1 
Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City, Metro Manila 
TWENTIETH CONGRESS 
First Regular Session 
HOUSE BILL NO. ______ 
Introduced by Representatives Bryan B. Revilla, Lani Mercado-Revilla, and Ramon 
Jolo B. Revilla III 
EXPLANATORY NOTE 
Almost all, 99.51% to be precise, of all business enterprises operating in the country 
are classified MSMEs according to the 2020 List of Establishment of the Philippine 
Statistics Authority (PSA). MSMEs employ 63.19% of the country's workforce. 
This bill seeks to encourage and enhance the development of MSMEs in the country 
by providing the following provisions: 
1. Automatic approval of their business application;
2. National Government to allocate of at least 10% of all its procurement
opportunities for goods and services to eligible MSMEs;
3. Providing 20% discount on shipping and delivery fees to duly registered
MSMEs;
4. Reservation of free storage space to duly registered MSMEs, 1% of total
available space in government offices and structures and 5% in private malls,
supermarkets, shopping centers, among others, measuring at least 5,000 sqm.
5. Allocating at least 20% of private mall's totable rentable space and 20%
discount on their rental rates.
 By providing these relief measures to qualified MSMEs, the government is also 
ensuring their growth and continued employment of millions of Filipinos. 
 In view of the foregoing reasons, the approval of this bill is earnestly sought. 
     REP. BRYAN B. REVILLA 
        REP. LANI MERCADO-REVILLA 
Representative, AGIMAT Party-list 
  Representative, 2nd District of Cavite  
REP. RAMON JOLO B. REVILLA III 
Representative, 1st District of Cavite 
September 8, 2025
9:17 am
4384


1 
Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City, Metro Manila 
TWENTIETH CONGRESS 
First Regular Session 
HOUSE BILL NO. ______ 
Introduced by Representatives Bryan B. Revilla, Lani Mercado-Revilla, and Ramon 
Jolo B. Revilla III 
AN ACT  
FURTHER PROMOTING ENTREPRENEURSHIP BY STRENGTHENING, 
EMPOWERING, AND ENHANCING THE FINANCING AND OTHER SUPPORT 
PROGRAMS FOR MICRO, SMALL AND MEDIUM ENTERPRISES, AMENDING 
FOR THE PURPOSE REPUBLIC ACT NO. 6977, AS AMENDED, OTHERWISE 
KNOWN AS THE "MAGNA CARTA FOR MICRO, SMALL AND MEDIUM 
ENTERPRISES (MSMEs)” 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
SECTION 1. Section 2 of Republic Act No. 6977, as amended, is hereby further 
1 
amended to read as follows:  
2 
"SEC. 2. Declaration of Policy. - Recognizing that MSMEs have the 
3 
potential [for] TO GENERATE more employment [generation] and 
4 
SPUR economic growth and therefore can help provide a self-sufficient 
5 
industrial foundation for the country, it is hereby declared the policy of 
6 
the State to promote, support, strengthen and encourage the growth and 
7 
development of MSMEs in all productive sectors of the economy 
8 
particularly rural/agri-based, MANUFACTURING, FINANCE AND 
9 
SERVICES enterprises. To this end, 
10 
the State shall recognize the specific needs of the MSMEs and shall 
11 
undertake to promote entrepreneurship, support entrepreneurs, 
12 
encourage the establishment of MSMEs and ensure their continuing 
13 
viability and growth and thereby attain countryside industrialization by: 
14 
"xxx." 
15 
16 
SECTION 2. Section 4 of the same Act, as amended, is hereby further amended to 
17 
read as follows:  
18 
4384


2 
"SEC. 4. Eligibility for Government Assistance. - To qualify for 
1 
assistance, counseling, incentives and promotion under this Act, 
2 
businesses falling under the above definition must be: 
3 
“a) duly registered with the appropriate agencies as presently provided 
4 
by law: Provided, That in the case of micro enterprises as defined herein, 
5 
registration with the office of the municipal or city treasurer shall be 
6 
deemed sufficient compliance with this requirement; 
7 
 "THE APPLICATION OF AN MSME FOR ANY PERMIT AND LICENSE 
8 
FROM 
ANY 
LOCAL 
GOVERNMENT 
UNIT, 
INCLUDING 
A 
9 
BARANGAY, 
SHALL 
BE 
AUTOMATICALLY 
APPROVED 
10 
PROVISIONALLY, SUBJECT TO THE FINAL APPROVAL OF THE 
11 
APPLICATION AND THE ISSUANCE OF THE PERMIT OR LICENSE 
12 
APPLIED FOR. 
13 
"THE TOTAL COST FOR THE ISSUANCE OF ALL PERMITS, 
14 
LICENSES, CERTIFICATIONS, AND OTHER SIMILAR REQUIRED 
15 
DOCUMENTATION FOR THE CONDUCT OF BUSINESS FOR 
16 
REGISTERED MICRO ENTERPRISES SHALL NOT EXCEED FIVE 
17 
HUNDRED 
PESOS 
(P500.00). 
FOR 
REGISTERED 
SMALL 
18 
ENTERPRISES, THE TOTAL COST SHALL NOT EXCEED FIVE 
19 
THOUSAND PESOS (P5,000.00) FOR A PERIOD OF FIVE (5) YEARS. 
20 
"b) one hundred percent (100%) owned, capitalized by Filipino citizens, 
21 
whether single proprietorship or partnership. If the enterprise is a juridical 
22 
entity, at least sixty percent (60%) of its capital or outstanding stocks 
23 
must be owned by Filipino citizens: "x x x. 
24 
"[Eligible MSMEs shall be entitled to a share of at least ten percent (10%) 
25 
of total procurement value of goods and services supplied to the 
26 
Government, its bureaus, offices and agencies annually.] THE 
27 
NATIONAL 
GOVERNMENT, 
ITS 
BUREAUS, 
OFFICES 
AND 
28 
AGENCIES SHALL ALLOCATE AT LEAST TEN PERCENT (10%) OF 
29 
ALL ITS PROCUREMENT OPPORTUNITIES FOR GOODS AND 
30 
SERVICES TO ELIGIBLE MSMES IN ACCORDANCE WITH THE 
31 
PROVISIONS OF REPUBLIC ACT NO. 9184, OTHERWISE KNOWN 
32 
AS THE 'GOVERNMENT PROCUREMENT REFORM ACT, AND ITS 
33 
IMPLEMENTING RULES AND REGULATIONS. 
34 
"The [Department of Budget and Management] GOVERNMENT 
35 
PROCUREMENT POLICY BOARD (GPPB) shall FORMULATE 
36 
RULES FOR THE EFFECTIVE IMPLEMENTATION OF THIS 
37 
PROVISION AND monitor the compliance of government agencies on 
38 
the required procurement for MSMEs and submit its report to the 
39 
MSMED Council on a semestral basis and to the Congress of the 
40 
Philippines, through its appropriate committees on a yearly basis. 
41 
 "DULY REGISTERED MICRO AND SMALL ENTERPRISES SHALL 
42 
BE ENTITLED TO A DISCOUNT OF AT LEAST TWENTY PERCENT 
43 
(20%) ON SHIPPING AND DELIVERY FEES FOR THEIR PRODUCTS 
44 


3 
AND RAW MATERIALS, AS WELL AS FOR MAILING, FREIGHT AND 
1 
OTHER SIMILAR SERVICES PROVIDED BY EITHER PUBLIC OR 
2 
PRIVATE COURIERS. 
3 
  
4 
 
5 
"GOVERNMENT BUILDINGS, STRUCTURES AND OPEN AREAS, 
6 
INCLUDING PUBLIC MARKETS, WHETHER WET OR DRY, 
7 
AIRPORTS, 
SEA 
PORTS, 
FISH 
PORTS, 
PARKS, 
ZOOS, 
8 
CONVENTION CENTERS, ENTERTAINMENT CENTERS, TOURISM 
9 
CENTERS, SCHOOLS, SCHOOL CAMPUSES, AND OTHER SIMILAR 
10 
STRUCTURES 
OR 
AREAS 
SUITABLE 
FOR 
SELLING 
OR 
11 
MARKETING, WHETHER PERMANENT OR TEMPORARY, THAT 
12 
CAN BE USED AS SELLING AREAS, SHALL GIVE AN AUTHORIZED 
13 
MSME STORE FREE SPACE MEASURING AT LEAST ONE 
14 
PERCENT (1%) OF THE TOTAL SPACE AVAILABLE THEREIN 
15 
  
16 
"PRIVATE MALLS, SUPERMARKETS, SHOPPING CENTERS, 
17 
COMMERCIAL SELLING ESTABLISHMENTS, STRUCTURES, OR 
18 
AREAS WITH A SELLING AREA, WHETHER PERMANENT OR 
19 
TEMPORARY, MEASURING AT LEAST FIVE THOUSAND SQUARE 
20 
METERS (5,000 SQM), INCLUDING COMMON ARFAS, BUT 
21 
EXCLUDING PARKING SPACES AND DRIVEWAYS, SHALI. GIVF 
22 
FREE SPACE OR AREA EQUIVALENT TO ONE HALF OF ONE 
23 
PERCENT (0.5%) OF THE SAID SELLING AREA FOR EVERY FIVE 
24 
THOUSAND SQUARE METERS (5,000 SQM) OF SELLING AND 
25 
COMMON SPACE, TO ANY AUTHORIZED MSME STORE. AS USED 
26 
IN THIS ACT, "FREE SPACE" SHALL MEAN SPACE THAT MAY BE 
27 
USED FOR SELLING PURPOSES WITHOUT NEED FOR THE 
28 
PAYMENT 
OF 
RENT, 
GOODWILL 
FEES, 
ROYALTIES, 
29 
COMMISSION, PERCENTAGES ON SALES, NOR ANY OTHER 
30 
SIMILAR SCHEME. 
31 
"THE 
MSMED 
COUNCIL 
OF 
THE 
CONCERNED 
CITY, 
32 
MUNICIPALITY OR BARANGAY SHALL APPROVE THE MSME 
33 
STORE THAT WILL BE GIVEN FREE SPACE, UPON THE 
34 
RECOMMENDATION 
OF 
THE 
LOCAL 
OFFICE 
OF 
THE 
35 
DEPARTMENT OF TRADE AND INDUSTRY. THE FREE SPACE 
36 
ALLOCATED FOR THE MSME STORE SHALL BE GIVEN IN THE 
37 
FOLLOWING ORDER OF PREFERENCE: 
38 
1. ONE TOWN ONE PRODUCT (OTOP) STORE OR GO LOKAL! 
39 
STORE OF THE DEPARTMENT OF TRADE AND INDUSTRY; 
40 
2. MSME KUMUNIDARAN PRODUKTO AT RESONABLENG 
41 
SERBISYO  STORE (OR "KUMPARE STORE"); OR 
42 
3. A LOCAL MICRO OR SMALL ENTERPRISE STORE. 
43 


4 
  
1 
"ONCE AN MSME STORE IS IN PLACE, REMOVAL OR 
2 
REPLACEMENT SHALL NOT BE ALLOWED EXCEPT FOR VALID 
3 
CAUSE AND AFTER DUE PROCESS. 
4 
"THE APPROVAL AND THE REMOVAL OF THE MSME STORE THAT 
5 
WILL BE GIVEN FREE SPACE SHALL BE REPORTED BY THE 
6 
MSMED COUNCIL OF THE CONCERNED CITY, MUNICIPALITY OR 
7 
BARANGAY TO THE CONGRESSIONAL OVERSIGHT COMMITTEE 
8 
ON MICRO, SMALL AND MEDIUM ENTERPRISE DEVELOPMENT.  
9 
"PRIVATE MALLS SHALL ALSO ALLOCATE TWENTY PERCENT 
10 
(20%) OF THEIR TOTAL RENTABLE SPACE TO LOCAL MICRO AND 
11 
SMALL ENTERPRISES WHICH SHALL BE EXTENDED A TWENTY 
12 
PERCENT (20%) 
13 
DISCOUNT ON RENTAL RATES. PRIVATE MALLS SHALL NOT 
14 
CHARGE 
ROYALTY 
CHARGES, 
GOODWILL 
CHARGES, 
15 
COMMISSION CHARGES, PERCENTAGE OF SALES, AND OTHER 
16 
SIMILAR SCHEMES UPON THE MSMEs.” 
17 
 
18 
SECTION 3. Section 5 of the same Act, as amended, is hereby further amended to 
19 
read as follows: 
20 
"SEC. 5. Guiding Principles. - To set the pace for MSME development, 
21 
the State shall be guided by the following principles:  
22 
"a) Minimal set of rules and simplification of procedures and 
23 
requirements. All government agencies having to do with MICRO AND 
24 
small enterprises shall pursue the principles of minimum regulation to 
25 
ensure stability of rules and to encourage entrepreneurial spirit among 
26 
the citizenry. The agencies shall see to it that procedural rules and 
27 
requirements, within their respective offices in coordination with other 
28 
agencies, are minimized in the act of registration, availment of financing 
29 
and accessing other government services and assistance.  
30 
"b) Role of the private sector. In order to hasten growth and expansion 
31 
of MICRO, small and medium enterprises, the private sector throughout 
32 
the country shall be encouraged to assist in the effective implementation 
33 
of this Act by participating in government programs for MICRO, small 
34 
and medium enterprises strictly in accordance with the law, and 
35 
consistent with the attainment of the purposes hereof. To encourage 
36 
private sector participation, the Council, in consultation with the 
37 
concerned sector, may recommend simplified procedure and localized 
38 
incentives to MICRO AND small enterprises. The Government shall 
39 
encourage the organization and establishment of MICRO, small and 
40 
medium enterprise industry associations at the local and regional levels 
41 
preferably unified under a national federation/association. 
42 


5 
“c) Coordination of government efforts. Government efforts shall be 
1 
coordinated to achieve coherence in objectives. All appropriate offices, 
2 
particularly those under the Departments of Trade and Industry, Finance, 
3 
Budget and Management, Agriculture, Agrarian Reform, Environment 
4 
and Natural Resources, Labor and Employment, 
5 
Transportation 
[and 
Communications], 
INFORMATION 
AND 
6 
COMMUNICATIONS TECHNOLOGY, Public Works and Highways, 
7 
Science and Technology, Interior and Local Government, and Tourism 
8 
as well as the National Economic and Development Authority, Philippine 
9 
Information Agency, SECURITIES AND EXCHANGE COMMISSION 
10 
and the Bangko Sentral ng Pilipinas, through their national, regional and 
11 
provincial offices shall, to the best of their efforts and in coordination with 
12 
local government units, provide the necessary support and assistance to 
13 
MSMEs. THE DEPARTMENT OF TRADE AND INDUSTRY SHALL BE 
14 
THE LEAD AGENCY THEREFOR.  
15 
"xxx." 
16 
SECTION 4. Section 6 of the same Act, as amended, is hereby further amended to 
17 
read as follows: 
18 
"SEC. 6. Micro, Small and Medium Enterprises Development Plan 
19 
(MSMEDP). - The President OF THE PHILIPPINES shall approve a six-
20 
year micro, small and medium enterprises development plan prepared 
21 
by the Department of Trade and Industry (DTI) which shall form part of 
22 
the [Medium Term] Philippine Development Plan ([MT]PDP). It shall be 
23 
formulated in consultation with the private sector, validated and updated 
24 
semestrally. Such plan shall include a component on a micro credit 
25 
financing scheme." 
26 
 
27 
SECTION 5.Certification. - Section 7 of the same Act, as amended, is hereby further 
28 
amended to read as follows: 
29 
"SEC. 7. Micro, Small and Medium Enterprise Development (MSMED) Council. 
30 
- The existing Small and Medium Enterprise Development Council, which was 
31 
created by Republic Act No. 6977, as amended [by Republic Act No. 8289], 
32 
shall be strengthened to effectively spur the growth and development of 
33 
MSMEs throughout the country, and to carry out the policy declared in this Act 
34 
and shall now be known as the Micro, Small and Medium Enterprise 
35 
Development (MSMED) Council. The Council shall be attached to the 
36 
Department of Trade and Industry and shall be constituted within sixty (60) 
37 
days after the approval of this Act.  
38 
"The Council shall be the primary agency responsible for the promotion, growth 
39 
and development of MICRO, small and medium enterprises in the country by 
40 
way of facilitating and closely coordinating national efforts to promote the 
41 
viability and growth of MICRO, small and medium enterprises, including 
42 
assisting relevant agencies in the tapping of local and foreign funds for MICRO, 
43 
small and medium enterprise development, as well as promoting the use of 
44 


6 
existing programs, as well as seeking ways to maximize the use of our labor 
1 
resources." 
2 
SECTION 6. Section 7-A of the same Act, as amended, is hereby further amended to 
3 
read as follows: 
4 
"SEC. 7-A. Composition of the Micro, Small and Medium Enterprises 
5 
Development (MSMED) Council. - The members of the Council shall be 
6 
the following:  
7 
"(a) The Secretary of Trade and Industry as Chair;  
8 
"(b) The Secretary of Agriculture; 
9 
"(c) The Secretary of the Interior and Local Government; 
10 
"(D) THE SECRETARY OF FINANCE;  
11 
"[(d)] (E) Three (3) representatives from the MSME sector, [to represent 
12 
Luzon, Visayas and Mindanao, with at least one (1) representative from 
13 
the microenterprise sector] TO BE DESIGNATED BY A NATIONAL 
14 
ORGANIZATION REPRESENTING AND DOMINATED BY MSMES; 
15 
AND 
16 
"[(e) One (1) representative from the women sector designated by the 
17 
Philippine Commission on Women;] 
18 
"[(f) One (1) representative from the youth sector designated by the 
19 
National Youth Commission; and] 
20 
"[(g)] (F) The[Chairman]PRESIDENT of THE Small Business 
21 
Corporation.  
22 
"A. Advisory Unit. -There shall be an Advisory Unit to the Council, which 
23 
shall consist of the following: 
24 
 "(a) The Secretary of Science and Technology; 
25 
"(b) The Governor of the Bangko Sentral ng Pilipinas; 
26 
"(C) THE COMMISSIONER OF THE SECURITIES AND 
27 
EXCHANGE      COMMISSION; 
28 
"[(c)] (D) The President of the Land Bank of the Philippines; 
29 
"[(d)] (E) The President of the Development Bank of the 
30 
Philippines;  
31 
“[(e)] (F) The Director General of the National Economic and 
32 
Development Authority;  
33 
"(G) THE EXECUTIVE DIRECTOR OF THE COOPERATIVE 
34 
DEVELOPMENT AUTHORITY; 
35 


7 
“(H) A REPRESENTATIVE OF A NATIONAL ORGANIZATION 
1 
REPRESENTING AND DOMINATED BY MSMEs; 
2 
"[(f)] (I) One (1) representative from the labor sector, to be 
3 
nominated by accredited labor groups; 
4 
"[(g)] (J) A representative from the private banking sector to serve 
5 
[alternatively] ALTERNATELY between the [c] Chamber of [t] Thrift [b] 
6 
Banks, and the Rural Banker's Association of the Philippines (RBAP); 
7 
"[(h)] (K) A representative of the microfinance nongovernment 
8 
Organizations (NGOS), DESIGNATED BY THE MICROFINANCE NGO 
9 
REGULATORY COUNCIL;  
10 
"[(i)] (L) A representative of the University of the Philippines-
11 
Institute for Small Scale Industries (UP-ISST); [and]  
12 
"[(j)] (M) The President of the Credit Information Corporation[.]:  
13 
"(N) ONE (1) REPRESENTATIVE FROM THE WOMEN 
14 
SECTOR DESIGNATED BY THE PHILIPPINE COMMISSION ON 
15 
WOMEN; 
16 
"(O) ONE (1) REPRESENTATIVE FROM THE YOUTH SECTOR 
17 
DESIGNATED BY THE NATIONAL YOUTH COMMISSION; AND 
18 
“(P) A REPRESENTATIVE FROM NONSTOCK SAVINGS AND 
19 
LOAN ASSOCIATIONS DESIGNATED BY THE ALLIANCE OF NON-
20 
STOCK 3 SAVINGS AND LOAN INSTITUTIONS, INC. (ANSLI). 
21 
"xxx.” 
22 
SECTION 7. Section 7-B of the same Act, as amended, is hereby further amended to 
23 
read 6 as follows: "SEC. 7-B. Powers and Functions. - A. The MSMED Council shall 
24 
have & the following powers, duties and functions: 
25 
"Xxx; 
26 
"d) To review the existing policies of government agencies that 
27 
would affect the growth and development of MSMEs and recommend 
28 
changes to the President and Congress through the Committee on 
29 
Economic Affairs of the Senate and the Committee on [Small Business 
30 
and Entrepreneurship] MICRO, SMALL AND MEDIUM ENTERPRISE 
31 
Development of the House of Representatives, whenever deemed 
32 
necessary. This shall include efforts to 16 simplify rules and regulations, 
33 
as well as review of the applicability and relevance of procedural and 
34 
documentary requirements in the registration, financing, and other 
35 
activities relevant to MSMEs the result shall be included in the annual 
36 
report to be submitted to Congress;  
37 
"xxx;  
38 


8 
"h) To promote the productivity and viability of MSMEs IN DTI'S TOP 
1 
PRIORITY INDUSTRIES FOR DEVELOPMENT by way of directing 
2 
[and/Jor 23 assisting relevant government agencies and institutions at 
3 
the national, 24 regional and provincial levels towards the:  
4 
"xxx;  
5 
"12) Through appropriate government agencies:  
6 
"xxx;  
7 
"f) Set-up new MSME NEGOSYO centers and revitalize already 29 
8 
established MSME NEGOSYO centers to provide MSMEs in the 30 
9 
regions easier access to services such as the following:  
10 
"xxx."  
11 
"B. ADDITIONAL FUNCTIONS OF THE MSMED COUNCIL. - AS 33 
12 
PROVIDED FOR IN SECTION 10 OF REPUBLIC ACT NO. 10644, 34 
13 
OTHERWISE KNOWN AS THE "GO NEGOSYO ACT", THE MSMED 
14 
35 COUNCIL SHALL HAVE THE FOLLOWING ADDITIONAL 
15 
FUNCTIONS: "(A) COORDINATING AND OVERSIGHT BODY FOR 
16 
THE MSME NEGOSYO CENTER. - THE MSMED COUNCIL, 
17 
THROUGH THE DTI, SHALL ACT AS THE COORDINATING AND 
18 
SUPERVISING BODY FOR ALL THE AGENCIES INVOLVED IN THE 
19 
ESTABLISHMENT AND OPERATION OF THE MSME NEGOSYO 
20 
CENTERS. FURTHER, THE MSMED COUNCIL SHALL MONITOR 
21 
AND ASSESS THE PROGRESS OF THE MSME NEGOSYO 
22 
CENTERS, WHICH SHALL BE INCLUDED IN ITS ANNUAL REPORT 
23 
SUBMITTED TO THE CONGRESS; 
24 
  
25 
"(B) PROVISION OF A COMPLIANCE GUIDE. - FOR EACH RULE OR 
26 
GROUP OF RELATED RULES ISSUED BY ANY GOVERNMENT 
27 
AGENCY FOR COMPLIANCE BY MSMES, THE COUNCIL SHALL 
28 
PUBLISH COMPLIANCE GUIDELINES WHICH SHALL BE WRITTEN 
29 
IN PLAIN LANGUAGE OR IN THE LOCAL DIALECT, IF NECESSARY. 
30 
"THE COUNCIL SHALL PREPARE SEPARATE COMPLIANCE 
31 
GUIDES COVERING GROUPS OR CLASSES OF SIMILARLY 
32 
AFFECTED MSMES AND SHALL COOPERATE WITH INDUSTRY 
33 
ASSOCIATIONS 
TO 
DEVELOP 
AND 
DISTRIBUTE 
SUCH 
34 
COMPLIANCE 
GUIDES. 
THE 
PUBLICATION 
OF 
EACH 
35 
COMPLIANCE GUIDE SHALL INCLUDE THE POSTING OF THE 
36 
GUIDE IN A CONSPICUOUS LOCATION ON THE WEBSITE OF THE 
37 
AGENCY, AND DISTRIBUTION OF THE GUIDE TO KNOWN 
38 
INDUSTRY 
CONTACTS, 
SUCH 
AS 
SMALL 
ENTITIES, 
39 
ASSOCIATIONS OR INDUSTRY LEADERS AFFECTED BY THE 
40 
RULE. THE ISSUING GOVERNMENT AGENCY SHALL PUBLISH 
41 
AND DISSEMINATE THE COMPLIANCE RULES WITHIN NINETY (90) 
42 
DAYS FROM THE DATE OF ISSUANCE;  
43 


9 
“(C) CONDUCT OF RESEARCH ON WOMEN ENTREPRENEURSHIP. 
1 
- THE COUNCIL SHALL CONDUCT RESEARCH TO SUPPORT 
2 
WOMEN ENTREPRENEURSHIP INCLUDING ENTREPRENEURIAL 
3 
BEHAVIOR, BARRIERS, PARTICIPATION AND CESSATION RATES 
4 
DISCRIMINATORY PRACTICES AND CONTRIBUTION TO THE 
5 
NATIONAL ECONOMY AND GROWTH; 
6 
"(D) POLICY FORMULATION ON WOMEN ENTREPRENEURSHIP. - 
7 
THE COUNCIL SHALL PROVIDE POLICY DIRECTION TOWARDS 
8 
RECOGNIZING 
WOMEN'S 
PROPENSITY 
AND 
TALENT 
IN 
9 
ENTREPRENEURSHIP AS WELL AS ESTABLISH LINKAGES THAT 
10 
WILL ENABLE MORE OPPORTUNITIES FOR WOMEN TO ENGAGE 
11 
IN ENTREPRENEURSHIP; AND  
12 
"(E) DEVELOPMENT OF ENTREPRENEURIAL EDUCATION AND 
13 
TRAINING.  THE MSMED COUNCIL SHALL DEVELOP, IN 
14 
COORDINATION WITH THE DEPARTMENT OF EDUCATION, 
15 
TECHNICAL 
EDUCATION 
AND 
SKILLS 
DEVELOPMENT 
16 
AUTHORITY, AND COMMISSION ON HIGHER EDUCATION, A 
17 
COURSE 
CURRICULUM 
OR 
TRAINING 
PROGRAM 
IN 
18 
ENTREPRENEURSHIP THAT WILL PROMOTE ENTREPRENEURIAL 
19 
CULTURE AND COMPETENCE. ENTREPRENEURSHIP SHALL BE 
20 
INTEGRATED IN THE CURRICULUM OF EDUCATIONAL AND 
21 
TRAINING INSTITUTIONS IN ALL LEVELS. 
22 
 
23 
SECTION 8. A new subsection is hereby inserted after Section 7-B of the same Act, 
24 
as amended, and numbered as Section 7-C to read as follows:  
25 
"SEC. 7-C. CITY, MUNICIPALITY, AND BARANGAY MSMED COUNCIL. - THERE 
26 
SHALL BE CREATED A MSMED COUNCIL IN EVERY LOCAL GOVERNMENT 
27 
UNIT WHICH SHALL HAVE THE AUTHORITY TO PROPOSE POLICIES THAT ARE 
28 
GEARED 
TO 
ASSIST 
MSMES 
IN 
THE 
AREAS 
OF 
PRODUCTIVITY 
29 
ENHANCEMENT, MARKETING, ACHIEVING SUSTAINABILITY BY EXTENDING 
30 
CREDIT TO CUSTOMERS, AND IMPLEMENTING EFFICIENT LOAN COLLECTION 
31 
SYSTEMS, AMONG OTHER STRATEGIES. 
32 
"THE LOCAL MSMED COUNCIL, IN THE CASE OF A CITY OR MUNICIPALITY, 
33 
SHALL BE COMPOSED OF THE CITY OR MUNICIPAL BUSINESS PERMIT AND 
34 
LICENSING 
OFFICER 
AS 
CHAIRPERSON, 
THE 
PRESIDENT 
OF 
THE 
35 
ASSOCIATION OF BARANGAY CAPTAINS, THE PRESIDENT OF THE 
36 
SANGGUNIANG KABATAAN FEDERATION, THE TOURISM OFFICER, AND THE 
37 
CITY OR MUNICIPAL AGRICULTURIST OR THE CITY PLANNING OFFICER.  
38 
"THE BARANGAY MSMED COUNCIL SHALL BE COMPOSED OF THE PUNONG 
39 
BARANGAY 
AS 
CHAIRPERSON, 
THE 
SANGGUNIANG 
KABATAAN 
40 
CHAIRPERSON, A REPRESENTATIVE OF THE LADIES BRIGADE OR LADIES' 
41 
SECTOR, A REPRESENTATIVE OF THE BARANGAY PUBLIC SAFETY OFFICE, 
42 
AND A REPRESENTATIVE OF THE SENIOR CITIZENS.  
43 


10 
"TO ENSURE THEIR CONTINUED FINANCIAL VIABILITY, THE CITY, MUNICIPAL, 
1 
AND BARANGAY MSMED COUNCILS SHALL COORDINATE AND FORMULATE 
2 
MEASURES TO ENSURE OPERATIONAL. AND FINANCIAL VIABILITY WITHIN 
3 
THEIR TERRITORIAL JURISDICTION, TAKING INTO CONSIDERATION THE 
4 
RELEVANT FACTORS AFFECTING THE CAPACITIES OF THE MSMES." 
5 
 
6 
SECTION 9. Section 8 of the same Act, as amended, is hereby further amended to 
7 
read as follows: 
8 
"SEC. 8. Designation of the Bureau of Micro, Small and Medium 
9 
Enterprise Development as Council Secretariat. – xxx: 
10 
  
"1) to prepare, in coordination with local government units and/or 
11 
associations of local government officials, and recommend annual as 
12 
well as medium-term MICRO, small and medium enterprise 
13 
development plans for approval of the Council;  
14 
"Xxx; 
15 
 "3) to assist the Council in coordinating and monitoring MICRO, 
16 
small and medium enterprise policies and programs and activities of all 
17 
government agencies with respect to MICRO, small and medium 
18 
enterprises; 
19 
 "4) to prepare, collate and integrate all inputs to the Council's 
20 
yearly report on the status of MICRO, small and medium enterprises in 
21 
the country: 
22 
 "xxx.” 
23 
SECTION 10. Section 11 of the same Act, as amended, is hereby further amended to 
24 
read as follows:  
25 
"SEC. 11. Creation of THE Small Business [Guarantee and Finance] 
26 
Corporation. - There is hereby created a body corporate to be known as 
27 
the Small Business [Guarantee and Finance] Corporation, hereinafter 
28 
referred to as the [Small Business Corporation (SB Corporation)] SB 
29 
CORPORATION, which shall be charged with the primary responsibility 
30 
of implementing comprehensive policies and programs to assist MSMEs 
31 
in all areas, including but not limited to finance and information services, 
32 
training and marketing." 
33 
 
34 
SECTION 11. Section 11-A of the same Act, as amended, is hereby further amended 
35 
to read as follows:  
36 
SEC. 11-A. Composition of the Board of Directors and its Powers. - The 
37 
SB Corporation [corporate powers shall be vested on] SHALL HAVE a 
38 
Board of Directors composed of [eleven (11)] THIRTEEN (13) members 
39 
which shall include the following:  
40 


11 
a) The Secretary of Trade and Industry, WHO SHALL ACT AS 
1 
CHAIRPERSON OF THE BOARD UNTIL SUCH TIME THAT THE 
2 
PRESIDENT OF THE PHILIPPINES SHALL HAVE APPOINTED THE 
3 
CHAIRPERSON OF THE BOARD FROM AMONG ITS MEMBERS;  
4 
b) The Secretary of Finance;  
5 
"C) THE PRESIDENT OF THE GOVERNMENT SERVICE INSURANCE 
6 
SYSTEM (GSIS); 
7 
"D) THE PRESIDENT OF THE SOCIAL SECURITY SYSTEM (SSS);  
8 
"[c] E) A private sector representative to be appointed by the President 
9 
OF THE PHILIPPINES upon the recommendation of the MSMED 
10 
Council; 
11 
"[d] F) Seven (7) representatives of the SB Corporation common stock 
12 
shareholders who shall be elected based on proportional distribution, in 
13 
accordance with Section [24] 23 of the REVISED Corporation Code; and 
14 
"[(e)] G)The president of the SB Corporation as ex-officio member and 
15 
to serve as vice chairman of the Board 
16 
"The President OF THE PHILIPPINES shall appoint the [chairman] 
17 
CHAIRPERSON of the Board from among its members.  
18 
"All members of the Board so appointed, except for the ex-officio 
19 
members, shall serve for a term of three (3) years [without 
20 
reappointment.] AND MAY BE REAPPOINTED TO ANOTHER TERM 
21 
UNLESS EARLIER REVOKED. IF THE TERM OF THE INCUMBENT 
22 
MEMBER HAS EXPIRED, THE MEMBER SHALL CONTINUE TO 
23 
FUNCTION IN A HOLDOVER CAPACITY UNTIL A REPLACEMENT 
24 
HAS BEEN APPOINTED AND QUALIFIED. [The] ANY person [so] 
25 
appointed to replace a member who has resigned, died, or been 
26 
removed for cause shall serve only for the unexpired portion of the term.  
27 
"The Board of Directors shall have, among others, the following specific 
28 
powers and authorities:  
29 
"xxx; and 
30 
"f) [Notwithstanding the provisions of Republic Act No. 6758 and 
31 
Compensation Circular No. 10, Series of 1989 issued by the Department 
32 
of Budget and Management, the Board shall have the authority to 
33 
piProvide for the organizational structure, [and] staffing pattern [of SB 
34 
Corporation and to extend to the employees and personnel thereof 
35 
salaries, allowances and fringe benefits similar to those extended to and 
36 
currently enjoyed by employees and personnel of other government 
37 
financial institutions.] AND COMPENSATION OF EMPLOYEES AND 
38 
PERSONNEL OF THE SB CORPORATION, FOR SUBMISSION TO 
39 
THE GOVERNANCE COMMISSION FOR GOCCs." 
40 


12 
SECTION 12. Section 11-B of the same Act, as amended, is hereby further amended, 
1 
to read as follows: 
2 
 "SEC. 11-B. Corporate Structure and Powers. - "A. The SB Corporation 
3 
shall: 
4 
 "xxx. 
5 
  
"B. For this purpose, the SB Corporation [subject to compliance 
6 
with the rules and regulations to be issued by the Bangko Sentral ng 
7 
Pilipinas (BSP) and the Securities and Exchange Commission,] shall 
8 
have the following functions and duties: 
9 
"a) Source and adopt development initiatives for globally 
10 
competitive MSMES in finance and business technologies; 
11 
"b) [To] [e]Extend all forms of financial assistance, 
12 
EXCEPT GRANTS AND SUBSIDIES, to eligible MSMEs[.], AND 
13 
NOT TO PRECLUDE RETAIL LENDING IN AREAS WHERE 
14 
PRIVATE BANKS ARE NOT ABLE TO SERVE, SUBJECT TO 
15 
CONSULTATION WITH PRIVATE BANKS. SB Corporation may 
16 
also engage in wholesale lending. The SB Corporation shall be 
17 
given two (2) years from the effectivity of this Act to comply with 
18 
this requirement; 
19 
"c) [Guarantee loans obtained by qualified MSMEs under 
20 
such terms and conditions adopted by the SB Corporation Board 
21 
of Directors;] ESTABLISH AN ENTERPRISE REHABILITATION 
22 
FUND FOR CALAMITY-STRICKEN MSMES NOT TO EXCEED 
23 
FIVE HUNDRED MILLION PESOS (PS00,000,000.00) AS PART 
24 
OF 
SB 
CORPORATION'S 
CAPITALIZATION 
BY 
THE 
25 
NATIONAL GOVERNMENT;  
26 
"xxx;  
27 
"f) Apply for, receive and accept grants and donations from 
28 
sources within and outside the country; [and]  
29 
"g) Hold, own, purchase, acquire, sell, mortgage, dispose 
30 
or otherwise invest or reinvest in stocks, bonds, treasury bills, 
31 
debentures, securities and similar forms of indebtedness of the 
32 
government, 
its 
agencies 
and 
instrumentalities 
or 
any 
33 
government financial institution[.]; AND  
34 
"H) SUBMIT AN ANNUAL REPORT TO THE MSMED 
35 
COUNCIL, THE CONGRESS OF THE PHILIPPINES AND THE 
36 
GOVERNANCE 
COMMISSION 
FOR 
GOCCs 
ON 
THE 
37 
PERFORMANCE AND FINANCIAL CONDITION OF THE 
38 
CORPORATION.  
39 


13 
"THE SB CORPORATION SHALL BE EXEMPT FROM 
1 
SECURING PRIOR BSP AUTHORIZATION FOR ENGAGING IN 
2 
QUASI-BANKING ACTIVITIES AND SHALL NOT BE SUBJECT 
3 
TO BSP SUPERVISION AND REGULATION FOR SUCH 
4 
ACTIVITIES.” 
5 
SECTION 13. A new subsection is hereby inserted after Section 11-B of the same Act, 
6 
as amended, and numbered as Section 11-C to read as follows: 
7 
"SEC. 11-C. STRATEGIC MANAGEMENT OF THE SB CORPORATION. - THE 
8 
BOARD OF THE SB CORPORATION,THROUGH ITS CHAIRPERSON, SHALL BE 
9 
FULLY RESPONSIBLE AND ACCOUNTABLE FOR THE PERFORMANCE OF THE 
10 
CORPORATION'S MANDATE. TO ENSURE THIS, THE BOARD SHALL BE 
11 
CONSTITUTED AS A MANAGING BOARD, LED BY IT'S CHAIRPERSON, TO 
12 
CONCEPTUALIZE 
THE 
STRATEGIC 
PLANS 
AND 
POLICIES 
OF 
THE 
13 
CORPORATION. 
14 
"THE SB CORPORATION SHALL ADOPT A BALANCED SCORECARD 
15 
MANAGEMENT APPROACH, SUBJECT TO THE REVIEW AND APPROVAL OF 
16 
THE GOVERNANCE COMMISSION FOR GOCCS, TO ENABLE IT TO MANAGE 
17 
ITS FINANCIAL PERFORMANCE WHILE PURSUING ITS PUBLIC POLICY 
18 
OBJECTIVES OF SUPPORTING MICRO, SMALL AND MEDIUM ENTERPRISES 
19 
DEVELOPMENT." 
20 
SECTION 14. Section 12 of the same Act, as amended, is hereby further amended to 
21 
read as follows: 
22 
 "SEC. 12. Capitalization and Funding of the SB Corporation. - The SB Corporation 
23 
shall have an authorized capital stock of Ten billion pesos (P10,000,000,000.00). The 
24 
initial capital of One billion pesos (P1,000,000,000.00) shall be established from a pool 
25 
of funds to be contributed in the form of equity investments in common stock by the 
26 
Land Bank of the Philippines (LBP), the Development Bank of the Philippines (DBP), 
27 
in the amount of Two hundred million pesos (P200,000,000.00) each. The Social 
28 
Security System (SSS) and the Government Service Insurance System (GSIS) shall 
29 
also set aside Two hundred million pesos (P200,000,000.00) each for the SB 
30 
Corporation. Authorized capital stock of the [s]Small [b|Business [c]Corporation shall 
31 
be divided into 80,000,000 common shares and 20,000,000 preferred shares with a 
32 
par value of One hundred pesos (P100.00) per share: Provided, That the common 
33 
shares which have been issued, including those issued against the assets of the KKK 
34 
Guaranty Fund consolidated under the [s]Small [b]Business [c]Corporation by virtue 
35 
of Executive Order No. 233, Series of 2000 and Executive Order No. 19, Series of 
36 
2001 and including those already subscribed, shall form part of the capitalization of 
37 
the corporation: 
38 
Provided, further, That holders of preferred shares issued under Republic Act No. 
39 
6977, as amended, shall have the option to convert the same into common shares. 
40 
Additional equity funding shall come from trust placements of excess and unused 
41 
funds of existing government agencies, bilateral and multilateral official development 
42 
assistance funds, subscriptions from government owned or controlled corporations 
43 
AND THE NATIONAL GOVERNMENT THROUGH THE DEPARTMENT OF 
44 
BUDGET AND MANAGEMENT (DBM), and investments of private financial 
45 


14 
institutions and corporations: Provided, finally, That any investment from the private 
1 
sector shall only be in the form of preferred shares. 
2 
  
“[To allow for capital build-up, SB Corporation shall be given a five (5) year 
3 
grace period on dividend commitments beginning on the date of effectivity of this 
4 
amendment. Thereafter, it] THE SB CORPORATION may [only] declare as dividend 
5 
not more than thirty percent (30%) of its net income and the rest withheld as retained 
6 
earnings." 
7 
 
8 
SECTION 15. Section 13 of the same Act, as amended, is hereby deleted. 
9 
"[SEC. 13. The SB Corporation shall be subject to the supervision and examination of 
10 
the Bangko Sentral ng Pilipinas taking into consideration its developmental 
11 
objectives."] 
12 
SECTION 16. Section 14 of the same Act, as amended, is hereby renumbered as 
13 
Section 13, and further amended to read as follows: 
14 
"SEC. [14]13. Venture Capital and Micro Finance Trust Fund. - The SB 
15 
Corporation may set aside an amount of money to encourage the setting 
16 
up of a venture capital and micro finance trust fund for the purpose of 
17 
promoting AVAILABLE business opportunities [available] to THE MSME 
18 
sector. The Venture Capital Fund shall be used mainly for venture capital 
19 
finance especially in technology-oriented industries. The micro finance 
20 
trust fund shall be used to provide collateral-free fixed and working 
21 
capital loans to micro and small enterprises run by those emerging out 
22 
of poverty. THE INITIAL AMOUNT OF AT LEAST TEN PERCENT 
23 
(10%) OF THE EQUITY CONTRIBUTION OF THE NATIONAL 
24 
GOVERNMENT TO THE CAPITALIZATION OF THE SMALI, 
25 
BUSINESS CORPORATION, NOT TO EXCEED FIVE HUNDRED 
26 
MILLION PESOS (P500,000,000.00), SHALL BE APPROPRIATED TO 
27 
FUND THE VENTURE CAPITAL AND MICRO FINANCE TRUST 
28 
FUND." 
29 
SECTION 17. Section 15 of the same Act, as amended, is hereby renumbered as 
30 
Section 14, and further amended to read as follows. 
31 
“SEC. [15]14. Mandatory Allocation of Credit Resources to Micro, Small 
32 
and Medium Enterprises. - For the period of ANOTHER ten (10) years 
33 
from the date of the effectivity of this amendatory Act, all lending 
34 
institutions [as defined under Bangko Sentral ng Pilipinas rules], whether 
35 
public or private, shall set aside at least [eight percent (8%) for micro 
36 
and small enterprises and at least two percent (2%) for medium 
37 
enterprises] TEN PERCENT (10%) of their total loan portfolio based on 
38 
their balance sheet as of the end of the previous quarter FOR MICRO, 
39 
SMALL AND MEDIUM ENTERPRISES, and make it available for MSME 
40 
credit as herein contemplated: PROVIDED, THAT A MAXIMUM OF 
41 
ONE PERCENT (1%) THEREOF SHALL BE THE ALLOCATION FOR 
42 
MEDIUM ENTERPRISES. 
43 


15 
 "Compliance of this provision shall be: 
1 
*a) actual extension of loans to eligible MSMEs; or 
2 
"xxx; or 
3 
 "f) [subscribe] SUBSCRIPTION/purchase of liability instruments 
4 
as may be offered by the SB Corporation. THE SAME SHALL NOT BE 
5 
DEEMED AS QUASI-BANKING OPERATIONS, AND SHALL NOT 
6 
REQUIRE A QUASI-BANKING LICENSE FROM THE BSP; OR 
7 
  
"(G) EXTENSION OF LOANS TO MSME VALUE CHAIN 
8 
ACTORS WHO ALLOW MSMES TO PARTICIPATE IN ORGANIZED 
9 
OR FORMAL VALUE CHAINS. VALUE CHAIN ACTORS INCLUDE, 
10 
AMONG 
OTHERS, 
TRADERS, 
SUPPLIERS, 
PROCESSORS, 
11 
AGGREGATORS WHO CONDUCT LINKED SEQUENCE OF VALUE 
12 
ADDING ACTIVITIES INVOLVED IN BRINGING A PRODUCT TO 
13 
FINAL CONSUMERS. 
14 
 
“The Banko Sentral ng Pilipinas AND THE SECURITIES AND 
15 
EXCHANGE COMMISSION, IN CONSULTATION WITH THE MSMED 
16 
COUNCIL AND THE DEPARTMENT OF TRADE AND INDUSTRY, 
17 
shall formulate rules for the effective implementation of this provision: 
18 
Provided, That the purchase of government notes, securities and other 
19 
negotiable instruments shall not be deemed compliance with the 
20 
foregoing provisions: Provided, further, That the Bangko Sentral ng 
21 
Pilipinas AND THE SECURITIES AND EXCHANGE COMMISSION, IN 
22 
CONSULTATION WITH ALL STAKEHOLDERS, shall establish [an] A 
23 
MEANINGFUL incentive [program] SYSTEM to encourage [lending to 
24 
micro, small and medium industries beyond the mandatory credit 
25 
allocation to said enterprises,] COMPLIANCE WITH THIS PROVISION, 
26 
such as possible reduction in bank’s reserve requirement [.]: 
27 
PROVIDED, FINALLY, THAT THE BANGKO SENTRAL NG 
28 
PILIPINAS AND THE SECURITIES AND EXCHANGE COMMISSION 
29 
SHALL ALIGN THEIR REGULATIONS ON THE PENALTIES FOR 
30 
BANKS AND OTHER ENTITIES, FOR NONCOMPLIANCE WITH THE 
31 
PROVISION FOR MANDATORY LENDING. 
32 
 
“The MSMED Council shall set up the appropriate systems to 
33 
monitor all loan applications of MSMEs in order to account for the 
34 
absorptive 
capacity 
of 
the 
MSME 
sector. 
EACH 
LENDING 
35 
INSTITUTION SHALL DESIGNATE A CHIEF COMPLIANCE AND 
36 
NONCOMPLIANCE WITH THE MANDATORY CREDIT ALLOCATION, 
37 
FOR SUBMISSION TO THE BANGKO SENTRAL NG PILIPINAS IN 
38 
THE CASE OF BANKS, AND THE SECURITIES AND EXCHANGE  
39 
COMMISSION 
IN 
THE 
CASE 
OF 
NON-BANK 
FINANCIAL 
40 
INTERMEDIARIES, shall furnish to the MSMED Council on a quarterly 
41 
basis comparative reports on the [bank’s] LENDING ENTITY’S 
42 
compliance [,] AND noncompliance [and penalties of] WITH the above 
43 
provisions on the mandatory credit allocation for MSMEs [.], AND 
44 
SHALL SUBMIT AN ANNUAL REPORT, SIGNED BY AN OFFICER 
45 


16 
WITH THE RANK OF AT LEAST A MANAGING DIRECTOR, ON THE 
1 
AMOUNTS OF THE PENALTIES FOR NONCOMPLIANCE WITH THE 
2 
MANDATORY LENDING PROVISION OF THIS ACT. 
3 
 
“ALL BANKS SHALL PROVIDE ACCESS TO DEPOSIT 
4 
ACCOUNTS, SUCH AS SAVINGS, CHECKING AND DEBIT 
5 
ACCOUNTS, TO REGISTERED MSMEs FINANCIAL TECHNOLOGY 
6 
SHALL BE PROVIDED TO MSMEs TO ENSURE THEIR FINANCIAL 
7 
INCLUSION. 
8 
 
“ALL LENDERS SHALL REPORT CREDIT INFORMATION 
9 
AND TRANSACTIONS OF MSMEs TO A NATIONAL CREDIT 
10 
REGISTRY TO MONITOR PROPER COMPLIANCE AND EFFICIENT 
11 
IMPLEMENTATION. 
12 
“FOR EFFICIENT IMPLEMENTATION AND OPERATION, 
13 
COOPERATIVES 
EXCEPT 
COOPERATIVE 
BANKS 
AND 
14 
INSURANCE COOPERATIVES SHALL BE UNDER THE SOLE 
15 
SUPERVISION AND EXAMINATION OF THE COOPERATIVE 
16 
DEVELOPMENT AUTHORITY (CDA); ALL OTHER FINANCIAL 
17 
ENTITIES, CORPORATIONS AND FINANCIAL INTERMEDIARIES, 
18 
SUCH AS NON-GOVERNMENT ORGANIZATIONS, FINANCING 
19 
COMPANIES, NON-STOCK SAVINGS AND LOAN ASSOCIATIONS, 
20 
MICROFINANCE 
NON-GOVERNMENT 
ORGANIZATIONS, 
AND 
21 
LENDING INVESTORS SHALL BE UNDER THE SECURITIES AND 
22 
EXCHANGE COMMISSION (SEC); BANKS SHALL BE UNDER THE 
23 
BANGKO SENTRAL NG PILIPINAS (BSP): AND INSURANCE 
24 
COMPANIES SHALL BE UNDER THE INSURANCE COMMISSION 
25 
(IC). FOR CLARITY, COOPERATIVE BANKS SHALL BE UNDER THE 
26 
SUPERVISION AND EXAMINATION OF THE CDA AND BSP; WHILE 
27 
INSURANCE 
COOPERATIVES 
SHALL 
BE 
UNDER 
THE 
28 
SUPERVISION AND EXAMINATION OF THE CDA AND INSURANCE 
29 
COMMISSION (IC).  
30 
"Lending institutions which are not qualified to acquire or hold 
31 
lands of the public domain in the Philippines shall be permitted to bid and 
32 
take part in sales of mortgaged real property in case of judicial or extra-
33 
judicial foreclosure, as well as avail of receivership, enforcement and 
34 
other proceedings, solely upon default of a borrower, and for a period 
35 
not exceeding five (5) years from actual possession: Provided, That in 
36 
no event shall title to the property be transferred to such lending 
37 
institution. If the lending institution is the winning bidder, it may, during 
38 
said five (5) year period, transfer its rights to a qualified Philippine 
39 
national, without prejudice to a borrower's rights under applicable laws." 
40 
 
41 
SECTION 18. Sections 16 and 17 of the same Act, as amended, are hereby 
42 
renumbered as Sections 15 and 16, respectively, to read as follows: 
43 
"SEC. [16]15. Micro, Small, and Medium Enterprise Week. - xxx." 
44 


17 
"SEC. [17]16. Presidential Awards for Outstanding MSME. - xxx.” 
1 
SECTION 19. Section 18 of the same Act, as amended, is hereby renumbered as 
2 
Section 17, and further amended to read as follows: 
3 
"SEC. [18] 17. Congressional Oversight Committee. - To monitor and 
4 
oversee the implementation of this Act, there shall be a Congressional 
5 
Oversight Committee on Micro, Small and Medium Enterprise 
6 
Development (COC-MSMED) composed of the chairpersons of the 
7 
Senate Committee on Economic Affairs and the House Committee on 
8 
[Small Business and Entrepreneurship Development] MICRO, SMALL 
9 
AND MEDIUM ENTERPRISE DEVELOPMENT as chairperson and co-
10 
chairperson, respectively; xxx." 
11 
 
12 
SECTION 20. Section 19 of the same Act, as amended, is hereby renumbered as 
13 
Section 18, and further amended, to read as follows:  
14 
"SEC. [19] 18. Penal Clause. - The Bangko Sentral Ng Pilipinas IN THE 
15 
CASE OF BANKS, AND THE SECURITIES AND EXCHANGE 
16 
COMMISSION 
IN 
THE 
CASE 
OF 
NON-BANK 
FINANCIAL 
17 
INTERMEDIARIES, shall impose administrative sanctions and other 
18 
penalties on the lending institutions for non|-compliance with THE 
19 
provisions of this Act [including a fine of not less than Five hundred 
20 
thousand pesos (P500,000.00)]. THE MINIMUM AMOUNT FOR THE 
21 
PENALTY FOR NONCOMPLIANCE IS FIVE HUNDRED THOUSAND 
22 
PESOS (P500,000.00) AND THE MAXIMUM PENALTY IS FIVE 
23 
MILLION PESOS (P5,000,000.00), IN PROPORTION TO THE BANK'S 
24 
OR OTHER ENTITY'S LEVEL OF COMPLIANCE: PROVIDED, THAT 
25 
IN CASE OF FAILURE OF THE MANDATED ENTITIES TO COMPLY 
26 
WITH THE MANDATORY CREDIT ALLOCATION SET OUT IN 
27 
SECTION 
14 
OF 
THIS 
ACT, 
AN 
ADDITIONAL 
PENALTY 
28 
EQUIVALENT TO TWENTY PERCENT (20%) PER ANNUM OF THE 
29 
TOTAL AMOUNT OF NON-COMPLIANCE SHALL BE IMPOSED.  
30 
"Penalties on noncompliance shall be directed to the development of the 
31 
MSME sector. Ninety percent (90%) of the penalties collected [should] 
32 
SHALL go to the [MSMED Council Fund] "START-UP FUND" AS 
33 
PROVIDED UNDER REPUBLIC ACT NO. 10644, OTHERWISE 
34 
KNOWN AS THE "GO NEGOSYO ACT", while the remaining ten 
35 
percent (10%) [should] SHALL be [given] REMITTED to the BSP, THE 
36 
SECURITIES 
AND 
EXCHANGE 
COMMISSION, 
OR 
THE 
37 
APPROPRIATE 
AGENCY 
THAT 
EXERCISES 
REGULATORY 
38 
JURISDICTION OVER SUCH LENDING ENTITY, to cover for 
39 
administrative expenses. 
40 
"THE MSMED COUNCIL SHALL SUBMIT TO THE CONGRESS OF 
41 
THE PHILIPPINES AN ANNUAL REPORT ON THE STATUS OF THE 
42 
PENALTIES REMITTED AND HOW THE SAME WERE USED OR ARE 
43 
BEING USED IN RELATION TO THE IMPLEMENTATION OF 
44 
SERVICES TO MSMES IN THE AREAS OF CAPACITY BUILDING, 
45 


18 
TECHNOLOGY INFORMATION, INFORMATION COLLECTION AND 
1 
DISSEMINATION, AND OTHER INTERVENTIONS FOR MSME 
2 
DEVELOPMENT, GROWTH AND SUSTAINABILITY.” 
3 
 
4 
SECTION 21. A new section, numbered Section 19, is hereby inserted after re-
5 
numbered Section 18 of the same Act, as amended, to read as follows: 
6 
"SEC. 19. OTHER VIOLATIONS. - EXCEPT FOR SECURITIES COVERED 
7 
UNDER THE SECURITIES REGULATIONS CODE OR REPUBLIC ACT NO. 
8 
8799, ENTITIES SHALL SECURE THE NECESSARY APPROVAL OF THE 
9 
SECURITIES AND EXCHANGE COMMISSION PRIOR TO RECEIVING 
10 
INVESTMENTS AS WELL AS GIFTS, ITEMS OR OTHER COMMODITIES, 
11 
EITHER IN THE FORM OF CASH OR ITS EQUIVALENT CASH VALUE IN 
12 
CONSIDERATION OF RETURN OF PROFIT, BENEFIT, OR BLESSINGS 
13 
COMING FROM MORE THAN TWENTY (20) INDIVIDUALS, OR SUFFER 
14 
THE PENALTY OF THIRTY (30) TO ONE HUNDRED EIGHTY (180) DAYS 
15 
IMPRISONMENT, OR A FINE OF NOT LESS THAN TEN THOUSAND 
16 
PESOS (P10,000.00) BUT NOT EXCEEDING ONE HUNDRED THOUSAND 
17 
PESOS (P100,000.00) OR BOTH, AT THE DISCRETION OF THE COURT. 
18 
"ANY PERSON, WHETHER NATURAL OR JURIDICAL, WHO FAILS TO 
19 
ACQUIRE THE APPROVAL OF THE FOOD AND DRUGS AUTHORITY 
20 
(FDA) AND THE DEPARTMENT OF TRADE AND INDUSTRY (DTI) FOR 
21 
SELLING, MARKETING, AND DISTRIBUTING PRODUCTS AND SERVICES 
22 
THAT ARE REGULATED BY THE FDA SHALL SUFFER THE PENALTY OF 
23 
THIRTY 
(30) 
DAYS 
TO 
ONE 
HUNDRED 
EIGHTY 
(180) 
DAYS 
24 
IMPRISONMENT, OR A FINE OF NOT LESS THAN TEN THOUSAND 
25 
PESOS (P10,000.00) BUT NOT EXCEEDING ONE HUNDRED THOUSAND 
26 
PESOS (P100,000.00) OR BOTH, AT THE DISCRETION OF THE COURT.” 
27 
SECTION 22. Implementing Rules and Regulations (IRR). - The Department of Trade 
28 
and Industry, through the Bureau of Micro, Small and Medium Enterprise Development 
29 
and in consultation with the Bangko Sentral ng Pilipinas in the case of banks, and the 
30 
Securities and Exchange Commission in the case of non-bank financial intermediaries, 
31 
and other concerned government agencies, nongovernment organizations and private 
32 
sector agencies involved in the promotion of M.SMEs, shall formulate the rules and 
33 
regulations (IRR) necessary to implement the provisions of this Act within ninety (90) 
34 
days from the approval of this Act: Provided, That the IRR shall be reviewed yearly: 
35 
Provided, further, That the IRR shall be approved by the MSMED Council. 
36 
 
37 
SECTION 23. Separability Clause. - The provisions of this Act are hereby declared to 
38 
be separable. If any provision of this Act shall be held unconstitutional, the remainder 
39 
of this Act not otherwise affected shall remain in full force and effect. 
40 
 
41 
SECTION 24. Repealing Clause. -Section 22 of Republic Act No. 8367 is hereby 
42 
repealed. laws, decrees, proclamations, issuances, or ordinances that are contrary to 
43 
or All inconsistent with the provisions of this act are hereby amended, repealed or 
44 
modified accordingly. 
45 
 
46 


19 
SECTION 25. Effectivity. - This Act shall take effect fifteen (15) days after its 
1 
publication in the Official Gazette or in a newspaper of general circulation. 
2 
Approved, 
3