Question & AnswerQ&A (ADMINISTRATIVE ORDER NO. 5, S. 2001, MARCH 8, 2001)
The Agricultural Competitiveness Enhancement Fund (ACEF) is a fund created to implement policies replacing quantitative import restrictions on agricultural products (except rice) with tariffs. It consists of duties collected from agricultural product importations under the minimum access volume mechanism, loan repayments, and interests, which is used to support farmers, fisherfolk, and agri-based enterprises for productivity, research and development, and educational grants.
The ACEF consists of all duties collected from the importation of agricultural products under the minimum access volume (MAV) mechanism, including unused balances and collections from repayments from loan beneficiaries including interests, if any.
The ACEF shall continue to be set aside up to the year 2022, after which the collection of duties from the MAV mechanism and the setting aside of the amount collected shall terminate.
The ACEF is automatically credited to Special Account 183 in the General Fund of the National Treasury.
The ACEF funds are set aside and released for: (a) increasing productivity of farmers and fisherfolk through credit for acquisition of production and processing machinery and farm inputs, (b) research and development on agricultural and fishery products of state universities and colleges, and (c) a grant-in-aid program for agriculture, forestry, fisheries, and veterinary medicine education implemented by the Commission on Higher Education.
The Land Bank of the Philippines manages the credit facility funded out of the ACEF, determining eligibility requirements, setting loan security or collateral and reasonable interest rates, and charging a management fee.
The loan amount shall not exceed Five million pesos (P5,000,000.00) per project loan for associations and cooperatives, and One million pesos (P1,000,000.00) for individual farmers and fishermen.
Loan beneficiaries must provide a counterpart fund or equity of not less than ten percent (10%) of the total project cost, which may be in the form of capital outlay, labor, land, facilities, equipment, or salaries.
The ACEF Executive Committee is composed of the Secretary of Agriculture (chair), President of the Land Bank of the Philippines, Chairperson of the Commission on Higher Education, a representative of farmers associations and cooperatives, and a representative of fisherfolk associations and cooperatives. The Committee promulgates policies and guidelines for planning, administration, coordination, and monitoring of ACEF utilization.
Within 120 days from the approval of the Act, reports on duties collected, funds credited, and funds released must be submitted to the ACEF Executive Committee and COCAFM. The Commission on Audit (COA) conducts a full audit of ACEF grants and loans and reports to the Office of the Solicitor General (OSG) for legal collection actions. The OSG submits collection performance reports every six months.