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17 Nov 2016
SEVENTEENTH CONGRESS
First Regular Session

House Bill No.4454

INTRODUCED BY REPRESENTATIVE ARTHUR C. YAP

EXPLANATORY NOTE

On August 2, 1960, Congress passed Republic Act No. 3018,
otherwise known as “AN ACT LIMITING THE RIGHT TO ENGAGE IN
THE RICE AND CORN INDUSTRY TO CITIZENS OF THE
PHILIPPINES, AND FOR OTHER PURPOSES”. The Rice and Corn
Nationalization Law absolutely prohibited non-Filipinos from engaging
in the rice and/or corn industry, which the law defined as “the culture,
milling, warehousing, transporting, exportation, importation, handling
the distribution, either in wholesale or retail, the provisions of
Republic Act Numbered Eleven hundred and eighty to contrary
notwithstanding , or the acquisition for the purpose of trade of rice
(husked or unhusked) or corn and the by-products thereof.” The
purpose of the law was to transfer the rice and corn industry to
Filipinos and Filipino-owned entities and, as shown in the explanatory
note to the original bill, to do away with the possibility and practice of
aliens creating artificial shortages of rice and corn by hoarding these
commodities, or cornering the market therefor, so as to enable them
to dictate prices thereof.

Thirteen (13) years later, R.A. No. 3018 had succeeded in
transferring the rice and corn industry in all its aspects to Filipinos
and Filipino-owned entities. How, said law, in restraining competition
and foreign investment, created artificial restraints in the national
effort to develop the rice and corn industry. To lift the prohibitions
especially in cases where grains, including rice and corn and/or by-
products thereof, are used for direct consumption or as raw materials
and to encourage foreign investments on a large scale to develop
virgin lands for rice and corn, Presidential Decree No. 194, was
issued to liberalize the rice and/or corn industry. While the aim of the
Decree were laudable, Section 5 thereof, which imposes upon
foreign-owned corporations, partnerships, and associations, the
eventual divestment of 60% of its foreign equity participation to
Filipino citizens provided another unnecessary restraint upon foreign
investment and the foreign investors in manufacturing concerns that
use rice and/or corn as raw materials such as feed mills that provide
countless employment opportunities to Filipinos in the countryside.


This Bill seeks to fulfill P.D. No. 914’s vision of a liberalized rice
and corn industry by repealing the aforementioned divestment
requirement, rationalizing the definition of rice and/or corn industry
and to reiterate the promotion of productive foreign investments in
agriculture as a key to national development.

ATTY.ARTHUR C. YAP.
Representative


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
First Regular Session

House Bill No. 4454

INTRODUCED BY REPRESENTATIVE ARTHUR C. YAP

AN ACT FURTHER LIBERALIZING THE RICE AND
CORN INDUSTRY, REPEALING FOR SUCH PURPOSE
REPUBLIC ACT NO. 3018, OTHERWISE KNOWN AS “AN
ACT LIMITING THE RIGHT TO ENGAGE IN THE RICE
AND CORN INDUSTRY TO CITIZENS OF THE
PHILIPPINES, AND FOR OTHER PURPOSES” AND
AMENDING PRESIDENTIAL DECREE NO. 194
AUTHORIZING ALIENS, AS WELL, AS ASSOCIATIONS,
CORPORATIONS OR PARTNERSHIPS OWNED IN
WHOLE OR IN PART BY FOREIGNERS TO ENGAGE IN
THE RICE AND CORN INDUSTRY, AND FOR OTHER
PURPOSES.

Be it enacted by the Senate and House of Representatives of the Philippines
inCongress assembled.

SECTION 1. Title. — This Act shall be known as the “Rice and/or
Corn Industry Liberalization Act of 2009.”

SECTION 2. Declaration of Policy. — The State recognizes the
importance of attracting, promoting and welcoming productive investments
in the rice and corn industry that will bring down prices for the Filipino
consumer, create more jobs, stimulate economic growth, stabilize food
supply, and enable Philippine goods and services to become globally
competitive. The State, therefore, adopts the policy of removing artificial
restraints upon the effort to develop the rice and corn industry especially in
cases where grains, including rice and corn and/or by-products thereof, are
used for direct consumption or as raw materials in the manufacture or
processing of their finished products.

SECTION 3. An alien, association, partnership or corporation, owned
in whole or in part by foreigners, may engage in the rice and/or corn
industry.

SECTION 4. Definition. — As used in this Act, the term “rice and/or
corn industry” shall include the following activities:


a. Acquiring by barter, purchase, importation, or otherwise, rice and/or
corn and/or the by-products thereof, to the extent of their raw material
requirements when these are used as raw materials in the manufacture
or processing of their finished products.

b. Engaging in the culture, production, milling, processing, trading,
transport, and retailing or rice and/or corn.

SECTION 5. Repealing Clause — Republic Act No. 3018, as
amended, is hereby repealed. Sections 5,7,8, and 9 of Presidential Decree
No. 194 are likewise repealed and all other laws, executive orders, rules
and regulations or parts thereof inconsistent with this Act are repealed or
modified accordingly

SECTION 6, Separability Clause — If any provisions of this Act is
declared invalid, the other provisions not affected thereby shall remain
valid.

SECTION 7. Effectivity. ~ This Act shall take effect fifteen (15) days
after its complete publication in two (2) national newspapers of general

circulation

Approved.