Law Summary
Licensing Requirement
- Engaging in the grains business without a valid National Food Authority (NFA) license is prohibited.
Sale and Packaging Regulations
- Short weighing or mislabeling of rice and corn is illegal.
- Sellers must display price tags clearly.
Handling of Government Stocks
- Unauthorized possession of government rice or corn stocks subjects the stocks to seizure or confiscation.
- Diversion of government stocks by authorized retailers or cooperatives is prohibited.
Prima Facie Evidence of Diversion Includes:
- Unreasonable depletion of NFA-approved stock allocations at business establishments.
- Selling, lending or disposing of government stocks without written NFA approval.
- Selling beyond the maximum quantity allowed by the NFA.
- Storing or selling government stocks in unapproved locations.
Restrictions on Storage and Sales
- Commercial stocks of rice/corn may not be stored or sold in the same NFA-approved stall used for government stocks.
- Rebagging or resacking government stocks into commercial sacks is prohibited.
- Mixing or adulterating government stocks with commercial rice is illegal.
- Remilling government stocks requires written NFA authorization.
Pricing Controls
- Government stocks must not be sold above prices authorized by the NFA.
Accreditation and Privilege
- Being accredited as an NFA outlet is a privilege, not a right.
Penalties and Sanctions
- Violations subject offenders to prosecution under Section 29 of Presidential Decree No. 4 and other applicable laws.
- Administrative sanctions may include:
- Warning
- Permanent disqualification from distributing government rice/corn
- Cancellation of rice/corn allocation
- Suspension or cancellation of NFA license
- Fines from ₱1,000 to ₱4,000
- The NFA Administrator may issue preventive orders during investigation.
Liability of Corporate Officers
- If violations are committed by corporations, partnerships, or associations, presidents, directors, managers, or managing partners are liable.
Effectivity
- The Letter-Circular is effective immediately upon publication in a newspaper of general circulation and filing with the U.P. Law Center.