1
Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City, Metro Manila 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ____ 
Introduced by CIBAC Party-List Representative 
Hon. EDUARDO “BRO. EDDIE” C. VILLANUEVA 
AN ACT  
PROVIDING FOR SUPPORT FOR THE GROWTH AND 
DEVELOPMENT OF BARANGAY MICRO BUSINESS ENTERPRISES 
AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 9178, 
OTHERWISE KNOWN AS THE BARANGAY MICRO BUSINESS 
ENTERPRISES ACT OF 2002, AND FOR OTHER PURPOSES 
EXPLANATORY NOTE 
Micro Business comprise a large number of all existing enterprises 
in the Philippines. According to the Philippine Statistics Authority List of 
Establishments, there are 977,670 micro-enterprises in the country in 
2021, constituting 90.5% of all business enterprises in the country.1 They 
also generate a total of over 2.5 million jobs.2  
Republic Act No. 9178 or the Barangay Micro Business Enterprises 
Act of 2002, declared it the policy of the state to hasten the country's 
economic development by encouraging the formation and growth of 
barangay micro business enterprises (BMBEs) which effectively serve as 
seedbeds of Filipino entrepreneurial talents. The law recognizes this 
sector's role in economic growth and employment and ensures that 
establishments registered as BMBEs are provided with certain incentives 
1 January 6, 2022. More than 1.08 million Establishments Operated in 2021 which Generated Total Employment of 8.57 million 
(2021 Updating of the List of Establishments Preliminary Results). Retrieved from: https://psa.gov.ph/content/more-108-million-
establishments-operated-2021-which-generated-total-employment-857-million (date last accessed: August 30, 2022). 
2 2020 MSME Statistics Retrieved from: https://www.dti.gov.ph/resources/msme-statistics/ (date last accessed: August 30, 2022) 
November 7, 2022
8:05 am
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such, as among others, tax exemptions, exemptions from the Minimum 
Wage Law, and priority lanes/windows for credit facilities with financial 
institutions.3   Despite these incentives, a relatively small number of micro 
businesses are registered as BMBEs.  Based on the latest report of the 
Department of Trade and Industry (DTI) in 2018, there were only 28,531 
businesses registered as BMBE since the DTI started accepting 
applications in January of 2016.4  
 
Thus, a revisit of Republic Act No. 9178 is needed to ensure that its 
provisions are still relevant and reflect the present needs of the BMBE 
industry. Currently, BMBEs are still recovering from the effects of the 
pandemic and are still enduring further business shocks as a result of 
natural calamities, such as typhoons, and global economic events, such 
as the Russia-Ukraine conflict, unprecedented global inflation and rising 
fuel prices. Thus, amendments to the law, which aim to provide BMBEs 
with much needed support, concessions and incentives to register, are in 
order. 
 
In view of the foregoing, the immediate passage of this bill is 
earnestly sought.  
 
 
 
HON. EDUARDO “BRO. EDDIE” C. VILLANUEVA 
 
 
 
 
 
 
 
 
 
 
 
 
 
3 CL registers highest number of barangay enterprises in 2017. Retrieved from: https://www.dti.gov.ph/regions/region-3/region-
3-news/cl-registers-highest-number-of-barangay-enterprises-in-2017/ (date last accessed: August 30, 2022). 
4 May 18, 2018. DTI encourages micro enterprises to avail of incentives under BMBE Law. Retrieved from: 
https://www.dti.gov.ph/archives/news-archives/dti-micro-entrep-bmbe-law/ (date last accessed: August 30, 2022) 
 


3
Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City, Metro Manila 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ____ 
Introduced by CIBAC Party-List Representative 
HON. EDUARDO “BRO. EDDIE” C. VILLANUEVA 
AN ACT  
PROVIDING FOR SUPPORT FOR THE GROWTH AND 
DEVELOPMENT OF BARANGAY MICRO BUSINESS ENTERPRISES 
AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 9178, 
OTHERWISE KNOWN AS THE BARANGAY MICRO BUSINESS 
ENTERPRISES ACT OF 2002, AND FOR OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the 
1 
Philippines in Congress assembled:    
2 
3 
SECTION 1.  Section 2 of Republic Act No. 9178, otherwise known 
4 
as the “Barangay Micro Business Enterprises Act of 2002” is hereby 
5 
amended to read as follows:   
6 
7 
Section 2. Declaration of Policy. – [It is hereby declared to be the 
8 
policy of the State to hasten the country’s economic development 
9 
by encouraging the formation and growth of barangay micro 
10 
business enterprises which effectively serve as seedbeds of Filipino 
11 
entrepreneurial talents, and integrating those in the informal sector 
12 
with the mainstream economy, through the rationalization of 
13 
bureaucratic restrictions, the active intervention of the government 
14 
specially in the local level, and the granting of incentives and 
15 
benefits to generate much-needed employment and alleviate 
16 
poverty.] THE STATE RECOGNIZES THAT BARANGAY MICRO 
17 
BUSINESS ENTERPRISES (BMBEs), WHILE THE SMALLEST 
18 
TYPE OF ALL ENTERPRISES, IS AMONG THE SIGNIFICANT 
19 
ESTABLISHMENTS IN THE COUNTRY, AND IS ONE OF THE 
20 
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BIGGEST GENERATORS OF EMPLOYMENT. THUS, IT IS 
1 
HEREBY DECLARED THE POLICY OF THE STATE TO 
2 
SUPPORT, STRENGTHEN AND FACILITATE THE GROWTH OF 
3 
BMBEs TO HELP THIS SECTOR CONTINUE TO FLOURISH 
4 
AMIDST 
PUBLIC 
HEALTH 
EMERGENCIES, 
NATURAL 
5 
CALAMITIES AND GLOBAL ECONOMIC SHOCKS.  
6 
 
7 
 
SEC. 2. Section 4 of the Barangay Micro Business Enterprises Act 
8 
of 2002 is hereby amended to read as follows:  
9 
 
10 
Section 4. Registration and Fees. – The Office of the Treasurer of 
11 
each city or municipality shall register [the BMBE's] and 
12 
PROMPTLY issue a Certificate of Authority, FREE OF CHARGE, 
13 
TO ALL BMBES WITHIN ITS JURISDICTION UPON SUBMISSION 
14 
OF PROOF OF TOTAL ASSETS, to enable the BMBE to avail of 
15 
the benefits under this Act. Any such application shall be processed 
16 
NOT LATER THAN FIVE [within fifteen (15)] working days upon 
17 
submission of complete documents. Otherwise, the BMBEs shall be 
18 
deemed registered. The Municipal or City Mayor may appoint a 
19 
BMBE Registration Officer who shall be under the Office of the 
20 
Treasurer. Local government units (LGUs) are encouraged to 
21 
establish a One-Stop-Business Registration Center to handle the 
22 
efficient registration and processing of permits/licenses of BMBEs. 
23 
Likewise, LGUs shall make a periodic evaluation of the BMBEs’ 
24 
financial status, AS WELL AS THE NUMBER OF JOBS IT 
25 
GENERATES, for monitoring and reporting purposes.  
26 
 
27 
[The LGUs shall issue the Certificate of Authority promptly and free 
28 
of charge. However,] NOTWITHSTANDING ANYTHING TO THE 
29 
CONTRARY, to defray the administrative costs of registering and 
30 
monitoring the BMBEs, the LGUs may charge a fee not exceeding 
31 
One Thousand Pesos (P1,000.00). 
32 
 
33 
The Certificate of Authority shall be effective for a period of THREE 
34 
(3) [two (2)] years, renewable for aNOTHER [period of] THREE (3) 
35 
YEARS [two (2)] UPON [years for every renewal.] COMPLIANCE 
36 
WITH THE REQUIREMENTS.  
37 
 
38 
[As much as possible,] IN ALL CASES, BMBEs shall be subject to 
39 
minimal bureaucratic requirements and reasonable fees and 
40 
charges. 
41 
SEC. 3. Section 5 of the Barangay Micro Business Enterprises Act 
42 
of 2002 is hereby amended to read as follows: 
43 


 
5
 
1 
Section 5. Who are Eligible to Register. – Any person, natural or 
2 
juridical, or cooperative, or association, having the qualifications as 
3 
defined in Section 3(a) hereof may apply for registration as BMBE. 
4 
EACH LGU SHALL MAINTAIN AND CONTINUOUSLY UPDATE A 
5 
DATABASE CONTAINING ALL REGISTERED BMBEs UNDER ITS 
6 
JURISDICTION. 
7 
 
8 
SEC. 4. Section 7 of the Barangay Micro Business Enterprises Act 
9 
of 2002 is hereby amended to read as follows: 
10 
 
11 
Section 7. Exemption from Taxes and Fees. – All BMBEs shall be 
12 
exempt from tax for income arising from the operations of the 
13 
enterprise. FIRST TIME BMBE REGISTRANTS SHALL, IN 
14 
ADDITION, BE EXEMPT FROM LOCAL TAXES, FEES AND 
15 
CHARGES FOR THE FIRST THREE (3) YEARS OF OPERATION  
16 
SUBJECT TO SEMI-ANNUAL SUBMISSION OF PROOF OF 
17 
EMPLOYMENT GENERATED IN THE LOCALITY. 
18 
 
19 
[The LGUs are encouraged either to reduce the amount of local 
20 
taxes, fees and charges imposed or to exempt BMBEs from local 
21 
taxes, fees and charges.] 
22 
 
23 
SEC. 5. Section 9 of Barangay Micro Business Enterprises Act of 
24 
2002 is hereby amended to read as follows: 
25 
 
26 
Section 9. Credit Delivery – Upon the approval of this Act, the Land 
27 
Bank of the Philippines (LBP), the Development Bank of the 
28 
Philippines (DBP), the SMALL BUSINESS CORPORATION (SB 
29 
CORPORATION) [Small Business Guarantee and Finance 
30 
Corporation (SBGFC)], and the People's Credit and Finance 
31 
Corporation (PCFC) shall set up a special credit window that will 
32 
service the financing needs of BMBEs registered under this Act 
33 
consistent with the Bangko Sentral ng Pilipinas (BSP) policies; rules 
34 
and regulations. The Government Service Insurance System (GSIS) 
35 
and Social Security System (SSS) shall likewise set up a special 
36 
credit window that will serve the financing needs of their respective 
37 
members who wish to establish a BMBE. The concerned financial 
38 
institutions (FIs) encouraged to wholesale the funds to accredited 
39 
private 
financial 
institutions 
including 
community-based 
40 
organizations such as credit, cooperatives, non-government 
41 
organizations (NGOs) and people's organizations, which will in turn, 
42 
directly provide credit support to BMBEs. 
43 


 
6
 
1 
All loans from whatever sources granted to BMBEs under this Act 
2 
shall be considered as part of [alternative] THE OTHER MODES OF 
3 
compliance to [Presidential Decree No. 717, otherwise known as the 
4 
Agri-Agra Law,] REPUBLIC ACT NO. 11901, OTHERWISE 
5 
KNOWN AS THE AGRICULTURE, FISHERIES, AND RUAL 
6 
DEVELOPMENT FINANCING ACT OF 2022, AND SUCH OTHER 
7 
APPLICABLE LAW PROVIDING A LIMIT FOR LOANS GRANTED 
8 
TO MICRO, SMALL AND MEDIUM ENTERPRISES (MSMES) [, or 
9 
to Republic Act. No. 6977, known as the Magna Carta for Small and 
10 
Medium Enterprises, as amended]. For purposes of compliance with 
11 
THE FOREGOING LAWS, [Presidential Decree No. 717 and 
12 
Republic Act No. 6977, as amended,] loans granted to BMBEs 
13 
under this Act shall be computed at TWO AND A HALF TIMES (2.5) 
14 
[twice] the amount of the face value of the loans.  
15 
 
16 
To minimize the risks in lending to the BMBEs, THE PHILIPPINE 
17 
GUARANTEE CORPORATION (PHILGUARANTEE) [SBGFC and 
18 
the 
Quedan 
and 
Rural 
Credit 
Guarantee 
Corporation 
19 
(QUEDANCOR) under the Department of Agriculture, in case of 
20 
agribusiness activities,] shall set up a special guarantee window to 
21 
provide the necessary credit guarantee to BMBEs under their 
22 
respective guarantee programs.  
23 
 
24 
The 
LBP, 
DBP, 
PCFC, 
[SBGFC] 
SB 
CORPORATION, 
25 
PHILGUARANTEE,  SSS, AND GSIS[, and QUEDANCOR] shall 
26 
annually report to the appropriate Committee of both Houses of 
27 
Congress on the status of the implementation of this provision. 
28 
 
29 
The BSP shall formulate the rules for the implementation of this 
30 
provision and shall likewise establish incentive programs to 
31 
encourage and improve credit delivery to the BMBEs. 
32 
 
33 
TO FACILITATE THE GROWTH AND RECOVERY OF BMBEs, A 
34 
BMBE REGISTERED UNDER THIS ACT SHALL BE ENTITLED TO 
35 
INTEREST-FREE LOANS FROM THE CREDIT WINDOW OF THE 
36 
LBP, DBP, SMALL BUSINESS CORPORATION AND PCFC; 
37 
PROVIDED, THAT THE LOAN AMOUNT SHALL (I) NOT EXCEED 
38 
ONE MILLION PESOS (P1,000,000.00), (II) NOT REQUIRE A 
39 
COLLATERAL, AND (III) BE PAYABLE UP TO THREE (3) YEARS; 
40 
PROVIDED, FURTHER, THAT IN THE EVENT THAT SUCH LOAN 
41 
IS 
GRANTED 
TO 
ACCREDITED 
PRIVATE 
FINANCIAL 
42 
INSTITUTIONS, 
INCLUDING 
COMMUNITY 
BASED 
43 


 
7
ORGANIZATIONS SUCH AS COOPERATIVES, NGOS AND 
1 
PEOPLE’S ORGANIZATIONS ENGAGED IN GRANTING CREDIT, 
2 
THAT IN TURN RELEND SUCH AMOUNT TO BMBEs, ONLY THE 
3 
LOAN GRANTED TO THE BMBE SHALL BE INTEREST-FREE 
4 
AND ANY SUCH INTEREST FOREGONE BY THE PRIVATE 
5 
FINANCIAL INSTITUTION SHALL BE DEDUCTED FROM THE 
6 
INTEREST DUE ON ITS LOAN PROVIDED BY THE CONCERNED 
7 
GOVERNMENT FINANCIAL INSTITUTION; PROVIDED, FINALLY, 
8 
THAT IN ORDER TO PROPERLY IMPLEMENT THE PROVISION 
9 
OF THIS SECTION, AN AMOUNT OF FIVE HUNDRED MILLION 
10 
PESOS (P500,0000,000) SHALL BE APPROPRIATED TO 
11 
ANSWER FOR THE INTEREST SUBSIDY PROVIDED UNDER 
12 
THIS ACT.  
13 
 
14 
SEC. 6. Section 10 of the Barangay Micro Business Enterprises Act 
15 
of 2002 is hereby amended to read as follows: 
16 
 
17 
Section 10. Technology Transfer, Production and Management 
18 
Training, and marketing Assistance. –  
19 
 
20 
x x x 
21 
 
22 
The Department of Trade and Industry (DTI), the Department of 
23 
Science and Technology (DOST), the University of the Philippines 
24 
Institute for Small Scale Industries (UP ISSI), Cooperative 
25 
Development Authority (CDA), AND Technical Education and Skills 
26 
Development Authority (TESDA)[, and Technology and Livelihood 
27 
Resource Center (TLRC)] may avail of the said Fund for technology 
28 
transfer, production and management training and marketing 
29 
assistance to BMBEs. 
30 
 
31 
The DTI, in coordination with the private sector and non-government 
32 
organization (NGOs), shall explore the possibilities of linking or 
33 
matching-up BMBEs with small, medium and large enterprises and 
34 
likewise 
establish 
incentives 
therefor. 
THE 
DTI, 
IN 
35 
COORDINATION WITH THE DEPARTMENT OF INTERIOR AND 
36 
LOCAL GOVERNMENT (DILG), SHALL ENACT PROGRAMS 
37 
THAT PROVIDE BMBEs WITH MARKETING ASSISTANCE, SUCH 
38 
AS, BUT NOT LIMITED, TO BUSINESS MATCHING ACTIVITIES, 
39 
TRADE FAIRS, OVERSEAS MARKETING PROMOTIONS, AND 
40 
BUSINESS 
DEVELOPMENT 
ACTIVITIES, 
INCLUDING 
41 
ENTREPRENEURSHIP AND SKILLS DEVELOPMENT, AND 
42 
OTHER RELATED ACTIVITIES. 
43 


 
8
 
1 
THE DEPARTMENT OF SCIENCE AND TECHNOLOGY (DOST), 
2 
IN COORDINATION WITH THE DILG AND OTHER RELEVANT 
3 
GOVERNMENT 
AGENCIES, 
SHALL 
ALSO 
IMPLEMENT 
4 
PROGRAMS GEARED TOWARDS PROVIDING BMBEs WITH 
5 
APPROPRIATE TECHNOLOGY INTERVENTIONS WHICH CAN 
6 
HELP 
IMPROVE 
THEIR 
PRODUCTION 
PROCESSES, 
7 
ACCOUNTING SYSTEMS, AND OTHER AREAS OF BUSINESS 
8 
OPERATIONS. 
9 
 
10 
The DTI, in behalf of the DOST, UP ISSI, CDA, AND TESDA [and 
11 
TLRC] shall be required to furnish the appropriate Committees of 
12 
both Houses of Congress a yearly report on the development and 
13 
accomplishments of their projects and programs in relation to 
14 
technology transfer, production and management training and 
15 
marketing assistance extended to BMBEs. 
16 
 
17 
SEC. 7. A new Section 10-A is hereby inserted to read as follows: 
18 
 
19 
SEC. 10-A. BMBE EDUCATION AND TRAINING. – THE DTI, IN 
20 
COORDINATION WITH THE DEPARTMENT OF EDUCATION 
21 
(DEPED), 
TECHNICAL 
EDUCATION 
AND 
SKILLS 
22 
DEVELOPMENT AUTHORITY (TESDA), AND COMMISSION ON 
23 
HIGHER 
EDUCATION 
(CHED), 
SHALL 
PROVIDE 
FREE 
24 
TRAININGS, 
COURSES, 
AND 
OTHER 
DEVELOPMENT 
25 
PROGRAMS 
FOR 
OWNERS 
AND 
EMPLOYEES 
OF 
26 
REGISTERED 
BMBEs 
TO 
IMPROVE 
THEIR 
BUSINESS 
27 
PRACTICES AND TO ENABLE THEM TO INNOVATE IN LIGHT 
28 
OF RAPID TECHNOLOGICAL CHANGES.  
29 
 
30 
 
SEC. 8. Appropriations. – In addition to the amount provided under 
31 
Section 5 of this Act, amending Section 9 of the Barangay Micro Business 
32 
Enterprises Act of 2002, the sums necessary for the implementation of 
33 
this Act shall be charged against the responsible agency’s current 
34 
appropriations. Thereafter, such sums as necessary for the continued 
35 
implementation of this Act shall be included in the annual General 
36 
Appropriations Act.  
37 
 
38 
SEC. 9. Implementing Rules and Regulations. – Within sixty (60) 
39 
days from the effectivity of this Act, the DILG and DTI, upon consultation 
40 
with appropriate government agencies and other stakeholders, shall 
41 
promulgate the necessary rules and regulations to effectively implement 
42 
this Act. 
43 


 
9
 
1 
 
SEC. 10. Separability Clause. – Any portion or provision of this Act 
2 
that is declared unconstitutional or invalid shall not have the effect of 
3 
nullifying other portions or provisions hereof as long as such remaining 
4 
portions can still subsist and be given effect in their entirety. 
5 
 
6 
 
SEC. 11. Repealing Clause. – All laws, ordinances, rules, 
7 
regulations, other issuances, or parts thereof, which are inconsistent with 
8 
this Act, are hereby repealed or modified accordingly.  
9 
 
10 
SEC. 12. Effectivity. – This Act shall take effect fifteen (15) days 
11 
after its publication in the Official Gazette or in at least two (2) newspapers 
12 
of general circulation. 
13 
 
14 
  
Approved, 
15