Transfer of CALF Funds and Receivables to QUEDANCOR

Section 25 of the AFMA mandates consolidation of existing credit guarantee schemes and funds, including those under the CALF, into the Agriculture and Fisheries Credit Guarantee Fund (AFCGF) to be managed and implemented by QUEDANCOR.
The order implements consolidation and administration for credit resources through QUEDANCOR as DA’s recognized entity to collect and manage outstanding receivables for and in behalf of DA.

The transfer supports a new DA–QUEDANCOR program called GMA-CARES (Ginintuang Masaganang Ani a Countrywide Assistance for Rural Employment and Services).
Collections from the DA-QUEDANCOR-CALF account augment the credit fund of GMA-CARES.
The order links CALF resources to the Agro-Industry Modernization Credit Financing Program (AMCFP) for consolidation of receivables.

ACPC must effect the transfer of outstanding receivables of ongoing and terminated lending programs under the CALF and other lending programs sourced from the General Appropriations Act (GAA), as listed in Annex A, to QUEDANCOR.
ACPC must also transfer the outstanding receivables under guarantee schemes funded out of the CALF, as listed in Annex B.
The transfer is effective starting upon approval of this order and must be completed not later than ninety days thereafter.
ACPC must turn over to QUEDANCOR the schedule of receivables and all records and documents pertaining to such receivables.

QUEDANCOR is vested with responsibility and authority to collect transferred receivables for and in behalf of DA and/or ACPC, including authority to:
- initiate legal action,
- file cases in court, and
- negotiate and enter into restructuring, compromise, settlement, amnesty, and condonation agreements.
Agreements must conform to guidelines approved by the Secretary of the DA.
QUEDANCOR is entitled to administrative fees and other charges, including attorney’s fees, in accordance with the Secretary-approved guidelines.

QUEDANCOR must open and maintain a separate trust account with a government bank for the collections, with these sub-accounts:
- (a) DA-QUEDANCOR-CALF for collections from lending programs under CALF,
- (b) AMCFP-GAA for collections from lending programs sourced from GAA, and
- (c) AFCGF for collections from receivables of the CALF funded guarantee schemes.
All collections from principal, interest, and other charges, net of administrative fees and other charges including attorney’s fees, must be deposited by QUEDANCOR within a reasonable period into the specified accounts.
QUEDANCOR must issue Official Receipts to payors for collections.
Withdrawals against the trust accounts are signed by the Secretary of the DA, except the AFCGF sub-account.
QUEDANCOR must maintain separate books of accounts for the deposited funds and must render a quarterly report on the status of the deposited funds to DA and furnish a copy to ACPC.

ACPC must continue to assume responsibility for collecting receivables due from the government institutions listed in Annex C.
The order provides that the equity investment of the DA-CALF to QUEDANCOR under the DA and QUEDANCOR Memorandum of Agreement (MOA) dated September 17, 1993 in the amount of Php 130,326,502.78 must be treated and booked by QUEDANCOR, upon effectivity of the order, as part of AFCGF.

Out of cash balances of the CALF held in trust by DA, the order directs transfer to QUEDANCOR upon effectivity of:
- PHP 400,000,000.00 total, comprising:
  - PHP 300,000,000.00 as the credit fund for GMA-CARES, and
  - PHP 100,000,000.00 as capital of the guarantee fund allocated for GFSME–CALF, which becomes part of AFCGF.
Upon transfer of the GFSME guarantee fund, QUEDANCOR must assume administration of the fund and must answer for the liability of that fund pursuant to the agreement between DA-ACPC and GFSME.
DA and ACPC must notify GFSME that, by virtue of the order, QUEDANCOR becomes successor-in-interest of ACPC.
QUEDANCOR must maintain separate bank accounts for the two transferred funds.

From remaining cash balances of the CALF, the order directs that PHP 200,000,000.00 be retained at the Treasury of Bangko Sentral ng Pilipinas (BSP) as a trust fund for ACPC.
The order directs that interest earnings of this retained trust fund be used to fund:
- policy and action research projects,
- institution-building (IB) projects, including joint IB activities with QUEDANCOR, and
- training and other activities of ACPC.
Use of interest earnings is subject to approval of the Annual Work and Financial Plan by the DA Secretary.

To ensure smooth turnover of collection and credit fund administration responsibility, the order directs the transfer of contractual personnel of the CALF Management Office of ACPC to QUEDANCOR.
An initial budget for one year covering salaries and operating costs must be drawn from interest earnings of the CALF upon this transfer.
The proposed initial-year budget, to be released to QUEDANCOR, must be jointly prepared by ACPC and QUEDANCOR for approval by the Secretary of the DA.
For succeeding years, QUEDANCOR must incorporate the staffing and operational requirements in its annual corporate budget.

Utilization of collected amounts, including earnings, pooled in the AMCFP and AFCGF accounts must follow approved guidelines, rules, and regulations promulgated or issued by appropriate government authorities pertaining to these funds.

The transfer of receivables and turnover of records and documents is effective upon approval and must be completed within ninety days.
This administrative order takes effect after fifteen (15) days from filing with the U.P. Law Center and publication in a newspaper of general circulation.