Republic of the Philippines
House of Representatives
Quezon City, Metro Manila

Twentieth Congress
First Regular Session

HOUSE BILL NO. _2998

Introduced by Representative Carlos Andes Loria

EXPLANATORY NOTE

This bill seeks to establish micro, small, and medium enterprises (MSMEs)
and startup innovation hubs in the Second District of Albay and appropriate
funds therefor.

Micro, Small, and Medium Enterprises (MSMEs) are the backbone of the
Philippine economy, accounting for 99.5% of all registered businesses and over
60% of the national workforce according to the Department of Trade and
Industry (DTI). They play a pivotal role in job creation, inclusive growth, and
regional development. However, MSMEs across the country—especially those
outside major urban centers—continue to face significant structural and
operational challenges, including limited access to modern facilities,
technology, capital, mentorship, and markets.

The Legazpi City and the municipalities of Daraga, Camalig, Manito and
Rapu-Rapu in the Second District of Albay are localities with immense
untapped potential in agriculture, food processing, handicrafts, eco-tourism, and
emerging digital sectors. Despite this potential, many local enterprises remain
constrained by fragmented support systems, a lack of centralized innovation
infrastructure, and minimal exposure to national programs that foster
entrepreneurship and startup growth. These limitations prevent them from
scaling, innovating, or accessing wider markets.


This bill aims to institutionalize support for local entrepreneurs through the
establishment of three strategically located innovation hubs in Legazpi City,
Daraga, and Camalig. These hubs, like the Philippine Innovation Hub (iHub),
will facilitate the convergence of government entities to provide all the
necessary assistance to MSMEs and startups and help them overcome obstacles,
expand their enterprises and establish connections with investors, consumers
and partners.

Legazpi City, the provincial capital, serves as the commercial and
administrative heart of the region and offers a resilient, infrastructure-ready
environment for innovation. Camalig, a growing agro-industrial town, is home
to unique cultural products like pinangat and has strong potential for
agribusiness and creative industries. Daraga, a strategic logistics corridor
connecting southem Albay to Legazpi, is ideal for transport services,
warehousing, and tourism-related enterprises. Together, these three localities
form a synergistic triangle for integrated MSME and startup development.

The proposed innovation hubs will provide business incubation services,
shared production facilities, access to funding and technology, continuous skills
training, mentorship, and market development programs. MSMEs and startups
will receive the necessary support, benefits and incentives under existing laws,
including the Startup Venture Fund and Startup Grant Fund. The hubs will also
promote participation in trade fairs, investor pitch events, and export-readiness
initiatives.

The active participation of the Office of the Governor of Albay and local
governments of Legazpi City and municipalities of Daraga and Camalig in
identifying the site location of the hubs, will ensure smooth implementation of
the proposed measure. The LGus are also encouraged to extend financial,
operational, logistical and administrative support for its establishment and
operation, which may be charged against the twenty percent (20%) national tax
allotment of LGUs earmarked for local development projects.

The passage of this bill will address the long-standing gaps in MSME.
support infrastructure and equip local entrepreneurs with the tools, spaces, and
institutional backing they need to grow. By enabling innovation and expanding
access to regional and possibly global markets, the proposed measure will foster
sustainable livelihoods, strengthen the local economy, and help realize a more
inclusive and innovation-driven future for the province of Albay and
neighboring provinces.


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

sought.

CARL ND§S LORIA


Republic of the Philippines
House of Representatives
Quezon City, Metro Manila

Twentieth Congress
First Regular Session

HOUSE BILL NO. _2998

Introduced by Representative Carlos Andes Loria

AN ACT
ESTABLISHING MICRO, SMALL, AND MEDIUM ENTERPRISES
AND STARTUP INNOVATION HUBS IN THE SECOND DISTRICT OF
ALBAY AND APPROPRIATING FUNDS THEREFOR

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

SECTION 1. Short Title. — This Act shall be known as the "Albay
Innovation Hubs Act."

SEC. 2. Declaration of Policy. — In cognizance of the role of micro,
small and medium enterprises (MSMEs) in promoting national development
and economic growth, it is the policy of the State to encourage a culture of
innovation and foster an enabling environment to advance the local
entrepreneurial ecosystem. Towards this end, the State shall, through a whole-
of-government approach, provide an avenue for MSMEs and startups for

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enterprise incubation, startup acceleration, digital transformation, and market
expansion.

SEC. 3. MSMEs and Startup Innovation Hubs. — The Department of
Trade and Industry (DTI) shall, in coordination with the Office of the Governor
of Albay and the concerned local government units (LGUs), establish and
operationalize MSME and Startup Innovation Hubs in Legazpi City and the
municipalities of Daraga and Camalig.

The hubs, which shall be operated by the National Development
Company, must be equipped with all the necessary facilities to implement
programs aligned with the existing MSME Development Plan and Philippine
Startup Development Program, and consistent with the provisions of Republic
Act (RA) No. 11337, otherwise known as the “Innovative Startup Act,” and RA
11293, otherwise known as the “Philippine Innovation Act,”.

SEC. 4. Innovation Hubs Components. ~ Each hub shall include:

a. Incubation spaces and coworking offices with internet, administrative,

and technical assistance support;

b. Shared service facilities for research and development, production,

packaging, and prototyping using the latest technologies;

c. Training and mentoring rooms with digital learning tools for skills

development, capacity building, and legal and business mentoring;


d. Event venues for startup demonstrations, pitch competitions, trade
fairs and market linkages;

e. Satellite offices of DTI, Department of Information and
Communications Technology, Food and Drug Administration, and
other concerned agencies, and LGU’s business one-stop shop as
mandated under RA 9485, otherwise known as the “Ease of Doing
Business and Efficient Government Service Delivery Act of 2018,” as
amended by RA 11032; and

f. MSME and startup help desks for assistance and information.

SEC. 5. Priority Sectors. - The DTI shall, in coordination with the
LGUs, identify the industry sectors in Albay and neighboring provinces in the
Bicol Region that are viable, sustainable, profitable and with growth potential.
The DTI shall prioritize the identified industry sectors and incorporate the same
in the planning and design of the innovation hubs and the delivery of services.

SEC. 6. Benefits and Incentives. — The benefits and incentives provided
under existing laws for MSMEs and startups, including RA 6977, otherwise
known as the “Magna Carta for Micro, Small and Medium Enterprises
(MSMEs),” as amended, RA 11293 and RA 11337, among others, shall be
made available to MSMEs and startups, including the Startup Venture Fund and

Startup Grant Fund.


SEC. 7. LGUs Support. - The City of Legazpi and the municipalities of
Daraga and Camalig shall, in coordination with the Office of the Governor of
Albay, identify the site location, taking into consideration its accessibility and
scalability, for the establishment of the MSMEs and startup innovation hubs.

Likewise, the LGUs, including the provincial government, may include
in their local development plans the establishment and operation of the
innovation hubs, and extend financial, operational, logistical and administrative
support for its establishment and operation.

SEC. 8. Appropriations. — The amount necessary for the establishment of
the hubs shall be charged against the current Contingent Fund. Thereafter, such
sums as may be necessary for the construction of the hubs and its continued
operation, including the granting of funds and loans, shall be appropriated in the
annual General Appropriations Act under the budget of the concerned agencies.

The amount necessary for the establishment operation of the hubs may be
augmented by the concerned LGUs, which shall be charged against the twenty
percent (20%) national tax allotment of LGUs earmarked for local development
projects.

SEC. 9. Implementing Rules and Regulations. — Within sixty (60) days
from effectivity of this Act, the Secretary of Trade and Industry, in coordination
with the Secretaries of Information and Communications Technology and

Science and Technology, General Manager of the National Development


Company, Governor of the Province of Albay and mayors of the concerned
LGUs, shall promulgate the neccessary rules and regulations for the effective
implementation of this Act.

SEC. 10. Separability Clause. — If any provision or part of this Act is
declared unconstitutional, the remaining parts or provisions not affected shall
remain in full force and effect.

SEC. 11. Repealing Clause.— All laws, executive orders, issuances,
rules, and regulations, or parts thereof, inconsistent with the provisions of this
Act are repealed or modified accordingly.

SEC. 12. Effectivity. — This Act shall take effect fifteen (15) days after
its publication in the Official Gazette or in a newspaper of general circulation.

Approved,