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

FIFTEENTH CONGRESS
Second Regular Session

0190

HOUSE BILL NO.

Introduced by HON. JOCELYN S. LIMKAICHONG

EXPLANATORY NOTE

Republic Act No. 8976, otherwise known as the “Philippine
Food Fortification Act of 2000”, was signed into law on November 7,
2000. RA 8976, provides for, among other things, the mandatory
fortification of certain staple foods with specific nutrients including
refined sugar, with Vitamin A. Pursuant to Section 2, Rule XVI of
the Implementing Rules of Regulations of R.A. 8976, the mandatory
fortification of refined sugar was supposed to commence on
November 7, 2004.

Before the implementation of mandatory fortification in
November 2004, representatives from the sugar industry (of PASRI
and sugar traders and repackers) met officials from the Department
of Health (DOH), through the officers of the Bureau of Food and
Drugs (now Food and Drugs Administration), to present and convey
the problems and constraints in fortifying refined sugar with vitamin
A. After a series of consultations between BFAD/DOH and sugar
refineries and refined sugar repackers, a consensus was reached
that the mandatory fortification of refined sugar with Vitamin A is
not practical and cannot be effectively implemented. As a result
mandatory food fortification of refined sugar with vitamin A was not
pursued by BFAD/DOH.

This bill seeks to amend the Act by removing refined sugar
from the mandatory food fortification program, in view of the
various constraints and problems related to the fortification of the
said product with vitamin A, to wit:

1. Sugar refineries - as manufacturers of refined sugar - are
not the owners of a large portion of raw sugar, which is processed
into refined sugar, and of the resulting refined sugar that it renders
mandatory fortification legally non-implementable.

—
sEPRESES

5 AS
receiven @
sve, 1 ZMAY 2012



The unique feature of the sugar industry is its “sharing
system” under Republic Act No. 809 or the Sugar Act of 1952.
Under the sharing system, farmers and sugar mills share or divide
between them and at pre-agreed percentages the resulting raw
sugar, among other products, from the milling of sugarcane.
Farmers and mills may sell their respective share of raw sugar to
traders and beverage or confectionary producers who in turn may
want to have the raw sugar further processed into refined sugar to
suit their product specifications. In some cases, farmers and mills
themselves have their raw sugar processed to refined sugar to avail
of a more attractive price. In all instances, sugar refineries just
impose a tolling fee for the processing of raw sugar to refined
sugar. Sugar refineries, therefore, do not acquire ownership over
the raw sugar and refined sugar.

Since sugar refineries are not the owners of the refined sugar,
they cannot just readily fortify the refined sugar with Vitamin A
despite the directive of Section 6(b) of R.A. 8976. The decision to
fortify refined sugar with Vitamin A is an act of ownership which
may be enjoyed and exercised only by their owners, as it will
introduce changes in the characteristic of refined sugar, and sugar
refineries which decide to fortify the refined sugar that they do not
own may be held legally accountable by the owners thereof.

2. Fortification of refined sugar entails additional cost to
manufacture which would result in a higher market price of the
product. This puts the product beyond the reach of the target
consumers who are at high risk of having vitamin A deficiency i.e.,

women and children in the lower income brackets of the economic
strata.

Tt has been estimated that the cost of fortifying refined sugar
with vitamin A costs Php 50.00/bag or about one peso per kilo of
refined sugar - a cost that will have to be passed on to the
consumers. The table below shows that the average price of refined
sugar is about P3.65/kg higher than washed sugar and about
P6.50/kg higher than raw sugar.


[Table 1. Average Retail Prices of Sugar (Metro Manila, 2013, 8/3

A study has shown that the price of refined sugar is a major
factor in the consumers’ decision to reduce consumption or shift to
lower-priced washed sugar (Analysis and Projection of Domestic
Demand, Asia Research Organization and the Center for Food and
Agri-Business of the University of Asia and the Pacific, February
2009). Likewise, an assessment of the Medium-Term Philippine
Plan of Action for Nutrition, 2005-2010, has reported that food
consumption surveys indicate that only 27.7 percent of households
in the lowest income quintile (poorest) use refined sugar, while 46.4
Percent use brown sugar. Thus, after incurring all that expense to
fortify refined sugar, the nutritional deficiency of the targeted group
will still not be addressed.

3. Fortification with Vitamin A hastens the deterioration of
refined sugar which affects the supply stocking programs of refined
‘Sugar users.

Under normal or dry conditions, refined sugar has a storage
life of up to 24 months from the date of production before any
significant discoloration can be discernable. This relative longetivity
of refined sugar is factored in by sugar traders, repackers and
industrial users of refined sugar such as beverage companies and
confectionaries in their purchases of the product. Strategically, they
buy and store up refined sugar or raw sugar for tolling into refined
sugar during the height of sugar milling to take advantage of more
flexible prices, which they will use in their respective businesses
during the lean and off-milling months ahead. This sugar stocking
mechanism makes their product fairly inexpensive and therefore
attractive to consumers.


However, fortifying refined sugar with Vitamin A speeds up
the discoloration process that about 6-8 months after fortification
the white crystals turns yellowish even if the refined sugar is placed
under normal or dry conditions, as reported by Victorias Milling
Company which conducted an initial Vitamin A fortification of some
99 sacks/bags of refined sugar in 1997, as its test run. According to
VMC, repackers and industrial users refused to purchase the
fortified refined sugar because of the risk of discoloration. Because
of this, it can readily be assumed that production schedules of
traders, repackers and industrial users will be affected as they
cannot and will not store up on refined sugar fortified with Vitamin
A. Consequentially, sugar farmers and mills will have high
Inventories brought about by weak refined sugar withdrawals.

4. Fortification will lead to a reduction in supply of refined
sugar in the market.

The risk of discoloration of fortified refined sugar is perhaps
the reason why no trader, repacker or industrial user has indicated
to any sugar refinery the fortification of his or her refined sugar.
With the slow turnover rate of refined sugar in the market and
undetermined conditions of repacking refined sugar at retail outlets
in public wet markets, the fear of discoloration heightens that
refined sugar retail outlets cannot risk losing their small margins on
discoloration. And their expected reaction to the mandatory
fortification of refined sugar shall be reduction in available supply of
refined sugar. Naturally, wholesalers and traders of refined sugar
will also reduce their purchases or tolling of refined sugar. Taking
this altogether, there will be a reduction in the volume of refined
sugar available in the market, or worse, the non-registration or
recall of unfortified refined sugar will cause a severe drop in the
available supply of refined sugar in the country.

This deficiency in supply cannot be compensated by imports,
as there is no country producing refined sugar for export that is
fortified with Vitamin A. Even Thailand, the largest sugar exporter in
Asia, is not fortifying its sugar. Therefore, there is no available
source of fortified refined sugar, either here or abroad

5. Very weak demand for refined sugar fortified with Vitamin

The test run of Victorias Milling Company (VMC) in 1997
wherein it fortified with Vitamin A about 99 bags/sacks of refined
sugar showed Filipino consumers preference for unfortified refined
Sugar over those fortified with Vitamin A. According to VMC, the 99
bags of fortified refined sugar were not sold, as there seems to be
consumer aversion for fortified refined sugar. Importantly, this
attitude is not confined to repackers, industrial and institutional


users of refined sugar but includes households that directly
consume the refined sugar. Direct consumers which use refined
sugar regularly and daily prefer the unfortified sugar. Expectedly,
traders, repackers and industrial users gave no indication to
refineries to fortify their refined sugar with Vitamin A. With a weak
and unenthusiastic market reception for fortified refined sugar, it is
impractical to implement the mandatory fortification of refined
sugar. Consumers will not patronize the product.

In the light of the above considerations, the amendment R.A.
8976 by removing or excluding refined sugar from the list
Products covered by mandatory food fortification with vitamin
earnestly proposed.



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

FIFTEENTH CONGRESS
Second Regular Session
0199
HOUSE BILL NO.

Introduced by HON. JOCELYN S. LIMKAICHONG

AN ACT
TO REMOVE OR EXCLUDE REFINED SUGAR FROM THE LIST OF
PRODUCTS COVERED BY THE MANDATORY FOOD
FORTIFICATION WITH VITAMIN A, AMENDING FOR THE
PURPOSE REPUBLIC ACT NO. 8976, OTHERWISE KNOWN AS
THE “PHILIPPINE FOOD FORTIFICATION ACT OF 2000”

Be it enacted by the Senate and House of Representatives of the
Philippines in Congress assembled:

SECTION 1. Section 3 of Republic Act No. 8976, otherwise
known as the “Philippine Food Fortification Act of 2000”, is hereby

amended to read as follows:

“Section 3. Definition of Terms. - For purposes of this
Act, the following terms shall mean:

(a) xxx.
(b) xxx.
(c) xxx.
(d) xxx.
(e) xxx.

(f) Manufacturer - the refinery in case of
[refined sugar or] cooking oil, the miller in
case of flour or rice, or the importer in case
of imported processed foods or food
Products or the processor in case of other
Processed foods or food products.”


SECTION 2. Section 6 of the same Act is hereby

amended to read as follows:

“Section 6. Mandatory Food Fortification. - (a) the
fortification of staple foods based on standards set by the
DOH through the BFAD is hereby made mandatory for the
following:

(1) Rice — with Iron;

(2) Wheat Flour - with vitamin A and Iron;

{(3) Refined Sugar - with vitamin A;]

{(4)] (3) Cooking Oil - with vitamin A; and

[6)] (4) Other staple foods with nutrients as
may later required by the NNC.

(b) The fortification of processed foods or food products
under this Section shall be undertaken by the
manufacturers: Provided, That in the case of imported
processed foods or food products, the required
fortification shall be done by the
Producers/manufacturers of such imported processed
foods or food products. Otherwise, the importer shall
have responsibility of fortifying the imported processed
foods or food products before said products are allowed
to be distributed or sold to the public: Provided, further,
That the implementation of the mandatory fortification
for wheat flour, [refined sugar,] cooking oil, and rice,
including those milled and/or distributed by the National
Food Authority shall commence after 4 years from the
effectivity of the Act.

(c) xxx.
(d) xxx.

(e) Imported rice, wheat flour, [refined sugar,] cooking
oil and other processed foods or food products that may
identified later by the NNC, shall comply with the
requirements of this Act on entry in country, at the end
of the manufacturing process and/or at all points of sale
and distribution.”


SECTION 3. Section 8 of the same Act is hereby amended to

read as follows:

“Section 8. Implementation, monitoring and Review -
The DOH through the BFAD shall be the lead agency for
the implementation and monitoring of this Act while the
NNC, the policy-making and coordinating body on
nutrition, shall serve as the advisory board on food
fortification.

xxx.

Xxx,
The local government units through their health officers
or agricultural officers or nutritionist-dieticians or the
sanitary inspectors shall assist in monitoring/checking
that foods to be mandated to be fortified like rice,
[refined sugar,] wheat flour and cooking oil are properly

fortified and labeled with “nutrition facts” indicating the
specific micronutrient it was fortified with.”

SECTION 4. Repealing Clause. All laws, decrees, executive
orders, rules and regulations inconsistent herewith, are hereby
repealed or modified accordingly.

SECTION 5. Separability Clause. If any provision of this Act is
held invalid or deciared unconstitutional, the other provisions which
are not affected thereby shall remain valid and subsisting.

SECTION 6. This Act shall take effect fifteen (15) days after
its complete publication in the Official Gazette or in two (2)

newspapers of general circulation, whichever comes first.

Approved,