National Rice and Corn Corp. creation and powers

Policy for development and stabilization

Section 2 requires the Corporation’s development work to be carried out through education, inducements, and actual practical demonstrations.
Section 2 requires development to promote initiative and cooperation among the people and to provide facilities and guidance with help from existing Government agencies and private institutions.
Section 2 requires the Corporation’s stabilization work to maintain a stable price consistent with the average cost of production, the purchasing power of the people, and the national economic policy of the Government.
Section 2 requires stabilization to prevent speculation in trading and exploitation of the consumers.
Section 2 requires stabilization through financing producers of raw products and other industry activities needing such assistance.
Section 2 directs the Corporation to study, promote, and execute measures to improve quality and unit yield, and to improve and reduce costs of production, handling, storage, conservation, processing, transportation, and general trading of rice, corn, and by-products.
Section 2 directs the Corporation to study, promote, and establish industries that make the most use of by-products and produce commodities of economic importance.
Section 2 directs the Corporation to study, promote, and execute measures to improve rice and corn’s nutritive value and assimilability, and their by-products.
Section 2 directs the Corporation to study, promote, and execute measures to solve problems arising from over production of rice and corn.
Section 2 requires promotion of economic and social conditions of producers through general agricultural development, industrialization of agricultural products, promotion of home industries in producing regions, and promotion of cooperative associations among producers.

Corporate authority and powers

Section 3 authorizes the Corporation to act as agent or instrumentality of the Government in governmental, social, or civic functions under conditions prescribed by law or executive order or proclamation.
Section 3 authorizes the Corporation to buy, sell, import, export, deal in, barter, exchange, and handle rice and corn and their by-products.
Section 3 authorizes the Corporation to own, lease, operate, or otherwise hold—subject to existing laws—transportation means (including trucks and railway lines), elevators, mills, factories, irrigation systems, power plants, machinery and equipment, and warehouses and structures for protection, storage, handling, processing, utilization, and sale of rice, corn, other agricultural products, and other commodities needed for development.
Section 3 authorizes the Corporation to give loans on reasonable terms and to finance activities in the rice and corn industries.
Section 3 authorizes borrowing/raising/ securing money, and mortgaging or encumbering corporate property or otherwise giving security.
Section 3 authorizes contracts of every class and description necessary or incidental to the Corporation’s purposes with any person, firm, corporation, private or public, and with any foreign government.
Section 3 authorizes having one or more offices outside the Philippines and to conduct business and exercise powers anywhere in the Philippines and in any foreign country, State, or territory.
Section 3 authorizes research on industrialization, conservation, and better utilization of agricultural products.
Section 3 authorizes study and promotion of home industries among families engaged in rice and corn production.
Section 3 authorizes eminent domain in the name of the Republic of the Philippines, with title to acquired real estate taken in the name of the Republic and then entrusted to the Corporation as agent to accomplish Act purposes.
Section 3 restricts eminent domain use to situations where the Corporation has completely failed to purchase the real estate at a price deemed reasonable by the Board of Directors.
Section 3 authorizes procuring and selling or donating fertilizers and lime, distributed fairly and equitably through provincial demonstration agents, the Department of Agriculture, agricultural college, or as the Board directs, for experimentation, education, and introduction of use in cooperation with practical farmers to obtain information on value, effect, and best methods of use.
Section 3 authorizes establishing demonstration farms and arranging with farmers and farm organizations for large-scale practical use of fertilizers and lime under conditions allowing accurate measurement of economic return, with a requirement that farmers and farm organizations keep records of farm methods and performance open to the public.
Section 3 authorizes cooperation with national, provincial, and school experimental stations or demonstration farms, and with farmers, landowners, tenants, and associations of landowners and tenants, for use of fertilizers and lime/fertilizing and liming practices and for promoting prevention of soil erosion by use of fertilizers or otherwise.
Section 3 authorizes requesting assistance and advice of officers, agents, or employees of any Executive Department or independent office to enable the Corporation to carry out its powers successfully and to utilize services of such personnel.
Section 3 provides that if public interest, service, or economy so require, the President of the Philippines may direct that assistance be rendered, and individuals directed by the President become subject to the Corporation’s orders, rules, and regulations.
Section 3 declares that any invention or discovery made by virtue of and incidental to such Government service, together with patents granted thereon, is the sole and exclusive property of the Corporation, which may grant licenses under terms authorized by the Board of Directors.
Section 3 allows the Corporation to pay inventors a sum from income from the sale of licenses as it deems proper.
Section 3 authorizes taking measures to improve economic and social conditions of rice and corn producers and authorizes doing all other acts incidental or conducive to the Corporation’s purposes, including exercising powers a natural person may do and exercise when authorized by law.

Relationship with corporation law

Section 4 subjects the Corporation to the provisions of the Corporation Law insofar as compatible with the Act.
Section 4 grants the Corporation the general powers mentioned in the Corporation Law in addition to the powers specified in the Act.

Exemptions, assignments, and inspection powers

Section 5 exempts the Corporation from import duty on rice and corn and on supplies, machinery, and equipment such as fertilizers and lime necessary for demonstration farming.
Section 5 exempts the Corporation from payment of sales and milling taxes imposed or to be imposed by the National Government or any provincial or municipal governments.
Section 5 authorizes the President of the Philippines to further exempt the Corporation from payment of other taxes whenever the President considers such exemption is for public interest.
Section 5 authorizes the President to transfer and assign to the Corporation specified Government parcels of land in the City of Manila, bounded on three sides by Azcarraga Street, Quezon Boulevard, and Evangelista Street, specifically Lots Nos. 1, 2, 3, 4, 5 & 6, Block 2181, containing 9,398 square meters, and such other real or personal property as the President deems necessary and proper for Corporation purposes.
Section 5 authorizes the Corporation to inspect and take records of palay, rice and corn stocks stored by any person, partnership, or corporation, and to enter premises where these commodities are found for inspection and record-taking.

Merit-based staffing and Board discipline

Section 6 prohibits political tests or qualifications from being permitted or considered in appointments of officials, selection of employees, and promotions in the Corporation.
Section 6 requires appointments and promotions to be based on merit and efficiency.
Section 6 requires removal by the President of the Philippines of any Board member found guilty of violating the political test rule.
Section 6 requires removal by the Board of any appointee of the Board found guilty of violating the political test rule.
Section 6 requires the Board of Directors to establish and prescribe its own rules, regulations, standards, and records for employment, promotion, demotion, removal, transfers, welfare, compensation, and appraisal of performance.
Section 6 requires the Board to provide a system of organization to fix responsibility and promote efficiency.

Capital stock and government ownership

Section 7 establishes the Corporation’s capital stock at twenty million pesos divided into two hundred thousand shares with a par value of one hundred pesos each.
Section 7 requires all stocks to be subscribed by the Government of the Republic of the Philippines, except such number of shares as may necessarily be sold to members of the Board of Directors.
Section 7 requires payment of subscriptions as follows: 50% immediately, 10% on or before July, 1951, 10% on or before July 1, 1952, and 10% on or before July 1, 1953.
Section 7 provides that payment of the remaining balance is subject to call by the President of the Philippines upon recommendation of the Board of Directors.
Section 7 provides that shares sold to any Board member may be purchased by the Government at par value when the person ceases to be a member of the Board.
Section 7 vests voting power of Government-owned shares in the President of the Philippines or persons the President designates.

Accounting, procurement, audit, and reporting

Section 8 requires the Corporation to maintain complete and accurate books of accounts segregated into three main accounts: Account No. 1 (stabilization of prices), Account No. 2 (developing and improving production), and Account No. 3 (promoting economic and social conditions).
Section 8 requires the Board of Directors to submit annual reports and balance sheets to the President of the Philippines and to Congress as provided for in section five hundred and seventy-four to five hundred and seventy-seven of the Administrative Code.
Section 8 requires that all purchases and contracts for supplies or services (except personal services) made by the Corporation be made after advertising, in a manner and with timing sufficiently in advance of bid opening as the Board determines adequate to ensure notice and opportunity for competition.
Section 8 allows purchases/contracts without public bidding when: (1) an emergency requires immediate delivery or performance; (2) repair parts/accessories/supplemental equipment or services are required for supplies or services previously furnished or contracted for; or (3) the aggregate amount involved does not exceed P1,000, in which case open market procurement is allowed in a manner common among businessmen.
Section 8 authorizes bid comparisons and awards to consider relative quality and adaptability, bidder financial responsibility, skill/experience/record of integrity, ability to furnish repairs and maintenance services, time of delivery/performance, and bidder compliance with specifications.
Section 8 allows purchases without public bidding from a government—domestic or foreign—if the Board is satisfied that the Government price is the lowest possible considering quality and period of delivery.
Section 8 requires the Auditor General to audit Corporation transactions at times he determines, but not less frequently than once each governmental fiscal year, using personnel of his selection.
Section 8 gives the Auditor General and representatives free and open access to all papers, books, records, files, accounts, plants, warehouses, offices, and all other things, property, places under the Corporation’s control, and used or employed by the Corporation, and requires full facilities for counting cash and verifying transactions and balances in depositaries.
Section 8 requires a report of each audit in quadruplicate: one for the President, one for the Chairman of the Board, one for public inspection at the principal office, and one retained by the Auditor General for Congress.
Section 8 prohibits issuance of the audit report until the Corporation is given a reasonable opportunity to examine exceptions and criticisms, explain or answer them, and file a statement submitted with the Auditor General’s report.
Section 8 requires payment of audit expenses from appropriations for the General Auditing Office, and requires the Corporation to promptly reimburse the allocated portion as billed by the Auditor General.
Section 8 requires the Auditor General to make special reports to the President and Congress of any transaction or condition found to be in conflict with the Corporation’s legal powers or duties.

Governance structure and terms

Section 9 vests management in a Board of Directors of five members appointed by the President of the Philippines with the consent of the Commission on Appointments.
Section 9 requires the President to appoint the Chairman of the Board from among Board members.
Section 9 allows the Board to appoint a General Manager and Assistant General Manager, who need not be Board members.
Section 9 sets initial terms by designation: one director for one year, one for two years, one for three years, one for four years, and the chairman for five years; thereafter, each appointed director serves for five years.
Section 9 provides that a vacancy is filled by an appointee who serves only for the unexpired term of the member being replaced.
Section 9 requires three members of the Board to constitute a quorum for transacting business.
Section 9 makes all Board directors subject to removal by the President of the Philippines.
Section 9 requires Board members to be persons who profess a belief in the feasibility and wisdom of the Act.

Dissolution of predecessor and succession

Section 10 dissolves the present National Rice and Corn Corporation merged with PRISCO by Executive Order No. 350.
Section 10 transfers to and vests in the new Corporation the dissolved entity’s properties, assets, rights, choses in action, obligations, liabilities, and contracts.
Section 10 provides that the dissolved corporation’s business and affairs are liquidated as of the Act’s effective date and automatically assumed and continued by the new Corporation.
Section 10 requires that the dissolved corporation’s net book value of properties and assets on the effective date be received by the new Corporation as payment for an equal value of shares of the new Corporation’s capital stock.
Section 10 provides that references in any Act or Executive Order or Proclamation still in force to the National Rice and Corn Corporation are deemed references to the Corporation created under this Act.

Appropriation, capitalization, and profits

Section 11 appropriates from National Treasury funds not otherwise appropriated amounts to be paid and transferred to the Corporation for Government subscription of capital stock, subject to a total ceiling of twenty million pesos.
Section 11 requires payment timing and amounts as follows: ten million pesos upon approval, with five million pesos taken from PRISCO’s authorized capital appropriation as PRISCO share in RICO Department activities assumed and continued by the new Corporation, and five million pesos less the net book value of properties and assets of the former National Rice and Corn Corporation on or before July 1, 1952.
Section 11 requires the balance of five million pesos to be paid on or before July 1, 1953.
Section 11 requires that all profits derived from operating the Corporation accrue to and form part of the Corporation and be available for expenditure and/or investment for the same purposes under the Act.

Effectivity

Section 12 provides that the Act takes effect one month after its approval.
Approved date is June 16, 1951.