Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

f* DECEIVED
03 JUL 201

EIGHTEENTH CONGRESS
First Regular Session

House Bill No,__1242

Introduced by REPRESENTATIVE LUCY TORRES GOMEZ

EXPLANATORY NOTE

The coconut industry in the country has been on the decline for many years now and poverty
is widespread among the families of our coconut farmers and workers. The irony is that there is
actually a gargantuan amount available — up to P 100 billion - which could be used for the immediate
rehabilitation and development of the industry, but which remains untapped due to lack of a
mechanism for the accounting/inventory and utilization of the said amount.

This huge sum of money is what is popularly known as the coco levy fund. The latest
Supreme Court decision on the matter declared that the fund is owned by the government “in trust”
for all the coconut farmers, meaning, it could only be used for the benefit of all the coconut farmers
and for the development of the coconut industry.

This measure follows closely the second (May 2019) version of the bill which, in turn, sought
to avoid the pitfalls of the first version which was vetoed by the President in February 2019. Its
approval would correct a historic injustice committed against our coconut farmers and revive the
moribund coconut industry which actually has immense potentials to contribute to the overall

development of our economy.

HON. Ycy T ‘S GOMEZ
Representative
Fourth District, Province of Leyte

a)


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS

First Regular Session

HOUSE BILL NO. __ 12a

Introduced by REPRESENTATIVE LUCY TORRES GOMEZ

AN ACT
ESTABLISHING THE COCONUT FARMERS AND INDUSTRY DEVELOPME
TRUST FUND AND PROVIDING FOR ITS MANAGEMENT AND UTILIZATION

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 "Coconut Farmers and Industry
Development Trust Fund Act."

Sec. 2. Declaration of Policy. It is hereby declared the policy of the State to pursue
and attain the balanced, equitable, integrated, and sustainable growth and development of
the coconut industry. Towards this end, the State shall adopt the necessary measures to
immediately address the serious problems besetting the coconut industry, protect the
socio-economic well-being of coconut farmers, and ensure that the benefits due them,
especially the poor and the marginalized, under various statutes shall be consolidated
and their delivery expedited. Any measure or program undertaken in accordance to
this Act shall be deemed complementary to and shall not be a replacement for existing
and potential coconut development programs already conducted by other agencies.

Chapter I
Definition of Terms
Sec. 3. Definition of Terms. As used in this Act:
a. Coconut Industry Investment Fund (CIIF) refers to the Fund created pursuant

to Presidential Decree (PD) No. 1468, which authorized the United
Coconut Planters Bank (UCPB) to utilize the surplus funds from the Coconut
Consumers Stabilization Fund (CCSF) and the Coconut Industry Development
Fund (CIDF) for investments in the form of shares of stock in corporations


organized for the purpose of engaging in the establishment and
Operation of industries, commercial activities, and other allied business
undertakings related to the coconut industry in all its aspects and the
establishment of a research program into the commercial and industrial uses
of coconut.

CHF Holding Companies refer to the fourteen (14) holding companies
namely: (1) Anglo Ventures Corporation; (2) ASC Investors. Inc. ; (3) Are
Investors. Incorporated; (4) AP Holdings. Incorporated; (5) Fernandez
Holdings. Incorporated: (6) First Meridian Development. Inc.; (7) Randy
Allied Ventures. Incorporated; (8) Rock Steel Resources. Incorporated; (9)
Roxas Shares. Incorporated; (10) San Miguel Officers Corporation. Incorporated;
(11) Soriano Shares. Incorporated; (12) Te Deum Resources. Incorporated:
(13) Toda Holdings. Incorporated; and (14) Valhalla Properties
Limited, Incorporated. created by the CHF Oil Mills Group to
acquire, hold and manage the shares of stocks of San Miguel
Corporation (SMC).

CIIF Oil Mills Group refers to the six (6) CIIF companies. namely: (1)
Southern Luzon Coconut Oil Mills; (2) Cagayan de Oro Oil Company
Incuiporated: (3) Iligan Coconut Industries. Incorporated: (4) San
Pablo Manufacturing Corporation: (5) Granexport Manufacturing
Corporation: and (6) Legaspi Oil Company. Incorporated, acquired by the
UCPB using the CHF.

CHF SMC Black Shares refer to the thirty-three million one hundred thirty-
three thousand and two hundred sixty-six (3.133.266) shares of stock in SMC.
sequestered by the Presidential Commission on Good Government (PCGG) in
April 1986 representing thirty-one percent (31%) of the total outstanding capital
stock of SMC.

Converted SMC Series I Preferred Shares refer to that portion of the CIF

SMC Block Shares covering seven hundred fifty-three million eight hundred
forty-eight thousand and three hundred twelve (753.848.312) preferted shares
of stock in SMC representing twenty-four percent (24%) of the outstanding
capital stock of SMC.

Coconut Farmer refers to

1. Farmer-owner of a coconut farm who:

a) Tills the land (owner-cultivator); or
b) Does not till the land but has control and supervision over the
cultivation of a farm; and
2. A non-owner of the coconut farm who is either a:
4) Leascholder or tenant who tills or supervises the cultivation of the farm;


or

b) Farm worker or laborer. whether seasonal or itinerant, engaged in the

harvesting of the nuts and processing of copra as major means of
livelihood.

Coconut Levy Assets refer to any and all kinds of property, whether real or

personal, tangible or intangible, wherever situated. which have been acquired
through or otherwise funded by the Coconut Levy Funds. including those assets
that may be recovered in favor of the Government. as well as the fruits or income
derived therefrom. including those acquired in exchange or substitution thereof.

including but not limited to the following:

1. The shares of stock in the UCPB determined to be owned by the
Government;

2. The C11F Oil Mills Group;

3. The C11F Holding Companies;

4. The Converted SMC Series I Preferred Shares; and

5. Remaining CIF SMC Block Shares or the proceeds of their sale.

Coconut Levy Funds refer to various funds generated from levies. taxes.
charges. and other fees exacted or imposed pursuant to or in connection with
the sale of copra rececada or its equivalent in other coconut products. and
collected for the most part from coconut farmers. planters. millers. refiners.
processors. exporters, dessicators. and other end users of copra rececada or
its equivalent in other coconut products. These shall refer to any and all of the
following:

1. The Coconut Investment Fund created under Republic Act (RA) No. 6260;
2. The Coconut Consumer Stabilization Fund. later renamed as the Coconut
Stabilization Fund. created under PD No. 276;

3. The Coconut Industry Development Fund created under PD No. 582;

4. The Coconut Industry Investment Fund created pursuant to PD No. 1468:
and

5. The Coconut Reserve Fund under PD No. 1468 and PD No. 1842.

Investment Guidelines refer to the investment management guidelines. rules.
procedures. and policies to be formulated by the Coconut Farmers and Industry
Trust Fund Committee created under Section | | of this Act. hereinafter referred
to as the Committee, and as may be amended from time to time which shall


provide the parameters for investments of the Trust Fund or any portion thereof.
and shall include, among others. asset allocation. criteria for selection of fund
managers. required income from the fund and other investment management

threshold requirements.

A Trust Income refers to the income, interest earnings and other monetary
benefits realized by and accruing to the Trust Fund or any portion thereof.

k Trust Principal refers to:

1. The initial Trust Principal composed of dividends declared, paid, or issued
on the Converted SMC Series | Preferred shares: the proceeds from the
redemption of the Converted SMC | Preferred Shares; all income or interest
derived therefrom as of the effectivity of this Act; or any other cash Coconut
Levy Asset deposited in the Bureau of the Treasury (BTr) and the UCPB
as administrator of the C11F;

2. Any and all proceeds of privatization of the Coco Levy Assets remitted
thereto by the Privatization and Management Office (PMO) organized under
Article Ill of Executive Order (EO) No. 323 (s. 2001); and

3. Proceeds of privatization of any or all properties or assets conveyed by
any person. group. or entity to the Committee, from time to time. As

provided in Section 8 hereof,

Chapter IT
Audit and Reconveyance of Coconut Levy Assets

Sec, 4, Audit and Inventory of Coconut Levy Assets. Upon the effectivity of this Act, the
PCGG shall conduct a complete accounting and inventory of the Coconut Levy Assets as
well as the investments. disbursement, and expenditures relating to the coconut levy
fund and submit a certified report to the BTr. the Commission on Audit (COA). and the

Office of the President (OP).

The COA shall audit the Report on the Accounting and Inventory of the Coconut Levy
Assets prepared and submitted by the PCGG for the purpose of, among others,
inventory, the existence o+ the subject assets.

determining completeness of said
the asset valuation, and tracing of the flow of the

Establishing the reasonableness of
coconut levy fund.

The COA shall submit to the PCGG its initial audit report, the reviewed Report on the
‘Accounting and Inventory of the Coconut Levy Assets, and the valuation as well as the

methodologies employed for said valuation, together with its observations

empirical basis and
sion of the Report on the

for revision and compliance, within ninety (90) days from submis:


Accounting and Inventory of the Coconut Levy Assets. However, if necessary, further audit
may be undertaken after the initial audit.

The PCGG shall then incorporate the COA's observations for revision and compliance in the
Report on the Accounting and Inventory of the Coconut Levy Assets and submit the revised
version to the COA within thirty (30) days, subject to reasonable time extension, from the
submission of the COA's observations for revision and compliance.

After determining that the observations for revision and compliance were incorporated in the
revised Report on the Accounting and Inventory of the Coconut Levy Assets by the
PCGG, the COA shall submit the final version of the Report on the Accounting and
Inventory of the Coconut Levy Assets to the Committee, as well as the empirical basis
and methodologies employed for the valuation,

The Committee shall publish the same, within fifteen (15) days from its receipt of the final
version of the Report on the Accounting and Inventory of the Coconut Levy Assets, in at least
two (2) newspapers of national circulation.

Sec. 5. Reconveyance of Coconut Levy Assets. Immediately upon the effectivity of this
Act, the PCGG, the government representatives to the boards of sequestered/surrendered
corporations, and any government agency or person in possession, custody, control, or
administering any Coconut Levy Asset shall perform or cause the performance of the
following:

Reconveyance of the title of such asset to the Republic of the Philippines:
b. Delivery of all stock certificates and other evidence of ownership to the BTr
for safekeeping; and
© Deposit all cash assets in the Trust Fund.
Any provision of the law to the contrary notwithstanding, the BTr and the UCPB
shall directly remit the initial Trust Principal to the Trust Fund; Provided. That the BTr
shall transfer the remaining cash assets from the special account in the General Fund within a
period of five (5) years in equal amounts each year.

The COA shall conduct an audit to determine compliance with pertinent laws, rules, and
regulations on reconveyance of the Coconut Levy Assets to the government.

The COA shall also conduct the regular financial and compliance audit of the Coconut Levy
Assets, and submit the annual audit report thereon as mandated by the government auditing
rules and regulations, until said assets are privatized.

Chapter III
Coconut Farmers and Industry Development Trust Fund

Sec. 6. The Coconut Farmers and Industry Development Trust Fund. There is hereby
created a trust fund to be maintained for a period not to exceed thirty (30) years or until the
fund is fully utilized to be known as the Coconut Farmers and Industry Development Trust
Fund, hereinafter referred to as the Trust Fund, which shall consist of the Trust Principal


and the Trust Income. No portion of the Trust Fund shall be derived from the General
Fund of the National Government: Provided That, any unutilized balance in the Trust Fund
after thirty (30) years shall revert to the General Fund of the National Government, and shall
be capitalized, managed, utilized, and accounted for in the manner provided in this Act.
Nothing in this Act shall be understood to prevent or prohibit any person, group, or entity
from conveying to the Committee other properties and/or additional assets either for the
use of the coconut industry or for the purposes of privatization in which case the proceeds
of such privatization shall form part of the Trust Fund.

Sec. 7. Purpose of the Trust Fund. The Trust Fund shall be used exclusively for the
ultimate benefit of coconut farmers and for the development of the coconut industry, as
embodied in the Coconut Farmers and Industry Development Plan to be prepared pursuant
to Section 21 hereof,

Sec. 8. Capitalization of the Trust Fund. All assets and/or properties derived from all
coconut levy recovered assets; and all dividends, interest earnings, and incomes that are
available upon the effectivity of this Act shall form part of the initial capital of the Trust
Fund. The Trust Fund shall thereafter be augmented with all the proceeds of
privatization/disposition of the Coconut Levy Assets remitted directly thereto by the PMO
in accordance with this Act, including any and all forms of income, interests, earnings,
yields, or any monetary benefit derived therefrom prior to the privatization/disposition of
these Coconut Levy Assets.

In order to ensure the enduring character of the Trust Fund, the Principal thereof shall be
augmented by grants, donations, and other lawful transfers by public or private entities.
At the end of the year, all unspent portion of the trust income for the year shall accrue to
the Trust Principal

Sec. 9. Management and Utilization of the Trust Fund. The Trust Fund shall be
available and may be utilized only for the purpose for which it was created and upon
authorization of the Committee, subject to the following conditions:

4 Ten Billion Pesos (PHP 10,000,000.000.00) of the initial trust principal, which
shall be known as the Jumpstart Fund, may be used within two (2) years
commencing from the approval of the plan by the President to jumpstart the
development of the industry:

b. All disbursements shall only be made on the basis of the funding requirement of
the program, activity, or project by the Committee as provided in the Coconut
Farmers and Industry Development Plan: Provided, That an annual allocation of at
least Five Billion Pesos shall be released for the programs and projects provided
under this Act; and

C. The ceiling for expenses of the Committee for the administration, monitoring,


evaluation, information services. and other necessary activities for the effective
performance of its functions under this Act shall be provided in the Implementing
Rules and Regulations under Section 26 of this Act.

All releases from the Trust Fund approved by the Committee shall be released directly to
the implementing agencies; Provided That, coconut productivity and developmental
programs and projects shall be implemented by the Philippine Coconut Authority (PCA)
created under PD No. 232 (s. 1973). as amended by PD No. 1468 (s. 1978). Other coconut
productivity and developmental programs and projects implemented by other agencies shall
be closely coordinated with the PCA.

Disbursements or expenditures by the concerned implementing agencies in violation of the
purpose of the Trust Fund shall be void and shall subject the erring officials and employees
to disciplinary actions in accordance with existing laws, and to appropriate criminal
action under existing penal laws. Disbursements of the funds should be done in accordance
with the Government Accounting Manual and all other related laws, rules, and regulations.

Sec. 10. Designation of the Bureau of the Treasury as Depository of the Trust Fund.
Any law to the contrary notwithstanding, the BTr is hereby designated as the depository
of the Trust Fund, which shall:

a Hold and account the Trust Fund in the manner set forth by the Committee;

b. Release funds directly to the implementing agencies upon the instruction of the
Committee;

c. When so appointed by the Committee. act as a fund manager of the investments
of the Trust Fund with the authority and accountability as that of a private fund
manager; and

4. Perform other tasks as may be authorized by the Committee.

The Committee may designate alternative depository banks which shall perform the
same functions as that of the BTr.

Chapter IV
Coconut Farmers and Industry Development and Industry Trust Fund
Committee

Sec. 11. Creation of the Coconut Farmers and Industry Development Trust Fund
Committee. The Coconut Farmers and Industry Development Trust Fund Committee is
hereby created under the OP.

The Committee shall have the following powers and functions:

a. Coordinate and monitor the implementation of the Coconut Farmers and Industry


b. Approve any allowable disbursement out of the Trust Fund pursuant to
Section 14 of this Act;

| Development Plan;
¢. Formulate the Investment Guidelines pursuant to the allowable investment stated

in Section 28 of this Act;

d. Appoint a fund manager. if necessary, to handle the investment of the Trust

e Identify the Coconut Levy Assets that will be privatized, retained, or
abolished and submit its recommendation to the President for approval;

| Principal:

! £ Approve the marketing and disposition program for the Coconut Levy Assets

i eta es,
i approved for privatization:
H

8 After obtaining the approval of the President, authorize the sale and other
mode of privatization of Coconut Levy Assets approved for privatization;

i h Authorize the rehabilitation of Coconut Levy Assets approved
lt for privatization pending actual disposition:

i, Submit reports and recommendations to the President in connection with its
functions under this Act; and

i Exercise such other incidental powers and functions as may be necessary
to attain the objectives of this Act.

The PCA shall provide Secretariat support to the Committee.

Sec. 12. Composition. The Committee shall be composed of the following:

a, Six (6) representatives from the government who shall be serving in ex officio

capacities:

|. Secretary of the Department of Agriculture ( )A). as Chairperson:

2. Secretary of the Department of Finance (DOF). as Vice Chairperson;

| 3. Secretary of the Department of Trade and Industry (DT1):
4. Secretary of the National Economic and Development Authority (NEDA)
5. Administrator of the PCA; and
6. A representative from the Office of the Executive Secretary.
i] b. Three (3) representatives from the coconut farmers’ organizations, one (1) from
| Luzon, one (1) from Visayas, and one (1) from Mindanao. who have
considerable experience, substantial membership, and reputable track records.
H ¢. Two (2) representatives from the coconut industry sector who have
i considerable experience and reputable track records.



The nominees of the coconut farmers’ organizations shall be validated and shortlisted by
the PCA. The list of nominees, which shall number at least three (3) per island group, shall be
submitted to the President not later than thirty (30) days following the effectivity of this
Act. The representatives of the coconut industry sector shall be appointed by the President
from a list of nominees, which shall number at least six (6), submitted by the PCA.

The government representatives in the Committee shall serve only during their respective
terms in office. The representatives from the coconut farmers’ organizations and the
coconut industry sector shall each hold a term of three (3) years, unless sooner removed for
cause, And may be reappointed once. Any of the representatives shall continue to hold office
until their successor is appointed; Provided That. any appointment to fill a vacancy in the
Committee shall be only for the unexpired term.

Sec. 13. Ex Officio Alternates. The ex officio members of the Committee may: designate
their respective permanent alternates who shall be the officials next-in-rank to them and their
acts shall be considered acts of their principals.

Sec. 14. Meetings of the Committee. The Committee shall meet once a month, or as
often as deemed necessary and expedient to discharge its responsibilities. The presence -of
at least a majority of the members present at a meeting at which a quorum exists shall
be adequate for any decision by the Committee; Provided, That the approval of at least a
majority of the members of the Committee shall be required on matters involving the
following:

a Any single disbursement of funds involving more than Fifty Million Pesos (Php
50,000.000.00),
b Any proposed investment involving more than One Hundred Million Pesos (Php
100.000,000.00); and
¢ All dispositions or privatization proposals.
Provided further, That the disbursements requiring the approval of at least a majority of the
members of the Committee may be subject to the President's disallowance.

The Chairperson, if unavailable, may designate the Vice Chairperson to convene the
Committee and preside over the Committee's meeting on behalf of the Chairperson.

Sec. 15. Compensation of the Members of the Committee. The members of the Committee
may be entitled to per diems and reimbursable expenses, in accordance with the COA rules
and regulations.

Sec. 16. Obligations of the Members of the Committee. The members of the
Committee shall act with due care, diligence, skill, and good faith in all its dealings
with the Trust Fund and the Coconut Levy Assets. They shall avoid conflicts of interest
and declare before the Committee any interest they may have in any particular matter.

Where a member of the Committee receives any profit or benefit by virtue of his office,
including acquiring shares in corporations that form part of the Coconut Levy Assets,


using the Coconut Levy Assets for one’s benefit, receiving commission on contracts from
the Coconut Levy Assets, or taking advantage of corporate opportunities involving the
Coconut Levy Assets. all such profits or benefits shall be returned to the Trust Fund
without prejudice to any administrative. civil. or criminal action against such member. This
provision shall be applicable notwithstanding the fact that such member of the Committee
used one’s own funds in the venture,

The Committee shall recommend to the President the removal and replacement of the
member who performs such acts

Sec. 17. Executive Director of the Committee. The administrator of the PCA shall be
appointed as Executive Director of the Committee.
The Executive Director shall have the following powers and functions:

a. Execute policies and administer the programs approved or promulgated by the
Committee;

b. Monitor the progress of the implementation of the Plan and submit periodic
reports to the Committee;

c. Prepare an annual report on the activities of the Committee at the close of each fiscal
year and to submit a copy thereof to the President and Congress;

4. Keep and maintain official records and reports of the proceedings of the
Committee;

e. Administer oaths in all matters falling within the jurisdiction of the Committee; and

d, Exercise such other duties as may be vested by the Committee that are
consistent with the provisions of this Act.

Sec. 18. Cooperation with the Committee. The Committee may also call upon any
department, bureau, office, agency, and instrumentality of the Government, including
Government-Owned or -Controlled Corporations (GOCCs), for any assistance it may need
in the discharge of its functions and responsibilities as well as in the implementation of
its programs and projects.

Sec. 19. Accounting and Auditing. The Committee shall maintain records and accounts of all
investments, income, receipts, disbursements, and other transactions relating to the
management, administration, and disposition of the Trust Fund. These records and accounts
shall be maintained in accordance with existing accounting and auditing laws, rules, and
regulations. The Trust Fund shall be audited by the COA.

Sec. 20. Legal Counsel. The Solicitor-General shall be the ex officio counsel of the
Committee on legal matters.


Chapter V
Coconut Farmers and Industry Development Plan

Sec. 21. Preparation of the Coconut Farmers and Industry Development Plan. An
Ad Hoc Committee is hereby created to be composed of technical officials from the
Department of Agriculture, the Department of Agrarian Reform, the Department of the
Interior and Local Government, the Department of Finance, the Department of Public
Works and Highways. th e Department of Science and Technology, the Department of
Social Welfare and Development, Department of Health, the Department of Trade and
Industry, the Department of Budget and Management, the National Economic and
Development Authority, the National Anti-Poverty Commission, the Technical Education and
Skills Development Authority, the Land Bank of the Philippines, and the Development Bank
of the Philippines.

In addition, twelve (12) representatives from the coconut farmers’ organizations composed
of four (4) from Luzon, four (4) from Visayas, and four (4) from Mindanao: and four (4)
representatives from the different coconut industry sectors who all have considerable
experience, substantial membership. members with reputable track records, shall also be
members of the Ad Hoc Committee

The nomination process of the representatives from the coconut farmers organizations from
the different coconut industry sectors shall be the same as that in Chapter IV. Section
12 of this Act; Provided, That, the list of nominees from the coconut farmers:
organizations shall number at least twelve (12) per island group: Provided, also, that
cight (8) of the twelve (12) representatives from the Coconut Fanners' Organizations must
not have more than five (5) hectares of coconut farm landholding: Provided Further.
Thai, the list of nominees from the coconut industry sector shall number at least twelve

(12),
The Administrator of the PCA shall act as the Ad Hoc Committee's Chairperson.

The members of the Ad Hoc Committee shall he compensated in the same manner as that
of the Committee under Chapter IV, Section 15 of this Act.

The Ad Hoc Committee, in consultation with coconut farmers’ organizations, industry
associations, civil society organizations, academe, concerned government agencies, and other
stakeholders in the coconut industry shall indicate in an integrated coconut industry
strategy the policies for the development and rehabilitation of the coconut industry. It shall
prepare every five (5) years, or as determined by the Committee, a medium term plan of
programs, activities, and projects, which shall be funded out of the Trust Fund and which
shall be known as the Coconut Farmers and Industry Development Plan. hereinafter referred
to as the Plan. The Plan shall be consistent with the Philippine Development Plan and shall
be subject to mandatory review every year.

10


‘The Administrator of the PCA shall submit an annual report to the Committee on the status of
the implementation of the Plan and its corresponding programs/projects

‘The PCA shall commission an independent study on the third year, or any other date as may
be determined by the Committee, to assess the impact of the programs and projects in the Plan.
The results of the independent study shall be one of the bases to update the Plan. The conduct
of the study shall be chargeable to the regular funds of the PCA.

In the formulation of the Plan, the Ad Hoc Committee shall be euided by the following
objectives:

a. Increase in the income of coconut farmers and increase coconut productivity
including intercropping and livestock-raising:

b. Establishment of coconut-based enterprises including integrated processing of coconut
products and downstream products:

¢. Rehabilitation and modernization of the coconut industry towards global
competitiveness

d. Provision of timely and critical support to coconut farmers organization: and

¢. Establishment of social protection programs that directly benefit the coconut farmers
and farm workers, in case these social protection programs are not funded by an
appropriations law or any other special laws, or where funding is insufficient. The social
protection programs shall include: (1) social services such as life, medical, and accident
insurance coverage of the coconut farmers and farm workers; (2) scholarships for the benefit
of the deserving descendants of the coconut farmers and farm workers; and (3) livelihood
programs.

The Plan shall provide an indicative funding requirement or allocation for the
implementation of any and all of the programs and projects, which funding or allocation
shall be itemized or broken down on a project-to-project basis: Provided. That (a) for
projects which are recurring, or to be implemented on a regular basis, the allocation shall
indicate the annual fund that may be required to implement the project: and (b) for projects
that are to be implemented or concluded within a period of time, the allocation shall
indicate the total fund that may be required for the implementation of the whole project,
itemized according to the phases or stages of the project. The Plan shall also include the
contribution of the regular budget of the PCA.

Within ninety (90) days from the appointment of all farmer-representatives and the
industry representatives, the Plan shall be submitted by the Ad Hoc Committee to the
Committee which shall, in turn, submit the Plan to the President, as endorsed by the
Economic Development Cluster, for approval. Immediately upon its approval, the Plan
shall be returned to the Committee for the disbursement of funds in accordance with the
provisions of this Act. Any amendment to the Plan shall require the approval of the

President, as endorsed by the Economic Development Cluster.
"


If the President has any objection or any amendment thereto, the President shall notify the
Committee within thirty (30) days from receipt thereof: otherwise, the Plan shall be
deemed approved

Chapter VI

Pri

jon of the Coconut Levy Assets

Sec. 22. Privatization of Coconut Levy Assets. Pursuant to the national policy on the
efficient and transparent privatization of government assets (including GOCCs) which are
unnecessary or inappropriate for the government sector to maintain:

a. The Governance Commission for Government-Owned or -Controlled Corporations
shall determine whether it is to the best interest of the Government to privatize any
non-cash Coco Levy Asset and recommend to the President the privatization and the
mode of the divestment, taking into account the need to generate maximum cash
recovery and the implications of such divestment on the coconut industry.

b. The PMO shall be the disposition entity for non-cash Coconut Levy Assets which
shall have been approved for divestment by the President and shall expeditiously
sell, alienate, or dispose of the same upon securing the favorable recommendation
of the Privatization Council pursuant to EO No. 323 (s. 2000) and other relevant
laws, orders, rules, and regulations, and the prior approval of the Committee. In the
discharge of this additional mandate, the PMO is hereby empowered to implement the
actual marketing/disposition program for the non-cash Coconut Levy Assets, to execute and
deliver, on behalf of the Goverment, the deeds of sale, contracts, and other instruments as
may be necessary or appropriate to convey title to such assets to take possession of and
conserve the non-cash Coco Levy Assets transferred to it and engage external expertise as
may be necessary in the fulfillment of its tasks under this Act. Any sale and other mode of
privatization shall not be considered final unless favorably recommended by the
Privatization Council and approved by the Committee.

c. The PMO shall, within three (3) months from the closure of its books at the end of each
fiscal year, submit a comprehensive annual report to the President, through the Privatization
Council, on the status of its privatization efforts and its disposition program for the non
cash Coco Levy Assets, which report shall include a description of the assets privatized and
disposed of, the purchasers, the consideration received, and the agreed terms of payment.

Sec. 23. Proceeds from Privatization. All proceeds and receipts or revenues arising out of or in
connection with the privatization of the Coconut Levy Assets shall be deposited to the Trust Fund,
after deducting reasonable expenses actually, directly, and exclusively incurred by the PMO in
connection with such privatization as stated uncle’ Section 22 hereof.

Sec. 24, Allowable Investment. The Committee shall manage the Trust Principal with the skill,
care, prudence, and diligence necessary under the circumstances that a prudent person acting in like


capacity and familiar with such matters would exercise in the conduct of an enterprise of a like
character with similar aims, Pursuant thereto and in line with the basic principles of safety, growth,
and liquidity, the Trust Principal shall only be invested in any or all of the following:

a, Bonds, securities, securities, promissory notes, or other evidence of indebtedness of the
Government of the Philippines, or in bonds, securities, promissory notes, and other evidence of
indebtedness to which full faith, credit, and unconditional guarantee of the Republic of the
Philippines is pledged:

b. Bonds, securities, promissory notes. or other evidence of indebtedness of
government financial institutions or government corporations with acceptable credit or guarantee;
Provided, That such investments shall be subject to a ceiling to be fixed by the Committee in the
implementing rules and regulations; and

©. Deposits and loans and/or investments in any domestic bank doing business in the Philippines
and in good standing with the Bangko Sentral ng Pilipirms; Provided, That in case of such deposits,
these shall not exceed at any time the unimpaired capital and surplus or total private deposits of the
depository bank. whichever is smaller; Provided Further. That the bank shall have been first
designated as a depository for this purpose by the Monetary Board of the Bangko Sentral ng
Pilipinas; Provided Finally, That such investments shall be subject to a ceiling to be fixed by the
Committee in the implementing rules and regulations

Chapter VII
Final Provisions
Sec. 25. Suppletory Application of Republic Act No. 10149 and Executive Order No. 323.

In the interpretation of the provisions of this Act, the provisions of RA No. 10149. Otherwise
known as the "GOCC Governance Act of 2011." shall apply suppletorily. EO No. 323.
Entitled, "Constituting an Inter-Agency Privatization Council and Creating a Privatization and
Management Office under the Department of Finance for the Continuing Privatization of
Government Assets and Corporations," shall also apply suppletorily.

Sec. 26. Implementing Rules and Regulations. Within thirty (30) days from the date of the
constitution of the Committee, it shall formulate and promulgate the rules and regulations for
the proper implementation of this Act. in consultation with the PMO.

Sec. 27. Congressional Oversight. The Congressional Oversight Committee on
Agricultural and Fisheries Modernization shall exercise oversight functions over the
implementation of this Act. The financial review of the program in relation to its performance
indicators shall be subject to the oversight functions of the Joint Congressional Oversight
Committee on Public Enterprises.

Sec. 28. Separability Clause. If any provision of this Act is declared invalid or
unconstitutional, the other provisions not affected by such declaration shall remain in full force
and effect.


Sec. 29. Repealing Clause. All laws, executive and administrative orders, rules and
regulations inconsistent with this Act are hereby repealed or amended accordingly.

Sec. 30, Effectivity. This Act shall take effect fifteen (15) days after its publication in the
Official Gazette or in a newspaper of general circulation