1https://theaseanpost.com/article/aseans-cocoa-bean-production-under-threat  
2 http://www.pcaf.da.gov.ph/wp-content/uploads/2022/06/Philippine-Cacao-Industry-Roadmap-2021-
2025.pdf  
3 https://www.dti.gov.ph/archives/regional-archives/region-4a-news-regional-archives/dti-da-hold-forum-on-
strengthening-ph-cacao-industry/  
4 https://www.da.gov.ph/2017-2022-cacao-and-coffee-industry-roadmaps/  
5 https://www.globenewswire.com/en/news-release/2020/12/02/2138092/28124/en/Insights-on-the-Cocoa-
Powder-Global-Market-to-2025-by-Type-Application-Distribution-Channel-and-Geography.html  
Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ____ 
Introduced by HON. TSUYOSHI ANTHONY G. HORIBATA 
EXPLANATORY NOTE 
The Cacao Industry in the Philippines desperately needs national government 
intervention to assure its stability and development. Despite being ideal for cacao 
plantation and production, the country has not been on par with other leading ASEAN 
countries like Indonesia and Malaysia who are continually on the top of cocoa bean 
production1. 
The country is a net importer of cacao that averages around USD 168.3 million 
worth of imports but only has around USD 22.1 million in export value. Major chocolate 
producers in the country, who seldom purchase domestic cocoa beans, are credited 
with the substantial import of cocoa powder and the high export value of chocolate. 
They also make their products with imported cocoa butter and powder2. 
According to a Department of Agriculture report, the Philippines has an 
estimated global demand of 4.7 million to 5 million metric tons by 20203. Nonetheless, 
a cocoa shortage of 1 million metric tons is predicted. Annual domestic consumption 
is 50,000 metric tons, while national domestic supply is only around 10,000 metric 
tons4. 
Despite the data in the country, it is noted in the “Cocoa Powder Market – 
Forecasts from 2020 to 2025” that the worldwide cocoa industry, most especially the 
Asia Pacific region, is predicted to grow at a significant pace during the forecast period 
owing to the wide popularity of cocoa powder among the end-user industries. Cacao’s 
wide use as an important ingredient in the food and beverage industry further propels 
the market demand within 2020 to 20255. 
December 12, 2022
10:39 am
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The same study also predicted that due to the pandemic that resulted to 
lockdowns within Europe, West Africa, particularly Ivory Coast and Ghana – the top 
cacao and cocoa producing countries – led to the difficulty of the production of the 
products mentioned, which is further backed by a Fourth Quarter 2021 report of cocoa 
output decline in the mentioned West African countries6. 
Consequently, it is high time for the Philippines to step up its productivity in 
cacao and cocoa products to not only reach the national demand but also work its way 
up to not only among the top ASEAN countries in terms of cacao and cocoa 
production, as well as among the top in the whole world. 
Thus, this bill seeks to establish the National Cacao Authority as the legal body 
and leading agency for the further development of the cacao industry in the country 
and other matters thereof. The establishment of the Authority would also give our local 
farmers the opportunity to enter the cacao market and/or industry with the help of the 
national government. 
Given the foregoing, immediate passage of this bill is earnestly sought. 
TSUYOSHI ANTHONY “HORI” G. HORIBATA 
6https://www.confectionerynews.com/Article/2022/02/10/fourth-quarter-decline-in-cocoa-output-in-ghana-
and-cote-d-ivoire-surprises-icco  


Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ____ 
Introduced by  
HON. TSUYOSHI ANTHONY G. HORIBATA 
AN ACT CREATING THE NATIONAL CACAO AUTHORITY TO ACCELERATE THE 
DEVELOPMENT OF THE CACAO INDUSTRY IN THE PHILIPPINES, PROVIDING FOR A CACAO 
DEVELOPMENT FUND, AND FOR OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
SECTION 1. Title. – This Act shall be known as the “National Cacao Development Act of 2022”. 
SEC. 2. Declaration of Policy. – It is hereby declared the policy of the State to strive for national 
self-sufficiency in cacao and its products as a vital feature in the attainment of a self-reliant 
and independent Philippine economy in the provision of proper nutrition and the generation 
of more employment opportunities for the people. It is also the policy of the State to 
recognize the primary role of the private sector in research, training, production, processing, 
and marketing, and to provide incentives to those undertaking these activities, with the 
government limiting itself to policy-making, facilitation, and regulation. 
Towards this end, the State shall create an agency tasked to help the private sector accelerate 
the development and growth of the Philippine cacao industry under the spirit of 
cooperativism in all stages of cacao production, processing, distribution, marketing, and other 
cacao-related activities, in such a way that market viability of cacao plants and products shall 
be ensured, focusing on developing breeds adapted to Philippine conditions.  Likewise, the 
State shall help establish marketing networks and outlets, especially among and between 
processors and end-users, which may include the integration of local chocolate production 
with existing industrial cacao farms geared towards the sufficient production of local cacao 
for the needs of the people. 
SEC. 3. Objectives. – The objectives of this Act are as follows: 
(a) To promote and provide direction for the accelerated development of the Philippine cacao
industry, consistent with the provisions of this Act;
(b) To give support and assistance in the production, processing, and marketing activities of
all those engaged in the business of producing chocolate and other cacao products,
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particularly rural-based small cacao farmers through the provision of necessary support 
systems; 
(c) To encourage and promote the active participation of farm families, rural cooperatives, 
and the private sector recognizing them as principal agents in the development of the 
Philippine cacao industry; 
(d) To ensure an adequate supply of cacao and other cacao products at affordable prices; 
(e) To improve livelihood opportunities and thereby increase income levels through cacao 
planting and production; 
(f) To provide market solutions for the issues and/or problems of the cacao industry in the 
country; 
(g) To develop and disseminate appropriate smallholder-based cacao technology; 
(h) To improve cacao production from existing stock and systematically program the build-up 
of productive chocolate factories; and 
(i) To conserve foreign exchange by supporting local cacao production. 
 
SEC. 4. The National Cacao Authority. – To achieve the objectives of this Act, there is hereby 
created a National Cacao Authority (NCA), hereafter referred to as the “Authority”, which 
shall, for the purpose of policy and program coordination, be attached to the Department of 
Agriculture. 
 
The Authority shall be the central policy-determining and directing body tasked to ensure the 
accelerated development of the Philippine cacao industry, in accordance with the policies and 
objectives set forth in this Act. 
 
SEC. 5. The Cacao Industry Board. – The National Cacao Authority shall be governed by a 
Cacao Industry Board, hereafter referred to as the “Board”, to be composed of the following: 
(a) The Secretary of Agriculture, a chairperson; 
(b) The NCA Administrator, as an ex officio member; 
(c) The Secretary of Trade and Industry, as a member; 
(d) The Secretary of Health, as a member; 
(e) The Secretary of Education, Culture and Sports, as a member; 
(f) The Secretary of Science and Technology, as a member; 
(g) The Secretary of Agrarian Reform, as a member; 
(h) The Director of the Philippine Cacao Industry Association, Inc., as a member; and 
(i) Four (4) other members who shall be appointed by the President of the Philippines upon 
the recommendation of the chairperson: Provided, That one (1) shall come from the 
commercial cacao processors’ group and the other three (3) from the cacao cooperatives 
and/or private cacao organizations, with one representative each from Luzon, Visayas, and 
Mindanao: Provided, further, that they will hold office for a period of three (3) years from the 
date of their respective appointments without reappointment; Provided, finally, that any 
member appointed to a vacancy shall serve only for the unexpired term of the member whom 
he succeeds. 
 
SEC. 6. Powers and Functions of the National Cacao Authority. – The National Cacao Authority 
shall have the following powers and functions: 
a) To formulate and execute cacao programs that will generate a national impact on rural as 
well as urban nutrition levels and incomes; 


  
b) To assist in the purchase, importation, propagation, storage, distribution, and sale of cacao 
seeds, fertilizers, supplies, appropriate equipment, engineering supplies, and such other 
inputs as may be needed by the cacao industry; 
c) To encourage the integration of cacao production and local cacao and the distribution of 
cacao products into various rural livelihood and nutrition programs; 
d) To assume control and supervision over all cacao-related government agency personnel 
and programs, other cacao-related government agencies, divisions, and councils subject to 
the guidelines prescribed by the Civil Service Commission; 
e) To borrow, raise or obtain funds; to issue bonds and other instruments of indebtedness; or 
to enter into any financial or credit arrangement in order to support or carry out its objectives 
and purposes, subject to pertinent laws governing public debts and expenditures; 
f) To receive grants, subsidies, donations, or contributions from corporations, trusts, 
foundations, associations, and other sources from any private or government office, agency, 
or corporation in the Philippines or abroad; 
g) To establish, maintain or operate field units or offices in various parts of the country in 
order to utilize the objectives of this Act; 
h) To establish, maintain or operate local cacao processing centers in districts, cities, 
provinces, or regions that will meet the criteria which will be set by the Authority 
i) To help design and implement a credit system that will finance cacao farmers and cacao 
cooperatives or associations; 
j) To charge reasonable fees for services rendered for the attainment of the objectives of this 
Act; 
k) To promulgate rules and regulations to carry out the provisions and policy objectives of this 
Act;  
l) To adopt, alter and use a corporate seal; to sue and be sued; and otherwise, to do and 
perform all acts or exercise all powers as may be necessary or incidental to carry out the 
objectives of this Act; and 
m) To explore and expand the domestic and foreign markets for Cacao products and 
byproducts. 
 
SEC. 7. Meeting of the Board. – The Board shall convene in a regular monthly meeting and 
shall hold special meetings when necessary.  The presence of at least seven (7) members of 
the Board shall constitute a quorum and the vote of a majority of those present shall be 
sufficient to transact business during any meeting: Provided, That the department secretaries 
can be represented on a permanent basis by their respective undersecretaries or assistant 
secretaries who will have full voting power and shall be considered in the determination of 
quorum: Provided, finally, that the chairperson shall not vote except in case of a tie. 
 
SEC. 8. Allowance of the Board Members. – The chairperson and members of the Board shall 
be entitled to per diems and other allowable emoluments as may be fixed by the Board for 
every meeting actually attended, subject to existing laws, rules, and regulations which, in no 
case, shall exceed ten thousand pesos (Php 10,000.00) per month: Provided, however, That 
the transportation expenses for representatives from far places will be reimbursed: Provided, 
finally, That the Administrator of the Authority, as an ex officio member of the Board, shall 
receive only the remuneration and allowances which shall be provided by the Board for the 
said position. 
 


  
Whenever the exigencies of the service demand, and the Board, for any valid reason, cannot 
be convened to a meeting, the Administrator, in coordination with the Board Secretary, is 
hereby authorized to submit any matter for resolution by memorandum and the concurrence 
of a majority of the Board members and/or alternates constituting a quorum shall be 
considered sufficient for the approval thereof. 
 
SEC. 9. Management of the Authority. – There shall be a full-time Administrator who shall 
manage the operations of the Authority, to be assisted by a Deputy Administrator. Both the 
Administrator and the Deputy Administrator shall be appointed by the President of the 
Philippines. 
 
The Administrator shall be a citizen of the Philippines; at least thirty (30) years of age on the 
date of his appointment; of good moral character; with recognized executive ability and 
competence; and preferably well-versed in the various aspects of the cacao industry. 
 
The salary and allowances of the Administrator and Deputy Administrator shall be in 
accordance with the provisions of R.A. 11466 or “Salary Standardization Law of 2019”. 
 
SEC. 10. Powers and Functions of the Administrator. – Subject to the control and supervision 
of the Board, the Administrator shall have the following powers and functions: 
a) Submit policy recommendations and proposed measures necessary to carry out the 
objectives and functions of the Authority, for the consideration of the Board; 
b) Recommend to the Board, for approval, an organizational structure, and plantilla of 
personnel of the Authority, in accordance with existing laws, rules and regulations; 
c) Execute, administer and implement policies and measures approved by the Board; 
d) Submit to the Board, in line with the national budget cycle, an annual budget, and such 
supplemental budget as may be necessary for its consideration and approval; 
e) Represent the Authority in all its dealings with other persons, entities, agencies, and 
institutions whether public or private, domestic or foreign, subject to the limitations and 
conditions herein provided; 
f) Appoint, subject to the confirmation of the Board, and discipline or remove for cause in 
accordance with the civil service law, rules, and regulations, the officers and personnel of the 
Authority; and 
g) Perform such other duties which may be assigned to them by the Board or by the Secretary 
of the Department of Agriculture. 
 
SEC. 11. Cacao Cooperative and Farmers’ Organizations. – The Authority shall help organize 
small producers and processors of cacao into cooperatives or other forms of organizations to 
achieve the purposes of this Act including the following: 
a) To facilitate collective arrangements that will enable cooperatives to acquire cacao seeds, 
plants and other supplies, materials, equipment, services of all kinds, and other cacao inputs 
under favorable terms; 
b) To provide a forum for the members of cooperatives to discuss common problems affecting 
production, marketing, and the cooperatives’ relationships with the Authority; 
c) To help design credit systems that will provide loans, grants, and such services as may be 
required, to cacao cooperatives and duly accredited people’s organizations; 


  
d) To assist cooperatives in developing market channels and in negotiations for bulk outlets 
of chocolate output; 
The authority shall support the formation of a Cacao Cooperatives Federation among cacao 
cooperatives as a channel of its coordinative function in the industry. 
 
SEC. 12. National Cacao Campaign. – The Authority shall promote a nationwide campaign to 
boost support for the realization of the objectives of this Act. It shall encourage the 
participation of women’s groups in cacao and cacao-related projects including cacao 
plantation programs, village nutrition schemes, community-based processing, and marketing 
of chocolate and cacao products. 
 
SEC. 13. Priority Projects. – Immediately after the approval of this Act, the Authority, in 
coordination with other related agencies, shall undertake vigorously the following: 
a) Educational programs for cacao farmers and cacao cooperatives including, but not limited 
to, the conduct of seminars, workshops, assemblies, and others; 
b) Training programs including, but not limited to, courses in horticulture, intercropping, 
seeds technology, cacao cooperatives management, and other related aspects of cacao 
planting; 
c) Cacao research and development including but not limited to, horticulture, intercropping, 
seeds improvement, indigenous and agri-waste soil fertilizer sourcing, product development, 
cacao facilities fabrication, and others; 
d) Establishment of support services to cacao farmers and cooperatives in the acquisition of 
basic supplies and inputs for plant health and nutrition; and 
e) Boost the number and quality of local cacao seeds through applied technology. 
 
SEC. 14. Cacao Development Fund. – To implement Section 13 of this Act, a Cacao 
Development Fund is created, which shall be used exclusively for the above-mentioned 
programs in the amount of Two hundred million pesos (Php 200,000,000) from the funds in 
the National Treasury not otherwise appropriated. Annually thereafter, the amount of not 
less than one hundred fifty million pesos (Php 150,000,000) shall be provided to augment the 
fund in the General Appropriations Act. 
 
SEC. 15. Government Agency Support. – The Authority shall coordinate closely with other 
government agencies in the establishment of support services for the cacao industry, 
including, among others, needed infrastructure, and the setting of tariff rates to countervail 
subsidized imports. 
 
SEC. 16. Nutrition Programs. – The government’s nutrition programs requiring chocolate and 
cacao products shall be sourced from small farmers and cacao cooperatives in coordination 
with the Authority. 
 
SEC. 17. Supply and Distribution. – The Authority shall monitor the importation, manufacture, 
supply, and distribution of cacao products and raw materials for the manufacture or 
processing of chocolate and cacao products, as well as the importation and exportation of 
cacao seeds, if the needs of the industry requirements, it shall, after public hearing and after 
consultations with the National Economic and Development Authority, the Department of 
Trade and Industry, the Department of Finance, and the representatives of the cacao 


  
cooperatives and the commercial sector, set guidelines for the importation, exportation, and 
pricing of cacao pods, cacaos seeds, raw materials and other products necessary for the 
manufacture or processing of chocolate and cacao products: Provided, That within a period 
of three (3) years from the effectivity of this Act, the cacao cooperatives and the commercial 
sector shall, subject to quality and price considerations, mutually agree upon a volume of local 
chocolate production to be absorbed by the commercial sector. 
 
If at the end of the three-year period, the parties mentioned above have not come to a mutual 
agreement, the commercial sector shall absorb a fixed portion of the local cacao and/or 
chocolate supply to be determined by the Authority. 
 
Processors who purchase locally produced chocolate from cacao cooperatives in excess of the 
volume prescribed by the Authority shall be accorded tax credits equivalent to ten percent 
(10%) of the value of the excess volume purchased. 
 
SEC. 18. Exemption from Taxes and Duties. – The authority shall be exempt from the payment 
of customs duties and taxes on the importation of cacao pods, cacao seeds, cacao plants, 
fertilizers and other supplies, other farm inputs, cacao equipment, and machinery, including 
its spare parts, for distribution to cacao cooperatives subject to the following conditions: 
(1) That said equipment and machinery, including its spare parts, are not manufactured 
domestically in sufficient quantity, of comparable quality, and at reasonable prices; 
(2) That it shall be actually, directly and exclusively used by the cacao cooperatives in the 
manufacture of its products; 
(3) That it shall not be disposed of within three (3) years from acquisition, without prior 
approval of the Authority; and 
(4) If it will be subsequently sold, transferred, or exchanged in the Philippines to non-exempt 
persons or entities, the purchasers or recipients shall be considered the importers thereof, 
and shall be liable for the customs duties and internal revenue taxes due on such 
importations. The customs duties and internal revenue taxes due on such articles shall 
constitute a lien on the article itself, superior to all other charges or liens, irrespective of the 
possessors thereof. 
 
Any donation, contribution, bequest, subsidy, or financial aid which may be made to the 
Authority shall constitute an allowable deduction from the income of the donor for income 
tax purposes and shall be exempt from donor’s tax, subject to such conditions as provided 
under the National Internal Revenue Code, as amended. 
 
Small farmers and small farmers’ cacao cooperatives shall be exempt from all taxes on 
proceeds from the sale of raw cacao and chocolate products. 
 
Chocolate processors shall enjoy a presumptive input tax credit of four percent (4%) of the 
value of their gross purchases from small farmers and small farmers’ cacao cooperatives. 
 
SEC. 19. Credit Facilities. – The Bangko Sentral ng Pilipinas shall adopt monetary and re-
discounting policies designed to encourage rural banks, savings and loan associations, 
commercial banks, and other credit institutions to meet the financing and credit needs 
essential to achieve the objectives of this Act. 


  
 
In addition, the Philippine National Bank, the Land Bank of the Philippines, and the 
Development Bank of the Philippines shall design and establish special lending programs at 
affordable terms for small cacao farmers and cacao cooperatives. 
 
SEC. 20. Auditor. – The authority shall have an auditor and complementary personnel who 
shall be appointed by the Commission on Audit in accordance with the civil service law, rules, 
and regulations.  The salaries of the auditor and the audit staff shall be determined and paid 
by the Commission on Audit. 
 
SEC. 21. Penalty Clause. – Any person or entity found guilty of violating any provision of this 
Act, shall be sentenced to imprisonment of not more than six (6) months or a fine of not more 
than twenty thousand pesos (Php 20,000.00) or both upon the discretion of the Court. 
 
SEC. 22. Promulgation of Rules and Regulations. – The Department of Agriculture, in 
coordination with the member agencies and the private sector representatives of the Cacao 
Industry Board shall prepare and issue the rules and regulations implementing this Act within 
six (6) months from the date of its effectivity. 
 
In addition, the Secretary of the Department of Agriculture (DA) shall report to both Houses 
of Congress on the status of the promulgation of the rules and regulations within ninety (90) 
days from the date of the effectivity of this Act. 
 
SEC. 23. Appropriations. – The appropriations of agencies, divisions, councils, and 
corporations, merged, abolished, or transferred pursuant to this Act shall be turned over to 
the Authority. Thereafter, such sums as may be necessary for its continued operation and 
maintenance shall be included in the annual General Appropriations Act. 
 
SEC. 24. Repealing Clause. – All laws, decrees, executive orders, rules, and regulations or parts 
thereof which are inconsistent with this Act are hereby repealed or modified accordingly. 
 
SEC. 25. Separability Clause. – If any provision of this Act is declared unconstitutional or 
invalid, other provisions thereof which are not affected thereby shall continue in full force 
and effect. 
 
SEC. 26. Effectivity. — This Act shall take effect fifteen (15) days following its publication in 
the Official Gazette or any newspaper of general circulation. 
 
Approved,