Question & AnswerQ&A (Republic Act No. 6810)
Republic Act No. 6810 is officially titled as the "Magna Carta for Countryside and Barangay Business Enterprises (Kalakalan 20)."
The policy declared in RA 6810 is that growth of countryside business enterprises shall be achieved through the absence of bureaucratic restrictions and granting of incentives and other benefits.
A CBBE is any business entity, association, or cooperative registered under RA 6810 which has no more than twenty (20) employees; undertakes a productive business enterprise recommended by the DTI provincial office (excluding certain activities like professional services, retailing, wholesaling or trading); has assets not exceeding P500,000 before financing; and has principal office and business operations located in the countryside as defined by the DTI.
Business enterprises engaged principally in professional services, retailing, wholesaling or trading of commodities, products, or merchandise are excluded.
The registration fee for a CBBE is Two hundred and fifty pesos (P250.00), collected by the municipality or city where the principal place of office and business operations are located to cover issuance of the license to operate known as the CBBE authority.
CBBEs are exempted from all taxes, national or local, license and building permit fees, business taxes except real property and capital gains taxes, import duties, and taxes on imported articles. Income, receipts, and proceeds from CBBE operations are excluded from the gross income for individual income tax computation. They are also exempt from government rules and regulations regarding assets, income, and activities indispensable to the enterprise.
The fees are based on net assets before financing: P1,000 for assets up to P100,000; P2,500 for assets over P100,000 to P250,000; P4,000 for assets over P250,000 to P400,000; and P5,000 for assets over P400,000 to P500,000.
A CBBE has a separate and distinct juridical personality from its owners or members, allowing it to own, dispose, and encumber properties, enter into contracts, sue and be sued, and transact business anywhere in the country.
Any person who willfully violates any provisions may be fined not less than One thousand pesos (P1,000) nor more than Ten thousand pesos (P10,000). If the violation is also punishable under another law with a heavier penalty, the heavier penalty applies. Public officials committing violations are prosecuted under applicable laws.
All exemptions and benefits can be forfeited after due notice and hearing if the CBBE or any of its officers or authorized representatives violate provisions of RA 6810.
The CBBE authority shall be revoked and cancelled after due notice and hearing if the CBBE, without valid reasons, fails to commence operations within forty-five (45) days.
The exemptions and benefits apply for a period not exceeding five (5) years from the date of registration, granted the CBBE is registered within five (5) years from the effectivity of the Act.
The Secretary of Trade and Industry, in consultation with relevant government departments and local government units, shall formulate and prepare necessary rules and regulations to implement the Act within 120 days, and issue rules that take effect fifteen days after publication and notice.
Yes, but the brand name must first be registered with the Bureau of Domestic Trade, through the DTI provincial office.
The collected CBBE fees accrue exclusively to the municipality or city and are to be used for developmental projects approved by the municipal or city council.