Statutory basis and predecessors amended
- Presidential Decree No. 652 amends Republic Act No. 3099 which had created the Bureau of Fiber Inspection Service.
- Presidential Decree No. 652 reorganizes the Bureau and substitutes its name to the “Bureau of Fiber Development and Inspection Service.”
- Presidential Decree No. 652 references Republic Act No. 3099 as amended through this reconstitution.
- Presidential Decree No. 652 ties spending rules for its special fund to Section 7-1(4) of Commonwealth Act No. 246, as amended.
- Presidential Decree No. 652 provides a specific exemption linked to Presidential Decree 175 and Letter of Implementation 23 for cooperatives.
Policy purpose and objectives
- Presidential Decree No. 652 directs that Republic Act No. 3099 be updated to maximize returns of fiber producers’ investments.
- Presidential Decree No. 652 establishes a more equitable distribution of income and wealth in the fiber industry.
- Presidential Decree No. 652 requires stricter qualitative and quantitative government control of fibers for export and local consumption.
- Presidential Decree No. 652 promotes increased government revenues through income-earning agencies and expansion and rationalization of abaca and other fiber industries.
- Presidential Decree No. 652 empowers the Bureau to stabilize markets and improve fiber quality through classification, grading, inspections, and research.
Bureau reorganization and offices
- The Bureau of Fiber Inspection Service is reconstituted and renamed “BUREAU OF FIBER DEVELOPMENT AND INSPECTION SERVICE.”
- The Bureau operates under the direct supervision of the Department of Trade.
- The Secretary of Trade must organize the Bureau upon issuance, following a reorganization plan to be submitted for approval by the President.
- The Bureau is headed by a Director and an Assistant Director appointed by the President, with corresponding salaries for Bureau Directors and Assistant Directors.
- The Bureau’s main office is in Manila or suburbs, and it has regional offices and appropriate representative offices outside the Philippines as necessary.
Powers and functions of the Bureau
- The Bureau must maintain and enforce a uniform and standard classification of abaca and other Philippine commercial fibers intended for export and local consumption.
- The Bureau must determine official standards for commercial fibers produced in the Philippines for local consumption and exports.
- The Bureau must classify grading establishments based on the number of bales pressed per annum.
- The Bureau must issue grading permits to persons or entities engaged in grading and baling fibers for local consumption or export after they prove necessary qualifications, subject to annual fee requirements.
- The Bureau must maintain adequate equipment and facilities for accurate determination of fiber color values, breaking strength through pull, doubling, abrasion, knotting, and other forms of wear and tear.
- The Bureau must use fiber for local manufacturers and home industry as a means to stabilize the market and ensure more adequate returns for fiber producers.
- The Bureau must regulate and control grading and baling establishments.
- The Bureau must gather and collate data on fiber balings and shipments by grade, district of production, port of destination, and price to guide producers on in-demand grades in local and foreign markets.
- The Bureau must observe fiber trading and traffic of loose commercial fibers in fiber-producing regions and prevent misdeclaration of origin of production.
- The Bureau must conduct systematic and intensive campaigns to improve fiber quality and production methods.
- The Bureau must conduct foreign market surveys for establishment or expansion of export markets.
- The Bureau must conduct scientific, industrial, and economic research on abaca and other fibers to expand their utilization for local and foreign uses.
- The Bureau may conduct other activities necessary or incidental to attain its purposes.
- The Bureau may formulate rules and regulations subject to the approval of the Secretary of Trade to carry out its functions.
Mandatory grading, baling, inspection, certification
- Fibers with official standards established must be graded, baled, inspected, approved, and certified under the decree’s system.
- No fiber may be consumed locally or exported from the Philippines in any quantity without first being graded, baled, inspected, and certified.
- For fiber for domestic utilization, baling may be optional.
Inspections and fee requirements
- Inspectors (or other authorized persons) have free access to grading and baling sheds and warehouses of any grading establishment within their jurisdiction to inspect propriety of methods used.
- Inspectors must ensure that approved standards are maintained and renewed within a specified period.
- The Bureau must levy and collect inspection fees (subject to approval of the Secretary of Trade) by itself or authorized agents.
- Inspection fees must be not less than PHP 6 nor more than PHP 50 for each bale of fiber inspected and stamped, whether the bale is approved or rejected.
- Different rates of inspection fees may be fixed for other Philippine commercial fibers.
- With the Secretary of Trade’s approval, inspection fees may be adjusted or modified at any time by the Bureau Director, within the limits fixed in the decree (PHP 6 to PHP 50 per bale).
Grading permits, annual fees, and exemptions
- Grading and baling permits are issued only to qualified persons or entities engaged in grading and baling fibers for local consumption or export.
- Permit-holders must pay in advance an annual fee based on grading establishment class:
- First Class: PHP 5,000.00
- Second Class: PHP 4,000.00
- Third Class: PHP 3,000.00
- Fourth Class: PHP 1,000.00
- Those engaged in buying and selling Philippine commercial fibers, and those engaged in sorting, classifying, and bundling loose Philippine commercial fibers below the category of fourth class establishments must pay an annual fee of PHP 200.00, payable semi-annually.
- The classification includes planters who buy the share of tenants from the produce of their plantations.
- Cooperatives falling under Presidential Decree 175 and Letter of Implementation 23 are exempt from payment of the permit fee for 10 years from the date of their organization.
- Classifiers in duly licensed grading-baling establishments and/or trading establishments, and industrial firms engaged in processing such fibers into semi-finished or finished products, must pay a minimal fee of Ten Pesos per annum, payable in advance, to the Bureau.
Special fund for fiber development
- Inspection fees collected by the Bureau and other income accruing to the Bureau constitute a special fund called “Fiber Development and Inspection Fund.”
- The special fund may be spent only pursuant to a special budget approved by the President as required by Section 7-1(4) of Commonwealth Act No. 246, as amended.
- Not more than 40% of the appropriation in any fiscal year may be spent for personal services and operational expenses, including furniture and equipment.
- Unexpended balances do not revert to the General Fund; they continue to form part of the special fund available for reappropriation in the ensuing fiscal year.
Criminal and administrative penalties
- The Bureau may cause the cancellation of the grading permit issued to a grading-baling establishment if the establishment fails to conduct grading and baling operations in accordance with the decree and Bureau rules and regulations.
- The individual responsible for violation of any provision of the decree or Bureau rules and regulations is punishable by:
- imprisonment of not less than six years nor more than ten years, or
- a fine of not less than Five Thousand Pesos nor more than Fifteen Thousand Pesos, or
- both fine and imprisonment, at the discretion of the Court.
- For violations committed by a corporation, association, partnership, or firms, the penalty is imposed on the president, partner, manager, or principal officer.
- If the offender is a naturalized citizen, the offender suffers:
- the prescribed penalty, and
- cancellation of the naturalization certificate, registration in the civil registry, and immediate deportation after serving completely the sentence.
- If the offender is an alien, the offender suffers immediate deportation after serving completely the sentence.
- If the offender is a public officer or employee, the offender is dismissed from office and perpetually disqualified from holding public office, in addition to imprisonment and fine.
Appropriations, transfers, and personnel
- PHP 2,000,000 is appropriated out of National Treasury funds not otherwise appropriated to carry out the decree, or so much thereof as may be necessary.
- Unexpended appropriations available for transfer from the current appropriation of the Philippine Bureau of Standards are transferred to the Bureau of Fiber Development and Inspection Service to carry out the purposes of the decree.
- Thereafter, amounts necessary for the Bureau’s purposes are included in the annual general appropriations decree.
- Personnel of the former Bureau of Fiber Inspection Service necessary for the Bureau, including pertinent properties, records, assets, and liabilities, are transferred to the Bureau.
- Personnel not absorbed by the new agency must retire under existing retirement laws if qualified; otherwise, they receive separation pay at one month’s salary for every year of service, based on the highest salary received, but not to exceed twelve months.
Repeal and effectivity rules
- All acts, decrees, executive orders, administrative orders, rules and regulations, proclamations, or parts thereof inconsistent with Presidential Decree No. 652 are repealed or modified accordingly.
- Presidential Decree No. 652 takes effect immediately.