EIGHTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES
First Regular Session
SENATE 
S. B. NO. 
^ 4 9
: 
.u, .
o( II8-: - •
•19 
JUL 11 
All
RECt V ' - u  L /.
Introduced by SENATOR JOEL VILLANUEVA
AN ACT
PROVIDING FOR THE CREATION OF PHILIPPINE 
EXTRACTIVE INDUSTRIES TRANSPARENCY INITIATIVE AND
FOR OTHER PURPOSES
EXPLANATORY NOTE
The extractive industries have the capacity to contribute to the national 
growth and development, especially in resource-rich countries like the 
Philippines. They have the potential to provide livelihood opportunities, create 
jobs, and channel additional government resources to host communities. The 
gains from the oil, gas, and mineral resources, nevertheless, do not always 
translate to benefits for the general public. 
Across the globe, extractive 
industries are marred with various issues on environmental degradation, fiscal 
misconduct, poverty, and corruption.
In response to these issues, the Extractive Industries Transparency 
Initiative (EITI) was launched to allow for full disclosure of and public access 
to information regarding the extractive industry. The EITI is an internationally 
recognized framework and practice that monitors revenue and public benefit 
from mining and other extractive resources. Composed of representatives 
from the government, 
extractive 
industry players, 
and 
civil society 
organizations, EITI provides a platform for the regular and systematic 
reporting, review, and assessment of information concerning the industry. It 
also strengthens multi-sectoral participation in crafting and implementing 
regulatory policies governing the extractive industry.
In the Philippines, the EITI was established on November 26, 2013 
pursuant to Executive Order No. 147 entitled “Creating the Philippine 
Extractive Industries Transparency Initiative.” 
Since its inception, the


Philippine EITI (PH-EITI) served as an effective platform for public disclosure 
of information on fees, taxes and other payments made by mining companies. 
The later expansion of PH-EITI enabled the coverage of oil and gas 
industries. Furthermore, regular reports published by the PH-EITI also later 
expanded 
to 
include 
publicly 
disclosed 
information 
on 
social 
and 
environmental impact of the extractive industries.
Among the impacts of this initiative, the PH-EITI strengthened the 
capacity of local government units (LGUs) -  as well as other stakeholders 
such as community groups, civil society organizations, and indigenous people 
-  in monitoring the mining activities in their respective areas through regular 
disclosure of the share of LGUs in the revenues from extractive industries. 
Over the years since its inception, PH-EITI data collection and reporting 
provided different stakeholders the instrument and proper platform to 
formulate real governance reforms on the ground.
To ensure the continuation of the reforms introduced and established 
by the said initiative, this bill seeks to institutionalize the creation of the 
Philippine EITI. 
Institutionalizing the PH-EITI will enable the multi-sectoral 
initiative not only to continue its efforts but also pursue other reforms that will 
allow the country to further maximize the benefits from the extractive industry.
The immediate passage of this bill is earnesiiy sought.
SENATOR
EL VILLANUEVA


EIGHTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES
First Regular Session
SENATE
S. B. NO. 3 4 9
•19 
JUL 11 
AH -.32
____^
RECiiiV
Introduced by SENATOR JOEL VILLANUEVA
AN ACT
PROVIDING FOR THE CREATION OF PHILIPPINE EXTRACTIVE 
INDUSTRIES TRANSPARENCY INITIATIVE AND FOR OTHER
PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
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CHAPTER I
GENERAL PROVISIONS
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SECTION 1. Title. -  This Act shall be known as the “Philippine Extractive
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Industries Transparency Initiative Act.”
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SEC. 2. Declaration of Principles. -  All natural resources are owned by
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Filipinos represented by the State. It shall be the responsibility of the State to
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ensure that the present and future generations benefit from these finite
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resources. The State must then establish a mechanism by which the Filipino
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people are fully aware of how proceeds from their finite resources are being
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utilized.
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SEC. 3. Definition of Terms.-
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a) Agreement means a contract between the Government and a
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Contractor, involving financial or technical matters;
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b) Contractor means a qualified person acting alone or in consortium who
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is a party to a mineral agreement or to a financial or technical assistance
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agreement.


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c) Extractive Industries refer to the mining, oil, gas and coal sectors and 
all other sectors that require the extraction of non-renewable natural 
resources for commercial use;
d) Financial or Technical Assistance Agreement (FTAA) means a 
contract involving financial or technical assistance for large-scale 
exploration, development and utilization of mineral resources;
e) Independent Firm refers to an accounting or auditing firm that has no 
existing relationship with either the Government or any of the companies 
that are part of the Philippines-Extractive Industries Transparency 
Initiative (PH-EITI);
f) Mineral 
Production 
Sharing 
Agreement (MPSA) 
means 
an 
agreement where the government grants to ttie contractor the exclusive 
right to conduct mining operations within a contract area and shares in 
the gross output. The contractor provides the financing, technology, 
management and personnel necessary for the implementation of the 
agreement;
g) Multi-stakeholder Group (MSG) shall have the meaning given to it 
under Section 14 of this Act; and
h) State refers to the Republic of the Philippines.
CHAPTER II
ESTABLISHMENT OF THE PHILIPPINE 
EXTRACTIVE INDUSTRIES TRANSPARENCY INITIATITVE
SEC. 4. Creation of PH-EITI. -  There is hereby created the Philippine 
Extractive Industries Trans[jarency Initiative (hereinafter referred to as PH- 
EITI).
SEC. 5. Composition. -  The PH-EITI shall be composed of a broad coalition 
of stakeholders, including representatives from the government, the private 
sector, the indigenous community, and non-governmental organizations. The 
PH-EITI shall be governed by a multi-stakeholder body (hereinafter referred to 
as PH-EITI MSG), which shall be constituted in accordance with the provisions 
of Chapter V of this Act.
CHAPTER III
OBJECTIVES OF THE PH-EITI
SEC. 6. General Objectives. -  The general objective of the PH-EITI is to 
improve governance and management of the natural resources in the country 
and ensure that all of what is due to the Filipino people and the Government on 
account of the exploitation and/or extraction of the country's mineral, oil, gas


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and other natural resources are (a) verifiably paid; (b) duly accounted for; and
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(c) judiciously utilized for the benefits of all Filipinos and on the basis of
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intergenerational equity and sustainability.
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SEC. 7. Specific Objectives. -  The specific objectives of the PH-EITI shall 
include, but not be limited, to the following:
a) Ensure sustained political commitment for the initiative and mobilize 
resources to sustain its activities and goals;
b) Require all companies engaged in the extraction of natural resources to 
participate in such initiative;
c) Promote genuine participation of civil society in the design, 
implementation, evaluation and modification of policies and actions of 
the Government associated with resource governance in the Philippines;
d) Implement and ensure compliance to the standards and policies of the 
global initiative;
e) Ensure that the initiative is effectively integrated in other related 
government reform agenda; and
f) Promote better understanding of the public on the nature of extractive 
industries and ttie benefits of transparent and accountable governance 
of our natural resources.
CHAPTER IV
SCOPE AND FOCUS OF THE PH-EITI
SEC. 8. Applicability. -  This Act shall apply to all extractive industries, 
government agencies at the national and local level in the country. National and 
local governments shall be mandatorily required to participate in reporting 
relevant data pursuant to this Act.
SEC. 9. Scope. -  The scope of the PH-EITI shall include;
a) Revenue 
transparency, 
which 
means 
the 
timely 
disclosure, 
reconciliation or audit and publication of all data of material national and 
local payments and revenues sourced from the extractive activities 
covered by the scope of the PH-EITI;
b) Contract transparency, which means public accessibility of all 
concessions, contracts/licenses, agreements and joint ventures that the 
Government enters into related to the extractive sectors within the scope 
of the PH-EITI including related documents and attachments to the 
contracts; and
c) Accessibility of data, information and reports on the extractive industries, 
whicti means public release of data, documents, and information in a


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format that allows the public to freely use, re-use and redistribute them, 
for any purpose, without restrictions.
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SEC. 10. Sectors Covered. -  For the purpose of ttiis Act, the following sectors 
shall be covered by and within the scope of the PH-EITI; (a) ttie mining sector; 
(b) the oil and gas sector; (c) the coal sector; and (d) such other sectors as the 
multi-stakeholder group may subsequently determine and deem necessary. 
The covered sectors shall submit relevant data, including, but not limited, to the 
cost of their operations, amount minerals sold, which sliall be disaggregated 
per transaction, and include such information as the name of the buyer/s, 
country of destination, among others, and other related costs, which shall also 
be disaggregated.
SEC. 11. Annual Report. -  The PH-EITI shall submit an annual report to the 
President and Congress, in any case not later than April 30 of each year.
The annual report to be prepared, submitted and publislied by the PH-EITI shall 
comply with the international standards of EITI and include additional reporting 
requirements as agreed upon by the PH-EITI MSG.
SEC. 12. Monitoring of Payments. -  The payment and utilization of taxes, 
fees, surcharges, and similar charges made by extractive companies and/or 
contractors shall be closely monitored by the PH-EITI. All fiscal payments and 
mandatory expenditures by contractors shall be disclosed to the PH-EITI MSG 
for the production of the annual EITI report. National and local governments 
shall also submit a report on how the proceeds from the extraction of resources 
were utilized.
CHAPTER V
CREATION OF MULTI-STAKEHOLDER GROUP
SEC. 13. Composition. -  In accordance with the EITI International Standards 
and with due regard to the Philippine context, there shall be created a multi­
stakeholder group (MSG) that will be in charge of PH-EITI.
The PH-EITI MSG shall be headed by a Chairperson to be appointed by the 
President of the Philippines, who must be either: (1) a Cabinet secretary. (2) 
the head of the interagency coordinating council on the extractive sector, or (3) 
a presidential adviser. The functions of the Chairperson shall include convening 
the group and organizing a secretariat.
The PH-EITI MSG shall consist of representatives from the following sectors;
a) Government Representatives. The government representatives shall be 
composed of (1) senior officials from concerned agencies appointed by 
the President of the Philippines, (2) representatives from local 
government units, which shall be the president of the leagues of various 
local government units; and (3) representatives from the Congress, to


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ensure that the findings of the EITI will be used for more effective and 
more responsive policies;
b) Industry Representatives. The industry representatives shall be 
composed of officials from the extractive industries included in the EITI;
c) Civil Society Organizations (CSOs) Representatives. The civil society 
shall independently select their representatives in the EITI; and
d) Indigenous Peoples (IPs) Representatives. Tt>e IP representative shall 
be selected by a caucus of IP organizations affected by mining 
operations.
Provided, That groups representing items (b). (c) and (d) above shall designate 
a permanent and alternate representative to PH-EITI MSG. Each organization, 
upon the decision of its members and through its independent process, can 
replace their representatives in the MSG any time following their own 
governance mechanism.
SEC. 14. Regular Meeting of PH-EITI MSG. -  The PH-EITI MSG shall meet 
once a quarter or as often as necessary.
For urgent matters where decision is needed, necessary information shall be 
circulated through email so that decisions can be made electronically by 
consensus.
Fifty percent (50%) of the members, with at least one representative from the 
government, CSOs, IPs, and business sector shall constitute a quorum for the 
transaction of business of PH-EITI MSG. The MSG, shall, in good faith, make 
decisions by consensus.
SEC. 15. Annual Meeting of PH-EITI MSG Members. -  The members of PH- 
EITI MSG shall hold their annual meeting on the month of April of each year. 
The agenda of the meeting shall include, but not be limited to. the approval of 
the activities, reports, accounts and the activity plan of the PH-EITI, and any 
other acts or matters which may be brought to the attention of the PH-EITI in 
pursuit of its mandate as provided under this Act and relevant regulations.
SEC. 16. Notice of Meetings. -  The Chairperson shall call and preside over 
the meetings. Notices stiall be sent out by the PH-EITI secretariat at least one 
week before the date of the meeting. The secretariat shall handle the 
documentation and preparations of the minutes of the meeting.
SEC. 17. Review of the MSG. -  The composition and number of 
representatives shall be subject to regular review by the MSG. Other agencies 
may form part of the MSG subject to the evolving needs and scope of the EITI 
implementation; Provided, That all sectors should be adequately represented 
in the MSG at all times; Provided further. That the existing PH-EITI created 
under Executive Order No. 147, s. 2013 shall be henceforth constituted under 
the provisions of this Act.


CHAPTER VI
SECRETARIAT OFFICE AND FUNDING
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SEC. 18. PH-EITI Office. -  There is hereby created the PH-EITI Office under 
the Office of the President, to be headed by a National Coordinator selected by 
the PH-EITI MSG.
The staffing pattern, including the duties, qualifications, responsibilities and 
functions, and compensation scheme of the personnel of the PH-EITI Office 
shall be determined by the MSG, upon the recommendation by the National 
Coordinator. For this purpose, the creation of the corresponding plantilla 
positions is hereby authorized.
SEC. 19. Funding. -  The Congress shall allocate adequate funding for the 
implementation of PH-EITI in the General Appropriations Act; Provided, That 
the said amount shall not be less than the amount equivalent to one percent to 
two percent (1% to 2%) of the gross proceeds of the sectors covered by and 
within the scope of the PH-EITI, as defined in Section 10 of this Act.
The PH-EITI Office shall have the authority to receive, disburse, and manage 
financial aid or grants from foreign and domestic entities to be utilized for the 
implementation of the objectives of PH-EITI, subject to the usual accounting 
and auditing rules and regulations of the government.
CHAPTER VII
EXEMPTION FROM CONFIDENTIALITY CLAUSES
SEC. 20. Exemption from Confidentiality Clauses. -  
Confidentiality 
provisions stated under applicable laws, including, but not limited, to the 
provisions of Section 270 of the National Internal Revenue Code, Article 81 of 
the Omnibus Investments Code, among others, shall not be applicable to 
extractive companies insofar as their participation in the PH-EITI process is 
concerned.
CHAPTER VIII 
PENALTIES
SEC. 21. Penalties. -  Failure to participate in PH-EITI shall be a ground for 
suspension of the contractor’s permit to operate and blacklisting for future 
projects. A contractor that, without justifiable cause, unreasonably delays or 
causes the delay of submission of the reporting template within the deadline 
set by 
PH-EITI, 
shall 
be 
imposed 
a fine of One 
Million 
Pesos 
(Phpl ,000,000.00). Sanctions provided under this Act shall be imposed by the


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responsible regulatory agency, as the case may be, pursuant to the concerned
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agency’s internal rules and regulations.
CHAPTER IX
TRANSITORY AND MISCELLANEOUS PROVISIONS
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SEC. 22. Implementing Rules and Regulations. -  Within sixty (60) days from 
the effectivity of this Act, the Secretaries of Finance, Budget and Management. 
Environment and Natural Resources, Interior and Local Government, and 
Energy, in consultation with relevant stakeholders, sliall promulgate the 
necessary rules and regulations for the effective implementation of this Act.
SEC. 23. Separability Clause. -  If any provision of this Act is declared 
unconstitutional or invalid, other parts or provisions hereof not affected thereby 
shall continue to be in full force and effect.
SEC. 24. Repealing Clause. — All laws, decrees, executive orders, rules and 
regulations or parts thereof which are contrary to or inconsistent with this Act 
are hereby repealed, amended or modified accordingly; provided, that nothing 
in this Act shall be construed as a diminution of local autonomy or in derogation 
of ancestral domain rights under the Indigenous Peoples' Right Act of 1997.
SEC. 25. Effectivity. -  This Act shall take effect fifteen (15) days after its 
publication in this Official Gazette or in any two newspapers of general 
circulation.
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Approved,
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