Creation of the Philippine Coconut Authority
- An independent public corporation named the Philippine Coconut Authority (Authority) is created.
- Reports directly to and supervised by the President of the Philippines.
- Principal office in Greater Manila Area; may establish branches nationwide.
Powers and Functions of the Authority
- Formulate and adopt general development programs for the coconut and palm oil industry.
- Implement a nationwide replanting program using high-yielding hybrid seednuts, prioritizing existing farmers.
- Distribute hybrid coconut seednuts free to farmers.
- Review and integrate policies and projects of other government agencies related to the industry.
- Conduct genetic and agricultural research; establish research stations and equipment transfer from other agencies.
- Expand domestic and foreign markets for coconut products.
- Regulate marketing and export of copra and by-products by setting standards and inspecting exports.
- Establish moisture content measurement and deduction scale for copra sales.
- Impose and collect levies and fees for operating expenses.
- Contract execution for purposes of the Authority without engaging in commercial production.
- Regulate subsidized coconut-based products outside government or farmer-owned entities.
- Issue subpoenas, summon witnesses, and impose contempt penalties during investigations.
- Authorize examination, seizure, and search related to subsidized products.
- Use Central Bank reports for levy assessment.
- Implement reward and compensation systems for violation reporting.
- Exercise other necessary powers for law enforcement.
Governing Board of the Authority
- Composed of seven members appointed by the President:
- Two government representatives (Chairman and Vice-Chairman).
- Three members recommended by the Philippine Coconut Producers Federation.
- One from United Coconut Association of the Philippines.
- One from the hybrid coconut seednut farm operator.
- Powers include directing and managing Authority affairs, budget preparation, levy proceeds disbursement, and organizational setup.
- Board meetings require a quorum of four; four votes needed for decisions.
- Board members receive per diem; no other compensation except actual travel expenses.
Executive Officers and Personnel
- Administrator as CEO, assisted by Deputy Administrators appointed/removed by the Board.
- Officers and employees selected on merit.
- Board may create necessary departments but only one agronomical research department.
Levies Imposed
- Coconut Consumers Stabilization Fund Levy imposed on copra, dessicated coconut, coconut oil, etc., paid by exporters, millers, dessicators, and end-users.
- Current levy rates continue until Authority prescribes changes.
Utilization of Collected Levies
- Subsidies for coconut-based products when national interest requires, based on copra base price and Price Control Council prices.
- Refund of premium duties collected on copra prior to 1974.
- Finance development and operating expenses of Philippine Coconut Producers Federation, including scholarships.
- Fund establishment and operation of coconut-related industries as described.
- Finance Coconut Farmers Refund for social benefits like insurance.
Coconut Industry Development Fund
- A permanent fund managed by the bank acquired for coconut farmers under PD 755.
- Purposes include financing hybrid seednut farm establishment, purchase and distribution of seednuts to farmers, funding replanting programs, and extension services.
- Remaining balance used for investments benefiting coconut farmers.
Coconut Industry Development Fund Levy
- Initial funds include P100 million from Coconut Consumers Stabilization Fund.
- Ongoing levy of at least 20 centavos per kilo on copra equivalent imposed and collected.
- Hybrid seednuts sold or transferred exempt from levies and taxes.
Exemptions and Audit
- Funds are not considered special/fiduciary or government general funds.
- Owned by coconut farmers privately.
- President may authorize audit of entities receiving subsidy or paying levies.
Rules and Regulations for Levy Collection
- Authority empowered to promulgate rules for levy collection efficiency.
- May require periodic reports from liable persons.
- Cannot demand disclosure of trade secrets such as buyers and prices.
Interest and Surcharges
- Authority may impose 14% per annum interest on late levy payments.
- May impose additional 25% surcharge for willful/fraudulent failures.
- May compromise disputed assessments waiving penalties.
Deposit and Use of Collections
- Collections deposited interest-free with bank benefiting coconut farmers.
- Withdrawals restricted until nationwide replanting program is completed.
Investments for Coconut Farmers
- Bank empowered to invest in corporations engaging in coconut/palm oil industries and research.
- Investment funds are from surplus levy collections after funding authorized purposes.
Distribution of Investments
- Investments distributed free to coconut farmers, retaining portions for enterprise continuity.
- Measures ensured for enterprise viability and widespread distribution among farmers.
Penalties
- Willful violation punishable by up to P20,000 fine and/or five years imprisonment.
- Corporate officers responsible for violations by their entities liable.
- Aliens convicted are deported; naturalized citizens may lose naturalization.
- Unlawful possession or use of subsidized products punished similarly, with confiscation of products and proceeds added to Stabilization Fund.
Abolition and Transfer of Agencies
- Coconut Coordinating Council, Philippine Coconut Administration, and Philippine Coconut Research Institute abolished.
- Their powers, functions, funds, assets, and personnel transferred to Philippine Coconut Authority.
- Transition provisions to minimize disruption; previous boards cease immediately upon effectivity.
Repealing Clause
- All inconsistent laws, executive/administrative orders, rules repealed or amended, including specific RA numbers.
Separability Clause
- Unconstitutional provisions severable without affecting the rest of the decree.
Effectivity
- Law takes effect immediately upon enactment.