Republic of the Philippines -~EPRES

HOUSE OF REPRESENTATIVES y, 5 fu
Quezon Cit fx _ EN
neo, fS RECEWED “@\
SIXTEENTH CONGRESS yy, 26FEB 2014 ‘n)

First Regular Session

House BILL No. 4015

EXPLANATORY NOTE

First off, this bill aims to serve as the counterpart of Senate Bill 1028 authored by
Senator Bam Aquino believing as this humble author does in the timeliness and
urgency of a measure of this nature. It is popularly known as the “Go Negosyo Bill.”

The "Go Negosyo Act of 2013" seeks to strength the micro, small, and medium
enterprises (MSMEs) sector by providing it with better incentives and benefits,
granting more access to focused support for enhanced business performance,
Promoting support to key growth industries, and facilitating financing support
programs that are much needed for growth. Further, the Act promotes more
Participation from the private sector in the MSME Development Council

MSMEs, now more than ever, have an important socioeconomic role in our nation’s
machinery. Unemployment numbers are growing, and we have to realize that
allocating effort and resources towards a strong and thriving MSME sector not only
sustains, but also leads to the creation of considerable and promising net
employment.

If unemployment is to be addressed head-on, then it behooves Congress to pass this
Act. Improvement of the design and implementation of the nation's MSME sector is
in direct proportion to improvement of the nation’s employment rate.

This Act has the potential to assist MSMEs to integrate themselveg in the formal
economic market, which will bring forth more job opportunities and the growth of our
nation’s economy.

The approval and passage of this bill is therefore most earnestly e

hioined, hence this
submission.


Republic of the Phil
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

HOUSE BILL NO.4015

Introduced by Rep. Winston “Winnie” Castelo

AN ACT
PROMOTING THE REDUCTION OF POVERTY THROUGH THE DEVELOPMENT OF
MICRO, SMALL AND MEDIUM ENTERPRISES

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 "Go Negosyo Act of 2013."

SECTION 2. Declaration of Policy. It is hereby declared the policy of the State to
foster national development, promote inclusive growth, and reduce poverty by
encouraging the establishment of micro, small and medium enterprises (MSMESs)
that facilitate local job creation and production in the country. MSMEs increase
income for poor households and build both business equity and personal assets over
a period of time. To this end, the State shall develop plans and initiate means to ease
the constraints on the establishment of MSMEs in order to rationalize the existing
bureaucratic regulations, providing greater incentives and benefits to MSMEs, and
strengthening the Micro, Small and Medium Enterprise Development (MSMED)
Council.

SECTION 3. Establishment of Negosyo Centers. There shall be established under the
supervision of the Micro, Small and Medium Enterprises Development (MSMED)
Council a “Negosyo Center” in all provinces, cities and municipalities. The MSMED
Council shall ensure inter-agency coordination, Local Government Unit (LGU)
Participation and public-private partnerships in the establishment and management
of Negosyo Centers. In applicable areas, the existing Micro, Small and Medium
Enterprise (MSME) Centers shall continue to operate as Negosyo Centers subject to
the provisions of this Act. The Negosyo Centers shall be responsible for promoting
ease of doing business and facilitating access to services for MSMEs within its
jurisdiction. The MSMED Council, through the regional offices of the Department of
Trade and Industry (DT!) shall perform oversight functions and shall assign personnel
to fulfill the functions of the Negosyo Centers.


SECTION 4. Functions of Negosyo Centers. - Negosyo Centers shall have the

following functions:

(a) Promote ease of doing business and access to services for MSMEs within

its jurisdiction;

(b) Coordinate and facilitate processes of government related to the set-up

and management of MSMEs;
(c) Accept and facilitate all registration applications of MSMEs;

(d) Coordinate with the respective local government units and liaise with
concerned government agencies to process the duly accomplished forms
submitted by the MSMEs;

{e) Integrate a unified business processing system for MSMEs;
(f) Monitor and recommend business-process improvements for MSMEs.

(g) Encourage government institutions that are related to the business
application process to help promulgate information regarding the

Negosyo Center;
(h) Supply information and services in training, financing and marketing;
(i) Support private sector activities relating to MSME development;

() Co-organize with the local chambers of commerce and other business
organizations a mentoring program for prospective and current

entrepreneurs and investors;

(k) Build local support networks and establish market linkages for MSME

development;

(I) Coordinate with schools and organizations on the development of a youth

entrepreneurship training program;


(m) Facilitate access to grants and other forms of financial assistance, shared

service facilities and equipment, and other support for MSMEs;

(n) Ensure labor-management guidance, assistance and improvement of the

working conditions of MSMEs;

{o) Establish a databank which shall be a source of all information necessary
for project monitoring, research and policy studies and information

dissemination campaigns;

(p) Map out all information and services essential to prospective
entrepreneurs and prospective investors especially in key value chains

and economic subsectors within its jurisdiction;

(g) Establish a feedback mechanism among the MSMEs in the respective

jurisdiction of the Negosyo Centers; and

(r) Conduct other programs or projects for entrepreneurial development in

the country aligned with the MSME development plan.

SECTION 5. Registration. —
{a) Micro, Small and Medium Enterprises

1. A.unified and simplified business registration form shall be created by
the DTI and shall be made available in all Negosyo Centers. The
unified business registration form shall contain all necessary
information for the business application process of MSMEs. The DTI
shall be responsible for regularly updating and maintaining the unified
business registration form.

2. The Negosyo Center of each city or municipality shall facilitate and
expedite the business application process of MSMEs in coordination
with the LGUs and other concerned agencies.

3. Should the concerned business permits and licensing offices fail to
Process the application within fifteen (15) days, the MSME shall be
deemed registered for a period of one (1) year. in this case, these
offices shall have the authority to revoke the registration within a
period of thirty (30) days upon determination that the MSME has not
met the necessary requirements and qualifications.


4. Thereafter, MSMEs shall renew its registration annually.

(b) Certificate of Authority for Barangay Micro Business Enterprises
(BMBEs) — The Negosyo Center in the city or municipal level shall have
the sole power to issue the Certificate of Authority to BMBEs in
accordance with Republic Act No, 9178. Upon the approval of registration
of the BMBE, the Negosyo Center shall issue the Certificate of Authority,
which shall automatically exempt the micro enterprise from the minimum.
wage law and from income tax. To defray the administrative costs of
registering and monitoring the micro enterprise, the Negosyo Center may
charge a fee of not more than Five Hundred Pesos (Php 500.00).

Philippine Business Registry ~ A Philippine business registry system shall
be housed under the Negosyo Center, if available, for use of MSMEs to
expedite registration with concerned licensing offices.

(¢

SECTION 6. Start-up Fund for MSMEs. ~ Aside from the existing benefits for MSMES,
the MSMED Council, through DTI, the Department of Finance (DOF) and the
appropriate financing institutions, shall establish a Start-up Fund for MSMEs to be
sourced from the MSME Development Fund and BMBE Fund to provide financing for
the development and promotion of MSMEs in priority sectors of the economy as
specified in the MSMED Plan.

SECTION 7. Composition of the Micro, Small and Medium Enterprise Development
Council (MSMED). - To ensure greater representation by the sectors involved, the
members of the Council shall be the following:

(a) Secretary of Trade and Industry as Chairman;

(b) Secretary of Agriculture;

(c) Secretary of the Environment and Natural Resources;

(d) Secretary of the Interior and Local Government;

(e) Secretary of Science and Technology;

(f) Secretary of Tourism;

(g) Director General of National Economic Development Authority;
(h) Governor of the Bangko Sentral ng Pilipinas;

(i) Chairman of Small Business Corporation;


(i) Three (3) representatives from the MSME sector to represent Luzon,
Visayas, and Mindanao with at least one representative from the micro
enterprise sector and at lease one representative from the youth sector

‘to focus on the promotion of youth entrepreneurship;

(k) One representative from the labor sector, to be nominated by accredited

labor groups;

(I) A representative from the private banking sector: to serve alternately
among the Chamber of Thrift Banks; the Rural Banker's Association of the
Philippines (RBAP); and the Bankers’ Association of the Philippines (BA);

(m)A representative of Microfinance Non-Government Organizations (NGOs);

(n) Chairperson of the Senate Committee on Trade, Commerce and

Entrepreneurship; and

(0) Chairperson of the House Committee on Small Business and

Entrepreneurship Development.
The members may elect from among themselves a Vice-chairman to preside over the

Council meetings in the absence of the Chairman.

SECTION 8. Functions of MSMED Council. - The MSMED Council shall have the
following additional functions:

(a) Coordinating and Oversight Body for the Negosyo Center — MSMED
Council, through the DTI, shall act as the coordinating and supervising
body for all the agencies involved in the establishment and operation of
the Negosyo Centers. Further, the MSMED Council shall monitor and
assess the progress of the Negoyso Centers which shall be included in its
annual report to the Congress.

(b) Provision of a Compliance Guide - For each rule or group of related rules
issued by any government agency for compliance by MSMEs, the Council
shall publish compliance guides entitled 'Micro, Small and Medium.
Enterprises Compliance Guide.' The Council shall ensure that the
compliance guide shall be written in plain language or in the local dialect,
if necessary.


The Council shall prepare separate compliance guides covering groups or
classes of similarly affected MSMEs and shall cooperate with industry
associations to develop and distribute such compliance guides. The
publication of each compliance guide shall include the posting of the
guide in an easily identified location on the website of the agency; and
distribution of the guide to known industry contacts, such as small
entities, associations, or industry leaders affected by the rule. The issuing
government agencies shall publish and disseminate the compliance rules
within ninety (90) days from the date of issuance.

SECTION 9. Information Dissemination. - The Philippine Information Agency,
through the Office of Public Information in each city or municipality, in coordination
with DTI, Bangko Sentral ng Pilipinas (BSP), Department of Labor and Employment
(DOLE), and Department of Interior and Local Government (DILG) shall ensure the
proper and adequate information dissemination of the contents and benefits of this
Act to the general public especially to its intended beneficiaries specifically in the
barangay level.

SECTION 10. Appropriations. - The amount necessary to carry out the initial
implementation of this Act shall be charged against the budget of DTI. Thereafter,
‘such sums as may be necessary for the continued implementation of this Act shall be
included in the succeeding General Appropriations Act.

SECTION 11. Implementing Rules and Regulations ~ The Secretary of the DTI, in
consultation with the appropriate agencies as may be deemed necessary, shall
formulate the necessary rules and regulations to implement the provisions of this
Act within ninety (90) days after its approval. The rules and regulations issued
pursuant to this Act shall take effect fifteen (15) days after its publication in a
newspaper of general circulation.

SECTION 12. Separability Clause. - If any provision of this Act shall be held
unconstitutional, the remainder of the Act not otherwise affected shall remain in full
force and effect.

SECTION 13. Repealing Clause. — Sections 4 of Republic Act No. 9178 is hereby
repealed. Sections 7-A and 7-B of Republic Act No. 6977, as amended by Republic Act
No. 8289 and Republic Act No. 9501, are hereby amended. Section 12 of Republic
Act No. 9178 is also hereby amended. All other existing laws, presidential decrees,
executive orders, proclamations or administrative regulations that are inconsistent
with the provisions of this Act are hereby amended, modified or repealed
accordingly.


SECTION 14, Effectivity. - This Act shall take effect fifteen (15) days after its

publication in the Official Gazette or in at least two (2) newspapers of general
circulation.

Approved,