periodically collects and regularly
measures variables indicating institutional performance based on the Output-Oriented Performance Standards.
Section 74. Evaluation System. - Not later than one (1) year from the effectivity of this Act, the CHED shall
establish a baseline information using the Output-Oriented Performance Standards referred to in Section 73 of this
Title. Once every five (5) years thereafter, all designated NCEs in agriculture and fisheries shall be subject to a third
party evaluation.
The evaluation shall include, among others, management and educational experts of national stature and
representatives of key sectors of the agriculture and fisheries industries, as well as representatives of the
Department, the Department of Environment and Natural Resources, the Department of Science and Technology,
and the National Economic and Development Authority.
Section 75. Agriculture and Fisheries Board. - There shall be created an Agriculture and Fisheries Board in the
Professional Regulation Commission to upgrade the Agriculture and Fisheries profession.
Those who have not passed the Civil Service Examination for Fisheries and Agriculture but have served the industry
in either private or public capacity for not less than five (5) years shall be automatically granted eligibility by the
Board of Examiners.
The first board of examination for B.S. Fisheries and/or Agriculture Graduates shall be conducted within one (1)
year from the approval of this Act.
Section 76. Continuing Agriculture and Fisheries Education Program. - The Commission on Higher Education, the
Department of Education, Culture and Sports and Technical Education and Skills Development Authority, in
coordination with the Department and the public and private universities and colleges, shall formulate and develop a
National and Integrated Continuing Agriculture and Fisheries Education Program, which shall address the current
education and training requirements of teachers, professors and educators in agriculture and fisheries.
For this purpose, pre-service and in-service training of teachers in Home Economics Livelihood Education (HELE)
for the primary level and Technology and Home Economics (THE) for the Secondary level, shall be upgraded.
Section 77. Scholarship Program. - The CHED in coordination with the public and private universities and colleges,
TESDA and the DBM, shall develop a national scholarship program that provides opportunities for deserving
academic staff to pursue advanced degrees in agriculture and fisheries. Where appropriate, such scholarship program
shall also provide opportunities for graduate work in foreign universities.
Section 78. Merit System. - To promote the development of scientific excellence and academic scholarship, the
public and private universities and colleges, in cooperation with the CHED and the DBM, shall institute an output-
oriented unified system of promotion for the academic personnel.
Section 79. Budgetary Allocation Scheme. - The Budgetary Allocation Scheme for NAFES shall be as follows:
a. The current appropriation or budgets of state universities and colleges, that are herein designate as NCEs, shall
continue and shall be modified and adjusted in succeeding years in order to meet the standards of the rationalized
programs of the institutions as approved by Congress and shall be included in the annual General Appropriations
Act;
b. NCEs that are created under this Act shall likewise be provided with budgetary support based on their programs
and a new staffing pattern as approved by DBM and shall be included in the annual General Appropriations Act.
TITLE 3
RESEARCH DEVELOPMENT AND EXTENSION
Chapter 1
Research and Development
Section 80. Declaration of Policy. - It is hereby declared the policy of the State to promote science and technology
as essential for national development and progress.
The State shall likewise give priority to research and development, invention, innovation, and their utilization and to
science and technology education, training, and services. In addition to appropriate and relevant technology, the
state shall support indigenous and self-reliant scientific and technological capabilities, and their application to the
country's productive system and national life.
Section 81. The National Research and Development System in Agriculture and Fisheries. - The Department, in
coordination with the Department of Science and Technology and other appropriate agencies and research
institutions shall enhance, support and consolidate the existing National Research and Development System in
Agriculture and Fisheries within six (6) months from the approval of this Act. Provided, That fisheries research and
development shall be pursued separately, from but in close coordination with that of agriculture.
Section 82. Special Concerns in Agriculture and Fisheries Research Services. - Agriculture and Fisheries Research
and Development activities shall be multidisciplinary and shall involve farmers, fisherfolk and their organizations,
and those engaged in food and non-food production and processing including the private and public sectors.
Research institutions and centers shall enjoy autonomy and academic freedom. The Department, in collaboration
with the Department of Science and Technology and other appropriate agencies, shall harmonize its merit and
output-oriented promotion system governing the scientific community in order to promote increased research
excellence and productivity and provide the government research system a competitive edge in retaining its
scientific personnel.
Appropriate technology shall be used to protect the environment, reduce cost of production , improve product
quality and increase value added for global competitiveness.
Section 83. Funds for Research and Development. - Considering the nature of research, development and extension
activities, funding shall be based on the following guidelines:
a. Allocation of multi-year budgets which shall be treated as research and development grants.
b. The budget for agriculture and fisheries research and development shall be at least one percent (1%) of the gross
value added (GVA) by year 2001 allocating at least one percent (1%) of the total amount by 1999. The Department
of Finance (DOF) in consultation with the Department shall formulate revenue enhancement measures to fund this
facility.
c. At least twenty percent (20%) shall be spent in support of basic research and not more than eighty percent (80%)
shall be used for applied research and technology packaging and transfer activities.
d. A science fund shall be established from which the scientific community in agriculture and fisheries shall draw its
financial resource for sustained career development, Provide, That only the interest earnings of the funds shall be
used.
The Department and other research agencies, in the national interest, are encouraged to go into co-financing
agreements with the private sector in the conduct of research and development provided that the terms and
conditions of the agreement are beneficial to the country.
Section 84. Excellence and Accountability in Research and Development. - The Department, in collaboration with
the Department of Science and Technology and other appropriate government agencies, shall formulate the national
guidelines in evaluating research and development activities and institutions, which shall involve an independent
and interdisciplinary team of collegial reviewer and evaluators.
Section 85. Communication of Research Results and Research-Extension Linkage. - Research information and
technology shall be communicated through the National Information Network (NIN)
All government agencies including the state colleges and universities and private educational institutions selected as
NCEs shall be computerized , networked , provided with regular updated information and shall likewise provide,
through the NIN results of research and development activities and current available technology relating agriculture
and fisheries.
Chapter 2
Extension Services
Section 86. Declaration of Policy. - It is hereby declared the policy of the State to promote science and technology
as essential for national development and progress. The State shall give priority for the utilization of research results
through formal and non-formal education, extension, and training services. It shall support the development of a
national extension system that will help accelerate the transformation of Philippine agriculture and fisheries from a
resource -based to a technology-based industry.
Section 87. Extension Services. - Agriculture and Fisheries extension services shall cover the following major
services to the farming and fishing community:
a. Training services;
b. Farm or business advisory services;
c. Demonstration services; and
d. Information and communication support services through trimedia.
Section 88. Special Concerns in the Delivery of Extension services. - The delivery of agriculture and Fisheries
Extension Services shall be multidisciplinary and shall involve the farmers, fisherfolk, and their organizations and
those engaged in food and non-food production and processing, including the private and public sectors.
There shall be a national merit and promotion system governing all extension personnel, regardless of source of
funding, to promote professionalism and achieve excellence and productivity in the provision of the government
extension services.
Section 89. The National Extension System for Agriculture and Fisheries (NESAF). - The Department in
coordination with the appropriate government agencies, shall formulate a National Extension System for Agriculture
and Fisheries.
The National Extension System for Agriculture and Fisheries shall be composed of three (3) subsystems:
a. the national government subsystem which directly complements;
b. The local government subsystems; and
c. the private sector subsystem.
Section 90. The Role of Local Government Units. - The LGUs shall be responsible for delivering direct agriculture
and fisheries extension services.
The provincial governments shall integrate the operations for the agriculture extension services and shall undertake
an annual evaluation of all municipal extension programs.
The extension program of state colleges and universities shall primarily focus on the improvement of the capability
of the LGU extension service by providing:
a) Degree and non-degree training programs;
b) Technical assistance;
c) Extension cum research activities;
d) Monitoring and evaluation of LGU extension projects; and
e) Information support services through the tri-media and electronics.
Section 91. Role of the Private Sector in Extension. - The department shall encourage the participation of farmers
and fisherfolk cooperatives and associations and others in the private sector in the training and other complementary
extension services especially in community organizing, use of participatory approaches, popularization of training
materials, regenerative agricultural technologies, agri-business and management skills.
The Department is hereby authorized to commission and provide funding for such training and extension services
undertaken by the private sector.
Section 92. The Role of Government Agencies. - The Department, together with state colleges and universities shall
assist in the LGU's extension system by improving their effectiveness and efficiency through capability-building and
complementary extension activities such as:
a) technical assistance;
b) training of LGU extension personnel;
c) improvement of physical facilities;
d) extension cum research; and
e) information support services;
Section 93. Funding for Extension Activities. - Extension activities shall be supported by the following measures:
a) allocation of multi-year budgets that shall be treated as grants;
b) allow transfer of funds from the Department to the local government units as extension grants, and
c) the budget for agriculture and fisheries extension services shall be at least one percent (1%) of the gross value
added (GVA) by year 2001
Section 94. Excellence and Accountability in Extension. - The Department shall formulate the guidelines in
evaluating extension, activities, and institutions, which shall involve an independent and interdisciplinary team of
the collegial reviewers and evaluators.
Section 95. Extension Communication Support for LGU's. - The Department in coordination with the public and
private universities and colleges, shall develop an integrated multimedia support for national and LGU extension
programs. The Department shall assist the LGU's in the computerization of communication support services to
clients and linkages to the NIN.
TITLE 4
RURAL NON-FARM EMPLOYMENT
Chapter 1
Section 96. Declaration of policy. - It is hereby declared the policy of the State to promote full employment.
Economic history, however, shows that as an economy modernizes the number of workers employed in its
agricultural sector declines. It is therefore necessary to formulate policies and implement programs that will employ
workers efficiently in rural areas in order to improve their standard of living, and reduce their propensity to migrate
to urban areas.
Section 97. Objectives. - Rural non-farm employment aims to:
a) promote a basic needs approach to rural development;
b) make rural workers more adaptable and flexible through education and training;
c) promote rural industrialization and the establishment of agro- processing enterprises in rural communities; and
d)increase the income of rural workers.
Chapter 2
The Basic Needs Program
Section 98. Principles. - The Department, in coordination with the appropriate government agencies, shall formulate
the Basic Needs Program to create employment and cushion the effect of liberalization based on the following
principles:
a) No credit subsidies shall be granted. The normal rules of banking shall apply to all enterprises involved, provided
that existing credit arrangements with ARBs shall not be affected.
b) Enterprises can use training, information, advisory and related services of the Government free of charge.
c) The participation of the private sector shall be voluntary.
Teams composed of specialists from government agencies and the private sectors shall develop pilot programs in
selected locales to establish the planning, implementation and evaluation procedures.
Section 99. Participation of Government Agencies. - The replication of the program shall be the responsibility of the
local government units concerned in collaboration with the appropriate government agencies, and the private sector.
The local government units shall bear the costs of promoting and monitoring the basic needs program for which
their IRA shall be increased accordingly as recommended by the Secretary of the Department Provided, That the
appropriate national government agencies shall continue to provide the necessary technical as well as financial
assistance to the LGUs in the replication of the program.
The Cooperatives Development Authority shall encourage the establishment and growth of associations and
cooperatives as vehicles for the stable expansion of basic needs enterprises
The Department of Education, Culture and Sports, Department of Health, and the Technical Education and Skills
Development Authority shall coordinate with the Department and Congress in the review, rationalization and
reallocation of their regular budgets as well as their budgets under the GATT- related measures fund to finance
education, training, health and other welfare services for farmers and fisherfolk.
Chapter 3
Rural Industrialization
Industry Dispersal Program
Section 100. Principles. - Rural industrialization and industry dispersal programs shall be based on the interplay of
market forces. The Board of Investments (BOI) is hereby required to give the highest priority to the grant of
incentives to business and industries with linkages to agriculture.
Section 101. Role of Government Agencies. - The appropriate government agencies, under the leadership of the
LGUs concerned, shall provide integrated services and information to prospective enterprises under the one-stop-
shop concept.
Local government units are authorized to undertake investment and marketing missions provided that the costs of
such missions are borne by the LGUs concerned. In making their land use plans, the LGUs, in consultation with the
appropriate government agencies concerned, shall identify areas for industrial parks.
The Department shall coordinate with the Department of Trade and Industry , in particular, the Board of
Investments, in the formulation of investments priorities for rural areas.
The Regional Wage Boards shall consult participating enterprises in this program before they issue wage orders.
Section 102. Participating Enterprises. - Participating enterprises may request any government agency for training,
technical and advisory services free of cost.
A set of incentives shall be given to enterprises that subcontract part of their production to farmers, fisherfolk and
landless workers during periods when they are not engaged in agricultural activities.
Section 103. Financing. - Except for basic infrastructure and other goods that benefit all citizens, the facilities of this
program should be undertaken and financed by the private sector.
Chapter 4
Training of Workers
Section 104. Role of TESDA. - TESDA shall organize local committees that will advise on the scope, nature and
duration of training for the above-mentioned programs.
TESDA is authorized to request the additional budgetary resources for these programs: Provided, That after a
reasonable period, the task of coordinating the training is transferred to the LGUs concerned.
Section 105. Role of the DENR. - The Department and the DENR shall organize the training of workers in coastal
resources management and sustainable fishing techniques.
Section 106. Role of the Technology and Livelihood Resource Center (TLRC). - The TLRC shall undertake field
training in entrepreneurship and management of workers involved in the basic needs program
Section 107. Special Training Projects for Women. - The Department, in collaboration with the appropriate
government agencies concerned shall plan and implement special training projects for women for absorption in the
basic needs and rural industrialization programs.
TITLE 5
TRADE AND FISCAL INCENTIVES
Section 108. Taxation policies must not deter the growth of value-adding activities in the rural areas.
Section 109. All enterprises engaged in agriculture and fisheries as duly certified by the Department in consultation
with the Department of Finance and the board of Investment, shall, for five (5) years after the effectivity of this Act,
be exempted from the payment of tariff and duties for the importation of all types of agriculture and fisheries inputs,
equipment and machinery such as, but not limited to, fertilizer, insecticide, pesticide, tractor, trailers, trucks, farm
implements and machinery, harvesters, threshers, hybrid seeds, genetic materials, sprayers, packaging machinery
and materials, bulk-handling facilities such as conveyors and mini loaders, weighing scales, harvesting equipment,
spare parts of all agricultural equipment, fishing equipment and parts thereof, refrigeration equipment, and
renewable energy systems such as solar panels Provided, however, That the imported agricultural and fishery inputs,
equipment and machinery shall be for the exclusive use of the importing enterprise.
The Department, in consultation with the Department of Finance and the Board of Investment, shall, within ninety
(90) days from the effectivity of this Act, formulate the implementing rules and regulations governing the
importation of agriculture and fishery inputs, equipment and machinery.
Section 110. Any person, partnership, corporation, association and other juridical entity found circumventing the
provisions of Section 109 of this Act shall suffer the penalty of imprisonment for a period of not less than six (6)
months but not more than one (1) year, or a fine equivalent to two hundred percent (200%) of the value of the
imported materials, or both, at the discretion of the court, and the accessory penalties of confiscation of the imported
goods in favor of the government and revocation of the privileges given under this title.
In cases where the violator is a juridical entity, the officers responsible in the violation of Section 109 shall suffer
the penalty of imprisonment prescribed in this Section.
The importation of goods equivalent to or exceeding the declared assets of the enterprise, partnership, or the
authorized capital stock in case of corporations, and/or the resale of the imported goods shall be a prima facie
evidence of the violation of the provisions of Section 109 of this Act.
GENERAL PROVISIONS
Section 111. Initial Appropriation. - For the first year of implementation of this Act, the amount of Twenty Billion
pesos (P20,000,000,000.00) is hereby appropriated. The Department is hereby authorized to re-align its
appropriations in the current year of the date of effectivity of this Act to conform with the requirements of this Act
Provided, That the amount shall be allocated and disbursed as follows:
1. Thirty percent (30%) for irrigation;
2. Ten percent (10%) for post-harvest facilities Provided, That the Secretary of Agriculture may invest up to fifty
percent (50%) of the said amount to fund post-harvest facilities of cooperatives, especially market vendors'
cooperatives, where said cooperatives exist and are operational Provided, further, That if no cooperatives are
operational, said amount shall fund the post-harvest facilities of the market -assistance system;
3. Ten percent (10%) for other infrastructure including fishports, seaports, and airports, farm-and -coast-to-market
roads, rural energy, communications infrastructure, watershed rehabilitation, water supply system, research and
technology infrastructure, public markets and abattoirs;
4. Ten percent (10%) for the Agro-industry Modernization Credit and Financing Program (AMCFP) to be deposited
by the Department in participating rural-based public and private financial institutions provided that no less than
fifty percent (50%) of said funds shall be deposited in rural banks in cooperative banks;
5. Eight percent (8%) for the implementation of the Farmer-Fisherfolk Marketing Assistance System and support of
market vendors' cooperatives;
6. Ten percent (10%) for research and development, four percent (4%) of which shall be used to support the
Biotechnology Program;
7. Five percent (5%) for capability-building of farmers and fisherfolk organizations and LGUs for the effective
implementation of the agriculture and fisheries programs at the local level;
8. Six percent (6%) for salary supplement of Extension Workers under the LGUs;
9. Five percent (5%) for NAFES , for the upgrading of the facilities of State Universities and Colleges that will be
chosen as national center of excellence in agriculture and fisheries education;
10. Four percent (4%) for the National Information Network (NIN) consisting of both the national and local levels;
11. One-and-three-fourth percent (1.75%) for SUC- and TESDA-administered Rural Non-Farm Employment
Training; and
12. One-fourth percent (0.25%) for the identification of the SAFDZs.
Section 112. Continuing Appropriation. - The Department of Budget and Management (DBM) is hereby mandated
to include annually in the next six (6) years, in the President's Program of expenditures for submission to Congress,
and release, an amount not less than Seventeen billion pesos (P17,000,000,000.00) for the implementation of this
Act.
Additional funds over and above the regular yearly budget of the Department shall be sourced from twenty percent
(20%) of the proceeds of the securitization of government assets, including the Subic, Clark, and other special
economic zones.
Other sources of funds shall be from the following:
a. Fifty Percent (50%) of the net earnings of the Public Estates Authority;
b. Loans, grants, bequest, or donations, whether from local or foreign sources;
c. Forty percent (40%) of the TESDA Skills Development Fund;
d. Net proceeds from the privatization of the Food Terminal Inc. (FTI), the Bureau of Animal Industry (BAI), the
Bureau of Plant Industry (BPI), and other assets of the Department that will be identified by the DA Secretary and
recommended to the President for privatization;
e. Proceeds from the Minimum Access Volume (MAV) in accordance with the provisions of Republic Act No.
8178;
f. Poverty alleviation Fund; and
g. Fifty Percent (50%) of the Support Facilities and Services Fund under Republic Act No. 6657.
Section 113. Implementing Rules and Regulations. - The Secretary within ninety (90) working days after the
effectivity of this act, together with the Department of Agrarian Reform (DAR), Department of Environment and
Natural Resources (DENR), Department of Finance (DOF), Department of Science and Technology (DOST),
Department of Trade and Industry (DTI), Commission on Higher Education (CHED), Technical Education and
Skills Development Authority (TESDA), Department of Education , Culture and sports (DECS), Department of
Social services and Development (DSSD), National Economic and Development Authority (NEDA), Department of
Budget and Management (DBM), Department of Labor and Employment (DOLE), Commission on Audit (COA),
Civil Service Commission (CSC), in consultation with other agencies concerned, farmers, fisherfolk and
agribusiness organizations, and in coordination with the Congressional Oversight committee on Agriculture and
Fisheries Modernization, shall promulgate the rules and regulations for the effective implementation of this act.
The Secretary shall submit to the Committee on Agriculture of both houses of congress copies of the implementing
rules and regulations within thirty (30) days after their promulgation.
Any violation of this section shall render the official/s concerned liable under Republic Act. No. 6713 otherwise
known as the "Code of Conduct and Ethical Standards for Public Officials and Employees" and other existing
administrative and/or criminal laws.
Section 114. Congressional Oversight Committee on Agricultural and Fisheries Modernization. - A congressional
Committee on Agricultural and Fisheries Modernization is hereby created to be composed of the Chairs of the
Committee on Agriculture of both Houses, six (6) members of the House of Representatives and six (6) members of
the Senate, to be designated respectively by the Speaker of the House and the President of the Senate, who shall
endeavor to have the various sectors and regions of the country represented.
The Chairs of the Committees on Agriculture in the Senate and House of Representatives, shall be respectively, the
Chair and Co-Chair of the Oversight Committee. The other members shall receive no compensation: however,
traveling and other necessary expenses shall be allowed.
The Committee shall oversee and monitor the implementation of the Congressional Commission on Agricultural
Modernization (AGRICOM) recommendations as well as all programs, projects and activities related to agriculture
and fisheries, and its allied concerns in both public and private sectors, with a view to providing all legislative
support and assistance within the powers of Congress to ensure their inclusion, wherever feasible, in the national,
regional, provincial, municipal, and sectoral development plans to recommend the disposal of assets no longer
needed by the Department to fund the modernization program, and to see them through their successful
implementation.
Section 115. Powers and Functions of the Committee. - The Congressional Oversight on Agriculture and Fisheries
Modernization shall have the following powers and functions:
a. Prescribe and adopt guidelines that will govern its work;
b. Hold hearings, receive testimonies and reports pertinent to its specified concerns;
c. Secure from any department, bureau, office or instrumentality of the Government such assistance as may be
needed, including technical information, preparation, and production of reports and submission of recommendations
or plans as it may require
d. Summon by subpoena any public or private citizen to testify before it, or require by subpoena duces tecum to
produce before it such records, reports or other documents as may be necessary in the performance of its functions;
e. Use resource persons from the public and private sectors as may be needed;
f. Carry on the winding-up work of AGRICOM, such as editing and printing all technical reports and studies as well
as bibliographic cataloguing of its collection of source materials, continue its information and advocacy work;
g. Cause to be transferred to the Committee all works, outputs, source materials, and assets, funds, supplies and
equipment of AGRICOM;
h. Approve the budget for the work of the Committee and all disbursements therefrom , including compensation of
all personnel;
i. Organize its staff and hire and appoint such employees and personnel whether temporary , contractual or on
consultancy, subject to applicable rules; and
j. Generally to exercise all the powers necessary to attain the purposes for which its created.
Section 116. Periodic Reports. - The Committee shall submit periodic reports on its findings and make
recommendations on actions to be taken by Congress and the appropriate department, and in order to carry out the
objectives of this Act, an initial amount of Twenty million pesos (P20,000,000.00) is hereby appropriated for the
Oversight Committee for the first year of its operation.
Section 117. Automatic Review. - Every five (5) years after the effectivity of this Act, an independent review panel
composed of experts to be appointed by the President shall review the policies and programs in the Agriculture and
Fisheries Modernization Act and shall make recommendations, based on its findings, to the President and to both
Houses of Congress.
Section 118. Repealing Clause. - All laws, decrees, executive issuance, rules and regulations inconsistent with this
Act are hereby repealed or modified accordingly.
Section 119. 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 of the other provisions shall not be affected
thereby.
Section 120. Effectivity. - 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 general circulation.
Approved: 22 December 1997
Suspended Particulate
a
Maximum limits represented by ninety-eight percentile (98%) values not to be exceed more than once a year.
b
Arithmetic mean
c
SO2 and Suspended Particulate matter are sampled once every six days when using the manual methods. A
minimum of twelve sampling days per quarter of forty-eight sampling days each year is required for these methods.
Daily sampling may be done in the future once continuous analyzers are procured and become available.
d
Limits for Total Suspended Particulate Matter with mass median diameter less than 25-50 um.
e
Annual Geometric Mean
f
Provisional limits for Suspended Particulate Matter with mass median diameter less than 10 microns and below
until sufficient monitoring data are gathered to base a proper guideline.
g
Evaluation of this guideline is carried out for 24-hour averaging time and averaged over three moving calendar
months. The monitored average value for any three months shall not exceed the guideline value.
(b) For National Ambient Air Quality Standards for Source Specific Air Pollutants from Industrial
Sources/Operations:
7. Lead 20 30 AASc
1
Pertinent ambient standards for Antimony, Arsenic, Cadmium, Asbestos, Nitric Acid and Sulfuric Acid Mists in
the 1978 NPCC Rules and Regulations may be considered as guides in determining compliance.
2
Ninety-eight percentile (98%) values of 30-minute sampling measured at 250C and one atmosphere pressure.
3
Other equivalent methods approved by the Department may be used.
The basis in setting up the ambient air quality guideline values and standards shall reflect, among others, the latest
scientific knowledge including information on:
a) Variable, including atmospheric conditions, which of themselves or in combination with other factors may alter
the effects on public health or welfare of such air pollutant;
b) The other types of air pollutants which may interact with such pollutant to produce an adverse effect on public
health or welfare; and
c) The kind and extent of all identifiable effects on public health or welfare which may be expected from presence of
such pollutant in the ambient air, in varying quantities.
The Department shall base such ambient air quality standards on World Health Organization (WHO) standards, but
shall not be limited to nor be less stringent than such standards.
Section 13. Emission Charge System. - The Department, in case of industrial dischargers, and the Department of
Transportation and Communication (DOTC), in case of motor vehicle dischargers, shall, based on environmental
techniques, design, impose on and collect regular emission fees from said dischargers as part of the emission
permitting system or vehicle registration renewal system, as the case may be. The system shall encourage the
industries and motor vehicles to abate, reduce, or prevent pollution. The basis of the fees include, but is not limited
to, the volume and toxicity of any emitted pollutant. Industries, which shall install pollution control devices or
retrofit their existing facilities with mechanisms that reduce pollution shall be entitled to tax incentives such as but
not limited total credits and/or accelerated depreciation deductions.
Section 14. Air Quality Management Fund. - An Air Quality Management Fund to be administered by the
Department as a special account in the National Treasury is hereby established to finance containment, removal, and
clean-up operations of the Government in air pollution cases, guarantee restoration of ecosystems and rehabilitate
areas affected by the acts of violators of this Act, to support research, enforcement and monitoring activities and
capabilities of the relevant agencies, as well as to provide technical assistance to the relevant agencies. Such fund
may likewise be allocated per airshed for the undertakings herein stated.
The Fund shall be sourced from the fines imposed and damages awarded to the Republic of the Philippines by the
Pollution Adjudication Board (PAB), proceeds of licenses and permits issued by the Department under this Act,
emission fees and from donations, endowments and grants in the forms of contributions. Contributions to the Fund
shall be exempted from donor taxes and all other taxes, charges or fees imposed by the Government.
Section 15. Air Pollution Research and Development Program. - The Department, in coordination with the
Department of Science and Technology (DOST), other agencies, the private sector, the academe, NGO’s and PO’s,
shall establish a National Research and Development Program for the prevention and control of air pollution. The
Department shall give special emphasis to research on and the development of improved methods having industry-
wide application for the prevention and control of air pollution.
Such a research and development program shall develop air quality guideline values and standards in addition to
internationally-accepted standards. It shall also consider the socio-cultural, political and economic implications of
air quality management and pollution control.
Article Two
Air Pollution Clearances and Permits for Stationary Sources
Section 16. Permits. - Consistent with the provisions of this Act, the Department shall have the authority to issue
permits as it may determine necessary for the prevention and abatement of air pollution.
Said permits shall cover emission limitations for the regulated air pollutants to help attain and maintain the ambient
air quality standards. These permits shall serve as management tools for the LGUs in the development of their action
plan.
Section 17. Emission Quotas. - The Department may allow each regional industrial center that is designated as
special airshed to allocate emission quotas to pollution sources within its jurisdiction that qualify under an
environmental impact assessment system programmatic compliance program pursuant to the implementing rules and
regulations of Presidential Decree No. 1586.
Section 18. Financial Liability for Environmental Rehabilitation. - As part of the environmental management plan
attached to the environmental compliance certificate pursuant to Presidential Decree No. 1586 and rules and
regulations set therefor, the Department shall require program and project proponents to put up financial guarantee
mechanisms to finance the needs for emergency response, clean-up rehabilitation of areas that may be damaged
during the program or project’s actual implementation. Liability for damages shall continue even after the
termination of a program or project, where such damages are clearly attributable to that program or project and for a
definite period to be determined by the Department and incorporated into the environmental compliance certificate.
Financial liability instruments may be in the form a trust fund, environmental insurance, surety bonds, letters of
credit, as well as self-insurance. The choice of the guarantee instruments shall furnish the Department with evidence
of availment of such instruments.
Article Three
Pollution from Stationary Sources
Section 19. Pollution From Stationary Sources. - The Department shall, within two (2) years from the effectivity of
this Act, and every two (2) years thereafter, review, or as the need therefore arises, revise and publish emission
standards, to further improve the emission standards for stationary sources of air pollution. Such emission standards
shall be based on mass rate of emission for all stationary source of air pollution based on internationally accepted
standards, but not be limited to, nor be less stringent than such standards and with the standards set forth in this
section. The standards, whichever is applicable, shall be the limit on the acceptable level of pollutants emitted from
a stationary source for the protection of the public’s health and welfare.
With respect to any trade, industry, process and fuel-burning equipment or industrial plant emitting air pollutants,
the concentration at the point of emission shall not exceed the following limits:
6. Hydrofluoric Acids and Any source other than the 50 as HF Titration with Ammonium
Fluoride compounds manufacture of Aluminum from Thiocyanate
Alumina
a
Other equivalent methods approved by the Department may be used.
b
Atomic Absorption Spectrophometry
c
All new geothermal power plants starting construction by 01 January 1995 shall control HsS emissions to not more
than 150g/GMW-Hr
d
All existing geothermal power plants shall control HsS emissions to not more than 200g/GMW-Hr. within 5 years
from the date of efectivity of these revised regulations.
e
Best practicable control technology for air emissions and liquid discharges. Compliance with air and water quality
standards is required.
f
Emission limit of Nickel Carbonyl shall not exceed 0.5 mg/Ncm.
g
Provisional Guideline
Provided, That the maximum limits in mg/ncm particulates in said sources shall be:
a
Other Stationary Sources refer to existing and new stationary sources other than those caused by the manufacture
of sulfuric acid and sulfonation process, fuel burning equipment and incineration.
For stationary sources of pollution not specifically included in the immediately preceding paragraph, the following
emission standards shall not be exceeded in the exhaust gas:
I. Daily And Half Hourly Average Values
II. All the Average Values Over the Sample Period of a Minimum of 4 and Maximum of 8 Hours.
These average values cover also gaseous and the vapor forms of the relevant heavy metal emission as well as their
compounds: Provided, That the emission of dioxins and furans into the air shall be reduced by the most progressive
techniques: Provided, Further, That all average of dioxin and furans measured over the sample period of a minimum
of 5 hours and maximum of 8 hours must not exceed the limit value of 0.1 nanogram/m 3.
Pursuant to Sec. 8 of this Act, the Department shall prepare a detailed action plan setting the emission standards or
standards of performance for any stationary source the procedure for testing emissions for each type of pollutant,
and the procedure for enforcement of said standards.
Existing industries, which are proven to exceed emission rates established by the Department in consultation with
stakeholders, after a thorough, credible and transparent measurement process shall be allowed a grace period of
eighteen (18) months for the establishment of an environmental management system and the installation of an
appropriate air pollution control device : Provided, That an extension of not more than twelve (12) months may be
allowed by the Department on meritorious grounds.
Section 20. Ban on Incineration. - Incineration, hereby defined as the burning of municipal, biomedical and
hazardous waste, which process emits poisonous and toxic fumes is hereby prohibited; Provided, however, That the
prohibition shall not apply to traditional small-scale method of community/neighborhood sanitation "siga",
traditional, agricultural, cultural, health, and food preparation and crematoria; Provided, Further, That existing
incinerators dealing with a biomedical wastes shall be out within three (3) years after the effectivity of this
Act; Provided, Finally, that in the interim, such units shall be limited to the burning of pathological and infectious
wastes, and subject to close monitoring by the Department.
Local government units are hereby mandated to promote, encourage and implement in their respective jurisdiction a
comprehensive ecological waste management that includes waste segregation, recycling and composting.
With due concern on the effects of climate change, the Department shall promote the use of state-of-the-art,
environmentally-sound and safe non-burn technologies for the handling, treatment, thermal destruction, utilization,
and disposal of sorted, unrecycled, uncomposted, biomedical and hazardous wastes.
Article Four
Pollution from Motor Vehicles
Section 21. Pollution from Motor Vehicles. - a) The DOTC shall implement the emission standards for motor
vehicles set pursuant to and as provided in this Act. To further improve the emission standards, the Department shall
review, revise and publish the standards every two (2) years, or as the need arises. It shall consider the maximum
limits for all major pollutants to ensure substantial improvement in air quality for the health, safety and welfare of
the general public.
The following emission standards for type approval of motor vehicles shall be effective by the year 2003:
a) For light duty vehicles, the exhaust emission limits for gaseous pollutants shall be:
Emission Limits for Light Duty Vehicles
Type Approval
(Directive 91/441/EEC)
CO HC + NOx PMa
(g/km) (g/km) (g/km)
2.72 0.970.14
a
for compression-ignition engines only
b) For light commercial vehicles, the exhaust emission limit of gaseous pollutants as a function of the given
reference mass shall be:
Emission Limits for Light Commercial Vehicles
Type Approval
(Directive 93/59/EEC)
CO HC NOx PM
(g/k/Wh) (g/k/Wh) (g/k/Wh) (g/k/Wh)
4.5 1.1 8.0 0.36a
a
In the case of engines of 85 kW or less, the limit value for particular emissions in increased by multiplying the
quoted limit by a coefficient of 1.7
Fuel evaporative emission for spark-ignition engines shall not exceed 2.0 grams hydrocarbons per test. Likewise, it
shall not allow any emission of gases from crankcase ventilation system into the atmosphere.
b) The Department, in collaboration with the DOTC, DTI and LGUs, shall develop an action plan for the control and
management of air pollution from motor vehicles consistent with the Integrated Air Quality Framework. The DOTC
shall enforce compliance with the emission standards for motor vehicles set by the Department. The DOTC may
deputize other law enforcement agencies and LGUs for this purpose. To this end, the DOTC shall have the power to:
(1) Inspect and monitor the emissions of motor vehicles;
(2) Prohibit or enjoin the use of motor vehicles or a class of motor vehicles in any area or street at specified times;
and
(3) Authorize private testing emission testing centers duly accredited by the DTI.
c) The DOTC, together with the DTI and the Department, shall establish the procedures for the inspection of motor
vehicles and the testing of their emissions for the purpose of determining the concentration and/or rate of pollutants
discharged by said sources.
d) In order to ensure the substantial reduction of emissions from motor vehicles, the Department of Trade and
Industry (DTI), together with the DOTC and the Department shall formulate and implement a national motor vehicle
inspection and maintenance program that will promote efficient and safe operation of all motor vehicles. In this
regard, the DTI shall develop and implement standards and procedures for the certification of training institutions,
instructors and facilities and the licensing of qualified private service centers and their technicians as prerequisite for
performing the testing, servicing, repair and the required adjustment to the vehicle emission system. The DTI shall
likewise prescribe regulations requiring the disclosure of odometer readings and the use of tamper-resistant
odometers for all motor vehicles including tamper-resistant fuel management systems for the effective
implementation of the inspection and maintenance program.
Section 22. Regulation of All Motor Vehicles and Engines. - Any imported new or locally-assembled new motor
vehicle shall not be registered unless it complies with the emission standards set pursuant to this Act, as evidenced
by a Certificate of Conformity (COC) issued by the Department.
Any imported new motor vehicle engine shall not be introduced into commerce, sold or used unless it complies with
emission standards set pursuant to this Act.
Any imported used motor vehicle or rebuilt motor vehicle using new or used engines, major parts or components
shall not be registered unless it complies with the emission standards.
In case of non-compliance, the importer or consignee may be allowed to modify or rebuild the vehicular engine so it
will be in compliance with applicable emission standards.
No motor vehicle registration (MVR) shall be issued unless such motor vehicle passes the emission testing
requirement promulgated in accordance with this Act. Such testing shall be conducted by the DOTC or its
authorized inspection centers within sixty (60) days prior to date of registration.
The DTI shall promulgate the necessary regulations prescribing the useful life of vehicles and engines including
devices in order to ensure that such vehicles will conform to the emissions which they were certified to meet. These
regulations shall include provisions for ensuring the durability of emission devices.
Section 23. Second-Hand Motor Vehicle Engines. - Any imported second-hand motor vehicle engine shall not be
introduced into commerce, sold or used unless it complies with emission standards set pursuant to this Act.
Article Five
Pollution from Other Sources
Section 24. Pollution from smoking. - Smoking inside a public building or an enclosed public place including
public vehicles and other means of transport or in any enclosed area outside of one's private residence, private place
of work or any duly designated smoking area is hereby prohibited under this Act. This provision shall be
implemented by the LGUs.
Section 25. Pollution from other mobile sources. - The Department, in coordination with appropriate agencies,
shall formulate and establish the necessary standards for all mobile sources other than those referred to in Sec. 21 of
this Act. The imposition of the appropriate fines and penalties from these sources for any violation of emission
standards shall be under the jurisdiction of the DOTC.
Chapter 3
Fuels, Additives, Substances and Pollutants
Article One
Fuels, Additives and Substances
Section 26. Fuels and Additives. - Pursuant to the Air Quality Framework to be established under Section 7 of this
Act, the Department of Energy (DOE), co-chaired by the Department of Environment and Natural Resources
(DENR), in consultation with the Bureau of Product Standards (BPS) of the DTI, the DOST, the representatives of
the fuel and automotive industries, academe and the consumers shall set the specifications for all types of fuel and
fuel-related products, to improve fuel composition for increased efficiency and reduced emissions: Provided,
however, that the specifications for all types of fuel and fuel-related products set-forth pursuant to this section shall
be adopted by the BPS as Philippine National Standards (PNS).
The DOE shall also specify the allowable content of additives in all types of fuels and fuel-related products. Such
standards shall be based primarily on threshold levels of health and research studies. On the basis of such
specifications, the DOE shall likewise limit the content or begin that phase-out of additives in all types of fuels and
fuel-related products as it may deem necessary. Other agencies involved in the performance of this function shall be
required to coordinate with the DOE and transfer all documents and information necessary for the implementation of
this provision.
Consistent with the provisions of the preceding paragraphs under this section, it is declared that:
a) not later than eighteen (18) months after the effectivity of this Act, no person shall manufacture, import, sell,
supply, offer for sale, dispense, transport or introduce into commerce unleaded premium gasoline fuel which has an
anti-knock index (AKI) of not less that 87.5 and Reid vapor pressure of not more than 9 psi. Within six (6) months
after the effectivity of this Act, unleaded gasoline fuel shall contain aromatics not to exceed forty-five percent (45%)
by volume and benzene not to exceed four percent (4%) by volume; Provided, that by year 2003, unleaded gasoline
fuel should contain aromatics not to exceed thirty-five percent (35%) by volume and benzene not to exceed two
percent (2%) by volume;
b) not later than eighteen (18) months after the effectivity of this Act, no person shall manufacture, import, sell,
supply, offer for sale, dispense, transport or introduce into commerce automotive diesel fuel which contains a
concentration of sulfur in excess of 0.20% by weight with a cetane number of index of not less than forty-eight
(48): Provided, That by year 2004, content of said sulfur shall be 0.05% by weight; and
c) not later than eighteen (18) months after the effectivity of this Act, no Person shall manufacture, import, sell,
supply, offer for sale, dispense, transport or introduce into commerce industrial diesel fuel which contains a
concentration of sulfur in excess of 0.30% (by weight).
Every two (2) years thereafter or as the need arises, the specifications of unleaded gasoline and of automotive and
industrial diesel fuels shall be reviewed and revised for further improvement in formulation and in accordance with
the provisions of this Act.
The fuels characterized above shall be commercially available. Likewise, the same shall be the reference fuels for
emission and testing procedures to be established in accordance with the provisions of this Act.
Any proposed additive shall not in any way increase emissions of any of the regulated gases which shall include, but
not limited to carbon monoxide, hydrocarbons, and oxides of nitrogen and particulate matter, in order to be
approved and certified by the Department.
Section 27. Regulation of Fuels and Fuel Additives. - The DOE, in coordination with the Department and the BPS,
shall regulate the use of any fuel or fuel additive. No manufacturer, processor or trader of any fuel or additive may
import, sell, offer for sale, or introduce into commerce such fuel for additive unless the same has been registered
with the DOE. Prior to registration, the manufacturer, processor or trader shall provide the DOE with the following
relevant information:
a) Product identity and composition to determine the potential health effects of such fuel additives;
b) Description of the analytical technique that can be used to detect and measure the additive in any fuel;
c) Recommended range of concentration; and
d) Purpose in the use of the fuel and additive.
Section 28. Misfueling. - In order to prevent the disabling of any emission control device by lead contamination, no
person shall introduce or cause or allow the introduction of leaded gasoline into any motor vehicle equipped with a
gasoline tank filler inlet and labeled "unleaded gasoline only". This prohibition shall also apply to any person who
knows or should know that such vehicle is designed solely for the use of unleaded gasoline.
Section 29. Prohibition on Manufacture, Import and Sale of leaded Gasoline and of Engines and/or Components
Requiring Leaded Gasoline. - Effective not later than eighteen (18) months after the enactment of this Act, no
person shall manufacture, import, sell, offer for sale, introduce into commerce, convey or otherwise dispose of, in
any manner, leaded gasoline and engines and components requiring the use of leaded gasoline.
For existing vehicles, the DTI shall formulate standards and procedures that will allow non-conforming engines to
comply with the use of unleaded fuel within five(5) years after the effectivity of this Act.
Article Two
Other Pollutants
Section 30. Ozone-Depleting Substances. - Consistent with the terms and conditions of the Montreal Protocol on
Substances that Deplete the Ozone Layer and other international agreements and protocols to which the Philippines
is a signatory, the Department shall phase out ozone-depleting substances.
Within sixty (60) days after the enactment of this Act, the Department shall publish a list of substances which are
known to cause harmful effects on the stratospheric ozone layer.
Section 31. Greenhouse Gases. - The Philippine Atmospheric, Geophysical and Astronomical Service
Administration (PAGASA) shall regularly monitor meteorological factors affecting environmental conditions
including ozone depletion and greenhouse gases and coordinate with the Department in order to effectively guide air
pollution monitoring and standard-setting activities.
The Department, together with concerned agencies and local government units, shall prepare and fully implement a
national plan consistent with the United Nations Framework Convention on Climate Change and other international
agreements, conventions and protocols on the reduction of greenhouse gas emissions in the country.
Section 32. Persistent Organic Pollutants. - The Department shall, within a period of two (2) years after the
enactment of this Act, establish an inventory list of all sources of Persistent Organic Pollutants (POPs) in the
country. The Department shall develop short-term and long-term national government programs on the reduction
and elimination of POPs such as dioxins and furans. Such programs shall be formulated within a year after the
establishment of the inventory list.
Section 33. Radioactive Emissions. - All projects which will involve the use of atomic and/or nuclear energy, and
will entail release and emission of radioactive substances into the environment, incident to the establishment or
possession of nuclear energy facilities and radioactive materials, handling, transport, production, storage, and use of
radioactive materials, shall be regulated in the interest of public health and welfare by the Philippine
Nuclear Research Institute (PNRI), in coordination with Department and other appropriate government agencies.
Chapter 4
Institutional Mechanism
Section 34. Lead Agency. - The Department, unless otherwise provided herein, shall be the primary government
agency responsible for the implementation and enforcement of this Act. To be more effective in this regard, The
Department's Environmental Management Bureau (EMB) shall be converted from a staff bureau to a line bureau for
a period of no more than two (2) years, unless a separate, comprehensive environmental management agency is
created.
Section 35. Linkage Mechanism. - The Department shall consult, participate, cooperate and enter into agreement
with other government agencies, or with affected non-governmental (NGOs) or people's organizations (POs),or
private enterprises in the furtherance of the objectives of this Act.
Section 36. Role of Local Government Units. - Local Government Units (LGUs) shall share the responsibility in the
management and maintenance of air quality within their territorial jurisdiction. Consistent with Sections 7, 8 and 9
of this Act, LGUs shall implement air quality standards set by the Board in areas within their jurisdiction; Provided,
however, That in case where the board has not been duly constituted and has not promulgated its standards, the
standards set forth in this Act shall apply.
The Department shall provide the LGUs with technical assistance, trainings and a continuing capability-building
program to prepare them to undertake full administration of the air quality management and regulation within their
territorial jurisdiction.
Section 37. Environmental and Natural Resources Office. - There may be established an Environment and Natural
Resources Office in every province, city, or municipality which shall be headed by the environment and natural
resources officer and shall be appointed by the Chief Executive of every province, city or municipality in
accordance with the provisions of Section 484 of Republic Act No. 7160. Its powers and duties, among others, are:
a) To prepare comprehensive air quality management programs, plans and strategies within the limits set forth in
Republic act. No. 7160 and this Act which shall be implemented within its territorial jurisdiction upon the approval
of the sanggunian;
b) To provide technical assistance and support to the governor or mayor, as the case may be, in carrying out
measures to ensure the delivery of basic services and the provision of adequate facilities relative to air quality;
c) To take the lead in all efforts concerning air quality protection and rehabilitation;
d) To recommend to the Board air quality standards which shall not exceed the maximum permissible standards set
by rational laws;
e) To coordinate with other government agencies and non-governmental organizations in the implementation of
measures to prevent and control air pollution; and
f) Exercise such other powers and perform such duties and functions as may be prescribed by law or
ordinance: Provided, however, That in provinces/cities/municipalities where there are no environment and natural
resources officers, the local executive concerned may designate any of his official and/or chief of office preferably
the provincial, city or municipal agriculturist, or any of his employee: Provided, Finally, That in case an employee is
designated as such, he must have sufficient experience in environmental and natural resources management,
conservation and utilization.
Section 38. Record-keeping, Inspection, Monitoring and Entry by the Department. - The Department or its duly
accredited entity shall, after proper consultation and notice, require any person who owns or operates any emissions
source or who is subject to any requirement of this Act to:
(a) establish and maintain relevant records;
(b) make relevant reports;
(c) install, use and maintain monitoring equipment or methods;
(d) sample emission, in accordance with the methods, locations, intervals and manner prescribed by the Department;
(e) keep records on control equipment parameters, production variables or other indirect data when direct
monitoring of emissions is impractical; and
(f) provide such other information as the Department may reasonably require.
Pursuant to this Act, the Department, through its authorized representatives, shall have the right of:
(a) entry or access to any premises including documents and relevant materials as referred to in the herein preceding
paragraph;
(b) inspect any pollution or waste source, control device, monitoring equipment or method required; and
(c) test any emission.
Any record, report or information obtained under this section shall be made available to the public, except upon a
satisfactory showing to the Department by the entity concerned that the record, report or information, or parts
thereof, if made public, would divulge secret methods or processes entitled to protection as intellectual property.
Such record, report or information shall likewise be incorporated in the Department's industrial rating system.
Section 39. Public Education and Information Campaign. - A continuing air quality information and education
campaign shall promoted by the Department, the Department of Education, Culture and Sports (DECS), the
Department of the Interior and Local Government (DILG), the Department of Agriculture (DA) and the Philippine
Information Agency (PIA). Consistent with Sec. 7 of this Act, such campaign shall encourage the participation of
other government agencies and the private sector including NGOs, POs, the academe, environmental groups and
other private entities in a multi-sectoral information campaign.
Chapter 5
Actions
Section 40. Administrative Action. - Without prejudice to the right of any affected person to file an administrative
action, the Department shall, on its own instance or upon verified complaint by any person, institute administrative
proceedings against any person who violates:
(a) Standards or limitation provided under this Act; or
(b) Any order, rule or regulation issued by the Department with respect to such standard or limitation.
Section 41. Citizen Suits. - For purposes of enforcing the provisions of this Act or its implementing rules and
regulations, any citizen may file an appropriate civil, criminal or administrative action in the proper courts against:
(a) Any person who violates or fails to comply with the provisions of this Act or its implementing rules and
regulations; or
(b) The Department or other implementing agencies with respect to orders, rules and regulations issued inconsistent
with this Act; and/or
(c) Any public officer who willfully or grossly neglects the performance of an act specifically enjoined as a duty by
this Act or its implementing rules and regulations; or abuses his authority in the performance of his duty; or, in any
manner, improperly performs his duties under this Act or its implementing rules and regulations: Provided, however,
That no suit can be filed until thirty-day (30) notice has been taken thereon.
The court shall exempt such action from the payment of filing fees, except fees for actions not capable of pecuniary
estimations, and shall likewise, upon prima facie showing of the non-enforcement or violation complained of,
exempt the plaintiff from the filing of an injunction bond for the issuance of a preliminary injunction.
Within thirty (30) days, the court shall make a determination if the compliant herein is malicious and/or baseless and
shall accordingly dismiss the action and award attorney's fees and damages.
Section 42. Independence of Action. - The filing of an administrative suit against such person/entity does not
preclude the right of any other person to file any criminal or civil action. Such civil action shall proceed
independently.
Section 43. Suits and Strategic Legal Actions Against Public Participation and the Enforcement of This Act.-
Where a suit is brought against a person who filed an action as provided in Sec. 41 of this Act, or against any
person, institution or government agency that implements this Act, it shall be the duty of the investigating prosecutor
or the court, as the case may be, to immediately make a determination not exceeding thirty (30) days whether said
legal action has been filed to harass, vex, exert undue pressure or stifle such legal recourses of the person
complaining of or enforcing the provisions of this Act. Upon determination thereof, evidence warranting the same,
the court shall dismiss the case and award attorney's fees and double damages.
This provision shall also apply and benefit public officers who are sued for acts committed in their official capacity,
their being no grave abuse of authority, and done in the course of enforcing this Act.
Section 44. Lien Upon Personal and Immovable Properties of Violators. - Fines and penalties imposed pursuant to
this Act shall be liens upon personal or immovable properties of the violator. Such lien shall, in case of insolvency
of the respondent violator, enjoy preference to laborer's wages under Articles 2241 and 2242 of Republic Act No.
386, otherwise known as the New Civil Code of the Philippines.
Chapter 6
Fines and Penalties
Section 45. Violation of Standards for Stationary Sources. - For actual exceedance of any pollution or air quality
standards under this Act or its rules and regulations, the Department, through the Pollution Adjudication Board
(PAB), shall impose a fine of not more than One hundred thousand pesos (P100,000.00) for every day of violation
against the owner or operator of a stationary source until such time that the standards have been complied with.
For purposes of the application of the fines, the PAB shall prepare a fine rating system to adjust the maximum fine
based on the violator's ability to pay, degree of willfulness, degree of negligence, history of non-compliance and
degree of recalcitrance: Provided, That in case of negligence, the first time offender's ability to pay may likewise be
considered by the Pollution Adjudication Board: Provided, Further, That in the absence of any extenuating or
aggravating circumstances, the amount of fine for negligence shall be equivalent to one-half of the fine for willful
violation.
The fines herein prescribed shall be increased by at least ten percent (10%), every three (3) years to compensate for
inflation and to maintain the deterrent function of such fines.
In addition to the fines, the PAB shall order closure, suspension of development, construction, or operations of the
stationary sources until such time that proper environmental safeguards are put in place: Provided, That an
establishment liable for a third offense shall suffer permanent closure immediately. This paragraph shall be without
prejudice to the immediate issuance of an ex parte order for such closure, suspension of development or
construction, or cessation of operations during the pendency of the case upon prima facie evidence that their is
imminent threat to life, public health, safety or general welfare, or to plant or animal life, or whenever there is an
exceedance of the emission standards set by the Department and/or the Board and/or the appropriate LGU.
Section 46. Violation of Standards for Motor Vehicles. - No motor vehicle shall be registered with the DOTC
unless it meets the emission standards set by the Department as provided in Sec. 21 hereof.
Any vehicle suspected of violation of emission standards through visual signs, such as, but not limited to smoke-
belching, shall be subjected to an emission test by a duly authorized emission testing center. For this purpose, the
DOTC or its authorized testing center shall establish a roadside inspection system. Should it be shown that there was
no violation of emission standards, the vehicle shall be immediately released. Otherwise, a testing result indicating
an exceedance of the emission standards would warrant the continuing custody of the impounded vehicle unless the
appropriate penalties are fully paid, and the license plate is surrendered to the DOTC pending the fulfillment of the
undertaking by the owner/operator of the motor vehicle to make the necessary repairs so as to comply with the
standards. A pass shall herein be issued by the DOTC to authorize the use of the motor vehicle within a specified
period that shall not exceed seven (7) days for the sole purpose of making the necessary repairs on the said vehicle.
The owner/operator of the vehicle shall be required to correct its defects and show proof of compliance to the
appropriate pollution control office before the vehicle can be allowed to be driven on any public or subdivision
roads.
In addition, the driver and operator of the apprehended vehicle shall undergo a seminar on pollution control
management conducted by the DOTC and shall also suffer the following penalties:
a) First Offense - a fine not to exceed Two Thousand Pesos (P2,000.00);
b) Second Offense - a fine not less than Two Thousand Pesos (P2,000.00) and not to exceed Four Thousand Pesos
(P4,000.00); and
c) Third offense - one (1) year suspension of the Motor Vehicle Registration (MVR) and a fine of not less than Four
Thousand Pesos (P4,000.00) and not more than Six thousand pesos (P6,000.00).
Any violation of the provisions of Sec. 21 paragraph (d) with regard to national inspection and maintenance
program, including technicians and facility compliance shall penalized with a fine of not less than Thirty Thousand
Pesos (P30,000.00) or cancellation of license of both the technician and the center, or both, as determined by the
DTI.
All law enforcement officials and deputized agents accredited to conduct vehicle emissions testing and
apprehensions shall undergo a mandatory training on emission standards and regulations. For this purpose, the
Department, together with the DOTC, DTI, DOST, Philippine National Police (PNP) and other concerned agencies
and private entities shall design a training program.
Section 47. Fines and Penalties for Violations of Other Provisions in the Act. - For violations of all other
provisions provided in this Act and of the rules and regulations thereof, a fine of not less than Ten thousand pesos
(P10,000) but not more than One Hundred thousand Pesos (P100,000) or six (6) months to six (6) years
imprisonment or both shall be imposed. If the offender is a juridical person, the president, manager, directors,
trustees, the pollution control officer or the officials directly in charge of the operations shall suffer the penalty
herein provided.
Section 48. Gross Violations. - In case of gross violation of this Act or its implementing rules and regulations, the
PAB shall recommend to the proper government agencies to file the appropriate criminal charges against the
violators. The PAB shall assist the public prosecutor in the litigation of the case. Gross violation shall mean:
(a) three (3) or more specific offenses within a period of one (1) year;
(b) three (3) or more specific offenses with three (3) consecutive years;
(c) blatant disregard of the orders of the PAB, such s but not limited to the breaking of seal, padlocks and other
similar devices, or operation despite the existence of an order for closure, discontinuance or cessation of operation;
and
(d) irreparable or grave damage to the environment as a consequence of any violation of the provisions of this Act.
Offenders shall be punished with imprisonment of not less than six (6) years but not more than ten (10) years at the
discretion of the court. If the offender is a juridical person, the president, manager, directors, trustees, the pollution
control officer or the officials directly in charge of the operations shall suffer the penalty herein provided.
Chapter 7
Final Provisions
Section 49. Potential Loss or Shifts of Employment. - The Secretary of Labor is hereby authorized to establish a
compensation, retraining and relocation program to assist workers laid off due to a company's compliance with the
provisions of this Act.
Section 50. Appropriations. - An amount of Seven Hundred Fifty Million Pesos (P750,000,000.00) shall be
appropriated for the initial implementation of this Act, of which, the amount of Three Hundred Million Pesos
(P300,000,000.00) shall be appropriated to the Department; Two Hundred Million Pesos (P200,000,000.00) to the
DTI; One Hundred Fifty Million Pesos (P150,000,000.00) to the DOTC; and One Hundred Million Pesos
(P100,000,000.00) to the DOE.
Thereafter, the amount necessary to effectively carry out the provisions of this Act shall be included in the General
Appropriations Act.
Section 51. Implementing Rules and Regulations. - The Department, in coordination with the Committees on
Environment and Ecology of the Senate and House of Representatives, respectively and other agencies, shall
promulgate the implementing rules and regulations for this Act, within one (1) year after the enactment of this
Act: Provided, That rules and regulations issued by other government agencies and instrumentalities for the
prevention and/or abatement of pollution not inconsistent with this Act shall supplement the rules and regulations
issued by the Department pursuant to the provisions of this Act.
Section 52. Report to Congress. - The Department shall report to Congress, not later than March 30 of every year
following the approval of this Act, the progress of the pollution control efforts and make the necessary
recommendations in areas where there is need for legislative action.
Section 53. Joint Congressional Oversight Committee. - There is hereby created a joint congressional oversight
committee to monitor the implementation of this Act. The committee shall be composed of five (5) senators and five
(5) representatives to be appointed by the Senate President and the Speaker of the House of Representatives,
respectively, the oversight committee shall be co-chaired by a senator and a representative designated by the Senate
President and the Speaker of the House of Representatives, respectively.
The mandate given to the joint congressional oversight committee under this Act shall be without prejudice to the
performance of the duties and functions by the respective existing oversight committees of the Senate and the House
of Representatives.
Section 54. Separability of Provisions. - If any provision of this Act or the application of such provision to any
person or circumstances is declared unconstitutional, the remainder of the Act or the application of such provision to
other person or circumstances shall not be affected by such declaration.
Section 55. Repealing Clause. - Presidential Decree No. 1181 is hereby repealed. Presidential Decrees Nos. 1152,
1586 and Presidential Decree No. 984 are partly modified. All other laws, orders, issuance, rules and regulations
inconsistent herewith are hereby repealed or modified accordingly.
Section 56. Effectivity. - This Act shall take effect fifteen (15) days from the date of its publication in the Official
Gazette or in at least two (2) newspapers of general circulation.
Approved, June 23, 1999.