Socialized Industrial Forest Management Rules

Policy and program objectives

The policy of the DENR is to ensure equitable access and sharing of rights in natural resource development and utilization by providing opportunities for people to actively participate in forest plantation development under Section 1.
The DENR shall provide security of tenure by issuing a Socialized Industrial Forest Management Agreement (SIFMA) to qualified participants under Section 1.
Qualified tree planters shall receive a privilege to benefit from their crops primarily consisting of trees for wood production, non-timber species, and other cash crops that may be interplanted under Section 1.
The program enhances general welfare through environmental enhancement effects of forest cover restoration and the production of forest goods and services both on-site and off-site under Section 1.
The Socialized Industrial Forest Management Program (SFLMP) aims to produce increased supply of wood and other forest products under Section 2.
The program aims to accelerate reforestation and rehabilitation of open and denuded lands and to protect existing natural forests under Section 2.
The program aims to conserve soil and water, biodiversity, and generally enhance environmental conditions under Section 2.
The program aims to generate additional sources of income and livelihood and help economic upliftment of upland people under Section 2.
The program aims to promote more equitable access to forest resources under Section 2.

Key definitions and terms

A Socialized Industrial Forest Management Agreement (SIFMA) is an agreement entered into between a natural or juridical person and the DENR granting the right to develop, utilize, and manage a small tract of forest land consistent with Sustainable Development under Section 3.1.
A SIFMA Holder is a qualified person who entered into a SIFMA with the DENR under Section 3.2.
A Socialized Industrial Forest Plantation (SIFP) is a tract planted primarily to trees and other products to support manufacturing/processing facilities and/or supply wood and energy requirements under Section 3.3.
Brushland is land predominantly covered with shrub growth or short, stunted trees or shrubs under Section 3.4.
Open and Denuded Land is land depleted of natural forest cover predominantly covered by grasses, herbaceous species, or bare soil under Section 3.5.
DENR refers to the Department of Environment and Natural Resources under Section 3.6.
Secretary refers to the DENR Secretary under Section 3.7.
FMB refers to the Forest Management Bureau under Section 3.8.
RED refers to the DENR Regional Executive Director under Section 3.9.
RTD refers to the Regional Technical Director for Forestry under Section 3.10.
PENRO refers to the Provincial Environment and Natural Resources Office under Section 3.11.
CENRO refers to the Community Environment and Natural Resources Office under Section 3.12.
LGU refers to the Local Government Unit under Section 3.13.
NGO refers to Non-Government Organization under Section 3.14.

Areas covered and site limitations

SIFMAs may cover all grasslands, brushlands, and open and denuded forest lands under DENR jurisdiction under Section 4.
SIFMAs may include areas within government reforestation projects under Section 4.
SIFMAs may cover these areas if they are not otherwise to be classified under NIPAS and not subject of CADC, CALC, and also not within vested rights, licenses, permits, or management agreements under Section 4.
Areas subject to CADC, CALC, vested rights, licenses, permits, or management agreements may be made available for SIFMA only by prior express and written agreement of the holder of such claim or right under Section 4.
Areas covered by pending applications for Certificates of Ancestral Domain/Land Claim are not open to SIFMA applications until DENR, after due notice and hearing under DAO No. 2, series of 1993 or pertinent guidelines, has denied or rejected with prejudice the CADC/CALC application under Section 4.
Areas currently occupied based on a legal claim are not open to SIFMA applications without prior express and written agreement of the occupant or unit with responsibility once the legal claim has been resolved under Section 4.

Qualified parties and disqualifications

Individuals/single family units may participate only if they are Filipino citizens, of legal age, and preferably residents of the municipality where the area is located under Section 7.1.
Actual occupants of the area are given priority under Section 7.1.
Government employees qualify only with the consent of their respective heads of agency under Section 7.1.
Cooperatives and associations may participate only if their members are Filipino citizens and residents of the province where the SIFMA site is located and they are duly registered with the CDA or SEC under Section 7.2.
Cooperatives and associations must show proof of financial and technical capacity to develop the area under Section 7.2.
Individuals, cooperatives, and associations are disqualified if previously issued TFLAs, IFMAs, or other permits/licenses were canceled due to inability to comply with contract provisions including failure to develop open and denuded lands and other plantable area within the prescribed period under Section 8.1.
Individuals, cooperatives, and associations are disqualified if any officers have derogatory records, including violations of anti-dummy laws, tax evasion, illegal logging/smuggling, unauthorized transfer or subcontracting of forestry permits/licenses, or members of cooperatives/associations holding permits/licenses/contracts but unable to comply with the terms and conditions under Section 8.2.
The holder of any existing forest permit, license, lease, or management agreement is disqualified under Section 8.3.

Tenure size, application, and site selection

For individual/single family units, SIFMA may cover 1 to 10 hectares under Section 5.
For association/cooperative, SIFMA may cover over 10 hectares to 500 hectares under Section 5.
Each CENRO identifies potential SIFMA sites using latest forest resource information and baseline data under Section 6.1.
SIFMA sites must be suitable for production forests, accessible, located in contiguous blocks, or adjacent to existing natural forest, plantation forests, or existing CBFM projects, and must be devoid of claim conflicts under Section 6.1.
Each CENRO must inform in writing the concerned LGUs and validate feasibility on the ground with LGU representatives under Section 6.2.
Validated sites, endorsed by concerned LGUs, must be indicated in an appropriately scaled map, with pertinent data and information, and forwarded through channels to the DENR Secretary for approval under Section 6.2.
After approval of a SIFMA site, the CENRO must, within 15 days from receipt of the notice of approval by the Secretary, inform concerned LGUs and conduct an information campaign; program guidelines and the site map must be posted in strategic places in the municipality and barangay where the site is located under Section 6.4.
The approved map and all other documents must be furnished to the Director, FMB for database management and monitoring under Section 6.3.
Interested parties file SIFMA applications with the concerned CENRO in the prescribed format shown in Annex A-A under Section 10.
Application filing fees are PHP 500.00 for 1 to 5 ha, PHP 1,000.00 for over 5 ha to 10 ha, PHP 5,000.00 for over 10 ha to 100 ha, PHP 7,500.00 for over 100 ha to 300 ha, and PHP 10,000.00 for over 300 ha to 500 ha under Section 10.1.
Filing fees may be adjusted upon review under Section 10.1.
Applicants must submit a sketch map of the applied area under Section 10.2.
Individual/family unit applicants must submit a Community Tax Certificate and certifications from the Barangay Captain and Municipality/City Mayor that the applicant is a resident of the area where the site is located under Section 10.3.
If the applicant is a government employee, the application must include authorization from the head of the department or agency where the applicant is employed under Section 10.3.3.
Cooperative/association applicants must submit a certified true copy of their CDA or SEC Certificate of Registration under Section 10.4.1.
Cooperatives/associations must submit a list of duly elected officers and members and their addresses, duly certified by the Board Secretary under Section 10.4.2.
Cooperatives/associations must submit a resolution/minutes of meeting, duly certified by the Board Secretary, indicating the cooperative’s or association’s interest in participating under Section 10.4.3.

Application processing and approval timelines

SIFMA applications are processed by the CENRO on a first-come, first-served basis based on receipt at the CENRO Office under Section 11.1.
Upon receipt, the CENRO must verify area availability and that it is within approved SIFMA areas, verify applicant qualifications, and verify completeness of documents under Section 11.1.
If documents are found in order, the CENRO must determine on the ground physical conditions of the area, presence of actual occupants, soil condition, vegetation, topography, and other ecological factors ensuring plantation success under Section 11.1.
The CENRO must prepare an endorsement and forward all papers to the PENRO with comments and recommendations under Section 11.1.
For SIFMA applications covering areas of 1 to 10 hectares, the PENRO reviews and evaluates documents, and if in order, prepares and approves the agreement in the format shown in Annex A-B under Section 11.2.
For bigger areas, the PENRO forwards the SIFMA application to the RED for consideration and approval under Section 11.2.
The agreement must be approved and issued, or a notice denying the application must be issued, within 5 days from receipt of CENRO recommendation under Section 11.2.
Copies of the PENRO action must be furnished to the FMB, RED, CENRO, and concerned LGU under Section 11.2.
The RED must, within 5 days from receipt of the application and pertinent documents, review and evaluate them, approve if in order, or issue a notice denying the application under Section 11.3.
Copies of the RED action must be furnished to the FMB, PENRO, CENRO, and concerned LGU under Section 11.3.

SIFMA issuance, transfer, and duration

The DENR assigns forest land management responsibility through issuance of a SIFMA under Section 9.
A SIFMA duration is 25 years renewable for another 25 years under Section 9.
SIFMA areas are awarded on a first-served basis under Section 9.
SIFMA is issued in the name of the applicant under Section 9.
If the applicant is a married individual, the SIFMA is issued in the names of both spouses under Section 9.
A SIFMA may be transferred, conveyed, or sold, in whole or in part, to any qualified person, cooperative, or association under Sections 7 and 8 under Section 9.
Transfers require approval of the PENRO or RED, as the case may be, under Section 9.
The transferee must not exceed the applicable limit of 10 hectares for individuals and single family units or 500 hectares for cooperatives and associations under Section 9.
The transferee must assume the rights and obligations under the original SIFMA and must continue implementing the SIFMA for the remaining years under Section 9.
The transfer, conveyance, or sale document must be notarized, and copies must be forwarded to the FMB, RED, CENRO, and concerned LGUs under Section 9.
On cancellation of the SIFMA, copies must be furnished to the FMB, RED, CENRO, and concerned LGUs under Section 9.

Minimum agreement terms and environmental duties

The SIFMA must contain a provision requiring SIFMA holders to furnish necessary management, technology, and financial services for development and management under Section 12.1.
The SIFMA must contain a provision for consultation and arbitration regarding interpretation under Section 12.2.
The SIFMA must prohibit conversion of the area into other land uses not authorized under the SIFMA under Section 12.3.
The SIFMA must include provisions for anti-pollution and environmental protection measures under Section 12.4.
The SIFMA must include provisions for rehabilitation of open and denuded areas and protection of existing natural forest vegetation under Section 12.5.
The SIFMA must include an effective monitoring scheme by the Department, including periodic assessment of SIFMA holder progress, and it requires that the awarded area be fully planted within 3 years from the date of award under Section 12.6.
The SIFMA must integrate gender concerns by providing equitable participation of women in project activities and enjoyment of the fruits under Section 12.7.
The SIFMA must contain provisions for protection of workers’ rights under Section 12.8.
The SIFMA must commit to community development under Section 12.9.
The SIFMA must require planting forest tree species in not less than 90% of the plantable area, allowing rubber and/or non-timber species such as rattan and bamboo under Section 12.10.
The remaining plantable areas must be devoted for permanent agricultural purposes under Section 12.10.
The SIFMA must require keeping areas with slopes 50% or over and strips of land at least 20 meters in width bordering rivers and streams permanently under tree cover under Section 12.11.
The SIFMA must prohibit planting or introducing exotic species untested in Philippine conditions unless clearance is given by DENR under Section 12.12.

Incentives and harvest/charge privileges

All planted trees belong to the SIFMA holder, and the SIFMA holder may harvest, sell, and utilize trees and crops except those retained for environmental protection purposes under Section 13.1.
The DENR allows export of logs, lumber, and other forest products harvested from the SIFMA under the government allocation system under Section 13.2.
Plantation products derived from the SIFMA area are exempt from payment of forest charges under Section 13.3.
The SIFMA holder is entitled to appropriate and reasonable compensation for developments in the area when the SIFMA is canceled without cause or for public interest under Section 13.4.
Actual occupants participating in the program receive priority if future rules, regulations, or laws allow a more permanent tenurial arrangement under Section 13.5.
There are no restrictions on use of the SIFMA and improvements in the SIFMA area as collateral for loans for improvement of the SIFMA area, subject to prior approval of the issuing authority of the SIFMA under Section 13.6.
SIFMA holders may seek technical assistance if they wish to confederate into a larger organization under Section 13.7.

Government share and rental schedule

The government share under the SIFMA consists of products and benefits derived from execution of the SIFMA under Section 14.
Government share includes environmental enhancement through protection and rehabilitation of steep slopes, riverbanks, streambanks, and residual forests; conservation of natural forests through complementation of naturally growing timber with plantation forests; accelerated revegetation and regeneration of open areas; and increased carbon sequestration capability under Section 14.1.
Trees planted for protection purposes that will not be harvested and are maintained by the SIFMA holder as government’s share, such as in areas with slopes 50% or over and along riverbanks and streambanks, form part of government share under Section 14.2.
Government share includes generation of employment under Section 14.3.
Government share includes trails and access road development and improvement under Section 14.4.
Government share includes increased production of fuelwood, food, and other non-wood products under Section 14.5.
Government share includes a ready and steady supply of raw materials for wood-dependent industries under Section 14.6.
Government share includes protection of soil, water, wildlife, and existing natural forest resources under Section 14.7.
Government share includes income taxes paid by the SIFMA holder under Section 14.8.
Government share includes rentals for land free from the first to the fifth year of the SIFMA under Section 14.9.
Rentals are PHP 300.00 per hectare or fraction thereof from the sixth to tenth year under Section 14.9.
Rentals are PHP 500.00 per hectare or fraction thereof for every year thereafter under Section 14.9.
Rentals are subject to future adjustments upon review under Section 14.9.

Cancellation grounds and monitoring systems

The SIFMA may be cancelled or revoked on any of the following grounds under Section 16.
Cancellation is allowed for failure of the SIFMA holder to develop the area within 3 years under Section 16.1.
Cancellation is allowed if the SIFMA holder is found to be a dummy under Section 16.2.
Cancellation is allowed if the holder transfers rights over the area to another person without the knowledge and concurrence of DENR under Section 16.3.
Cancellation is allowed for conversion of the area or any part to land use other than tree farming and planting allowable crops under Section 16.4.
Cancellation is allowed if the holder allows entry of other persons into the area for purposes of building residential houses under Section 16.5.
Cancellation is allowed if the holder cuts or allows cutting of naturally grown trees within or adjacent to the SIFMA area under Section 16.6.
Cancellation is allowed if the holder refuses entry of duly authorized forest officers or duly authorized government officials into the SIFMA premises or into improvements introduced and used for SIFMA execution under Section 16.7.
Cancellation is allowed if the SIFMA was obtained through fraud or misrepresentation or by false or misleading statements under Section 16.8.
Cancellation is allowed if the holder is convicted for violation of the Labor Code of the Philippines and other relevant labor laws under Section 16.9.
Cancellation is allowed for violation by the holder of any terms and conditions of the SIFMA or any pertinent provisions of forestry laws, rules, and regulations under Section 16.10.
Cancellation is allowed for abandonment of the area under Section 16.11.
Cancellation is allowed for failure to pay rentals or other required fees under Section 16.12.
Cancellation is allowed for voluntary surrender of the SIFMA under Section 16.13.
Cancellation is allowed when public interest so requires under Section 16.14.
All SIFMAs issued by the PENROs and REDs must be registered with the FMB within 15 days from issuance under Section 17.1.
The FMB prepares a simplified reporting format accomplished by the CENRO under Section 17.1.
The PENRO analyzes and consolidates the report and submits it to the FMB through the RED with comments and recommendations on policy and program implementation under Section 17.1.
The FMB prepares and submits regular consolidated reports to the Secretary under Section 17.1.
Site monitoring and evaluation uses a team composed of representatives of the concerned LGU, an NGO, and the CENRO as team leader under Section 17.2.
The status indicators include seedling production by species; area and date planted by species; environmental protection and mitigating measures; progress maps by year and species; pictures; and issues/problems with recommendations to improve project implementation under Section 17.2.

Program management roles by DENR office

The FMB acts as the National Coordinating Office under Section 18.1.
The FMB develops and recommends policies, rules, and regulations related to program development and implementation under Section 18.1.1.
The FMB reviews and evaluates potential SIFMA sites and submits a report to the Secretary for approval under Section 18.1.2.
The FMB coordinates implementation and execution of the SIFMA under Section 18.1.3.
The FMB evaluates program implementation and updates DENR Senior Management through periodic reports under Section 18.1.4.
The FMB establishes institutional linkages at the national level with government and non-government agencies as appropriate under Section 18.1.5.
The FMB keeps complete and systematic files and updated information on all SIFMAs and other pertinent documents related to the program under Section 18.1.6.
The RED, assisted by the RTD, is responsible for effective regional implementation, including approving SIFMA applications, issuing cancellation orders, and approving transfers for areas more than 10 hectares up to 500 hectares under Section 18.2.
The Forest Resources Development Division acts as the regional repository of data and information under Section 18.2.
The RED submits periodic reports to the Secretary through the FMB on program implementation including SIFMA monitoring and evaluation under Section 18.2.
The PENRO is responsible for effective provincial implementation, including approving SIFMA applications, issuing cancellation orders, and approving transfers for areas up to 10 hectares under Section 18.3.
The PENRO evaluates periodic reports submitted by the CENRO and forwards them to the RED with findings and recommendations under Section 18.3.
The PENRO maintains a database of all SIFMAs within the province under Section 18.3.
The CENRO implements the program within its jurisdiction in coordination with concerned government and non-government units under Section 18.4.
The CENRO conducts site identification, processes SIFMA applications, and monitors and evaluates program implementation under Section 18.4.
The CENRO submits periodic reports to the PENRO for evaluation under Section 18.4.

Repeal and effectivity provisions

The Order amends or repeals the pertinent Sections of MAO No. 4, series of 1980, DAO No. 60, series of 1993, and other prior orders or sections that are inconsistent with it under Section 19.
The Order takes effect immediately under Section 20.