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23 SEP 12 P7 40
NINETEENTH CONGRESS 
)
REPUBLIC OF THE PHILIPPINES 
)
Second Regular Session 
)
RECEIVED BY;
;.nSoENW39
(In Substitution of S. Nos. 9, 1914, and 2041, taking into consideration H. No. 8443)
Prepared and submitted jointly by the Committee on Economic Affairs (upon 
recommendation of its Sub-Committee on PENCAS Law and Blue Economy); Committees 
on Environment, Natural Resources and Climate Change; and. Finance with Senators 
Legarda, Revilla, Jr., and Villanueva as authors thereof
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AN ACT
INSTITUTIONALIZING THE PHILIPPINE ECOSYSTEM AND NATURAL CAPITAL 
ACCOUNTING SYSTEM, MANDATING ITS USE IN POLICY AND DECISION­
MAKING, DESIGNATING THE AGENCIES RESPONSIBLE FOR ITS 
IMPLEMENTATION, PROVIDING INSTITUTIONAL ARRANGEMENTS AMONG 
RESPONSIBLE AGENCIES, 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 Ecosystem 
and Natural Capital Accounting System (PENCAS) Act".
SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State to:
(a) Recognize natural ecosystems as an integral part of our patrimony and heritage;
(b) Protect and promote ecological balance and resilience, and advance the right of 
the people to live in harmony with nature;
(c) Adhere to internationally accepted System of Environmental-Economic Accounting 
(SEEA) that measures and monitors the dynamic interaction and intersections of 
the environment, economy and society;
(d) Develop a comprehensive information system and accounting framework that will 
take into consideration the role of our natural capital, consisting of both


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environmental and natural resources including ecosystem services, and its impact 
on the economy;
(e) Compile and progressively integrate natural capital accounts in macroeconomic 
indicators, strengthening and building on Republic Act (RA) No. 10625, otherwise 
known as the "Philippine Statistical Act of 2013", which mandates the compilation 
of national accounts, including environmental accounts, statistics, and indicators;
(f) Provide indicators that will facilitate the integration of environmental and natural 
resource concerns in planning and policymaking at the national and subnational 
levels, in allocating budgets, and in designating statistics that will be produced 
regularly for an identified period of analysis;
(g) Establish and improve interagency coordination for the purpose of linking natural 
capital information as well as efficient data management among concerned 
agencies and their partner institutions, and establish an office to guide such 
coordination; and,
(h) Understand nature's pricelessness, its heritage and intrinsic value, and its 
interdependencies in the implementation of the foregoing policies to consider that 
nature and ecosystems have inherent rights to exist, with an end view of 
recognizing legal rights that serve to protect endangered ecosystems and applying 
the precautionary principle, especially when economic values cannot be estimated. 
SEC. 3. Definition of Terms. - As used in this Act:
(a) Ecosystem refers to all living things in a given area, as well as their interactions 
with each other, and with their non-living environments (weather, earth, sun, soil, 
climate, atmosphere, water, etc.).
(b) Ecosystem accounting refers to a coherent framework for integrating measures of 
ecosystems and flows of services from them with measures of economic and other 
human activity.
(c) Ecosystem services refer to the benefits supplied by the functions of ecosystems 
and received by humanity and all elements of living systems, which support life 
systems on the planet. Ecosystem services consist of provisioning services, 
regulating and maintenance services, and cultural services.
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{6) Environmental indicators axe. environment statistics that have been selected for 
their ability to depict important phenomena or dynamics. Environmental indicators 
are used to synthesize and present complex environment and other statistics in a 
simple, direct, clear and relevant way.
(e) Natural capita! refers to the stock of renewable and non-renewable resources, 
including plants, animals, air, water, soils, ores, and minerals, that provide a flow 
of benefits to people and living things. Natural capital includes but is not limited 
to ecosystem services such as air and water filtration, flood protection, carbon 
sequestration, pollination of crops, and habitats for wildlife.
(f) Natural Capital Accounting (NCA) refers to an accounting framework that provides 
a systematic way of measuring and reporting on stocks and flows of natural capital. 
NCA covers accounting for individual environmental assets or natural resources, 
both biotic and abiotic such as water, ores, minerals, energy, timber, and fish, as 
well as accounting for ecosystem assets, biodiversity, and ecosystem services.
(g) System of Environmental-Economic Accounting (SEEA) refers to a framework that 
integrates both economic and environmental data to provide a more 
comprehensive and multipurpose view of the interrelationships among the 
economy, the environment and ecosystems, and the stocks and changes in stocks 
of natural assets, as they bring benefits to humanity.
(h) Valuation refers to determining the value or worth, in both physical and economic 
terms, of natural capital and the services it provides at national and subnational 
levels.
SEC. 4. Philippine Environmentai and Naturai Capitai Accounting 
System. - The Philippine Ecosystem and Natural Capital Accounting System (PENCAS) 
is hereby institutionalized within the government bureaucracy. The PENCAS shall be 
based on internationally accepted environmental-economic accounting frameworks. The 
PENCAS framework shall include, among others, a list of the officially designated statistics 
on the depletion, degradation, and restoration of natural capital; environmental 
protection expenditures; pollution and quality of land, air and water; environmental 
damages; and adjusted net savings.
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SEC. 5. Objectives of the PENCAS. - The PENCAS shall have the following 
major objectives:
(a) Support economic, environmental, and health policy development and decision­
making;
(b) Provide a system for the collection, compilation, and development of physical and 
natural capital accounts in the government as a tool for physical and development 
planning and programming, policy analysis, and decision-making;
(c) Serve as a comprehensive data framework in the generation of natural capital 
statistics and accounts towards their progressive integration in macroeconomic 
indicators;
(d) Provide tools and measures that contribute to the protection, conservation, and 
restoration of ecosystems; and,
(e) Provide valuation of ecosystem services such as provisioning, regulating and 
maintenance, and cultural services.
SEC. 6. Institutional arrangement for the implementation of PENCAS. -
To ensure the effective implementation of PENCAS, the following bodies shall be tapped:
(a) The Philippine Statistics Authority (PSA) Board shall oversee the implementation 
of PENCAS.
(b) The PSA Board shall direct the relevant interagency committees created under 
Section 10 of RA 10625 to assist the PSA in addressing agency and sectoral 
concerns that may arise in the development of natural capital accounts, particularly 
on the (i) techniques and methodologies in generating environment and natural 
resources statistics; (ii) areas of duplication, discrepancies, and gaps; and, (Hi) 
workable schemes for the improvement of data systems of accounts including 
production, dissemination and archiving of data and information.
The Interagency Committee on Environment and Natural Resources 
Statistics (lACENRS) shall provide support in ensuring that data requirements for 
NCA are being generated by all concerned agencies. It shall adopt, implement, 
and update an NCA roadmap that will (i) guide short-term, medium-term, and 
long-term activities for natural capital accounts development; and, (ii) prioritize
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areas for budget support and monitoring and evaluation of NCA implementation in 
the country.
(c) A Technical Working Group (TWG) on NCA shall be established under the lACENRS. 
The TWG shall consist of the PSA as lead accounts compiler, Department of 
Environment and Natural Resources (DENR) as main data producer, National 
Economic and Development Authority (NEDA), and the Department of Agriculture 
(DA). The PSA shall serve as chair and shall provide secretariat support to the 
TWG. The TWG shall perform the following roles and responsibilities:
(i) 
Provide immediate support to achieve the priority activities across all 
components of the NCA Roadmap such as securing budgetary or financial 
and technical support and collaborating with development partners for 
project preparation and implementation;
(ii) 
Serve as a forum for discussion and resolution of issues and concerns in the 
compilation, processing, and dissemination of natural capital and ecosystem 
statistics and accounts and other related indicators in terms of accuracy, 
completeness, timeliness, and relevance;
(iii) 
Review and recommend enhancements on the concepts, techniques, and 
methodologies used in the collection, processing, and reporting of natural 
capital and ecosystem statistics and accounts to ensure conformity with the 
prescribed statistical standards and classification system;
(iv) 
Identify and recommend statistical measures, strategies, and policies for 
the improvement of natural capital and ecosystem statistics and accounts 
to lACENRS;
(v) 
Recommend improvements in the methodology of compiling natural capital 
and ecosystem statistics and accounts, and formulate measures to ensure 
that the data requirements of the same are being generated and addressed 
by all concerned agencies;
(vi) 
Prioritize outputs that will address the more urgent statistical requirements 
in the Philippine Statistical Development Program, including those required 
to monitor and measure the accomplishment of relevant chapters of the
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Philippine Development Plan and its Results Matrices, and the Philippines' 
obligations in multilateral environmental agreements; and,
(vii) Update the PSA Board and the lACENRS on developments in natural capital 
and ecosystem statistics and accounts.
SEC. 7. Specific Functions of Nationai Government on PENCAS. - The
following agencies shall have the following specific roles and responsibilities in the 
implementation of this Act:
(a) The PSA shall have the overall responsibility for the institutionalization and 
progressive implementation of PENCAS following the SEEA framework. It shall 
develop and maintain the compilation of natural capital accounts as well as the 
environmental and ecosystem accounts at the national and, as necessary, at the 
sub-national levels. It shall coordinate with and provide technical support to 
interagency committees, task forces, technical working groups, national 
government agencies, and local government units (LGUs) in the generation, 
compilation, and use of environmental accounts, statistics, and indicators. In 
coordination with concerned agencies, it shall designate the required environment 
and economic statistics in agencies and bureaus responsible for generating data.
The PSA shall create a service to be referred to as Environment, Natural 
Resources and Ecosystem Account Service (ENREAS), under the Sectoral Statistics 
Office, necessary for the implementation of this Act, subject to the evaluation and 
approval of the Department of Budget and Management (DBM), and in compliance 
with the Civil Service laws, rules, regulations, and guidelines.
(b) The DENR shall be responsible for providing NCA data to PSA. The DENR shall 
ensure the participation of its concerned offices, bureaus and attached agencies. 
It shall spearhead the setting up of site-specific ecosystem accounts.
The DENR, in line with its mandate, shall continue to uphold and convey 
that the natural environment, biodiversity and the multitude of ecosystem services 
that nature provides are opportunities, benefits or assets as opposed to being 
merely a backdrop to absorb impacts. It shall communicate and instill to all 
stakeholders the importance of accounting and valuation of ecosystems services
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and their benefits to people. The DENR shall ensure the wide availability of tools, 
methods and skills that can support the consideration of ecosystem services, and 
ensure the inclusion of such in the implementation of all its mandates in the 
development of the implementing rules and regulations (IRR), further including in 
such rules accounting for activities that may degrade natural capital.
To perform the foregoing functions, the DENR shall be strengthened 
through the creation of new plantilla positions, subject to existing laws, rules and 
regulations.
(c) The NEDA, including its regional offices, shall ensure that NCA is included in the 
national and regional development priorities based on the usefulness of the 
accounts in policy analysis, development planning, and investment programming. 
It shall provide strategic guidance on improving uptake on policy use and 
application, enhancing institutional capacity, and raising awareness and 
transparency of NCA work.
(d) The Department of Agriculture (DA) shall assist the PSA in the generation and 
provision of the NCA information relative to agricultural areas, and fisheries and 
aquatic resources, and closely coordinate on associated ecosystem NCA with the 
DENR. The Bureau of Fisheries and Aquatic Resources (BEAR), in line with its 
mandate, shall provide support in the creation of data and information on fisheries 
valuation and accounting. The National Fisheries Research and Development 
Institute (NFRDI) shall continue to conduct research and development activities 
and studies to support the assessment, including the profiling of the status of fish 
stocks of the country. The Bureau of Soils and Water Management (BSWM) shall 
ensure that NCA is considered to ensure soil fertility and hydrological stocks and 
services. Further, the DA, BEAR, BSWM, and NFRDI shall create national capital 
units through additional plantilla positions, subject to existing laws, rules and 
regulations, and approval of the DBM.
(e) The Department of the Interior and Local Government (DILG) shall consolidate 
and submit NCA-related data and statistics from local governments to PSA and


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DENR. Further, the DILG shall ensure that LGUs utilize and mainstream NCA into 
their local policies, plans, and programs.
(f) The Department of Education (DepEd), Commission on Higher Education (CHED), 
Technical Education and Skills Development Authority (TESDA), and state 
universities and colleges (SUCs) shall craft modules in all levels and modalities of 
basic, technical, vocational, and higher education to capacitate the citizenry to 
avail of participatory mechanisms in relation to PENCAS.
(g) The Professional Regulation Commission (PRC) shall incorporate NCA concepts in 
the continuing professional education programs and develop the understanding of 
the impact of different professions on the environment.
(h) The Department of Finance (DOF) shall integrate NCA considerations into fiscal 
policies and regulations, and develop incentive mechanisms that will drive NCA 
investments.
(i) The Department of Energy (DOE) and Department of Human Settlements and 
Urban Development (DHSUD) shall integrate NCA considerations into the 
performance of their mandate, and ensure that its planning and decision-making 
consider natural capital.
SEC. 8. Participation of Specific Bureaus Within the Agencies. The
following offices shall contribute to the collection, generation, analysis and presentation 
of statistics and data requirements of the PENCAS:
(a) All bureaus of the DENR, and the National Mapping and Resource Information 
Authority (NAMRIA);
(b) National Water Regulatory Board (NWRB);
(c) The bureaus of the DA, especially the BFAR, the BSWM, Philippine Fisheries 
Development Authority (PFDA), Philippine Rice Research Institute (PRRI), 
National Irrigation Administration (NIA) and the Philippine Coconut Authority 
(PCA);
(d) National Renewable Energy Board (NREB);
(e) Research and development institutes, and science and technology services, 
especially the Philippine Atmospheric, Geophysical and Astronomical Services
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Administration (PAGASA) and the Philippine Institute of Volcanology and 
Seismology (PHIVOLCS) of the Department of Science and Technology (DOST);
(f) And other bureaus, as necessary.
SEC. 9. Involvement of Other Stakeholders. -The TWG on NCA shall involve 
other relevant agencies, private sector, and nongovernment organizations, including 
indigenous peoples and local communities, in the implementation of PENCAS, particularly 
on the generation and provision of NCA data as well as the use of natural capital and 
ecosystem accounts.
Subject to the implementing rules and regulations of this Act and national security 
concerns, all stakeholders shall regularly publish NCA information on their website and/or 
such other medium deemed appropriate.
SEC. 10. Participatory Mechanisms and Citizen Remedies. - The concerned 
agencies shall institute consultative mechanisms, and mass collaboration measures to 
effectively popularize PENCAS and ensure wide comprehensibility and usage of the 
accounts.
Any citizen shall have the right to information on any account generated under 
this Act, to have the standing to compel the performance of any of the mandates under 
this Act, and to seek justification from any government agency that may have ignored or 
neglected PENCAS accounts and indicators in their policy or decision-making. Major 
PENCAS accounts, results on nature's wealth and the economic value of ecosystem 
services, and loss and damage associated with disasters or climate change, shall be 
released along with all releases of national economic data, such as Gross National Income 
(GNI), Gross Domestic Product (GDP), and other often-released measures of the state of 
the country's economic health and highlight the contribution of resources and ecosystems 
to the economy, incomes and employment.
SEC. 11. Rights of Nature. - Nothing in this Act shall be construed to mean that 
nature has no inherent and intrinsic value separate and distinct from its economic value.
SEC. 12. The PENCAS shall be fully considered in the implementation of the 
Philippine Environmental Impact Statement System.


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SEC. 13. Appropriations. - The amount necessary to cover the initial 
implementation of this Act shall be charged against the current year's appropriations of 
the departments or agencies concerned. Thereafter, the amount necessary for its 
continued implementation shall be included in the respective budgets of the departments, 
agencies concerned in the annual General Appropriations Act.
SEC. 14. Impiementing Ruies and Reguiations. — Within one (1) year from 
the effectivity of this Act, the PSA shall constitute an interagency working group, 
composed of the agencies and offices enumerated under Sections 6 and 7 of this Act, to 
issue the rules and regulations necessary for the effective implementation of this Act.
The relevant agencies shali integrate internationally recognized best practices and 
methodologies as they execute and implement this Act and its rules and regulations, 
ensuring the progressive integration of the SEEA.
The Implementing Rules and Regulations of this Act shall include the timeframe, 
manner and such other details regarding the collection, renewal, and review of NCA data 
by government agencies and other stakeholders.
SEC. 15. Separabiiity Ciause. - If any provision of this Act is declared 
unconstitutional or otherwise invalid, the validity of the other provisions shall not be 
affected thereby.
SEC. 16. Repeaiing Ciause. - All other laws, decrees, orders, rules and 
regulations, other issuances, or parts thereof inconsistent with the provisions of this Act 
are hereby repealed or modified accordingly.
SEC. 17. Effectivity. - This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette ov in a newspaper of general circulation.
Approved,
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