SIXTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES —)
First Regular Session )

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Representative Peter M. Unabia, Representative Juliette T, Uy,
Representative Ma. Lourdes Acosta-Alba

House Bill No. 4156
EXPLANATORY NOTE

The Social Enterprise ("SE") Bill provides the framework for the planning and
implementation of a National Poverty Reduction through Social Entrepreneurship
(the "PRESENT") Program. The SE Bill or the PRESENT Bill provides a nurturing
environment for the growth and burgeoning of strong and innovative Social
Enterprises as tools to reduce poverty,

A "Social Enterprise" as defined in the proposed Bill, refers to an enterprise
with the poor as primary stakeholders. This is an enterprise that explicitly declares
and pursues poverty reduction, alleviation, or improving the quality of life of specific
segments of the poor as a principal objective. A Social Enterprise engages and
invests in the poor for them to become effective workers, suppliers, clients and/or
‘owners, and ensures that a substantive part of the wealth created by the enterprise
is distributed to, or benefits them.

In addition to reinvesting its surplus or profits back to the enterprise to sustain
the fulfillment of its social mission, a Social Enterprise also uses its surplus or profits
and mobilizes other resources to assist the poor in becoming partners in the value
chain management/governance as well as to become partners in community,
sectoral and societal transformation

This is in line with Article XII, Section 1 of the Philippine Constitution which
states:

Section 1. The goals of the national economy are a more equitable
distribution of opportunities, income, and wealth; a sustained

increase in the amount of goods and services produced by the

nation for the benefit of the people; and an expanding productivity

as the key to raising the quality of life for all, especially the under-
privileged.

XXX XXX XXX

The challenge for Social Enterprises is how to become an effective poverty
reduction tool. In the face of this challenge, government must playa supportive role
to ensure that the appropriate systems, structures, and resources needed to support
Social enterprises are put in place. Government must help these new breed of


entrepreneurs to acquire resources, build successful organizations, and achieve
significant positive impact.

A nation's economy is not stagnant - new social investment models, ways of
doing business, and impact measurement tools continually arise. These changes at
times distort and blur the once clear boundaries among the traditional nonprofit, for-
profit, and public sectors. It is time that a "Social Enterprise" deserves to be officially
recognized and defined in order for the government to be able to give it adequate
support. Therefore, the legislature is urged to pass measures wherein the
government must make a leap forward and take advantage of this potential for the
nation's social change.

Such leap forward is through the PRESENT Bill.

We

Maximo’B. Rodriguez, Jr.

(

"Ma: Lourdes Acosta-Alba


SIXTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez,
Representative Maximo B. Rodriguez, Jr., Representative Rolando A. Uy
Representative Peter M. Unabia, Representative Juliette T. Uy,
Representative Ma. Lourdes Acosta-Alba

House Bill No. _4156

AN ACT

ORDAINING THE PROMOTION OF SOCIAL ENTERPRISES TO ALLEVIATE
POVERTY,

ESTABLISHING FOR THE PURPOSE THE POVERTY REDUCTION THROUGH
SOCIAL

ENTREPRENEURSHIP (PRESENT) PROGRAM AND PROVIDING INCENTIVES
AND BENEFITS

THEREFOR

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

CHAPTER |
GENERAL PROVISIONS
SECTION 1. Short Title. - This Act shall be known as the "Poverty Reduction
Through Social Entrepreneurship (PRESENT) Act."

SECTION 2. Declaration of Policy. -The State shall promote a just and dynamic
social order that will ensure the prosperity and independence of the nation and free
the people from poverty through policies that provide adequate social services,
promote full employment, a rising standard of living, and an improved quality of life
for all. The State shall provide social justice in all phases of national development
and that the State values the dignity of every human person and guarantees full
respect for human rights.

The goals of the national economy are a more equitable distribution of
opportunities, income, and wealth; a sustained increase in the amount of goods and
services produced by the nation for the benefit of the people; and an expanding
productivity as the key to raising the quality of life for all, especially the
underprivileged. The State shall promote industrialization and full employment based
on sound agricultural development and agrarian reform, through industries that make
full and efficient use of human and natural resources, and which are competitive in
both domestic and foreign markets. However, the State shall protect Filipino
enterprises against unfair foreign competition and trade practices

The State also recognizes the important role of enterprises in the economy as
the major agent of development, creating off-farm employment opportunities and
providing transitional means for improving the livelihood of the people.


Towards this end, the State shall pursue a poverty reduction program that
promotes an environment conducive to the development and growth of a vibrant
social enterprise sector engaged in poverty reduction, economic and social
development. It shall empower the poor as primary stakeholders in social
enterprises, establish mechanisms essential to realizing their potential and achieving
their full growth, and extend the assistance necessary for their advancement. The
State shall likewise ensure that the provision for technical and financial assistance,
incentives and other services are free from any condition that might infringe upon the
autonomy or organizational integrity of the social enterprises to enable them to
develop into viable and vital anti-poverty agents, and a strong social
entrepreneurship movement which will be instrumental in reducing poverty in the
country.

SECTION. 3. Definition of Terms. - As used in this Act:

a) Social Enterprise or SE refers to a wealth-creating organization, whether an
association, single proprietorship, partnership, corporation, or a cooperative or any
other legal form, whose primary stakeholders are marginalized sectors of society,
engaged in providing goods and services that are directly related to its mission of
improving societal well-being. It is established to achieve triple bottom lines such as
financial, social and ecological. It generates profit or surplus with due regard to social
and environmental costs, and makes a pro-active contribution to resolving social and
environmental problems.

‘A social enterprise for purposes of this act shall mean a Social Enterprise with
the Poor as Primary Stakeholders (SEPPS). A SEPPS is a social enterprise that
explicitly declares and pursues poverty reduction/alleviation or improving the quality
of life of specific segments of the poor as principal objective. A SEPPS engages and
invests in the poor to become effective workers, suppliers, clients and/or owners,
and/or ensures that a substantive part of the wealth created by the enterprise is
distributed to, or benefits them. In addition to reinvesting its surplus or profits back to
the enterprise to sustain the fulfillment of its social mission, a SEPPS also uses its
surplus or profits and mobilizes other resources to assist the poor to become
partners in SE or value chain management/governance and to become partners in
community, sectoral and societal transformation

b) Absolute poverty refers to the condition of the household below the food threshold
level;

©) Assets refer to all kinds of properties, real or personal, owned by the social
enterprise (SE) as defined in paragraph (dd) of this Section and used for the conduct
of its business: Provided, That for the purpose of exemption from taxes and to
benefit from other incentives under this Act, this term shall mean all kinds of
properties, real or personal, owned and/or used by the SE for the conduct of its
business;

d) Basic sectors shall refer to the disadvantaged sectors of Philippine Society,
namely: fatmer-peasant, artisanal fisher folk, workers in the formal sector and
migrant workers, workers in the informal sector, indigenous peoples and cultural
communities, women, persons with disability, senior citizens, victims of calamities
and disasters, youth and students, children, and urban poor as defined under


Republic Act (R.A.) No. 8425, otherwise known as the "Social Reform and Poverty
Alleviation Act";

e) Bottom line shall refer to the objectives or purposes for which a SE is established.
Triple bottom line shall refer to social, ecological and financial objectives;

) Capability building refers to the process of enhancing the viability and sustainability
of SEs and pertain to education, training, coaching and other learning events like
study tours; technical, consultancy and advisory services; assistance in
organizational systems development; technology incubation, development and
dissemination; value chain and subsector development; conduct of SE trade fairs
and missions; networking and policy advocacy initiatives and other such activities
that enable SEs to be effective and efficient vehicles for poverty reduction, The term
capability building precludes the grant of any loan or equity funds to the SE and shall
in no way refer to the provision of equity investments, seed funding, partnership's
seed funds, equity participation, start-up funds or any such activity that connotes the
infusion of capital or funds from the government or from the SE Development Fund
created under Section 16 of this Act;

9) Civil society organizations refer to private voluntary organizations of citizens that
are established to pursue a mission, usually involving the interest of the public,
marginalized groups or specific sectors of society. They include non-government
organizations, socio-civic groups, foundations and people's organizations;

h) Council shall refer to the SE Council,

i) Cooperative shall refer to an autonomous and duly registered association of
persons, with a common bond of interest, who have voluntarily joined together to
achieve their social, economic, and cultural needs and aspirations by making
equitable contributions to the capital required, patronizing their products and services
and accepting a fair share of the risks and benefits of the undertaking in accordance
with universally accepted cooperative principles as defined in RA. 6938, as
amended by R.A. 9520, otherwise known as the "Philippine Cooperative Code of
2008";

}) Corporate Social Responsibility or CSR shalll refer to the commitment of a private
enterprise or business to contribute on a voluntary basis to a sustainable social and
economic development by working with relevant stakeholders to improve their lives
in ways that are good for business, the social reform agenda, the sustainable
development agenda, and society at large. CSR-related activities shall include, but
not be limited to, the following: 1) Charitable programs and projects; 2) Scientific
research; 3) Youth and sports development; 4) Cultural or educational promotion; 5)
Services to veterans and senior citizens; 6) Social welfare; 7) Environmental
sustainability; 8) Health development; 9) Disaster relief and assistance; and
Employee and worker welfare related CSR activities;

k) Economic subsectors are networks of related actors and enterprises performing
various functions in value chains. These actors and enterprises transform raw
materials into finished products, or develop services, and distribute or provide them
through market channels to final consumers; they may be identified by key raw


material source, by finished product or final service provided. An economic subsector
may be comprised of several competing value chains. By understanding the
dynamics of economic subsectors and using them as units of planning social
entrepreneurship interventions, government agencies, support institutions and SEs
shall more effectively reach and benefit a greater number of poor in poverty
reduction programs;

) Empowerment strategy shall mean a development strategy that enables the
marginalized sectors to own, manage, and control SEs in order for them to reap
maximum benefits from it and which acts as a channel for directly distributing
income;

m) Fair trade shall refer to a trading partnership based on dialogue, transparency
and respect and which seeks greater equity in international trade and the
transformation and adaptation of trading structures and practices in favor of the poor
and disadvantaged by offering better trading conditions to, and securing the rights of,
marginalized producers and workers;

n) Fair trade organizations shall mean enterprises certified by internationally and
nationally recognized Fair Trade networks;

©) Fair trade principles refer to the values adopted by fair trade organizations in their
day-to-day operation. These include creating opportunities for economically-
disadvantaged producers; transparency and accountability, payment of a fair price;
ensuring no child labor and forced labor, commitment to non-discrimination, gender
equity and freedom of association; ensuring good working conditions; providing
capacity building; and, respect for the environment;

p) Foundation shall mean the categorization of a non-profit organization that typically
either donates funds and support to other organizations or provides the source of
funding for its own charitable purposes. Unlike a company, foundations have no
shareholders though they may have a board, an assembly and voting members. A
foundation may hold assets in its own name for the purposes set out in its
constitutive documents, and its administration and operation are carried out in
accordance with its statutes or articles of association rather than fiduciary principles;

q) GPPB refers to the Government Procurement Policy Board established in
accordance with Article X of R.A. No. 9184, otherwise known as the "Government
Procurement Reform Act;"

1) Intermediation strategy shall refer to a development strategy that provides
financial, agricultural, business development and institutional development services
to the entrepreneurial poor and employers of the poor and provides as well product
development and marketing support using the principles of fair trade to marginalized
producers. A SE engaged in intermediation strategy need not be owned by the
marginalized stakeholders but provide immediate access to services among a critical
mass of these marginalized stakeholders;


s) Marginalized Sectors shall refer to groups of people who are stigmatized or
marginalized by virtue of their physical, psychological, economic, social or cultural
circumstance;

t) Micro-enterprise as defined in R.A. No. 6977, as amended by R.A, No, 9501,
otherwise known as the "Magna Carta for Small Enterprises," shall refer to any
business activity or enterprise engaged in industry, agribusiness and/or services,
whether single proprietorship, cooperative, partnership or corporation whose total
assets, inclusive of those arising from loans but exclusive of the land on which the
particular business entity's office, plant and equipment are situated, must have a
value of not more than Three Million Pesos (P3,000,000.00). This amount is subject
to review and adjustments by the Micro, Small and Medium Enterprises
Development (MSMED) Council, taking into account inflation and other economic
indicators and may use other variables such as number of employees, equity capital
and assets size;

u) Microfinance shall refer to the provision of a broad range of financial services such
as deposits, loans, payment services, money transfers and insurance products to the
poor and low-income households and their microenterprises and small businesses,
to enable them to raise their income levels and improve their living standards;

v) Minimum basic needs shall refer to the needs of a Filipino family pertaining to
survival (food and nutrition; health; water and sanitation), security (shelter; peace
and order, public safety, income and livelihood); and enabling services (basic
education and literacy, participation in community development, family and psycho-
social care);

w) Non-Government Organization or NGO refers to a duly registered non-stock,
non-profit organization focusing on the upliftment of the basic or disadvantaged
sectors of society by providing advocacy, training, community organizing, research,
access to resources, and other similar activities and, as defined under Section 34
(H)(2)(c) of Republic Act No. 8424, as amended, otherwise known as the National
Internal Revenue Code of 1997, organized and operated exclusively for scientific,
research, educational, character-building and youth and sports development, health,
social welfare, cultural or charitable purposes, or a combination thereof, and no part
of the net income of which inures to the benefit of any private individual,

x) People's Organization or PO refers to a self-help group belonging to the basic
sectors and/or disadvantaged groups composed of members having a common bond
of interest who voluntarily join together to achieve a lawful common social or
economic end;

y) Persons with Disability shall refer to individuals with restriction or different abilities,
as a result of a mental, physical or sensory impairment, to perform an activity in the
manner or within the range considered normal for a human being;

2) Poor shall refer to individuals and families whose income fall below the poverty
threshold as defined by the National Economic and Development Authority and/or
are deprived of the means to provide in a sustained manner their minimum basic


needs of food, health, education, housing and other essential amenities of life, as
defined under R.A. 8425;

aa) Poverty reduction/alleviation shall mean overcoming the income, resource, and
capability deprivation among the poor as defined in the preceding paragraph and the
marginalized sectors as defined in paragraph (s) hereof;

bb) Private Enterprise shall refer to an organization engaged in a business activity
organized for the purpose of accumulating profit and whose primary stakeholders
and beneficiaries are its owners;

cc) Procuring Entity refers to any branch, department, office, agency, or
instrumentality of the government, including state universities and colleges,
government-owned and/or - controlled corporations, government _ financial
institutions, and local government units procuring Goods, Consulting Services and
Infrastructure Projects;

dd) Resource mobilization strategy shall refer to a development strategy intended to
generate income from the sale of products and services of a SE in order to finance
or subsidize the operations of its core development program or development
interventions among the marginalized sectors;

ee) SEGFP refers to the SE Guarantee Fund Pool created under this Act;

ff) Social development refers to the continuing process of addressing the needs of
society, beginning with the people's minimum basic needs, through a systematic
implementation of socioeconomic programs or packages;

gg) Social Enterprise Service Institution refers to an organization that provides
assistance to SEs for them to become viable and sustainable and which assistance
pertains to supplying needs such as trainings, education and other capacity-building
measures, research and development, and other similar activities;

hh) Social Enterprise Advocacy Group refers to an organization whose primary
purpose is supporting the cause of SEs especially with regard to public policy and
articulating issues or causes related to social entrepreneurship;

ii) Social entrepreneur refers to an innovative individual or institution that promotes
the creation and operationalization of enterprises or livelihood endeavors for those in
need or which address social problems and improve societal well-being;

ji) Social entrepreneurship entails innovations designed to explicitly improve societal
well-being, housed within entrepreneurial organizations, which initiate, guide or
contribute to change in society;

kk) Social Inclusion strategy refers to the development strategy that assists groups of
people who are stigmatized or marginalized by virtue of their physical, psychological,
economic, social or cultural circumstance in order to restore their dignity by not only
removing the barriers that limit their access to the delivery of basic social services


and employment, but more importantly, by nurturing work and other environments
that create avenues for their participation as productive members of society;

\\) Social Investors are individuals or institutions that choose to put in money to a
business endeavor or activity not principally for financial profit but to fulfill a social
mission which may include poverty reduction, concern for environmental protection,
strong organizational governance, and a desire for a more economically just world;

mm) Social reform refers to the continuing process of addressing the basic inequities
in society through a systematic, unified and coordinated delivery of socioeconomic
programs or packages;

nn) Social value refers to the additional benefit to the community from the
government procurement process over and above the direct purchasing of goods,
services and outcomes, including social; economic and environmental benefits;

00) Transactional roles refer to enterprise-related functions performed by the poor
that involve an exchange of goods or services for money including being workers,
‘suppliers, clients or owners;

pp) Transformational roles are functions performed by the poor as conscious agents
of change to lift their own selves from poverty and to participate in group efforts to
improve the quality of life of their community, sector or society as a whole;

qq) Transactional services pertain to enterprise or market-driven activities, such as
providing loans, demonstrating new technologies or conducting trainings that are
necessary for the poor in the SE system to effectively and efficiently perform their
roles as workers, suppliers, clients and owners. Transactional services may be fee-
based, such as the granting of loans, or non-fee based, such as the extension of
production-related trainings;

it) Transformational services pertain to activities that empower the poor, such as
leadership formation and organizational development, asset build-up and providing
education and experiential learning opportunities, to become conscious change
agents for themselves, for their communities, sectors and society as a whole;

ss) Underemployment shall mean an economic position where an employed person's
desire to have additional hours of work in his/her present job or to have an additional
job, or to have a new job with longer working hours is not met;

tt) Unemployment shall mean an economic situation where persons who are 15
years old and over as of their last birthday and are 1) without work or have no job or
business, 2) available for work and willing to take up work in paid employment or
self-employment, 3) seeking work and had taken specific steps to look for a job or
establish a business but failed to; and

uu) Value chain refers to value-adding economic activities that an enterprise is
interlinked with in the process of producing goods and/or services to serve its chosen
market. A value chain typically consists of: 1) inbound distribution or logistics, 2)
manufacturing operations, 3) outbound distribution or logistics, 4) marketing and


selling, and 5) after-sales service. These activities are supported by 6) purchasing or
procurement, 7) research and development, 8) human resource development, and 9)
organizational development. A SE that understands and manages its value chain
improves its capability to create economic, environmental and social values towards
improving the position and benefits of the poor in the value chain and towards
ensuring the viability and sustainability of the enterprise

CHAPTER II
POVERTY REDUCTION THROUGH SOCIAL ENTERPRISES
SECTION 4, Social Enterprise (SE); General Concept and Coverage - A SE, for
purposes of this Act, refers to a Social Enterprise with the Poor as Primary
Stakeholders as the term is defined in Sec. 3a of this Act. It may be collectively
owned by the poor in the form of cooperatives or associations where the poor are the
exclusive owners or comprise a majority of the members. SEPPS may also include
NGOs or other organizations that engage in wealth-creating activities, the proceeds
of which are used exclusively to finance the futfillment of their social mission.

SECTION 5. Eligibility for Benefits and Incentives. - To be recognized and be eligible
for the benefits and incentives provided for in this Act, the SE shall:

a) provide or facilitate the provision of a combination of transactional and/or
transformational services to improve the position and benefits derived by the
poor from the SE and the value chain ot economic subsector where the SE is
located, including becoming worker-owners, supplier-owners, supervisors and
managers, active members and leaders in governing bodies of the SE or its
allied organizations;
invest a substantive part of its surplus, profits or mobilize other resources to
assist the poor to become partners in SE or value chain
management/governance and/or to. become partners in community, sectoral
and societal transformation;
make a pro-active contribution to resolving social and environmental problems
and generate profit or surplus with due regard to social and environmental
costs;

‘employ any of the following development strategies in the pursuit of its social
mission: 1) empowerment strategy; 2) social inclusion strategy; 3)
intermediation strategy; and, resource mobilization strategy;

be engaged in an economic activity within the sectors of agriculture and
fisheries, industry and services Which, for purposes of this Act, shall refer to
an activity in any of the economic subsectors;

f) ensure that a substantive part of the wealth created by the enterprise is
distributed to the poor in the form of services, dividends and other forms of
benefits, and payments and incentives for products or services rendered
consistent with the principles of fair trade;

be duly registered with the appropriate agencies as provided under the
Corporation Code or the Cooperative ‘Code of the Philippines, Magna Carta
for Micro, Small and Medium Enterprises, Barangay Micro Business
Enterprises Act and other laws

b)

°)

d)

e)

9

Financial sustainability shall not be a prerequisite for the availment of
incentives and benefits under this Act. Provided that, social enterprises that have not
achieved financial sustainability may be eligible to avail of the services, assistance


and incentives set forth in this Act by presenting a workable strategy to achieve
financial sustainability over a reasonable period of time

SECTION 6. Other Eligibility Provisions, In the case of social enterprises organized
as stock corporations, partnerships or sole proprietorships, the following additional
requirements shall apply:

a) A social enterprise, if organized as a sole proprietorship or partnership must
be one hundred percent (100%) owned and capitalized by Filipino citizens. If
the enterprise is a stock corporation, at least sixty percent (60%) of its
outstanding capital stocks must be owned by Filipino citizens;

A social enterprise must not be organized as a branch, subsidiary or division
of a private business enterprise, regardless of the size of such private
business enterprise, nor may its policies be determined by a private business
enterprise. Provided, that this shall not preclude a SE from accepting
subcontracts from large private business enterprises or firms or from joining in
cooperative or joint-venture activities with other SEs or foundations practicing
CSR.

A social enterprise organized as stock corporations, partnerships or sole
proprietorships, must invest at least 60% of its gross revenues to sustain the
fulfillment of its social mission or to provide transformational services for the
poor.

b)

°)

SECTION 7. Qualifications. - Within ninety (90) days from the effectivity of this Act,
the Social Enterprise Development Council shall formulate the implementing rules
and regulations for the application and accreditation of enterprises to qualify as SE
under this Act, following the principles of self-regulation, transparency and
responsibility.

SECTION 8. Formulation of a Poverty Reduction through Social Entrepreneurship
(PRESENT) Program - To promote the development of a SE sector with the poor as
primary stakeholders, a comprehensive and fully-integrated Poverty Reduction
through Social Entrepreneurship (PRESENT) Program, shall be formulated, guided
by the following principles:

a) Incorporation of the PRESENT Program in the government's poverty

reduction drive as a major sustainable and comprehensive strategy;

b) Rationalization of poverty reduction programs by streamlining and
coordinating the various anti-poverty programs of the government to reduce
inefficiency and duplication and to improve the effectiveness of each program;
People's participation and empowerment by mobilizing civil society
organizations and social movement groups working with the poor,

Promoting sustainable programs that reduce inequality in incomes across
economic sectors and increase self-reliance among the poor,

Enabling SEs to overcome constraints and to take advantage of opportunities
for enhancing the position and benefits of the poor in economic subsectors
and value chains;

f) Gender-sensitivity by ensuring women’s equal rights and access to SE's
resources; and,

Development of sustainable mechanisms for the provision of quality and
accessible social services to the poor.

°)

qd,

e)

g


The planning framework of the PRESENT Program and its planning process
shall ensure that the poor are engaged as primary stakeholders, It shall add value
and complement ecosystem-based, area-based, community-based and other tools
and processes in local economic development by promoting and utilizing the
economic subsector as a strategic unit of analysis and planning SE development
interventions.

The PRESENT Program shall identify and develop key SEs and resource
institutions as partners in strategic economic subsectors that have the potential for
growth and where large numbers of the poor are concentrated. SEs shall be
developed as vehicles to ensure that the poor benefit the most from sustainable
subsector development.

PRESENT medium-term and annual development plans shall be formulated in
synchrony with the medium-term development plan of the national government.

SECTION 9. Social Enterprise Development Council. - To carry out the policy
declared under this Act, a Social Enterprise Development Council (SEDC),
hereinafter referred to as the Council, is hereby created as an agency attached to
the Department of Trade and Industry (DTI). It shall be the primary agency tasked to
carry out the promotion, growth and development of social enterprises in the country.

The Council shall be composed of the following:

a) Secretary of Trade and Industry, as co-chairperson;

b) SE sector head representative, as co-chairperson;

©) Secretary of Agriculture, as co-vice chairperson;

d) Lead Convenor of the National Anti-Poverty Council (NAPC), as co-
vice chairperson;

e) Secretary of Social Welfare and Development;

f) Director-General of the National Economic Development Authority
(NEDA);

g) Secretary of Finance;

h) Secretary of the Interior and Local Government;

i) Secretary of Labor and Employment;

i) Secretary of Science and Technology;

k) Secretary of Education;

!) Secretary of Agrarian Reform;

m) Secretary of Health;

n) Secretary of Environment and Natural Resources;

©) Chairperson of the Cooperative Development Authority (CDA);

p) Nine (9) representatives from SEs, three (3) representatives each from
the main island groupings of Luzon, Visayas, and Mindanao;

4) Three (8) representatives from SE service institutions; and

1) Three (3) representatives from SE advocacy groups, as members.

Cabinet-ranked ex officio members of the Council shall designate a
permanent representative in case they fail to attend its meetings. The designated
permanent representative of any of the Cabinet-ranked members of the Council must
hold a position not lower than a bureau director.

The SE sector head, the representatives of the SEs from the main island
groupings of Luzon, Visayas, and Mindanao, the SE service institutions, and the SE
advocacy groups shall be chosen by the President from among the nominees
submitted by their respective national organizations to serve in the Council for a term


of three (3) years. These representatives must be conversant in the theory and
practice of SE and committed to the policies and programs provided under this Act.

The Chairperson and members of the Council shall be entitled to a
reasonable per diem for each meeting actually attended at such amount as may be
fixed by the Council in accordance with existing laws, rules and regulations

The Council shall, from time to time, call upon the participation of any
government agency to attend in its meetings to assist in clarifying issues and finding
resolution to problems that concer their respective offices with respect to the
implementation of the PRESENT Program enunciated under this Act or any
development program for SEs.

The Council may create an Executive Committee of seven (7) members
elected by its members from among themselves or their designated permanent
representatives, with at least three (3) members representing the SEs, and with the
authority to act for the Council, and within the specific authority granted by the
Council

SECTION 10. Powers and Functions. - The Council shall have the following powers
and functions:

a) Formulate policies, plans, programs and projects to develop and promote SEs
as a tool for poverty reduction consistent with national development
objectives;

Oversee the successful implementation of the PRESENT Program and other

SE programs;

Identify and access sources of financing for the SE sector in the form of

grants for enterprise incubation and start-up and loans for expansion;

Monitor and evaluate the performance of programs and projects for

appropriate incentives;

e) Call upon any government agency to carry out and implement programs and
projects identified by the Council;

f) Call upon people's organizations, non-government organizations, the

academe and other sectors to provide advice on matters pertaining to SEs

and conduct of transactional and transformational services to farmers,

producers, workers, consumers and other stakeholders,

Submit annual and other periodic reports to the President and the Congress

of the Philippines through the Congressional Oversight Committee;

Promulgate such rules and regulations and exercise such other powers and

functions as may be necessary to carry out the purposes of this Act; and

i) Perform such other functions as may be necessary for its effective operations
and the continued enhancement, growth and development of the SE sector.

b)

°)

f:)

9
h)

SECTION 11. Secretariat. - There is hereby created a Secretariat headed by an
Executive Director to serve as the national technical and administrative secretariat of
the Council with the member agencies providing additional support staff when the
need arises. The Secretariat shall perform the following functions:

a) Provide administrative support to the Council, with the assistance of the
National Economic and Development Authority secretariat in the formulation
of the PRESENT development programs and plans:

b) Assist the Council in the implementation of the PRESENT development
program and the annual and medium-term development plan;

©) Assist the Council in the accreditation of SEs;


d) Assist the Council in monitoring the PRESENT development programs and

the activities of the various concerned government agencies with respect to

SEs;

Assist the Council in facilitating funding mechanisms and promoting support

programs for SEs.

f) Prepare, collate and integrate all necessary inputs to the Council's yearly
report on the status of SEs in the country;

g) Submit periodic reports to the Council on the progress and accomplishment of
its work programs; and

h) Perform other functions that may be assigned and authorized by the Council.

e)

SECTION. 12. Office. - The Council shall have its principal place of business in
Metro Manila and may establish such branches within the Philippines as may be
deemed necessary by the President of the Philippines to carry out the powers and
functions of the Council

SECTION. 13, National Center for Social Enterprise Development. - There shall be
established a National Center for Social Enterprise Development (NCSED) under the
Council which shall perform the following functions:

a) Provide SEs with capability-training and education through the Social
Enterprise Capability Building and Sustainability Program created
under Section 16 of this Act;

b) Develop and enhance a research and development system which shall
equip every SE with innovative and sustainable approaches that
ensures improvement in the access to basic social services by the poor
pursuant to Section 18 of this Act; and
Manage a Social Enterprise Marketing Assistance Program (SMAP)
that will ensure the generation of the highest possible income for the
SEs pursuant to Section of this Act.

The NCSED shall be headed by the Executive Director of the Council
Secretariat, It shall maintain a multi-sectoral, multi-disciplinary pool of experts
including those from the academe, practicing professionals, business and industry,
youth, women and other concerned sectors, who shall be screened according to the
qualifications set by the Council

The NCSED shall coordinate with the University of the Philippines Institute for
Small Scale Industries (UP 1551), the Technical Education and Skills Development
Authority (TESDA), the Department of Transportation and Communications (DOTC),
civil society organizations and other relevant agencies, state universities and
colleges in implementing its programs.

°)

SECTION. 14. Personnel. - Subject to the civil service laws, rules and regulations,
the Council is authorized to select, appoint, employ and fix the compensation of the
officers and employees of the Secretariat and the NCSED as shall be necessary to
carry out its functions.

SECTION. 15. Role of LGUs in SE Development - Pursuant to the relevant
provisions of R.A. No. 7160, otherwise known as the Local Government Code, the
LGUs shall be primarily responsible for the development of SEs and the
implementation and enforcement of the relevant provisions of this Act within their
respective jurisdictions with the end in view of reducing poverty therein.


The LGUs are hereby mandated to include in their respective local
development plans certain policies and programs geared toward the development of
SEs in their jurisdiction.

LGUs with viable SE development plan as incorporated in their respective
local development plans are entitled to avail of the SE Development Fund created
under the immediately succeeding section for the purpose of initiating and facilitating
the development and sustainability of SEs in their own jurisdiction: Provided, That no
LGU shall establish and operate its own SE.

CHAPTER Ill
DEVELOPMENT OF SOCIAL ENTERPRISES
SECTION 16. Social Entrepreneurship Education in Schools - Toward strategically
developing the nation's human resource capability in social entrepreneurship, the
DepEd and the CHED shall cause the integration of SE content and inclusion of SE
courses in the curricula at all levels, especially in the secondary and tertiary levels.
This shall be part of the SE Capability Building and Sustainability Program stated in
Sec. 17 of this Act.
A continuing social entrepreneurship education program for out-of-school
youth and adults shall likewise be developed and undertaken.
The social entrepreneurship education program for primary and secondary
education shall include information regarding:
a) social issues and civic ways of addressing them;
b) the producer as a steward of natural resources;
¢) the consumer as a responsible member of society and his responsibility to
develop critical awareness which is the responsibility to be alert and
questioning about the environmental and social impacts of the goods and
services he/she uses:
1. social concern which is the responsibility to be aware of the impact of
his consumption to society, especially the disadvantaged; and
2. environmental awareness which is the responsibility to understand the
environmental consequences of his use of natural resources,
consumption, recognizing his individual and social responsibility to
conserve natural resources for future generations.
All higher learning institutions and vocational schools are mandated to include
a subject on social entrepreneurship in their social studies program or in their
business, commerce, or economics courses.

SECTION 17. SE Capability Building and Sustainability Program; Creation of SE
Development Fund - There is hereby established a SE Capability Building and
Sustainability Program whose primary objective is to guarantee the viability and
sustainability of SE through activities that advance, in general, both transformational
services and transactional services. The NCSED will work with qualified SE
intermediaries who will develop the Program and be responsible for designing and
delivering training in social entrepreneurship development, _ institutional
strengthening, human resource competency and skills training, business planning
and advisory services, upgrading of accounting and auditing systems, technical
assistance for the installation or improvement of management information systems,
technology intervention, technology incubation/commercialization, market studies,
and product development competitiveness, business matching activities, trade fairs
and missions, policy advocacy, disaster-resiliency and other related activities.


The SE Capability Building and Sustainability Program shall likewise include
the establishment of an insurance system for SEs affected by natural calamities in
line with the National Framework Strategy on Climate Change 2010-2022 as
provided for under RA 9729 or the Climate Change Act of 2009 and RA 10121 or the
Philippine Disaster Risk Reduction and Management Act of 2010.

For this purpose, there is hereby created and established a SE Development
Fund (SEDF) in the amount of Three Billion Pesos (P3,000,000,000.00) to be
administered by the Council with an endowment from the earnings of the Philippine
Amusement and Gaming Corporation (PAGCOR), in addition to appropriations by
Congress, voluntary contributions, grants, gifts from both local and foreign sources
as may be accepted by the Council

Only the fruits of the SEDF shall be used for the purposes provided herein.
Any undisbursed fruits for the preceding year shall form part of the disbursable
portion of the SEDF in the following year.

SECTION 18. Social Enterprise Research and Development System -The Council, in
coordination with the NEDA, DOST, DTI, and other appropriate agencies, research
institutions, and intermediaries, shall develop and enhance a research and
development system that:

a) provides studies on opportunities for poverty reduction and SE development
in key economic subsectors and other inputs for the Council to undertake
strategic planning for its PRESENT Program;
equip SEs and support institutions with: services and technologies that are
appropriate: for enhancing the participation and benefits of the poor in various
economic subsectors; and,
equip SEs and support institutions with innovative and sustainable
approaches to improve access of the poor to quality basic social services.

b)

°)

SECTION 19. Social Enterprise Marketing Infrastructure Development - The Council
shall promote the development and expansion of local and foreign markets for the
products and services of SEs, guided by the principles of fair trade. Consistent with
this, the Council shall:

a) establish a SE Marketing Assistance Program (SMAP) that will assist SEs
match supply with demand in both domestic and foreign markets, as well
as promote SE products and services through tri-media, trade fairs and
trade missions;

b) develop, install and sustain a SE market information system with the
assistance of the DT| and DOTC which shall be called the SE Marketing
Information Network (SMIN).

The SMIN shall be set up from the level of the municipal and provincial LGUs,
the regional and up to the Council level within one (1) year from the approval of this
Act, taking into account existing information networks such as the internet and using
a dedicated website for the purpose, to ensure linkage of the SEs with the
government and its various departments, agencies, bureaus and instrumentalities,
the local and domestic markets, as well as research institutions. The Council shall
provide technical assistance in setting up the SMIN at the local and regional levels.

All government departments, agencies, bureaus, research institutions, as well
as the LGUs shall consolidate and continuously update all relevant information and


data that would be of use to SEs on a periodic basis and make such data available in
a dedicated website on the internet.
The SMIN shall provide information and marketing services related to
products of SEs which shall include the following:
a) Supply data;
b) Demand data;
c) Price and Price trends;
d) Product standards;
e) Directory of, but not limited to SEs, traders, key market centers, processors
and business institutions both at the national and local levels;
f)_ Information and technology generated from research institutions;
g) International, regional and local market forecasts; and
h) Resource accounting data,

CHAPTER IV
INCENTIVES AND BENEFITS

SECTION 20. Special Credit Windows. - In addition to the special credit windows
provided for the promotion of microfinance as provided under Section 16 of RA 8425,
the Land Bank of the Philippines, Development Bank of the Philippines, Philippine
Postal Bank, and Al Amanah Bank, are hereby mandated to set aside at least eight
percent (8%) of their total loan portfolio based on their balance sheet in the end of
the preceding quarter, and open a special credit window for SEs

For a period of ten (10) years from the date of the effectivity of this Act, all
other lending institutions as defined under the Central Bank Act or the General
Banking Act, as amended, whether public or private, shalll likewise set aside at least
eight percent (8%) of their total loan portfolio based on their balance sheet as of the
end of the previous quarter and make the same available for SEs through a special
credit window. The BSP, in consultation with the Council, shall formulate the rules for
the effective implementation of this provision: Provided, That the purchase of
government notes, securities and other negotiable instruments shall not be deemed
compliance with the foregoing provision

The BSP shall establish an incentive program to encourage lending to SEs
beyond the mandatory credit allocation such as possible reduction in bank's reserve
requirement,

The Council shall establish a system to monitor all loan applications of SEs in
order to account for the absorptive capacity of the SE sector, The BSP shall require
lending institutions covered by this Act to furnish the Council on a quarterly basis a
regular report on their respective compliance with the above provisions on the
mandatory credit allocations for SEs and shall act immediately on the Council's
reports of non-compliance therewith.

The special credit windows for SEs shall bear interest lower than the market
rate and shall have longer terms of payment and waiver of applicable fees.

SECTION 21. Special Credit Window Purposes. - The special credit window
provided under Section 19 of this Act shall be intended for the following purposes:

a) Organizational developmental loan or capacity-building loan for the conduct of
social preparation activities or the conduct of capability-building and training
or professional development of the board, management and staff of the SE for
social entrepreneurship, such as business planning and advisory services,
technology intervention, incubation, market studies, and product development;


b) Credit line for business development loan or working capital loan to cover the

operational and management expenses of an existing business or income

generating project, including receivable financing or purchase of additional

inventory, soft or intangible investments such as trade fair participation or

acquisition of software or franchise development packages;

Fixed assets financing to cover acquisition of fixed assets like machineries

and equipment, motor vehicle, or acquisition of lot for project site or

construction of a plant and building and the improvement thereof,

d) Value chain financing to cover any of the value chain activities such as

production, processing and marketing;

Domestic letter of credit or trust receipt to provide a stand-by credit facility for

the SE borrower for the purchase of product inputs, equipment, machinery,

implements, and spare parts, whereby payment of ‘which is guaranteed and

to’ be made to the seller by the lending institution, provided all documents

conform with the terms and conditions of the credit; and

f) Revolving Credit Line for re-lending to finance the livelihood project
requirements of end-borrowers

°)

)

SECTION 22. Eligibility for Agriculture and Fisheries Credit. - At least ten percent
(10%) of the funds created under Section 6 of RA 10000, otherwise known as "The
Agri-Agra Reform Credit Act of 2009," mandated to be set aside by all banking
institutions, whether government or private, for agriculture and fisheries credit, shall
be made available for SEs engaged in agriculture and fisheries activities,

SECTION 23. Social Enterprise Guarantee Fund Pool with Non-Collateral Loans. -
There is hereby created a Social Enterprise Guarantee Fund Pool (SEGFP) which
shall be comprised of the five percent (5%) of the preceding year budget surplus of
the government-owned and controlled corporations and government financial
institutions including the PAGCOR, the Philippine Charity Sweepstakes Office
(PCSO), the Social Security System (655), the Government Service Insurance
System (GSIS), the National Power Corporation and the Philippine National Oil
Company (PNOC), as contribution to the SEGFP in accordance with relevant laws,
charters and by-laws, in addition to voluntary contributions, grants and gifts from
both local and foreign sources as may be accepted by the Council

The SEGFP shall be administered by the Council and shall be used to
mitigate the risks involved in SE sector lending, facilitating the provision of credit
therefor. The fund shall be placed in trust with the Land Bank of the Philippines for
the purpose of providing guarantee cover to participating financial institutions and
other parties in extending financing to SEs: Provided, that the fund may also be used
to cover the performance bond of SEs in government procurement

The Council, in coordination with the Land Bank of the Philippines, shall draw
up the mechanics and administrative arrangements and issue the implementing
guidelines for the fund pool.

SECTION 24. Utilization of People's Development Trust Fund, - The earnings of the
People's Development Trust Fund (PDTF) declared under Section 11 of RA 8425
may be utilized and accessed by the NSCED or accredited SE for the following
purposes
a) Consultancy and training services for SEs and their beneficiaries on the
establishment of the necessary support services such as financial


preparation, fund sourcing, operation of credit and savings entities, monitoring

and evaluation including training on marketing, financial, human resource,

operational and strategic management;

Scholarships or training grants for SE staff and officers, and selected

beneficiaries;

c) Community organizing for SEs;

d) Enterprise start-up and incubation grants for new SEs;

e) SE development and capability building programs, feasibility studies and
researches;

f) Legal and other management support services for SEs such as registration or
accreditation, documentation, contract review and enforcement, audit and
operational assessment;

g) Information dissemination of SE technology and management; and

h) Other activities to support SEs as approved by the designated agency
administering the PDTF

b)

SECTION 25. Tax Exemptions. - An accredited SE shall have the following tax
exemptions:

a) The SE with a net income of not more than Fifteen million pesos
(P15,000,000.00) shall be exempt from all national, city, provincial,
municipal or barangay taxes of whatever name and nature: Provided,
That such net income shall be allocated for transformational services
and other activities of the SE as provided under Section Sg of this Act;

b) Documentary stamp tax;

c) Capital gain tax on sales or exchanges of real property classified as

capital assets or shares of stock: and

For five (5) years after the effectivity of this Act, all SEs duly accredited
by the Council, in consultation with the Department of Finance (DOF)
and the Board of Investment (BO!) of the DTI, shall be exempted from
the payment of tariff and duties for the importation of all types of
product inputs, equipment, machinery, implements, and spare parts:
Provided, That these inputs, equipment, machinery, implements, and
Spare parts shall be for the exclusive use of the importing SEs and can
be shown to be directly related to further improve the value chain
operations ofthe SEs.

The Council shall, in consultation with the DOF and the BOI, within ninety (90)
days from the effectivity of this Act, formulate the implementing rules and regulations
governing the importation of the inputs, equipment, machinery, and implements for
use by the SEs.

For income tax purposes, a reinvestment made by a SE for the expansion of
its socioeconomic projects within the area of its operation shall be tax deductible
from the gross income.

[:)

SECTION 26. Procuring for Social Value. - Social value shall be included in the
eligibility specifications for the procurement of goods and services by government in
all its branches, departments, agencies, subdivisions, and instrumentalities, including
government-owned and controlled corporations and local government units.
Registered small enterprises under RA 6977 that qualify as SE under this Act
shall, consistent with Section 4 of RA 9501, be entitled to a share of at least ten


percent (10%) of total procurement value of goods and services supplied to the
government, its bureaus, offices and agencies annually.

SECTION 27. Incentives for Social Investors. - Social investors and other institutions
that contribute money or other forms of donation in the promotion and development
of SEs shall be entitled to the following tax incentives
‘a) Equity investments and donations to an accredited SE shall be fully

deductible from the gross income of the investor or donor subject to the
conditions of Section 34 paragraph (2) of RA 8424 otherwise known as the
“National Internal Revenue Code of 1997," as amended.
Donations to an accredited SE shall be exempt from donor's tax subject to
the qualifications of Section 101 of RA 8424, as amended

For the purpose of availing of the tax incentives under this Section, the
accreditation of the recipient SE by the Council shall be a sufficient evidence for
qualification as a social investor under this Act

b}

CHAPTER V
APPROPRIATION AND OTHER PROVISIONS

SECTION 28. Appropriations, - To carty out the provisions of this Act, the following
amounts are appropriated as follows:

a) The sum of One hundred million pesos (P100,000,000.00) is hereby appropriated
as the initial operating fund which sum shall be sourced from the President's
Contingent Fund and voluntary contributions, grants and gifts from both local and
foreign sources as may be accepted by the Council. In the subsequent years, the
Council shall have a separate annual appropriation under the DTI which shall be
included in the annual General Appropriations Act starting in the fiscal year
immediately following the approval of this Act;

b) The aggregate sum of Three billion pesos (P3,000,000,000,00) for ten (10) years
is hereby appropriated for the establishment of the SEDF from the share of the
national government in the earings of the PAGCOR and from voluntary
contributions, grants and gifts from both local and foreign sources as may be
accepted by the Council, in the following manner: on the first year, One hundred
million pesos (P100,000,000.00); on the second year, One hundred fifty million
pesos (P150,000,000.00); on the third year, Two hundred million pesos
(P200,000,000.00); on the fourth year, Two hundred fifty million pesos
(P250,000,000.00); on the fifth year, Three hundred million pesos
(P300,000,000.00); and every year thereafter until the tenth year, Five hundred
million pesos (P500,000,000.00) annually.

SECTION 29. Penalty Clause. - The penalty of imprisonment for not less than six (6)
months but not more than two (2) years or a fine of not less than Twenty-five
thousand pesos (P25,000.00) but not more than Fifty thousand pesos (P50,000.00),
or both imprisonment and fine, at the discretion of the court, shall be imposed upon
any person, corporation, government entity or agency wha, intentionally or by gross
negligence, fails to provide the benefits, rights and incentives granted to SEs in
Violation of this Act, or perform any act in violation of its provisions

If the violation is committed by the SE or a government agency, the members,
officers, directors or trustees thereof who are directly involved shall be held liable
therefor.


If the violation is committed by the employees and agents who acted in gross
Violation of the provisions of this Act, the officers, directors or trustees, or
incorporators of the SE shall be jointly and severally liable with the offending
employees, agents, and the enterprise.

If the offender is a public official or employee, the offender shall, upon
conviction, suffer the accessory penalty of absolute disqualification

SECTION 30. Non-Compliance with the Mandatory Allocation of Credit Resources. -

Administrative sanctions including a fine of not less than Five hundred thousand
pesos (P500,000.00) shall be imposed by the Bangko Sentral ng Pilipinas upon any
banking or lending institution who falls to provide the credit allocations granted to SE
in violation of Section 19 of this Act.

SECTION 31. Non-Impairment Clause. - Nothing in this Act shall be construed to
diminish, impair, or repeal the rights granted to marginalized sectors under existing
laws.

SECTION 32. Information Dissemination. - The Philippine Information Agency (PIA)
shall, in coordination with the Council, the DTI, DA, and the DILG, ensure the proper
and adequate information dissemination of the contents and benefits of this Act to
the general public especially to its intended beneficiaries

Within sixty days (60) after its effectivity, the Council shall distribute copies of
this Act to every department, agency, subdivision, and instrumentality of the
government, including government-owned and controlled corporations, regional and
provincial offices, and local governments.

All duly accredited SEs shall be given one (1) copy of this Act at cost
Thereafter, every newly accredited SE shall be issued a copy of this Act together
with the rules and regulations promulgated pursuant to this Act

SECTION 33, PRESENT Program in Government. - All agencies of the government
implementing a poverty alleviation program shall, in coordination with the Council
and within a period of five (5) years but in no case longer than ten (10) years from
the approval of this Act, incorporate the PRESENT Program in their respective
poverty alleviation programs as a tool for poverty reduction

The Council shall, in coordination with the various government agencies with
poverty alleviation programs, prepare the appropriate beneficiaries thereof and
organize them into full-fledged SEs under the contemplation of this Act

Within a period of five (5) years, the Council shall facilitate the development
and dissemination of tools, and invest in the development of the capability of SEs to
plan, monitor and evaluate their social and financial performance and outcomes. The
Council shall evolve socially acceptable benchmarks for evaluating the performance
of SEs and incorporate them to effectively develop and regulate the sector.

SECTION 34. Applicability of Other Laws. - The Labor Code and alll other labor laws,
the Social. Security Act, the Medical Care Act, other social legislations, and all other
laws and executive orders that govern the relationship between the employer and
the employee shall apply to SE and its employees and that all employees covered
under this Act shall be entitled to the same benefits given to any regular employee
such as social security and healthcare benefits.


SECTION 35. Interpretation and Construction. - In case of doubt in the meaning of
any provision of this Act or in the rules and regulations promulgated pursuant to this,
Act, it shall be resolved in favor of SEs and their stakeholders.

SECTION 36. Congressional Oversight Committee. - There is hereby created a
Congressional Oversight Committee on Social Enterprises composed of the
Chairman of the Senate Committee on Economic Affairs, Trade and Commerce and
the Chairman of the House Committee on Trade and Industry, four (4) members of
the Senate and four (4) members of the House of Representatives. The members
from the Senate shall be appointed by the Senate President from among the
members of the Senate Committee on Economic Affairs, Trade and Commerce
based on the proportional representation of the parties or coalition therein, The
members from the House of Representatives shall be appointed by the Speaker from
among the members of the House Committee on Trade and Industry based on the
proportional representation of the parties or coalitions therein

The Oversight Committee, upon review and approval of the Implementing
Rules and Regulations of this Act shall become functus officio and thereafter cease
to exist; Provided, however, That the Council shall submit to the Committee on
Economic Affairs, Trade and Commerce of the Senate and the Committee on Trade
and Industry of the House of Representatives an annual report on the
implementation of this Act

The appropriation for the oversight committee shall be charged to the budget
of both Houses of Congress in the annual General Appropriations Act.

SECTION 37. Social Enterprise Week. - In order to institute continuing awareness on
the importance of SEs as a viable government strategy in pursuing poverty
alleviation, the week of the month when this Act shall have been signed into law shall
be declared as the "Social Enterprise Week" and shall be celebrated annually, The
Council shall, through the NCSED, be responsible in organizing activities for the
event.

CHAPTER V
FINAL PROVISIONS
SECTION 38. Implementing Rules and Regulations. - Within ninety (90) days from
the effectivity of this Act, the Secretary of Trade and Industry shall, in consultation
and coordination with the concerned government agencies and sector, promulgate
the necessary rules and regulations for the effective implementation of this Act.

SECTION 39. Repealing Clause - All laws, issuances, rules and regulations
inconsistent with any provision of this Act shall be deemed amended, modified, or
repealed accordingly.

SECTION 40. Separability Clause - If, for any reason, a provision or part hereof is
declared invalid or unconstitutional, the other provisions not affected thereby shall
remain in full force and effect.

SECTION 41. Effectivity - This Act shall take effect fifteen (15) days after its
publication in any newspaper of general circulation

Approved,