Republic of the Philippines
CONGRESS OF THE PHILIPPINES
Metro ManilaFourteenth Congress
Third Regular SessionBegun and held in Metro Manila, on Monday, the twenty-seventh day of July, two thousand nine.
REPUBLIC ACT NO. 10000
AN ACT PROVIDING FOR AN AGRICULTURE AND AGRARIAN REFORM CREDIT AND FINANCING SYSTEM THROUGH BANKING INSTITUTIONS
Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:
ARTICLE I
GENERAL PROVISIONSSection 1. Short Title. - This Act shall be known as "The Agri-Agra Reform Credit Act of 2009".
Section 2. Declaration of Policy. - It is hereby declared the policy of the State to promote equal access to opportunities under an environment of sustained growth and expanding productivity as the key to raising the quality of life for all. Towards this end, the State shall promote rural development by enhancing access of the rural agricultural sector to financial services and programs that increase market efficiency and promote modernization in the rural agricultural sector.
Section 3. Definition of Terms. - As used in this Act, the term:
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Republic Acts
AN ACT PROVIDING FOR AN AGRICULTURE AND AGRARIAN REFORM CREDIT AND FINANCING SYSTEM THROUGH BANKING INSTITUTIONS
Republic Act No. 10000
Summary of Republic Act No. 10000 (The Agri-Agra Reform Credit Act of 2009)
General Provisions:
- Declares the policy of promoting equal access to opportunities and rural development by enhancing access of the rural agricultural sector to financial services and programs. (Section 2)
- Defines key terms used in the Act, including accredited rural financial institutions, agrarian reform beneficiaries, agricultural lessee, agro-industry modernization credit and financing program, amortizing owners, compact farmers, farmer, farmworker, farmer's cooperatives, farmer's and fisherfolk's organizations, financial services, fisherfolk, fishworker, owner-cultivators, Philippine Crop Insurance Corporation, Quedan and Rural Credit Guarantee Corporation, settlers, and tenant farmer. (Section 3)
Agricultural Credit, Insurance, and Financing System:
- Establishes an agriculture, fisheries, and agrarian reform credit, insurance, and financing system to improve productivity through government and private banking institutions. (Section 4)
- Specifies that the credit shall be extended to the beneficiaries named in Section 5, including farmers, fisherfolk, agrarian reform beneficiaries, settlers, agricultural lessees, amortizing owners, farmworkers, fishworkers, owner-cultivators, compact farmers, farmer's and fisherfolk's cooperatives, organizations, and associations. (Section 5)
- Requires all banking institutions to set aside at least 25% of their total loanable funds for agriculture and fisheries credit, of which at least 10% shall be made available for agrarian reform beneficiaries. (Section 6)
- Allows banking institutions to comply with the credit quota through various modes, such as investing in bonds or opening special deposit accounts with accredited rural financial institutions, rediscounting eligible paper, lending for infrastructure construction and upgrading, investing in preferred shares or lending wholesale to rural financial institutions, investing in shares of the Quedan and Rural Credit Guarantee Corporation and the Philippine Crop Insurance Corporation, and loans or investments in activities identified under the Agro-Industry Modernization Credit and Financing Program. (Section 7)
- Mandates a joint review by the Department of Agriculture, the Department of Agrarian Reform, and the Bangko Sentral ng Pilipinas after three years to determine the effectiveness of the law and the modes of compliance. (Sections 6 and 8)
Miscellaneous Provisions:
- Requires the Bangko Sentral ng Pilipinas to furnish annual reports on compliance with the mandatory credit allocation to the Department of Agriculture, the Department of Agrarian Reform, and Congress. (Section 9)
- Imposes administrative sanctions and penalties on lending institutions for noncompliance, computed at 0.5% of noncompliance and undercompliance, with 90% of the penalties allocated to the Agricultural Guarantee Fund Pool and the Philippine Crop Insurance Corporation, and 10% to the Bangko Sentral ng Pilipinas for administrative expenses. (Section 10)
- Repeals Presidential Decree 717, a provision of the High-Value Crops Development Act of 1995, and a provision of the law liberalizing the entry and scope of operations of foreign banks in the Philippines. (Section 11)
- Includes a separability clause and a transitory provision. (Sections 12 and 13)
- Specifies the effectivity date of the Act as 15 days after its publication in the Official Gazette or a newspaper of general circulation. (Section 14)
General Provisions:
- Declares the policy of promoting equal access to opportunities and rural development by enhancing access of the rural agricultural sector to financial services and programs. (Section 2)
- Defines key terms used in the Act, including accredited rural financial institutions, agrarian reform beneficiaries, agricultural lessee, agro-industry modernization credit and financing program, amortizing owners, compact farmers, farmer, farmworker, farmer's cooperatives, farmer's and fisherfolk's organizations, financial services, fisherfolk, fishworker, owner-cultivators, Philippine Crop Insurance Corporation, Quedan and Rural Credit Guarantee Corporation, settlers, and tenant farmer. (Section 3)
Agricultural Credit, Insurance, and Financing System:
- Establishes an agriculture, fisheries, and agrarian reform credit, insurance, and financing system to improve productivity through government and private banking institutions. (Section 4)
- Specifies that the credit shall be extended to the beneficiaries named in Section 5, including farmers, fisherfolk, agrarian reform beneficiaries, settlers, agricultural lessees, amortizing owners, farmworkers, fishworkers, owner-cultivators, compact farmers, farmer's and fisherfolk's cooperatives, organizations, and associations. (Section 5)
- Requires all banking institutions to set aside at least 25% of their total loanable funds for agriculture and fisheries credit, of which at least 10% shall be made available for agrarian reform beneficiaries. (Section 6)
- Allows banking institutions to comply with the credit quota through various modes, such as investing in bonds or opening special deposit accounts with accredited rural financial institutions, rediscounting eligible paper, lending for infrastructure construction and upgrading, investing in preferred shares or lending wholesale to rural financial institutions, investing in shares of the Quedan and Rural Credit Guarantee Corporation and the Philippine Crop Insurance Corporation, and loans or investments in activities identified under the Agro-Industry Modernization Credit and Financing Program. (Section 7)
- Mandates a joint review by the Department of Agriculture, the Department of Agrarian Reform, and the Bangko Sentral ng Pilipinas after three years to determine the effectiveness of the law and the modes of compliance. (Sections 6 and 8)
Miscellaneous Provisions:
- Requires the Bangko Sentral ng Pilipinas to furnish annual reports on compliance with the mandatory credit allocation to the Department of Agriculture, the Department of Agrarian Reform, and Congress. (Section 9)
- Imposes administrative sanctions and penalties on lending institutions for noncompliance, computed at 0.5% of noncompliance and undercompliance, with 90% of the penalties allocated to the Agricultural Guarantee Fund Pool and the Philippine Crop Insurance Corporation, and 10% to the Bangko Sentral ng Pilipinas for administrative expenses. (Section 10)
- Repeals Presidential Decree 717, a provision of the High-Value Crops Development Act of 1995, and a provision of the law liberalizing the entry and scope of operations of foreign banks in the Philippines. (Section 11)
- Includes a separability clause and a transitory provision. (Sections 12 and 13)
- Specifies the effectivity date of the Act as 15 days after its publication in the Official Gazette or a newspaper of general circulation. (Section 14)