Amending R.A. No. 8178 (Agricultural Tariffication Act of 1996)

Scrate POnire of the & cructarp TWENTIETH CONGRESS OF THE ) REPUBLIC OF THE PHILIPPINES First Regular Session SEP -4 P1:11 SENATE S.B. No. 1346 Introduced by SENATOR IMEE R. MARCOS AN ACT AMENDING REPUBLIC ACT NO. 8178 OR THE "AGRICULTURAL TARIFFICATION ACT OF 1996," AS AMENDED, AND FOR OTHER PURPOSES EXPLANATORY NOTE The passage of the Rice Tariffication Act last February 2019 resulted in a decline of rice retail price from PhP 40.75 per kilo in 2018 to PhP 36.93 per kilo in 2020. Rice importation continues to increase year on year, with total rice imports reaching 4.68 million metric tons. Rice tariffication, however, has resulted in fluctuating farmgate prices in the local level. From 2024 to 2025, farmgate prices fell by 33% from Php 24.68 per kilo last July 2024 to Php 16.40 per kilo this July 2025. While the Philippines' compliance with its World Trade Organization (WTO) obligation to impose a bound tariff rate system through the Rice Tariffication Act is important, recent experience asserts government's role in managing, regulating, and even intervening in national rice supplies to guarantee food security and farmers' income. This bill seeks to strengthen the function of the National Food Authority (NFA) to regulate the rice sector by giving back its registration function in the rice industry. The bill also gives the NFA back its inspection and visitation powers. This will allow the NFA to continuously update its national database of grain warehouses, bulk storage facilities, and cold storage facilities. The NFA is also granted back its power to order seizures and impose administrative fines as the enforcement arm of the Department of Agriculture as far as violations to the Anti-Agricultural Economic Sabotage Act is concerned. The bill also gives back the market intervention power of the NFA by mandating it to dispose one-fourth of its buffer stocks every month. This prevents accumulation of aging stocks, addressing the perennial spoilage problems plaguing its operations. It also allows the NFA to regularly replenish its stocks by buying from local farmers,

stabilizing the buying price of rice. This provision works with additional powers granting the NFA the mandate to set a price floor for palay for price stability. To provide further support to farmers, the NFA is also allowed to contract milling services to beneficiaries of the DA Rice Competitiveness Enhancement Fund program. For the abovementioned urgent reasons, the passage of this bill is sought. Free h. Marca IMEER. MARCOS

Senate Office of ile faceclare TWENTIETH CONGRESS OF THE ) REPUBLIC OF THE PHILIPPINES SEP -4 First Regular Session ) P1:18 SENATE S.B. No. 1346 Introduced by SENATOR IMEE R. MARCOS AN ACT AMENDING REPUBLIC ACT NO. 8178 OR THE "AGRICULTURAL TARIFFICATION ACT OF 1996," AS AMENDED, AND FOR OTHER PURPOSES Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SEC. 1. Section 3 of Republic Act No. 8178, as amended, is hereby further

amended to read as follows: "Sec. 3. Definition of Terms. - The following definitions apply to the terms used in this Act: "xxx; (e) 'Buffer Stock' refers to the optimal level of rice inventory for [fifteen (15)] AT LEAST NINE (9) days that shall be maintained to sustain the disaster relief programs of the government during natural or man-made calamities and to address food security emergency situations on rice. "XXX"

SEC. 2. Section 5 of Republic Act No. 8178, as amended, is hereby further

amended to read as follows: "Sec. 5. Strengthening the Regulatory Function of the Department of Agriculture (DA). - The DA, through the Bureau of Plant Industry (BPI), is hereby authorized to: "XXX; "

(b) Conduct regular inspection of grain warehouses and agricultural facilities to ensure compliance with palay and rice quality and supply standards and regulations; [and] "(C) ORDER THE SEIZURE, WHENEVER THERE IS CORNERING, HOARDING, PROFITEERING ACTIVITIES AS DEFINED IN REPUBLIC ACT NO. 12022, OTHERWISE KNOWN AS THE "ANTI- AGRICULTURAL SABOTAGE ACT," AND OTHER LAWS, OF RICE AND OTHER GRAINS, THEIR SUBSTITUTES OR BY-PRODUCTS, INCLUDING THE FACILITIES UNSED IN THE AFOREMENTIONED ACTIVITIES, OR WHENEVER THERE IS SCARCITY OF SUPPLY IN THE RICE MARKET OR UNWARRANTED INCREASE IN THE PRICE THEREOF, ORDER THE SEIZURE OF THE HOARDED COMMODITY AND ITS PUBLIC SALE IN SUCH QUANTITY AS MAY BE NEEDED TO STABILIZE THE SUPPLY IN THE AREA OF SCARCITY AND RESTORE PRICES TO NORMAL LEVELS. "TO ENFORCE THIS PROVISION, THE ADMINISTRATOR OF THE NATIONAL FOOD AUTHORITY (NFA), OR HIS OR HER DULY AUTHORIZED REPRESENTATIVE, IS HEREBY AUTHORIZED TO IMPOSE ADMINISTRATIVE FINES AND PENALTIES; TO CONDUCT INVESTIGATIONS; TO ISSUE SUBPOENA OR SUBPOENA DUCES TECUM TO COMPEL THE ATTENDANCE AND TESTIMONY OF WITNESSES, AND THE PRODUCTION OF BOOKS, PAPERS, DOCUMENTS, EXHIBITS, RECORDS, OR EVIDENCE; TO ADMINISTER OATH; AND TO EFFECT THE SAID SEIZURES. "(D) REGISTER, LICENSE, AND PRESCRIBE AND COLLECT FEES, CHARGES, PENALTIES OR SURCHARGES IN LICENSING AND REGULATING THE OPERATIONS OF THE FOLLOWING: "(I) GRAINS WAREHOUSES OR ANY PERSON ENGAGED IN STORAGE OF RICE AND OTHER GRAINS, THEIR SUBSTITUTES OR BY-PRODUCTS; "(Il) PERSONS, NATURAL OR JURIDICAL, ENGAGED OR INTENDING TO ENGAGE IN THE BUSINESS OR PROVIDING GOODS AND SERVICES IN SUPPORT OF THE DIFFERENT ACTIVITIES INVOLVED IN THE PRODUCTION, PROCESSING, TRANSPORTING, MARKETING, AND TRADING OF RICE, CORN, OTHER GRAINS OR THEIR SUBSTITUTES; "(III) PERSONS, NATURAL OR JURIDICAL, ENGAGED OR INTENDING TO ENGAGE IN THE BUSINESS OF WHOLESALE OR RETAIL TRADE OF RICE, CORN, OTHER GRAINS OR THEIR SUBSTITUTES; AND

"(IV) PERSONS, NATURAL OR JURIDICAL, ENGAGED IN THE PROCESSING OR MANUFACTURE OF GOODS WHERE RICE, CORN, OTHER GRAINS OR THEIR SUBSTITUTES ARE USED AS INGREDIENTS IN THE MANUFACTURE OF STARCH, OIL, ANIMAL FEED, OR OTHER SIMILAR COMMODITIES OR END PRODUCTS. "[e] (E) Collect and analyze data on rice trade activities, in cooperation with the Philippine Statistics Authority (PSA), the Bureau of Customs (BOC), the [National Food Authority (NFA)] NFA, and other government agencies for informed policy and operational decisions. "The DA-BPI shall exercise the aforementioned powers in addition to its existing powers related to sanitary and phytosanitary and food safety standards. Upon the request of the DA-BPI, the local government units (LGUS), the Philippine National Police, the National Bureau of Investigation, or other law enforcement agencies shall provide prompt response and assistance in the implementation of this section. "THE NFA MAY AUGMENT ITS PERSONNEL OR PLANTILLA POSITIONS TO CORRESPOND TO ITS ADDITIONAL POWERS AND FUNCTIONS."

SEC. 3. Section 7 of Republic Act No. 8178, as amended, is hereby further

amended to read as follows: "Sec. 7. Issuance of Sanitary and Phytosanitary Import Clearance for Rice for the Sole Purpose of Ensuring Food Safety. - All importers of rice are required to secure a Sanitary and Phytosanitary Import Clearance (SPSIC) from the Bureau of Plant Industry (BPI) prior to importation in accordance with existing laws, rules and regulations: [Provided, That the clearance shall not provide for impert volume and timing restrietions:] Provided, [further,] That failure on the part of the BPI to release the SPSIC without informing the rice importer of any error, deficiency, omission, or additional documentary requirement shall mean automatic approval of the SPSIC applied for within seven (7) days after submission of the complete requirements. The imported rice should arrive before the [expiration of the SPSIE from the BPF] DATE INDICATED IN THE SPSIC ISSUED BY THE BPI, AFTER WHICH THE SPSIC SHALL BE CONSIDERED EXPIRED. THE BPI SHALL IMPOSE A FEE EQUIVALENT TO THE

MARKET VALUE OF THE UNUTILIZED/UNDER-UTILIZED SPSIC TO ENSURE TIMELY ARRIVAL OF IMPORTED RICE. "XXX"

SEC. 4. A new Section 9-B is hereby inserted after Section 9-A of R. A. No. 8178,

as amended, to read as follows: "SEC. 9-B. PURCHASE OF LOCAL GOVERNMENT UNITS. - TO PROMOTE AND SUPPORT FARMERS AND FISHERFOLK ENTERPRISE DEVELOPMENT, LOCAL GOVERNMENT UNITS ARE HEREBY PROHIBITED FROM IMPORTING AND/OR PURCHASING IMPORTED RICE IN THE DOMESTIC MARKET.

SEC. 5. Section 11 of Republic Act No. 8178, as amended, is hereby further

amended to read as follows: "Sec. 11. Maintenance and Disposal of Rice Buffer Stock. - The NFA shall, in accordance with rules, regulations, and procedures, maintain an optimal rice buffer stock to be sourced exclusively from local farmers REGISTERED IN THE REGISTRY SYSTEM FOR BASIC SERVICES IN AGRICULTURE (RSBSA), FARMER COOPERATIVES, AND FARMERS' ASSOCIATION IN PALAY FORM: PROVIDED, THAT IF NEED ARISES, PROCUREMENT MAY BE UNDERTAKEN IN THE FORM OF MILLED RICE WITHIN THE PRESCRIBED QUALITY STANDARDS: PROVIDED, FURTHER, THAT AS FAR AS PRACTICABLE, THE PROCUREMENT OF MILLED RICE SHALL FOLLOW THIS ORDER OF PREFERENCE: (A) RECIPIENTS OF DA RICE PROCESSING SYSTEM, (B) REGISTERED FARMER COOPERATIVES, AND (C) RICE MILLS OWNED OR OPERATED BY LOCAL GOVERNMENT UNITS (LGUS). "THE NFA MAY CONTRACT MILLING SERVICES TO RECIPIENTS OF THE DA RICE COMPETITIVENESS ENHANCEMENT FUND (RCEF). SUCH TRANSACTION SHALL BE EXEMPT FROM THE APPLICATION OF THE BIDDING PROCESS PRESCRIBED UNDER RELEVANT GOVERNMENT PROCUREMENT LAWS: PROVIDED, THAT THE NFA SHALL UNDERGO A NEGOTIATED PROCUREMENT UNDER THE APPLICABLE GUIDELINES OF THE GOVERNMENT PROCUREMENT POLICY BOARD. "The NFA shall dispose of its rice buffer stock [one (1) month before the aging period starts, following the first in, first out method]

OBSERVING GOOD WAREHOUSE AND STOCK MANAGEMENT PRACTICES, WITH THE EFFORT TO PREVENT THE RICE BUFFER STOCK FROM AGING. "The aging process begins three (3) months from storage for MILLED rice and six (6) months from storage for RICE IN palay FORM. "In [both] ALL cases L, disposal through sale shall be through public auction] AND IN ADDITION TO ITS EXISTING MANDATE, THE NFA SHALL ISSUE THE GUIDELINES FOR THE DISPOSITION OF RICE STOCKS THROUGH THE FOLLOWING MODALITIES: "(A) SALE OF RICE TO ACCREDITED NFA RETAILERS AND THEIR SUBSEQUENT SALE TO THE PUBLIC, WHICH SHALL BE GOVERNMENT BY THE NFA SELLING PRICE BULLETIN; "(B) SALE TO GOVERNMENT AGENCIES AND NON- GOVERNMENT ENTITIES INCLUDING, BUT NOT LIMITED TO, THE FOOD TERMINAL, INC. (FTI), LGUS, THE PUBLIC THROUGH KADIWA OUTLETS, ACCREDITED NFA RICE RETAILERS, AND FARMERS AND FARMER COOPERATIVES AND ASSOCIATIONS THAT SOLD THEIR PALAY TO THE NFA; "(C) SALE THROUGH PUBLIC AUCTION; OR "(D) SUCH OTHER MEANS OF DISPOSITION, AS MAY BE ALLOWED UNDER THE LAW. " IN ACCORDANCE WITH GOOD WAREHOUSE AND STOCK MANAGEMENT PRACTICES, THE NFA SHALL DISPOSE, ON A MONTHLY BASIS, A MAXIMUM OF TWENTY FIVE PERCENT (25%) OF ITS TOTAL EXISTING BUFFER STOCK UNLESS DIRECTED BY THE NFA COUNCIL TO DISPOSE A LARGER PORTION THEREOF, PROVIDED, THAT THE OPTIMAL LEVEL OF RICE INVENTORY IS MAINTAINED"

SEC. 6. A new Section 11-A is hereby inserted after Section 11 of Republic Act

No. 8178, as amended, to read as follows: "SEC. 11-A. SETTING FLOOR PRICE OF PALAY. - TO ENSURE THE ADEQUACY OF SUPPLY AND STABILITY OF PALAY PRICES, THE DA SHALL HAVE THE AUTHORITY TO SET AND ENFORCE NATIONAL, REGIONAL, OR PROVINCIAL FLOOR PRICES OF PALAY. RICE TRADERS SHALL BE PROHIBITED FROM

PURCHASING PALAY FROM FARMERS AT A PRICE LOWER THAN THAT OF THE FLOOR PRICE OF PALAY: PROVIDED, THAT IN SETTING THE FLOOR PRICES OF PALAY, THE DA SHALL TAKE INTO ACCOUNT THE FOLLOWING FACTORS: '(A) COST OF RICE PRODUCTION; '(B) PREVAILING MARKET PRICES; '(C) REASONABLE MARGINS FOR FARMERS; '(D) WELFARE OF BOTH FARMERS AND CONSUMERS; AND '(E) OTHER RELEVANT FACTORS AND CONDITIONS."

SEC. 7. A new Section 11-B is hereby inserted after Section 11-A of Republic

Act No. 8178 to read as follows: "SEC. 11-B. PENALTY. - ANY PERSON WHO VIOLATES THE FLOOR PRICE POLICY STIPULATED IN SECTION 11-A OR ANY RULE OR REGULATION ISSUED THEREUNDER SHALL BE PENALIZED AS FOLLOWS: "(A) IMPRISONMENT OF NOT MORE THAN TWO (2) YEARS, A FINE NOT EXCEEDING TWO MILLION PESOS (P 2,000,000.00) OR BOTH, AT THE DISCRETION OF THE COURT; AND "(B) REVOCATION OR SUSPENSION OF LICENSE, TRADING PERMIT, OR ACCREDITATION. "IF THE OFFENDER IS A CORPORATION OR ASSOCIATION, THE PENALTY SHALL BE IMPOSED UPON ITS RESPONSIBLE OFFICERS SUCH AS THE PRESIDENT, GENERAL MANAGER, OR MANAGING PARTNER. "IF THE OFFENDER IS AN ALIEN, HE OR SHE SHALL BE DEPORTED UPON COMPLETION OF HIS OR HER SENTENCE, WITHOUT THE NEED FOR FURTHER PROCEEDINGS. "ANY GOVERNMENT OFFICIAL OR EMPLOYEE FOUND TO HAVE AIDED, ABETTED, OR CONNIVED TO VIOLATE SECTION 11-A OR ANY RULE OR REGULATION ISSUED THEREUNDER SHALL BE PUNISHED WITH PERPETUAL DISQUALIFICATION FROM HOLDING PUBLIC OFFICE, IN ADDITION TO OTHER APPLICABLE PENALTIES."

SEC. 8. Section 17 of Republic Act No. 8178, as amended, is hereby amended

to read as follows: "Sec. 17. Beneficiaries of the Rice Fund. - The beneficiaries of the Rice Fund shall be those farmers and farmworkers [and their dependents] listed in the Registry System for Basic Sectors in Agriculture (RSBSA), AND THEIR DEPENDENTS, and rice cooperatives and associations

accredited by the DA AND OTHER KEY STAKEHOLDERS OF THE RICE VALUE CHAIN, INCLUDING INPUT SUPPLIERS, SERVICE PROVIDERS, RICE MILLERS, AND RICE-BASED FOOD MANUFACTURERS. Within one hundred eighty (180) days from the effectivity of this Act, the DA. in consultation with farmers' cooperatives and organizations and LGUs, shall REGULARLY validate and update the masterlist of eligible beneficiaries to ensure that those listed are legitimate farmers, farmworkers and rice cooperatives and associations. XXX*

SEC. 9. Implementing Rules and Regulations. - Within sixty (60) days from

effectivity of this Act, the DA, shall, in coordination with the NF, and other government agencies concerned and after consultation with directly affected stakeholders, promulgate the rules and regulations to effectively implement the provisions of this Act.

SEC. 10. Separability Clause. - If for any reason any part or provision of this Act

shall be deemed unconstitutional or invalid, the other sections or provisions hereof shall not be affected and shall remain in force and effect.

SEC. 11. Repealing Clause. - All laws, decrees, executive issuances, rules and

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

SEC. 12. Effectivity, - This Act shall take effect fifteen (15) days after its

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