Republic of the Philippines é
HOUSE OF REPRESENTATIVES
Quezon Cit

RECE| ven @
ve: 23 JUL 70;

SIXTEENTH CONGRESS.

First Regular Session
tera
HOUSE BILLNO. “| 9

Introduced by

HON. GUSTAVO S. TAMBUNTING

EXPLANATORY NOTE

Section 20 of Article Il of the 1987 Constitution declares that the State shall prioritize
science and technology, recognize the indispensable role of the private sector and
encourage private enterprise through providing incentives. Section 24 of Article 1! also
declares that the State shall recognize the vital role of communication and information in
nation-building, and Section 12 of Article XIV provides that the State shall promote the
adaptation of technology from all sources for the national benefit.

Presently,swe are living in internet-age with gadget-driven people. With this
worldwide trend Wwe need to cope with this fast-pace change to keep up with the demands
of the international situation. Thus, there is a need to support and develop the information
technology sector beginning with small start-up companies that are expected to grow and
expand quickly notwithstanding a minimal capital. In doing so, our country will be able to
take on business prospects of the global market including employment opportunities
catered via the internet.

Unfortunately, reports have shown that we are lagging behind the rest of the world.
The Global Information Technology Report 2013, “analyzes the impact and influence of
information communication technology on economic growth and jobs in a hyper connected
world.” The Networked Readiness index, on the other hand, measures the preparedness of
the economy to use ICT to boost competitiveness and well-being. Based on The Networked
Readiness Index 2013 from the Global Information Technology Report 2013, the Philippines
ranked at 86" out of 142 countries. Neither was there improvement as our country has
remained stagnant in such position for 2012 and 2013. With a score of 3.73 in comparison
with 5.98 garnered by Finland as the leading country in the report, it is apparent how far our
country still needs to catch up.



Accordingly, we are lagging considering that our country has failed to create a
sufficiently conducive environment for innovation and competitiveness as provided in the
report. Thus, to respond to this failure, this bill is filed to foster the promising industry of
information technology in our country through the development of information technology
in start-up companies. In. order to materialize this goal, the bill provides for the
establishment of an IT venture capital fund. Parenthetically, we will be empowering the
poor by affording them access to IT services, and boost the competitiveness of Filipinos
through development of human resources as well as our own IT sector through promotion
of research and development. In the end, our country will be properly and readily prepared
in the demands of the world.



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

‘SIXTEENTH CONGRESS
st Regular Session

House ait no. 1657'S

Introduced by

HON. GUSTAVO S. TAMBUNTING

AN ACT TO ACCELERATE THE DEVELOPMENT OF INFORMATION TECHNOLOGY START-UP
COMPANIES BY PROVIDING AN IT VENTURE CAPITAL FUND.
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 “IT Venture Capital Fund of
2013.”

SECTION 2. Declaration of Policy. ~ Recognizing the indispensable role of the IT
sector in driving modern business and enterprise as well as the national economy, it shall be
the policy of the State to accelerate the development of information technology (IT) venture
companies consistent with Sections 9, 20 and 24 of Article Il and Section 12, Article XIV of

the Constitution.

SECTION 3. Creation of IT Venture Capital Fund. - The amount of One Billion Pesos
(P1,000,000,0000.00) is hereby appropriated as IT venture capital fund (ITVCF), to be
administered by the Department of Science and Technology (DOST), to cover the initial
investment requirement of small technology start-up companies as provided for in this Act.
Funding for this Act shall come from the special appropriations by the Department of
Budget and Management (DBM) and from the budget surplus which shall be maintained by
the DOST.


SECTION 4. Beneficiaries. — The following shall be the beneficiaries of this Act: small
technology start-up companies engaged in high-value technology e-services and products
based on a set criteria to be laid down by the DOST for the purpose, such as, but not limited

to!

a. Web portals

b. Real time messaging softwares
c. E-groups

d. On-line music and video sharing

, Web logging or blogging

f. Animation

g. Webdesign
h. Video games
i. On-line gaming

j. Data warehousing
SECTION 5. Implementing Rules and Regulations. - The DOST shall formulate the

implementing rules and regulations wi

in sixty (60) days from the effectivity of this Act.

SECTION 6. Separability Clause. - Should any part or provision of this Act be declared
unconstitutional or invalid, other parts or provisions hereof not otherwise affected thereby

shall remain in full force and effect.

SECTION 7. Repealing Clause. All laws, executive orders, rules and regulations or any
part thereof inconsistent with the provisions of this Act are deemed repealed or modified

accordingly.

SECTION 8. Effectivity. — This Act shall take effect fifteen (15) days after its

publication in at least one (1) newspaper of general circulation.

Approved,