Rules and Regulations for Implementation of the Agricultural Minimum Access Volumes (MAVs)

FILENAME: SCANNED BY: Q.A. BY: UPLOADED BY:

L TABLE 01" CONTENTS

SECTION 1-THE MAV MECHANISM A. General Principles B. Definition ofTenns C. MA V Management Committee, Secmariat.

and Advisory Council D. RegiSlralion and Eligibility of MA V Applicants E. MAV Licenses, Withdrawal Fonns and Import Certificates F. Allocation Procedure G. Monitoring AND Evaluation H. Transitory and Other Provisions

SECTION 11- MINIMUM ACCESS VOLUMES FOR AGRICULTURAL PRODUCTS

A. Base Quantities 8. MA V Plus Mechanism SECTION Ill -COMMODITY SPECIFIC GUIDELINES FOR IMPORTING MAV PRODUCTS 31 A. Rice B. Optional Guidelines for Com

SECTION IV • THE COMPETITIVENESS

INHANCEMENT Pl.IND AND DISPOSITION THEREOF SECTION Y • EPl"ICTIVITY AND OTHER PROVISIONS

ABBREVIATIONS A

Adminislrative Order (AO)

Agricultural Compeliliveness Enhancement Fund (ACEF) ASEAN Preferential Trade Agreemcn1 (APTA) B

Bureau of Animal lndus1ry (BAI) Bureau of Customs (BOC)

C Cosl Insurance and Freight (CIF)

D Departmenl of Agricullure Executive Order (EO) G

General Agreement on Tariffs and Trade (GA 1T) General Appropriations Act (GAA)

H Hannonizcd System (HS)

M MAV Advisory Cou11cil (MAC)

MAV lmpon Certificate (MIC) MAV Managemen1 Committee (MMC)

Memorandum Order (MO) Most Favored Na1ion (MFN) minimum access volumes (MA Vs)

N National Food Aulhority (NFA) non-govemmenlal organization (NGO) , Presiden1ial Decree (PD)

Q Qualitative Restrictions (QRs) R R~public Acl (RA)

u unilareral minimum access volumes (U-MAVs)

Republic of the Philippines DEPARTMENT OF AGRICULTURE Elliptical Road, Diliman, Quezon City

Administrative Order No. 9 Series of 1996

01 July 1996

SUBJECT: RULES AND REGULATIONS FOR THE IMPLEMENTATIONOFTHEAGRICULTURAL MINIMUM ACCESS VOLUMES (MA Vs)

IMPLEMENTING RULES AND REGULATIONS OF REPUBLIC ACT 8178 In accordance with Republic Act 8178 issued on March 28. 1996 directing, among others, the Cabinet Committee created by Memorandum Order No. 245 dated December 13, 1994 to submit, in consultation with all concerned agricultural farmer/producer/ processor/importer groups, to Congress within a period of sixty (60) days from the effectivity of the said Act, an equitable and transparent

mechanism for the implementation of the minimum access volumes (MA Vs) having the least government intervention, addressing the requirements of each geographical region. and without entailing any cost to importers/users of these products to the detriment of local consumers and other end-users, as well as creating the Compe1i1iveness Enhancement Fund (CEF), lhe following guidelines are hereby promulgated:

SECTION I - THE l\lAV MECHANISM A. GENERAi. PRINCIPLES I. The implcmen1a1ion of 1hc agricultural minimum :.u:ccss volumes llr MAVs should c,,nform wilh lhe general principles of transparency. equily. 111;1rk.e1-consbucncy. and GATTconsistency. and address the developmen1 requirement nfthc economy in p:eneral am.I the agricuhure scc1or in rarticular.

2. a) Tra11spare11ry. The implementing rules am.I rcgul:nions governing. lhe agricullUral MA Vs should he saahlc ;md the information thereof should he convcnicnlly avail.ihlc to all

concerned parties. b) Equity. The mechanism should he fair in that it addresses the requirements of all concernetl parties in each geographical area and that. without sacrificing 1he objectives of rrmnoting economic efficiency, i1s implcmen1a1ion woulLI result in all concerned parties being a1 leasr as well off as hefore such implementalion. ·

cj Market-c·onsistency. The mechanism should entail the least governmenl intervention and the resulting allocation of the MA Vs should approximare to 1he closes1 extent possible the compe1i1ive imporl shares of imporlers in the absence of lhe 1ariff quola or MA V. d) GA 1T-mn.,istenry. The implemen1a1ion procedures should conform with the relevan1 commitments of the government under GATT 1994, particularly Seel ion 1-8 or lhe counlry 's

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schedule of Uruguay Round Final Act commitments, as well as the Agreement on Import Licensing Procedures. e) Eco110111ic dei·elopmem. The mechanism should address the c1.:onomic development requirements of the country, ease the adjusunt:nt of the industries affected by the lifling of lhe non-tariff import restrictions in agricullure, and contribute to stahilizing agricultural prices at affordable levels.

B. lJEFINITION OF TERMS I. An agri1.:uhurnl product is any product that the government classilit:s under Chapters I to 24 of the Harmonized System of lariff nomenclature as used in the country's Tariff and Customs Code.

2. Minimum Access Volume (MAV) refers 10 1he quantities of a given imported agri1.:uhural product that the government allows 1.:mry into the Philippines at the lower in-quota tariff ra1c. "fh1.:n: are two sets of MA Vs. One set constitutes those whid1 1ht: governmenl 1.:ommitted in the Uruguay Round 1rcaly. The other set are those which the government i1uroJu1.:cJ unilaterally aS part of its trade policy. For purposes of lhis Order. the phrase tariff rate quota is used synonimously as minimum access volume.

An in-4uo1a tariff rate refers 10 the lower rate of customs duty applit:d 10 an agricultural producl as provided for in the l:(lUntry·s tariff and customs code and applicable to an MA V pni<lut.:t. There are two sets of in-quota tariff rates. One set cons1i1u1es those which the government committed in the

SECTION I -THE MAV IIECRANISII · 8. O,lhllt/oa of Tarras

Uruguay Round treaty. The other set ii.-e those which the government introduced unilaterally as part of its trade policy.

4. An out-quota tariff rate refers to the higher rate of customs duty applied to an agricultural product as provided for in the country's tariff and customs code.

5. An MAV product refers to an agricultural product that has anMAV. 6. Representative period refers to the three years immediately preceding a given MAV year.

7. An MA V license is the official permit issued by the Chairperson of the MA V Management Committee (MMC) entitling the MA V licensee to import a given quantity of a specific MA V product at the in-quota tariff rate in a given MAV year.

8. An MAV licensee refers to a firm, cooperative, nongoverrunental organization (NGO), agency, institution, or person who is granted rights to import MA V products.

9. An MA V entrant iefers to a firm, agency, organization, or person who becomes an MA V licensee for the first time in any given MA V year.

10. An MA V year is from January I 10 December 31 of a given year.

11. An MA V Product Category is a group of specific MA V products, whose first four or more digits of their respective

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Hannonized S~ !m codes match and which the MA V Management Comminee grouped as such for the purposes of allocating MAV licenses ..

12. Hannonized System (HS) is a nomenclature of tradable goods, anicles and items as used by the government in its Tariff and Cus1oms Code.

13. The Agricultural Competitiveness Enhancement Fund (ACEF) is a fund created by Republic Act 8178. The fund is earmarked by Congress for irrigation, fann-to-market roads, post-harvest equipment and facilities, credit, research and development, other¡ marketing infrastructure, provision of market information, retraining, extension services, and other forms of assistance and support to the agricultural sector in so far as these measures improve the competitiveness of the agriculture sector.

C. MA V MANAGEMENT COMMITTEE. SECRETARIAT. AND ADVISORY COUNCIL

I . There is hereby created an MA V Management Committee (MMC) which should be composed of the following: - Secretary of Agriculture - Secretary of Trade and Industry - Secretary of Finance - Secretary of Agrarian Refonn - Secretary of Science and Technology - Director-General, NEDA

Chairperson Member Member Member Member Member

. . SECTION I -THI IIAV MICIIANISM ¡ C. IIAYJIUflPIIIBDt Co/rJJill/111

2. The MMC should oversee and regulate the implementation of the MA Vs and dispose ofthecompetitivenej_senhancement fund following the provisions under.RA 8t1t It should set the rules and regulations p;:rtinent to the administration of 1he tariff rate quota. the competitiveness enh,mcement fund. and other related matters.

3. An MAV Secretariat and a private-sector advisory hody should assist the MMC. The MA V Secretariat carries out lhc day-to--day administration of the MA Vs and is accountahlc 10 the MMC. The MAY Executive Dircclor heads the MAV Secretariat.

4. The MA V Secretariat should be composed of employees of the Department of Agriculture assigned on a full-time hasis to fulfill their respective functions in the said body.

5. Among i1s other func1ions, 1he MAV Secretariat would collect from the MA V applicants and licensees lhe ;1ppropri,1te MA V fees that the MMC determines c1nd approves. In approving these, the MMC' shall ensure th:.11 thc fees are kept down to the levels strictly necessary for !he efficient administration or the MAY mechani!.111 ,111t.1 cfo 1101 unduly railie local prices to the detriment of users or consumer~ 111 lhe MAV products.

6. The private sector advisory body is called the MA V Advis1lry Council (MAC). The MMC should organize the MAC which would he tasked wilh advising ii on mallers about the MAY implcmcnlatinn and the disposition of 1hc Competitiveness Enhancement Fund.

SECTION I¡ THE MAV MECHANISM ¡ C. /IIAVIIIID6Pll11DI ColDl1Jl/111

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7. a) The MAC should be comprised of seven members, six of whom should be from the national farmer organizations/ federations and other private entities, including at least one representing the users of MAY products. The seventh member of the MAC should be the Secretary of Agriculture or his duly appoinled representative who must be a snior official of the Department of Agriculture. The MMC should appoint the private sector members who will serve voluntarily for a term of three year. It shall also define the terms of relcrence of the private sector advisory body. h) The Chairperson of the MAC should be the Secretary of Agriculture or his duly appointed representative.

D. REGISTRATION AND ELIGIBILITY OF MA V APPLICANTS I. The MMC should publish notices asking for the submission nf applications for MA V licenses inat least two national news dailies. in the last week of November of a given MAV year.

The notice contains al least the following information: the list and respective quantities of MAV products to be allocated, the opening and closing dates of the application, and the time period when the MA V licenses to be issued out are to be valid, and the address of the government office where the application forms can be obtained and submitted.

2. The application period should be the last month of the existing MAV year. i.e .. from 1 to 31 December of the year.

Applications received after the application perio,1 will not be processed for the incoming MAV year.

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3. The application for MAY licenses should be open to all concerned firms, cooperatives, NGOs, agencies. institutions and persons who may have a legitimate reason to use or sell MA V products. An MA V applicant should be entitiled to one application per MA V product category.

4. In cases where the associations or federations apply for MA V licenses in behalf of their members, 1hese applicants must submit to the MMC a certified list of their members. These organizations must also show that their respective competent authorities had so decided and has accordingly instructed

their respective members not to apply for the MA V licenses that their associations or federations are applying for. If. however, the members of said associations or federations apply for the same set of MA V licenses as their organizations. the MMC should reject the individual applications on the group that these represent a duplication of MA V application.

Furthermore. a member of two or more associations or federations would be deemed to have forfeited the privilege of applyi,;ig for an MA V license for a specific product if one association or federation to which he belongs applies for the same MA V license for and in his behalf. even if the other associations or federations to which he belongs do not so apply fof the same MAV license.

5. The MA V applicants should fill out an application form for the MA V licenses (see attached MA V Form No. I). These application forms should contain the necessary information required for the proper implementation of the MA Vs. In addi1ion to the information requested in MA V Form No. I, supporting documenls may be required by lhe MMC from the applicant to validate the information reflected in the application. Failure to properly fill out the application Slt:l'IONl¡TBBIIAVIIBCWtSll ¡D.b,tllnllODUd8//II/J/UIT

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forms, submit~¡ porting documents, and/or falsification of supporting documents submitted in the application. with intent to mislead the MMC, should be considered grounds for rejecting the current or subsequent applications of the MAV applicant for MAV licenses.

6. The MMC should process the applications for MAV licenses during the first month of the incoming MAY year, i.e., from I 10 3 I January of a given year.

7. As a general rule. only those applicants for MAV licenses who have a demonstrated valid reason to use or sell a MAY product should be eligible to get MAY licenses for the agricultural product. a) Unless it fails to submit its application for whatever reason, an MAY applicant that has been in the business for at leas! the representative period as an importer or a user of an MA V product or its substitute should be automatically eligible IO get MA V licenses in the first year of the MAY implementation. h) The MMC should require that the MAV entrants must operate their respective businesSes that use or supply MAY products for at least one year without the benefit of an MAY access before it considers their respective MAY applications.

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The MMC should require that an existing MAY licensee reapplies for MAY licenses in any subsequent MAV year. It should approve the application, unless it has a valid reason to act otherwise. All existing MAY licensees should be provided. besides the notification through the national news

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SEt"l'ION I - THE HAV MECBANJSM -O. bgfstradoa BBd8Uglb/Uty

dailies, a written letter about the opening of the current MA Vs no later than the last working day of November of any given MAV year.

9. The decision of the MMC on the MAY applications would be final. Where the MMC rejects an applica1ion. ii should inform the concerned applicant of 1he reason for rejecting the application. These reasons may include the fac1 1h,11 1hc applicant is not a user or supplier or the MAY product: harJ falsified the supporting documents in irs applic;nion: had commiued technical smuggling: or had consislcntly faih:rJ ltl use its allocated MA V licenses for reasons unrcla1cJ 10 preferences of buyers or for any other reason tha1. in 1hc judgement oflhe MMC, causes a wasle of the MAY liccnscs.

E. MA V LICENSES, WITHDRAW AL FORMS AND IMPORT CERTIFICATES I. The MMC Chairperson should issue 1he MAY licenses. An MA V license should contain at least the following infom1ation: the Harmonized System (HS) code identifying the MAY product category for which the MAY licensees can apply lhc MAY license: the quantit}' of the MAY product; the name of the MAY licensee, the MAV Account Numhcr; anrJ the validity period of the license. The attached MAY form No. I illustra1es the MAY license granlcd toa hypothclical MA V licensee.

2. The MAY licenses should he applicahle 10 specific MAY products whose respective HS codes match or fall under the HS code that appears in the license.

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3. In any MAV year, lhe 1otal quantities of an MAV produc1 in lhe MA V licenses should be equal 10 lhe au1horized MA Vs as reported in Section II Pan A of this Adminis1rative Order. including any possible incremental quantities that the MMC may authorize for a given MA V year following Part B of Section II below. The MA V licensees can impon these quantities from any supplier of their choice, provided that the imponcd products ob1ained from the said supplier meet the applic.thlc sc1ni1ary and phyto-sani1ary regulalions of the country.

4. The MAV Account Number should consist of a set of numhcrs identifying 1he MAY year that the account is valid (first two digits), the MAY licensee (next three digits), and lhc I IS code (lhc neXI eighl digi1s). If lhe producl calegory is at a levt:I lower than the eight digit level, the mark "X" should fill 1he residual digit positions. Hyphens should separate the year, code of the MA V licensee, and HS codes.

5. The MA V license should be non-transferable. The license should open an MAY account in favor of the MAY licensee.

A licensee may have several MAV accounts.

6. a) Upon allocating the MAY licenses, the MMC should instruct the MAY Secretariat to provide MAY Withdrawal Forms (see attached MA V Form No. 02) to the licensees at cost of priming. The MAV licensees should use these forms Ill ..;ccure from 1he MAY Secretariat the MA V Import Ccrtific..ih:'S or MICs (see attached MAY Form No. 03). hl Th.: MA V Ser.:rt!lariat should submit the following MAY lis1s hl tht! Chid of 1he Central Records Management Di,·i~illll (CRMD) of the Bureau of Customs; 111

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SECTION I · THE MAV MECBAHISII · E. MAI'UceDSas, Wlt/Jdrawa/ Forms

i) The MA V Master List showing all the MA V accounts opened for the MA V year, the names of the MA V licensees, the total quantity of MA V products that the respective MA V licenses can be applied. lhe HS code, the MA V account number, and the validity period of the account; ii) List of MA V Impon Consolidators accredited by the MMC;and iii) MA V for each agricultural product under a spccilic HS Code for a given MA V year.

7. a) Upon receiving a duly accomplished MA V Withdrawal Fonn from the MA V licensee indicating the intent to

withdraw from his/her/its MA V account a given quantity of MAV products robe imported, the amount of which should be duly validated with copies of his Invoice and Bill of Lading, as well as upon verifying that the MA V licensee has

a positive MA V balance in his/her/its MA V account, the MA V Executive Director should issue an MA V Import

Cenificate (MAVIC) in favor of the licensee. The MAVIC should bear the quantities of the MA V product indicated in

the MA V Withdrawal Form that is based On the net volume in the Bill of Lading, or the balance in the MAY account of the licensee, whichever is smaller, the specific description and HS Code of the product, the name of the MAV licensee, the MAV accoun1 number, and the validity period of the certificate. b) Upon issuing the MAVIC, the MAV Secretariat should update the MA V Accoun1 balance of the MA V licensee 10 record the withdrawal that the MA V licensee made.

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8. The MA VICs should be issued in five copies: the white or the original copy; the green or lhe return copy; the pink or the HOC/TED copy; the blue or the MMC s copy; and yellow or the MAV licensee's copy. The white or original copy should be an integral part of lhe import documents covering the MA V importation. The copies should be disposed of according to the regulations that follow:

a) The MA V Secretariat should keep the blue copies of the MA VICs for the record of the MMC and give the yellow copies of the MICs to the MA V licensee for his/her/its record. h) The MAV Secretariat should deliver by messenger the while (original) copy. the green (return) copy, and the pink (BOC/TED) copy to the Chief of the Tax Exempt Division (TED) of the Bureau of Customs (BOC). The messenger's identity and signature must be officially established through an official memorandum from the MMC to the BOC. c) In the event of an MA VIC endorsement, the MA V licensee should endorse the MA V Import Consolidator of his choice at the hack of all copies of the MA VIC. Failure to do so at this point should comPel the MAV import licensee to import the MA V product directly without the benefit of the services of an MAV Import Consolidator. Furthermore. the MAV liccnsl'.'c should make the necessary arrangements with the MA V Import Consolidator to import the MA V product in his/her/its behalf.

9. Only 1hc MA V licensee whose name appears in the MA VI Cs can import the MA V products. unless the MA V volume had

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SECTION I -THE MA VMECHANISM · 8. MA VLlceases, Wltbdrawa/ Forms

been properly endorsed to an accredited MA V Import

Consolidators.

In the event the MA V licensee is an

organiz.ation representing a group of firms and/or persons, the licensee, and not its members. should be the entity legally assigned to bring lhe quantities of the MAV product into the

country.

JO. The MA VICs should be valid for two months from the dale of issue or for a period up to the end of the current MA V year thal the MA V Secretariat issues the import cerlificates, which ever is shorter.

11. Upon use of the MA VIC, i.e .. application of the lower in-

quota tariff rate, the Bureau of Customs official should stamp thewmd "used" on the white. green, and pink copies of the MA VIC . Keeping the used white and pink copies for its records, the BOC should then remit the green copy to the MMC as provided for in Section I. Part G below. This voids the MA VIC which thus cannot he used to avail of in-quota tariff rates in any subsequent importation or the MA V licensee. Failure to void a used MA VIC and/or reusing an MAVIC should constitute a violation of the country's tariff and customs code and RA 8178

F. ALLOCATION PROCEDURES I. The MMC should group the MAY applicants who quali[y for MAV licenses. hereinafter called qualified MA V applicants, based on the MAV product ca1egories that they have applied for. i.e., by either a tariff heading level (4-digit HS level) or at a more specific tariff category level (e.g .. six-digit or eight-digit HS levels).

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The following paragraphs under Section I, Part F outline the specific procedure for allocating the MA V licenses or a given MA V product category.

2. The MMC should further classify the qualified MAV applicanls thal belong to a given MA V product category based on the following classes of use of the MA V product: household. processing, and commercial food service (e.g., reslaurants. hotels, fast-food chains, etc.). To associate these use dasscs with the importers, the following rules should be applied: a) For MA V product categories whose respective quotas are equivalent 10 che level of current import access, all actual importers in the representative period, irrespective ofwhether they are producers, processors, commercial food service providers, or traders, should be considered eligible for allocations.

b) For MAV products which the government had a binding non~tariff import restriction and/or whose tariff quota is more 1han the current import levels, the qualified MA V applicams should be grouped as producers, processors. i.:ommercial food service providers, an路d traders. c) i) Producers are persons, firms or entities that locally produce an MA V product to be sold eventually for public consumption. ii) Processors are persons, firms or entities thal process

the imported MA V product.

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iii)Conunen:ial food servic:,, provide"' arc r,,m,n,. finns. or entities that process the inl!">n<'d MAV product or iu suh5tilute for salt 10 1hc ruM ic .1:r. prepared food.

iv) Tradersareperson!ii. firmsorcmicki,.; 1ho1t inlJklff the MAV produc1s for small and n11.'dium-si1.c rr,-.:cssl,rs or conunercial food service provkkrs. whk:h arc unable to bring into the country thdr imp,,nl'J prodw:t rcquiremen1 at efficient lc\'ds.

3. In &be initial year of the MAV implcmcnt,ui<•n. the MMC' should allocate the MAV licensc, to~uillifi,:.J MAV .ipplic,1111, hued on their resy,ective markcl sharl.!'s. a) For MAV products which imporlcrs htlvc hccn impt,rling

regularly since at leas! the representative p.:rioJ amJ on which impons the government. throu~h i1s rc,!! uh1r slalistical collection ag,c:ncics. has t.latai. the m.irlL'I share should be the impon share. The impo n share is ll'k:' share of the MAV licensee in the total quan1i1y ofdtc impMll:tl MAV produc1 measured in merric Ions of all the 1.1ualilictJ MA V applicants that belong III it ~ivcn MAY rrnJu..:1 cat!?nry durint the represcn1a1ive pcrnlU Tl~ h•lal 4uan1i1y is · computed biised on the respt\:tivc highest importt·<l qmtnlitics ·· o( lhe applicants during the rcpn:scnlativc period. b) Foe MA V producb that have hccn irrcgubrly or :.carccly imported during the represcmativc period. lhl· m.trkc1 stiarc should be 1he local ou1put "han.:. hir lhi,,. purpose, tht'

following rules should apply:

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i) The lot.ii volume of1he produc11hat is sold locally should firs1 be apponioned on the basis of use: ..household. processor. and commercial food service.

This establishes the shares of each of the four ca1egoric:s of use herein identified. ii) Having done the first step above. the respective allocations of each use category should be apponioned funher using the local output share.

This is the share of the qualified MAV applicant in 1hc 101al quantity of 1he locally produced output that all ({Ualificd MA V licensees. falling under 1he use 1.:.t1cgory. sold during 1he representative period in the domestic markel. Where 1he data on sales are c.liflkull 10 ,urn in. the MMC may utilize appropriate proxy v.triahlcs 10 approximate sales. iiiJ The MMC should sc:1 a sic.le an appropriate percentage 11f1h1: MA V t.1uc1n1ity fortradersdelined in paragraph 21.:(iv) ahovc . This provision is for the benefi1 of small and medium-size processors or commercial food service providers. which are unable to bring in11, 1he coumry 1heir imported product requirement al efficient levdS. and/or may have failed to apply for MA V licenses due to 1heir small size. The 1r.u.Jcrs who ~cl this alloca1ion must primarily cater 10 lhc needs of 1he small and medium scale users.

P':1ilurc 10 do so may he a ground for rejecting the applic:uion for renewal of its MA V license -L

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In suhsc(lucm MA V years. 1he following rules shall apply :

SECTION I · THE MAVMECHANISM · /'. AJ/ocallo11Proctdurt

a) ForexistingMAVlicemees, theirrespectiveallocalion ofMAV licenses in the current MAV year should be equal to the respective MA V licenses issued them in the preceding MA V year and their respective share of one-half of the incremental MA V licenses amhorized

for the current MAV year. The share of the MA V licensee in the total licenses issued to all MA V licensees in the preceding MA V year should he used for this purpose. b) The MMC should apponion to MAV entrants the second half of the regular incremental MA V volume.

The shares to be used should be the import shares of the MA V entrants that are to operate wi1hou1 the benefit of lhe MA V for one year as provided for in paragraph 6b, Pan D of this Section. c) In subsequent MA V years, the MA V entrants of 1he immediately preceding MA V year should hecmnc regular or existing MAV licensees. As such. the procedure outlined under paragraph 4(a) ahove

should apply.

5. Where the resulting MAV share of an MAV licensee is less 1han the economic order quantity, the licensee may endorse the MIC 10 an accredited MA V imporl consolidator. The

MMC should regularly inform the Chief of the CRMD of the Bureau of Customs about the list of accredited MAV impon consolida1ors. This provision for imporl consolidation is to give options for small and medium-scale users who arc al 1hc same time MA V Iicensees.

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The MMC .\houltJ accredit MAV import consolidators.

Private or r,uhlidy-ownecJ corr,orations may apply for .tccredi1.:11ion wi1h lhc MMC.

7. a) Where an cxis1ing MAV licensee is dormant and/or fails Ill utili1.c lhl' allocated licenses. the MMC should ask lhc said licensee IOC.'(plain in writing the reason for the nonutilization of the fo.:cnsc ."'. The cxplamuion !.hnuld be suhmiued hefore the MMC announces 1hc :illrn.:,uion of the MA Vs for 1he in(.;oming MA V yc,1r

hi Where thcn.: is reilson 10 hclieve that the said licensee will no lon!!cr he ;1 U!.cr of the MAV licenses, the MMC should c.tm.:cl the MA V licenses alloca1cd 10 the said licensee and shnuh.J ,1ppor1ion lhc same, following the procedure for int.:remcn1al MA Vs. IO other existing licensees in rhc same group thal 1hc ll11rman1 licensee helongs to. Otherwise, the licenses shoulll remain alluca1ed to the dormam MAV

licensee.

H. In any MAV ycar. MAV licensees who decide no11ouse the MA V licenses al11lca1c<l 10 them may voluntarily surrender 1hc unusc<l li1.:c11scs 10 the MMC lhruugh the MAY Secretariat .

The MA V Sei.:relariat should lhen close 'the MAY accounl of 1hc lil:e1,sccsl:<)llCcrncd and put 1he unused licenses lo its pool of unusl."t.l ur l:am;clle<l licenses. When the need arises, the MMC shnul<l allncate 1he pool of licenses 10 existing licensees follo\\"ing 1hc procedure outlined for incremental MA V licenses.

CJ . The: allocation prncc<lun:s outlined in this documem are suhjccl h' .t mamlatory n:\'iew one 10 rwo years from the 1.:fkcli\·ity ,,r lhL' Ad111inistra1ive Order. The in1en1 of the 18

~1 s;o

SECTIOHl·THEM'AVMECRANISM ·F.ADocadoaProcedun

review is 10 improve 1hese procedures and make them more responsive 10 1he needs of 1he parties concerned and the agriculture sector.

G. MONITORING AND EVALUATION

I. The Bureau of Customs~should accomplish the llltlnlhly MAV reporl form (MAV Reror1 Form No. OJ) ;,nd suhmi1 it to 1he MMC through the MAV Secre1aria1 along wi1h the perfora,ed MA VJCs and hills of lading for MA V rrnduc1s.

This reporl shciuld reconcile the quantities t1f MA V pn,Jucts that imponers brought in and lhe used MA V licenses. The BOC should submit to the MMC 1his report no J.uer 1h,m a week from the stan of a given month.

2. The Bureau ofCus1oms should a1.:ct11nplish the ct\11St1lid111cd semestral MAV report form (MAV Reporl Form No. 02).

The purpose of this report is 10 monilOr the ou1 -quu1:i imponations of MA V products. The BOC should suhmil 1his report to the MMC no later than rwo weeks fro1111he st.in of January or July of a given MAV year.

3. The MMC should periodically re\'iew lhecxisting prul:cdurcs of MAV implementa1ion and idenlify its pn,hlcms. with the view of immediately solvinJ:! 1hcsc prohlcms in a m,mncr consistent with 1he general principles of rhc implcmc111:1ti1in of 1he MAVs.

SECflON 1·THEMA.V MECHANISM ·O. MoaltortogaodEY•Ju•doa

1f

I~

·VA AJ1111ms1ru11w.• 1Jr,f,•r No \I

Of J11(1· I 996

.VrirJ of I 996

H. TRANSITORY AND OTHER PROVISIONS I . CatC'hing up prov;sion. In the interest of meeting the country's international commitment without any further delay, the MMC should allocale lhe MA V licenses from July I 10 December 31, 1995 and from January I to December 31 , 1996 no taler than July 31, 1996. II should allocate only lhe licenses corresponding to lhe quantities of MAV products which the coun1ry has yet to import at no more than the in· quota tariff rates 10 meet its international treaty oblligations or to implement a trade policy in the case ofunilateral MA Vs .

These licenses should be valid for impons which arrive in lhe country no la1er 1han December 31 , 1996.

2. The allocation should follow a fasHrack procedure as follows: The application period should be from July I lo July 15. 1996. The MMC should issue lhe licenses by August I , 1996.

3. A unil;11cr.1l MA V is one in which the Philippines does not have: any MA V i:ommitment in any international trade treaty . or llllc lh:u is more than its international MA V commitment.

As a rult:. the gowrnmt!m should limi1 the implementation of the MA vs· to those: lhat the country had commiued in international trade treaties. The excep1ion to this rule shall he! governed hy 1hese conditions: a) FClr imponed products chat the government had liberalized tk!fore 1he efft:L:livicy of RA 8178 and EO 313 modifies their rc:speL:tive 1ariff rates to higher out·quota tariff rates. the government should provide a unilateral MA V equal to the la1est i.:urrc:n1 impon access volume and with a reasonable growth per annum of such MA Vs . :!:O

~

SBtTIONl·THEIIAVMECJWOSll ·6.0llJ~rProFU/oa

b) For restricted products whose QRs RA 8178 tariffied and that the Philippines does not have any MA V commitment

under any international trade treaty, the government may provide a unilateral MA V if both producers and users of the concerned product mutually agree to a specified

volume and in-quota tariff rate.

c) For restricted products whose QRs RA 8178 tariffied and that the Philippines has a binding MA V commitmen1 under an nternational trade treaty bul the quantities are

less than the current imporl access, the gowrnment should unilaterally expands the MAV up to 1he current

import access.

4. The margins of preferences under the ASEAN Prtferential Trade Agreement (APTA) are applicable to the in-quma or out-quo1a Mosr Favored Nation (MFN) tariff races.

5. Transitory pro,•ision.

Imported products covered hy the catching up provision in this Administrative Onlt:r (AO) and/ or whose import enlries are filed between 1he etlec1ivi1y of this Order and the time in which the MAV licenses hat.I been issued 10 implement !he catching up provision shoultl he

eligible for provisional MAV lmporl Certifica«s(MAVIC') under the followin'g conditions listed under 1he following

paragraphs 5a 1h(otigh 5 f. a) Upon lhe effectivity of this Order. an importer 111;,y apply

for a provisional MA VIC in a lencr .u.Jdrcssc<l 10 the Chairman of the MMC'. With this applkalion. the importer must suhmil a copy of lhc hill nf la<lin!! am.Jfor of 1he pro-forma invoke for the imported -'!!rkuhurnl producH,covered by the catching up pnwisilm . .-ntl a t..luly SICTIOJI J · THI MAY MECHANISM · H Olb1r Prorls/oas

ff

21

nolarizcd biu .... cenifation that an MAV trust account had hl.'en opcnod by the imponcr in 1hc dcsigna1cd bank.

Upun verifying the authentici1y of these documcn1s, lhc MA V Executive Director should issue a provisional

MAVIC in favor oflhe importer and equal 101he volume illllicalcd in 1hc bill of lading. hi The amounl of lhc trust fund should be al least equal 101he c.lilTcrcnce between the revenues accruing to the Bureau of Customs on the basis of the out-quota tariff rate and those· based on 1hc in-quo1a tariff race of 1hc affec1ed imponcd a~ricultural produce. The beneficiary of lhc 1rus1 fund should he eilher the Bureau of Customs or the importer.

The trustee should be the Secretary of Agriculture in his l:apm.:ity as Chairman of lhe MMC. As trustee, the Sci;rctary of Agriculture should decide whether the MAV trusi func.l account goes to the Bureau of Customs or the importr.:r. However. if the amount of the trust fund is found h> he insufficiem by the Bureau of Customs during the prn~essing of the import entry, the deficiency should be deposited with the Burea of Customs which shall issue an official n:ceipl therefor and keep lhe same in trust until the Scuetary of Agriculture shall have decide..! Lo whom the MAV trust fund accciun1 shuuld go. c) llpon receiving the regular MAVIC to replace the provisional MAVIC. the BOC Commissioner or his authorized representative should n::linquish his claim on the MA V trust fund in a letter addressed to rhe Se<.:retary or Agricullure. d) Upon receiving '1nd verifying 1he au1henticny of thi~ letter from thc BOC Commis~ion~r. 1ht: Secretary of Agnculrure ]$

SECTION I · THE 11A VMECHANISM · 8. Other PromloDS

should write an official letter to the designated Bank identifying the imponer as the beneficiary of the MA V trust fund account. Copies of the letter should be provided to the Bureau of Customs and the importer. e) In the event the importer fails to get a MA V license under the catching up provision, the Secretary of Agriculture should write an official lcue_r 10 lhe designated Bank identifying the Bureau of Cusloms as the beneficiary of the MA V trust fund account. Copies of the letter should be provided to the Bureau of Customs and the importer. f) For the purposes indicated in paragraphs 5d and Se above, the Secretary of Agriculture should write the designated Bank of his decision no longer than two weeks after the MA V licenses to implement the catching up provision have been released.

SEtilON I ¡THE MAV MECHANISM -8. 01/MrProl'/sloas

â&#x20AC;˘

2J

MAY Form No a&-(I01

MAV LICENSE APPLICATION FORM l 1c1n1n lnued lar 19 HSCodt

3. Bus,nns Ad drtu (include ZIP code)

·."r ..

•">

H S Pradud Code!./ L,n,at Busintss N•maolSus,r,ess

; · ::-

• ,.,.,_-

4 Teltphont1ndFA.XNumbers

-

Actual Product Re-au1r~tnl1 in ml) 1

- . . ...

• C"

.... .;..-.

f.....:

ForMAVOffldafU.OnlJ .

-~ ~-

·:~

..

.. ..:.::-.

Tenlalive MAV Form 02 Account :'!o. 96-001-0203XXXX

MWF No.

f0 MAY WITHDRAWAL FORM GQ Issue to the order of _ _ _ _ _ _ _ _ _ _ _ the MAV Import Certificate amounting t o - - - - - - - metric tons.

MAV Management Committee D,~artm,ntolAg"cunurt ~ra F:oor Elhp1ica1C::c!t C,l,m1n. OutzonC,ty

--------- i MAV Form No 96-002

)

Tenlallve MAV Form No. 03

MIC Conlrol No. - - -

MAV Fo,rm Na IIIMXl3

MAV Management Committee

rJr~~"J.i~~~= Oillmlln, OuezonClty 1/e,41/ '71H{ufft ~ (11ou-transfe"able) _ _ _ _ _ _ 19

This certifies tliat is a11tl1orized to import wit/r HS Code at a volHme of (mt) at tire ill-quota tariff rate. T/ris certificatio11 is valid 011 a"ival basis iu tire MA Vyear _ _ _.

MAV Eâ&#x20AC;˘eculive Direclor

(ltn:k Portion) Emlorseme11l of Certificate

ENDORSEMENT

This certificate is endorsed to:

(name of011 accredited MAV Jmporl Conso/1da1or)

licensee

SECTION II

MINIMUM ACCESS VOLUMES FOR AGRICU!,-TURAL PRODUCTS A. BASE QUANTITIES

1. The minimum access volumes listed unJc:r lhc: Annex. I of 1his documen1 are those quantitit:s of agril.:uhural products as identified by lheir respective HS codc:s 1ha1 the govi:rnnu:nt is aurhorizing to he imported suhject to 1heir c,,rrcsrn,nc.Jing lower in-quota tariffra1es. These r.itcs arc l(x.mJ inthi: ·r,1riff and Cus1oms Code as amended of the Philil1()in,:i..

2. Where 1he Tariff and Customs Code pmvid~ an in-quot:i

tariff race for a given tariff line hut Annex I oflhis documcm does not provide any MA V quantities flu lhc parlicular tariff line. 1he Bureau of Cusloms should colh:ct the dulies based on out-quota tariff rates.

B. MAV PLUS MECHANISM I. To address 1he problems of possible cumm,k!i1y shortages or abnormal price increases of agrk ultllral producls whose quan1i1a1ive restrictions RA 8178 had lifled, hereafter called commodities, the MMC may prnposc 1hat lhe President increase 1hc MAVs on agricultural prodU1.:ls following lhe provision in RA 8178.

2. Commodi1y shortages an:: defined and maJc cvidenl hy lhe local wholcsah: prices of commodities tht11 exceed the CIF

prices of thdr resrec1ive 1.:ompeting imports in local currency fllus the average of the applicable out-c.iuma and in-quma BICTIONJ -mMAY1QUANTJTJIS -A.8u.Oaul/lH6

•

27

'ANNEX 1. MINIMUM ACCESS VOLUMES HS HHdlna

r--

Deacflp11on

1 Jonuory

19!L.__!!!~--1!!?~ ..J.!!8 0102

LIH lovln• Anlm•I•

Hud

8 , 100

12.851

13,551 •

0103

LIH Swine

HHd

1,285

2,51 0

0104

LIYII ShHp and Goel

24,HS

St.234

0106

Live Poullry. that I• lo HY, fowls at the ,peel•• O•llu,t""''tlcu.. duck,, geHe. ,key., and 111.11n,atowl,.

0201

MHI of llovlne enlmel, fteal'lorchllled

or Bovine Anlrl'IIII. FroHn

Hud

MT

2,000

0202

MHI MHI

of •wine fr••h , chllledortroien

MT

0204

Meet of •hup or ao•t• fresh, chlllod or troien

MT

335

0207

MHt •nd edlble ottel of poultry. fresh, chilled. or hozen

MT

7,345

0101

Potatoes, frHh or chlll1d

MT

•••

0901

Colle,. whether or not roHt41d or de c:ellelnotod; cotre• hueks end . .In,; colee s ub,tltutH c:ont•lnlng coffee In a ny proportion.

MT

1005

Melz• (Corn)

MT

1008

Ale:,

MT

1701

Suaer

MT

2101

Eatrec:1&. Hsenc:•• end concentfalM et c:olle,: tee or mite 1ndprape1atlon1 wl • ll••l• of th••• prodvct, Of whh of cott, ,. •••. e r m11te: ,o..t•d chicory ind o ther 10,,1,d coffee 1ubllllutc1. end 4111rects , 11Hnc.,. end c:.onc,ntr•t•• thereof,

MT

4 ,017

2.000

2001

2002

20113

211114_.

_~':)O~

1' ,4 80

tS,3"4

18,2H

11,112

18.078

11.910

1!1,884

2,570

2.510

2.51 0

:Z,570

2,570

2 .SlO

2,510

2,570

1.28S.O

54,892

58.515

82. 173

85.831

119,890

73.871

78,494

81.827

40.813.S

2,588,854 5,834. 128 8,342,358

0203

• tr•••• .?R

.....

19S9

4,281

9 .942.0

15,785,180 7.188.004 7,1510,828 8,033,852 8,458,478 8 ,879 ,300 8,302,1215 4,851.083.0

.

4,435

4 , 909

4,783

4,957

5 , 131

6 ,305

5,481

2 .740.5

21, 131

S7.0H.

71,317

H.511

18,411

108,251

11 , .0,s

130,184

144.093

72.048.S

33.725

38,135

38.545

40,955

43,385

45.71'5

48.tlS

'53,0 05

241.S02.5

•••

745

795

845

885

145

...

50,SH

1,045

1,095

5 4 7.5

15. 180

18,180

17,140

18, 120

11,100

20,080

21 ,080

22,040

23,010

11,505.D

•••

1,035

1,105

1,175

1.24'5

1,315

1,385

1,455

1,520

740.0

927

tu

1.060

1. 128

1,112

1.2158

1. 324

1 ,311

1,457

74 5

85,080

134.981

144,823

154,285

113,907

173,548

183,191

'82. 833

202 ,475

212,111

108,061.0

29,885

81 ,513

85,079

H,645

94,944

131,408

156,304

179,200

203,0H

226,992

113.498.0

19,215

39,&54

42,701

45,548

48,395

51,242

54,081

51,9311

59,7 83

62,821

31 .314.0

20

20

20

20

20

20

20

20

20

,o

MT 18.280

• ,_

29

DA .<fd,i11m:urt1mv ( )rtkr N11 !,I

S~r,tts1,JIYIJ6

tariff rates. The l\o1MC should conduct forecasts of commodity prices to prevent abrupt disruptions of commodily supplies.

3. When increasing the MA Vs of commodities is necessary. 1he Presiden, should seek lhe approval of Congress 1hrough 1he Sena1e President and Speaker of the House of Representatives.

In the event that Congress fails to act on the proposal wilhin fifleen days af1er lhe receipl oflhe proposal by lhe Sena1e Presideni and the Speaker of the House of Representatives, the proposal is deemed approved.

4. Upon approval of lhe proposal to increase the MA Vs ot

commodities by the appropriate authorilies, the MMC should issue additional impon licenses to exis1ing MAV licensees proponionately and increase 1heir respective MA V accounls .

These additional licenses should be valid upon 1he arrival of 1he MA V products in lhe MA V year 1ha1 1he MMC issues these permits. The use of 1hese additional licenses should follow the procedure outlined in Section I of1he Administra1ive Order.

JO+

SBcrIONl¡TBBIIAVsQOAN'l'l'l'IIS ¡ A.J/ar/1h18J/ICJJ8/JbJD

SECTION Ill COMMODITY SPECIFIC GUIDELINES FOR IMPORTING MAV PRODUCTS A. RICE

I. In accordance with Presidential Decree No. 4 providing the Nalional Food Authority the sole responsibility to import rice and with the country's Section 1-B commitmen1 under

the Uruguay Round Final Act which assigns the NF A the sole responsibility to impon rice, the MAV for rice shall he imponed solely hy the NFA.

B. OPTIONAL GUIDELINES FOR CORN I. In recognition of the existing practice of allocating the corn quota before the implementation of RA 8178 though the NFA, the MMC should accredit the NFA as an MAV Import Consolidalor for corn. As such, the NFA may import the corn MAVs with certificates that the MAV licensees have duly endorsed to the NFA following the provisions under paragraphs 3c and 3d, Pan F, Section I. 2. To conrinuc the prac1ice of allocating the quota, which is widely accepted by existing users and producers of corn, ii

is part of government policy 10 implement the mechanism in a way as to make the existing importers as well off as before the implementation of RA 8178. Accordingly. the MMC may consider retaining I.he present practice that has transpired

in allocating the corn quota up to the extent that 1his prac1ice is consistent with the overall implementation mechanism outlined in Section I.

SICl'ION DI · COIIIIOllnt BllCIPIC GUWIUNIS · A. RI"

•

JI

fl/ Ju(,· 1996

Series of /996

3. All existing corr. ~mporters would still have to follow all the general rules and regulations as provided for in Section I of this Order. As practiced. the MMC should allocate the com MA V licenses to the legitimate com users who are duly registered with the Bureau ofAnimal Industry (BAI). Quezon City. Accreditation of com users should be an important criterion for approving the application for MAVs. 4. If corn importers. particularly those small and mediumscalc. may find it economical to purchase the services of the NFA to import their respective MAV quotas for corn in their hchalf. they should be guided by the rules and regulations contained under this Section, Part B. as well as by any additional conditions which can be directly obtained from the NFA.

5. Funhctmore. it the situation~ described in paragraph 4 prevails. the following rules and regulations should be appli~-d. The listing of these rules and regulations should not he intc:rprc~'d as limiting the com importers to purchase import consolidation services only from the NFA. a) The MAV licensee shall endorse the MAVIC in favor of the NFA. In addition, a notarized authorization to transact business with the NFA should be executed only by cmployees/ofticers or Board of Directors ofcompanies. associations or cooperatives h> Corn users must indicate in their letter of Intent their preferred disport. either at ATI-Mariveles. Bataan or

Manila/other disports.

9

~·,•

32

SECTION m. CODODm SPECIFIC GUIDELINES . B. COl'/I

c) Priority as to vessel assignment should be based on the order of submission of complete requirements by the applicants. ¡d) Corresponding service fees should be charged depending on the discharge port. Com MAV licensees should have from thirty (30) weather-working days up to a maximum of fifty (50) calendar days to withdraw the com beyond which a storage fee per day shall be charged against the buyer if withdrawal exceeds the given period. e) The fee for Manila/other ports shall be ex-vessel. The price for ATI-Mariveles shall be ex-ATI. The handling of stocks from the mother vessel shall be for DA/NFA's expense. Trucking, bagging and barging charges shall be shouldered by the buyers. t) The NFA can also offer integrated services at the Manila

port at an indicative rate as follows: Mode of Withdrawal

Rate per MT Rate per kilo

Ex-vessel Ex-bagging terminal Ex-warehouse

P 150.00 P795.00 P995.00

P0.15 P0.795 P0.995

Above rates are subject to change. The NFA will issue appropriate notices to effect any changes to these rates. g) Only one integrated cargo handler should be allowed per vessel. Should the buyers comprising one vessel opt to hire NFA services in the unloading of stocks, the NFA

y

.......,.,

SECTION DI - COMMODITY SPECIFIC GfilDELINES -B. Com

33

DA Admimstrahl'r Orckr No 9

01 July /996

Serirsof/996

sou Id then undertake the unloading of the whole vessel.

The selection of the cargo handler should be based on majority's decision based on volume. h) Should the corn users hire a common cargo handler, they could pool their resources together, however, they should undertake the following: i)

Designate an authorized representative to officially act or transact business in their behalf.

ii) Furnish the NFA a copy of the Contract entered into between the corn users and the Integrated Services Contractor.

iii) Submit to the NF A a Special Power of Attorney authorizing the Integrated Services Contractor to act in their behalf. iv) Secure approval of the NFA Metro Manila Office in case there are changes in the unloading point/silo. i)

Stocks discharged at ATI, Mariveles should pass through dust separatOrs where com screenings are collected. Buyers should be issued their allocation which will comprise of clean corn and com screenings as prorated among buyers assigned per vessel.

j) Weight moniloring/reconciliation of all stocks should be undenaken at different withdrawal points.

J4 â&#x20AC;˘

SECJ'JON m¡COIIIIODm SPECIFIC GUIDILINIS -8. Com

k) Wilhdrawal scheme at Manila port should be as follows: i)

Ex-vessel/clamshi!II withdrawal: For all ex-vessel withdrawals. lhl! discharging rate should be based on lhl! -con1rac1 of supply'" with supplier. A corresponding dl!murragt pt:nally based on1he actual contrac1 of supply with foreign supplier should be imposed if h:irges arc not positio.ned alongside vessel as schl!JUll!J :ind the Jisdt:ir~e rate nm auained or if1he barg.l!s are not towcJ within two hours after completion of the loading. Fl,rex-vl!ssel withdrawals, actual quantity should he based on thl! final ouuurn at buyers silo of NFA- designated truck scales subjecl to the i.:alihration ttst of scales and based on the cenifo.:ate of wdg.ht and 4uali1y to be issued by an independent international surveyor.

ii) Ex-bagging withdrawal: For all ex-hagging withdrawals . MAV l.kensces should withdraw the yellow corn as schcJulcd otherwise. pt:nalticsshouldalsohc..:h:1r~cd . 1=.ii lurc to withdraW con1racted volume on ti1ne shl1uld mean forfeiture of their slot; hence, withdrawal should instead he undertaken ex-warehouse with corresponding additiom,I inciden1al costs. iii) Ex-warehouse withdrawal : For all ex-warehouse withdrawals, MA V licensees should withdraw the contracted volume of yellow

SICTION IU . COIIIIODm sncmc OUIDIUNBS . ,. Con,

â&#x20AC;˘

J~

l>AAd111111n1r11111·,· (h·c/,·,· \,, 'J

fl/ .Juli /YYfl

\',•n,•, "//YYfJ

corn "· NFA-designated warehouses within seven 0) <lays, from 8:00 am - 5:00 pm. Monday to Sa1un.lay. A corresponding penally of P0.50/bag/ <lay shoulc.J he charged in case 1he MAV licensees fail 10 withdraw 1hc contracted volume within the s1ipula1ed period I) Payment scheme should he undertaken as follows: i)

P,1ymen1 should either he in Cash or in Manager's or C'ashier·s Check in favor of NFA at its Metro Manil:1 Office. Finance Depanmentat United Nations Ave .. M;mila. for the following: I)

Performance Security equivalent 10 P 1.00 per kilo of lhe allocated volume.

~I

Re111<1i11ing halance he1ween total cost plus im.:it.Jcmal expenses less advance payments made if Nr-A intcgratcJ rates were availed.

J) Remaining balance between total cost less ac.Jvance payments made if the buyer hired ct,mmon imegraled services ccintractor. ii) Performance Security payment should be made wi1hin 1hree days upon the endorsement of the MA VIC. Payment of remaining balance should be made within 48 hours after receipl of the Notice of Payment from the DA through the NFA. Failure to pay within the slipulated period would allow the seller to resell the equivalent volume of the allocated

36

+

Slt"rlON m-COIIIIODm SPICiftC GOIDILOO!S · J: Com

com. Incidental expenses incurred by NFA should be charged to buyer.

iii) PaymeIll should be for the whole volume of imported yellow com allocated.

SECTION IV THE COMPETITIVENESS ENHANCEMENT FUND AND DISPOSITION THEREOF

1.

Source of Fund. The Competi1iveness Enhan~emeni Fund (CEF) is created with the revenues from in-qu~11a import duties collected from ihe importation of the minimum access volumes, including rice if this had not been waived for food security purposes. The fund is deposited with the Na1ional Treasury and is earmarked by Congress for irrigation. farmto-market roads, post-harvest equipment and facilities. credit, research and development, other marketing: infrastructure. provision of market information, retraining. ex1c:nsion services, and other forms of assistance and !-upport to the

agriculcural sector in so far as these measure:,; an: consistent with AMex 2 of the Agreemen1 On Agriculture in 1he Uruguay Round Final Act and help in improving the competitiveness of the agriculture sector. The ACEF shall have a life of nine (9) years, after which all remaining balances shall revert to lhe General Fund.

2. General Principles. The allocation and use of lhe CEF should be guided by the following principles:

SICTION 111 ¡ COIIIIOlffl BPICIFIC UUJDBUNIS ¡ 8. Com

. . J7

DA AdmiJu!ITaliw Ord,,r No. 9

01 July /996

S.ri~1 of 1996

6. Project /mple1111ntarion. The lead agency in implementing the projects/programs funded by the CEF will be the Department of Agriculture.

AI

40 •

SIC'l10N IV · COIIPB'l'mVIJ(ISS IJflWfCIIIDT PmlD

....-.-p ... & Lay-cut by the