TWENTIETH CONGRESS OF THE 
) 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
) 
HOUSE OF REPRESENTATIVES 
HOUSE BILL No. 679
Introduced by REPRESENTATIVES LANI MERCADO-REVILLA, 
BRYAN B. REVILLA AND RAMON JOLO B. REVILLA III 
AN ACT 
ESTABLISHING THE NATIONAL FRAMEWORK FOR WATER 
RESOURCE MANAGEMENT AND CREATING THE DEPARTMENT OF 
WATER RESOURCES AND THE WATER REGULATORY 
COMMISSION, DEFINING THEIR MANDATE, POWERS AND 
FUNCTIONS, APPROPRIATING FUNDS THEREFOR, AND FOR 
OTHER PURPOSES 
EXPLANATORY NOTE 
Being an archipelago, the Philippines is surrounded by bodies of water and 
frequented by rains, thus a water rich country. The Philippines has total annual 
renewable water resources of 479 billion cubic meters (m3). This Is equivalent to an 
annual per capacity availability of 6,100 m3, which is twice that of the rest of Asia 
and six (6) times the global scarcity threshold of 1,000 m3. 
However, many Filipinos experience deprivation of affordable, safe drinking 
water and a working sanitation system despite of our abundant freshwater sources. 
The Department of Environment and Natural Resources once stated that the 
government "...still scrambles to avert a water crisis during the summer season or 
when the country experiences the El Nino phenomenon." This was seen during the 
water crisis of March 2018, which caused shortages throughout the east zone of 
Metro Manila, and in March 2019, which cut off the water supply for about 
ten thousand households across Metro Manila. 
The Philippines also lacks a strong liquid In-liquid out system. This means that 
even if households are serviced with clean drinking water, a minute number receive 
adequate sanitation and sewerage services. This leads to severe cases of 
leptospirosis, dengue, typhoid, and related tropical and water-borne illnesses. About 
31% of illnesses in the country are water-related due to a lack of clean drinking water 
supply and efficient sanitary facilities. This perennial problem has seriously affected 
the lives of our citizens in terms of health, sanitation, food security, and livelihood, in 
addition to negatively impacting the environment. This particularly impacts the poor, 
who not only have the worst access to water but are also usually compelled to pay 
more for it. 
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July 1, 2025
8:00 am


The lack of sufficient, safe, acceptable, accessible, affordable drinking water 
and sanitation is not unique to the Philippines. However, as the World Water Council 
has repeatedly stated. It is Incumbent on each country to push for strong standards 
within its government and contribute to global governance on the issues of water 
and sanitation.  
There are many water-related laws in the Philippines. However, their 
enforcement Is weak and the water sector is beset with problems including poor 
database and weak cooperation among water agencies, regulatory bodies and local 
government units (LGUs). There are currently four (4) major economic regulatory 
agencies for water: the National Water Resources Board (NWRB), the Local Water 
Utilities Administration (LWUA), LGUs, and national agencies which include Industrial 
Zones and the Metropolitan Waterworks and Sewerage System (MWSS). The 
regulatory framework for water has many overlaps, and economic regulations are 
provided under a number of different arrangements which result in the framework's 
instability and fragmentation. Such fragmentation has had significant Implications in 
the effective and adequate delivery of water and sanitation services in the country. 
Because there is no lead agency in the water resource sector, the different 
coordination systems, functions and jurisdictions of the various agencies have made 
it impossibly hard for water and sanitation to be collectively managed. Thus, the 
establishment of a unified agency that would focus on water, sewerage and 
sanitation is certainly very important. 
This bill seeks to rationalize the economic as well as administrative regulation 
of water utilities through an independent, quasi-judicial body called the Water 
Regulatory Commission. Among Its functions are to set the policy for water supply, 
sewerage and septage management; issue licenses; set, review and approve rates; 
review and suspend contracts; initiate investigations on erring officials through its 
quasl-judiclal nature; review and revoke issuances, memoranda and the like, that are 
not in accordance with the spirit of the Commission, and ensure that the welfare of 
consumers are prioritized. 
Similarly, the bill creates a new government agency called, the Department of 
Water Resources which shall be the primary policy, planning, coordinating, 
implementing, monitoring, and administrative entity of the executive branch of the 
government. It shall also be responsible for the comprehensive and integrated 
development and management of the water resources of the Philippines, and their 
optimal allocation among competing uses, towards achieving universal access to 
safe, adequate, and affordable water supply, sanitation, and septage services. 
To live In a community that is clean, free from human waste, and abundant with 
safe and affordable drinking water is an utmost human right, so much so that the 
United Nations General Assembly explicitly recognized the Right to Water and 
Sanitation through UN Resolution 64/292 in 2010.  
To ensure Filipinos reap the benefit of this most fundamental human right, the 
urgent approval of this bill is earnestly sought.
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This bill was approved by the House of Representatives on the 19th 
Congress, adopting the approved Senate version. 
REP. LANI MERCADO - REVILLA, MSLG, DM (hc)
Representative
2nd District of Cavite 
REP. BRYAN B. REVILLA
REP. RAMON JOLO REVILLA III
Representative
Representative
AGIMAT Partylist
1st District of Cavite
3


TWENTIETH CONGRESS OF THE 
) 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
) 
HOUSE OF REPRESENTATIVES 
HOUSE BILL No. 679
Introduced by REPRESENTATIVES LANI MERCADO-REVILLA, 
BRYAN B. REVILLA AND RAMON JOLO B. REVILLA III 
AN ACT 
ESTABLISHING THE NATIONAL FRAMEWORK FOR WATER 
RESOURCE MANAGEMENT AND CREATING THE DEPARTMENT OF 
WATER RESOURCES AND THE WATER REGULATORY 
COMMISSION, DEFINING THEIR MANDATE, POWERS AND 
FUNCTIONS, APPROPRIATING FUNDS THEREFOR, AND FOR 
OTHER PURPOSES 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled: 
CHAPTER I 
GENERAL PROVISIONS 
Section 1. Short Title.- This Act shall be known as the "National Water 
Resources Management Act" 
Sec. 2. Declaration of Policy.- 
(a) The State recognizes that water is fundamental to individual life, health, and
dignity, and that every person has a right to access safe and clean water for
personal and domestic use;
(b) The State affirms that the right of all Filipinos to safe and clean drinking
water and sanitation is essential to the full enjoyment of life and all human
rights and hence, the attainment of a nationwide water supply, sanitation, and
sewerage services at reasonable rates must be pursued in an orderly,
rational, efficient, and dynamic manner;
(c) The State emphasizes that water is a public good subject to diverse use in
economic, agricultural, and industrial activities, and is thus a scarce resource
which must be carefully regulated to prevent resource depletion and to
ensure its availability for future generations;
(d) The State also maintains that water is indispensable to the existence and 
4


sustainability of natural ecosystems, and as such its use must neither endanger 
the balance and health of the environment nor compromise the rhythm and 
harmony of nature; 
(e) The State further maintains that water resources are interconnected with 
climate, soil condition, land use and land cover, forest cover, and other natural 
resources. As such, the management of water will require inter-sectoral and 
inter-agency collaboration as well as harmonization of laws, policies, 
institutions, and stakeholders; and 
(f)
Finally, while the State maintains that all water resources remain under its full 
ownership, control, and supervision, it emphasizes that it may enter into 
arrangements with the private sector, as well as with civil society and 
community-based organizations, on the basis of beneficial use, to ensure the 
efficient and affordable delivery of water supply, sanitation, and septage 
services to end-users.  
 
In accordance with these precepts, it is hereby declared the policy of the State 
to provide for the rational, evidence-based, and integrated management of all water 
resources in the country to ensure universal access to safe, adequate, and affordable 
water supply, sanitation, and septage services, through a policy and regulatory regime 
that encourages innovation and responsible private sector participation, while 
ensuring ecological preservation and environmental sustainability. 
 
Sec. 3. Definition of Terms.-The following terms are hereby defined as follows: 
(a) Bulk water supplier refers to any entity, natural or juridical, whether public or 
private, supplying or intending to supply large quantities of raw or treated 
water to buyers who will use it for own consumption, such as industrial 
companies, or for retail distribution to consumers such as water service 
providers or real estate developers managing their own distribution network; 
(b) Environmental services refer to qualitative functions of natural non-produced 
assets of land, water, and air, including related ecosystems, and their 
biota, and which may be categorized into three basic types: (i) disposal 
services which reflect the functions of the natural environment as an 
absorptive sink for residuals; (ii) productive services which reflect the 
economic functions of providing natural resource inputs and space for 
production and consumption, and (iii) consumer or consumption services 
which provide for physiological as well as recreational and related needs of 
human beings; 
(c) Flood Control refers to methods, acts, and protocols to be observed in order 
to prevent and reduce the detrimental and catastrophic effects of flood 
waters which include sediment-laden or turbid flows, and hyper-concentrated 
flows or debris flows; 
(d) Flood Risk Management (FRM) refers to such acts of defining and 
determining the appropriate methods, acts and protocols aimed at preventing 
and reducing the risk of incurring loss of both life and property due to flood 
5


waters. Flood risk management consists of a cycle of prevention, 
mitigation, adaptation, preparedness, and early warning, and, response 
and recovery. The elements of FRM include: integrating land-use planning 
and coastal zone management into water management; adopting a holistic 
approach so that FRM is part of wider risk or multi-hazard management of 
earthquakes, landslides, and storm surges; managing risk and uncertainty as 
a whole so it is not only hydrological uncertainties but also social, economic, 
and political uncertainties on account of human behavior and cultural 
dimensions of FRM; 
(e) Infrastructure and public works refer only to wholly or primarily water-related 
projects and shall not incorporate projects that do not otherwise fall within the 
purview of the objectives, powers, and duties of the Department of Water 
Resources created under this Act; 
(f)
Integrated Water Resource Management (IWRM) refers to a systematic, 
collaborative and multi-stakeholder process which promotes the coordinated 
development and management of water, land, and related resources within 
geophysical boundaries in order to maximize the resultant economic and 
social welfare in an equitable manner and without compromising the 
sustainability of vital ecosystems; 
(g) License refers to the Water Supply or Sanitation Services Operating 
License that the Water Regulatory Commission is authorized to grant and 
issue to Service Providers; 
(h) Licensee refers to the Service Provider to whom a License is granted or 
issued by the Water Regulatory Commission; 
(i)
Missionary Water refers to water supply or services to areas that have 
no existing safe water supply and services due to geographic limitation or 
absence of economic and market viability; 
(j)
National Water Resources Management Plan (NWRMP) refers to a 
policy document that incorporates a framework to guide the development 
and management of all water resources in the Philippines, the general 
strategies and work to be pursued to ensure the sustainability of the 
resource and work towards the water security; and provides top-level 
direction on the utilization of existing water resources in line with national 
development plans, policies, and programs in accordance with the IWRM 
framework. The NWRMP shall also include a water infrastructure 
development program for all waters of the country as well as provide 
general guidance on how this shall be supported within an integrated 
financing framework that can draw on public, private and international 
development funding sources; 
(k) Regulatory Units refer to the regulatory offices of the Water Regulatory 
Commission established under this Act; 
(l)
River basin refers to an area of land drained by a stream or body of fixed 
water and its tributaries which have a common outlet for surface run-off; 
(m) River Basin Organization (RBO) refers to multi-stakeholder organizations 
6


which plan, coordinate, and monitor activities within a river basin cluster; 
(n) Sanitation refers to the provision of facilities and services for the safe 
management of septage and sewage, from the collection to containment, 
and storage and treatment onsite or conveyance, treatment, and eventual 
safe end use or disposal, and includes the safe management of solid waste 
and animal waste; 
(o) Septage refers to the liquid and solid material pumped from a septic 
tank, cesspool, or other primary treatment source. 
(p) Septage Management refers to the provision of proper collection, 
treatment, and disposal of septage; 
(q) Service Area refers to the area covered by the water distribution
system, sewerage, and septage management services; 
(r)
Service Provider- refers to any entity, natural or juridical, whether private 
or public, providing or intending to provide water supply, including bulk 
water suppliers, sewerage, septage treatment, and disposal services for 
domestic, residential, institutional, industrial, or commercial use; 
(s) Sewage refers to water-borne human or animal wastes, excluding oil or 
oil waste, removed from residences, buildings, institutions, and industrial 
and commercial establishments together with such groundwater, surface 
water and storm water as may be present including such waste from 
vessels, offshore structures, other receptacles intended to receive or retain 
waste or other places or the combination thereof; 
(t)
Sewerage refers to any system or network of sanitary pipelines, ditches,
channels or conduits including pumping stations, lift stations and force 
mains, service connections including other infrastructure, devices or 
appliances appurtenant thereto, which includes the collection, transport, 
pumping and treatment of sewage to a point of disposal; 
(u) Sewers refer to pipes or such other works or structures which are built 
and constructed to carry, transport, and dispose sewage; 
(v) Tariffs refer to such amounts which may be charged by licensees for their 
water supply, sewerage, or sanitation services based on principles, 
standards, and guidelines established by the Water Regulatory Commission; 
(w) Water Demand Management refers to any method whether technical, 
economic, administrative, financial, or social that will accomplish one or more 
of the following: 
(i)
Reduce the quantity or quality of water required to accomplish a 
specific task; 
(ii)
Adjust the nature of the task or the way it is undertaken so that it 
can be accomplished with less water or with lower quality water; 
(iii)
Reduce the loss in quantity or quality of water as it flows from 
source, through use, to disposal; 
7


(iv)
Shift the timing of use from peak to off-peak periods; and
(v)
Increase the ability of the water system to continue to serve
society during times when water is in short supply.
(x) Water District refers to government-owned and controlled corporations
organized  under  Presidential  Decree  No. 198, otherwise known as the
"Provincial Water Utilities Act of 1973", as amended, created primarily to 
acquire, install, operate, maintain and improve water supply and distribution
systems for domestic, industrial, and municipal uses of residents and to
provide, maintain, and operate wastewater collection, treatment and disposal
facilities within the boundaries of the district;
(y) Water pollution refers to any alteration of the physical, chemical, biological, or
radiological properties of a body of water resulting in the impairment of its
purity or quality;
(z) Water Resource refers to water under the ground or groundwater; water
above the ground such as surface water, run-offs, floods, stormwater and
urban drainage; treated wastewater, water in the atmosphere or rain water;
and the waters of the sea within the territorial jurisdiction of the Philippines;
(aa)Water resource allocation refers to the process of sharing the limited water 
resources between competing users. This consists of determining water 
availability and determining how the water should be shared among competing 
users. For the purpose of this Act, resource allocation shall also mean 
water resource allocation; 
(bb)Water Resources Regions refer to the contiguous clusters of river basins 
created under this Act for administrative purposes under the Department 
of Water Resources; 
(cc) Water Resources Regional Offices (WRROs) refer to the field offices of 
the Department of Water Resources, as created under this Act, which are
to be established in accordance with the identified water resources regions
in the country;
(dd)Water service cooperative refer to cooperatives organized primarily to
own, operate, and manage water systems 'for the provision and
distribution of potable water for the members and their households
(ee)Water Service Providers (WSPs) refer to the water districts, any Local 
Government Unit (LGU)-run water utility, Barangay Waterworks and Sanitation 
Association, Rural Waterworks and S, and private sector entities that 
provide water supply services to any given area; 
(ff) Water supply service refers to any activity comprising developed water 
sources, communal faucet system or stand posts, waterworks system or 
individual house connections, which include bulk suppliers, suppliers to 
subdivisions, or other similar water service providers. 
8


CHAPTER II 
DEPARTMENT OF WATER RESOURCES 
 
Sec. 4. Establishment of the Department of Water Resources. - There is 
hereby established the Department of Water Resources, hereafter referred to as 
the Department. 
 
Sec. 5. Mandate and Objectives. - The Department shall be the primary 
policy, planning, coordinating, implementing, monitoring, and administrative entity 
of the Executive Branch of the government responsible for the comprehensive, 
sustainable, climate-resilient, and integrated development and management of the 
water resources of the Philippines, and their optimal allocation and use for 
domestic and municipal water supply, sanitation, irrigation, hydropower, industry, 
navigation, flood management, and recreation, and water utilization aspects of 
fisheries or aquaculture. 
 
The Department shall also be the primary agency responsible for the planning 
and policy formulation towards the attainment of universal access to safe, adequate, 
affordable, and sustainable water supply, and improved sewerage and sanitation 
services for all Filipinos. 
 
Sec. 6. Powers and Functions. - The Department shall exercise the 
following powers and functions: 
I.
Policy Making And Planning 
(a) Ensure that Integrated Water Resources Management (IWRM) is 
adopted as 
the 
strategic 
framework 
f o r 
w a t e r 
management policymaking and planning in the country and 
coordinate the implementation, promotion, 
revision 
and 
enhancement of IWRM plans; 
(b) Formulate policies, strategies, and targets in coordination with other 
relevant agencies and stakeholders to meet the goals and 
objectives for water resource sustainability and protection, water 
allocation and management, water supply, sanitation, and sewerage, 
water quality, irrigation, hydropower, flood control, stormwater 
utilization, and urban drainage. Such policies shall, among other 
guidelines, integrate the relevant issues of water, sewerage, 
sanitation, food security, energy, environment, flood control, and 
climate change; 
(c) Formulate long-term policies to balance the sustainability and 
optimal multiple use of water resources, define the hydrologic 
boundaries of basins of the existing water supply sources, and 
develop or update existing River Basin Master or Comprehensive 
Plans which includes all aspects of water management and 
development such as water supply, sewerage, and sanitation, 
irrigation, flood control and storm water or urban drainage, drought 
9


risk management, water resource development systems and other
public  water  works projects, including phasing of implementation; 
(d) Harmonize all relevant national river basin policies and serve as 
the national policy coordination office for LGUs and relevant 
stakeholders in the development and sustainability of river and 
catchment basins; 
(e) Identify, based on the river basin master plans, priority projects for 
water infrastructure development per river basin, including water 
supply, sanitation, irrigation, hydropower, flood control and storm 
water or urban drainage, drought risk management, water resource 
development systems and other public works projects; 
(f) Evaluate and 
appraise 
all 
regional 
and 
i n t e r -
regional infrastructure water development plans and programs as 
to their feasibility and consistency with approved strategies and 
medium and long-term plans; 
(g) Formulate and develop policies and strategies to promote 
universal access to safe, adequate, affordable, and sustainable 
water supply, and improved sanitation services for all Filipinos; 
(h) Develop, 
in 
consultation 
with relevant 
agencies 
and 
stakeholders, the National Water Resources Management Plan 
(NWRMP) and ensure its integration into existing Comprehensive 
Land Use Plans and Provincial Development and Physical 
Framework Plans, within the context of a National Physical 
Framework Plan, to ensure the harmonization of planning of 
water, land, subsurface, and air resources,  submit  the NWRMP 
to the National  Economic  and Development Authority Board
(NEDA) for approval and eventual adoption, and regularly update 
the NWRMP, every five years or as deemed necessary by the 
Department, in order to ensure its relevance to the times; 
(i) Prepare, formulate, implement, and update a five (5) year plan of 
action for National and Regional Septage Management, which shall 
contain measures for the construction of wastewater treatment 
facilities and provision, installation, operation, maintenance and, 
where      practicable,     the 
integration of sewerage, septage 
management, storm water management and other sanitation 
facilities, in accordance with Republic Act No. 9275, otherwise 
known as the "Philippine Clean Water Act of 2004". Compliance 
with the mandate to implement septage management services 
and systems by any WSP pursuant to Republic Act No. 9275 
shall be reckoned within five (5) years from the date of 
promulgation or publication of the septage management plan 
formulated by the Department; 
(j) Review and provide oversight over all water-related development 
plans and programs of any agency or local government unit (LGU) 
within the context of the NWRMP and overall national plans and 
10


programs; 
(k) Assist and provide the NEDA with the required data and input from 
the water sector in the formulation of the country's short-term and 
long-term strategic development plans and actions, and recommend 
to the NEDA Board the adoption of general policies and 
guidelines for water resources development; 
(l) Strengthen and coordinate with relevant agencies on policy 
making and planning for flood management, integrated with 
stormwater or urban drainage and appropriate retention or retarding 
basins in order to harvest and reuse water, and to plan against, 
prevent, and minimize the detrimental and catastrophic effects of 
flooding; 
(m) Develop and implement, in coordination with other relevant 
agencies and stakeholders, effective codes, standards, 
benchmarks, and reasonable guidelines to ensure the safety of 
all public and private water structures in the country, and assure 
efficiency and proper quality in the construction 
o f 
w a t e r , 
sanitation, irrigation, hydropower, flood control and drainage 
infrastructure; and ensure that the planning and design of water 
infrastructure considers the highest efficiency and most appropriate 
technology and quality; 
(n) Ensure that gender equality, social inclusion, environmental 
protection, climate resiliency and disaster risk reduction, and 
indigenous knowledge systems and practices are integrated into 
any water resources management planning, policy making, and 
the design and construction of water infrastructure; 
(o) Act as the lead agency in ensuring the effective implementation of all 
laws and implementing rules and regulations on water resources;  
(p) Review all water laws and implementing rules and regulations 
and propose amendments thereof to Congress, and advise any 
agency on the implications of government actions, policies, and 
programs to water supply, sewerage, and sanitation; 
(q) Authorize its representatives or any deputized agent to enter any 
property of public dominion or any private land, building or enclave, 
whether inhabited or not, or authorize a representative thereof, for 
the purpose of conducting hydrological surveys and investigations, 
including assessing and evaluating the conditions of water facilities 
installed, and determining compliance with water laws and standards; 
and 
(r) Issue and promote rules and regulations as may be necessary 
to implement and enforce its powers and functions under this Act; 
II.
Data Collection and Evidence Gathering 
(a)
Establish, operate, and maintain a centralized water resources 
11


data center necessary for the scientific survey and appraisal 
of surface and ground water potentials of the country and 
determine the annual renewable water available per available 
water resources region; 
(b)
Effect inter-sectoral, inter-agency and inter-departmental 
coordination on all aspects of data gathering and data sharing 
for water resources development planning and compel 
submissions of   statistics and 
data 
on water management 
with the aim of operationalizing the IWRM framework; 
(c)
Undertake river basin survey, inventory, and appraisal of water 
and related resources, and develop comprehensive basin-
wide plans of storage, retardation, and control to maximize
conservation and multipurpose use of water in the basin in 
coordination with the river basin initiatives of relevant 
government entities; 
(d)
Collect, regularly update, monitor, and analyze water resources 
data including climatology, hydrologic, and other water-related 
data; 
(e)
Establish, in coordination with agencies that generate water-
related data, the guidelines, standards, methodologies, and 
protocols for data collection that will be officially recognized by 
the Department, and institute mechanisms for coordination with 
other agencies as regards their submission and certification of 
submitted water-related data to the Department 
(f)
Conduct continuing hydrological and hydrometeorological 
surveys and studies of the country's renewable water supply, 
and establish, operate, and maintain observation 
station 
networks; 
(g)
Conduct and promote special studies and research on water 
economics and other aspects of water resources development 
and management as may be needed to support the policy and 
plan proposals of the Department, such as, but not limited to, 
impacts of climate change, weather modification, flood 
monitoring and modeling, environmental quality, and 
desalination; 
(h)
Establish, operate, and maintain observation station networks 
and a centralized water resources data center for the scientific 
survey and appraisal of surface and groundwater potentials of 
the country, and determine the annual renewable water available 
per water resources region; 
(i)
Develop and continuously update a computerized decision 
support system that incorporates data management system 
relating to acquisition and database, model base in terms of 
physical design, planning and decision models, and user-friendly 
interface concerning graphical and visualization tools; and 
12


(j)
Promote Philippine participation in information sharing and 
education on best practices in support of international efforts to 
achieve universal access to safe water and improved sanitation 
and the integration of water, energy, food security and 
environment. 
III.
Water Resource Management and Allocation 
(a)
Formulate, issue, and enforce rules and regulations on the following: 
(i)
Abstraction, diversion, and development of the country's water 
resources, taking into consideration their equitable distribution 
among competing demands and determine the standards of 
beneficial and priority uses of water in times of crises and 
national emergencies; 
(ii)
Equitable and optimal allocation of the country's water 
resources for domestic and municipal water supply, irrigation, 
sanitation, 
irrigation, 
hydropower, navigation, 
fisheries, 
livestock raising, industrial, recreational, and other purposes; 
(iii)
Determination and granting of water rights, including adjudication 
in cases of conflicting uses, amending for this purpose, Act 
No. 2152, otherwise known as "The Irrigation Act", and other 
laws relating to the appropriation and utilization of surface 
and groundwater: Provided, That the grant and adjudication of 
conflicting water rights shall be exercised by the Water 
Resources Adjudication Board; 
(iv)
Such other coherent water protocols as may be necessary, 
including the operating rules of all existing and future water 
infrastructure, legal and technical mechanisms for intra 
sectoral transfers; 
(v)
Guidelines for the determination of costs and fees of all water 
rights, tariffs, permits, and licenses through a science-based 
method which will accurately reflect the current or future 
projected state of the water  resource  to 
be 
allocated: 
Provided, That the actual methodology for setting rates and 
tariffs shall be the exclusive power of the Water Regulatory 
Commission; Methods and standards for basic data collection 
and project identification, formulation  and planning,  and 
appropriate sanctions to be imposed for non-compliance; 
(vi)
Guidelines in the grant of areas for missionary water, such as, 
but not limited to, corresponding non-tax incentives and 
possible sources of funding and revenues; 
(vii)
Treatment and utilization, in 
coordination with relevant 
agencies, of flood control, rain-water run-off, stormwater, and 
urban drainage; 
13


(b)
Exercise original jurisdiction over all disputes relating to appropriation, 
utilization, exploitation, development, control, conservation and 
protection of all water resources, the adjudication of which shall be 
enforced by the Water Resources Adjudication Board; 
(c)
Impose fees or charges, as may be deemed necessary for water 
resources conservation and protection, in accordance with applicable 
rules and regulations on the imposition and increase of fees or 
charges, such as, but not limited to: 
(i)
Raw water price, which shall take into account, among others, the 
scarcity of water; and 
(ii)
Appropriate structures for payment of environmental services; 
(d)
Raise public awareness 
through information, education, and 
communications programs, and build capacities for informed participation 
in water resources management at the national and river-basin level. 
IV.
Administration and Management 
(a)
Develop guidelines, including rules of partnership   between and 
among    the Department, field offices of national government agencies, 
LGUs,   and 
other stakeholders, in water resource management, 
facilitate the establishment of multi-stakeholder river basin organizations 
(RBOs) per river basin, and strengthen and support existing RBOs 
and monitor their activities; 
(b)
Develop  materials  for  capacity building  and  training  on  RBO 
development and conduct training and workshops for prospective 
RBOs; 
(c)
Provide technical assistance to water  users  including  farmers, 
communities, and LGUs and other water service providers (WSP) 
whether directly or in coordination with other agencies on all aspects of 
integrated water resources management; 
(d)
Conduct a performance audit of all water-related agencies and 
institutions, including but not limited to the water districts, MWSS, 
MWSS-RO and its concessionaires, LGU-run utilities, Tourism 
Infrastructure and Enterprise Zone Authority, Philippine Economic Zone 
Authority, Bases Conversion and Development Authority, Subic Bay 
Metropolitan Authority, DILG, and NIA; 
(e)
Respond to consumer complaints, and ensure the adequate promotion 
of consumer interests; 
(f)
Deputize any official or agency of the government to assist in the 
performance of any of the powers and functions of the Department; 
(g)
Appoint, hire, and maintain adequate staff and personnel, advisers or
consultants with suitable qualifications and experience, 
a
s 
necessary, in accordance with relevant civil service laws, rules, and 
regulations. 
14


V.
Coordination 
(a)Coordinate and rationalize the efforts of relevant government 
agencies and instrumentalities to ensure a whole-of-government 
approach to attaining water security; 
(b)Coordinate and integrate water resources development activities of the 
country within the context of national plans and policies for social and 
economic development; 
(c)Coordinate with other government agencies, universities, academe, 
and private professional groups in all aspects of data gathering, the 
conduct of special studies and research on all related aspects of 
water resources management and development such as climate 
change, environmental quality, desalination, and the development of 
operating strategies, procedures, and protocols with accompanying 
computerized decision tools for major water facilities; 
(d)Coordinate with the concerned and relevant agencies engaged in 
flood control, flood risk management, and drought risk management; and; 
(e)Coordinate proactively with LGUs to ensure the integration of water 
resources development plans into their comprehensive land use 
plans, Comprehensive Development Plans, or Provincial Physical 
Framework and Development Plan. 
VI.
Other Functions 
(a)  Create, when necessary, water resource subsidiaries, instrumentalities, 
and entities to engage in water transmission, water distribution, waste 
water treatment and management, and sanitation in accordance with 
existing relevant laws, without prejudice to private entities capable of 
and willing to engage in the aforementioned activities through 
concession agreements, joint venture agreements, bulk water 
agreements, or service agreements or contracts. For this purpose, the 
Department shall ensure compliance with existing frameworks, rules, 
regulations and guidelines for private sector participation in water 
transmission, water distribution, waste water treatment and 
management, storm water management, and sanitation; 
(b) Enter into contracts, 
joint venture agreements, public-private 
partnerships, and memorandum of agreements or understanding, either 
domestic or foreign relating to investment and financing water related 
projects, under such terms and conditions as the Department may deem 
proper and reasonable subject to existing laws; 
(c) Review existing guidelines appropriate for private sector participation in 
the water sector and submit recommendations to the Public Private 
Partnership (PPP) Center and other concerned agencies to promote 
and enable more PPPs in the sector; and 
(d) Exercise such other powers and functions necessary or incidental to 
the effective administration and management of the country's water 
15


resources. 
           Sec. 7. Offices, Functions, and Personnel to be Completely Absorbed by the 
Department. - The following offices are hereby abolished, and their respective powers 
and functions, and the corresponding personnel, funds and appropriations, records, 
equipment, and property shall be absorbed by the Department: 
(a) National Water Resources Board, whose mandate, powers, and functions 
are provided in Presidential Decree No. 424 creating the National 
Water Resources Council, now NWRB, as amended: Provided, That 
its water utility regulation units and functions vested under 
Commonwealth Act No. 146, also known as the "Public Service Act", 
as amended, shall be absorbed by the Water Regulatory Commission 
created under this Act: Provided, further, That its resource allocation or 
regulation units vested under Presidential Decree No. 1067 shall be 
absorbed by the Department under the National Water Resources 
Adjudication Board and the Resource Allocation Office, also created 
under this Act; 
(b) Local Water Utilities Administration {LWUA) with its services, departments 
and divisions, whose mandate, powers and functions are provided for in 
Title III of Presidential Decree No. 198, as amended, otherwise known 
as the "Local Water Utilities Administration Law": Provided, That its 
economic regulatory functions over local water districts shall be fully 
absorbed by the Water Regulatory Commission created under this 
Act: Provided, further, That its function to provide technical assistance 
to local water service providers shall be absorbed by the Department 
under the Local Water Service Providers Bureau, also created under this 
Act; 
(c) River Basin Control Office (RBCO) of the DENR whose mandate, 
powers and functions are found in Executive Order No. 510, series of 
2006, and Executive Order No. 816, series of 2009, as amended: 
Provided, That the DENR shall continue to have primary authority 
and responsibility for protecting the environment and managing the 
country's watersheds and reforestation activities: Provided, further, 
That the targeting of priority watershed areas shall be coordinated with 
the Department; 
(d) Manila Bay Coordinating Office (MBCO) of the DENR which was 
strengthened by virtue of DENR Administrative Order 2011-01, to 
coordinate the efforts of the fourteen (14) national agencies covered by 
the Mandamus Order of the Supreme Court to rehabilitate Manila Bay; 
(e) Water Supply and Sanitation Unit of the Department of the Interior and 
Local Government; and 
(f)
Water Resource Management Office of the DENR whose mandate, 
powers, and functions are provided in Executive Order No. 22, series of 
2023. 
16


 
Sec. 8. Powers and Functions to be Transferred to the Department. – The 
powers and functions of the following agencies, bureaus, and units and the 
corresponding personnel, funds and appropriations, records, equipment, and property 
are also hereby transferred to the Department: 
(a)The powers and functions of the DPWH with regard to the planning, 
programming, administration, monitoring, and management of the 
National Sewerage and Septage Management Program (NSSMP); and 
(b)The following functions of the dissolved Pasig River Rehabilitation 
Commission and transferred to the Manila Bay Tasj Force per Executive 
No. 93, series of 2019: 
(i)
Updating and leading in the overall implementation of the 
Pasig River Rehabilitation Master Plan; and 
(ii)
Ensuring that the easements provided for in the Civil Code and 
other relevant laws are enforced, especially in all the esteros 
and waterways as well as abating the dumping of untreated 
wastewater and sewage into water systems, including all acts and 
omissions in violation of Presidential Decree No. 984, as 
amended, and other related laws. 
 
Sec. 9. Attached Agencies. - The Department shall exercise administrative 
supervision over the following agencies for purposes of policy and program 
coordination, monitoring, and evaluation: 
(a)
The Metropolitan Waterworks and Sewerage System (MWSS), 
whose mandate, powers, and functions are defined under Republic Act 
No. 6234, as amended entitled, "An Act Creating the Metropolitan 
Waterworks and Sewerage System and Dissolving the National 
Waterworks and Sewerage Authority, and For Other Purposes," shall 
be transferred from the DENR and attached to the Department: 
Provided, That the MWSS shall continue to facilitate the exercise by 
the concessionaires of their responsibility; carry out accounting and 
notification functions; monitor, report, and administer loans; perform 
related functions in connection with existing projects; manage, 
operate, and dispose its retained assets: Provided, further, That its 
regulatory arm, the MWSS-Regulatory Office, shall be fully absorbed 
by the Water Regulatory Commission created under this Act; 
(b)
The Laguna Lake Development Authority (LLDA), whose mandate, 
powers and functions are defined under Republic Act No. 4850 otherwise 
known as "An Act Creating the Laguna Lake Development Authority, 
Prescribing Its Powers, Functions and Duties, Providing Funds Therefor, 
and for Other Purposes", as amended, shall be transferred from 
DENR and attached to the Department: Provided, That the power to 
set rates and fees for the use of the lake waters and its tributaries for all 
beneficial purposes under Section 4-B of Republic Act No. 4850, 
and the corresponding personnel, funds and appropriations, records, 
equipment, and property thereof shall be transferred to the Water 
Regulatory Commission: Provided, further: That the rates fees set by 
the WRC shall no longer be subject to the approval of the President of 
17


the Philippines. The LLDA shall continue to serve as the lake 
management and development authority similar to a multi-stakeholder 
river basin organization and shall ensure the implementation of the 
Laguna Lake Master 
Plan which 
shall 
be 
updated 
by 
the 
Department to ensure alignment with the NWRMFP; 
(c)
The National Irrigation Administration (NIA), whose mandates, powers 
and functions are defined under Republic Act No. 3601, otherwise known 
as "An Act Granting the National Irrigation Administration", as amended, 
is hereby transferred to the Department; and 
(d)
Any 
other agency 
performing 
water resources management, 
conservation, and protection functions may be transferred to the 
Department as the President deems necessary. 
 
The Secretary shall be the ex-officio Chairperson of the Governing Boards of 
the aforementioned government-owned and controlled corporations to be attached 
under the Department. In case existing laws, rules and regulations provide for a 
specific process in appointing the agency's Chairperson, the Secretary of Water 
Resources shall serve as Co-Chairperson. 
 
Sec. 10. Organization. -The Department shall be composed of the Office of the 
Secretary, and the various bureaus and services, and regional offices. The Office of 
the Secretary shall house the Office of the Department Secretary, the Office of the 
Undersecretaries, the Office of the Assistant Secretaries, and their immediate support 
staff. 
 
 
 
Sec. 11. Secretary of the Department of Water Resources. - The authority and 
responsibility for the exercise of the mandate of the Department and for the discharge 
of its powers and functions shall be vested in the Secretary of the Department, 
hereinafter referred to as the Secretary, who shall be appointed by the President, 
subject to confirmation by the Commission on Appointments. The Secretary shall: 
(a)
Provide executive direction, supervision, and control over the entire 
operations of the Department and exercise supervision over its attached 
agency for program and policy coordination; 
(b)
Advise the President on the promulgation of executive or administrative 
orders, and other issuances and on the formulation of necessary 
regulatory or legislative proposals on matters pertaining to the 
management of water resources, water supply, sanitation, and septage 
services; 
(c)
Establish the policies and standards for the effective, efficient, and 
economical operation of the Department pursuant to the President's 
guidelines; 
(d)
Advise the President on the status of water management and supply, 
recommend to the President the declaration of a state calamity in areas 
affected by water supply, and submit proposals to restore normalcy in the 
affected areas; 
18


(e)
Promulgate rules and regulations necessary to carry out the objectives, 
policies and functions of the Department; 
(f)
Designate and appoint officers and employees of the Department, 
excluding the Undersecretaries, Assistant Secretaries, and Regional and 
Assistant Regional Directors, in accordance with the civil service laws, rules 
and regulations;    
(g)
Exercise control, supervision, and disciplinary powers, in accordance with 
law, over all officers and employees of the Department, including their 
investigation and the designation of a committee or officer to conduct such 
investigation, in accordance with the civil service laws, rules and regulations; 
(h)
Create regional offices and such other services units, bureaus, and divisions 
as may be necessary; 
(i)
Call upon and deputize any official, agent, employee, agency, or 
instrumentality of the national and local government for any assistance that it 
may deem necessary to carry out the purposes of this Chapter, subject to 
existing laws; 
(j)
Delegate authority for the performance of any power or function, as defined 
herein to officials and employees under his direction as deemed appropriate, 
in accordance with existing laws; 
(k)
Act as the ex-officio Chairperson of the governing board of the agencies 
attached to the Department; and 
(l)
Perform such other duties and responsibilities as may be provided by law. 
 
Sec. 12. The Offices of the Secretary and Undersecretaries. -The Office of the 
Secretary shall be composed of the Secretary and immediate staff. The Secretary 
shall be assisted by not more than three (3) Undersecretaries and three (3) 
Assistant Secretaries, who shall all be appointed by the President upon the 
recommendation of the Secretary. 
 
The Secretary is hereby authorized to delineate and assign the respective 
functional areas of responsibility of the Undersecretaries and Assistant Secretaries: 
Provided, That such responsibility shall be with respect to the mandate and objectives 
of the Department: Provided further, That no Undersecretary shall be assigned 
primarily to administrative responsibilities. 
 
Sec. 13. Qualifications of the Department Secretary, Undersecretaries, and 
Assistant Secretaries. – 
(a) No person shall be appointed Secretary, Undersecretary, or Assistant 
Secretary unless he or she is of good moral character, of proven integrity and 
competence in public administration, and has a minimum of seven (7) years of 
experience in the administration of water, sewerage, sanitation, irrigation, 
flood control, or drainage programs, preferably in a public agency; 
(b) At least one (1) of the Undersecretaries and at least one (1) of the 
Assistant Secretaries shall be career officers; 
19


(c) No officer, external auditor, accountant, or legal counsel of any private 
company or enterprises primarily engaged in the water industry shall be 
eligible for appointment as Secretary within two (2) years from retirement, 
resignation, or separation therefrom. 
 
Sec. 14. The Water Resources Adjudication Board. - There is hereby 
created a Water Resources Adjudication Board, hereafter referred to as the Board, 
under the Office of the Secretary. The water resources allocation and regulation 
functions of the National Water Resources Board are hereby transferred to the 
Board which shall supervise the effective appropriation and regulation of the water 
resources in the country in accordance with Presidential Decree No. 1067. The 
Board shall exercise quasi-judicial powers granted to it under this Act. 
 
Sec. 15. Composition. - The Board shall be composed of a Department 
Undersecretary as Chairperson and three (3) representatives from stakeholders as 
members, who shall all be designated by the Secretary. 
 
There is hereby created a Resource Allocation Office, hereinafter referred to as 
the Office, which shall serve as Secretariat to the Board and shall exercise the 
following functions in order to provide technical support to the Board towards the 
effective regulation of the country's water resources. 
 
Sec. 16. Functions of the Board. -  The Board shall perform the 
following functions: 
(a) Promulgate rules and regulations for the exploitation and optimum 
utilization of water resources, in accordance with Presidential Decree 
No.1067 and other existing laws, including the imposition on water 
appropriators of such fees or charges by the Department; 
(b) Approve the guidelines and processes pertaining to water regulation, as 
recommended by the Research All; 
(c) Review and decide on requests for permits to extract or utilize the country's 
water resources and grant the corresponding water rights, upon 
recommendation of the Office in accordance with Presidential Decree No. 
1067: Provided, That the water rights are exercised within five (5) years of 
granting of such rights: Provided, further, That applicants for water permits 
shall submit proof of land ownership of, or right to use the property where the 
water source is located: Provided, final!Y, That, if the applicant is currently 
using the water source being applied for domestic or municipal purposes 
upon the effectivity of this Act, such applicant may submit such proof of prior 
use of possession of said property in lieu of ownership or right to use; 
(d) Exercise original jurisdiction over decisions in cases involving the following: 
(i)
All disputes relating to the appropriation, utilization, exploitation, 
development, control, conservation, and protection of waters; 
20


(ii)
Violations and disputes on raw water fees; and 
(iii)
Violations and disputes involving water permits, administrative 
allocation of water resources, and transfer of water rights; 
(e) Issue subpoena duces tecum and subpoena ad testificandum; 
(f) Cite any person or party in contempt for refusal to appear, testify or comply 
with the lawful orders of the Board in relation to any matter subject to its 
investigation; 
(g) Hear, receive evidence, and decide on cases falling within its jurisdiction; 
(h) Impose the appropriate sanctions, including revocation of water permits, 
over violations committed by appropriators after due notice and hearing 
in accordance with Presidential Decree No. 1067 and other existing laws, 
rules and regulations as well as future rules and regulations which the 
Board shall promulgate; 
(i) Review, update, and revise all fees, charges, and penalties imposed on all 
water appropriators as stated under Chapter VII and VIII of Presidential 
Decree No. 1067, upon recommendation by the Secretariat, and based on 
scientific and evidence-based studies; 
(j) Promulgate its own rules and procedures; and 
(k) Exercise such other powers as may be necessary to carry out its duties 
and responsibilities under this law. 
 
Sec. 17. Resource Allocation Office. - The Office shall perform the following 
functions: 
(a) Advise the Board on all matters relating to resource allocation and 
regulations; 
(b) Formulate rules and regulation for the exploitation and optimum utilization of 
surface water, groundwater, and seawater extraction and use, for the 
approval of the Board, and for implementation by the Resource Allocation 
Office, including the processes for the application of water permits, in 
accordance with Presidential Decree No. 1067 and other existing laws; 
(c) Process applications of rights to utilize water resources for the appropriate, 
optimal and sustainable use of surface and ground water, for the approval of 
the Board or its Executive Director, as may be delegated by the Board; 
(d) Upon approval by the Board, issue water permits granted to water 
appropriators; 
(e) Monitor performance and conduct audits on water rights grantees 
including, among others, review of compliance by grantees with the terms of 
the permits granted; 
(f) Investigate, motu proprio or upon complaint, violations of the water rights and 
Presidential Decree No. 1067; 
21


(g) In the case of violations and conflicts between and among users, file the 
necessary cases for the decision of the Board;  
(h) Enforce the decisions promulgated by the Board, and as may be delegated 
by the Board; 
(i) Coordinate with other relevant units of the Department regarding the 
generation, updating, managing, and sharing of water data; 
(j) Respond to consumer complaints, and ensure the adequate promotion of 
consumer interests; and 
(k) Perform such other related functions and activities which are necessary for 
the effective regulation of water-related services. 
 
The Office shall be headed by an Executive Director and shall be assisted by 
one (1) Deputy Executive Director. 
 
Sec. 18. Orders and Decisions. -Every order or decision rendered by the Board 
shall be in writing and shall state clearly and distinctly the facts and the law on which 
it is based. The Board shall decide each case or application within thirty (30) days 
following its formal submission for resolution. All decisions and final orders in the 
adjudication of contested cases or applications shall be published and made available 
for public inspection. 
 
Sec. 19. Appeals Procedure and Prohibition Against Injunction. - 
(a)The orders, rulings, and decisions of the Board shall become final and 
executory after fifteen (15) days from receipt of such order, ruling, or 
decision, unless, prior to the lapse of this period, an appeal was made with the 
Secretary of Water Resources; 
(b)All decisions where the penalty imposed is a fine shall be immediately 
executory, except upon the filing of a bond equivalent to the fine imposed or as 
may be fixed by the Board; 
(c)Except for the Supreme Court, no temporary restraining order, preliminary 
injunction, or preliminary mandatory injunction may be issued by any court 
to restrain any proceeding before, or the implementation or execution of 
any order, ruling, or decision of the Board. 
 
Sec. 20. Bureaus and Services. - The Department shall establish, operate, and 
maintain the Bureaus and Services under it such as, but not limited to: 
(a)The  Local 
Water Service Providers Bureau shall provide 
technical 
assistance and personnel training for the creation, application for the 
socialized credit program, and operation of local water service providers, and 
shall effect system integration, joint investment and operation, district 
annexation and de-annexation, whenever economically warranted, in 
accordance with Section 50 of Presidential Decree No. 198, as amended by 
Section 22 of Presidential Decree No. 768; 
22


(b)The Bureau of Flood Control and Drainage shall plan and design, in 
coordination with the DPWH and other relevant government agencies, 
flood control and drainage structures and facilities in accordance with 
technical standards, guidelines and 
manuals, and provide technical 
assistance to other agencies, LGUs, and other stakeholders; 
(c)The Planning and Policy Service shall formulate strategies and priorities for 
water resources management and provide the Department with the 
capability to undertake water infrastructure development planning and 
programming; 
(d)The Data Management Service shall develop, manage and maintain the 
management information 
system and knowledge 
s y s t e m s 
o f 
t h e 
Department, including the processing of water-related data; 
(e)The Administrative and Human Resource Service shall provide 
the 
Department with services relating to human resources development, 
personnel, records, facilities maintenance, medical and dental, security and 
property and procurement services, in accordance with civil service laws, 
rules, and regulations; 
(f) The Legal and Legislative Service shall provide the Department with 
services on legal affairs such as, but not limited to, contract preparation and 
review, legal and legislative research, complaints and investigation on 
employees, legal counselling and other matters of law; 
(g)The Comptrollership and Financial Management Service shall provide the 
Department with coordinated services relating to financial systems and 
procedures, budget, cash, accounting and all financial housekeeping 
matters; 
(h)Internal Audit Service shall regularly conduct a comprehensive audit of 
various Department activities; 
(i) The Public Affairs Service shall enhance government relations with all 
stakeholders including the media and shall ensure that stakeholders and 
marginalized sectors shall be consulted and can take active part in all 
aspects of water resources development and management activities. 
 
The Bureaus and Services of the Department shall be headed by a Director 
who shall be responsible for efficiently and effectively carrying out the functions of 
the Bureau concerned. Each Director shall be assisted by one (1) Assistant Director. 
 
Sec. 21. The Water Resources Regional Offices. - Water Resources Regional 
Offices, herein after referred to as the Regional Offices, shall be organized per water 
resources region and shall be responsible for implementing the mandates, powers, 
and duties of the Department at the field level, except for policymaking which will be 
vested solely in the Department. 
  
The Department shall establish the water resources regions which shall be 
grouped together according to the hydrological boundaries, physiographic features, 
and homogeneity in climate, whether or not they straddle different LGUs. 
23


  
The Regional Offices shall have, within their respective water resources region, 
the following functions: 
(a) Formulate or update and coordinate the river basin master plans for river basins 
within its jurisdictions consistent with the NWRMP; 
(b) Advocate and strongly support the creation and functioning of multi-
stakeholder River Basin Organizations (RBOs) and serve as the secretariat of 
the said RBOs; 
(c) Undertake and evaluate the planning, design, and work supervision 
functions of the Department for the water infrastructures within the region, 
and recommend the necessary water infrastructures therein; 
(d) Ensure the implementation of laws, policies, programs, rules, and 
regulations regarding the abovementioned infrastructure as well as public and 
private physical structures; 
(e) Provide technical assistance related to the water-related functions of other 
agencies within the region, especially the local government; 
(f) Coordinate with other departments, LGUs, agencies, institutions and 
organizations within the region in the planning and implementation of the river 
basin master plans; 
(g) Conduct continuing consultations with the local communities, take 
appropriate measures to make the services of the Department responsive to the 
Central Office, and recommend such appropriate actions as may be 
necessary; and 
(h) Perform such functions and activities, as may be mandated by law, which are 
necessary for the effective performance of the abovementioned objectives. 
  
Each regional office shall be headed by a Regional Director who shall be 
responsible for efficiently and effectively carrying out the duties and responsibilities of 
the office. The Regional Director shall be assisted by one (1) Assistant Regional 
Director. The Regional Directors and Assistant Regional Directors shall be appointed 
by the President. 
 
The Department shall retain existing Project Management Offices as may be 
required, which shall be under the supervision and control of the appropriate Regional 
Director, unless otherwise determined by the Secretary for reasons of supra-regional 
scope, magnitude, and multi-functional coverage. 
 
Sec. 22. Structure and Staffing Pattern. - Subject to the approval of the 
Department of Budget and Management (DBM), the Secretary shall determine the 
organizational structure and create new divisions or units as may be necessary, and 
appoint officers and employees of the Department in accordance with the civil service 
laws, rules and regulations. The remuneration structure of the position in the staffing 
pattern shall strictly conform to Republic Act No. 11466, otherwise known as the 
"Salary Standardization Law of 2019", as amended. 
24


CHAPTER Ill 
SOCIALIZED CREDIT FOR LOCAL WATER SERVICE PROVIDERS 
 
Sec. 23. Socialized Credit Program. -Socialized credit shall be made 
available, through the Land Bank of the Philippines (LBP), for capital expenditures 
necessary for the maintenance, addition, expansion, or improvement of the services 
of the water service providers, such as but not limited to, capital expenditure for water 
distribution, water conservation, water treatment, water sanitation, water testing, 
and other related activities and ancillary services: Provided, That the loans shall be 
available to water service providers duly registered with the Department: Provided, 
further, That no loan shall be granted for the purpose of funding operational costs or 
expenses. 
 
Sec. 24. Committee on the Socialized Credit Program. - The Committee on 
the Socialized Credit Program (SCP), hereinafter referred to as the Committee, is 
hereby created. The Committee shall be composed of a representative of LBP as 
Chairperson and a representative of the Department as Vice-Chairperson, both of 
which should hold at least a director position, and four (4) additional members which 
shall be equally shared between the Department and LBP, who shall possess the 
necessary training and experience necessary for the Committee. The Committee 
shall directly report to the Secretary of the Department. 
 
The Committee shall exercise the following functions: 
(a) Recommend the lending policies such as, but not limited to, the criteria of 
eligible borrowers, eligible loan purpose, interest rate, fees and charges, 
collateral, guarantee, insurance, and other forms of security, and other 
terms and conditions of the credit facility; 
(b) Review the policies, and procedures, and formulate policies for the SCP; 
(c)
Monitor the process and performance of the SCP; 
(d) Monitor the fund disbursements; 
(e) Act on issues or concerns relative to the implementation of SCP; 
(f)
Conduct SCP performance evaluation; and 
(g) Exchange credit information 
with LBP, LWUA, and other relevant 
agencies. 
    The SCP shall prioritize the following target beneficiaries: 
(a) Water Districts and LGU-run utilities in the Missionary Water Area; 
(b) Water Districts with low credit rating; and 
(c) Other priority Water Districts or eligible projects of the Water District to be 
identified by the Committee. 
 
Generally, local water service providers with existing Public-Private Partnership 
25


Projects including joint venture arrangements are not eligible to the SCP. 
 
All recommendations of the Committee shall be jointly approved by the 
Secretary and the Board of the LBP: Provided, That the existing rules, regulations, 
and 
policies of LBP shall govern all implementation activities of the SCP, such as but not 
limited to, credit and background investigation and loan documentation, evaluation, 
award, negotiation, collection, and restructuring: Provided, further, That the LBP and 
the Department shall exchange relevant information to assess the eligibility of the 
water service providers to be a recipient of a grant or subsidy. Relevant information 
may include, but is not limited to, credit standing, existing loan obligations, and 
compliance with previous or existing loan covenants. 
 
The IRR shall provide other functions of the Committee that are necessary for 
the effective implementation of the SCP, including the creation of sub-committees, 
their composition and delegated functions. 
Other Government Financial Institutions, such as, but not limited to, Development 
Bank of the Philippines, may provide a similar SCP for water service providers: 
Provided, That these other GFis shall submit monitoring reports to the 
Department thru the Committee. 
 
Sec.  25.  Support  Program  for  Local  Water Service  Providers. - The 
Department, the Department of Finance, and the Department of Budget and 
Management shall issue guidelines in the disbursement of any grant, from any 
sources, and subsidy from the National Government: Provided, That the Department 
shall be the implementing agency for this purpose. Provided, further, That all income 
derived from the lending activities shall be recorded as LBP's income. 
CHAPTER IV 
THE NATIONAL WATER SECTOR POLICY COUNCIL 
 
Sec. 26. Creation of the National Water Sector Policy Council. - There is 
hereby established a National Water Sector Policy Council (NWSPC), hereinafter 
referred to as the Council, which shall exercise policymaking, coordination, 
harmonization, integration, supervision, monitoring and evaluation functions with 
regard to water, land, subsurface, air, and other natural resources. The Council shall 
be composed of the following members: 
(a)
Secretary of the Department of Water Resources as Chairperson; 
(b)
Director-General of the National Economic and Development Authority as the 
Vice-Chairperson; 
(c)
Secretary of the Department of Health (DOH); 
(d)
Secretary of the Department of the Interior and Local Government (DILG); 
(e)
Secretary of the Department of Energy (DOE); 
(f)
Secretary of the Department of Agriculture (DA); 
26


(g)
Secretary of the Department of Social Welfare and Development (DSWD); 
(h)
Secretary of the Department of Public Works and Highways (DPWH); 
(i)
Secretary of the Department of Budget and Management (DBM); 
(j)
Secretary of the Department of Environment and Natural Resources (DENR); 
(k)
Representative from the Office of the President (OP); and 
(l)
Chairperson of the National Commission on Indigenous People (NCIP) as 
members. 
   The Staff of the Department shall serve as the Secretariat to the Council. 
Sec. 27. Powers and Functions. -The powers and functions of the Council 
shall be as follows: 
(a)
Ensure harmonization of all policies involving water, land, subsurface, air and 
other resources which are connected to the water sector; 
(b)
Ensure a multi-stakeholder participation in the development, updating, and 
sharing of information system as policy, planning and decision-making 
tools; and 
(c)
Recommend the integration of harmonized policies and priority programs in the 
National Water Resources Management Plan and the National and Regional 
Septage Management Plan. 
CHAPTER V 
INTERDEPARTMENTAL RELATIONS 
AND INSTITUTIONAL ARRANGEMENTS OF THE DWR 
 
Sec. 28. Interface and Institutional Arrangements With Other Agencies. – 
(a) The Department of Environment and Natural Resources (DENR) shall 
continue to have primary authority and responsibility for protecting the 
environment and managing the country’s watersheds. The pollution 
Adjudication Board shall remain to have jurisdiction with respect to 
adjudication of pollution cases based on exceedance of the DENR Effluent 
Standards and other acts defined as prohibited under Section 27 of R.A. No. 
9275: Provided, That the Department shall coordinate with the DENR 
regarding the establishment of protocols for management of all water-
related data being collected by the DENR; 
(b) The Department of Health (DOH) shall continue to have primary authority and
responsibility for setting and enforcing drinking water quality standards:
Provided, That the Department and the Water Regulatory Commission shall 
coordinate with the DOH in this aspect, and shall ensure consistency of 
standards and targets, as well as the compliance of licensees with 
mandated standards; 
(c) The Department of Energy (DOE) and the National Power Corporation 
27


(NPC) shall continue to have primary authority and responsibility for 
setting up and running hydropower plants: Provided, That all hydropower plant 
development plans shall be consistent with the NWRMP; 
(d) The Department shall coordinate with the Department of Agriculture (DA) to 
promote agricultural development that reduces sources of long-term 
pollution for surface water and groundwater, and agricultural and industrial 
economic development that employs water efficiency, water recycling or 
reuse and the appropriate treatment of wastewater: Provided, That the 
Department shall coordinate with the DA and its Bureau of Soild and Water 
Management (BSWM) regarding the establishment of protocols for 
management of all water-related data being collected by the DA, as well as 
the outputs of research and studies by BSWM which may serve as input to 
policy formulation by the Department; 
(e) The Department shall coordinate with the Department of Public Works and 
Highways (DPWH) in setting the policies and preparing the master plans for 
bulk water transmission, pipe networks, and related water delivery 
infrastructures as well as flood control and drainage management, and other 
related projects under the DPWH: Provided, That the DPWH shall continue to 
have primary responsibility in the construction and implementation of water 
delivery infrastructures and flood control projects: Provided, further, That 
flood management plans are aligned with the NWRMP and flood waters be 
considered and harnessed as potential water source: Provided, finally, That 
the Department shall coordinate with the DPWH regarding the establishment of 
protocols for management of all water-related data being collected by the 
DPWH and its Bureaus; 
(f) The Department shall coordinate with the National Disaster Risk Reduction 
Management Council (NDRRMC) to ensure that its plans and designs for flood 
control, flood risk management and drought risk management are aligned 
with the objectives and plans of the Department; 
(g) The Department shall coordinate with Philippine Atmospheric, Geophysical, and 
Astronomical Services Administration (PAGASA), Climate Change 
Commission (CCC), and 
National Mapping and 
Resource Information Authority (NAMRIA) on scientific studies, integrated 
surveys, mapping, charting and decision support systems; 
(h) The Department shall coordinate with the Department of Tourism (DOT) on 
recreational use of water resources; 
(i) The Department shall coordinate with the Tourism Infrastructure and 
Enterprise Zone Authority (TIEZA), 
Philippine 
Reclamation Authority 
(PRA), and economic zone authorities on water resources development and
water requirements within tourist zones, reclamation areas and economic 
zones, respectively; 
(j) The Department shall coordinate with the Bangsamoro Autonomous 
Region in Muslim Mindanao (BARMM), specifically its Economic and 
Development Council, Disaster Risk Reduction and Management Council, 
and Ministry of Environment, Natural Resources and Energy, regarding the 
28


preparation of master plans of river basins that overlap with the inland 
waters within the BARMM's jurisdiction, and ensure the alignment of these 
plans with the NWRMP, Bangsamoro Development Plan, and other related 
regional plans of BARMM; 
(k) The Department shall coordinate with the Department of Human Settlements 
and Urban Development in planning, monitoring and enforcing integrated land 
use and water resources management in the Comprehensive Land Use 
Development Plans and Zoning Ordinances of the LGUs to ensure, among 
others, the protection of water sources and that water availability is factored 
in proposed land use development plans and projects; and 
(l) The Department shall coordinate with relevant government agencies, 
including LGUs, with respect to development projects and to ensure cross-
cutting collaboration between and among all water subsectors and 
facilitate 
inter-agency subsector coordination, strategic development, 
planning, monitoring and provision of technical, institutional and financial 
capacity building support to their different stakeholders at the water 
subsector level. 
CHAPTER VI 
WATER REGULATORY COMMISSION 
 
Sec. 29. Establishment - There is hereby created and established an 
independent, quasi-judicial regulatory body to be known as the Water Regulatory 
Commission, hereinafter referred to as the Commission. The Commission shall have a 
Board of Commissioners, and shall be vested with powers and functions, as conferred 
and set forth hereunder. 
 
Sec. 30.  The Central and Regulatory Units. - The Regulatory Units of the 
Commission shall be composed of the Regional Regulatory Units and the Central 
Regulatory Unit. 
 
The economic regulatory units and functions of the MWSS, NWRB, and LWUA 
are hereby transferred to the Commission, and shall collectively comprise its Central 
Regulatory Unit for Water Supply, Sanitation and Sewerage Services that: (a) provide 
services to more than one province; and (b) are owned, operated, or maintained by 
Metro Manila concessionaires. 
 
The Regional Regulatory Units shall be established by the Commission in 
accordance with the rules, regulations, guidelines, and standards that the 
Commission shall issue, and as provided in this Act. 
 
Sec. 31. Powers and Functions of the Commission. -The overall authority and 
powers of the Commission shall cover and apply to all service providers, whether 
private or public, providing or intending to provide water supply, including suppliers 
to subdivisions, bulk water suppliers, and other providers for sewerage, and septage 
treatment and disposal services for domestic, residential, institutional, industrial or 
commercial use. 
29


 
The Commission shall exercise the following powers and functions:  
(a) Issue and promulgate rules, regulations and guidelines as may be necessary 
to implement and enforce its powers and functions under this Act; 
(b) Issue licenses authorizing the operation of water supply, sanitation, and 
sewerage services in any specified area or areas within the Philippines;  
(c) Issue rules and regulations on terms and conditions prescribing minimum and 
mandatory terms for concession agreements, joint venture agreements, 
management agreements, service contracts or 
other contractual 
arrangements that may be entered into by government entities including 
local water utilities, LGUs, private sector entities, or other water service 
providers for the provision of water, sanitation, or sewerage services, such 
as, but not limited to the (i) the term, scope and total cost of the activity, 
which may be subdivided into phases; (ii) committed contributions and 
corresponding performance security requirements in accordance with any 
agreed phased implementation of the activity; and (iii) cost recovery schemes 
and percentage of the parties' share in the profits and losses, among others; 
(d) Require the review or approval of contracts or agreements that may impact on 
the tariff and rates of service provision entered into by service providers upon 
petition or motu proprio when public interest so dictates;  
(e) Set, regulate, review, and monitor the tariffs, rates, charges, and fees for the 
use of water resources in the Philippines, including irrigation service fees, bulk 
water rates, and septage rates, which may be delegated to the Regulatory 
Units; 
(f) Amend, modify, suspend, or revoke any license issued by them, after due 
notice and hearing, on any of the following grounds: 
(i) When the facts and circumstances on the strength of which the license 
was issued have been materially misrepresented or have materially 
changed; 
(ii) Where the licensee has failed to meet or comply with terms, 
conditions, and performance targets, including but not limited to service 
expansion, that may have targets, including but not limited to service 
expansions, that may have been set in the license; 
(iii) Where the licensee is found to be manifestly inefficient in the 
operation of or provision of water supply, sanitation, and sewerage 
services in its area; or 
(iv) When the licensee thereof has violated or willfully refused to comply 
with any order, rule or regulation of the Commission or any provision of 
this Act; 
(g) Promulgate and enforce just and reasonable technical standards, 
classifications and measurements of service; 
(h) Enforce technical, financial, and other performance standards set by the 
Commission for licensees or utilities; 
30


(i) Conduct benchmarking and monitor the performance of licensees or 
utilities under their jurisdiction, and publish reports detailing the results 
thereof; 
(j) Coordinate with the Philippine Competition Commission (PCC) by providing
technical support in the PCC's exercise of authority and jurisdiction to 
establish rules and enforce regulations to monitor, investigate, provide 
remedies for, and deliberate on cases involving any market power abuse or 
anti-competitive or discriminatory act or behavior by 
or against 
any 
participant in the water supply, sanitation, and sewerage sector. Without 
prejudice to the actions that the Philippine Competition Commission,
pursuant to Republic Act No. 10667, may undertake on its own, the Water 
Regulatory Commission may be directed by the Philippine Competition 
Commission, upon finding that a market participant has engaged in, or fell 
victim to such act or behavior, to stop or redress the same within the functions 
and powers granted to the Water Regulatory Commission under this Act; 
(k) Adopt and require that books, records, and accounts be kept and 
maintained in accordance with the prescribed uniform accounting system; 
(l) Require the submission of plans, reports on finances and operations, 
performance targets, and accomplishments verified under oaths by the owner 
or president and secretary of the licensee; 
(m)Determine and require the monitoring and submission of such data, 
statistics, and other information from any or all licensees as may be 
necessary for the effective and efficient exercise of its duties, functions, 
powers and responsibilities: Provided, That such data, statistics, and 
other 
information shall also 
be submitted 
to the Department for 
integration in the centralized database on water resources; 
(n) Fix and determine proper and adequate rates of depreciation of 
properties and equipment used in water supply, sanitation, and sewerage 
services; 
(o) Impose and collect annual levies and reasonable fees and surcharges as may 
be necessary for achieving the purposes, powers, and functions of the 
Commission: Provided, That the rate of annual levies and fees shall be 
determined strictly on a cost recovery basis for the reasonable and actual
cost of regulation in accordance with applicable rules and regulations on 
the imposition and increase of charges; 
(p) Investigate, motu proprio or upon complaint in writing, any matter 
concerning the operation of the service and violations of this Act; 
(q) Respond to consumer complaints and ensure the adequate promotion of 
consumer interests and investigate motu proprio violations; 
(r) Investigate accidents directly or indirectly arising from or connected with the 
maintenance or operation of the service, and make such order or 
31


recommendation as the public interest may warrant; 
(s) Impose penalties and fines, which may include, but is not limited to, 
rebates, refunds, and credits to affected consumers, against any licensee or 
against its owners, directors, officers, agents or representatives for any 
violation of this Act or of the license, order, rule regulation or 
requirement issued by the Commission; 
(t) Require any licensee to pay the actual expenses incurred by the 
Commission in any investigation if it shall be found that a licensee violated 
any provision of this Act or of the license, order, rule regulation or 
requirement issued by the Commission; 
(u) Appoint an interim or temporary management committee upon appeal and 
after due hearing, to ensure continuity of service in cases a licensee fails to 
meet conditions of the license; 
(v) Advise, apprise, and coordinate with the Department, the National Water Sector 
Policy Council, and other relevant agencies of the national or local government 
on any matter relating to water supply, sanitation, and sewerage services; 
(w)Deputize any official or agency of the government to assist in the 
performance of any of the powers and functions of the Commission; 
(x) Appoint, hire, and maintain the Central and Regional Regulators, 
adequate staff and personnel, advisers, and consultants, with suitable 
qualifications and experience, as necessary, subject to existing civil 
service laws, rules, and regulations; 
(y) Exercise original and exclusive jurisdiction over all cases contesting rates, 
fees, fines and penalties imposed by the Regulatory Units in the exercise of 
their powers, functions and responsibilities, as provided under this Act, and over 
all cases involving disputes between and among participants or stakeholders in 
the water supply, sanitation, and sewerage services; and 
(z) Such other incidental powers and functions as may be necessary to attain the 
objectives of this Act. 
 
Sec. 32. Composition of the Water Regulatory Commission. - 
(a) The Commission shall be a collegial body composed of five (5) full-time 
members consisting of a Chairperson and four (4) members, who shall all 
be appointed by the President of the Philippines. All members of the 
Commission must be citizens and residents of the Philippines, at least 
thirty five (35) years of age, and of good moral character, recognized 
integrity and competence in the field of law, business, commerce, 
finance, accounting or public administration, water or utility economics, 
management, physical or engineering services, hydrology and other 
related services, with at least three (3) years of actual and distinguished 
32


experience in their respective fields of expertise: Provided, That out of the 
four members of the Commission, at least one (1) shall be a member of the 
Philippine Bar with at least ten (10) years of experience in the active
practice of law, at least one (1) shall be a certified public accountant 
with at least ten (10) years of experience in active practice; and at least one 
(1) shall be a licensed engineer with at least ten (10) years 
 of 
experience in 
the  water 
supply, 
 sewerage, 
 or 
 septage 
management sector; 
(b) The term of office of each member of the Commission shall be seven (7) 
years: Provided, That among the members first appointed, the Chairperson 
shall serve for a period of seven (7) years, two (2) members shall serve for
five (5) years and the other two (2) members shall serve for three (3) years: 
Provided, further, That any member whose term has expired as specified 
herein shall serve as such until his successor shall have been appointed 
and qualified: Provided, furthermore, That any appointment to fill a 
vacancy in the Commission arising from death, removal, retirement or 
resignation shall be made only for the unexpired term: Provided, finally, That 
in no case shall any member serve for more than seven (7) years in the 
Commission. 
(c) The Commission shall meet as often as may be necessary on such day or 
days as the Chairperson may fix. The presence of at least three (3) 
members of the Commission shall constitute a quorum, which shall be 
necessary for the transaction of any business. The affirmative vote of 
majority of the members of the Commission where a quorum is present shall 
be necessary for the adoption of any order, resolution, decisions, or other act of 
the Commission in the exercise of its quasi-judicial functions: Provided, That in 
promulgating rules, regulations, guidelines and in the exercise of its quasi-
legislative functions, an affirmative vote of three (3) members shall be 
required. 
(d) The Chairperson of the Commission shall exercise general executive 
control and supervision of the Commission and its members, staff and 
personnel, agents, and representatives. Within three (3) months from the 
creation of the Commission and the appointment of all members of the 
Commission, the Chairperson shall submit for the approval by the 
President of the Philippines 
the new organizational structure 
and 
personnel positions necessary to carry out the powers and functions of the 
Commission, subject to the review and approval of the DBM. The 
personnel positions of the Commission s h a l l b e f i l l e d b y r e g u l a r 
appointments in accordance with civil service laws, rules, and regulations. 
(e) Members of the Commission shall enjoy security of tenure and shall not be 
suspended or removed from office except for just cause as specified by 
law. 
(f)
The Chairperson and members of the Commission or any of their relatives 
within the fourth civil degree of consanguinity or affinity, legitimate or 
common law, shall be prohibited from holding any interest whatsoever, either 
as investor, stockholder, officer or director, in any company or entity 
33


engaged in provision of water supply and distribution, septage 
management and sewerage services and must, therefore, divest through 
sale or legal disposition of any and all interests in the water sector upon 
assumption to office. 
 
Sec. 33. Secretariat of the Commission. - The Commission shall establish a 
Secretariat which shall provide the Commission with technical and support 
services such as, but not limited to the following: 
(a) Provide the necessary technical inputs and secretariat support to the 
Commission to facilitate the conduct of its functions; 
(b) Coordinate with, monitor, and assess the activities of the Regulatory Units to 
ensure proper implementation of the rules, regulations, and guidelines 
promulgated by the Commission; 
(c) Maintain a database on the water supply, sanitation, and sewerage 
subsector; and 
(d) Coordinate   with other relevant  agencies  of the national o r 
l o c a l 
government on any matter relating to water supply, sanitation, and 
sewerage. 
 
Sec. 34. The Commission Secretariat -The Executive Director shall head the 
Commission Secretariat, keep and maintain the official records, and report of the 
proceedings of the Commission, and administer oaths in all matters falling within the 
jurisdiction of the Commission. 
 
The Commission shall appoint, fix the compensation, and determine the status, 
qualifications, and duties of the Executive Director and the Secretariat staff subject to 
civil service laws, rules, and regulations. The Executive Director shall have at least ten 
(10) years of experience in the field of law, business, commerce, finance, accounting 
or public administration, water or utility economics, management, physical or 
engineering services, hydrology and other related services. The members of the 
technical staff, except those performing purely clerical functions, shall possess at least 
a Bachelor's Degree in any of the following lines of specialization: law, public 
administration, economics, finance, engineering, accounting, or management.  
 
The Executive Director shall be responsible for the effective implementation of 
the policies, plans, programs, rules, regulations, and directives of the Commission; 
coordinate and supervise the activities of the different operating units under the 
Commission; and perform such functions as may be assigned by the Chairperson and 
other members of the Commission. 
 
Sec. 35. Enhancement of Technical Competence. - The Commission 
shall establish rigorous training programs for its staff for the purpose of enhancing 
the technical competence of the Commission in the following areas: evaluation of 
technical performance and monitoring compliance with service and performance 
standards, performance-based rate-setting reform, environmental standards, and 
such other areas as will enable the Commission to adequately perform its duties and 
functions. 
34


 
Sec. 36. Compensation and Other Emoluments. - The compensation of 
the members of the Commission and its staff shall be exempted from the coverage 
of Republic Act. No. 11466, otherwise known as the "Salary Standardization Law 
of 2019”.  as amended. For this purpose, the schedule of compensation of the 
Commission shall be submitted for approval of the President of the Philippines. The 
compensation schedule of the Commission shall be implemented within six (6) months 
from the effectivity of this Act and maybe upgraded by the President of the Philippines 
as the need arises: Provided, That in no case shall the compensation of the 
Commission and its staff be upgraded more than once a year: Provided, further, That 
pertinent civil service laws, rules, and regulations shall be applicable to the 
Commission. 
 
The Chairperson and members of the Commission shall initially be entitled to 
the same salaries, allowances and benefits as those of the Presiding Justice and 
Associate Justices of the Court of Appeals, respectively. 
CHAPTER VII 
REGISTRATION AND LICENSING 
 
Sec. 37. Registration and Licensing of All Water Supply, Sanitation, and 
Sewerage Services. - All water supply, sanitation, and sewerage service providers, 
including bulk water suppliers and those providing services to subdivisions and other 
service providers, shall register with the Commission and, subject to its rules, 
guidelines, procedures and other issuances of the Commission, obtain a license to 
operate from the appropriate regulatory units: Provided, That the Commission shall 
act on the application for the issuance or the conversion of such licenses and renewals 
thereof within the maximum period of one (1) year as provided under this Act or by 
Republic Act No. 11032, otherwise known as the "Ease of Doing Business and 
Efficient Government Service Delivery Act of 2018”. 
 
The Commission shall also ensure that the grant and revocation of licenses are 
carried out fairly, transparently, and without discrimination. Issuances of the 
Commission shall specify, among others, the qualifications, requirements and 
procedure for the grant and revocation of licenses including the standards and 
performance targets that shall continuously be complied with to keep the licenses 
valid. 
 
The Commission shall specify the requirements and procedure for existing 
holders of a Certificate of Public Convenience (CPC), Certificates of Public 
Convenience and Necessity (CPCN) issued by NWRB, or Certificate of 
Conformance (CoC) issued by LWUA, to convert their existing certificates into 
licenses to operate. 
 
All local water utilities, existing water service providers, or holders of CPCN or 
CoC shall be duly prioritized in the issuance of the licenses to operate over the areas 
where they currently operate or as may be covered by their franchises. The submission 
of the CPC, CPCN, provisional authority, or the Coe shall be sufficient basis for the 
issuance of the new and converted or updated licenses to operate required and 
contemplated under this Act. To ensure continuity of service, the Commission shall 
35


complete the issuance of such converted or updated licenses not later than six (6) 
months from the effectivity of the implementing rules and regulations issued by the 
Commission pursuant to this Act. 
 
Unless otherwise provided in this Act or by the Commission, no public water 
supply, sanitation, and sewerage service provider shall commence or conduct the 
business of providing water supply, sewerage, and sanitation services without first 
obtaining a license. 
 
Concession agreements and other contracts for water supply provision and 
water sanitation and treatment services currently existing shall remain valid and 
enforceable unless otherwise terminated, after due notice and hearing for reasons 
provided in the existing terms and conditions under the concession or service 
agreement or contract, or invalidated by the Commission, after due notice and 
hearing, where national security, national emergency, or public interest so dictates. 
 
Sec. 38. Conditions of License. - The Commission may impose such 
conditions in the issued license, as it may deem necessary, such as, but not limited to: 
(a)
Tariffs, rates, and charges that may be imposed from its customers or 
consumers; 
(b)
Term fixing the duration of the privilege; 
(c)
Grounds for modification, suspension, or cancellation of the license; 
(d)
Minimum technical performance and service level standards, such as but not 
limited to: (i)  water pressure; (ii) minimum flow rates; (iii) connections; (iv) 
sewerage discharge, billing, and metering requirements, and (v) sanctions for 
failure to comply with the standards set; 
(e)
Expansion targets and service level improvements over time; 
(f)
Restrictions or conditions for transferability of the business or controlling 
interest in the business; 
(g)
Reportorial requirements and obligations of the grantee; and 
(h)
Submission to annual performance audit by the Commission or its duly 
authorized representative. 
 
Sec. 39. Rights and Duties of Licensees. - 
(a) Any person granted a license under this Act or with existing rights under 
concession agreements and related agreements shall have the obligation to 
ensure that licensed activities are conducted to further public interest and, in 
particular: 
(i)
Foster the 
maintenance and 
development of 
e f f i c i e n t , 
coordinated, and viable operation of their licensed activities; 
(ii) Ensure that their water supply, sanitation, and sewerage services are 
provided in a diligent, conscientious and workman like manner, in 
36


accordance with applicable laws rules and regulations issued by the 
Commission and the generally accepted standards and practices in the 
water supply, sanitation, and sewerage industry; 
(iii) Comply with drinking water quality requirements and standards that may 
be established by the Commission, Department, and DOH; and 
(iv) Ensure that provision of services shall not be discontinued without notice 
to, and approval by, the Commission. 
(b)
Any person granted a license under this Act shall, to the extent allowed by 
law and specified in the license, has the right to acquire or lease land, lay or 
repair water or sanitation mains, and other relevant facilities in public ways 
to fulfill the terms and conditions under the license; 
(c)
Subject to any condition or limitation laid down in the license, a licensee may 
discontinue water supply, sanitation, and sewerage services to a customer 
if such customer defaults in the payment of fees due to the licensee for the 
water supplied or sanitation services provided, or for acts of pilferage 
pursuant to Sections 8, 9, 10, and 11 of Republic Act No. 8041, otherwise 
known as the "Water Crisis Act of 1995"; 
(d)
Any license issued under this Act shall contain provisions designed to 
ensure that licensees: 
(i)Publish the Tariff and other charges approved by and the terms and 
conditions imposed by the Commission for the provision of water supply, 
sanitation, and sewerage services; 
(ii) Prepare, within three (3) months from the issuance of a license, in 
consultation with its customers, a customer service code specifying the 
manner and procedure for: 
(a) Metering, billing, and collection of the licensee's approved tariff and 
other charges; 
(b) Disconnection or suspension of service in case of non payment 
of tariffs and other charges, or acts of pilferage; and 
(c) Recommendation and recovery of arrears in tariffs and other charges. 
(iii) Maintain financial accounts in accordance with the manner and 
procedure specified in the license and as may be required by the 
Commission; and 
(iv) Maintain and, upon request by anyone during regular office hours, 
promptly make available for scrutiny and inspection such data, statistics 
and other information, as may be required by the Commission. 
 
Sec. 40. Setting Tariffs, Rates and Other Charges. - The Commission 
shall establish tariffs, rates and other charges which are fair and reasonable, 
and ensure environmental sustainability, economic viability, and a fair return on 
investments.  
37


 
Service providers may apply for the setting of tariffs, rates, and charges based 
on and consistent with a scientific and evidence-based rate-setting methodology 
that the Commission shall, after due consultation, define and publish, taking into 
account the following, among others: 
(a)
Reasonable and prudent capital and recurrent costs of providing the 
service including a reasonable rate of return on capital; 
(b)
Efficiency of the service; 
(c)
Incentives for enhancement of efficiency; 
(d)
Capacity to pay of consumers; 
(e)
Equity considerations; 
(f)
Environmental sustainability; 
(g)
Administrative simplicity; 
(h)
In cases involving valid and subsisting concession agreements prior to the 
enactment of this Act, the methodology 
p r o v i d e d 
u n d e r 
t h e 
concession agreement; 
(i)
To the fullest extent practicable, the terms and conditions of the tariffs, 
rates or other price-setting mechanisms set forth in any concession 
agreement, joint venture agreement or other similar agreement for the 
provision of water or sanitation services by an existing service provider. 
 
Tariffs, rates, and charges set by the Regulatory Units shall be presumed valid 
and reasonable unless invalidated by the Commission, after due notice and hearing, 
acting on a protest or contest duly filed with the Commission to ensure continuity of 
service, application for setting of tariffs, rates and other charges shall be decided 
within a non-extendible period of ninety (90) days from the date of filing thereof, and 
the failure of the Commission to act on any such applications shall result in a 
provisional approval: Provided, That in no case shall proceedings on any 
applications for the setting of tariffs, rates and other charges exceed to a total 
period of one hundred twenty (120) days reckoned from the date of filing of the 
application. 
 
Sec. 41. Direct Access. -  Fifty-one percent (51%) of the registered water 
consumers in a service area, municipality, city or province may petition for direct 
access to water from any water service provider subject to concurrence by and 
reasonable compensation to the service provider and approval by the Commission. If 
the petition for direct access from any water service provider is approved by the 
Commission, the new water service provider shall reimburse the existing service 
provider for, as applicable, either the book value or the market value as determined 
by an independent appraiser accredited by the Commission, whichever is higher, of 
the water source, water supply, or water distribution or transmission facilities, 
pipelines and other equipment which shall be transferred to or utilized by the new 
water service provider. The Commission shall promulgate the implementing rules and 
procedures for this mode of service, which shall include, among others, financial and 
technical capability of the new service provider. 
38


 
Sec. 42.  Innovative Schemes to Improve Efficiency and Management of 
Systems.  - The Commission 
shall promote innovative schemes such as the 
consolidation or integration of water supply, sanitation, and sewerage services, or 
providers in the same service area, where it shall result in improved efficiency, service 
expansion and lower costs. 
 
To this end, the Commission shall establish and issue such rules and guidelines 
as may be necessary to (a) create performance-based and time-bound incentives to 
encourage efficiency and service expansion; (b) establish the standards and targets 
that service providers are required to meet; and (c) define the fines and penalties that 
shall be imposed for failure to meet such standards and targets. 
CHAPTER VIII 
PROCEEDINGS BEFORE THE COMMISSION 
 
Sec. 43. 
Proceedings Before the Commission. -  For the purpose of 
any investigation, inquiry, or proceeding, the Commission shall: 
(a) Issue subpoena duces tecum and subpoena ad testificandum; 
(b) Appoint hearing officers to hear and receive evidence on behalf of the 
Commission; 
(c) Cite any person or party for contempt for refusal to appear, testify or 
comply with an order of the Commission on any matter that is the subject 
of investigation, inquiry or proceeding before the Commission. 
 
Sec. 44. Orders and Decisions of the Commission. -Any order, resolution, or 
decision of the Commission shall be promulgated promptly, expeditiously, reasonably, 
and in writing, and shall state clearly and distinctly the facts and law on which it is 
based. The Commission shall publish and make available for public inspection, all 
decisions and final orders in the adjudication of contested cases or applications. 
 
Sec. 45. Appeals Procedure. - The orders, rulings, and decisions of the 
Commission are final and executory unless appealed to the Court of Appeals within 
fifteen (15) days from receipt of notice of such order, ruling or decision: Provided, 
That orders, rulings, and decisions of the Commission approving tariffs, shall be 
immediately executory and may be suspended only upon appeal and filing of a bond, 
in an amount to be fixed by the Commission, to answer for damages occasioned by 
the suspension or stay of execution of such orders, rulings, and decisions. 
 
Sec. 46. Prohibition Against Injunctions. - Except for the Supreme Court, no 
temporary restraining order, preliminary injunction, or preliminary mandatory 
injunction may be issued by any court to restrain any proceeding before, or the 
implementation or execution of any order, ruling, or decision of the Commission. 
CHAPTER IX 
TRANSITORY PROVISIONS 
 
Sec. 47. Transition Period.- The Department shall, by virtue of this Act be 
39


subrogated to all the rights and assume all the functions of the government agencies 
and units whose powers and functions have been subsumed, absorbed, transferred or 
attached to the Department. The Commission shall also, by virtue of this Act, be 
subrogated to all the rights, and assume all the functions, of the Water Utilities Division 
of the NWRB, the regulatory offices of MWSS and LWUA, and all other government 
agencies and units whose powers and functions have been transferred to the 
Commission in accordance with the civil service laws, rules, and regulations. 
 
The transfer of powers and functions to the Department or the Commission of 
the concerned agencies as herein provided for, shall be deemed completed within six 
(6) months after the effectivity of this Act. 
 
All agencies transferred, subsumed and attached to the Department or the 
Commission, shall continue to function under their preserit mandates until the six-
month transition period mandated under this Act shall have lapsed. The transfer of 
powers and functions shall include all applicable funds, personnel, records, property 
and equipment, as may be necessary. The heads of the affected agencies shall 
continue to serve until replaced. 
 
All rights and functions of the affected agencies are hereby transferred to and 
assumed by the Department or the Commission, and shall be acted upon in 
accordance with the rules and regulations of the Commission on Audit and other 
pertinent laws, rules, and regulations. 
 
Sec. 48. 
Absorption or Separation from Service of Employees of the 
Subrogated Agencies. - The current employees of all government agencies and units 
whose powers and functions have been transferred to, absorbed or subsumed by the 
Department or Commission shall enjoy security of tenure, in accordance with their 
staffing pattern and the selection process as prescribed under Republic Act No. 6656 
or the "Government Reorganization Law".  
 
 
 
Employees opting to be separated from the service as a consequence of the 
consolidation and reconstitution under the provisions of this Act, shall, within one (1) 
month from their separation or phase out from the service, receive separation benefits 
in accordance with existing laws and those who are qualified to retire shall be allowed 
to retire and be entitled to all benefits under existing retirement laws, subject to 
existing rules and regulations of the Commission on Audit. 
CHAPTERX 
FINAL PROVISIONS 
 
Sec. 49. 
Applicability of Ease of 
Doing Business Law. - The 
prescribed processing time provided under Section 9(b) of Republic Act No. 
11032 shall be applicable to all agencies and LGUs covered under this Act 
particularly on accessing government services. 
 
Sec. 50. Appropriations. -The amount necessary for the initial implementation 
of this Act shall be charged against the current year's appropriations of the agencies, 
entities, divisions, sections or units subsumed or transferred to the Department. 
40


Thereafter, such amount shall be included in the annual General Appropriations Act. 
 
Sec. 51. Implementing Rules and Regulations. - Upon the effectivity of this 
Act, the Department and the Commission, as may be applicable, as well as NEDA, 
DBM, DENR, CSC, and the National Commission on Indigenous Peoples in 
consultation with concerned government agencies shall promulgate the 
implementing rules and regulations (IRR) of the Department and the Commission 
necessary for the effective implementation of this Act within one hundred eighty 
(180) days after its effectivity. 
 
Sec. 52. Separability Clause. - If any reason, any portion or provision of this 
Act shall be held unconstitutional or invalid, the remaining provisions not affected 
thereby shall continue to be in full force and effect. 
 
Sec. 53. Repealing Clause. - 
              (a) 
The following provisions are hereby repealed: 
 
(i) Section 3 (h) and Section 12 on the fixing of water rates and 
sanitation service fees, Section 3 (n) on regulation of waterworks and 
deep wells, and Section 3 (p) on the regulation of waterworks and 
sanitation systems in 
privately owned subdivisions of Republic Act 
No. 6234; 
 
(ii)Section 62 on regulation and Section 63 on rate review of 
Presidential Decree No. 198 otherwise known as the "Provincial 
Water Utilities Act of 1973", as amended by Letter of Instruction No. 
700 - "Providing Measures To Control And Regulate Increase In
Water Rates", Letter of Instruction No. 744 - "Relative To Reliable 
Water Supply At Reasonable Rates In The Countryside", Executive 
Order No. 124-A, series of 1987 - "Reorganization Act of the 
Ministry of Public Works and Highways", and Executive Order No. 
123, 30 January 1987 - "Reorganization Act of Ministry of Social 
Services and Development"; and 
 
(iii)Executive Order No. 22, series of 2023, creating the Water 
Resources Management Office of the DENR; and 
 
(iv)Section 154, Article V, Chapter I, Title One, Book II of Republic 
Act No. 7160 otherwise known as the "Local Government Code of 
1991", as amended, and its implementing rules and regulations on 
the power of the LGUs to fix the rates of water utilities owned, 
operated and maintained by them within their jurisdiction. 
 
(b) All other laws, presidential decrees, executive orders, presidential 
proclamations, rules and regulations, or parts thereof which are 
inconsistent with the provisions of this Act are hereby repealed or 
amended accordingly. 
 
Sec. 54. Effectivity. - This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation.  
 
Approved,
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