Question & AnswerQ&A (Republic Act No. 3470)
The main purpose of Republic Act No. 3470 is to create the National Cottage Industries Development Authority (NACIDA) under the Department of Commerce and Industry, to promote the development, organization, and assistance of cottage industries in the Philippines.
NACIDA is composed of a board consisting of a chairman and four members, including the Chief of the Division of Home Industries of the Bureau of Public Schools. The chairman and members are appointed by the President with the consent of the Commission on Appointments for a term of six years.
Any person who simultaneously serves as a director of a government-owned or controlled corporation, or who is a candidate for a public elective office at the time of appointment or was a candidate in the immediately preceding elections, is ineligible for appointment.
NACIDA is tasked to organize, promote, and develop cottage industries, survey available local resources, assist in marketing, standardize cottage products, grant small loans, provide technical assistance, conduct research and training, and adopt measures necessary to fulfill its objectives.
The Board of Directors can fix compensation and number of employees, approve the budget, set operational policies, and ensure the authority carries out its duties effectively.
A cottage industry is a small-scale economic activity conducted mainly in homes or other places for profit, often involving family members, and includes various crafts, agricultural activities, food preservation, small-scale manufacturing, and related activities conducted with manual or electrical gadget assistance.
Cottage products are the products produced by cottage industries and are required to be labeled as 'Cottage Products - Made in the Philippines.'
Any person who uses loan funds for purposes other than those applied for shall face imprisonment for one year and a fine of two thousand pesos.
They are exempt from all taxes for a period of five years from the date of registration with the Board.
The regional institutes conduct research, determine appropriate cottage industry products for their regions, standardize products, and perform functions assigned by the Secretary of Commerce and Industry to promote cottage industries effectively in various regions.
Loans can be secured with a guaranty of mortgage, pledge on cottage products, or real estate even without Torrens Title. Interest on such loans is limited to a maximum of four percent annually.
Export of local raw materials needed for cottage industries is prohibited until local demands are met to ensure sufficient supply for the development of these industries.
An initial fund of four million pesos was appropriated, with subsequent funds to be included in the annual General Appropriation Acts.
They are appointed by the President with the consent of the Commission on Appointments. The Administrator's salary is fifteen thousand pesos per annum, while the Deputy Administrator's salary is twelve thousand pesos per annum.
At least seventy-five percent of their capital, stockholders, and all board members must be Filipino citizens.