Filipino Retailers' Fund Creation Act

Section 2 creates a revolving fund known as the “Filipino Retailers’ Fund.”
Section 2 places the Fund under the administration of the Secretary of Commerce and Industry, or any other office the President may designate.
Section 2 designates provincial, city, and municipal treasurers as the Secretary’s deputies.

Section 3 requires importers of prime commodities to sell to Filipino retailers at the same mark-up as their sales through existing trade channels.
Section 3 mandates that at least 30% of imports be sold to Filipino retailers.

Section 4 directs that the Fund be used either:
- as a guarantee fund to underwrite loans made by any government financing institution to any bona fide Filipino retailer, or
- as a loan fund.
Section 4 limits cash loans: not more than 20% of the Fund’s monies may be given as cash loans.
Section 4 authorizes cash loans only up to PHP 5,000 each to:
- a Filipino citizen who fully owns a retail store and personally manages it; or
- a Filipino citizen who wishes to be a retailer.
Section 4 requires payment of loans in five equal annual installments with interest at 4% per annum.
Section 4 prohibits collecting interest in advance.
Section 4 requires mortgaging the retail store assets—owned by the retailer or to be established by him—to the Filipino Retailers’ Fund to secure loan payment.

Section 5 requires the Fund to assist in the promotion and development of the Filipino retail trade.
Section 5 authorizes the Fund to help Filipino retailers secure liberal credit facilities.
Section 5 empowers the Fund to provide technical assistance, including teaching merchandising techniques and skills.
Section 5 states the Fund’s general purpose: equipping Filipino retailers with tools to compete more effectively with aliens in retail, enabling Filipino merchants to wrest control of an important phase of the national economy from foreigners.

Section 6 requires applications for loans to be:
- made in writing, and
- made under oath.
Section 6 requires the application to include a statement that the retailer is of good moral standing in the community and that he has not been convicted previously of estafa or any other crime involving moral turpitude.
Section 6 requires a statement that loan proceeds will be used solely for purchasing articles needed for the retail business the applicant is engaged in or will engage in, and that those articles will be sold by the applicant at his retail store directly to the public.

Section 7 makes it unlawful to use loan proceeds (or any part of them) for any purpose other than the purposes set out in the application.
Section 7 provides that any violation constitutes sufficient cause for the recission of the contract.
Section 7 requires that upon recission, the balance of the loan and the interest thereon becomes immediately due and demandable.

Section 8 requires the Secretary of Commerce and Industry to issue the necessary rules and regulations to carry into effect the Act and to ensure stable and orderly management and success of Filipino retail stores.
Section 8 authorizes the Secretary to extend technical information or assistance to Filipino retailers to preserve, protect, and promote the Act’s objectives.
Section 8 requires that technical information or assistance be without cost to the retail store.
Section 9 creates a guidance division in the Department of Commerce and Industry.
Section 9 assigns the guidance division responsibility for:
- processing loans granted under the Act, and
- helping borrowers make purchases without unnecessary loss of time and/or money.

Section 10 appropriates PHP 20,000,000 out of any funds in the National Treasury not otherwise appropriated to constitute the revolving fund under Section 2.
Section 10 provides that all income or receipts derived from operating the revolving fund accrue to and form part of the same Fund.
Section 10 makes those income/receipts available for expenditure and/or investment for purposes of the Act.