Policy and objectives of the government
- Section 1 declares government policy to promote the development of the tobacco industry and improve the quality of life of those who depend on the industry as a source of livelihood, especially tobacco farmers.
- Section 2 establishes that the NFA shall improve the economic and living conditions and raise the quality of life of tobacco farmers, including those who depend on the industry for livelihood.
- Section 2 requires the NFA to promote the balanced and integrated growth and development of the tobacco industry to help make agriculture a solid basis for industrialization.
Creation, legal status, and core powers
- Section 3 provides that the National Tobacco Administration (NFA) shall administer and regulate the tobacco industry in the Philippines.
- Section 3 authorizes the NFA to incur obligations and enter into contracts essential to the proper administration of its affairs and to accomplish its purposes and objectives, whether with domestic or foreign persons or entities.
- Section 3 authorizes the NFA to own, purchase, lease, mortgage, encumber, or otherwise dispose of real and personal property as permitted by the attainment of its purposes and objectives.
- Section 3 empowers the NFA to promulgate and enforce rules and regulations on the production, standardization, classification, grading, and trading of tobacco and tobacco products needed to attain its purposes and objectives and to pursue government policy on tobacco.
- Section 3 authorizes the NFA to conduct agricultural and industrial research and to establish, operate, and maintain experimental stations.
- Section 3 authorizes the NFA to accept and receive financial and other support from private and other sources for development and promotion of Philippine tobacco industry.
- Section 3 authorizes the NFA to provide incentives and other financial assistance to tobacco growers and their associations directly or in conjunction with accredited financial institutions.
- Section 3 authorizes the NFA to impose administrative sanctions for violations of the rules and regulations issued by the NFA.
Board of Directors composition and governance
- Section 4 provides that the NFA shall be governed by a Board of Directors.
- Section 4 establishes the Board membership as follows:
- The Secretary of Agriculture as ex-officio Chairman.
- The NFA Administrator as Vice-Chairman.
- A Senior Official of the Department of Agriculture duly designated by the Secretary of Agriculture as an ex-officio member.
- Six (6) other members appointed by the President of the Philippines upon recommendation of the Chairman.
- Section 4 requires the six (6) appointed members’ sectoral composition:
- One (1) from the tobacco manufacturing sector.
- One (1) from the tobacco traders/exporters sector.
- Three (3) from the tobacco farmers sector.
- One (1) from the academic community.
- Section 6 makes the Board the policy-making body that formulates policies, promulgates regulations, and prescribes rules necessary, implied, incidental, or conducive to attainment of the NFA’s purposes and objectives, including exercise of its specific powers.
- Section 7 requires the Board to convene in a regular meeting once a month and to hold special meetings as frequently as necessary.
- Section 7 provides that five (5) members constitute a quorum.
- Section 7 provides that the vote of a majority of those present is sufficient to transact business during any meeting.
- Section 7 prohibits the Chairman or the Administrator/Vice-Chairman when acting as Chairman from voting except in case of a tie.
- Section 7 authorizes per diems and other allowable emoluments for the Chairman and members for every meeting actually attended, fixed by the Board subject to existing laws, rules, and regulations.
- Section 7 limits compensation of the Administrator by requiring that the Administrator receive only remuneration and allowances provided by the Board for the Administrator, subject to existing compensation rules and regulations.
Administrator and deputies: appointments and powers
- Section 8 provides that the Administrator is appointed by the President of the Philippines upon recommendation of the Secretary of Agriculture and serves as Chief Executive Officer of the NFA.
- Section 8 provides that the Administrator is assisted by at least two (2) Deputy Administrators, also appointed by the President upon recommendation of the NFA Administrator.
- Section 8 requires the Administrator to submit recommendations and proposed measures necessary to carry out the NFA’s purposes, objectives, and functions for consideration of the Board.
- Section 8 authorizes the Administrator to recommend to the Board, for approval, an organizational structure, staffing pattern, salary structure, and plantilla of personnel in accordance with existing laws, rules, and regulations.
- Section 8 authorizes the Administrator to execute, administer, and implement policies and measures approved by the Board.
- Section 8 requires the Administrator to submit to the Board, in line with the national budget cycle, an annual budget and supplemental budget(s) necessary for Board consideration and approval.
- Section 8 authorizes the Administrator to represent the NFA in all dealings with other persons, entities, agencies, and institutions, whether public or private and domestic or foreign, subject to the limitations and conditions provided in the Executive Order.
- Section 8 authorizes the Administrator, subject to confirmation of the Board, to appoint and to discipline or remove for cause NFA officers and personnel in accordance with the Civil Service Law, rules, and regulations.
- Section 8 authorizes the Administrator to perform purely managerial or routine duties and any other duties assigned by the Board or other competent authority.
- Section 8 assigns Deputy Administrators the duty to assist the Administrator in assuming responsibilities and exercising powers and functions.
- Section 8 authorizes Deputy Administrators to discharge other responsibilities and functions required by the Administrator or the Board.
Term, staffing, and civil service rules
- Section 5 provides that Board members hold office for two (2) years from the date of their respective appointments unless sooner removed for cause.
- Section 5 provides that Board members appointed to a vacancy serve only for the unexpired term of the member they succeed.
- Section 10 subjects the NFA to Civil Service Laws, rules and regulations on all matters regarding personnel administration and management.
- Section 12 requires that incumbent officials and employees from the rank of department manager and below continue to exercise their functions, duties, and responsibilities, with corresponding benefits and privileges unless and until otherwise ordered by the Board.
- Section 12 adopts Civil Service Law, rules, and regulations in the selection and appointment of officials and personnel of the NFA.
- Section 12 gives consolidated tobacco agencies’ personnel preference, all things being equal, in appointment to appropriate positions in the NFA.
- Section 12 requires the Board to approve and prescribe the new position structures and staffing patterns within ninety (90) days from approval of the Executive Order.
- Section 12 requires filling authorized positions created under the new structures through regular appointments by the Board or the President, as applicable.
- Section 12 provides that incumbents whose positions are not included in the new structure and staffing pattern or who are not reappointed under that structure and staffing pattern are deemed separated from the service.
- Section 12 provides that those separated receive retirement benefits under existing laws, rules, and regulations.
- Section 12 provides that, otherwise, separated personnel are paid the equivalent of one-month salary for every year of service or fraction received, but in no case exceeding the equivalent of 12 months salary.
Funding, audit, and transition of funds
- Section 9 provides that the NFA is funded by combining individually approved 1987 appropriations of the merged tobacco agencies.
- Section 9 provides that thereafter the NFA budget is incorporated in the General Appropriations Act.
- Section 9 orders that funds held by the following entities accrue and be turned over to the NFA to form part of its funds, including return on investments, revenue from operations, and other sources:
- Philippine Tobacco Board
- The Philippine Tobacco Administration
- The Philippine Virginia Tobacco Administration
- The Virginia Tobacco Fuelwood Corporation
- The Philippine Tobacco Research and Training Center
- Section 11 places the NFA under the auditing jurisdiction of the Commission on Audit (COA).
- Section 11 authorizes the COA Chairman to assign a Resident Auditor to the NFA and such other personnel as necessary to assist the auditor.
- Section 11 requires that the NFA include in its budget the cost of audit as provided by applicable laws.
Implementation, rulemaking, and sanctions
- Section 3 authorizes the NFA to promulgate and enforce rules and regulations on tobacco production, standardization, classification, grading, and trading to attain purposes and objectives and to pursue government policy.
- Section 3 authorizes the NFA to impose administrative sanctions for violations of NFA rules and regulations.
- Section 6 empowers the Board to formulate policies, promulgate regulations, and prescribe rules necessary to exercise the NFA’s specific powers and to attain its purposes and objectives.
- Section 7 authorizes meeting governance through quorum and voting rules that control Board transaction of business.
Repeal or modification and effect on prior issuances
- Section 13 provides that provisions of the respective charters of the consolidated tobacco agencies, other laws, decrees, executive orders, administrative orders, letter of instructions, and rules and regulations inconsistent with the Executive Order are repealed or modified accordingly.
- Section 14 reiterates immediate effectivity upon approval on July 24, 1987.
- Section 12 provides specific transitory handling of incumbent personnel and Board establishment of new staffing structures within the ninety (90) days period.