Republic of the Philippines
HOUSE OF REPESENTATIVES
Quezon City, Metro Manila

EIGHTEENTH CONGRESS
First Regular Session

1417

HOUSE BILL NO.

Tntwoduced by Rep. Wilfride Mark M. Enverga

This bill seeks to re- introduce the coconut levy bill submitted by Congress of
the Philippines during the 17% Congress to the Executive Department for signing,
However the President for valid reasons vetoed the bill and urged Congress to craft a
better law that would protect public funds from irregularities, reflect the ultimate goal
of accelerating the full use of coconut levy assets and funds for the benefit of coconut
farmers and the coconut industry.

With the introduction of some amendments to the bill, along with other
provisions consistent with the previous bills filed and supported by the author in the
previous congresses, optimistically the new bill will complements with other proposed
legislations in the congress that will finally paved the way for a law acceptable to all

sectors of the industry.

In view of the foregoing, approval of this proposed measure is earnestly
soughit.

worn es


Republic of the Philippines
HOUSE OF REPESENTATIVES
Quezon City, Metro Manila

EIGHTEENTH CONGRESS
First Regular Session

HOUSE BILL NO. 1417

Tnboduced by Rep. Wilfride Maxk M. Envergas

AN ACT ESTABLISHING THE COCONUT FARMERS AND INDUSTRY
TRUST FUND AND PROVIDING FOR ITS MANAGEMENT AND UTILIZATION

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 “Coconut Farmers and
Industry Development Act of 2019",

SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State to attain the
balanced, equitable, integrated and sustainable growth and development of the coconut
industry. Towards this end, the benefits due to coconut farmers, especially the poor and
the marginalized, under various statutes shall be consolidated and their delivery

expedited.

CHAPTER
DEFINITION OF TERMS

SEC. 3, Definition of Terms. ~ As used in this Act:
(a) Coconut Industry Investment Fund (CIF) refers to the Fund created pursuant to

Presidential Decree No. 1468, which authorized the United Coconut Planters Bank
(UCPB) to utilize the surplus funds from the Coconut Consumers Stabilization Fund


(CCSF) and the Coconut Industry Development Fund (CIDF) for investments in the form
of shares of stock in corporations organized for the purpose of engaging in the
establishment and operation of industries, commercial activities and other allied
business undertakings relating to the coconut and other palm oils industry in all its
aspects and the establishment of a research into the commercial and industrial uses of

coconut and other palm oil industry;

(b) CIIF Holding Companies refer to the fourteen (14) holding companies, namely: (1)

Anglo Ventures Corporation; (2) ACS Investors, Incorporated; (3) Arc Investors,
Incorporated; (4) AP Holdings, Incorporated; (5) Fernandez Holdings, Incorporated; (6)
First Meridian Development, Incorporated; (7) Randy Allied Ventures, Incorporated; (8)
Rock Steel Resources, Incorporated; (9) Roxas Shares, Incorporated; (10) San Miguel
Officers Corporation, Incorporated; (11) Soriano Shares, Incorporated; (12) Te Deum
Resources, Incorporated; (13) Toda Holdings, Incorporated; and (14) Valhalla
Properties Limited, Incorporated, created by the CIIF Oil Mills Group to acquire, hold
and manage the shares of stocks of San Miguel Corporation (SMC);

(c) CIF Oil Mills Group refers to the six (6) CHF companies, namely: (1) Southern Luzon
Coconut Oil Mills; (2) Cagayan de Oro Oil Company, Incorporated; (3) Higan Coconut
Industries, Incorporated; (4) San Pablo 3 Manufacturing Corporation; (5) Granexport
Manufacturing Corporation; and (6) Legaspi Oil Company, Incorporated, acquired by the
UCPB using the CIIF;

(a) CIIF SMC Block Shares refer to the thirty-three million, one hundred thirty-three
thousand and two hundred sixty-six (33,133,266) shares of stock in SMC, sequestered
by the Presidential Commission on Good Government (PCGG) in April 1986
representing thirty-one percent (31%) of the total outstanding capital stock of SM

(e) Converted SMC Series 1 Preferred Shares refer to that portion of the CIIF SMC Block
Shares covering seven hundred fifty-three million, eight hundred forty-eight thousand
and three hundred twelve (753,848,312) preferred shares of stock in SMC representing
twenty-four percent (24%) of the outstanding capital stock of SMC;


(f Coconut farmer refers to: (1) Farmer-owner of a coconut farm, which is not more
than five (5) hectares, who: (i) Tills the land (owner-cultivator); or (ii) Does not till the
land, but has control and supervision over the cultivation of a farm which is not more
than five (5) hectares; and (2) A non-owner of the coconut farm who is either a: (i)
Leaseholder or tenant who tills or supervises the cultivation of the farm; or (ii) Farm
worker or laborer, whether seasonal or itinerant, engaged in the harvesting of the nuts

and processing of copra as major means of livelihood,

(g) Coconut Levy Assets refer to any and all kinds of property, whether real or personal,
tangible or intangible, wherever situated, which have been acquired through or
otherwise funded by the Coconut Levy Funds, including those assets that may be
recovered in favor of the Government, as well as the 4 fruits or income derived
therefrom, including those acquired in exchange or substitution thereof, including the
following: (1) The shares of stock in the UCPB determined to be owned by the
Government; (2) The CIIF Oil Mills Group; (3) The CIIF Holding Companies; and (4) The
Converted SMC Series 1 Preferred Shares.

(h) Coconut Levy Funds refer to various funds generated from levies, taxes, charges, and
other fees exacted or imposed pursuant to or in connection with the sale of copra
rececada or its equivalent in other coconut products, and collected for the most part
from coconut farmers, planters, millers, refiners, processors, exporters, desiccators and
other end users of copra rececada or its equivalent in other coconut products. These
shall refer to any and all of the following:

(1) The Coconut Investment Fund created under Republic Act No. 6260;

(2) The Coconut Consumers Stabilizi

tion Fund, later renamed as the Coconut Industry
Stabilization Fund, created under Presidential Decree No. 276;

(3) The Coconut Industry Development Fund created under Presidential Decree No.
582; (4) The Coconut Industry Investment Fund created pursuant to Presidential
Decree No. 1468; and

(5) The Coconut Reserve Fund under Presidential Decree No. 1468 and Presidential
Decree No. 1842.


() Investment guidelines refer to the investment management guidelines, rules,
procedures, and policies to be formulated by the Coconut Farmers and Industry Trust
Fund Committee created under Section 11 of this 5 Act, and as may be amended from
time to time, which shall provide the parameters for investments of the Trust Income or
any portion thereof, and shall include, among others, asset allocation, criteria for
selection of fund managers, required income from the fund, and other investment

management threshold requirements.

(j) Trust Income refers to the income, interest earnings, and other monetary benefits,
realized by and accruing to the Trust Fund or any portion thereof.

(k) Trust Principal refers to:

(1) The initial Trust Principal composed of dividends declared, paid, or issued on the
Converted SMC Series 1 Preferred Shares; the proceeds from the redemption of the
Converted SMC 1 Preferred Shares; all income or interest derived therefrom as of the
effectivity of this Act; any other cash Coconut Levy Asset deposited in the Bureau of the
‘Treasury (BTr) and the UCPB as administrator of the CIIF; and any other cash Coconut
Levy Asset including amounts deposited in the UCPB as Administrator of the CIIF;

(2) Any and all proceeds of privatization of the Coconut Levy Assets remitted thereto by
the Privatization and Management Office (PMO), organized under Article III of Executive
Order No. 323 (Series of 2001); and

(3) Proceeds of privatization of any or all properties or assets conveyed by any person,
group or entity to the Committee, from time to time, as provided in Section 8 hereof.

CHAPTER II
AUDIT AND RECONVEYANCE OF COCONUT LEVY ASSETS

SEC. 4, Audit and Inventory of Coconut Levy Assets. - Upon the effectivity of this Act, the
PCGG, created under Executive Order No. 1 (Series of 1986), shall conduct a complete
accounting and inventory of the Coconut Levy Assets as well as the investments,

disbursements, and expenditures 6 relating to the coconut levy fund and submit a


certified report to the BTr, the Commission on Audit (COA) and the Office of the
President (OP). The COA shall audit the inventory of Coconut Levy Assets prepared and
submitted by the PCGG for the purpose of, among others, determining completeness of
the inventory, establishing the reasonableness of the asset valuation and tracing of the
flow of the coconut levy fund. The COA shall submit to the Coconut Farmers and
Industry Trust Fund Committee created under Section 11 hereof its initial audit report
within one hundred twenty (120) days upon completion of the audit. However, further
audit may be undertaken after the initial audit, as necessary. The Committee shall, .
within fifteen (15) days from its receipt of the audit report, publish the same in at least
two (2) newspapers of national circulation. Nothing herein shall be construed as
preventing the PMO, created under Article III of Executive Order No. 323 (Series of
2001), from procuring a third-party appraisal of any of the Coconut Levy Assets prior to

or in the course of preparing the privatization or disposition plans for the said assets.

SEC. 5. Reconveyance of Coconut Levy Assets. - Immediately upon the effectivity of this
‘Act, the PCGG, the government representatives to the boards of
sequestered/surrendered corporations, and any government agency or person in
possession, custody, control or administering any Coconut Levy Asset shall perform or
cause the performance of the following:

(a) Reconveyance of the title of such asset to the Republic of the Philippines;

(b) Delivery of all stock certificates and other evidence of ownership to the BTr for
safekeeping; and

(c) Deposit all cash assets in the Trust Fund. 7 Any provision of law to the contrary
notwithstanding, the BTr and the UCPB shail directly remit the initial Trust Principal to
the Trust Fund, The COA shall conduct an audit to determine compliance with pertinent
laws, rules and regulations on reconveyance of the Coconut Levy Assets to the Republic

of the Philippines.

CHAPTER III
COCONUT FARMERS AND INDUSTRY TRUST FUND

SEC. 6. The Coconut Farmers and Industry Trust Fund. - There is hereby created a trust

fund to be known as the Coconut Farmers and Industry Trust Fund, hereinafter referred


to as the Trust Fund, which shall consist of the Trust Principal and the Trust Income. No
portion of the Trust Fund shall accrue to the general fund of the National Government. It
shall be capitalized, managed, utilized and accounted for in the manner provided in this
Act. Nothing in this Act shall be understood to prevent or prohibit any person, group or
entity from conveying to the Committee other properties and/or additional assets
either for the use of the coconut industry, or for purposes of privatization, in which case,
the proceeds of such privatization shall form part of the Trust Fund.

SEC. 7. Purpose of the Trust Fund. - The Trust Fund shall be used exclusively for the
ultimate benefit of coconut farmers and farm workers as embodied in the Coconut

Farmers and Industry Development Plan prepared pursuant to Section 20 hereof.

SEC. 8. Capitalization of the Trust Fund. ~ All assets and/or properties derived from all

coco levy recovered assets; and all dividends, interest earnings and incomes that are

available upon the effectivity of this Act shali form part of the initial capital of the Trust
Fund, The Trust Fund shall thereafter be augmented with all proceeds of
privatization/disposition of the Coconut Levy Assets remitted directly thereto by the
PMO in accordance with this Act, 8 including any and all forms of income, interests,
earnings, yields, or any monetary benefit derived therefrom prior to the
privatization/disposition of these Coconut Levy Assets. In order to ensure the enduring
character of the ‘Trust Fund, the Principal thereof shall be augmented by grants,
donations and other lawful transfers by public or private entities, At the end of the year,
all unspent porcion of the Trust Income for the year shall accrue to the Trust Principal.

SEC. 9. Management and Utilization of the Trust Fund. ~ The Trust Fund shall be
available and may be utilized only for the purpose for which it was created and upon

authorization of the Committee, subject to the following conditions:
(a) The Trust Principal shall be preserved and maintained at all times and only the Trust
Income may be used.

(b) The Trust Income shail be disbursed only on the basis of the funding requirement of

the program, activity or project;


(c) The Trust Fund may also be disbursed to pay for the expenses of the Committee for
the administration, monitoring, evaluation, information services, and other necessary

activities for the effective performance of its functions under this Act; and

(d) No part of the Trust Fund shall be utilized for the payment of salaries and other
personnel benefits. All releases from the Trust Fund approved by the Committee shall
be released directly to the implementing agencies:

SEC. 10. Designation of the Bureau of the Treasury as Depository of the Trust Fund. ~
The Trust Fund shall be deposited in the BTr. The BTr shall account for the Trust Fund
in the manner provided by the Committee and shall perform such duties as may be
determined by the Committee.

CHAPTER IV COCONUT FARMERS AND INDUSTRY TRUST FUND COMMITTEE

SEC. 11. Creation of the Coconut Farmers and Industry Trust Fund Committee. - The
Coconut Farmers and Industry Trust Fund Committee, hereinafter referred to as the
Committee, is hereby created under the Office of the President. The Committee shall
have the following powers and functions:

(a) Coordinate and monitor the implementation of the Coconut Farmers and Industry
Development Plan;

(b) Approve any allowable disbursement out of the Trust Fund;

(c) Formulate the Investment Guidelines including the Prohibited Investments;

(d) Appoint a fund manager, if necessary, to handle the investment of the Trust
Principal; (e) Identify the Coconut Levy Assets that will be privatized, retained, or
abolished and submit its recommendation to the President;

(0 Approve the marketing and disposition program for the Coconut Levy Assets
approved for privatization;

(g) Authorize the sale and other mode of privatization of Coconut Levy Assets approved
for privatization;

(h) Authorize the rehabilitation of Coconut Levy Assets approved for privatization

pending actual disposition;


(i) Facilitate access by coconut farmers and their organizations from the most poverty
afflicted areas of the country to the services, programs and benefits implemented
pursuant to the Coconut Farmers and Industry Development Plan. For purposes of this
Act, those already accredited farmers organizations need not go through another
accreditation process;

(j) Submit to the President reports and recommendations in connection with its
functions under this Act; and

(k) Exercis
the objectives of this Act.

such other incidental powers and functions as may be necessary to attain

SEC. 12. Composition. ~ The Committee shall be composed of the following:
(a) Five (5) representatives from the government who shall be serving in ex

officio capacity: (1) The Secretary of the Department of Agriculture (DA) as

Chairperson; (2) The Secretary of the Department of Finance (DOF) as Vice
Chairperson; (3) The Secretary of Agrarian Reform (DAR); (4) The Director-

General of the National Economic and Development Authority (NEDA); and

(5) The Administrator of the PCA.

(b) Six (6) representatives from the coconut farmers’ organizations who have

considerable experience and reputable track records, allocated as follows:

‘Two (2} representatives from Luzo!

f (2) Two (2) representatives from

Visayas; and (3) Two (2) representatives from Mindanao.

Within thirty (30) days following the effectivity of this Act, the PCA shall promulgate a
selection process of nominees as representatives of the coconut farmers’ organizations
in the Committee. The nominees of the coconut farmers’ organizations shall be validated

and shortlisted by the PCA.

The list of nominees shall be submitted to the President not later than sixty (60) days
from the start of the selection process. The government representatives in the
Committee shall serve only during their respective terms in office, while the six (6)
representatives from coconut farmers’ organizations shall each hold a term of one (1)

year, unless sooner removed for cause, Any of the representatives shall continue to hold


office until their successor is appointed: Provided, That any appointment to fill a
vacancy in the Committee shall be only for the unexpired term.

SEC. 13. Ex Officio Alternates. ~ The ex officio members of the Committee may designate
their respective alternates who shall be the officials next-in-rank to them and their acts

shall be considered the acts of their principals.

SEC. 14, Meetings of the Committee. - The Committee shall meet at least once a month,
or as often as deemed necessary and expedient to discharge its responsibilities. The
presence of at least a majority of the members of the Committee shall constitute a
quorum, and the concurrence of a majority of the members present at a meeting at
which a quorum exists shall be adequate for any decision by the Committee: Provided,
That the approval of at least a majority of the members of the Committee shall be

required on matters involving the following:

(a) Any disbursement of funds involving more than fifty million pesos (P50,000,000.00);
(b) Any proposed investment involving more than one hundred million pesos
(P100,000,000.00); and

(c) Any disposition or privatization proposal involving more than five hundred million

pesos (P500,000,000.00)

The Chairperson, if unavailable, may designate the Vice Chairperson to convene the
Committee and preside over the Committee's meeting on behalf of the Chairperson.

s of the Members of the Committee. - The members of the Committee

SEC. 15. Obtig
shall act with due care, diligence, skill, and good faith in all its dealings with the Trust
Fund and the Coconut Levy Assets. They shall avoid conflicts of interest and declare

before the Committee any interest they may have in any particular matter. Where a
menuber of the Contnittee receives any profit or benefit by virtue of the office, including
acquiring shares in corporations that form part of the Coconut Levy Assets, using the
Coconut Levy Assets for one’s benefit, receiving commission on contracts from the
Coconut Levy Assets, or taking advantage of corporate opportunities involving the
Coconut Levy Assets, all such profits or benefits shall be returned to the Trust Fund

without prejudice to any administrative, civil or crirainal action against such member.


This provision shall be applicable notwithstanding the fact that such member of the

Committee used one’s own funds in the venture.

SEC. 16. Executive Director of the Committee. - The President, upon recommendation of
the Committee, shall appoint an Executive Director who shall exercise the following
powers and functions:

(a) Administer the programs approved or promulgated by the Committee;

(b) Direct and supervise officials, employees, representatives and agents for the
Committee;

(c) Prepare an annual report on the activities of the Committee at the close of each fiscal
year and to submit a copy thereof to the President and Congress;

(@) Keep and maintain official records and reports of the proceedings of the Committee;
(e) Administer oaths in all matters falling within the jurisdiction of the Committee; and
(0 Exercise such other duties as may be vested by the Committee that are consistent
with the provisions of this Act. The PCA shall provide Secretariat support to the
Committee.

SEC. 17. Cooperation with the Committee. - The Committee may also call upon any
department, bureau, office, agency, and instrumentality of the government, including
government-owned and -controlled corporations for any assistance it may need in the
discharge of its functions and responsibilities.

SEC. 18. Accounting and Auditing, ~ The Committee shall maintain records and accounts
of all investments, income, receipts, disbursements and other transactions relating to
the management, administration and disposition of the Trust Fund. These records and
accounts shall be maintained in accordance with existing accounting and auditing laws,

rules and regulations, The Trust Fund shall be audited by the COA.

SEC. 19. Legal Counsel. - The Secretary of Justice shall be the ex officio counsel of the

Committee on legal matters.


CHAPTER V
COCONUT FARMERS AND INDUSTRY DEVELOPMENT PLAN

SEC, 20. Preparation of the Coconut Farmers and Industry Development Plan. ~ An Ad
Hoc Committee is hereby created to be composed of the Secretaries of the DA, the
Department of Agrarian Reform (DAR), the DTI, the Department of Science and
Technology (DOST), the 14 Department of Energy (DOE), the Department of Public
Works and Highways (DPWH), the DepEd, the NEDA, and a representative from the
farmers’ groups.

The Administrator of the PCA shall act as the Ad Hoc Committee's Chairperson. The Ad-
Hoc Committee, in consultation with the coconut farmers and representatives of the
coconut industry, shall indicate in an integrated coconut industry strategy map the
policies for the development and rehabilitation of the coconut industry and shall
prepare, every five (5) years, 2 medium term plan of programs, activities and projects
which shal! be funded out of the Trust Fund and which shall be known as the Coconut

Farmers and Industry Development Plan.

The Plan shall be consistent with the Philippine Development Plan and shall be subject
to mandatory review every year. In the formulation of the Plan, the Ad-Hoc Committee
shall be guided by the following objectives:

(a) ‘The increase in the income of coconut farmers and increase coconut productivity
including intercropping and livestock-raising;

(b) The promotion of coconut-based enterprises including integrated processing of
coconut products and downstream products;

(0) ‘the provision of timely and critical support to coconut farmers organization and
development; and

(d) ‘The establishment of social protection programs that directly benefit coconut
farmers and farm workers, in case these social protection programs are not funded by

an appropriations law or any other special law, or where funding is insufficient.

The

an shall provide an indicative funding requirement or allocation for the

implersentation of any and ali of the programs and projects to be funded by the Trust


Income, which funding or allocation shall be itemized or broken down on a project-to-

project basis:

Provided, ‘That (a) for projects 15 which are recurring, or to be implemented on a
regular basis, the allocation shall indicate the annual fund that may be required to
implement the project; and (b) for projects that are to be implemented or concluded
within a period of time, the allocation shalll indicate the total fund that may be required
for the implementation of the whole project, itemized according to the phases or stages

of the project.

Within sixty (60) days from the effectivity of this Act, the Plan shall be submitted by the
Ad Hoc Committee to the Coconut Farmers and Industry Trust Fund Committee which

shail, in turn, submmic the Plan to the President for approval. Immediately upon its
approval, he Plan shall be returned to the Committee for the disbursement of funds in

accordance with the provisions of this Act. Any amendment to the Plan shall require the

approval of the President. If the President has any objection or any amendment thereto,

the Pre:

st shali notify the Committee within thirty (30) days from receipt thereof,

otherwise the Plan shall be deemed approved.

CHAPTER VI
PRIVATIZATION OF THE COCONUT LEVY ASSETS

SEC. 21. Privatization of the Coconut Levy Assets. - The Committee shall determine the
Coconut Levy Assets that shall be privatized. For this purpose, the Committee shall be
guided by the following factors:

(a) The functions or purposes for which the entity was created are no longer relevant to

the State or no longer consistent with the national development policy of the Stat

(b) The functions or purposes of the entity duplicate or unnecessarily overlap with the
functions, programs, activities or projects already provided by another agency;
(c) ‘The entity is noc producing the desired outcomes, or is no longer achieving the

objectives for which it was originally designed and implemented;


(a) The entity is dormant or nonoperational;

e) The entity is involved in an activity which is best carried out by the private sector;
and

(8) The function, purpose, or nature of operations of any group of entities requires

consolidation under a holding company.

The Committee shall submit its recommendation to the President for approval. The
Committee shall also arrange for the transfer of the Coconut Levy Assets approved for
privatization to the PMO, unless the President, upon the recommendation of the
Committee, designates another agency to preserve such Coconut Levy Assets pending

privatization.

SEC. 22, Additional Mandate of the Privatization and Management Office (PMO). ~ In
addition to its powers and functions under Executive Order No, 323 dated December 6,
2000, the PMO is authorized to dispose the Coconut Levy Assets that have been
approved for privatization,

In the discharge of its mandate, the PMO shall:

(a) Formuiate and implement the marketing and disposition program after securing
prior approval of the Committee;

(b) Take possession of and preserve such assets on behalf of the National Government;
(c) Execute and deliver, on behaif of the National Government, deeds of sale, contracts,
trust instruments, and other legally operative documents as may be necessary or

appropriate to convey title to, take possession of, and conserve such

ts;

(d) Engage external expertise as may be necessary in the fulfillment of its tasks under
this Act; and.

(e) Adopt internal rules and regulations.

Any and all sales and other modes of privatization or disposition shall not be considered

final untess and until approved by the Committee.


SEC. 23. Powers of the Privatization and Management Office (PMO). - The PMO is also
empowered to enter into sales through public bidding, negotiated sale, lease, or any
form of divestment or transmission of rights over the Coconut Levy Assets: Provided,
That no Coconut Levy Asset shall revert to the previous owners or their nominees or be
sold to individuals who, as determined by final judgment of a court of law, have
mismanaged or diverted such assets.

Prior to the implementation of any privatization plan, the PMO shall exercise the
following powers:

(a) Require anyone or the subject corporations to adopt and implement cost-reduction
measures to enbance the viability, and therefore the disposability of the corporations to
potential buyers, including measures requiring personnel retrenchment plans or other
forms of corporate downsizing;

(b) Direct anyone or all of the subject corporations to submit to the PMO, within fixed
timetables, such reports and information as the PMO may require in the exercise of its
functions under this Act; and

(c) Cause the subject corporations to undergo merger, consolidation, spin-off, or other
corporate acts of reformatory nature as it may deem necessary or desirable to expedite
the disposition and privatization under this Act. In all such cases, no corporate measure
shaij be implerented without the approval of tae Committee, Nothing herein shall be
construed as authorizing the Committee or the PMO to rehabilitate or allow investments
of any and ali Coconut Levy Assets transferred to the National Government. 18 SEC. 24.
Committee to Determine Transfer Value. - The Committee is hereby vested with full and
complete powers aud prerogatives to determine transfer values and related valuations
at which te Coconut levy Assets shall be transferred and conveyed to the PMO
pursuant (o the mandate of this Act and upon reasonable consultation with a third-party
appraiser: Provided, That any valuation approved by the Committee for purposes of the -
transfer to the PMO shail not be deemed a condonation, waiver, or extinguishment of
any obligation by any party whose vested rights may be impaired by such transfer. SEC.
25. Remittance of Proceeds of Privatization. - All proceeds or receipts from the sale of

Coconut Levy Assets shall be remitted to the Trust Fund.

SEC. 26, Reporting R snznittee shall, on a semiannual basis, submit

to the President and to Congress a report on the status of disposition of the Coconut


Levy Assets, which shall include, among others, a description of the individual assets
disposed of, the purchasers thereof, the consideration received therefor, and the agreed
terms of payment. The PMO shall, within three (3) months following the closure of
books at the end of each fiscal year, submit a comprehensive annual report duly
approved or endorsed by the Committee, to the President and Congress on the status of
its privatization efforts and its disposition program for the Coconut Levy Assets, which
shall include the items described in the immediately preceding paragraph.

SEC. 27, Retention and Dissolution of Coconut Levy Assets. ~ The Committee shall
identify the Coconut Levy Assets that should be retained by the National Government or
reorganized or abolished, guided by the same standards mentioned in Section 21 of this
Act. The Gommittee shali submit its recommendation to the President for approval. 19
Coconut Levy Assets that have been approved for retention shall be transferred to such
agency as may be designated by the President. The Governance Commission on
Government-Owned or -Controlled Corporations (GCG), created under Republic Act No.
10149, shali implement the dissolution of those Coconut Levy Assets that have been

approved for abolition. SEC. 28, Allowable Investments.
he?

circumstances tha

The Committee shall manage

‘ust Principal with the skill, care, prudence, and diligence necessary under the

srudent person acting in like capacity and familiar with such

matters would exercise in the conduct of an enterprise of a like character and with

similar aims. Pursuant thereco, and in line with the basic principles of safety, growth,

and liquidity, the

Trust Principal shalt only be invested in any or all of the following:
(a) Bonds,

Government of th:

promissory votes or other evidence of indebtedness of the

ilippines, or in bonds, securities, promissory notes and other

evidence of indebtedness to which full faith, credit and unconditional guarantee of the

Republic of the Philippines is pledged;

(b) Bonds, securities, promissory notes or other evidence of indebtedness of
government fnancial institutions or government corporations with acceptable credit or
guarantee: Provided, That such investraents shall be subject to a ceiling to be fixed by

the Commnittee in che implementing ruies and regulations; and


(©) Deposits and loans and/or investments in any domestic bank doing business in the
Philippines and in good standing with the Bangko Sentral ng Pilipinas: Provided, That in
case of such deposits, these shall not exceed at any time the unimpaired capital and
surplus or total private deposits of the depository bank, whichever is smaller; Provided,
further, That the bank shall have been first designated as a depository for this purpose
by the Monetary 20 Board of the Bangko Sentral ng Pilipinas: Provided, finally, That
such investments shalll be subject to a ceiling to be fixed by the Committee in the

implementing rules and regulations.

CHAPTER VII FINAL PROVISIONS

SEC. 29. Suppletory on Applicability of Republic Act No. 10149 and Executive Order No.
323. - In the interpretation of the provisions of this Act, the provisions of Republic Act
No. 10149, otherwise known as the “GOCC Governance Act of 2011”, and Executive
Order No. 323, entitled, “Constituting an Inter-Agency Privatization Council (PC) and
Creating a Privatization and Management Office (PMO) under the Department of
Finance for the Continuing Privatization of Government Assets and Corporations”,
except for Sections 2 and 3 of Article IV of Executive Order No. 323, shall apply
suppletorily.

SEC. 30. Implementing Rules and Regulations. - Within thirty (30) days from the date of
the effectivity of this Act, the Committee, in consultation with the PMO, shall formulate
and promulgate the rules and regulations for the proper implementation of this Act.

SEC. 31, Congressional Oversight. ~ The Congressional Oversight Committee on
Agricultural and Fisheries Modernization (COCAFM) shall exercise oversight functions
over the implementation of this Act. The financial review of the program in relation to
its performance indicators shal! be subject to the oversight functions of the Joint

Congressional Oversight Committee on Public Expenditures.


SEC, 32. Separability Clause. - If, for any reason or reasons, any part or provision of this
Act shall be held unconstitutional or invalid, other parts or provisions hereof which are

not affected thereby shail continue to be in full force and effect.

SEC. 33. Repealing Clause. ~ All laws, decrees, executive orders, rules and regulations,
and all other issuances inconsistent with this Act shall be deemed repealed, modified or

amended accordingl

SEC. 34, Effectivity Clause. - This Act shall take effect fifteen (15) days after the

completion of its publication in at least two (2) newspapers of general circulation.

Approved,