BUSINESS FINANCIAL
ASSISTANCE
REPUBLIC OF THE PHILIPPINES
QUESTION :
IS THERE ANYONE WHO CAN HELP YOU FINANCIALLY IN SETTING UP
A
BUSINESS?
ANSWER :
YES, THE BARANGAY MICRO BUSINESS ENTERPRISE LAW
THIS IS A COPY FROM
THE EMAIL SENT BY THE DEPARTMENT OF TRADE AND INDUSTRY ON APRIL 15, 2013
DEPARTMENT ADMINISTRATIVE
ORDER NO. 01
Series of 2003.
SUBJECT: Implementing Rules and Regulations of R.A.
9178, Otherwise known as the “Barangay Micro Business Enterprises (BMBEs) Act
of 2002”
Pursuant
to Sec. 15 of R.A. 9178, otherwise known as the “Barangay Micro Business
Enterprises (BMBEs) Act of 2002”, and after consultation with the Department of
the Interior and Local Government (DILG), the Department of Finance (DOF) and
the Bangko Sentral ng Pilipinas (BSP), and other concerned agencies, the
following rules and regulations governing BMBEs are hereby prescribed for the
compliance, information and guidance of all concerned.
I. PRELIMINARY PROVISIONS
Sec. 1. Declaration of Policy. – As stated
in Sec. 2 of R.A. 9178, it is the policy of the State to hasten the country’s
economic development by encouraging the formation and growth of barangay micro
business enterprises which effectively serve as seedbeds of Filipino entrepreneurial
talents, and integrating those in the informal sector with the mainstream
economy, through the rationalization of bureaucratic restrictions, the active
intervention of the government specially in the local level, and the granting
of incentives and benefits to generate much-needed employment and alleviate
poverty.
Sec. 2. Definition of Terms. – When used
herein, the term:
a.
Act- shall refer to the “Barangay Micro Business Enterprises Act of 2002”.
b. Barangay Micro Business Enterprise (BMBE) – as defined in Sec.
3a of the Act,shall refer to any business entity or enterprise engaged in the production, processing
or manufacturing of products or commodities, including agro-processing,
trading and services, whose total assets including
those arising from loans but exclusive of the land on which the particular
business entity’s office, plant and equipment are situated, shall not be more than Three
Million Pesos (P3,000,000.00) subject to review and upward adjustment by the
SMED Council, as mandated under Republic Act 6977, as amended by Republic Act 8289. A BMBE shall include any individual owning such business entity/enterprise, partnership, cooperative, corporation, association
or other entity incorporated and/or organized and existing under Philippine
laws; and registered with the office of the treasurer of a city or
municipality in accordance with this implementing rules and regulations.
“Services” shall exclude those rendered by any one, who is duly
licensed by the government after having passed a government licensure
examination, in connection with the exercise of one’s profession as stated in
Paragraph 2 Sec. 3(a), R.A. 9178.
c.
Certificate of Authority (CA) – shall refer to the certificate issued to an
applicant authorizing the same to operate as a BMBE and to be entitled to the benefits and
privileges accorded to a registered BMBE.
d. Assets – shall refer to all kinds of properties, real or
personal, owned by the BMBE and used for the conduct of its business as defined by the
SMED Council: Provided, That for the purpose of exemption from taxes and fees under the
Act, this term shall mean all kinds of properties, real or personal, owned and/or used by
the BMBE for the conduct of its business as defined by the SMED Council.
e. Registration – shall mean the inclusion of a BMBE in the BMBE Registry of a city or
municipality.
f. Financing – shall refer to all borrowings of the BMBE from all sources after registration.
II. REGISTRATION OF BMBE
Sec. 3. Place of Registration. – The
Office of the Treasurer of each city or municipality shall register BMBEs and
issue a Certificate of Authority (CA) to enable the BMBE to avail of incentives
under the Act; Provided, That only one Certificate of Authority shall be issued
for each BMBE and only by the Office of the Treasurer of the city or
municipality that has jurisdiction over the principal place of business of the
BMBE.
Sec. 4. Who are eligible to register. –
Any person, natural or juridical, cooperative or association, having the
qualifications herein below enumerated, may apply for registration as BMBE:
a.
Have an asset size of not more than three million pesos (P3,000,000.00)
excluding land, before applying for BMBE registration; and
b.
Engaged in the business activities as defined in Sec. 2(b) of this IRR.
Sec. 5.
Requirements for Registration. The applicant for BMBE registration shall submit
the duly filled up application (BMBE Form 01) in triplicate, signed by the
owner or manager of the entity applying for registration.
Sec. 6. Procedures for Registration. The
following are the procedures when applying for registration as BMBE:
a.
An applicant for BMBE shall go to the Office of the Municipal or City Treasurer
where the business is located;
b.
The applicant shall accomplish BMBE Form 01 in triplicate and submit to the
Office of the Municipal or City Treasurer;
c.
The Municipal or City Treasurer evaluates the application. Application shall be
processed within fifteen (15) working days upon submission of complete documents.
Otherwise, the BMBEs shall be deemed registered; and
d.
A registered BMBE shall be issued a CA as proof of registration, which will be
effective for a period of two (2) years, renewable for a period of two (2) years for
every renewal.
Sec. 7. Fees and Charges. – The LGUs shall
issue the CA promptly and free of charge. However, to defray the administrative
costs of registering and monitoring the BMBEs, the LGU may charge a fee not
exceeding One Thousand Pesos (P1,000.00).
Sec. 8. Transfer of Ownership. – The BMBE
shall report to the city or municipality of any change in the status of its
ownership structure, and shall surrender the original copy of the BMBE
Certificate of Authority for notation of the transfer.
III. INCENTIVES AND BENEFITS
Sec. 9. Exemption from taxes and fees. –
All BMBEs shall be exempted from income tax for income arising from the
operation of the enterprise. The Local Government Units (LGUs) are encouraged
either to reduce the amount of local taxes, fees and charges imposed or to
exempt the BMBE from local taxes, fees and charges.
Sec. 10.
Exemption from the Coverage of the Minimum Wage Law. – The BMBEs shall be
exempt from the coverage of the Minimum Wage Law: Provided, That all employees
covered under the Act shall be entitled to the same benefits given to any
regular employee such as social security and healthcare benefits.
Sec. 11.
Credit Delivery. – As stated in Sec. 9 of the Act, the Land Bank of the
Philippines (LBP), the Development Bank of the Philippines (DBP), Small
Business Guarantee and Finance Corporation (SBGFC), and People’s Credit and
Finance Corporation (PCFC) shall set up a special credit window that will
service the financing needs of BMBEs registered under the Act consistent with
the BSP policies, rules and regulations. The Government Service Insurance
System (GSIS) and Social Security System (SSS) shall likewise set up a special
credit window that will serve the financing needs of their respective members
who wish to establish a BMBE. The concerned financial institutions (FIs) are
encouraged to wholesale the funds to accredited private financial institutions
including community-based organizations such as cooperatives, non-government
organizations (NGOs) and people’s organizations, which will in turn, directly
provide credit support to BMBEs. All loans from whatever sources granted to
BMBEs under the Act shall be considered as part of alternative compliance to
Presidential Decree No. 717, otherwise known as the Agri-Agra Law, or to
Republic Act No. 6977, otherwise known as the Magna Carta for Small and Medium
Enterprises, as amended. For purposes of compliance with Presidential Decree
No. 717 and Republic Act No. 6977, as amended, loans granted to BMBEs under the
Act shall be computed at twice the amount of the face value of the loans.
Any
existing laws to the contrary notwithstanding, interests, commissions and
discounts derived from the loans by the LBP, DBP, PCFC and SBGFC granted to
BMBEs as well as loans extended by the GSIS and SSS to their respective member-
employees under the Act shall be exempt from gross receipts tax (GRT).
To
minimize the risks in lending to the BMBEs, the SBGFC and the Quedan and Rural
Credit Guarantee Corporation (QUEDANCOR) under the Department of Agriculture,
in case of agribusiness activities, shall set up a special guarantee window to
provide the necessary credit guarantee to BMBEs under their respective
guarantee programs.
The LBP,
DBP, PCFC, SBGFC, SSS, GSIS, and QUEDANCOR shall annually report to the
appropriate Committees of both Houses of Congress on the status of the
implementation of this provision.
The BSP
shall formulate the rules for the implementation of this provision and shall
likewise establish incentive programs to encourage and improve credit delivery
to the BMBEs.
Sec. 12. Technology Transfer, Production and
Management Training, and Marketing Assistance. – BMBEs can avail of
technology transfer, production, management training programs and
marketing assistance of the DTI, DOST, UP-ISSI, CDA, TESDA, TLRC and other
concerned agencies.
Sec. 13. BMBE Development Fund. – As
stated in Sec. 10 of the Act, a BMBE Development Fund shall be set up with an
endowment of Three Hundred Million Pesos (P300, 000,000.00) from the PAGCOR and
shall be administered by the SMED Council. The DTI, DOST, UP ISSI, CDA, TESDA,
and TLRC may avail of the said fund for technology transfer, production and
management training and marketing assistance to BMBEs.
Sec. 14. Trade and Investment Promotion. –
The data gathered from business registration shall be made accessible to and
shall be utilized by private sector organizations and non-government
organizations for purposes of business matching, trade and investment
promotion.
Sec. 15.
One-Stop Business Registration Center. – LGUs are encouraged to establish a
One- Stop Business Registration to handle the efficient registration and
processing of permits/licenses of BMBEs.
IV. INFORMATION
DISSEMINATION
Sec. 16. Information Dissemination. – The
Philippine Information Agency (PIA) in coordination with the concerned agencies
(DOLE, the DILG, and the DTI) shall ensure the proper and adequate information
dissemination of the contents and benefits of the Act to the general public
especially to its intended beneficiaries in the barangay level.
V. PENALTY
Sec. 17. Penalty. – Any person who shall
willfully violate any provision of the Act or who shall in any manner commit
any act to defeat any provision of the Act shall, upon conviction, be punished
by a fine of not less than Twenty five Thousand Pesos (P25, 000.00) but not
more than Fifty Thousand Pesos (P50, 000.00) and suffer imprisonment of not
less than six (6) months but not more than two (2) years.
In case
of non-compliance with the provisions of Section 9 of the Act, the BSP shall
impose administrative sanctions and other penalties on the
concerned government financial institutions, including a fine of not less
than Five Hundred Thousand Pesos (P500, 000.00).
VI. MISCELLANEOUS PROVISIONS
Sec. 18. Annual Report. – The DILG, DTI,
and BSP shall submit Annual Reports to Congress on the status of the
implementation of the Act.
Sec. 19. Effectivity. – These rules shall
take effect fifteen (15) days after its publication in a newspaper of general
circulation.
APPROVED:
07 February 2003.
Secretary
of Trade and Industry
(Published
in Manila Bulletin February 11 and 26, 2003)
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