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(0),
Republic of the Philippines F NED

House of Representatives 5
Quezon City, Metro Manila

Twentieth Congress
First Regular Session

HOUSE BILL No. _137

Introduced by Representative Arnan C. Panaligan

EXPLANATORY NOTE

This bill seeks to create the National Steel Development Authority to promote
the development of an integrated iron and steel industry in the country.

The Philippine iron and steel industry remains fragmented and import-
dependent, limiting its ability to support infrastructure, manufacturing, and defense.
To meet the domestic demands without relying on imports, it is necessary to
establish a fully integrated value chain—from mining to finished iron and steel
products—through strategic incentives, infrastructure access, and institutional
coordination. This measure complements Republic Act No. 7103, otherwise known
as the “Jron and Steel Industry Act,” and aligns with the Philippine Development
Plan and the Build Better More program.

Despite having iron ore reserves and a growing domestic market, the
Philippines lacks upstream and midstream steelmaking capacity. Over 70% of steel
demand is met through imports, exposing the country to price volatility, supply
disruptions, and trade imbalances. The absence of integration also weakens job
creation, technology transfer, and industrial competitiveness.

The establishment of a fully integrated steel value chain will promote self-
sufficiency and import substitution, attract large-scale investments in upstream and
midstream segments, and ensure environmental sustainability and inclusive growth.

With an integrated iron and steel value chain in the country, it is expected to
attract $5 to $10 billion in new investments over the next decade and create more
than 50,000 direct and indirect jobs. It also aims to reduce infrastructure costs and
improve the trade balance by increasing the share of domestic steel production to


The key provisions of this measure include the creation of the National Steel
Development Steel Integration Fund, which is intended to finance capital-intensive
upstream investments in the local steel industry. The fund will facilitate the
development, modernization, and expansion of integrated steel production facilities
and related infrastructure. Further, it mandates local content or use of locally
manufactured iron and steel products in government projects and directs concerned
agencies to strengthen the quality standards and anti-smuggling enforcement.

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

KO EERE C. PANALIGAN


CorNauawne

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Republic of the Philippines

House of Representatives
Quezon City, Metro Manila

Twentieth Congress
First Regular Session

37
HOUSE BILL NO.

Introduced by Representative Arnan C. Panaligan

AN ACT
CREATING THE NATIONAL STEEL DEVELOPMENT AUTHORITY
(NSDA), DEFINING ITS POWERS AND FUNCTIONS, AND
APPROPRIATING FUNDS THEREFOR

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

SECTION 1. Short Title. — This Act shall be known as the “Integrated Iron
and Steel Industry Development Act.”

SEC. 2. Declaration of Policy. — It is the policy of the State to promote
inclusive industrialization through the establishment of a fully integrated iron and
steel industry that spans upstream, midstream, and downstream segments. Towards
this end, the State shall provide strategic incentives, infrastructure support, and
institutional coordination to ensure global competitiveness, environmental
sustainability, and national self-sufficiency in steel production.

SEC. 3. Definition of Terms. — As used in this Act:

(a) One-stop shop refers to a single common site or location, or a single

online website or portal designated for the business permit and licensing system of


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the government to receive and process applications, receive payments, and issue
approved licenses, clearances, permits, or authorizations.

(b) Integrated steel industry refers to a value chain that includes iron ore
mining, steelmaking, rolling, coating, and fabrication;

(c) Upstream activities refer to iron ore beneficiation, sintering, blast

furnace or electric arc furnace operations;

(d) Midstream activities refer to hot and cold rolling, galvanizing, tinplating;
and

(e) Downstream activities refer to the production of finished steel products
such as rebars, coils, sheets, and pipes.

SEC. 4. Creation of the National Steel Development Authority (NSDA). —
The National Steel Development Authority (NSDA) is hereby created to serve as
the central policy, planning, and coordinating body for the development of a fully
integrated iron and steel industry in the Philippines. It shall be responsible for
formulating strategies, facilitating investments, and ensuring regulatory coherence
across the upstream, midstream, and downstream segments of the steel value chain.

The NSDA shall operate under the administrative supervision of the
Department of Trade and Industry (DTI).

SEC. 5. Composition. — The NSDA shall be governed by a Board of
Directors composed of the following:

(a) Secretary of Trade and Industry (DTI), as Chairperson;

(b) Secretary of Science and Technology (DOST), as Vice Chairperson;

(c) Secretary of Labor and Employment (DOLE);

(d) Secretary of Environment and Natural Resources (DENR);


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(e) Director General of the National Economic and Development
Authority (NEDA);

(f) President of the Philippine Economic Zone Authority (PEZA);

(g) Two (2) representatives from the steel industry sector, to be
nominated by recognized industry associations and appointed by the President of
the Philippines;

(h) One (1) representative from the labor sector, to be nominated by
accredited labor organizations and appointed by the President of the Philippines;

(i) One (1) representative from the academe, preferably with expertise in
metallurgy, engineering, or industrial policy, to be nominated by the Commission
on Higher Education (CHED) and appointed by the President of the Philippines;
and

(Gj) One (1) representative from the private sector with experience in
investment or infrastructure development, to be appointed by the President of the
Philippines, as members.

The ex-officio members shall serve for the duration of their incumbency and
the non-ex officio members shall serve for a renewable term of three (3) years.

SEC. 6. Duties and Functions. — The NSDA shall exercise the following
duties and functions:

(a) Formulate, implement, and update every three (3) years the National
Steel Integration Roadmap, which must be aligned with the national development
goals;

(b) Coordinate inter-agency efforts to promote integration, including

infrastructure access, resource allocation, and investment facilitation;


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(c) Administer the Steel Integration Incentive Program, in coordination
with the Board of Investments and other Investment Promotion Agencies;

(d) Oversee the Steel Integration Fund, ensuring its strategic use for
capital-intensive projects and technological upgrading;

(ce) Monitor industry performance, maintain a national steel database, and
publish an annual State of the Steel Industry Report;

(f) Promote workforce development and research and development, in
partnership with academic and technical institutions;

(g) Enforce compliance with the national steel standards, in coordination
with the Bureau of Philippine Standards (BPS) and relevant regulatory bodies;

(h) Recommend policy reforms and legislative measures to support the
competitiveness, sustainability, and resilience of the steel industry; and

(j) Perform such other functions as may be necessary to carry out the
provisions of this Act.

SEC. 7. Steel Integration Incentive Program. — To accelerate the
development of an integrated and globally competitive steel industry, the NSDA,
in coordination with the Fiscal Incentives Review Board (FIRB) and the Board of
Investments (BOI), shall implement a Steel Integration Incentive Program.

Under the program, qualified iron and steel enterprises are entitled to fiscal
incentives in accordance with the Corporate Recovery and Tax Incentives for
Enterprises (CREATE) Act and the Strategic Investment Priority Plan (SIPP),
including the following:

(a) Income tax holiday (ITH) for a period of up to seven (7) years,
depending on the location and _—_ industry tier __lassification;

(b) Enhanced deductions for a period of ten (10) years, including:


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(1) 100% additional deduction on power __expenses;

(2) 50% additional deduction on —_ labor _ expenses;

(3) 100% additional deduction on research and development
(R&D) expenses; and

(4) 100% add

nal deduction on training —_ expenses;

(c) Special Corporate Income Tax (SCIT) rate of five percent (5%) for
export enterprises, in lieu of all national and local taxes, for a period of ten (10)
years;

(d) Exemption from customs duties and value-added tax (VAT) on
importation of, and domestic purchases of, capital equipment, raw materials, and
other articles directly and exclusively used in the registered project or activity, for
a period of up to seventeen (17) years from the date of registration, subject to the
conditions set forth in the SIPP.

The NSDA shall, in consultation with the FIRB and BOI, issue the necessary
guidelines to determine eligibility criteria, application procedures, and compliance
monitoring mechanisms for the Program.

SEC. 8. Steel Integration Fund. — A Steel Integration Fund, hereinafter
referred to as the Fund, is hereby established to finance capital-intensive upstream
investments in the domestic steel industry. The Fund shall support the
development, modernization, and expansion of integrated steelmaking facilities

and related infrastructure.

It shall be administered by the NSDA, with an initial appropriation to be
sourced from the General Appropriations Act (GAA). The Fund may be

augmented by grants, donations, and other sources as may be authorized by law.


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The NSDA shall issue guidelines to ensure transparent, performance-based
allocation and effective utilization of the Fund in line with the national industrial
priorities.

SEC. 9. Infrastructure and Resource Access. — The establishment of an
integrated steel industry shall be prioritized in the planning and development of
industrial zones, with strategic access to essential infrastructure, including
seaports, reliable power supply, and adequate water resources.

To support upstream operations, the DENR shall, in coordination with the
Department of Energy (DOE) and other relevant agencies, facilitate responsible
and sustainable access to domestic iron ore reserves and renewable energy sources,
in accordance with applicable environmental and energy laws.

Integrated steel industry located within designated eco-industrial zones are
eligible for additional non-fiscal incentives, such as streamlined permitting
processes through the establishment of one-stop shop, technical assistance on
energy efficiency, and access to green financing programs, as may be provided
under existing laws and DOE-administered initiatives.

SEC. 10. Streamlined Procedure.— For the issuance of permits and
licenses, the concerned national and local governments shall:

(a) Establish a one-stop shop and consolidate all the necessary approvals;

(b) Process all applications within three (3) working days for simple
transactions, seven (7) working days for complex transactions, and twenty (20)
working days for highly technical transactions from the date the complete
application was received; and

(c) Approve and issue the requested permit or license after the lapse of the

period under the preceding paragraph (b).


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The provisions of Republic Act (RA) No. 9845, as amended, otherwise known
as the “Anti-Red Tape Act of 2007,” and its implementing rules and regulations are
applicable in the processing of permits and licenses necessary for establishment
and operation of enterprises in the iron and steel industry.

The DTI and BOI shall assist all applicants engaged in the iron and steel
industry in securing the necessary permits and licenses.

SEC. 11. Local Content and Procurement. — To strengthen domestic
industrial capacity and promote inclusive economic development, all government
infrastructure projects shall require, where available, a minimum of fifty percent
(50%) local steel content in the procurement of iron and steel products and
materials. Government agencies, including government-owned and controlled
corporations (GOCCs), shall give preferential consideration to iron and steel
producers registered with the BOI, in accordance with applicable procurement laws
and regulations. The DTI shall, in coordination with the NSDA and the
Government Procurement Policy Board (GPPB), issue the necessary guidelines to
ensure compliance and effective implementation of this provision.

SEC. 12. Standards and Enforcement. — The BPS of the DTI shall ensure
strict enforcement of Philippine National Standards (PNS) for steel products,
including the conduct of regular market surveillance, plant audits, and certification
compliance checks. Manufacturers and distributors found in violation of quality
standards shall be subject to administrative sanctions, including suspension or
revocation of Philippine Standard (PS) licenses, in accordance with RA 4109,
entitled “An Act to Convert the Division of Standards Under the Bureau of

Commerce into a Bureau of Standards, to Provide for the Standardization and/or


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Inspection of Products and Imports of the Philippines and for Other Purposes”,
and other applicable laws.

The Bureau of Customs (BOC) shall, in coordination with the NSDA and
DTI, implement enhanced anti-smuggling protocols to prevent the entry of
substandard or misdeclared steel imports, including risk-based cargo profiling,
post-clearance audits, and real-time data sharing with relevant agencies. Importers
found guilty of misdeclaration or technical smuggling shall face stiffer penalties,
including forfeiture of goods, fines, and disqualification from future import
privileges, as provided under the Customs Modemization and Tariff Act (CMTA).

SEC. 13. Reporting and Oversight. — The NSDA shall submit to Congress
an Annual State of the Steel Industry Report, detailing the performance,
challenges, and strategic outlook of the domestic steel sector. The report shall
include data on production capacity, investment trends, employment, trade flows,
and policy recommendations.

To promote transparency and stakeholder engagement, the NSDA shall
develop and maintain a publicly accessible digital dashboard that tracks key
industry indicators, including integration milestones, capacity utilization rates,
import dependence, and progress on sustainability and innovation targets. The
dashboard shall be updated quarterly and serve as a real-time monitoring tool for
policymakers, investors, and the public.

SEC. 14. Implementing Rules and Regulations. — Within six (6) months
from the convening of the Board of Directors, the National Steel Development
Authority shall, in coordination with other relevant government agencies,
promulgate the necessary rules and regulations for the effective implementation of

this Act.

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SEC. 15. Repealing Clause. — All laws, executive orders, and regulations
inconsistent with the provisions of this Act are hereby repealed or modified
accordingly.

SEC. 16. Separability Clause. — If any section or provision of this Act is
declared unconstitutional or invalid, the remaining provisions shall continue to be
in fall force and effect.

SEC. 17. Effectivity Clause. — This Act shall take effect fifteen (15) days
after its publication in the Official Gazette or in a newspaper of general circulation.

Approved,

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