Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
3" Regular Session

HOUSE BILL NO." 8788

INTRODUCED BY HONORABLE GAVINI “APOL” PANCHO

EXPLANATORY NOTE

It is the policy of the State to ensure that the people residing and sojourning in the
Republic of the Philippines have access to adequate, quality, and affordable food.

The State also recognizes the contribution of the farmers and farmworkers in the
Philippine economy. Accordingly, it is also the policy of the State to promote the welfare of
the farmers in ensuring that they have government support in technology, research, finance,
production, marketing, and other support services in accordance with Section 5, Article XII
of the 1987 Philippine Constitution.

Recognizing that “RICE” is the staple food of Filipinos, the National Grains
‘Authority (NGA) was created by then President Ferdinand Marcos through the enactment of
Presidential Decree No. 4 in 1972 in order to ensure the adequate production of rice products
in the Philippines.

Thereafter, Presidential Decree No. 1770 “National Food Authority Act” enacted in
1981 renamed the National Grains Authority to what we know today as the National Food
Authority (NFA), widening the NFA’s authority to include the issuance of licenses for the
importation of food products, including rice.

Subsequently, the Philippine government entered into the General Agreement on
Tariffs and Trade (GATT) of 1994 and became officially a member of the World Trade
Organization on January 1, 1995

Despite the elimination of quantitative restrictions under the GATT, the Government
was able to maintain quantitative restrictions in the importation of rice, through the NFA.

As the NFA’s main concer is the adequacy in the supply of rice, and finding that the
prices offered by local farmers for rice grains is considerably higher than what is offered
internationally, the NFA is constrained to purchase the imported rice with lower price.


However, as mentioned in the “MISSION STATEMENT” of the NFA, one of its
primary mission is to ensure reasonable rate of return to Filipino farmers. Thus, the NFA
should also take into consideration the plight of our local farmers and help them in getting a
fair price for their respective products, as a nod to their invaluable contribution to the
Philippine economy.

Accordingly, policies, rules, regulations, and laws must be established to harmonize
the seemingly conflicting mission and mandate of the NFA, in ensuring adequate return to
‘farmers to encourage and assist in improving rice production, while at the same time keeping
an adequate supply of rice in the Philippines.



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS.
3" Regular Session

HOUSE BILL NO., $788

INTRODUCED BY HONORABLE GAVINI “APOL” PANCHO

“AN ACT PROVIDING FOR THE MANDATORY PROCUREMENT OF THE
NATIONAL FOOD AUTHORITY OF ALL PALAY PRODUCED BY THE LOCAL
RICE FARMERS VIA DIRECT PURCHASE.”

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 “AN ACT
MANDATING THE NATIONAL FOOD AUTHORITY TO PROCURE RICE ONLY
FROM THE LOCAL RICE FARMERS VIA DIRECT PURCHASE.”

SECTION 2. Declaration of Policy —It is hereby declared that it is the policy of the
State to:

(a) Promote and ensure the availability of the sufficient supply of quality and
affordable rice in the Philippine Market for the Filipino people; and

(b) Promote the wellbeing of rice farmers, and ensure the availability of
government support in technology, research, finance, production, marketing,
and other support services.

SECTION 3. Definition of Terms. — For purpose of this Act the following terms are
hereby defined as:

(a) Rice ~ shall refer to the unhusked rice grain which is the staple food of
Filipinos, regardless of the quality or variety thereof.

(b) National Food Authority (NFA) ~ is the primary government agency tasked
with the regulation of the importation of rice and corn, and is mandated to
ensure the adequate supply of rice and com in the Philippines.


(c) NFA Rice ~ shall refer to rice bought by the NFA, and sold and/or distributed
to retailers;

(d) Farmers — shall refer to Filipino farmers engaged in the cultivation of rice or
other agricultural product within the Philippine territory as their primary
source of income.

(e) Direct Purchase ~ shall refer to purchase of rice directly from the farmers
without going through any mediator, intermediary, and/or reseller.

(f) Annual Budget — shall refer to the total budget allocated by Congress under a
General Appropriations Act to the NFA.

(g) Price difference the difference between the prices of NFA rice as against the
lowest prevailing price of rice in the market, whether produced locally or
abroad, shall be considered as a subsidy to the farmers and/or the Filipino
consumers.

(h) Subsidized price — the enforced price of NFA Rice bought from local farmers.
The subsidized price shall always be equal or lower than the prevailing market,
price of rice.

SECTION 4. Purchase of rice from farmers. — the NFA shall use its annual
budgetary allocation for rice purchase under the General Appropriations Act (GAA) to
purchase rice directly from farmers, without going through any mediator, intermediary,
and/or reseller to ensure that the farmers shall receive adequate payment for the rice products.

The direct purchase from the farmers is mandatory regardless of the moisture content
and/or quality of rice.

The NFA shall issue a regulation within sixty (60) days from the effectivity of this
law on how to implement “direct purchase” of rice from farmers.

SECTION 5. Subsidized price for NFA Rice. - NFA Rice shall have an enforced
market retail price that is equal or lower than the lowest priced rice, regardless of source, in
the market.

The price difference of rice as compared to the rice imported by the NFA shall be
considered as a subsidy and shall not be passed onto retailers and consumers.

SECTION 6. Monitoring of subsidized price. — the NFA shall take measures to
ensure that any price difference shall not be passed unto the consumers to maintain the
affordability of NFA Rice.


SECTION 7. Separability Clause. If for any reason, any provision of part hereof is
declared invalid, the other provisions not affected thereby shall remain in full force and
effect.

SECTION 8. Repealing Clause. Any provision of the law, presidential decree,
executive orders, rules and regulations contrary to the provision of this Act is hereby
repealed, amended or modified accordingly.

SECTION 9. Effectivity This Act shall take effect fifteen (15) days after its

complete publication in the Official Gazette or in at least two (2) newspapers of general
circulation, whichever comes earlier.

Approved.