SErngS,

Republic of the Philippines i @
HOUSE OF REPRESENTATIVES 2 peoeiyen *
es  RecEWen @

L> pe JUL 2013
SIXTEENTH (16™) CONGRESS i
First Regular Session

House Bill No.. 1759

Introduced by Hon. Joseph Gilbert F. Violago

EXPLANATORY NOTE

The Overseas Filipino Workers (OFWs) have time and again been referred to as the
heroes of our generation. This js primarily due to the million and one sacrifices that they have to
endure in the search for social and economic redemption they have failed to achieve at home.

It is but fitting to extend to the OFWs all the assistance that the government can give. This
should include an exclusive credit assistance program as proposed under this measure.

The credit facilities under this bills starts even before the departure of the OFW. One who
has a valid contract as certified by the POEA may avail of a Fifty Thousand Pesos loan from the
OWWA to defray the living expenses of his family during the first few months of his absence as
well as other expenses incurred in his pre-employment. The payment shall be through bank
transactions with simple and easy loan terms.

In view of the foregoing, the approval of this bill is earnestly sought.
bo.
HON. JOSEPH F. VIOLAGO

Representative
24 District, Nueva Ecija


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH (16™) CONGRESS
First Regular Session

House Bill No, __ 1759

Introduced by Hon. Joseph Gilbert F. Violago

AN ACT
ESTABLISHING A CREDIT ASSISTANCE PROGRAM FOR OVERSEAS WORKERS,

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 “Overseas Workers Credit
Assistance Act of 2013”.

SEC. 2. Declaration of Policy. - It is hereby declared a policy of the State to protect the
interest of the overseas workers by providing them access to credit facilities even before their
departure.

SEC. 3. Loans. - An overseas Filipino worker (OFW) with a valid employment contract
processed through a licensed recruitment and manning agency accredited by the Philippine
Overseas Employment Administration (POEA) may avail of a loan of not more than Fifty
Thousand Pesos (P50,000.00) from the Overseas Workers Welfare Administration (OWWA) for
any of the following purposes: (a) to defray the living expenses of one’s family during the first
months of absence; and/or (b) to pay for recruitment expenses including placement fees,
documentation costs and plane tickets: Provided, That any member of the OFW’s family not
otherwise disqualified by law shall be a co-borrower and shall execute the necessary
documentation to that effect: Provided, Further, That the loan shall be granted and released by
OWWA upon proper evaluation and submission of the employment contract and plane ticket,
duly certified to in writing by the recruitment agency or direct hirer as to their authenticity and
properly verified by the POEA.

The loan shall be entered into by and between the overseas worker-borrower and
OWWA, with the next-of-kin as a co-borrower. The loan shall be covered with a loan
redemption insurance from any private insurance provider duly registered with and accredited
by the Insurance Commission, the premium of which shall be paid by the applicant overseas
worker-borrower.

SEC. 4. Accreditation of Banks as Payment Conduits. - The OWWA shall accredit as
many domestic or foreign banking institutions as possible which are duly authorized to do
business in the Philippines in order to serve the loan payment/amortization needs of overseas
workers-borrowers. It shall be the obligation of the overseas worker-borrower to remit the loan
payment/amortization regularly to OWWA through the banking institutions. The OWWA shall
likewise establish, within one (1) year after the effectivity of this Act, an on-line payment system
wherein the overseas worker-borrower may pay the loan amortization through the internet.

SEC. 5. Payment of Loan. - The loan shall be paid in twelve (12) equal monthly
installments at a preferred interest rate not to exceed six percent (6%) per annum.


SEC. 6. Loan Payment Assurance Mechanisms. - Failure to pay the loan and/or any
violation of the terms imposed upon the loan shall be sufficient ground for the POEA and all its
offices, including its deputized /accredited private entities and the Philippine Overseas Labor
Offices (POLOs), to withhold the issuance of the Overseas Employment Certificate (OE) and
any other exit permit/clearance to work abroad to the overseas worker-borrower concerned
unless: (a) he/she agrees to the restructuring of the loan, and thereupon pays the first installment
on the said restructuring, as duly certified by OWWA, and, together with this restructuring,
he/she justifies in writing the cause/reason for his/her failure to pay the balance due in
connection with the loan; or, (b) he/she is able to pay in full, as duly certified by OWWA,
whatever balance is due in connection with the loan.

The certification of the OWWA account officer concerned indicating therein the just
cause/reason for the failure to pay, duly attested to by the said account officer's immediate
supervisor, shall serve as proof of the just cause/reason. This certification and all other
certifications mentioned in this section may be issued electronically, through the internet, with
the electronic signatures of the persons executing and/or attesting to the said certifications and
other authenticating safeguards.

SEC. 7. Loan Verification. - For purposes of faster loan verification and/or
authentication and to facilitate OWWA’s administration of this credit assistance program, the
Balik-Manggagawa Processing Center, Regional Offices and Labor Assistance Centers (LAC) of
the POEA, all Philippine Overseas Labor Offices (POLOS) abroad, all OWWA Offices in the
Philippines and abroad, all other concerned government agencies/offices and all licensed
recruitment and manning agencies deputized/accredited by the POBA to issue OECs and other
exit permits/clearances to work abroad, shall coordinate closely and regularly with OWWA
using all available means of verifiable and properly protected communications including, but not
limited to, at least one (1) dedicated, real-time and interactive website to be maintained and
regularly updated on a twenty-four-hour-a-day, seven-day-a-week (24/7) basis by the OWWA.

SEC. 8. Prohibited Acts and Penalties, - Any government official and/or employee who
issues an Overseas Employment Certificate (OEC) and/or an exit permit/clearance to any
overseas worker-borrower in violation of any provision of this Act shall suffer the penalty of
sixty (60) day suspension without pay for the first offense and dismissal from the service with a
five (6) year disqualification to hold any public office for the second offense.

Any private entity which issues an Overseas Employment Certificate (OEC) and/or an
exit permit/clearance to any overseas worker-borrower in violation of any provision of this Act
shall suffer the penalty of sixty (60) day suspension of its license or accreditation for the first
offense and permanent cancellation of license or accreditation for the second offense.

SEC. 9. Additional Personnel for OWWA. - To ensure the proper implementation of this
Act, OWWA is hereby authorized to hire additional personnel who possess the necessary skills,
qualification and experience in bookkeeping, accounting, information technology, and credit
administration, including but not limited to, the areas of evaluation of loan applications, credit
investigation, verification, authentication, and collection.

SEC. 10. Implementing Rules and Regulations. - The OWWA, in consultation with the
Senate Committee on Labor and Employment and the House Committee on Overseas Workers
Affairs, shall, within sixty (60) days after the effectivity of this Act, issue the necessary rules and
regulations for its effective implementation.

SEC. 11. Appropriations. - The amount needed for the release of loans as mandated
under this Act shall be appropriated out of the Overseas Welfare Trust Fund. The departments,
agencies, bureaus, and offices charged with carrying out the provisions of this act shalll include in


their respective programs the implementation of this act, the funding of which shalll be included
in the Annual General Appropriations Act.

SEC. 12. Repealing Clause. - Any other provisions of law or rules and regulations
inconsistent with the provisions of this Act are hereby repealed, amended or modified
accordingly.

SEC. 13. Separability Clause. - If, for any reason, any section or provision of this Act is
held unconstitutional or invalid, the other sections or provisions hereof shall not be affected
thereby.

SEC. 14. Effectivity. - This Act shall take effect fifteen (15) days after its publication in the
Official Gazette and in at least two (2) newspapers of general circulation.

Approved,