NINETEENTH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE 
s. No. I960
fU- -J tenure
i£>fticp of ti)c ig-. I
23 MAR-6 P5 51 
\n
RL'CEIV.D bv
Introduced by SENATOR RAMON BONG REVILLA, JR.
AN ACT
INSTITUTIONALIZING THE POVERTY REDUCTION THROUGH SOCIAL 
ENTREPRENEURSHIP (PRESENT) PROGRAM AND PROMOTING SOCIAL 
ENTERPRISES, PROVIDING FUNDS THEREFOR AND FOR OTHER PURPOSES
EXPLANATORY NOTE
Section 20, Article II of the 1987 Constitution provides that "The State 
recognizes the indispensable role of the private sector, encourages private enterprise, 
and provides incentives to needed investments."
According to a 2019 report by the Asian Development Bank, there are an 
estimated 164,473 social enterprises (SEs) - roughly 17% of the total registered 
businesses in the country. Almost 7 for every 10 SEs are considered micro-sized 
businesses or employ no more than 50 employees. The same report outlines 
challenges experienced by starting up an SEs, including "lack of resources and access 
to capital, high operating costs, and a challenging regulatory environment."
In a 2015 study, the British Council reported the absence of "social enterprise 
specific legislation in the country." There is a noted gap for social enterprises to be 
able to achieve strategic planning, comply with government legislation, and optimize 
available marketing channels. Despite these challenges, social enterprises have been 
found significantly contributing "to reducing income inequality and increasing self- 
reliance among the poor and marginalized."
The measure aims to establish the Poverty Reduction Through Social 
Entrepreneurship (PRESENT) program by strengthening the existing Micro Small and 
Medium Enterprise Development Council to be more sync to support and capacitate


social enterprises and develop mechanisms to provide quality and accessible social 
services.
The measure proposes that 10% of total government procurement value be 
allocated to social enterprises. It also hopes to develop a continuing program for social 
entrepreneurship in educational institutions and to create a special credit window with 
banks to lend to social enterprises at concessional rates, among others.
In view of enhancing the contribution of the existing social enterprises as 
agents of socio-economic development, the passage of this measure is earnestly 
sought.
RAMODTBONG REVILLA, JR.]A


NINETEENTH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE
s. No. I960
of tup jfepf ptag'
23 nm-6 P5 51
RECElVtD a','.
Introduced by SENATOR RAMON BONG REVILLA, JR.
AN ACT
INSTITUTIONALIZING THE POVERTY REDUCTION THROUGH SOCIAL 
ENTREPRENEURSHIP (PRESENT) PROGRAM AND PROMOTING SOCIAL 
ENTERPRISES, PROVIDING FUNDS THEREFOR AND FOR OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
1 
Section 1. Short Title. - This Act shall be known as the ''Poverty Reduction
2 
Through Social Entrepreneurship (PRESENT) Act."
3 
Sec. 2. Declaration of Policy. - The State shall promote a just and dynamic
4 
social order that will ensure the prosperity and independence of the nation and free
5 
the people from poverty through policies that provide adequate social services,
6 
promote full employment, a rising standard of living, and an improved quality of life
7 
for all. The State recognizes the important role of enterprises in the economy as a
8 
major agent of development.
9 
Towards this end, the State shall pursue an inclusive growth strategy that
10 
promotes a conducive environment to engage the vibrant social enterprise sector in
11 
poverty reduction, and economic and social development. It shall empower the poor
12 
as primary stakeholders in social enterprises, establish mechanisms vital to realizing
13 
their full potential, and extend necessary technical and financial assistance for their
14 
advancement. The State shall enable social enterprises to develop into viable anti-
15 
poverty initiatives.
16 
Sec. 3. Definition of Terms. - The following terms when used in this Act shall
17 
mean:


1 
a. " Basic Sector^ refer to the disadvantaged sectors of Philippine society, namely:
2 
farmer-peasant, artisanal fisherfolk, workers in the formal sector and migrant
3 
workers, workers in the informal sector, indigenous peoples and cultural
4 
communities, women, persons with disabilities, senior citizens, victims of
5 
calamities and disasters, youth and students, children and urban poor;
6 
b. "Economic Subsector^' refer to networks of related actors, and enterprises
7 
performing various functions to value chains that transform raw materials into
8 
finished products, or develop services, and distribute or provide them through
9 
market channels to final consumers. These sub sectors may be identified by
10 
key raw material source, by finished product or final service provided. An
11 
economic subsector may be comprised of several competing value chains;
12 
c. "Marginaiized Sector^' refer to groups of people who are stigmatized or
13 
excluded by virtue of their physical, psychological, economic, social or cultural
14 
circumstances;
15 
d. "Pool1' refers to individuals and families whose income fall below the poverty
16 
threshold as defined by the National Economic and Development Authority
17 
(NEDA) and/or cannot afford in a sustained manner to provide their minimum
18 
basic needs of food, health, education and housing and other essential
19 
amenities of life;
20 
e. "Poverty Reductiorf refers to overcoming the income, resource and capability
21 
deprivation among the poor, basic and marginalized sectors;
22 
f. "Social Enterprisd' or "SE' refers to a social mission-driven organization in the
23 
form of an association, single proprietorship, partnership, corporation,
24 
cooperative, people's organization, non-stock non-profit and people's
25 
organizations or any other legal entity that conducts economic activities
26 
providing goods and/or services directly related to their primary mission of
27 
poverty reduction and improving the well-being of the poor, basic and
28 
marginalized sectors and their living environment, in pursuit of this primary
29 
mission, a SE:
30 
i. Engages and invests in the poor to become effective workers, suppliers,
31 
clients and/or owners;


1 
ii. Ensures that a substantive part of the wealth created by the enterprise
2 
is distributed to or benefits these sectors;
3 
Hi. Reinvests its surplus or profits back to the enterprise to sustain the
4 
fulfillment of its social mission; and
5 
iv. Utilizes its surplus or profits and mobilizes other resources to assist the
6 
poor to become partners in SE or value chain management and
7 
governance and to become partners in community, sectoral and societal
8 
transformation;
9 
g. "Social Enterprise Service Institutiorf' refers to an organization that provides
10 
assistance, including trainings, education and other capacity building measures,
11 
research and development, and other activities, to SEs for them to become
12 
viable and sustainable;
13 
h. " Transactional Service^' refer to enterprise or market-driven activities, such as
14 
providing loans, demonstrating new technologies or conducting training that
15 
are necessary for the poor in the SE system to effectively and efficiently perform
16 
their roles as workers, suppliers, clients and owners. Transactional services may
17 
be fee-based, such as the granting of loans, or non-fee based, such as the
18 
extension of production-related trainings;
19 
i. "Transformative Service^' refer to activities that empower the poor, such as
20 
leadership formation, organizational development, financial and legal literacy,
21 
asset build-up and providing education and experiential learning opportunities,
22 
to become conscious change agents for themselves, for their communities,
23 
sectors and society as a whole;
24 
j. " Value Chain^' refer to value-adding economic activities that firms and workers
25 
do to bring product from its conception to its end use. A value chain typically
26 
consists of:
27 
i. 
raw materials processing;
28 
ii. inbound distribution or logistics;
29 
iii. 
manufacturing operations;
30 
iv. 
outbound distribution or logistics;
31 
V. 
marketing and selling: and
32 
Vi. 
after-sales service.


1 
These activities are supported by
2 
1. purchasing or procurement;
3 
2. research and development;
4 
3. human resource development; and
5 
4. organizational development; and
6 
k. "Living Wagd' refers to the amount of family income needed to provide for the
7 
family's food and non-food expenditures with sufficient allowance for
8 
savings/investments for social security so as to enable the family to live and
9 
maintain a decent standard of human existence beyond mere subsistence level,
10 
taking into account all of the family's physiological, social and other needs.
11 
Sec. 4. Estabiishment of a Poverty Reduction Through Sociai Entrepreneurship
12 
(PRESENT) Program. - There is hereby established a Poverty Reduction Through Social
13 
Entrepreneurship (PRESENT) Program to progressively improve the position and
14 
benefits received by the poor, marginalized and basic sectors of Philippine society from
15 
economic subsector development. To do this, the PRESENT Program shall identify
16 
strategic economic sub sectors with potential for growth, the geographic concentration
17 
of the basic, marginalized and poor sectors, and how these sectors can be tapped to
18 
spur the growth and development of a specific subsector. The PRESENT Program shall
19 
involve identifying and developing key SEs and resource institutions as partners in
20 
providing transactional and transformational services towards poverty reduction. The
21 
formulation of the PRESENT Program shall be guided by the following:
22 
a. Promoting sustainable programs that support the development of inclusive
23 
value chains in key economic sub sectors, with a view to reducing inequality in
24 
incomes and increasing self-reliance among the poor;
25 
b. Enabling SEs to overcome constraints and to take advantage of opportunities
26 
for enhancing the position and benefits of the poor and their living
27 
environments, including those that harness innovative approaches in
28 
addressing social problems;
29 
c. Developing sustainable mechanisms for the provision of quality and accessible
30 
social services to the poor;
31 
d. Empowering people by ensuring the participation of the basic, poor and
32 
marginalized sectors;


1 
e. Promoting gender sensitivity by ensuring women's equal rights and access to
2 
resources of SEs;
3 
f. Promoting ecological soundness in the pursuit of sustainable and equitable
4 
development;
5 
g. Incorporating the PRESENT Program in the government's poverty reduction
6 
drive as a major sustainable and comprehensive strategy; and
7 
h. Rationalizing of poverty reduction programs by streamlining and coordinating
8 
the various anti-poverty programs of the government to reduce inefficiency and
9 
duplication to improve the effectiveness of each program. The planning process
10 
and framework of the PRESENT Program shall ensure that the poor are engaged
11 
as primary stakeholders. It shall add value and complement ecosystem-based,
12 
area-based, community-based and other tools and processes in local economic
13 
development by promoting and utilizing the economic subsector as a strategic
14 
unit of analysis and planning for the development of interventions spearheaded
15 
by SEs. The medium-term and annual development plans of the PRESENT
16 
Program shall be aligned with the medium-term development plan of the
17 
national government.
18 
Sec. 5. National Enterprise Development Council. - The existing Micro, Small
19 
and Medium Enterprise Development (MSMED) Council, which is an attached agency
20 
of the Department of Trade and Industry (DTI), shall be strengthened to effectively
21 
spur the growth and development of MSMEs and SEs throughout the country, and to
22 
carry out the policy under this Act. It shall hereafter be known as the National
23 
Enterprise Development Council or referred as the "Council". In addition to the
24 
existing functions of the Council as provided under Republic Act 9501, otherwise
25 
known as the "Magna Carta for Micro, Small and Medium Enterprise^', the Council
26 
shall serve as the primary agency tasked to carry out the promotion, growth and
27 
development of SEs in the country. It shall also approve the SE development plans as
28 
formulated and recommended by the Center for Social Enterprise Development
29 
(CSED) created under Section 6 of this Act.
30 
Sec. 6. Creation of the Social Enterprise Committee. - Under the Council, a
31 
Social Enterprise Committee shall be established. The SE Committee shall be
32 
composed of the Secretary of DTI, Secretary of National Economic and Development


1 
Authority, Secretary of Interior and Locai Government, the Chairman of the Smali
2 
Business Corporation, and three (3) representatives each from the SEs groups:
3 
Provided, that such representatives shaii each come from the main isiand groupings
4 
of Luzon, Visayas, and Mindanao,
5 
The SE Committee shaii perform the foiiowing mandate:
6 
a. Promote sociai enterprise as a key strategy for reducing poverty and enabiing
7 
inciusive growth;
8 
b. Provide oversight for the impiementation of the PRESENT Program and
9 
activities of the CSED;
10 
c. Estabiish poiicies, pians, programs and projects to deveiop and promote SEs
11 
as a tooi for poverty reduction in accordance with a comprehensive sociai
12 
enterprise deveiopment pian that is fuiiy integrated and consistent with nationai
13 
deveiopment objectives and pians;
14 
d. Monitor and evaiuate the performance of programs and projects of CSED for
15 
appropriate incentives;
16 
e. Submit annuai and other periodic reports to the President and the Congress of
17 
the Phiiippines not iater than Aprii 30 of each year; and
18 
f. Promuigate such ruies and reguiations and exercise such other powers and
19 
functions as may be necessary to carry out the purposes of this Act and for the
20 
continued enhancement, growth and deveiopment of the SE sector.
21 
Sec. 7. Center for Social Enterprise Development - There shaii be estabiished
22 
a Center for Sociai Enterprise Deveiopment (CSED) under the supervision of the SE
23 
Committee to be headed by an Executive Director. The Executive Director shaii have
24 
the primary responsibiiity of impiementing the comprehensive poiicies for sociai
25 
enterprise deveiopment. Specificaiiy, the CSED shaii be responsibie for the foiiowing:
26 
a. The deveiopment and impiementation of the PRESENT Program as approved
27 
by the Councii, with the foiiowing components:
28 
i. Formation and Impiementation of Pians: The CSED shaii formuiate and
29 
impiement sociai entrepreneurship-oriented strategic and economic sub-
30 
sector deveiopment pians that shaii serve as the basis for major poiicies,
31 
projects and activities;


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IV.
Capacity Building and Sustainability: CSED shail work with qualified SE 
service institutions and other intermediaries to design and deliver 
training and education in social entrepreneurship development, 
institutional start-up or strengthening, human resource competency and 
skills training, business planning and advisory services, upgrading of 
accounting and auditing systems, technical assistance for the installation 
or improvement of management information systems, technology 
intervention, technology incubation/commercialization, market studies, 
and product development competitiveness, business matching activities, 
trade fairs and missions, policy advocacy, disaster resiliency and other 
related activities.
Research and Development: The CSED, in coordination with NEDA, 
Department of Science and Technology (DOST), DTI, and other 
appropriate agencies, research institutions, academe, and 
intermediaries, shall develop and enhance a research and development 
system that:
1. Provides recommendations and robust discussions and 
engagements on poverty reduction vis-a-vis SE development in 
key economic subsectors and other inputs for the Council to 
undertake strategic planning for programs and projects;
2. Equips SEs and supports institutions with services and 
technologies that are appropriate for enhancing the participation 
and benefits of the poor in various economic subsectors, and 
innovative and sustainable approaches to improve access of the 
poor to quality basic social services;
Information and Marketing Assistance: The CSED shall promote the 
development and expansion of local and foreign markets for the 
products and services of SEs. Towards this end, the CSED shall:
1. Establish a marketing assistance program that will assist SEs 
match supply with demand in both domestic and foreign markets, 
as well as promote SE products and services through tri-media 
marketing, trade fairs and trade missions; and


1 
2. Develop, install and sustain market information systems for SEs
2 
with the assistance of the DTI and the Department of Tourism
3 
(DOT). All government departments, agencies, bureaus, research
4 
institutions, and local government units (LGUs) shall consolidate
5 
and continuously update on a regular basis and make accessible
6 
all relevant information and data that would be useful to SEs;
7 
b. Establishment and implementation of criteria and process for the qualification
8 
of SEs to be eligible for the support and other incentives provided under this
9 
Act and as approved by the Council;
10 
c. Identification of sources of financing for the SE sector, which shall not be limited
11 
to grants, loans and equity financing for enterprise incubation, start-up and
12 
expansion;
13 
d. Management of multi-stakeholder convergence programs and activities among
14 
government agencies and private organizations in support of the PRESENT
15 
Program;
16 
e. Coordination with the concerned government agencies and LGUs in the
17 
development and implementation of the PRESENT Program and projects;
18 
f. Coordination with social enterprise stakeholders, including people's
19 
organizations, non-government organizations, and multi-sectoral and multi-
20 
disciplinary pool of experts from the academe, practicing professionals,
21 
business, industry, youth, women, and other concerned sectors to provide
22 
advice and technical assistance on matters pertaining to SEs.
23 
Sec. 8. Role of LGUs in SE Development. - LGUs shall be encouraged to
24 
incorporate viable SE development plans in their local development plans, and, as far
25 
as practicable, collaborate with SEs with regard to the implementation thereof.
26 
Sec. 9. Creation of Social Enterprise Development Fund. - There is hereby
27 
created the Social Enterprise Development Fund which shall be used to fund grants to
28 
SEs for the implementation of the PRESENT Program. The CSED, in coordination with
29 
the SE Committee, shall develop the roadmap for the utilization of the Fund, which
30 
shall be approved by the Council.


1 
Sec. 10. Special Credit Windows. - The Land Bank of the Philippines (LBP),
2 
Development Bank of the Philippines (DBP) and other government financial institutions
3 
shall establish special credit windows for the following purposes:
4 
a. Credit line for business development loan or working capital loan to cover the
5 
operational and management expenses of an existing business or income
6 
generating project, including receivable financing or purchase of additional
7 
inventory, soft or intangible investments, such as trade fair participation or
8 
acquisition of software or franchise development packages:
9 
b. Fixed assets financing to cover the acquisition of fixed assets like machineries
10 
and equipment, motor vehicle, or acquisition of lot for project site or
11 
construction of a plant and building and the improvement thereof;
12 
c. Value chain financing to cover any of the value chain activities such as
13 
production, processing and marketing;
14 
d. Domestic letter of credit or trust receipt to provide a stand-by credit facility for
15 
the SE borrower for the purchase of product inputs, equipment, machinery,
16 
implements, and spare parts; and
17 
e. Revolving credit line for re-lending to finance the livelihood project
18 
requirements of the beneficiaries/clients of SEs.
19 
Sec. 11. Compliance with Mandatory Allocation of Credit Resources. - Loans
20 
granted by financial institutions to SEs shall be computed by the Bangko Sentral ng
21 
Pilipinas (BSP) as equivalent to two times the amount of the loan for purposes of
22 
determining the financial institution's compliance to the mandatory allocation of credit
23 
resources to micro, small and medium enterprises as provided under Republic Act
24 
9501, otherwise known as the ''Magna Carta for Micro, Small and Medium Enterprises."
25 
Sec. 12. Preference in Government Procurement - Eligible SEs shall be entitled
26 
to a share of at least ten percent (10%) of total annual procurement value of goods
27 
and services supplied to the Government, its bureaus, offices and agencies. The
28 
Department of Budget and Management (DBM) shall monitor the compliance of
29 
government agencies on the required procurement for SEs and submit its report to
30 
the Council and the Congress of the Philippines no later than May 30 of each year.
31 
Sec. 13. Insurance for Social Enterprises. - The Insurance Commission shall
32 
issue the necessary rules and regulations to implement measures to ensure that the


1 
insurance industry shall provide insurance products, both life and non-life, for social
2 
enterprises and their stakeholders.
3 
Sec. 14. Exemption from the Coverage of the Minimum Wage Law. - SEs, at
4 
least three (3) years from its organization, and have total assets, inclusive of those
5 
arising from ioans but exclusive of the land on which the SB's office, plant and
6 
equipment are situated, is not more than Three Million Pesos (P3,000,000.00) shall be
7 
exempt from the coverage of the Minimum Wage Law; Provided, That all employees
8 
covered under this Act shall be entitled to the same benefits given to any regular
9 
employee such as social security and healthcare benefits.
10 
Sec. 15. Eiigibiiity for Benefits and Incentives. - In the case of social enterprises
11 
organized as stock corporations, partnerships or sole proprietorships, the following
12 
requirements shall apply to become eligible for benefits and incentives provided under
13 
this Act:
14 
a. An SE must not be organized as a branch, subsidiary or division of a private
15 
business enterprise, regardless of the size of such private enterprise, nor may
16 
its policies be determined by a private business enterprise: Provided, that this
17 
shall not preclude an SE from accepting subcontracts from large private
18 
business enterprises or firms or from joining in cooperative or joint venture
19 
activities with other SEs or foundations practicing corporate social
20 
responsibility;
21 
b. At ieast sixty percent (60%) of an SB's total expenditures and profits are plowed
22 
back to the enterprise for the benefit of the poor, and such SE engages in
23 
practices that optimize the benefits for the poor through the provision of iiving
24 
wages, above-market pricing for economically disadvantaged producers and
25 
suppliers, and other best practices that distribute the profit generated by the
26 
enterprise.
27 
Sec. 16. Sociai Entrepreneurship in Education Institutions. - The Council, in
28 
coordination with the Department of Education (DepEd), Technical Education and
29 
Skills Development Authority (TESDA) and the Commission on Higher Education
30 
(CHED), shall mainstream SE in their modules. A continuing social entrepreneurship
31 
education program for out-of-schooi youth and adults shall be developed.
10


1 
Sec. 17. Social Enterprise Week. - In order to promote the importance of SEs
2 
as a viable strategy to address poverty alleviation, the Social Enterprise Week shall be
3 
instituted and coinciding on the week in the month it was passed into law. The Social
4 
Enterprise Week shall be spearheaded by the CSED.
5 
Sec. 18. Appropriations. - The amount necessary for the implementation of this
6 
ACT shall be allocated from the existing MSMED Council Fund. Thereafter, such
7 
appropriation necessary for the continued implementation shall be included in the
8 
budget of the DTI under the annual General Appropriations Act. The CSED may raise
9 
funds from other sources for specific projects as may be authorized by law.
10 
Sec. 18. Harmonization with the Go Negosyo Act. - The implementation of the
11 
provision of this Act shall be harmonized with the provisions of Republic Act 10644
12 
otherwise known as the "Go Negosyo Act."
13 
Sec. 19. Transitory Provision. - Within a period of three (3) years, the Council,
14 
through the SE Committee, shall facilitate the development and dissemination of tools
15 
and invest in the development of the capability of SEs to plan, monitor and evaluate
16 
their social and financial performance. The SE Committee shall evolve socially
17 
acceptable benchmarks for performance evaluation of SEs and incorporate such to
18 
more effectively develop and regulate the sector.
19 
Sec. 20. Implementing Rules and Regulations (IRR). - Within ninety (90) days
20 
from the effectivity of this Act, the DTI, in consultation with the appropriate
21 
government agencies and other relevant stakeholders, shall formulate the IRR to
22 
effectively implement the provisions of this Act.
23 
Sec. 21. Separability Clause. - If any provision of this Act is declared invalid or
24 
unconstitutional, other provisions hereof which are not affected thereby shall remain
25 
in full force and effect.
26 
Sec. 22. Repealing Clause. - All laws, orders, decrees, rules and regulations,
27 
and other parts thereof inconsistent with the provisions of this Act are hereby
28 
repealed, amended or modified accordingly.
29 
Sec. 23. Effectivity. - This Act shall take effect fifteen (15) days after its
30 
publication either in the Official Gazette or in two (2) newspapers of general circulation
31 
in the Philippines.
Approved,
11