National Film Commission of the Philippines

TWENTIETH CONGRESS OF THE ) REPUBLIC OF THE PHILIPPINES 25 JUL -9 P4:13 First Regular Session SENATE .... 5. No. 312 Introduced by Senator MANUEL "LITO" M. LAPID AN ACT TRANSFORMING THE FILM DEVELOPMENT COUNCIL OF THE PHILIPPINES INTO THE NATIONAL FILM COMMISSION OF THE PHILIPPINES, DEFINING ITS POWERS AND FUNCTIONS, APPROPRIATING FUNDS THEREFOR, AND FOR OTHER PURPOSES EXPLANATORY NOTE The Philippine film industry has a rich history and a remarkable legacy of producing world-class cinematic works. For decades, it has served as a potent avenue for artistic expression, cultural preservation, and economic growth. However, in recent years, the industry has faced unprecedented challenges that threaten its sustainability and growth. These challenges call for the establishment of a stronger institution-the National Film Commission (NFC)-to protect the local film industry and foster the development of future filmmakers. With the advent of digital technology and the rise of online streaming platforms, the Philippine film industry faces fierce global competition. Foreign films dominate the international market, limiting the reach of locally-produced films and hindering opportunities for Filipino filmmakers to showcase their talent globally. Rampant piracy and copyright infringement pose significant threats to the revenues of filmmakers and production companies. Unlawful distribution and reproduction of films result in substantial financial losses and discourage further investments in the industry.

Insufficient funding and inadequate government support have hindered the growth and development of the film sector. Local filmmakers often struggle to secure financing for their projects, leading to a reduction in film output and limited opportunities for aspiring talents. The absence of a centralized governing body has created a void in setting industry standards, promoting ethical practices, and ensuring compliance with legal requirements. This has resulted in a lack of cohesive strategies for addressing issues such as fair labor practices and creative content guidelines. The creation of the National Film Commission of the Philippines (NFCP) aims to address the aforementioned challenges and capitalize on the potential of the Philippine film industry. By replacing the Film Development Council of the Philippines, the NFCP will serve as a robust and comprehensive institution dedicated to supporting and protecting the local film sector while nurturing the growth of emerging filmmakers. The NFCP will be responsible for formulating comprehensive policies that promote the growth of the film industry, encourage investments, and ensure a level playing field for local filmmakers. It will work closely with stakeholders, including film associations, industry experts, and government agencies, to create a unified vision for the future of Philippine cinema. The NFCP will establish mechanisms to provide strategic funding and incentives for the production of quality films. By offering financial support and tax incentives to filmmakers, it will encourage the creation of more diverse and culturally relevant cinematic works. The NFCP will collaborate with relevant agencies to implement stringent anti- piracy measures, safeguarding the intellectual property rights of filmmakers and protecting their works from unauthorized distribution. To ensure the sustainability of the film industry, the NFCP will focus on skill development and training programs for aspiring filmmakers. By fostering a nurturing environment for talent, it will contribute to the growth of a new generation of skilled filmmakers.

The NFCP will establish industry standards and guidelines to promote ethical practices and responsible filmmaking. This will include addressing issues related to working conditions, fair compensation, and content ratings. The establishment of the National Film Commission is a critical step towards revitalizing the Philippine film industry and safeguarding its cultural heritage. By proactively addressing the challenges faced by local filmmakers, the NFC will ensure the continued growth and success of Philippine cinema on the global stage. We call on our esteemed colleagues to support this bill, recognizing the integral role of the film industry in shaping our nation's cultural identity and contributing to its economic prosperity. In view of the foregoing, early passage of this bill is earnestly requested. MANUEL "RaTO" M. LAPID Senator

TWENTIETH CONGRESS OF THE ) First Regular Session 25 JUL -9 PA:13 SENATE S. No. 312 Introduced by Senator Manuel "Lito" M. Lapid AN ACT TRANSFORMING THE FILM DEVELOPMENT COUNCIL OF THE PHILIPPINES INTO THE NATIONAL FILM COMMISSION OF THE PHILIPPINES, DEFINING ITS POWERS AND FUNCTIONS, APPROPRIATING FUNDS THEREFOR, AND FOR OTHER PURPOSES Be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled:

Section 1. State Policy - Pursuant to the constitutional guarantee on freedom

of expression, the state shall promote and support the development and growth of the local film industry as an aesthetic and cultural medium for a better understanding and appreciation of Filipino social values and national identity. The state shall also 10 regard the film industry as an economic partner in nation-building. To achieve this end, the State shall formulate and implement policies and programs to upgrade the art and craft of film making and encourage the production of films for commercial purposes, intended for public entertainment, that seek to enhance the quality of life, examine the human and social conditions and contribute to the dignity and nobility of the human spirit.

Section 2. Creation of the National Film Commission of the Philippines - To carry

out the provisions of this Act, there is hereby created a National Film Commission of the Philippines, hereinafter referred to as the "Commission." The Commission shall be an independent agency. The Film Development Council of the Philippines, Inc. (FDCP), created under Republic Act No. 9167, is hereby abolished.

Section 3. Powers and Functions - The Commission shall have the following

powers and functions: 1. To coordinate all programs and policies of government departments and agencies that are related to the development of the local film industry, to include the setting up of film desks in these government instrumentalities; 2. To promote, organize, encourage or support more effective strategies, through which local films can be marketed locally and internationally, thus ensuring the growth and development of the local film industry; such marketing strategies shall also focus on international festivals with marketing components; 3. To develop and promote programs to enhance the skills and expertise of Filipino film artists, technicians and workers through continuous craft and technical trainings; 4. To set up and operate a one-stop shop to assist foreign and local producers making films in the country; 5. To develop and implement a two-pronged program that will encourage the production of quality films through the Cinema Evaluation Board and the Film Endowment Fund Board; 6. To encourage, support, and coordinate the holding of national and regional film festivals exclusively of Filipino films; 7. To establish, organize, operate and maintain international film festivals, exhibitions and similar activities, including, but shall not be limited to, an ASEAN film festival and market, which may later spin off to a wider Asian film festival; 8. To invest funds and other assets in such activities or undertakings that shall directly or indirectly promote the development of the film industry, including the production of films, subject to terms and conditions as it may deem wise and desirable;

9. To ensure the establishment of a film archive to conserve and protect copies of film, in any storage format as may be practicable, as part of the nation's historical, cultural and artistic heritage; 10. To require local film producers to submit a digital video copy of films they will produce for archiving purposes; 11. To set up mechanics to address the welfare and working conditions of local film workers, to be implemented and/or enforced in coordination with stakeholder organizations such as the Mowelfund and the Nagkakaisang Manggagawa ng Pelikulang Pilipino; 12. To assist and oversee the organization of cinema clubs in barangays and schools to promote film appreciation; 13. To prescribe the procedures for the exercise of its power and functions as well as the performance of its duties and responsibilities; 14. To determine the Commission's organizational structure and staffing pattern and appoint officers and employees of the Commission; 15. To determine and decide the appropriate disciplinary action for Commission officials and employees in cases of misconduct, including corruption, dereliction of duty and abuse of authority; 16. To acquire, manage and hold such real and personal property as may be necessary to carry out the purposes and objectives of this Act; and 17. To perform such other functions as may be necessary to carry out the provisions of this Act.

Section 4. Composition of the Commission - The Commission shall be composed

of a Commissioner and sixteen (16) members, seven (7) of whom shall be regular members, while the other nine (9) members shall be in an ex officio capacity: Provided, That the Commissioner shall be a person of proven administrative proficiency, independence, knowledgeable of the technical and artistic aspects of the film production and fully committed to the promotion and development of the

Philippine Cinema as art: Provided further, That the Commissioner shall be elected by the members of the Commission. The nine (9) members who shall be ex-officio members of the Commission are the following: 1. The Secretary of the Department of Trade and Industry or his/her duly designated regular representative; 2. The Secretary of the Department of Education or his/her duly designated regular representative; 3. The Secretary of the Department of Tourism or his/her duly designated regular representative; 4. The Secretary of the Department of Foreign Affairs or his/her duly designated regular representative; 5. The Secretary of the Department of Interior and Local Government or his/her duly designated regular representative; 6. The Secretary of the Department of Finance or his/her duly designated regular representative; 7. The Director General of the Film Academy of the Philippines or his/her duly designated regular representative; 8. The President of the Cultural Center of the Philippines or his/her duly designated regular representative; 9. The head of the Cinema Committee of the National Commission for Culture and the Arts or his/her duly designated regular representative; The seven (7) regular members shall be as follows: 1. A representative of the Directors' Guild of the Philippines, Inc;

2. A representative of the Nagkakaisang Manggagawa ng Pelikulang Pilipino; 3. A representative of the Mowelfund; 4. A representative of the Actors' Guild of the Philippines, Inc.; 5. A representative from the National Cinema Association of the Philippines; 6. A representative from the academe; 7. A representative of the local film producers.

Section 5. Term of Office - The Commissioner and the seven (7) regular

10 members shall hold office for a term of three (3) years unless sooner removed by the 11 Commission; Provided, That they shall be eligible for reappointment after the 12 expiration of their respective terms; Provided further, That if a member fails to complete his/her term, the person appointed to fill the vacancy shall serve only for the unexpired portion of the term of the person whom he/she succeeds, unless re- appointed; Provided finally, That such service of the unexpired portion shall not be 16 counted as a term.

Section 6. Meetings - The Commission shall meet at least once a month or as

18 often as necessary at the call of the Commissioner or majority of the members. A 19 majority of the members of the Commission shall be entitled to honoraria based on 20 existing government accounting and auditing rules and regulations.

Section 7. The Commissioner - The Commissioner shall be the Chief Executive

Officer and shall exercise overall administrative supervision to ensure the effective and efficient implementation of the policies laid down by the Commission. The Commissioner shall have the same rank and salary as an Undersecretary of a Department as provided for in the Salary Standardization Law.

Section 8. Functions of the Commissioner - The Commissioner shall have the

following functions:

1. Execute and administer the policies, plans and programs approved by the Commission; 2. Direct and supervise the operations and internal affairs of the Commission; 3. Establish the internal organization and administrative procedures of the Commission; 4. Recommend to the Commission the appointment, transfer or detail, and disciplinary actions for the subordinate officials and employees of the Commission; and 5. Such other functions which the Commission may assign from time to time.

Section 9. The Executive Director - The Commissioner should be assisted by an

11 Executive Director to be appointed by the Commission upon the recommendation of 12 the Commissioner. The Executive Director shall have a salary comparable to that 13 equivalent rank under the Revised Compensation and Position Classification System 14 and shall be co-terminus with the Commissioner unless sooner removed for a cause.

Section 10. Cinema Evaluation Board - The Commission will absorb the Cinema

Evaluation Board of the FDCP, hereinafter referred to as the "CEB," which shall 17 evaluate and grade films submitted to the Commission, subject to the following: a. Composition, Qualifications and Appointment - The CEB shall be composed of a Chairperson and twenty (20) members, ten (10) of whom shall come from the film industry, and the other ten (10) from the arts, academe, business, and other sectors. The Commission shall appoint the members of the CEB from among thirty (30) submitted by the members of the Commission. Provided, That the persons appointed to the CEB should be knowledgeable of the artistic and technical aspects of film making and fully committed to the promotion and development of cinematographic art along world class standards and global marketability. b. Term of Office - The Chairperson and members shall serve for a term of two (2) years and shall be eligible for re-appointment for a second term:

Provided, That no member shall serve for more than two (2) consecutive terms: Provided further, if any member fails to complete a term, the person appointed to fill the vacancy shall serve only for the unexpired portion of the term of the person whom he/she succeeds, unless re- appointed; Provided finally, That the service of the unexpired portion shall not be counted as a term. In the initial appointments, the CEB Chairperson and the twenty (20) members shall hold office for two (2) years. c. Participation - No member of the CEB shall participate in the grading of a film in which he or she or any member of his or her family or any relative within the fourth degree of consanguinity or affinity shall have the financial or any other interest: Provided further, That such member shall disclose fully at the time of his or her inhibition, the nature of his or her interest including actual or potential conflict of interest and the reasons of his or her inhibitions.

Section 11. Cinema Evaluation System - The CEB shall formulate and establish

17 a set of standards and criteria and procedures for the Cinema Evaluation System, subject to the approval of the council, primarily based on but not limited to the following: direction; screenplay, cinematography; editing; production design; musical scoring, sound, and acting.

Section 12. Grading of Films - The grading of films by the Cinema Evaluation

Board shall be subject to the following provisions: a. Pre-qualification procedures and requirements - The Commission shall prescribe pre-qualification procedures and requirements for application for grading: Provided, That only films whose premiere showing shall be held in the Philippines, and those which have not had any theatrical release, free television broadcast, cable broadcast or video release in any commercial medium anywhere in the world shall be qualified for evaluation by the board: Provided further, That the CEB should evaluate and grade only films that are intended for theatrical and other forms or

exhibition that will charge admission fees and which are at least eighty (80) minutes in length and that the producer shall submit his/her film for grading at least seven (7) days before its scheduled day of play date. b. Evaluation Period - A film shall be reviewed, evaluated, and Graded by the CEB within five (5) working days after submission of the application. The CEB shall transmit its decision to the Commission twenty-four (24) hours from rendering of the decision. The Commission shall inform the producer of the CEB's decision not later than twenty-four (24) hours upon receipt herewith. c. Grading of Films - The CEB shall review and grade a film submitted for grading. The CEB and the Commission shall, at any time neither be allowed to cut, delete, shorten, or modify in any manner films being graded by the CEB, nor shall they be allowed to suggest cuts or deletion or any other form of modification to the filmmakers and prerequisites for earning the CEB grading. Such grading shall be given due weight and consideration by the Movie and Television Review and Classification Board (MTRCB), the Optical Media Board (OMB), The Department of Trade and Industry (DTI) and other governmental agencies for the graded film's viewing, reproduction, exportation and other purposes. d. Reconsideration to the Board En Banc - The action taken by the CEB on the film submitted for evaluation and grading may be reconsidered upon motion to the CEB en banc within twenty-four (24) hours from receipt of notice of said action, and the CEB en banc shall render its decision within forty-eight (48) hours from its receipt of the motion for reconsideration. The CEB en banc must be composed of at least the majority of the CEB. e. Finality of grading - The grading submitted by the CEB en banc the council shall be final.

Section 13. Privileges of Graded Films - Films which have obtained an "A" or

"B" grading from the Commission pursuant to Sections 11 and 12 of this Act shall entitle the producer to a tax rebate incentive equivalent to the amusement tax

imposed and collected on the graded films by cities and municipalities in Metro Manila 2 and other highly urbanized and independent component cities in the Philippines pursuant to Sections 140 and 151 of the Republic Act No. 7160 at the following rates: a. For grade "A" Films - 100 of the amusement tax collected on such films; and b. For grade "B" Films - 75% of the amusement tax collected on such films. The remaining twenty-five percent (25%) shall accrue to the funds of the Council. Provided, however, that fifty (50) percent of the amusement tax rebates will 10 benefit the talents and workers involved in the film that was graded A or B, with the 11 other fifty (50) percent going to the film producer.

Section 14. Amusement Tax Deduction and Remittances - All revenue from the

13 amusement tax on the graded film which may otherwise accrue to the cities and municipalities in Metro Manila and highly urbanized and independent component cities in the Philippines pursuant to Sections 140 of the Republic Act No. 7160 during the period the graded film is exhibited, shall be deducted and withheld by the proprietors, operators or lessees of theaters or cinemas and remitted within thirty (30) days from 18 the termination of the exhibition to the Commission which shall reward the 19 corresponding amusement tax to the producers and the talents and workers of the 20 graded film within fifteen (15) days from receipt hereof. Proprietors, operators or lessees of theaters or cinemas who fail to remit amusement tax proceeds within the prescribed period shall be liable to surcharge equivalent to five (5%) of the amount due for each month of delinquency which shall be paid to the Commission.

Section 15. Enforcement - For purposes of implementing the previous Section,

the Commission may: 1. Impose administrative fines and penalties of not more than one hundred thousand pesos (P100,000.00) for the violation of any of the provisions

of this Act and/or its implementing rules and regulations issued by the Commission. 2. Cause or initiate the criminal or administrative prosecution of violators of this Act and its implementing rules and regulations. 3. Cause the closure of any theater or cinema that fails or unreasonably refuses to remit tax collected on the graded film for a period not exceeding fifteen (15) days after which such period shall automatically lifted without prejudice to the right of the Commission to cause or initiate criminal or administrative prosecution against the erring theater or cinema owners pursuant to paragraph 2 of this section. 4. Call upon representatives of the different government agencies and other various organizations in the movie industry to help ensure compliance with the provisions of this act and its implementing rules and regulations. 5. For this purpose, the Commission may constitute regional sub- commissions in the cities and municipalities throughout the country composed of representatives from the government and from the private sector as may be appropriate to implement the purposes and objectives of this Act and its implementing rules and regulations and they shall serve without compensation and only for such period of time as the Commissioner shall determine. 6. To deputize any Law Enforcement agency and instrumentality of the government for assistance for the implementation and enforcement of its functions and orders.

Section 16. Film Endowment Fund Board - There is hereby created a Film

Endowment Fund Board hereinafter referred to as the FEFB which shall provide subsidies for the production of worthwhile screenplays submitted to the FEFB for consideration, subject to the following: a. Composition, Qualifications and Appointment - The FEFB shall be composed of a Chairperson and seven (7) members, four (4) of whom shall come from the film industry, and the other three (3) from the arts,

academe, business and other sectors. The Commissioner shall appoint the members of the FEFB from among fifteen (15) nominees submitted by the members of the Commission. Provided, That the persons appointed to the FEFB should be knowledgeable of the artistic and technical aspects of filmmaking and fully committed to the promotion and development of cinematographic art along world class standards and global marketability. b. Term of Office - The Chairperson and members shall serve for a term of two (2) years and shall be eligible for re-appointment for a second term: Provided, That no member shall serve for two (2) consecutive terms: Provided further, if any member fails to complete a term, the person appointed to fill the vacancy shall serve only for the unexpired portion of the term of the person whom he/she succeeds, unless re-appointed: Provided finally, That the service of the unexpired portion shall not be counted as a term. The FEFB Chairperson and the seven (7) members shall hold office for two (2) years. c. Participation - No member of the FEFB shall participate in the approving of funding for a film in which he or she or any member of his or her family or any relative within the fourth degree of consanguinity or affinity shall have the financial or any other interest: Provided further, That such member shall disclose fully at the time of his or her inhibition, the nature of his or her interest including actual or potential conflict of interest and the reasons of his or her inhibitions.

Section 17. Film Endowment Fund Evaluation System - The FEFB shall

formulate and establish a set of standards and criteria and procedures for the Film Endowment Fund Evaluation System, subject to the approval of the Commission, based on but not limited to the following: the aesthetic value of the screenplay submitted; the marketability of the film product; and its integral cultural personality.

Section 18. Endowment Funding for Films - The endowment funding for films

by the FEFB shall be subject to the following provisions:

a. Pre-qualification procedures and requirements - The Commission shall prescribe pre-qualification procedures and requirements for application for endowment funding. Provided, That only original screenplays which have not yet been produced and which when filmed are at least eighty (80) minutes in length will be submitted for evaluation. b. Evaluation period - A submitted screenplay shall be evaluated and approved for funding within thirty (30) days after submission. The FEFB shall transmit to the Commission twenty-four (24) hours from the rendering of the decision. The Commission shall inform the filmmaker or scriptwriter of the FEFB's decision not later than one (1) week upon receipt herewith. c. Finality of endowment fund decision - The evaluation submitted by the FEB en banc to the Commission shall be final.

Section 19. Funding - The funding of the National Film Commission of the

Philippines shall be included in annual General Appropriations Act. To augment the operational expenses of the Council, the Council may: 1. Utilize the remaining twenty-five (25%) percent of the amusement tax collected during the period of grade "B" film is exhibited, as provided under Sections 13 and 14 hereof; and 2. Impose reasonable fees and charges for services rendered: Provided, That the amount collected shall be deposited in the National Treasury as a special account in the General Fund and may be used to augment its maintenance and other operational expenses, and capital outlays except its purchase of motor vehicles, subject to existing accounting and budgeting rules and regulation; 3. Secure funding from the Philippine Amusement and Gaming Corporation for the amount necessary to subsidize the production of thirty (30) films annually.

Section 20. Authority to Accept Donations - The Commission may accept

2 donations, contributions, grants, bequests, or gifts, in cash or in kind, from various 3 sources, domestic or foreign, subject to laws governing conflicts of interest in 4 government transactions. Said donations shall be deemed automatically appropriated for purposes specified by the donor, or in the absence thereof, for the programs or 6 projects as may be approved by the Commission, subject to the government 7 accounting and auditing rules and regulations and the provisions of this Act: Provided, 8 That the purposes so determined shall be limited to the purposes of this Act. Any 9 donation, contribution, subsidy, or financial aid which may be made to the Commission 10 shall be exempt from taxes of any kind and constitute allowable deduction from the 11 income of the donors, contributors or givers for income tax purposes.

Section 21. Assistance from other Government Agencies - The Commission may

13 request any department, bureau, office, agency, or instrumentality of government for 14 such assistance as may be needed in the performance of its functions.

Section 22. Implementing rules and Regulations - The National Film

16 Commission of the Philippines shall, within ninety (90) days after the approval of this 17 act, issue the necessary rules and regulations to implement the provisions hereof.

Section 23. Transitory Provision - To provide continuity in the operation of the

19 Commission, the incumbent officials and employees of the FDCP and the CEB shall, in 20 a holdover capacity, continue to perform their respective duties and responsibilities and shall receive their corresponding salaries and benefits until such time that the organization of the Commission shall have been completed. The transition period shall not exceed one (1) year after effectivity of this act. All officials of the FDCP and CEB shall be deemed resigned from services upon the organization of the Commission: Provided, That the officials and employees who shall be laid off shall be given preferential treatment in appointments to new positions to which they may qualify under the new staffing pattern. Provided finally, That those who shall not be given new appointments shall be entitled to all compensation and benefits due them under existing laws.

All books, assets, rights, privileges, records, obligations, and liabilities of FDCP and CEB are hereby transferred.

Section 24. Annual Report - The Commission shall, within ninety (90) days after

the end of every fiscal year, submit to Congress an annual report on its compliance with, or accomplishments under this act, together with its plans and recommendations to improve and develop its capability to enforce the provisions of this Act, and a complete accounting of transactions with respect to any funds received under this act.

Section 25. Repealing Clause - Republic Act No. 9167, otherwise known as the

Film Development Council of the Philippines Act, is hereby amended accordingly. All other laws, decrees, orders, issuances, rules and regulations, which are inconsistent with the provisions of this act are hereby repealed, amended, and modified accordingly.

Section 26. Separability Clause - If, for any reason, any provision of this Act, or

any part thereof, is declared invalid or unconstitutional, all other sections or provisions not affected thereby shall remain in force and effect.

Section 27. Effectivity - This Act shall take effect fifteen (15) days after

publication in the Official Gazette and two (2) newspapers of national circulation. Approved,