Republic of the Philippines

House of Representatives
Queson City, Metro Manila

Twentieth Congress
First Regular Session

HOUSE BILL NO.__1

Introduced by Representatives Ferdinand Martin G. Romualdez,
Andrew Julian K. Romualdez and Jude A. Acidre

EXPLANATORY NOTE

Dubbed as the “Rice Industry and Consumer Empowerment (RICE) Act”,
this bill seeks to strengthen the regulatory powers of the National Food Authority
to support the rice industry and ensure consumer protection through adequate
supply and stable price of rice, amending for the purpose Republic Act No. 8178,
otherwise known as the “Agricultural Tariffication Act”, as amended.

Presidential Decree (PD) No. 4 established the National Grains Authority,
later renamed the National Food Authority (NFA) under PD 1770, to promote
food security and stabilize the price and supply of rice and other staple grains.
The agency was tasked with supporting farmers and ensuring affordable food for
consumers by maintaining buffer stocks and regulating the grains market.

In its original charter, as amended by PD 1485 and PD 1770, NFA exercised
various regulatory functions such as (i) registration, licensing and supervision of
persons engaged in production, manufacturing and storage of rice, grains or its
by-products; (ii) registration, licensing and supervision of persons engaged in
retail and wholesale business of rice, corn or other grains and its by-products; (iii)
registration, licensing and supervision of warehouses and mills; (iv) inspection of
grains warehouses and storage facilities; (v) ordering the seizure of rice or grains
whenever there is comering, hoarding and to sell the said rice or commodities to
the public to stabilize its supply and price in the market; and (vi) establish rules
and regulations involving the importation and exportation of rice.



However, with the passage of RA 11203, also known as the Rice
Tariffication Law (RTL), key provisions of the NFA’s regulatory authority were
repealed. While the RTL opened the market to rice imports and imposed tariffs
instead of quantitative restrictions, it also significantly reduced the NFA’s role to
buffer stocking for emergencies, removing its proactive influence on market price
and supply stabilization.

These repeal or amendments adversely affected the role of NFA in ensuring
food security and hampered the attainment of the state’s policy of making the
country’s agricultural sector viable, efficient, and globally competitive. The
removal of the regulatory functions of NFA opened avenues for traders to hoard
and/or unilaterally control the price and supply of rice in the market, limiting the
participation of NFA in buffer stocking only to be used during emergency
situation and in times of calamity, and removing the role of NFA in the
stabilization of price and supply in the market.

As a result, two major problems have emerged:

+ For farmers, the NFA’s diminished buying capacity and lack of market
intervention weakened price support for palay. With fewer guaranteed
buyers, many rice farmers were left at the mercy of traders who often
dictated prices well below production costs, discouraging local
production and threatening livelihoods.

For consumers, liberalization without sufficient safeguards led to greater
market volatility. The absence of effective monitoring and regulatory
oversight opened avenues for hoarding, price manipulation, and
profiteering, especially during lean months or supply disruptions —
exposing Filipino households to price shocks.

To address these concerns, RA 12078 amended certain provisions of the RTL
and gave the Department of Agriculture (DA) new regulatory powers which
include declaring a state of food security emergency, regulating grains
warehouses, and gathering rice trade data. While this helped partially restore
government oversight, it remains insufficient in stabilizing the rice market or
supporting farmers on the ground.

Given the persistent price instability, warehouse congestion, and weakened
palay procurement, there is now a compelling need to restore to the NFA some,

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if not all, of its original regulatory and market intervention powers. These include
the ability to:

+ Monitor and intervene in rice trade to deter hoarding and artificial price
manipulation;

+ Regularly release rice stocks to stabilize prices and decongest
warehouses;

+ Use sales revenues to procure local palay at reasonable support prices,
creating a stable market for Filipino farmers and ensuring adequate food
supply for consumers

This reform does not aim to reinstate import restrictions abolished by RTL,
nor does it seek to reverse market liberalization. Rather, it provides a mechanism
for timely, targeted state intervention to protect public welfare, promote
agricultural sustainability, and uphold food security.

The regulatory and market intervention functions of NFA will not only
address the pressing concerns on the recently declared state of food emergency
in the country, but will also curtail the growing number of cases of profiteering,
monopoly of price of rice in the market and hoarding of rice supply. The
provision of regulatory powers to NFA shall not in any way hinder the importation,
exportation and trading of rice but is only intended to empower NFA to intervene
in the market or rice trade to ensure adequacy of supply and stability of prices of
rice and palay.

Hence, this proposed bill.

FER [AND ROMUALDEZ

JUDE AZACIDRE ANDREW JULIAN K. ROMUALDEZ


Maunwone

Republic of the Philippines
Bouse of Representatives
Quezon City, filetro Manila

‘Twentieth Congress
First Regular Session

HOUSE BILL NO. 1

Introduced by Representatives Ferdinand Martin G. Romualdez,
Andrew Julian K. Romualdez and Jude A. Acidre

AN ACT
STRENGTHENING THE REGULATORY POWERS OF THE NATIONAL
FOOD AUTHORITY TO SUPPORT THE RICE INDUSTRY AND
ENSURE CONSUMER PROTECTION THROUGH ADEQUATE SUPPLY
AND STABLE PRICE OF RICE, AMENDING FOR THE PURPOSE
REPUBLIC ACT NO. 8178, OTHERWISE KNOWN AS THE
“AGRICULTURAL TARIFFICATION ACT”, AS AMENDED

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 “Rice Industry
‘and Consumer Empowerment (RICE) Act”.

SEC. 2. Declaration of Policy. - It is hereby declared the policy of the
State to maintain food security and promote rice industry sustainability through
an integrated and responsive regulatory framework. Towards this end, the State
shall enhance the institutional capacity of the National Food Authority to oversee
rice supply and pricing mechanisms, protect consumer welfare, and safeguard the

interests of local rice farmers, consistent with equitable and strategic trade policy.



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SEC. 3. Section 3 of RA 8178, as amended, is hereby further amended to

read as follows:

“SEC. 3. Definition of Terms. - The following definitions
apply to the terms used in this Act:

XxX

(©) “Buffer Stock” refers to the optimal level of rice inventory
for [ffteen-¢45}} AT LEAST NINE (9) days that shall be maintained
to sustain the disaster relief programs of the government during natural
or man-made calamities and to address food security emergency

situations on rice.

XXX.

SEC. 4. Section 5 of RA 8178, as amended, is hereby further amended to

tead as follows:

“SEC. 5. Strengthening the Regulatory Function of the Department
of Agriculture (DA). — The DA, through the National Food Authority
(NFA), is hereby authorized to:

(a) Require the registration and maintain a national database of all grain
warehouses, storage facilities, silos, and controlled-temperature cold

storages;

(b) Conduct regular inspections of grain warehouses and agricultural
facilities to ensure compliance with palay and rice and supply
standards and regulations; [and]

(B-1) ORDER THE SEIZURE, WHENEVER THERE IS
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CORNERING, HOARDING, PROFITEERING ACTIVITIES
AS DEFINED BY EXISTING LAWS OF RICE AND OTHER
GRAINS AND THEIR SUBSTITUTES AND/OR BY-
PRODUCTS THEREOF, INCLUDING THE FACILITIES
USED IN THE SAID CORNERING, HOARDING OR
PROFITEERING ACTIVITIES, OR WHENEVER THERE IS
SCARCITY OF SUPPLY OF RICE IN THE MARKET OR
UNWARRANTED INCREASE IN THE PRICE THEREOF,
ORDER THE SEIZURE OF THE HOARDED COMMODITY
AND ITS PUBLIC SALE IN SUCH QUANTITY AS MAY BE
NEEDED TO STABILIZE THE SUPPLY IN THE AREA OF
SCARCITY AND RESTORE PRICES TO NORMAL
LEVELS; ~

TO ENFORCE THIS’ PROVISION, THE NFA
ADMINISTRATOR, OR THE DULY AUTHORIZED
REPRESENTATIVE, IS AUTHORIZED TO IMPOSE
ADMINISTRATIVE FINES AND PENALTIES; TO
CONDUCT INVESTIGATIONS; TO REQUIRE BY
SUBPOENA OR SUBPOENA DUCES TECUM THE
ATTENDANCE AND TESTIMONY OF WITNESSES, THE
PRODUCTION OF BOOKS, PAPERS, DOCUMENTS,
EXHIBITS, RECORDS, EVIDENCE; TO ADMINISTER
OATH; AND TO EFFECT THE SAID SEIZURES.

(B-2) REGISTER, LICENSE, AND PRESCRIBE AND COLLECT

FEES, CHARGES AND/OR SURCHARGES IN LICENSING

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AND REGULATING THE OPERATIONS OF THE
FOLLOWING:

i. GRAINS WAREHOUSES OR ANY PERSONS ENGAGED

IN STORAGE OF RICE AND OTHER GRAINS AND
THEIR SUBSTITUTES AND/OR BY-PRODUCTS
THEREOF;

ii, PERSONS, NATURAL OR JURIDICAL, ENGAGED OR

INTENDING TO ENGAGE IN THE BUSINESS OF
PROVIDING GOODS AND SERVICES IN SUPPORT OF
THE DIFFERENT ACTIVITIES INVOLVED IN THE
PRODUCTION, PROCESSING, TRANSPORTING,
MARKETING AND TRADING OF RICE, CORN AND
OTHER GRAINS OR THEIR SUBSTITUTES;

iii, PERSONS, NATURAL OR JURIDICAL, ENGAGED OR

INTENDING TO ENGAGE IN THE WHOLESALE
AND/OR RETAIL BUSINESS OF RICE, CORN AND
OTHER GRAINS OR THEIR SUBSTITUTES; AND

iv. PERSONS, NATURAL OR JUDICIAL, ENGAGED IN THE

PROCESSING OR MANUFACTURE OF GOODS WHERE
RICE, CORN OR OTHER GRAINS OR THEIR
SUBSTITUTES ARE USED AS INGREDIENTS IN THE
MANUFACTURE OF STARCH; OIL: AND ANIMAL
FEEDS OR OTHER SIMILAR COMMODITIES AND
THEIR BY-PRODUCTS OR END-PRODUCTS;


(c) Collect and analyze data on rice trade activities in cooperation with
the Philippine Statistics Authority (PSA), the Bureau of Customs
(BOC), the National Food Authority (NFA), and other government
agencies for informed policy and operational decisions.

The DA-BPI shall exercise the aforementioned powers in addition
to its existing powers related to sanitary and phytosanitary and food
safety standards.

Upon the request of the DA-BPI, the local government units
(LGUs), the Philippine National Police, the National Bureau of
Investigation, or other law enforcement agencies shall provide prompt

response and assistance in the implementation of this section.

NFA MAY AUGMENT ITS PERSONNEL OR PLANTILLA
POSITIONS CORRESPONDING TO ITS ADDITIONAL
REGULATORY POWERS AND DISTRIBUTION FUNCTIONS.”

SEC. 5. Section 6 (c) of RA 8178, as amended, is further amended to read

as follows:

“SEC. 6. Powers of the DA on the Rice Price Stabilization and Supply
Regulation.

xx Xx

(c) Import rice when the available supply of locally produced rice is
inadequate TO MAINTAIN A STABLE. SUPPLY AND PRICE
CONDITION. The DA Secretary is authorized to designate the
importing entity within the DA [with-the-exeeption—of the NFA:
Provided, [t]That the designated importing entity shall import THE TYPE

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OF rice TO BE DETERMINED BY THE SECRETARY at the least cost
available among government-to-government options, which _ shall

include direct contracts between the Philippine government and foreign
governments, including instrumentalities and State-owned

enterprises of such foreign governments.

SEC. 6. Section 11 of RA 8178, as amended, is further amended to read

as follows:

"SEC. 11, Maintenance and Disposal Rice Buffer Stock, - The NFA shall,
in accordance with the rules, regulations, and procedures, maintain an
optimal rice buffer stock to be sourced [exelusively} from local farmers,
FARMER COOPERATIVES, AND FARMERS’ ASSOCIATION IN
PALAY FORM: . ‘PROVIDED, THAT IF NEED ARISES,
PROCUREMENT. MAY BE UNDERTAKEN IN MILLED RICE
FORM WITHIN THE PRESCRIBED QUALITY STANDARDS, IN
THE FOLLOWING ORDER OF PREFERENCE, AS FAR AS
PRACTICABLE, FROM: (A) RECIPIENTS OF DA RICE
PROCESSING SYSTEMS; (B) REGISTERED FARMERS
COOPERATIVES; AND (C) LOCAL GOVERNMENT UNIT (LGU)
RICE MILLS.

The NFA shall dispose of its rice buffer stock [one-(}-menth-before-the
aging peried-starts-following-the-first in, first-out method] OBSERVING
GOOD WAREHOUSE AND STOCK MANAGEMENT PRACTICES,
WITH THE EFFORT TO PREVENT THE STOCKS FROM AGING

The aging process begins three (3) months from storage for MILLED rice
and six (6) months from storage for palay FORM.


In [beth} ALL cases[,] [disposal through-sele-shall_be through public
euetion} AND IN ADDITION TO ITS EXISTING MANDATE TO

RELEASE STOCKS IN RESPONSE TO EMERGENCIES AND
CALAMITIES, THE NFA SHALL PROVIDE THE GUIDELINES
ON THE DISPOSITION OF STOCKS THROUGH:

(a)SALE OF RICE TO ACCREDITED NFA RETAILERS AND
THEIR SUBSEQUENT SALE TO THE PUBLIC SHALL BE
GOVERNED BY THE NFA SELLING PRICE BULLETIN;

(b)SALE TO GOVERNMENT AGENCIES OR ENTITIES SUCH AS
THE FOOD TERMINAL, INC. (FTI) AND LGUS, THE PUBLIC
THROUGH KADIWA OUTLETS, FARMERS AND FARMER
COOPERATIVES AND ‘ASSOCIATIONS WHO SOLD THEIR
PALAY TO NFA, AND ACCREDITED NFA RICE RETAILERS;

(c) SALE BY PUBLIC AUCTION; OR

(d) SUCH OTHER MEANS OF DISPOSITION ALLOWED UNDER
OTHER LAWS ENSURING. TRANSPARENCY,
COMPETITIVENESS, ACCOUNTABILITY, AND PUBLIC
MONITORING.

FOR THIS PURPOSE, AND AS AN ESSENTIAL PART OF GOOD
STOCK MANAGEMENT, THE NFA SHALL DISPOSE MAXIMUM
OF ONE-FOURTH OF ITS TOTAL EXISTING BUFFER STOCK
EVERY MONTH UNLESS DIRECTED BY THE NFA COUNCIL TO
DISPOSE A HIGHER VOLUME.”


SEC. 7. New sections to be denominated as Section 11-A and Section 11-
B are hereby inserted after the Section 11 of RA 8178, as amended, to read as

follows:

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"SEC. 11-A. SETTING OF FLOOR PRICE FOR PALAY. - THE DA
SHALL HAVE THE POWER TO INTERVENE IN THE MARKET
TO ENSURE ADEQUACY OF SUPPLY AND STABILITY OF
PRICES OF PALAY. THIS INCLUDES THE AUTHORITY TO
ESTABLISH AND IMPLEMENT MECHANISMS FOR
REASONABLE AND FLEXIBLE FLOOR PRICE OF PALAY, ON
NATIONAL, REGIONAL, AND PROVINCIAL LEVELS AT
WHICH THE RICE TRADERS MAY BUY FROM THE FARMERS,
AND TAKING INTO CONSIDERATION THE FOLLOWING:

i) COST OF PRODUCTION;

ii) PREVAILING MARKET PRICES;

REASONABLE MARGINS FOR FARMERS;
iv) WELFARE OF BOTH FARMERS AND CONSUMERS; AND
vy) OTHER RELEVANT FACTORS AND CONDITIONS.

THE NFA SHALL UTILIZE ITS REINSTATED REGULATORY
FUNCTION TO ACHIEVE THESE OBJECTIVES.”

"SEC. 11-B. PENALTIES. - ANY PERSON WHO VIOLATES THE
FLOOR PRICE POLICY OR ANY RULE OR REGULATION
ISSUED THEREUNDER SHALL BE SUBJECT TO:


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i) REVOCATION OR SUSPENSION OF LICENSE, TRADING
PERMIT, OR ACCREDITATION; AND

ii) A FINE NOT EXCEEDING  P2,000,000.00 OR
IMPRISONMENT OF NOT MORE THAN TWO (2) YEARS,
OR BOTH, AT THE DISCRETION OF THE COURT.

“IF THE OFFENDER IS A CORPORATION OR ASSOCIATION,
THE PENALTY SHALL BE IMPOSED UPON ITS RESPONSIBLE
OFFICERS SUCH AS THE PRESIDENT, GENERAL MANAGER,
OR MANAGING PARTNER.

“IF THE VIOLATOR IS AN ALIEN, SUCH ALIEN SHALL BE
DEPORTED UPON. COMPLETION OF SENTENCE, WITHOUT
FURTHER PROCEEDINGS.

“ANY GOVERNMENT OFFICIAL OR EMPLOYEE FOUND TO
HAVE AIDED, ABETTED, OR CONNIVED IN SUCH VIOLATIONS
SHALL BE PERPETUALLY DISQUALIFIED FROM HOLDING

ANY PUBLIC OFFICE, IN ADDITION TO OTHER APPLICABLE

PENALTIES.”

SEC. 8. Implementing Rules and Regulations. — The Secretary of
Agriculture, in coordination with the National Food Authority, shall promulgate
such rules and regulations as may be necessary to carry out the provisions of this
act, which rules and regulations shall take effect fifteen (15) days following their

publication in at least one newspaper of general circulation.


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SEC. 9. Repealing Clause All laws, decrees, executive issuances, rules
and regulations or portions thereof, which are not consistent with this Act, are

hereby repealed, amended or modified accordingly.

SEC. 10. Separability Clause. - If any portion of the provisions of this Act

is held unconstitutional or invalid, all other provisions not affected shall remain.

SEC. 11. Effectivity. - This Act shall take effect immediately upon

publication in the Official Gazette or in a newspaper of general circulation.

Approved,

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