Policy and program purpose
- Section 2 declares State policy to achieve sustainable modern agriculture and food security by helping agricultural and fishing communities reach their full potential.
- Section 2 directs the State to increase farmers’ and fishermen’s incomes and bridge gaps through public-private partnerships to improve quality of life.
- Section 2 requires strengthening farmers and fisherfolk enterprise development through a comprehensive and holistic approach.
- Section 2 requires consolidating roles of government agencies involved in enterprise development and intensifying the building of entrepreneurship culture among farmers and fisherfolk.
Program establishment and technology basis
- Section 3 establishes the “Farmers and Fisherfolk Enterprise Development Program” (the Program) as a comprehensive set of objectives, targets, and holistic approach.
- Section 3 provides that the Program promotes the establishment of enterprises involving agricultural and fishery products.
- Section 3 requires integration and consistency with the Agriculture and Fisheries Modernization Plan and the Micro, Small, and Medium Enterprises Development Plan.
- Section 3 requires the Program to use science-based technologies in identifying and prioritizing agricultural and fishery products to be covered.
- Section 3 defines the forms of assistance to include:
- improvement of production and productivity, including extension services, skills development, production inputs, equipment, facilities, and infrastructure for production and post-production (Section 3(a));
- improvement of access to financing through credit grants and crop insurance (Section 3(b));
- access to improved technologies through research and development (Section 3(c));
- business support and development services, especially access to markets, marketing, and networking (Section 3(d)).
Coverage of program areas
- Section 4 provides that the Program covers agricultural and fisheries enterprise-related areas, including:
- agricultural and fisheries production, including processing of fisheries and agri-based products and farm inputs (Section 4(a));
- acquisition of work animals, farm and fishery equipment and machinery (Section 4(b));
- acquisition of seeds, fertilizer, poultry, livestock, feeds, and other similar items (Section 4(c));
- procurement of agricultural and fisheries products for storage, trading, processing, and distribution (Section 4(d));
- construction, acquisition, and repair of facilities for production, processing, storage, transportation, communication, marketing, and other facilities supporting agriculture and fisheries (Section 4(e));
- working capital for agriculture and fisheries graduates to enable engagement in agriculture and fisheries related economic activities (Section 4(f));
- agribusiness activities supporting soil and water conservation and ecology enhancing activities (Section 4(g));
- working capital for long gestating projects (Section 4(h));
- credit guarantees on uncollateralized loans to farmers and fisherfolk (Section 4(i)).
Beneficiaries and eligibility conditions
- Section 5 identifies proponent groups or beneficiaries, including:
- existing producer groups whose products are included in priority commodity value chains and have potential to increase marketable surplus (Section 5(a));
- farmers and fisherfolk with potential to produce marketable surplus who demonstrate willingness to voluntarily adopt clustering and forge contracts or formal marketing agreements with buyers or private intermediaries (Section 5(b));
- producer groups or cluster of growers that are operational and/or show willingness to undergo capacity building on enterprise development and management (Section 5(c));
- micro, small, and medium scale processors, consolidators, exporters, and other enterprises willing to assist producer groups in vertical clustering or joint business planning and forge contracts or formal marketing agreements with producer groups (Section 5(d)).
- Section 5 requires that farmers and fisherfolk must be members of any organization operating in the priority commodity value chain to be eligible either:
- as members of the proponent group; or
- as suppliers to the enterprise (Section 5).
Implementing structure and councils
- Section 6 makes the Department of Agriculture (DA) the implementing agency of the Program.
- Section 6 requires the DA to tap assistance, expertise, and resources of specified agencies, including:
- Philippine Coconut Authority (PCA); National Dairy Authority (NDA); Bureau of Soils and Water Management (BSWM);
- Philippine Center for Post-Harvest Development and Mechanization;
- Bureau of Fisheries and Aquatic Resources (BFAR);
- Agricultural Training Institute (ATI);
- Agricultural Credit and Policy Council (ACPC); and
- Bureau of Agricultural Research (BAR) (Section 6).
- Section 6 requires the DA to collaborate with and secure technical support from other departments and attached agencies and corporations, including:
- Department of Agrarian Reform (DAR), Department of Environment and Natural Resources (DENR), Department of Science and Technology (DOST),
- Department of Trade and Industry (DTI), and Department of the Interior and Local Government (DILG) (Section 6).
- Section 8 creates the Farmers and Fisherfolk Enterprise Development Council to oversee proper implementation.
- Section 8 provides council composition:
- DA Secretary or duly authorized representative at least an Undersecretary as Chair;
- DTI representative at least an Undersecretary;
- DILG representative;
- Department of Finance (DOF) representative;
- Cooperative Development Authority (CDA) representative;
- representative of a national organization of farmers cooperatives or associations;
- representative of a national organization of fisherfolk cooperatives or associations; and
- two (2) representatives from the agriculture, food, restaurant and business sectors (Section 8).
- Section 8 requires counterpart funding from partner and local government units (LGUs) and farmers and fisherfolk organizations and enterprises in the form of cash, land, building, labor, or machineries and equipment.
Local councils and information system
- Section 9 provides that the Agriculture and Fishery Councils (AFOs) of the Philippine Council for Agriculture and Fisheries (PCAF) provide mechanisms for private sector participation in development processes at:
- regional,
- provincial,
- city/municipal levels (Section 9).
- Section 10 requires the DA, through the Agribusiness-and Marketing Assistance Service, to maintain a Farmers and Fisherfolk Enterprise Development Information System.
- Section 10 provides the Information System’s purposes:
- assist government in formulating plans and programs on enterprise development;
- enable producer groups, the private sector, LGUs, and potential donors to respond to local and world market needs;
- generate resources for further enterprise development (Section 10).
- Section 10 requires the Information System to contain:
- a list of possible and implemented programs and projects;
- a registry of agricultural and fisheries enterprises;
- a roster of private companies engaged in these enterprises or expressing interest in participating in the Program;
- other information identified by the Department or by the Council (Section 10).
Private sector partnerships and selection criteria
- Section 7 allows partnerships or alliances between farmers and fisherfolk and the private sector to improve market access of producer groups.
- Section 7 requires selection criteria for private sector partners to include:
- commitment to enter into marketing contract or buy-back agreement with the producers’ group (Section 7(a));
- willingness to undertake technology transfer on the provided goods and/or services (Section 7(b));
- financial and organizational capability to undertake the proposed enterprise (Section 7(c));
- established and actual experience in undertaking or implementing the proposed enterprise (Section 7(d)).
- Section 7 allows private sector partners to provide or donate equipment, machineries, and other assistance to farmers and fisherfolk engaging in enterprise development.
- Section 7 requires the DA to issue guidelines and qualification requirements for recognizing private sector partners of the Program.
Direct government purchase and procurement treatment
- Section 11 requires that to promote and support farmers and fisherfolk enterprise development, national and local government agencies shall directly purchase agricultural and fishery products from accredited farmers and fisherfolk cooperatives and enterprises.
- Section 11 limits the rule by requiring that the purchased products are necessary in the performance of the agencies’ respective mandates.
- Section 11 exempts procurement of such products by national and local government agencies from the bidding process under relevant government procurement laws.
- Section 11 requires that agencies shall undergo a negotiated procurement under the applicable guidelines of the Government Procurement Policy Board.
Tax incentives and exemptions
- Section 12 provides that, notwithstanding provisions of any general or special law to the contrary:
- gifts and donations of real and personal properties are exempt from donor’s tax (Section 12(a));
- LGUs must exempt structures, buildings, and warehouses used for storage of farm inputs and outputs from real property tax, provided the assessed value does not exceed Three million pesos (P3,000,000.00) (Section 12(b)).
- Section 12 requires the Land Bank of the Philippines to provide preferential rates and a special window to accredited farmers and fisherfolk enterprises (Section 12(c)).
- Section 12 authorizes exemptions from income tax for income arising from operations of the enterprise, provided that the farmers and fisherfolk cooperatives and enterprises register as barangay micro-business enterprises under Republic Act No. 9178, known as the “Barangay Micro-Business Enterprises (BMBEs) Act of 2002” (Section 12(d)).
Implementing rules, separability, and repeal
- Section 13 directs the DA, in consultation with the DTI and the DOF, to formulate the rules and regulations within sixty (60) days from the date of effectivity of the Act.
- Section 14 provides a separability clause: invalid or unconstitutional provisions do not affect the remaining provisions, which remain in full force and effect.
- Section 15 provides a repealing clause: all laws, executive and administrative orders, rules and regulations inconsistent with the Act are repealed or modified accordingly.
Legislative approval and adoption trail
- The Act was passed by the House of Representatives as House Bill No. 8857 on January 28, 2019 and adopted by the Senate as an amendment to Senate Bill No. 1281 on February 6, 2019.
- The law was approved by the President on April 17, 2019.