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

Eighteenth Congress
First Regular Session

HOUSE BILL NO.2610

Introduced by Honorable ROMEO M. JALOSJOS, JR.

AN ACT ESTABLISHING THE COCONUT FARMERS AND
INDUSTRY DEVELOPMENT TRUST FUNDS AND PROVIDING
FOR ITS MANAGEMENT AND UTILIZATION.

EXPLANATORY NOTE

During the seventeenth (17) Congress this measure has been filed under
consolidated H.B. No. 9197 and gone through a second reading committee
approval and status thereof as procedure is within the Committee on
Appropriations for review on the included provisions for fiscal allocation.

This bill seeks again for the creation and establishment of coconut farmers
and industry development trust fund to benefit the coconut farmers which has
been long overdue that deprived utilization of our poor farmers being declared
conclusively owned by the Republic of the Philippines to be used exclusively to all
coconut farmers and for the development of the coconut industry.

In view of the foregoing, the immediate approval of this bill is requested.

(O M. JALOSJOS, JR.
Representative


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

Eighteenth Congress
First Regular Session

HOUSE BILL NO.2610

Introduced by Honorable ROMEO M. JALOSJOS, JR.

AN ACT ESTABLISHING THE COCONUT FARMERS AND INDUSTRY
DEVELOPMENT TRUST FUNDS AND PROVIDING FOR ITS MANAGEMENT
AND UTILIZATION PRIORITIZING BUT NOT LIMITED TO COCONUT
FARMERS COOPERATIVE ORGANIZATION.

Section 1. Short Title. This Act shall be known as the “Coconut Farmers and
Industry Development Trust Fund Act”.

Section 2. Declaration of Policy. It is hereby declared the policy of the State to
pursue and attain the balance, equitable, integrated, and sustainable growth and
development of the coconut industry. Towards this end, the State shall adopt the
necessary measure 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

Section 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 form 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.

. CCIF Holding Companies-refer to the fourteen (14) holding companies,
namely: 1.Anglo Ventures Corporation: 2. ASC Investors Inc.,: 3.Arc
Investors Incorporated: 4.AP Holdings Incorporated: 5. Fernandez
Holdings Incorporated; 6.First Meridian Development Inc., 7.Randy Allied
Ventures; 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 CIIF Oil Mills Group to acquire, hold and manage the
shares of stocks of San Miguel Corporation (SMC).

. CIF Oil Mills Group-refers to the six (6) CIIF companies namely:
1Southern Luzon Coconut oil Mills; 2. Cagayan de Oro Company
Incorporated; 3. ligan 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.

. CIF SMC Block Shares-refer to the 33,133,266 shares of stock in SMC
sequestered by the Presidential Commission on Good government (PCGG)
in April 1986 representing the 31 percent of the total outstanding capital
stock of SMC.

. Converted SMC Series I Preferred Shares-refer to that portion of the CIIF
SMC Block Shares covering 753,848,312 preferred shares of stock in SMC
representing 24 percent 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. Leaseholder 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 the
following:

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

. The CIIF Oil Mills Group;

. The CIIF Holding Companies;

‘The Converted SMC Series 1 Preferred Shares; and

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

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. 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
6. The Coconut Investment fund created under R.A. No 6260,

7. The Coconut Consumer Stabilization Fund, later renamed as the
Coconut Stabilization Fund, created under P.D. no. 276;

8. The coconut Industry Development Fund created under P.D. 582;

9. The Coconut Industry Investment Fund created pursuant to P.D. 1468
and;

10. The Coconut Reserved Fund created under P.D.1468 and P.D. 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 11 of this Act.
hereinafter referred to as the Committee, and as may be amended from
time to time which shall provide the parameters for investment 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 requirement.

‘Trust Income refers to the income, interest earnings, aiid 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 1 Preferred Share; the proceeds from the
redemption of the Converted SMC 1 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 administration of the CIF;

2. Any and all proceeds of privatization of the Coco Levy Assets remitted
thereto by the Privatization and Management Office (PMO) organized under
Article III of Executive Order (EO) No.33 (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.

m. COOPERATIVE-a farm business or other organization which is own and
run jointly by its members who share the profits and benefits.

Chapter II
Audit and Reconveyance of Coconut Levy Assets

Section 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 investment, 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, determining completeness of said inventory, the existence of
the subject assets. establishing the reasonableness of the assets valuation, and
tracing of the flow of the 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 empirical basis and methodologies employed for said
valuation, together with its observations for revision and compliance, within
ninety (90) days from submission of the Report on the 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 receipts
of the final version of the Report on the Accounting and Inventory of the
Coconut Levy Assets, in at least two (2) newspapers of the national circulation.

Section 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;

a. 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
c. 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

Section 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 form 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.

Section 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.

Section 8. Capitalization of the Trust Fund- Alll 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, interest, 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.

Section 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:

a. 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
(Php 5,000,000,000.00) 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.

Al 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 Philippines
Coconut Authority (PCA) created under PD No 232 (3.1973), 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.

Disbursement or expenditure 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 penal
laws. Disbursement of the funds should be done in accordance with the
Government Accounting Manual and all other related laws, rulers, and

regulations.

Section 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
investment of the Trust Funds with the authority and accountability as
that of a private fund manager; and

d. Perform other task as may be authorized by the Committee.

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


Chapter IV

Coconut Farmers and Industry Development and Industry Trust Fund
Committee

Section 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 Development plan.

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

c. Formulate the Investment Guidelines pursuant to the allowable
investment of the Trust Principal;

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

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

f. Approve the marketing and disposition program for the Coconut Levy
Assets approved for privatization;

g. After obtaining the approval of the President , authorize the sale and
other mode of privatization of Coconut Levy Assets approved for
privatization:

h. Authorize the rehabilitation of Coconut Levy Assets approved for
privatization pending actual disposition;

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

j. 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.
Section 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:
1. Secretary of the Department of Agriculture (D.A) as Chairperson:
2. Secretary of the Department of Finance (DOF) as Vice Chairperson;
3. Secretary of the Department of Trade and Industry (DTI)


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

b. Three (3) representatives from the coconut farmers organization, one (1)
from Luzon, one (1) from Visayas, and one 91) from Mindanao, who have
considerable experience, substantial membership, and reputable track
records,

c. Two (2) representatives from the coconut industry sector who have
considerable experience and reputable track records. 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.

Section 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 program 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’

d. 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’

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

Section 18. Cooperation of the Composed Committee:

‘The Committee may call upon any department, bureau, office, and instrumentality
of the Government, including Government-Owned or Controlled Corporation
(GOCC’) 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, it
shall be the duties and functions of the Committee to help outsourced target
market on local and international prospective markets on coconut products.


Section 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.

Section 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

Section 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 the 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, and reputable
track records, shall also be members of the Ad Hoc Committee.

The nomination process of the representatives from the coconut farmers
organizations and 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 eight (8) of the twelve (12) representatives from the Coconut
Farmers Organizations must not have more than five (5) hectares of coconut farm
landholdings; Provide Further, That the list of nominees from the coconut
industry sector shal] number at least twelve (12).

The Administrator of the PCA shall act as the Ad Hoc Committee's Chairperson.

The members of th Ad Hoc Committee shall be 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 organization, 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 fine (5) years, or as
determined by the Committee, a medium term plan of programs, activities, and
project, 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
Plan. The Plan shall be consistent with Philippines Development Plan and shall be
subject to mandatory review every year.

‘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

program/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 guided 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 enterprise including integrated
processing of coconut products and downstream products; and allows
installation of only two (2) processing plants within the area of coconut
archipelagic regions determined by the Department of Agriculture by
virtue of a legitimate coconut farmers cooperative organization which
capitalization derived from the coco levy funds loan condition pursuant
to Section 9 Management and Utilization of the Trust Fund thereof.

cc. Rehabilitation and modernization of the coconut industry towards
global competitiveness;

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

e. 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)


scholarship for the benefits 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 period of time, the allocation shall indicate the total fund that
may 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 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 (30) days from receipt thereof; otherwise, the Plan
shall be deemed approved.

Chapter VI
Privatization of the Coconut Levy Assets

Section 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 Government 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 Assets 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
Government, the deeds of sales, contracts, and other instrument 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.

Section 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 under Section 22 hereof.

Section 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 investment shall be
subject to a ceiling to be fixed by the Committee in the implementing
rules and regulations; and

c. Deposit and loans and/or investment in any domestic bank doing
business in the Philippines and in good standing with the Bangko
Sentral ng Pilipinas; 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

Section 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 of Government Assets and Corporations,
“shall also apply suppletorily.

Section 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.

Section 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 Enterprise.

Section 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.


Section 29. Repealing Clause. All laws, executive and administrative orders, rules

and regulations inconsistent with this Act are hereby repealed or amended
accordingly.

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