FOURTEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES 
) 
Second Regular Session 
8 JIM 30 
1 .?: 
r/ 
Introduced by Senator Loren Legarda 
EXPLANATORY NOTE 
In the year 2007, the Philippines was ranked 47th out of 64 countries in the 
Information Technology (IT) Industry Competitiveness Index in a study conducted by 
the Economist Intelligence Unit. While the same study notes that the Philippines has a 
generally favorable business environment, there were weaknesses and inefficiencies in 
the IT sector that need to be addressed in order to improve its standing. 
Recognizing that the IT industry is a promising industry in the country, efforts 
can be further exerted to boost the country’s competitiveness in the global sector. Such 
efforts include the expansion and rehabilitation of information and communications 
technology infrastructure, promotion of research and development, and most 
importantly, development of human resources. The government should also endeavour 
to empower the poor by affording them ease of access to IT services that are normally 
unaffordable and inaccessible. 
This bill seeks to widen the participation of the poor in the IT sector, particularly 
through entrepreneurial activities. It proposes the creation of an IT venture capital fund 
for small to medium-scale IT start-up companies in order to encourage more Filipinos 
to venture into the very dynamic industry of information technology. The proposed 
fund, which amounts to P1 billion, shall be administered by the Department of Science 
and Technology. 
This measure will assist the entrepreneurs and likewise provide incentives for 
the proliferation of IT-related businesses through-out the country, thereby increasing 
connectivity, particularly in underserved areas. It will allow the IT industry to penetrate 
even the grass roots level, thereby making IT services accessible to the marginalized 
poor. Further, the enactment of this significant piece of legislation is in line with the 
government’s objective to fast-track our country’s econoinic development and its 
competitiveness in the global arena. 
In view of the foregoing, the passage of this bill is earnestly sought. 
a=
LOREN LEGARDA 
Senator 


FOURTEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES 
) 
Second Regular Session 
S.B. No. 
2418 
Introduced by Senator Loren Legarda 
AN ACT 
TO ACCELERATE THE DEVELOPMENT OF INFORMATION TECHNOLOGY 
START-UP COMPANIES BY PROVIDING AN IT VENTURE CAPITAL FUND 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
SECTION 1. Short Title. - This Act shall be known as the "IT Venture Capital 
Fund of 2008." 
SECTION 2. Declaration of Policy - Recognizing the indispensable role of the IT 
sector in driving modern business and enterprise as well as the national economy, it 
shall be the policy of the State to accelerate the development of information technology 
(IT) start-up companies consistent with Sections 9,20 and 24 of Article I1 and Section 12 
of Article XIV of the Constitution. 
SECTION 3. Creation of IT Venture Capital Fund - The amount of one billion 
pesos (Php 1,000,000,0000.00) is hereby appropriated as IT venture capital fund 
(ITVCF), to be administered by the Department of Science and Technology (DOST), to 
cover the initial investment requirement of small technology start-up companies as 
provided for in this Act. Funding for this Act shall come from the special appropriations 
by the Department of Budget and Management (DBM) and from the budget surplus 
which shall be maintained by the DOST. 
SECTION 4. Beneficiaries - The following shall be the beneficiaries of this Act: 
small technology start-up companies engaged in high-value technology e-services and 
products based on a set criteria to be laid down by the DOST for the purpose, such as, 
but not limited to: 
1 


A) Web portals 
B) Real time messaging softwares 
C) E-groups 
D) On-line music and video sharing 
E) Web logging or blogging 
F) Animation 
G) Web design 
H) Video games 
1) On-line gaming 
J) Data warehousing 
SECTION 5. Implementing Rules and Regulations - The DOST shall formulate 
the implementing rules and regulations within sixty (60) days from the effectivity of this 
Act. 
SECTION 6. Separability Clause - If any provision of this Act or portions 
thereof are declared unconstitutional or valid, the other provisions which are not 
affected shall continue to be in full force and effect. 
SECTION 7. Repealing Clause. All laws, executive orders, rules and regulations 
or any part thereof inconsistent herewith are deemed repealed or modified accordingly. 
SECTION 8. Effecfivify. - This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in at least one (1) newspaper of general circulation. 
Approved, 
2