QuestionsQuestions (EXECUTIVE ORDER NO. 341)
The IRR is issued pursuant to Section 28 of RA 11293. It was promulgated by NEDA, in coordination with DOST and DTI, under Joint NEDA-DOST-DTI Administrative Order No. 2, s. 2020.
Rule 2 declares the State policy to foster innovation as vital to national development and sustainable growth, citing Section 10, Article XIV of the Constitution on the priority given to R&D, invention, innovation, and their utilization.
Under Rule 3(g), innovation is the creation of new ideas leading to development of new or improved products, processes, or services, and then their spread or transfer across markets.
Product innovation is a new or significantly improved good/service by features or intended use; process innovation is a new or significantly improved production/delivery method; organizational innovation is new or significantly improved business practices, workplace organization, or external relations.
Rule 17 requires cross-government coordination across policy areas (education, health, energy, industry, etc.) with engagement of business, RD&E sector, and communities. It requires a joint web portal for public access and streamlined online services, plus periodic progress reporting to the NIC.
The NIC is the policy advisory body tasked with formulation, development, implementation, and monitoring of the country’s innovation goals, priorities, and long-term strategy.
The Executive Members come from business/entrepreneurs, academe, and scientific community, with at least one woman. There must be at least one MSME representative and one large enterprise representative, both recommended by legally established business organizations. Academe/scientific members must have at least seven years of experience in relevant fields.
Rule 7 includes strategic vision/goals, policy coherence, monitoring programs, metrics, annual Congress reporting, and establishing/administering the Innovation Fund, including screening/approving qualified programs and creating committees as needed.
The Secretariat is within NEDA, headed by an Executive Director III (Salary Grade 28) appointed by the President, under supervision/control of the Secretary of Socioeconomic Planning. The Executive Director III must have at least seven years of experience in science/technology, R&D, MSME, innovation, finance, or business management.
Under Rule 9, the NIASD provides a road map for innovation governance improvements via policy coordination, inclusive innovation efforts (including poorest-targeted programs), public-private partnerships, empowerment of HEIs, and IP creation/protection/commercialization. It must be completed within six (6) months from the IRR/Act effectivity, include innovation priority areas and strategies, and have at least a ten-year horizon (review every five years).
Rule 10 lists areas such as food security and sustainable agriculture, blue economy, education/academe, health, renewable energy, climate/disaster resilience, resource efficiencies, regional comparative advantages in global value chains, traditional knowledge/TCE/genetic resources, infrastructure, governance, human capital, digital economy, transportation services, and other relevant areas.
Inclusive innovation (Rule 3(f)) is the creation of new ideas that develop new/improved products/processes/services creating value and improving welfare of low-income and marginalized groups. Rule 11 requires the NIC to develop strategies to promote participation of different sectors in creation of such ideas aimed at improving welfare and livelihood/entrepreneurship opportunities.
Rule 12 requires strategies for MSME internationalization, digitalization, and participation in local/global value chains, including coaching/mentoring (design, quality, IP, commercialization, etc.). PSA with DTI-BSMED must collect timely MSME data by asset size and other indicators. Implementing agencies must annually report implementation status/challenges/accomplishments vis-à-vis NIC-approved targets.
The Innovation Fund supports entrepreneurship and enterprises developing innovative solutions benefiting directly or indirectly the poorest of the poor. It is administered by the NIC, which screens and approves proposals, and it is initially allocated a revolving fund under conditions stated in the IRR and later included in annual General Appropriations.
All banking institutions must set aside at least 4% of total loanable funds for innovation development credit (subject to defined conditions). The BSP imposes administrative sanctions/penalties for noncompliance/under-compliance, computed at 0.5% of the amount, directed towards innovation development, with 90% going to the Innovation Fund and 10% retained by BSP for administrative expenses.
Rule 26 requires procurement under RA 9184 while allowing innovation-stimulating guidelines by the NIC with GPPB. It mentions innovative goods and services, pre-commercial procurement (multi-stage process), and technology diffusion procurement to accelerate diffusion/market transformation, including use of project-based competition.
Rule 24 requires reforms so applications for starting a business and renewal of licenses are processed within three (3) working days from receipt, and other permits/clearances and patent-related applications are streamlined. The NIC develops guidelines and coordinates with DBM, GPPB, CSC, PRC, and COA for more flexible approaches consistent with law and for innovation-friendly budgeting/procurement/auditing.
Rule 29 states that failure to carry out provisions of the Act is a ground for filing criminal or administrative cases under the Administrative Code of 1987, RA 6770 (Ombudsman Act), RA 673 (Code of Conduct), RA 3019 (Anti-Graft), RA 7160 (LGC), and Act No. 3815 (Revised Penal Code), among others.