SIXTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
) 
) 
) 
SENATE 
S. B. No. 2111 
Introduced by Senator FRANCIS G. ESCUDERO 
AN ACT 
.irmdr 
filii.;. "I lit- j",.t;r~ 
'14 
FEB 11 
P1 :38 
REVITALIZING THE q)cONUT INDUSTRY, APPROPRIATING FUNDS 
THEREFOR AND FOR OTHER PURPOSES 
EXPLANATORY NOTE 
This bill is being filed as a counterpart measure of House Bill No. 1998 filed by 
Rep. Sharon Garin in the House of Representatives. 
It is the policy of the State to recognize the essential role of coconut as a strategic, 
indigenous, replenishable and renewable source of livelihood for a great number of 
people. 
The coconut industry, which covers 3.563 hectares or 26% of the total agricultural 
land in the country, is one of the biggest agricultural industries in the country. It 
produces an annual average of 15.2 billion coconuts, with over 24 million direct and 
indirect stakeholders in over 69 provinces in the country. 
The Philippine Coconut Authority was created pursuant to Presidential Decree 
232 in 1973 to promote the accelerated development of the coconut industry and to 
provide policy directions for such purpose. Subsequent legislations were also enacted 
for the same purpose, the last being Presidential Decree 1468 in 1978. However, said 
laws were created to address the conditions of the coconut industry almost 4 decades 
ago, making the present charter of the Philippine Coconut Authority undeniably 
deficient. 
Thus, this bill brings about the necessary transformations to the Philippine 
Coconut Authority both at the policy and operational levels, by legislating a Coconut 
Industry Development Act which will provide an up-to-date .overall strategic guidance 
to the industry. To implement the policy and objectives of this measure, a non-stock, 
goverrunent corporate entity known as the Philippine Coconut Industry Development 
AuthOrity (PHILCIDA) is created and established, headed by a 7-member Board of 
Directors with its Chairman as head and Chief Executive Offieer of the Authority. 
This measure equips the PHILCIDA with solid and multifaceted mandate, which 
focuses on developmental, goverrunental, regulatory, research and development, and 
corporate powers and functions. It also provides assistance to coconut farmers through 
marketing assistance and other extension services to boost the yield and expand the 
income of coconut farmers, as well as intermediation and arranging services for 
investment, financing, and trade, among others. It also presents measures on 
rehabilitation and fertilization of coconut trees. 
, , 


Removal of corporate restriction of PCA is also proposed to make it a profitable, 
sustainable, and development-oriented agency. In 2013, PCA had only a subsidy of 
around P939.750 million, equivalent to a mere 1.86% of the total allocation of the 
Department of Agriculture. 
Research and development is also provided in the bill to cultivate a culture of 
scientific excellence and professionalism in its agricultural and industrial research and 
establish credence to the initiatives, findings, and innovations of PCA. This will allow 
the development and propagation of new discoveries and technologies. 
In view of the foregoing, the passage of this measure is fervently sought. 
FRANCIS G. ESCUDERO 


SIXTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
) 
) 
) 
SENATE 
'14 
FEB n Pl :38 
S. B. No. 
RECEIVED In. -r 
Introduced by Senator FRANCIS G. ESCUDERO 
AN ACT 
REVITALIZING THE COCONUT INDUSTRY, APPROPRIATING FUNDS 
THEREFOR AND FOR OTHER PURPOSES 
ARTICLE I 
GENERAL PROVISIONS 
1 
SECTION 1. Short Title. - This Ad shall be known as "The Coconut Industry 
2 
Development Act." 
3 
4 
SECTION 2. Statement of Policy. - It is the policy of the State to recognize the 
5 
essential role of coconut as a strategic, indigenous, replenishable and renewable 
6 
source of livelihood for a great number of people. Towards this end, the State shall 
7 
promote the rapid, steady and continuous integrated development and growth of 
8 
. the coconut industry in all its aspects and ensure that the coconut farmers, farm 
9 
workers, processors, lessees and tillers, and their families, shall become direct 
10 
participants in, and beneficiaries of, such development and growth thereby 
11 
increasing their income and uplifting their quality of life. 
12 
13 
As used in this Act, "coconut" shall encompass coconut trees and oil palm 
14 
trees, and coconut and oil palm-based products and by-products. 
15 
16 
SECTION 3. Goals and Objectives. - Pursuant to the above-mentioned policy, 
17 
the effort of government shall be directed towards the following goals and 
18 
objectives: 
19 
20 
21 
22 
23 
24 
25 
a) Promote the steady, accelerated, and orderly development of the coconut 
industry consistent with the agrarian reform policy of the government; 
b) Develop and establish the coconut farming systems including but not 
limited to the establishment of model coconut farms; 
26 
c) Hasten and advance industrialization in the coconut industry and the 
27 
diversification and proper utilization of coconut products and by-products, 
28 
and oil palm products and by-products; 
29 
30 
d) Promote the effective utilization and marketing of coconut products and by-
31 
products and oil palm products and by~products in the domestic and 
32 
foreign markets and preserve the competitiveness and reliability of the 
33 
country as a major producer and supplier of said products, by establishing 
34 
national standards acceptable in the international market; 
35 


1 
2 
3 
4 
e) To increase production by expanding the planting and replanting program 
of coconut trees in strategic areas identified as having the most potential 
and the rehabilitation and fertilization of existing coconut trees; 
5 
f) Conduct scientific researches and investigations in all areas pertaining to 
6 
agricultural, industrial, marketing and socio-economic aspect of the coconut 
7 
industry and encourage the participation of small farm holders in research 
8 
and technology; 
9 
10 
g) Encourage and promote the organization of coconut farmers cooperatives, 
11 
associations, and organizations and provide them credit and financing 
12 
schemes; 
13 
14 
h) Generate and disseminate information and communication to farmers, 
15 
producers and other sectors to ensure the appreciation and adoption of 
16 
appropriate technology and practices, inventions, as well as the proper 
17 
awareness and correct understanding of issues and development in the 
18 
coconut industry; and 
19 
20 
i) Coordinate and integrate all efforts of various agencies of government and 
21 
provide general direction for the steady and orderly development of the 
22 
industry. 
23 
ARTICLE II 
24 
POWERS AND FUNCTIONS OF THE 
25 
PHILIPPINE COCONUT INDUSTRY DEVELOPMENT AUTHORITY 
26 
27 
SECTION 4. Philippine Coconut Industry Development Authority. - To 
28 
implement the policy and objectives of this Act, there is hereby created and 
29 
established a non-stock, government corporate entity known as the Philippine 
30 
Coconut Industry Development Authority (PHILCIDA), hereinafter referred to as 
31 
the Authority. 
32 
33 
SECTION 5. Powers and Functions. - The Authority shall exercise the 
34 
following core powers and functions: 
35 
36 
a) Developmental Power and Function 
37 
1) Formulate and adopt a general program of development geared towards 
38 
increased farm productivity, through planting or replanting of suitable 
39 
seedling varieties, rehabilitation and fertilization of coconut, integrated 
40 
coconut-based farming systems and product processing, and whenever 
41 
necessary, the construction of related support and infrastructure 
42 
facilities. For this purpose, the Authority shall adopt a special program 
43 
to maximize the yield of small coconut farmers and their farm families 
44 
particularly those farms covered by the agrarian reform program of the 
45 
government; 
46 
47 
b) Research and Development Powers and Functions 
48 
1) Undertake scientific researches and investigations on crop and varietal 
49 
improvement, pests and diseases, agronomy and mineral nutrition, 
50 
coconut wood utilization, Virology and biochemistry and epidemiology 
51 
of cadang-cadang, and such other similar studies on varietal and crop 
52 
improvement of general or local suitability; 
- 2 -


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 
34 
35 
36 
37 
38 
39 
40 
41 
42 
43 
44 
45 
46 
47 
48 
49 
50 
51 
52 
53 
c) 
2) Undertake scientific researches and investigations on food, non-food 
products and by-products including bio-diesel, directly or in 
collaboration with other public agencies or the private sector; 
3) Conduct intensive studies and data research, establish and maintain a 
database of primary, accurate and reliable information on coconut 
culture, production, pricing capacity, marketing, inventories as well as 
scientific thesis and treaties in coordination with other government 
offices, the private sector and international agencies and bodies; 
4) Establish, maintain and operate such number of research centers and 
experiment stations, including laboratories, seed gardens, nurseries, 
pilot farms and industrial facilities as may be necessary to undertake 
extensive research in coconut pests and diseases, improvement of copra, 
manufacture of coconut products and by-products or oil palm products 
and by-products, and the greater utilization of the coconut for 
traditional and non-traditional uses; 
5) Construct, invest, establish and operate integrated coconut centrals, 
processing plants and integrated processing mills and other support 
facilities in aid of its research and development function; 
6) Secure or obtain registration of intellectual property rights on any 
discoveries, new process, or utilization involving coconut products and 
by-products or oil palm products and by-products resulting from its 
research and studies; 
7) Develop, package, utilize, promote, and transfer viable techniques and 
technologies: Provided, however, That an appropriate royalty or 
technological transfer fee shall be imposed, the amount of which shall be 
determined by the PHILCIDA Board of Directors; 
8) Purchase or fabricate such machineries, material, equipment and 
supplies as may be necessary to execute successfully such researches, 
investigations and experimental work as provided under this Act on its 
own or in partnership with other agencies. 
Regulatory Powers and Functions 
1) Regulate the marketing and the exportation of coconut products and 
by-products and oil palm products and by-products to conform with 
quality or food standards recognized by both the domestic and 
international market; 
2) Take samples and conduct examination of any copra, coconut 
products and by-products and oil palm products and by-products that 
are subject to domestic and international standards; to conduct 
laboratory analysis to determine the chemical characteristics of 
moisture content, contaminants, including the presence of toxin and 
other contaminants and issue the necessary commodity clearance and 
export permit: Provided, That the Authority may withhold the issuance 
of such clearance or permit, or suspend or cancel any clearance or 
permit already issued in case of violation by the holder of any 
provision of this Act or rules and regulations duly promulgated by 
the Authority; 
3) Develop and recommend for the adoption of the Bureau of Plant 
Industry and other concerned government agencies measures and 
methodology quarantine for coconut products and by-products and 
oil palm products and by-products; to impose such restrictions in the 
transport movement or handling of the same in accordance with such 
standards and quarantine procedure determined by the Authority; 
- 3 -


I 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 
34 
35 
36 
37 
38 
39 
40 
41 
42 
43 
44 
45 
46 
47 
48 
49 
50 
51 
52 
53 
54 
d) 
4) Order the closure of any mill, refinery, processing firm, copra 
warehouse or any place or building where coconut products and by-
products or oil palm products and by-products are stored or to 
intercept any vehicle or ship or vessel carrying or transporting 
coconut products and by-products or oil palm products and by-
products, and seize the contents thereof, where there is reasonable 
ground to believe that the owner, possessor or person or persons in 
control of such place, building, vehicles, ship or vessel, of such 
products have violated the provisions of this Act or any rules and 
regulations promulgated thereto in a manner that is prejudicial and 
detrimental to the coconut industry, or the consuming public; 
Corporate Powers and Functions 
1) Create subsidiaries or enter into partnerships or joint ventures with 
any public or private foreign or local entity, natural or juridical, and 
acquire, own or hold shares of stock or interest therein for the purpose 
of fully utilizing the commercial value of pioneer and new technology 
generated in the industry, or of financing the manufacture, on 
commercial scale of coconut products and by-products or oil palm 
products 
and 
by-products: 
Provided, 
That 
such 
subsidiary, 
partnership, joint venture, which the Authority is authorized to create, 
shall be governed by the provisions of general laws applicable to 
corporations and such entities: Provided, further, That after such 
partnership, subSidiary, or joint venture with private Filipino citizens 
or entities authorized to be created shall have become fully viable for 
commercial operation, and the Authority has recovered its 
investments or contributions, the Authority shall immediately divest 
itself of its interest over the partnership, subsidiary, or joint venture in 
favor or any private person or entity. For purposes of this paragraph, 
the Authority shall make studies and investigations of the enterprises 
and projects for which the loans, contributions and subSCriptions to 
the capital of the enterprise or investments mentioned are needed, 
and determine the advisability of financing the same; 
2) Lease real estate, lands and interest in lands owned and acquired by 
the Authority including buildings or other structures with their 
appurtenances in pursuance of any partnership or joint venture to 
implement its technology or developmental projects and programs; 
3) Borrow, raise or obtain funds; to issue bonds and other instruments of 
indebtedness; or to enter into any financial or credit arrangement 
from any financial or lending institutions, local or foreign, in order to 
support or carry out its objectives and purposes, subject to pertinent 
laws governing public debts and expenditures; and when necessary, 
subject to the approval of the President; 
4) Receive 
grants, 
subsidies, 
donations 
or 
contributions 
from 
corporations, trusts, foundations, associations and other sources from 
any private or government office, agency or corporation, local or 
foreign; 
5) Purchase, own, lease, hold, or otherwise acquire real estate, lands and 
interest in lands and to own, hold, improve, develop, and manage any 
real estate so acquired and to erect, rebuild, enlarge, alter or improve 
buildings or other structures with their appurtenances on any lands so 
owned or occupied; 
6) Purchase, own, lease, hold, or otherwise acquire such machineries, 
equipment, tools, materials, supplies, or other parts as may be 
-4-


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
necessary, convenient or appropriate for any of the purposes for 
which the Authority is formed; 
7) Invest and deal with the funds of the Authority in stocks, bonds and 
other secured collaterals with skill, care, prudence and diligence, in 
order not to make such funds idle and unproductive pending their 
full utilization for the principal objects and purposes for which the 
Authority 
has been organized: Provided, however, That such 
investment or investments shall be subject to the approval of the 
President. 
11 
e) Extension Services and Market Development Powers and Functions 
12 
1) Render training, extension service programs and disseminate 
13 
information to coconut farmers, farm workers and processors relative 
14 
to production technology, marketing systems, entrepreneurial and 
15 
other technical skills and values, attitude formation and socio-
16 
economic development strategies; 
17 
2) Promote, encourage and assist coconut [planters,] farmers, processors 
18 
and workers organize themselves into associations and cooperatives, 
19 
equip them with greater capability of marketing their products, and 
20 
assist them obtain more credit facilities; to register and accredit such 
21 
associations and cooperatives for purposes of participation in the 
22 
developmental programs of the Authority: Provided, That the 
23 
Authority shall not directly or indirectly influence the farmers in the 
24 
exercise of their choice or selection of candidates or leaders in the 
25 
organizations; 
26 
3) Provide, in coordination with the private sector, a system of 
27 
accreditation of association of traders, millers, desiccators, farmers, 
28 
exporters and end-users of coconut products and by-products and oil 
29 
palm products and by-products; 
30 
4) Undertake or participate in trade missions to obtain better preferential 
'31 
trading arrangements with importing countries, and enter or 
32 
otherwise participate in behalf of the coconut trading industry in all 
33 
agreements, arrangements, missions or conventions with any foreign 
34 
government or entity with respect to trading relations, market quotas, 
35 
tariff and non-tariff barriers and such other matters affecting the 
36 
export of coconut products and by-products, and oil palm products 
37 
and by-products; 
38 
5) Assist coconut farmers, organizations in marketing their products 
39 
locally or abroad when the need arises; 
40 
6) Assist coconut farmers organizations in establishing farmer owned 
41 
bonded warehouses and processing facilities; 
42 
7) Develop credit assistance programs and funding mechanisms for 
43 
coconut [planters,] farmers, processors, workers, and organizations; 
44 
8) Engage in the business of manufacture and merchandise of coconut 
45 
consumer products and by-products and distribute the same in the 
46 
local market to avert the ,short supply of such products for the interest 
47 
of the consume!s; 
48 
9) promote the expansion and development of the domestic and foreign 
49 
market for coconut products and by-products and oil palm products 
50 
and by-products. 
51 
52 
f) Governmental Powers and Functions 
53 
1) Impose and collect all fees, charges, assessments and imposts 
54 
including interests and surcharges authorized under this Act or its 
- 5 -


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 
34 
implementing rules and regulations and disburse funds generated by 
the Authority from its operations to carry out. its functions; 
2) Require exporters, traders, millers, refiners, desiccators, oleo-chemical 
processor, other manufacturers and end-users of coconut products 
and by-products, and oil palm products and by-products to submit 
periodic reports of production, receipts of deliveries or purchases or 
both, sales, inventory, contracts and such other data the Authority 
may deem necessary to properly and effectively promote the 
development of the industry; 
3) Promulgate its own rules for investigation and procedure to 
investigate complaints involving violations of this Act or any rules 
and regulations issued pursuant thereto, or any such other laws, rules 
and orders affecting the coconut industry; attribute or settle 
conflicting claims or render the appropriate decision or award 
including the imposition and administrative penalty of cancellation, 
revocation and suspension of license, registration, permit or clearance 
issued in accordance with this Act; 
4) Call upon or deputize any official or law enforcement agency of the 
government as may be necessary to assist the Authority in carrying 
out and enforcing its functions under this Act; 
5) Issue subpoena or subpoena duces tecum and/or subpoena ad testificandum 
to summon witnesses to appear in any investigation or hearing 
conducted by it; 
6) Enter into, make, conclude, perform, and carry out contracts of every 
kind and nature and for any lawful purpose which are necessary, 
proper or incidental to any business or purpose of the Authority; and 
7) Adopt, alter and use a corporate seal; to sue and be sued; and 
otherwise to do and perform all acts or exercise all powers and 
functions necessary or incidental to attain the national policy and 
objectives under this Act. 
ARTICLE III 
BOARD OF DIRECTORS AND OTHER PERSONNEL 
35 
SECTION 6. Board of Directors. - The corporate powers and duties of the 
36 
Authority shall be vested and exercised by a Board of Directors, hereinafter referred 
37 
to as the Board, composed of seven members to be appointed by the President, 
38 
three of whom shall represent the coconut farmer sector, one (1) from the trading 
39 
and processing sector, one (1) from the science and research sector, and two (2) 
40 
from the government sector. The Chairman shall be designated by the President 
41 
from among the members appointed. in his absence, the chairman may designate 
42 
any member of the board to preside during the meeting. 
43 
44 
SECTION 7. Tenure. - The members of the Board shall hold office for a term of 
45 
six (6) years or until their successors shall have been appointed and qualified or 
.46 
unless sooner removed for cause. Appointment to vacant positions shall only be for 
47 
the unexpired term of the predecessor. 
48 
49 
SECTION 8. Powers and Functions. - The Board shall exercise the following 
50 
powers and functions: 
51 
52 
53 
54 
a) Formulate and adopt a national government plan for the coconut industry 
and promulgate the necessary rules and regulations, policies and measures 
in support of the plan; 
-6-


1 
2 
3 
4 
b) Prescribe the organization of the Authority and fix the compensation and 
allowances of all its personnel in accordance with law; 
5 
c) Reorganize the Authority when there is a need to institute reforms in the 
6 
organizational structure to effect economy and promote efficiency. For this 
7 
purpose, the Board may group, coordinate, consolidate or integrate 
8 
positions and create, reclassify, split and abolish positions; 
9 
10 
d) Adopt, promulgate or amend, revise, modify or repeal rules and regulations 
11 
necessary to implement the provisions of this Act; 
12 
13 
e) Appoint the Administrator and deputy administrators and other officers 
14 
upon the recommendation of the Chairman and Chief Executive Officer; 
15 
16 
f) Approve the annual budget and such supplemental budgets of the 
17 
Authority; 
18 
19 
20 
21 
22 
23 
24 
g) Review, revise, modify, increase or decrease the fees and assessment 
authorized to be collected in this Act as current industry condition may 
warrant taking into account public interest, cost of services and the prices of 
coconut products and by-products, and oil palm products and by-products; 
and 
25 
h) Perform such other duties as may be assigned to it by the President of the 
26 
Philippines, consistent with this act. 
27 
28 
SECTION 9. Quorum and Meeting. - The Board shall meet as often as the 
29 
exigency of the service may demand. The presence of at least four (4) members 
30 
shall constitute a quorum and the vote of a majority of the members present 
31 
constituting a quorum shall be necessary for the adoption of any rule, resolution, 
32 
decision or any other act of the Board. 
33 
34 
SECTION 10. Compensation. - The members of the Board shall each receive per 
35 
diems for every committee and board meetings actually attended in accordance with 
36 
existing rules and regulations: Provided, however, That the total per diem collected 
37 
each month shall not exceed the equivalent per diem for four (4) committee/board 
38 
meetings. Unless and until the President of the Philippines has fixed a higher per 
39 
diem for the members of the Board, such per diem shall not be more than six 
40 
thousand for every committee / board meeting. 
41 
42 
SECTION 11. Officers and Personnel. - The Chairman of the Board, who shall 
43 
have the rank and privileges of a Department Secretary, shall be the head and Chief 
44 
Executive Officer of the Authority. Upon his recommendation, the Board shall 
45 
appoint an Administrator of the Authority who shall be the Chief Operating 
46 
Officer, with the rank and privileges of a Department Undersecretary. The 
47 
. Administrator shall have the responsibility of managing the day-to-day affairs and 
48 
operations of the Authority subject to the supervision and control of the Chief 
49 
Executive Officer and in accordance with the policies established by the Board. 
50 
51 
The Administrator shall have a term of six (6) years unless sooner removed. 
52 
53 
There shall be such sufficient number of deputy administrators as the Board 
54 
may prescribe to assist the Administrator who shall be appointed or removed for 
- 7 -


1 
cause by the Board. The Administrator and the deputy administrator may be 
2 
assigned with such powers and duties as the Chairman and Chief Executive Officer 
3 
may prescribe from time to time. 
4 
5 
SECTION 12. Application of the Civil Service Law. - All officers and 
6 
employees of the Authority shall be subject to the civil service laws, rules and 
7 
regulations, and all selection and appointments shall be based on merit and fitness. 
8 
9 
ARTICLE IV 
10 
MANAGEMENT AND OPERATIONS 
11 
12 
SECTION 13. Management. - The management of the corporate affairs of the 
13 
Authority shall be the responsibility of the Chief Executive Officer with the 
14 
assistance of the Administrator, deputy administrator for planning and such other 
15 
officers as may be determined by the Board. 
16 
17 
SECTION 14. Duties of the Chief Executive Officer. - The Chief Executive 
18 
Officer shall exercise the following duties and responsibilities: 
19 
20 
21 
a) Initiate and develop corporate policies, programs and objectives for 
approval of the Board; 
22 
23 
b) Establish general administrative and operating policies; 
24 
25 
c) Appoint all other non-officer employees of the Authority; 
26 
27 
d) Execute for and in behalf of the Authority contracts, obligations and 
28 
agreements which are required to be approved by the Board; 
29 
30 
e) Appoint technical consultants; 
31 
32 
f) Discipline officers and employees in accordance with civil service laws, 
33 
rules and regulations; 
34 
35 
g) Submit the internal organizational structure of the Authority, financial 
36 
statements and other reports as may be required by the Board; 
37 
38 
h) Delegate or assign any of the foregoing powers and duties except the power 
39 
to appoint any official in the hierarchy of authority and always subject to 
40 
his supervision and control; and 
41 
42 
i) Exercise such other powers and duties as may be assigned by the Board. 
43 
44 
SECTION 15. Corporate Planning Office. - To assist the Chief Executive Officer 
45 
in the formulation of general plans and programs, promulgation of policies, the 
46 
monitoring and evaluation of industry and corporate activities, there shall be a 
47 
Corporate Planning Office which shall serve as the technical arm under the office of 
48 
the Chairman, having the status of a branch which shall be headed by director for 
49 
corporate planning with a rank of deputy administrator. The term of the director 
50 
for corporate planning shall be co-terminus with the Chairman. 
51 
52 
SECTION 16. Duties of the Chief Operating Officer. - The Chief Operating 
53 
Officer shall exercise the following duties and responsibilities: 
54 
- 8 -


1 
2 
3 
a) Ensure that the administrative and operating policies are carried out under 
the direction and control of the Chairman and Chief Executive Officer; 
4 
b) Prepare and submit to the Chief Executive Officer, within sixty (60) days 
5 
before the beginning of each calendar year, an annual operational budget of 
6 
the Authority; and 
7 
8 
c) Monitor operational problems, adopt remedial =easures and sub=it policy 
9 
proposals to improve the day-to-day affairs and operations of the 
10 
Authority. 
11 
12 
d) perform other duties and functions as may be assigned by the chairman of 
13 
the board. 
14 
15 
SECTION 17. Branch Offices. - The Authority shall have the following 
16 
branches: 
17 
18 
a) Agricultural and Industrial Research and Development Branch for the 
19 
execution and implementation of systematic, unified, and credible research 
20 
and development policies, plans and programs on coconut production, 
21 
utilization, propagation, and related technologies as guided by principles of 
22 
scientific excellence and professionalism including the implementation of 
23 
policies, plans and programs relating to advancement in industrialization 
24 
and development for the coconut products and by products, and oil palm 
25 
products and by-products particularly on food, oleo-chemicals, fuels and 
26 
lubricants; 
27 
28 
b) Market 
Research and Development Branch for the formulation and 
29 
implementation of policies, plans and programs relating to domestic and 
30 
international markets development affecting the coconut industry including 
31 
the enforcement of market rules and regulations formulated by the 
32 
Authority; 
33 
34 
c) Field Operations Branch for execution and implementation of policies, plans 
35 
and programs relating to production, marketing and processing activities; 
36 
37 
d) Administration and Finance Branch for developing and maintaining the 
38 
delivery of all necessary administrative, financial and manpower support 
39 
for the whole operations of the AuthOrity; and 
40 
41 
e) Development Information and Communication Branch for the execution and 
42 
implementation of policies, plans and programs relating to development 
43 
information and communication as well as other socio economic research 
44 
and development. 
45 
46 
Every branch shall be headed by a deputy administrator or such qualified 
47 
acting or officer in charge as may be designated by the Chief Executive 
48 
Officer. 
49 
50 
SECTION 18. Regional Offices. - The Authority shall establish and organize 
51 
regional offices in coconut producing areas in the country in accordance with the 
52 
political and administrative regions in the country and such number of provincial 
53 
or district offices, or both, that will assist the Authority in the full implementation 
54 
of this Act. 
- 9 -


1 
2 
SECTION 19. Departments, Divisions and Units. -There shall be organized 
3 
such specialized departments, divisions, units or offices as may be necessary to 
4 
provide the needed administrative, technical and specialized services, as may be 
5 
deemed proper and expedient by the Board, which shall be headed by a person 
6 
with the required specialization or expertise as prescribed in the qualification 
7 
standard for the position or function. 
8 
9 
ARTICLE V 
10 
SOURCES OF FUNDING 
11 
12 
SECTION 20. Coconut Development Fund. - There is hereby established a 
13 
national coconut development fund to be administered by the authority for the 
14 
purpose of financing the growth and development of the coconut industry, including 
15 
human resource development, training of farmers and other related activities. The 
16 
sum necessary for the establishment of the fund is hereby authorized to be 
17 
appropriated in the General Appropriations Acts of the years following its enactment 
18 
into law. 
19 
20 
21 
22 
SECTION 21. Other Sources of Funding. - In the event the fund as provided in 
23 
Sections 20 of this Act become insufficient, an amount shall be appropriated from 
24 
the following sources: 
25 
26 
a) The proceeds of loans which the Authority may obtain from financial 
27 
institutions: Provided, That should the total outstanding proceeds shall at 
28 
anyone time exceed One Billion Pesos (Pl,OOO,OOO,OOO.OO), the transaction 
29 
shall be subject to the approval of the President; 
30 
31 
b) All other proceeds, income, and collections arising 
from transactions 
32 
authorized under this Act: Provided, That proceeds herein mentioned shall 
33 
be used to finance socio-economic, developmental, and research and 
34 
development programs and projects of the Authority; 
35 
'36 
c) The proceeds of the value-added tax imposed on all coconut products and 
37 
by-products; except copra, copra cake and meal which are hereby exempted 
38 
from payment of value added tax and on the services of coconut oil mills, 
39 
desiccated coconut factories and other processors of coconut products shall 
40 
be collected by the Bureau of Internal Revenue under Executive Order No. 
41 
·273, entitled "Adopting A Value-Added Tax, Amending For This Purpose Certain 
42 
Provisions Of the National Internal Revenue Code, And For Other Purposes,": 
43 
Provided, That such proceeds of the value added tax shall be deposited with 
44 
the Treasurer of the Philippines within the first ten (10) days of each quarter 
45 
and shall be automatically appropriated to finance the programs and 
46 
projects of the Authority; 
47 
48 
49 
ARTICLE VI 
50 
REGISTRATION, LICENSE, PERMITS 
51 
52 
SECTION 22. Application for Registration. - Any person directly or indirectly 
53 
engaged in the manufacture, processing, and other business involving coconut 
54 
products' and by-products, and other oil palm products and by-products to be 
- 10 -


1 
. determined by the Authority pursuant to its rules and regulations shall apply for 
2 
registration with the Authority. 
3 
4 
SECTION 23. License to Operate. -
Upon approval of application for 
5 
registration, the Authority shall issue the corresponding license to operate under 
6 
such rules and regulations promulgated for the purpose. The application for 
7 
registration and license shall be mandatory for both the principal and his agents in 
8 
the case of natural persons, and the central or main offices and their branches or 
9 
subsidiaries in the case of juridical persons. 
10 
ARTICLE VII 
11 
COMMODITY SUPERVISION 
12 
13 
SECTION 24. Application for Export Clearance. -
Notwithstanding any 
14 
provision of law to the contrary, all exporters of copra, coconut oil, desiccated 
15 
coconut, copra cake or meal, and other coconut products and by-products shall file 
16 
with the Authority, not later than ten (10) days prior to the date of loading, an 
17 
application for export clearance pursuant to such forms prescribed by the Authority 
18 
under its implementing rules and regulations. 
19 
20 
SECTION 25. Use of Moisture Meter. - For an accurate determination of 
21 
moisture content in the copra resecada, and in observation of the standard scale for 
22 
moisture content established by the Authority, all persons or firms engaged in the 
23 
business involving copra shall use moisture meters duly calibrated, serialized and 
24 
sealed by the Authority or any duly authorized office. 
25 
26 
SECTION 26. Fees. - The Authority shall collect in addition to the fees for the 
27 
issuance, renewal or replacement of license and registration such reasonable fees to 
28 
cover the cost of services under this Act. 
29 
30 
ARTICLE VIII 
31 
INCENTIVES 
32 
33 
SECTION 27. Tax Incentives. -The coconut industry, its institutions, members 
34 
and participants shall be entitled to all tax and non-tax incentives under existing 
35 
applicable laws, decrees, executive orders and similar issuances. 
36 
37 
SECTION 28. Tax Exemption. - Notwithstanding the provisions of any law to 
38 
the contrary, all real properties, equipment and machinery acquired by the 
39 
Authority for its operations under this Act shall be exempt from all taxes, fees, 
40 
duties, imposts and assessments, both national and local except income tax. 
41 
42 
ARTICLE IX 
43 
SPECIAL PROVISIONS 
44 
45 
SECTION 29. Conservation of Coconut Trees. - In order to conserve and 
46 
protect the resources devoted to coconut industry, the Authority shall regulate the 
47 
cutting or destruction of coconut trees in accordance with the provisions of 
48 
Republic Act 8048, otherwise known as the Coconut Preservation Act of 1995, 
49 
including all amendments thereto on the date this Act takes effect and to execute 
50 
and enforce the police powers granted under this Act. 
51 
52 
SECTION 30. Measures to Protect the Industry. - When the general welfare of 
53 
the industry for national interest so requires, and when there exist unabated 
54 
increase in production capacity resulting, singly or colledively, in cutthroat 
- 11 -


1 
competition, overproduction, underselling, and smuggling of poor quality coconut 
2 
products and by-products, or oil palm products and by-products, thereby 
3 
threatening the viability and stability of the coconut industry or any sector thereof, 
4 
the Authority shall regulate or otherwise suspend the issuance of license for the 
5 
establishment and operation of any new coconut oil mill, desiccated coconut plant 
6 
or refinery or the upgrading of capacities of existing mill, plant or refinery. In 
7 
granting the license, the Authority shall evaluate and determine the need for the 
8 
establishment of additional mills or plant or upgrading the capacity of any existing 
9 
mills or plant in relation to: 
10 
11 
a) The existing market demand; 
12 
13 
b) The production capacity prevailing in the country, locally or any sector of 
14 
the industry; 
15 
16 
c) The level and flow of supply or raw materials; and 
17 
18 
19 
20 
d) Such other circumstances which may affect the viability or stability of the 
industry concerned. 
21 
ARTICLE X 
22 
PEN AL TIES 
23 
24 
SECTION 31. Penalties. - Any person who wilfully or deliberately violates any 
25 
of the provisions of this Act or rules or regulations duly promulgated hereunder 
26 
shall be punished by a fine of not less than two hundred thousand pesos 
27 
(P200,OOO.OO), or by imprisonment of not more than five (5) years, or both: Provided, 
28 
That should the violation constitute an act punishable under the Revised Penal 
29 
Code, the pertinent provision and penalty prescribed in the said Code shall apply. 
30 
31 
If the violation be committed by an association, partnership, corporation or any 
32 
juridical person, the officer or officers, director or employee responsible for the 
33 
violation shall be held liable and shall suffer the penalties provided herein. An alien 
34 
found guilty shall after having served his sentence be immediately deported and in 
35 
case of a naturalized citizen, his Certificate of Naturalization shall be cancelled. -
36 
37 
SECTION 32. Interest and Charges. - Assessment and regulatory or service fees 
38 
or charges which are not paid on the due date thereof shall be subject to penalty 
39 
interest of fourteen (14%) percent per annum. In addition thereto, a surcharge of 
40 
twenty five (25%) percent shall be imposed in case of wilful or fraudulent failure to 
41 
pay as determined by the court in a case filed therefor. 
42 
43 
ARTICLE XI 
44 
TRANSITORY PROVISION 
45 
46 
SECTION 33. 
Implementing Rules and Regnlations. - The PHILCIDA is 
47 
hereby given full power and authority to promulgate such rules and regulations it 
48 
may deem proper and necessary for the effective implementation of this Act. 
49 
50 
SECTION 34. 
Abolition. 
- The Philippine Coconut Authority is hereby 
51 
abolished and its powers and functions transferred to the Philippine Coconut 
52 
. Industry Development Authority together with all the appropriations and funding 
53 
from all sources, including all its obligations, equipment and other assets and such 
54 
personnel as are necessary: Provided, That as a result or incident of the abolition, 
- 12 -


1 
no personnel shall be terminated or separated except when the Board shall exercise 
2 
its authority to reorganize pursuant to Article III, Section 8 of this Act: Provided 
3 
further, That displaced personnel as a result of the abolition shall be given 
4 
compensation eqUivalent to twice their present salary for every year of government 
5 
service: Provide furthermore, that the Authority through the Board, shall effect the 
6 
transfer of absorbed personnel in a manner that will ensure the least disruption of 
7 
on-going programs and projects: Provided finally, that until such reorganization is 
8 
implemented, all officers and employees of the abolished agency shall continue all 
9 
functions and discharge all their duties and responsibilities. 
10 
11 
ARTICLE XII 
12 
MISCELLANEOUS 
l3 
14 
SECTION 35. Separability Clause. - If any part or provision of this Act is 
15 
declared unconstitutional, other parts or provisions thereof which are not affected 
16 
thereby shall continue to be in full force and effect. 
17 
18 
SECTION 36. Repealing Clause. - All laws, decrees, executive orders, rules and 
19 
regulations and other issuances or parts thereof, inconsistent with the provisions of 
20 
this Act, are hereby repealed or modified accordingly. 
21 
22 
SECTION 37. EffectiVity. - This Act shall take effect fifteen (15) days after its 
23 
publication in at least two (2) national newspapers of general circulation. 
24 
25 
Approved, 
- l3 -