Duties and Functions of NACIDA
- Organize, revive, encourage, and promote cottage industries; absorb existing government projects and resources related to cottage industries.
- Survey and evaluate available skills, machinery, equipment, and raw materials in industrial quantities.
- Promote effective merchandising of cottage products domestically and internationally; may directly market products.
- Standardize cottage products and prescribe grading, classification, and inspection rules, especially for exports.
- Grant or arrange small loans to cottage industries including those for raw materials production.
- Provide assistance in financing, production, and marketing problems.
- Offer consultation, technical know-how, and field assistance.
- Undertake research and training to improve products.
- Maintain a tool and die development program.
- Adopt necessary measures to fulfill the Act's purposes.
General Powers of NACIDA
- Authorized to enter into contracts; lease, own, or dispose of properties; sue or be sued.
- Prescribe necessary rules and regulations for its functions.
- Manage expenditures and acquire assets relevant or incidental to its operations.
- Rules published in a newspaper become effective after fifteen days.
Board of Directors' Powers and Duties
- Fix compensation and determine the number of officers and employees.
- Approve the annual and supplemental budgets.
- Enunciate guiding policies for the Board’s operations.
Managing Head: Administrator
- Administrator and Deputy Administrator appointed by the President with Commission on Appointments' consent.
Powers and Duties of the Administrator
- Manage Board affairs following Board policies.
- Submit annual budget before each fiscal year to the Board of Directors.
- Appoint subordinate officials and employees; supervisory appointments subject to Board confirmation.
- Submit annual report after fiscal year detailing activities, financial condition, problems, recommendations, and future programs.
- Perform other duties assigned by the Board.
Regional Institutes
- At least nine institutes established in various Philippine regions to conduct research, standardize products, and determine commercially viable cottage products.
- Each headed by a Director appointed by the President with Board recommendation.
Funding
- Initial appropriation of four million pesos.
- Ongoing funding through General Appropriation Acts.
Priority in Government Procurement
- Within one year of NACIDA’s organization, cottage industry products listed and samples furnished to the Bureau of Supply.
- Bureau of Supply prioritized in purchasing these cottage products for government use.
Loan Assistance
- Development Bank of the Philippines and Philippine National Bank allocate fifty million pesos each for loans to cottage industries.
- Mortgage or pledge on cottage products accepted as loan security.
- Loans have interest caps of four percent annually.
- Real property without Torrens Title may be accepted as loan security.
Definition of Cottage Industry and Products
- Cottage industry refers to small-scale economic activities primarily done at home involving family members.
- Includes a comprehensive list of crafts, agriculture, manufacturing, and other related activities (e.g., fiber crafts, woodcraft, metalwork, ceramics, textile weaving, poultry, piggery, food preservation, and others).
- Must be Filipino-owned and operated; corporations/cooperatives require at least 75% Filipino ownership.
- Cottage products must be labeled as "Cottage Products-Made in the Philippines."
Registration and Compliance
- Persons or entities desiring benefits must register with NACIDA.
- Non-compliance with Board rules disqualifies them from benefits and assistance.
Export Restrictions on Raw Materials
- Export of local raw materials needed for cottage industries is prohibited until local demand is met.
Producers and Marketing Cooperatives
- NACIDA stimulates organization, establishment, and management training for cooperatives supporting cottage industries.
Priority in Capital Goods and Studies
- Reparations Commission allocates priority for capital goods and field studies certified by NACIDA.
Tax Exemptions
- Production, manufacture, and sale of cottage products exempt from all taxes for five years from registration date.
Penalties
- Misuse of borrowed funds under this law punishable by one-year imprisonment and a two-thousand peso fine.
Repealing Clause
- All laws inconsistent with this Act are repealed or modified accordingly.
Effectivity
- The Act takes effect immediately upon approval.