Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
Second Regular Session

House Bill No./ 443

Introduced by Representative Christian S. Unabia

EXPLANATORY NOTE

Section 1, Article XII of the 1987 Philippine Constitution provides for the
promotion of the agricultural sector. In pursuing such goals, it further states that all
regions of the country shall be given optimum opportunity to develop.

Mindanao is a home to diverse communities. It is the second largest island in the
Philippines with an estimated population of 25.73 million, representing about a quarter
of the country’s total population. It is regarded as the country’s food basket, with one-
third (1/3) of its land area devoted to agriculture. In fact, Mindanao supplies over 40% of
the country’s food requirements and contributes more than 30% to national food trade.

Interestingly, in one of the publications released by Food and Agriculture
Organization (FAO) of the United Nations, entitled FAO in Mindanao, it states that “The
growth in Mindanao’s gross regional domestic product in recent years has surpassed that of
other regions as well as the national average. In spite of this, its share of the country’s
gross domestic product is only at 14.4 percent on average, which pales in comparison
to Luzon’s contribution of 73 percent. This is mirrored by the wide income and social
disparities between and within the various regions in Mindanao.”

Mindanao’s economy continues to be dominated by the agriculture sector and
prospects for agri-industrial development remain high. However, as FAO has aptly put it,
“the challenge lies in harnessing this potential to support Mindanao’s overall
economic development’.

The critical role of agriculture and food supply network in the survival and
sustainability of people’s lives cannot be overemphasized as we have clearly witnessed in
the ongoing Novel Coronavirus (COVID-19) pandemic worldwide. Our local agricultural
producers have been very vital in providing the much-needed food supply that our
country needs.

Further, the current health crisis shows us the need to focus on two core elements
of sustainability: self-sufficiency and resilience not only during the current crisis but
beyond. In fact, FAO has likewise made a warning that unless we take immediate action,
we risk a global food emergency that could have long-term impacts on hundreds of
millions of children and adults. COVID-19 has struck at a time when hunger or
undernourishment keeps rising. According to the latest UN estimates, at a minimum, an
additional 83 million people, and possibly as many as 132 million, may go hungry in 2020
as a result of the economic recession triggered by the pandemic. Moreover, the pandemic

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may plunge national economies into recession, and countries ought to take urgent
measures to mitigate the longer-term impacts on food systems and food security.

To avert a food emergency, there is an urgent need to: protect the most vulnerable,
keep global food supply chains alive, mitigate the pandemic’s impacts across the food
system, protect and even ramp up food production as much as possible, and looking
beyond the pandemic, building back better, more resilient food systems. We must
therefore immediately take action by providing additional support to our local
agricultural producers and institutionalizing a mechanism that is intended to increase
long-term food security and resilience.

Towards this aim, and to ensure inclusive growth consistent with the earlier-
referred mandate of our Constitution, this Bill, which is a product of series of
consultations with key stakeholders, proposes the establishment of Food Supply and
Distribution Centers (FSDC) in every province of Mindanao. It must be emphasized
that the FSDC, as envisioned in this proposed measure, is not a mere “bagsakan” or a
“wholesale market” but an institutionalized mechanism that shall serve as an agricultural
convergence platform among the different stakeholders in the agricultural value chain.

FSDC aims to promote sustainable agricultural development as a key component
both in attaining inclusive economic growth for uplifting the lives of our people, and
achieving long-term food security that shall ensure access to nutritious, good quality,
affordable food products, especially among the low-income consumers in the different
localities of our country, within and outside of Mindanao. It also seeks, among others, to
empower and enable local agricultural producers in Mindanao to reach the other parts of
our country, or even export food commodities abroad, without the additional burden
slapped on them by middlemen and traders of agricultural food commodities.

In view of the foregoing, the immediate passage of this bill is earnestly sought.

Misamis Oriental

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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
Second Regular Session

House Bill No. 1443

Introduced by Introduced by Representative Christian S. Unabia

AN ACT
PROMOTING SUSTAINABLE AGRICULTURAL DEVELOPMENT, STRENGTHENING
FOOD SECURITY THROUGH ESTABLISHMENT OF FOOD SUPPLY AND
DISTRIBUTION CENTER IN EVERY PROVINCE OF MINDANAO, APPROPRIATING
FUNDS THEREFOR AND FOR OTHER PURPOSES.

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:

SECTION 1. Title - This Act shall be known as the “MINDANAO FOOD SUPPLY AND
DISTRIBUTION CENTER ACT OF 2020.”

SECTION 2. Declaration of Policy - The State shall promote sustainable
agricultural development as a key component both in attaining inclusive economic
growth for uplifting the lives of our people, and achieving long-term food security that
shall ensure access to nutritious, good quality, and affordable food products, especially
among the low-income consumers in the different localities all over the country.

This shall include, among others, the establishment of Food Supply and
Distribution Centers, which shall allow equitable marketing opportunities for farmers,
capacitate them on the new technologies involve in agri-business, create food processing
centers for their produce and adopt a more comprehensive platform where stakeholders
in the agricultural value chain responsibly converge and foster inclusive growth and
economic progress, particularly within the rural communities.

SECTION 3. Establishment of Food Supply and Distribution Center (FSDC) in
Every Province of Mindanao - A Food Supply and Distribution Center (FSDC) shall be
established in every province of Mindanao.

FSDCis an institutional mechanism that shall serve as an agricultural convergence
platform established through public investment of central and local governments, with
active and strategic partnership with the private sector. It shall include complex
combinations of activities, functions and relations within the agricultural value chain (e.g.
production, handling, storage, transport, process, package, wholesale, retail, etc. of
agricultural, fisheries and livestock products) enabling cities and municipalities to
sufficiently meet their food requirements, as well as provide stable supply to densely
populated areas where the demand for food necessities is significantly high.

In implementing its programs, FSDC shall give preferential priority to organized
small-scale farmers, fisherfolks and livestock producers.

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SECTION 4. Classification of the FSDCs established under this Act - The FSDCs
established under this Act are herein classified as “Government Instrumentalities with
Corporate Powers (GICP)", which is defined in Republic Act No. 10149, otherwise known
as the “GOCC Governance Act of 2011,” as instrumentalities or agencies of the
government, which are neither corporations nor agencies integrated within the
departmental framework, but vested by law with special functions or jurisdiction,
endowed with some if not all corporate powers, administering special funds, and enjoying
operational autonomy usually through a charter.

SECTION 5. Programs and Activities Within the FSDC - The programs and
activities within the Food Supply and Distribution Center (FSDC), shall include, but are
not limited to the following:

a) Conduct of capacity building on enterprise development and agribusiness that
will allow farmers, fisherfolk, livestock producers and local government units
to maximize potential market opportunities;

b) Introduction of various productivity enhancing technologies to improve
household incomes and promote sustainable agricultural practices. This may
include training and technical assistance on improved cropping, diversified
farming systems and climate-smart agriculture practices through farmer field
schools, fishery and livestock technologies for both farmers and growers, as
well as agriculture extension workers and technicians;

c) Training for targeted beneficiaries, particularly women, youth and members of
the indigenous people's community on identified micro agri-based enterprises
such as food processing, cottage industry and farming/fishing skills that are
market-driven;

d) Construction/rehabilitation and operation of the necessary agricultural
infrastructures such as food and agro-processing facilities, wholesale markets
and trading centers, communal post-harvest facilities, storage, solar dryers,
slaughter houses etc. to increase the agricultural sector's productivity. Provide,
that, the rehabilitation and modernization of existing facilities shall be
prioritized. Provided, further, that as far as practicable and feasible, new
facilities shall be built near the production areas to reduce transportation cost;

e) Creation of food terminal markets and undertaking market linkaging/matching
activities with potential buyers, trade fairs and market missions;

f) Improvement of access to crop insurance and access to low-interest
credit/loan facilities for operational capital and agricultural investments,
especially among organized small-scale farmers, fisherfolks and livestock
producers;

g) Implementation of safety & quality management through inspection of food
safety, standardization of products, improving garding and packaging to keep
food products fresh;

h) Installation of logistic center and transparent marketing system that are geared
towards improving access by households, especially low-income earners, to
stable supplies of good quality, nutritious and affordable food through efficient,
hygienic, healthy and environmentally sound food supply and distribution
systems;

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88 i) Promotion of innovative measures on disaster risk reduction and climate

89 change adaptation that will increase the resilience of agricultural livelihoods;
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91 j) Integration within the local government units an effective and evidence-based
92 planning through the establishment of information, early warning systems and
93 disaster preparedness and response related to food and nutrition security; and
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95 k) Contribution towards increased employment and income opportunities in the
96 agricultural food sector.
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98 SECTION 6. Creation of the FSDC Board - Each Food Supply and Distribution
99 Center (FSDC) shall have a Board composed of the following:
100
101 a) Representatives of relevant government agencies:
102 i. Department of Agriculture, and its concerned bureaus such as the
103 Bureau of Fisheries and Aquatic Resources, Bureau of Animal
104 Industry, Bureau of Plant Industry and Agricultural Training
105 Institute;
106 ii, Department of Trade and Industry;
107 iii, Department of Agrarian Reform;
108 iv. Department of Science and Technology;
109 v. Department of Information and Technology;
110 vi. Department of Local and Interior Government;
peel Department of Transportation;
112 Technical Education and Skills Development Authority;
113 Mindanao Development Authority;
114 x. Cooperative Development Authority and
115 xi. Such other government agencies whose functions are essential to
116 operations of FSDC, as may hereinafter be determined by the Board.
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118 Each indicated government agency shall appoint an official representative, who
119 shall thereafter must be its regular representative to the Board, unless
120 otherwise officially replaced and communicated in writing.
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122 b) Local chief executives of the local government units (LGUs) within the covered
123 province. A local chief executive may designate his/her official representative
124 to the Board, in instances where he/she may not be able to attend the meetings
125 of the Board;
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127 c) Representatives from government corporations, financial and banking
128 institutions primarily assisting the agricultural sector such as Philippine Crop
129 Insurance Corporation, Land Bank of the Philippines, Development Bank of the
130 Philippines, etc.;
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132 d) Representatives from the academe who must have expertise related to
133 agriculture and/or agri-business or any of its integral components. Each
134 university and/or college within the province shall be allowed to have one
135 official representative;
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137 e) Representatives from accredited civil society organizations (CSOs), whose
138 advocacies and/or work are related to agriculture and/or agri-business or any
139 of its integral components (eg. organized small-scale farmers, fisherfolks,
140 livestock producers, and consumer groups, etc.) Each accredited CSO operating
141 within the respective provinces shall have one official representative; and

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f) Representatives from business chambers and/or groups whose line of
business are related to agriculture or any of its integral components.

SECTION 7. Organizational Structure of the FSDC Board - The Department of
Agriculture shall serve as the Chairperson of the FSDC Board, while the Department of
Trade and Industry shall be its Co-Chairperson.

The FSDC Board shall determine all other positions in its organizational structure,
together with their corresponding qualifications. Provided, that, the local chief executives
of the concerned LGUs shall serve as regular members of the FSDC Board.

The Board shall constitute an Executive Committee, hereinafter referred to as the
ExeCom, from among its membership to act, for and on its behalf when the Board is not in
session, on urgent matters as may be deemed necessary by the Chairpersons. In
constituting the ExeCom, the Board must ensure appropriate representation and
participation among its members.

Provided, further, that to ensure that all the FSDCs established under this Act are
well coordinated and properly administered, the Mindanao Development Authority shall
serve as the primary supervising authority for purposes of close coordination of policies
and programs that may hereinafter be approved and adopted by the FSDC Boards.

SECTION 8. Powers and Functions of the FSDC Board - The FSDC Board shall
have the following powers and functions:

a) Develop a comprehensive and unified strategy and policies to ensure that the
purposes of the establishment of Food Supply and Distribution Center (FSDC)
and its programs and activities as enumerated in Section 5 of this Act are
successfully accomplished;

b

Initiate the development of smart agriculture and conduct of pre-feasibility
studies, business planning, policy studies and researches on sustainable
agricultural development, food production and related topics intended to
improve the operations of FSDCs;

c

Undertake meaningful, consultative and participatory dialogues and business
fora between and among the various stakeholders in the agricultural value
chain;

d) Identify, assess, evaluate and select potential micro agri-based enterprises in
strategic areas and study commodities/products with competitive advantage;

e

Form a Project Management Team, which shall be primarily responsible on the
operations of the FSDC;

f) Monitor and closely oversee the undertakings of the Project Management
Team;

Consolidate and integrate all policies, programs, projects, and initiatives that
are supporting and/or connected to FSDC;

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h

Mobilize resources for the programs and projects of FSDCs, including resources
from international funding partners;

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i) Ensure that the resources allocated for FSDC are utilized efficiently and
effectively towards the attainment of its goals as envisioned in this Act;

j) Assess the impact of the implementation of this Act on farmers and other
agricultural workers’ income, their standards of living and stabilization of
consumer prices;

k) Submit annual reports and policy recommendations to Congress on the proper
implementation of this Act, and/or proposals for amendments;

1) Promulgate its own rules of procedures to govern its proceedings, provided
that it shall be in accordance with this Act and its implementing rules and
regulations; and

m) Perform such other functions and duties that are necessary or incidental to the
promotion and development of FSDC.

SECTION 9. Research and Development. - To serve the continuum of the
agricultural industry, each FSDC shall establish its Research and Development
component.

‘The FSDC’s Research and Development component shall have inception from the
State Universities and Colleges in an area coverage basis. This component shall also
include and institutionalize a Data Management and Information Sharing Unit to ensure
that all relevant information, knowledge, technology and best practices that are
significant to the FSDCs are documented and utilized to continuously improve and make
innovations in its processes, as well as contribute in the agricultural industry, in general.

SECTION 10. Training of Women, Youth and Members of the Indigenous
Communities - The Technical Education and Skills Development Authority, the
Department of Agriculture's Agricultural Training Institute and the Department of Science
and Technology shall conduct trainings and provide technical assistance related to
agriculture among women, youth and members of the indigenous peoples to promote
their active participation in FSDCs.

SECTION 11. Information and Education Campaign. - To raise public awareness
and encourage active participation of citizenry in advancing the purposes of this Act, the
FSDC Board and its Project Management Team shall engage the Philippine Information
Agency, through the Public Information Office in each of the covered LGU to undertake
massive information and education campaign.

SECTION 12. Implementing Rules and Regulations - The Department of
Agriculture, as lead agency shall convene the relevant national agencies and other key
public and private stakeholders to craft and formulate the implementing rules and
regulations (IRR) of this Act, within sixty (60) days from the effectivity of this Act.

SECTION 13. Appropriation - For the effective implementation of this Act, the
amount of Five Hundred Million Pesos (PhP 500,000,000.00) is hereby appropriated. The
amount for the initial implementation of this Act shall be charged under the existing
funding of the Department of Agriculture, Department of Trade and Industry and the
Mindanao Development Authority. Thereafter, such amounts necessary for the successive
and continuous implementation of this Act shall be automatically appropriated in the
annual General Appropriations Act.

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SECTION 14. Repealing Clause - All laws, executive orders, rules and regulations,
orders, memoranda or circulars, and other issuances inconsistent with this Act are hereby
revoked, repealed or modified accordingly.

SECTION 15. Separability Clause ~ If, for any reason, any portion or provision of
this Act shall be held unconstitutional or invalid, the remaining portions not affected
thereby shall continue to be in full force and effect.

SECTION 16. Effectivity Clause. 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, whichever comes earlier.

Approved.

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