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Republic of the Philippines
House of Representatives

Nineteenth Congress
First Regular Session

2331

House Bill No.

INTRODUCED BY REPRESENTATIVE ADRIAN MICHAEL A. AMATONG

EXPLANATORY NOTE

‘The demand for natural rubber in the world market is steadily progressing.
‘This is due to its characteristic properties such as high tensile strength, vibration
dampening, and tear resistance, making it ideal and more preferred than
synthetic rubber for its application in the automobile industry and in large
constructions. In fact, the global production of natural rubber is projected to
register a compound annual growth rate of 4.3% during the forecast period of
2021-2026.

Despite this growing global demand, the production of natural rubber and
rubber products of the Philippines declined continuously. In fact, the Philippines
only accounts for 1% of the share in the global rubber production in 2017, a far
cry compared to the rubber production of our ASEAN neighbors- Thailand (34%),
Indonesia (25%), Vietnam (9%) and Malaysia (6%). In addition, the Philippines’
exportation of natural rubber also experienced a drastic decline. From 405.99
million US dollars in 2012, it declined to 135.08 million US dollars in 2016.

‘The Philippines’ relatively low levels of rubber production, its uncompetitive
processing environment, and its quality control issues should be addressed to
catalyze the development of the rubber industry. A dependable supply of quality
natural rubber can provide downstream opportunities for manufacturing
industries with largest rubber consumption, such as automotive, healthcare, and
apparel or industrial sectors.

Thus, this bill seeks to establish the Philippine Rubber Industry
Development Board. The Board will be tasked to oversee and coordinate the
initiatives of government agencies, the private sector, the academe and other
concerned groups to spur rubber industry growth and development. Specifically,
the Board will evaluate the Philippine rubber industry performance, focusing on
issues and concerns, prospects, threats and opportunities, and other constraints
to growth, and identifying agencies that can best address the areas of concern
from the production/cultivation stage, to processing/manufacturing, trading and
market distribution of rubber and its allied products.


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°

It is noteworthy that this bill has been already filed by Cong. Isagani S.
Amatong in the 17 and 18% Congress as House Bills No. 2912 and 2664,
respectively. According to the Department of Science and Technology- Philippine
Council for Industry, Energy, and Emerging Technology Research and
Development (DOST-PCIEERD), these bills “should be given focus to promote
inclusive growth in the (rubber) industry.”! The passage of this bill is also
proposed as one of the major projects for implementation by the PhilRubber
Technical Working Group in its Philippine Rubber Industry Roadmap 2017-2022.

‘Thus, the timely passage of this bill is earnestly sought.

ADI A. AMATONG

“Strengthening the Philippine Rubber Industry Towards a Sustainable Economy”, DOST PCIEERD Policy

Brief


Ce Vanee ne

Republic of the Philippines
House of Representatives

Nineteenth Congress
First Regular Session

House Bill No. 2331

INTRODUCED BY REPRESENTATIVE ADRIAN MICHAEL A. AMATONG

AN ACT
TO DEVELOP THE RUBBER INDUSTRY, ESTABLISHING FOR THE
PURPOSE THE PHILIPPINE RUBBER INDUSTRY DEVELOPMENT
BOARD, DEFINING ITS POWERS AND FUNCTIONS,
AND APPROPRIATING FUNDS THEREFOR

Be it enacted by the Senate and House of Representatives of the Philippines in

Congress assembled:

SECTION 1. Short Title. This Act shall be known as the “Philippine Rubber

Industry Development Act.”

SEC. 2. Declaration of Policy. It is the policy of the State to establish a
strong foundation for more inclusive growth where it shall be easier for the
marginalized economic sectors to participate in economic progress through
job creation and encouragement of entrepreneurship. The government, in
partnership with the private sector, shall improve the productivity of
agriculture and enhance the global competitiveness of the industry and

services sectors.

Towards this end, the government, with the active support of the
private sector, shall endeavor to achieve a balanced, integrated, and
sustainable development of the country’s rubber industry, the Philippines
being frequently among the top 10 exporters of raw or semi-processed
rubber, and being favorably situated in Southeast Asia which accounts for
90% of the world’s output of natural rubber. The government shall
undertake to develop Philippine rubber as a major participant in the rubber


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global value chain by accelerating the industry’s overall growth through the
following: (a) Expanding and improving the productivity and quality of
natural rubber production for domestic and global markets; (b) Enhancing
the competitiveness of the processing and manufacturing of rubber and
rubber-based products, setting international quality control standards and
ensuring adherence thereat; (c) Encouraging diversification through product
upgrading which involves the production of better quality and higher valued
semi-processed rubber; and (d) Promoting public-private partnership to
push forward the programs and projects that will optimize natural and
manufactured rubber product utilization.

SEC. 3. Definition of Terms. As used in this Act, the following words or
phrases shall mean as follows:

(a) Natural rubber — means the latex of any rubber plant, whether fluid or
coagulated, in any stage which is processed and converted into rubber
and rubber-based products.

() Philippine Rubber Industry Development Roadmap - shall serve as a
guide to all industry stakeholders for optimal realization of the targets set
for the development of the rubber industry. It highlights the

accomplishments of the joint efforts and initiatives of all stakeholders,
and reflects the agreements on the areas where the efforts should be
focused for optimal results.

(c) Standard Philippine Rubber (SPR) - the technical specification of the
quality of Philippine semi-processed rubber as defined under PNS ISO
2000.

(d) Processor — means any person, natural or juridical who is engaged in
processing latex or cup lump into rubber sheets or crumb which is used
as input material for rubber and rubber-based products.

(c) Manufacturer - all entities engaged in the manufacture of any rubber or
rubber-based products.

(f) Value Chain - describes the full range of activities that firms and
workers do to bring a product or good or service from its conception to its

end use and beyond.


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SEC. 4. The Philippine Rubber Industry Development Board. To
effectively carry out the policy declared in this Act, the Philippine Rubber
Industry Development Board, hereinafter referred to as the Board, is hereby
created for the purpose of overseeing and coordinating the initiatives of
government agencies, the private sector, the academe and other concerned
agencies, geared to accelerate the overall development of the Philippine
rubber industry, enabling it to be a major participant in the rubber global
value chain, It shall be attached to the Department of Trade and Industry.

SEC. 5. Powers and Functions. The Board shall:

(a) Coordinate initiatives and efforts of each agency members of the Board
to achieve a holistic government approach to industry development,
collaborating with the private sector, the academe, and other related
institution or organization;

(b)

Coordinate, monitor and assess the implementation of the Philippine
Rubber Industry Development Roadmap and programs/projects being
carried out by various stakeholders vis-a-vis policy statements and/or
targets;

(c) Periodically review and evaluate the country’s rubber industry

performance, focusing on issues and problems, prospects, threats and
opportunities, growth constraints within the entire value chain.;

@

Facilitate provision of support to rubber farmers in terms of credit and
marketing facilities, farm expansion, farm mechanization, rehabilitation
and modernization, and adoption of best agricultural production

practices;

©)

Create an enabling environment to encourage investments in public and
private lands, corporate joint ventures in production, processing, and
manufacturing of rubber-based products;

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Formulate and recommend suitable incentives for enterprises in the

industry, provide ease in availing of such incentives;


(g) Mandate compliance with the Philippine National Standards on rubber
and rubber-based products through imposing, among others, a
mandatory testing of natural rubber during every stage of its production;

(h

Develop capability of the industry to produce high-value products that
are globally competitive through innovations on the use of rubber in
industries;

(i) Expand market access through targeted and focused promotions of
rubber and its allied industries through local and international business
matching missions and trade fairs;

() Establish industry performance database to include the Board’s existing
statistics/information and feedback mechanisms to policies and plans
specific to rubber industry in aid to effective decision-making;

(k) Serve as the point of contact among policy makers of the rubber and
related industries;

() Facilitate the national representation of the country in industry-related
cooperation and undertakings/conferences; and

(m) Exercise such other functions as may be necessary to carry out the

purpose of this Act.

SEC. 6. Composition. The Board shall be composed of the following:
(a) The Secretary of the Department of Trade and Industry (DTI) as
Chairperson
(b) The Secretary of the Department of Agriculture (DA) as Co-
Chairperson

Members:

(c) The Secretary of the Department of Science and Technology
(Dost);

(@ The Secretary of the Department of Agrarian Reform (DAR);

(c) The Secretary of the Department of Environment and Natural
Resources (DENR);

() The Secretary of the Department of the Interior and Local
Government (DILG);


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(g) The Secretary of the Department of Labor and Employment
(DOLE);

(h) The Director General of the Technical Education and Skills
Development Authority (TESDA);

(i) Mindanao Development Authority (MinDA);

(Two (2) representatives from the State Universities and Colleges
(SUCs) located in major Philippine rubber-producing regions;

(k) Two (2) representatives from Philippine Rubber Industries
Association, Inc. (PRIA), representing the midstream and downstream
sectors;

() Two (2) representatives from Philippine Rubber Farmers
Association, Inc. (PRFA), representing small holders;

(m) One (1) representative from the rubber cooperatives; and,

(n) One (1) representative from the corporate rubber farmers.

The two (2) representatives from PRIA and the representative from the
corporate rubber farmers shall be appointed by the President, upon the
recommendation of the DTI Secretary. The two (2) representatives from
PRFA and the representative from the rubber cooperatives shall be
appointed by the President, upon the recommendation of the DA Secretary.
‘They shall serve in the Board for three (3) years reckoned from the date of
appointment. The representative may be reappointed by the President for

another term.

The government representatives in the Board may designate their
respective permanent alternates who shall be officials next-in-rank to them

and their acts shall be considered the acts of their principals.

SEC. 7. Meeting of the Board — The Board shall meet once every quarter or
may be convened by the Chair for a special meeting, provided that a notice
of special meeting shall be issued one week prior to the meeting.


SEC. 8. Board Secretariat — The Secretariat, to be organized by the DTI

shall have the following duties and functions:

(a) Provide technical expertise and administrative support to the
Board;

(b) Maintain and update industry performance database; and,

(c) Collate and integrate all inputs to the Board’s yearly report on
the status of the country’s rubber industry.

SEC. 9. PHLRUBBER Technical Working Group (PRTWG). The PRTWG,
formed on 22 June 2012, is hereby retained. The TWG, composed of the
DTI- Regional Operations Group. Export Marketing Bureau, Board of
Investments, Philippine Accreditation Bureau, Bureau of Philippine
Standards, Bureau of Small and Medium Enterprise Development); DA
(Bureau of Plant Industry, Bureau of Agriculture and Fishery Standards,
Philippine Council for Agriculture and Fisheries, Agricultural Training
Institute, PRRI), DOST (Philippine Council for Industry, Energy, and
Emerging Technology Research and Development, Philippine Council for
Agriculture, Aquatic and Natural Resources Research and Development
Institute). TESDA, DENR-National Greening Program, DAR, PSA, private
sector and the academe, government financial institutions (GFls), and other
institutions, shall be responsible for assisting the Board in formulating and
implementing policies, roadmaps, programs, and projects for the overall
development of the natural rubber industry. Specifically, it shall: (a)
coordinate, monitor the implementation of, and update the Roadmap; and
(b) coordinate and monitor the activities of all members of the working group
with respect to the overall development of Philippine rubber industry.

SEC. 10. Annual Report. The Board shall submit to the President and to
both Houses of Congress a report providing a detailed status of the rubber
industry in the country, including the progress and impact of all relevant
government policies and programs, as well as activities of other concerned

stakeholders (i.¢., rubber industry associations, manufacturers).


SEC. 11. Implementing Rules and Regulations. Within sixty (60) days
from the date of the effectivity of this Act, the Board, in consultation with
other concerned agencies and sectors, shall promulgate the rules and

regulations for the proper implementation of this act.

SEC. 12. Funding. Such sums as may be necessary for the initial
implementation of this Act shall be sourced from the different cooperating
agencies involved therein. Thereafter, the succeeding appropriation in the
amount of Fifty Million Pesos (Php 50,000,000.00) shall be included in the
annual General Appropriations Act (GAA).

SEC. 13. Separability Clause. If any provision of this Act is declared
invalid or unconstitutional, the other provisions not affected by such

declaration shall remain in full force and effect.

SEC. 14. Repealing Clause. All laws, executive and administrative orders,
rules and regulations inconsistent with this Act are hereby repealed or

amended accordingly.

SEC.15. Effectivity. This Act shall take effect fifteen (15) days after its
publication in the Official Gazette or in two (2) newspapers of general
circulation.

Approved,