Shared Service Facilities (Ssf) Project for Micro, Small, and Medium Enterprises (MSMES)

Senate LOftier of the Sumary TWENTIETH CONGRESS OF THE ) REPUBLIC OF THE PHILIPPINES First Regular Session 25 AUG 27 P1:30 SENATE RECEIVED BY. S. No. 1274 Introduced by Senator MARK A. VILLAR AN ACT TO INSTITUTIONALIZE THE SHARED SERVICE FACILITIES (SSF) PROJECT FOR MICRO, SMALL, AND MEDIUM ENTERPRISES (MSMES) BY AMENDING REPUBLIC ACT NO. 6977 OR THE "MAGNA CARTA FOR SMALL ENTERPRISES," AS AMENDED BY REPUBLIC ACT NO. 9501 OR THE "MAGNA CARTA FOR MICRO, SMALL, AND MEDIUM ENTERPRISES" EXPLANATORY NOTE The Philippine economy is dominated by Micro, Small, and Medium Enterprises (MSMEs), with the 2023 report of the Philippine Statistics Authority (PSA) reflecting a 99.63% market share of establishments in the country, employing around 66% of the labor force. To meet the continuous growth of the sector, the Department of Trade and Industry (DTI) spearheaded the Shared Service Facility (SSF) Project under the MSME Development Plan to improve MSME competitiveness by providing machinery, equipment, tools, systems, accessories, and other auxiliary items, skills, and knowledge under a shared system. From 2013 to 2024, the government has allocated an aggregate amount of Php3.7 billion for the implementation of the program, funding 3,651 facilities in all the regions of the country. For more than a decade, the program has aided more than 700,000 MSMEs and has generated approximately 300,000 employment opportunities. The SSF has shown a commendable capacity to accelerate efforts for the development of the country's trade sector, particularly small businesses. Thus, this measure seeks to institutionalize the SSF Project in order to address the gaps in the production value chain, promote innovation among MSMEs, and enhance their capacities to produce and offer diverse products and services. This

measure will improve the quality and market reach of MSME products and shall contribute to the attainment of inclusive and sustainable economic growth. Therefore, urgent approval of this bill is earnestly sought. MARK A. VILLAR ROC

Senate i Dilate of the Decretary TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES First Regular Session 25 AUG 27 P1:30 SENATE RECEIVED BY S. No. 1274 Introduced by Senator MARK A. VILLAR AN ACT TO INSTITUTIONALIZE THE SHARED SERVICE FACILITIES (SSF) PROJECT FOR MICRO, SMALL, AND MEDIUM ENTERPRISES (MSMES) BY AMENDING REPUBLIC ACT NO. 6977 OR THE "MAGNA CARTA FOR SMALL ENTERPRISES," AS AMENDED BY REPUBLIC ACT NO. 9501 OR THE "MAGNA CARTA FOR MICRO, SMALL, AND MEDIUM ENTERPRISES" Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

Section 1. Insert new Sections 16 and 17 under Republic Act No. 6977, as

2 amended, to read as follows, and renumber the succeeding sections accordingly: "SEC. 16. ESTABLISHMENT OF SHARED SERVICE FACILITIES (SSF) FOR MSMES. - IN ORDER TO ADDRESS THE GAPS IN THE PRODUCTION VALUE CHAIN, PROMOTE INNOVATION AMONG MSMES AND ENHANCE THEIR CAPACITIES TO PRODUCE AND OFFER SOPHISTICATED AND DIVERSE PRODUCTS AND SERVICES, THE SHARED SERVICE FACILITIES (SSFS) PROGRAM OF DTI IS HEREBY INSTITUTIONALIZED. THE DTI SHALL ALSO ESTABLISH SSF-FABRICATION LABORATORIES (SSF-FAB LABS), WHICH REFER TO HIGH-END SSFS EQUIPPED WITH AN ARRAY OF FLEXIBLE COMPUTER-CONTROLLED TOOLS THAT COVER SEVERAL DIFFERENT LENGTHS AND SCALE AND VARIOUS MATERIALS, IN AT LEAST ONE (1) STRATEGIC LOCATION IN EVERY PROVINCE TO ASSIST MSMES IN

THE MANUFACTURING OF NEEDED ASSETS AND PRODUCTS, THE PRIORITY SHALL BE PROVINCES WITHOUT EXISTING FAB LABS. THE SSF-FAB LABS SHALL BE ATTACHED TO STATE UNIVERSITIES AND COLLEGES (SUCS); LOCAL UNIVERSITIES OR COLLEGES (LUCS); PRIVATE SCHOOLS, COLLEGES, AND UNIVERSITIES; AND GOVERNMENT ACADEMIC TRAINING INSTITUTIONS OF THE PROVINCE AS DETERMINED BY DTI FOR PROPER MONITORING AND MAINTENANCE." "SEC. 17. MONITORING OF PRODUCTIVITY OUTCOMES. - THE DTI, IN COORDINATION WITH THE CONCERNED COOPERATORS, LGUS, SUCS, LUCS, PRIVATE SCHOOLS, COLLEGES AND UNIVERSITIES, AND GOVERNMENT ACADEMIC TRAINING INSTITUTIONS IN WHICH THE SSFS AND THE SSF-FAB LABS ARE SITUATED, SHALL SUBMIT AN ANNUAL PROGRESS REPORT TO CONGRESS DETAILING THE EFFECTIVENESS AND/OR IMPACT OF THE SSFS, WHICH SHALL INCLUDE THE BUDGET UTILIZATION OF THE PROJECT, ADDITIONAL JOBS AND INCOME GENERATED, INDUSTRY ENGAGEMENT, TECHNOLOGY TRANSFER, AND OVERALL GROWTH OF THE BUSINESSES WHICH AVAILED OF THE FACILITIES."

Sec. 2. Implementing Rules and Regulations. - Within three (3) months from

the effectivity of this Act, the DTI shall promulgate the necessary implementing rules and regulations for the institutionalization and establishment of the SSFs, including the guidelines for the partnership with the cooperators, SUCs, LUCs, private schools, colleges, and universities, and government academic training institutions where the SSFs and SSF-Fab Labs will be established.

Sec. 3. Appropriations, - The amounts necessary to carry out the

implementation of this Act shall be charged against the current budget of DTI.

1 Thereafter, the funds necessary for the continuous implementation of this Act shall be included in the annual General Appropriations Act (GAA).

Sec. 4. Separability Clause. - If any portion or provision of this Act is declared

unconstitutional, the remainder of this Act or any provision not affected thereby shall remain in full force and effect.

Sec. 5. Repealing Clause. - All laws or parts thereof, decrees, orders, rules, and

regulations inconsistent with the provisions of this Act are hereby repealed or modified accordingly.

Sec. 6. Effectivity Clause. - This Act shall take effect fifteen (15) days after its

publication in the Official Gazette or in a newspaper of general circulation. Approved,