H. No. 771 / 47 OG No. 8, 3918 (August, 1951)

[ REPUBLIC ACT NO. 663, June 16, 1951 ]

AN ACT TO DEVELOP AND IMPROVE THE RICE AND CORN INDUSTRIES, TO STABILIZE THE PRICE OF RICE AND TO PROMOTE THE SOCIAL AND ECONOMIC CONDITIONS OF THE PEOPLE ENGAGED IN THE PRODUCTION OF THESE STAPLE FOODS.

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:SECTION 1. For the purpose of developing and improving the rice and corn industries in all their phases, of stabilizing the prices of rice and corn, and of promoting the social and economic conditions of the people who are engaged in the production of these staple foods, a corporation is hereby created which shall be known as the National Rice and Corn Corporation and shall be referred to herein as Corporation. All assets and liabilities of the defunct NARIC which were turned over to the PRISCO by virtue of Executive Order No. 350 are hereby transferred to this new Corporation. The National Rice and Corn Corporation shall be organized within one month after the date of the approval of this Act and shall exist for a term of thirty years from the said date. The Corporation shall have its main office in the City of Manila.SEC. 2.

1. The Corporation shall carry out its development work not by any form of regimentation, but thru-
   
   1. Education, inducements and actual practical demonstrations ;
   2. Promotion of initiative of, and cooperation among, the people;
   3. Facilities and guidance; and
   4. The help of existing Government agencies and private institutions.
2. The Corporation shall carry out its stabilization work thru-
   
   1. The maintenance of a stable price consistent with the average cost of production, with the purchasing power of the people, and with the. national economic policy of the Government;
   2. The prevention of speculation in trading and of the exploitation of the consumers;
   3. The financing of producers of the raw products as well as of other activities of the industries needing such assistance;
   4. The study, promotion and execution of such measures as will improve the quality and unit yield as well as improve and reduce the cost of production, handling, storage, conservation, processing, transportation and general trading of rice, corn, and their by-products;
   5. The study, promotion, and establishment of such industries as will make the most use of the by-products of the industry and produce commodities of economic importance to the people;
   6. The study, promotion and execution of such measures as will improve the nutritive value and assimilability of rice and corn as well as of their by-products;
   7. The study, promotion and execution of such measures as will solve the problems that may arise from over production of rice and corn.
3. The Corporation shall carry out its work of promoting the economic and social conditions of the people engaged in the production of rice and corn thru-
   
   1. General agricultural development, industrialization of agricultural products and promotion of home industries in the rice and corn producing regions,
   2. Promotion of cooperative associations among them.

SEC. 3. For carrying out the foregoing objectives, the Corporation shall have authority-

1. To act as the agent or instrumentality of the Government in any of its governmental, social or civic functions in such a manner and under such conditions as may be prescribed by law or by executive order or proclamation;
2. To buy, sell, import, export, deal in, barter, exchange and handle in every other manner, rice and corn, as well as the by-products of said cereals;
3. To own, lease, operate or otherwise hold, subject to existing laws, trucks, railway lines and any other means of transportation, elevators, mills, factories, irrigation systems, power plants, machinery and equipment of all kinds, and warehouses and structures of every nature and kind for the protection, storage, handling, processing, utilization, and sale of rice and corn and other agricultural products, and of other commodities necessary for development work;
4. To give loans on reasonable terms, and finance activities in the rice and corn industries;
5. To borrow, or raise or secure money and to mortgage or otherwise encumber any property belonging to the Corporation or otherwise give security therefor;
6. To enter into, make, perform and carry out contracts of every class and description necessary or incidental to the realization of its purpose with any person, firm, or corporation, private or public, and with any foreign government;
7. To have one or more offices outside of the Philippines, and to conduct its business and exercise its powers in any part of the Philippines or in any foreign country, State or territory;
8. To undertake research on industrialization, conservation and better utilization of agricultural products;
9. To study and promote home industries among the families engaged in the production of rice and corn;
10. To exercise, in the name of the Republic of the Philippines, the right of eminent domain, and in the purchase of any real estate or the acquisition of real estate by condemnation proceedings, the title to such real estate shall be taken in the name of the Republic of the Philippines, and thereupon all such real estate shall be entrusted to the Corporation as the agent of the Republic of the Philippines to accomplish the purposes of this Act: Provided, That such exercise of the right of public domain shall be resorted to only after the Corporation has completely failed to purchase such real estate at a price deemed reasonable by the Board of Directors;
11. To procure and sell or donate fertilizers and lime, to be fairly and equitably distributed through the agency of provincial demonstration agents, Department of Agriculture, agricultural college, or otherwise as the Board of Directors may direct, for experimentation, education, and introduction of the use of such fertilizers and lime in cooperation with practical farmers so as to obtain information as to the value, effect, and best methods of their use;
12. To establish its own demonstration farms and to arrange with farmers and farm organizations for the large-scale practical use of fertilizers and lime under conditions permitting an accurate measure of the economic return they produce, with the provision that said farmers and farm organizations shall keep records of the farm methods and performance, which records shall be open to the public;
13. To cooperate with National, provincial and school experimental stations or demonstration farms, with farmers, landowners, tenants and associations of landowners, tenants, and farmers for the use of fertilizers and lime, or fertilizing and liming practices, and for promoting the prevention of soil erosion by the use of fertilizers or otherwise;
14. To request the assistance and advise of any officer, agent or employee of any Executive Department or of any independent office of the Republic of the Philippines, to enable the Corporation to better carry out its powers successfully, and as far as possible, utilize the services of such officers, agents, and employees, and the President of the Philippines shall, if in his opinion, the public interest, service or economy so require, direct that such assistance, advice and service be rendered to the Corporation, and any individual that may be directed by the President to render such assistance, advice and service shall, thereafter be subject to the orders, rules and regulations of the Corporation : Provided, That any invention or discovery made by virtue of and incidental to such service by an employee of the Government of the Philippines serving under this section, or by any employee of the Corporation, together with any patents which may be granted thereon, shall be the sole and exclusive property of the Corporation, which is hereby authorized to grant such licenses thereunder as shall be authorized by the Board of Directors: Provided, further, That the Corporation may pay to such inventor such sum from the income from sale of licenses as it may deem proper;
15. To adopt and undertake such measures as will improve the economic and social conditions of the people engaged in the production of rice and corn;
16. Generally, to do all such other things and to transact all such business as may be directly or indirectly incidental or conducive to the attainment of the purposes of the corporation; and
17. To do, in carrying on its business, any and all acts and things and to exercise any and all powers which a natural person should do and exercise and which now or hereafter may be authorized by law.

SEC. 4. The National Rice and Corn Corporation shall be subject to the provisions of the Corporation Law in so far as they are compatible with the provisions of this Act, and it shall enjoy the general powers mentioned in said Corporation Law in addition to those herein specified. SEC. 5. In order to enable the Corporation to exercise the powers and duties vested in it by this Act-

1. The Corporation is hereby exempted from the payment of import duty on rice and corn, and on such supplies, machinery and equipment such as fertilizers and lime as may be necessary for demonstration farming.
2. The Corporation is hereby exempted from the payment of sales and milling taxes imposed or to be imposed by the National, or by any provincial or municipal governments, and the President of the Philippines is hereby authorized to further exempt the Corporation from the payment of other taxes whenever in his opinion such exemption is for public interest.
3. The President of the Philippines is hereby authorized to transfer and assign to the Corporation, the parcels of land belonging to the Government and situated in the City of Manila bounded on three sides by Azcarraga Street, Quezon Boulevard and Evangelista Street, more specifically described as Lots Nos. 1, 2, 3, 4, 5 & 6, Block 2181, containing 9,398 square meters and such other real or personal property of the Republic of the Philippines as he may from time to time deem necessary and proper for the purposes of the Corporation.
4. The Corporation is hereby authorized to inspect and take records of palay, rice and corn stocks stored by any person, partnership or corporation, and to enter the premises where these commodities may be found, for such inspection and records.

SEC. 6.

1. In the appointment of officials and selection of employees for the said Corporation, and in the promotion of any employees or officials, no political test or qualifications shall be permitted or given consideration, but all such appointments and promotions shall be given and made on the basis of merit and efficiency. Any member of the Board of Directors who is found by the President of the Philippines to be guilty of a violation of this section shall be removed from office by the President of the Philippines, and any appointee of said Board who is found by the Board to be guilty of a violation of this section shall be removed from office by said Board.
2. The Board of Directors shall establish and prescribe its own rules, regulations, standards and records for the employment, promotion, demotion, removal, transfers, welfare, compensation and appraisal of performance of employees and officers of the Corporation, and provide a system of organization to fix responsibility and promote efficiency.

SEC 7.

1. The capital stock of the Corporation shall be twenty million pesos divided into two "hundred thousand shares of stock, having a par value of one hundred pesos each,
2. All of the stocks of the Corporation shall be subscribed by the Government of the Republic of the Philippines excepting such number of stocks as may necessarily be sold to the members of the Board of Directors. Fifty per cent of the value of stocks subscribed shall be paid immediately; 10 per cent on or before July, 1951; 10 per cent on or before July 1, 1952; and 10 per cent on or before July 1, 1953. Payment of the balance shall be subject to call by the President of the Philippines upon recommendation of the Board of Directors. Stocks sold to any member of the Board may be purchased by the Government of the Republic of the Philippines at par value when he ceases to be a member of said Board.
3. The voting power of all such stocks owned by the Government of the Republic of the Philippines shall be vested in the President of the Philippines or in such person or persons as he may designate.

SEC. 8.

1. The Corporation shall, at all times, maintain complete and accurate books of accounts, which shall be segregated under three main accounts namely;Account No. 1-Pertaining to the Corporation's activities in the stabilization of prices.Account No. 2-Pertaining to the Corporation's activities in developing and improving production.Account No. 3-Pertaining to the Corporation's activities in promoting the economic and social conditions of the people engaged in the production of rice and corn.
2. The Board of Directors shall submit its annual report and balance sheets to the President of the Philippines and the Congress of the Philippines as provided for in section five hundred and seventy-four to five hundred and seventy-seven of the Administrative Code.
3. All purchases and contracts for supplies or services, except for personal services, made by the Corporation, shall be made after advertising in such a manner and at such times sufficiently in advance of opening of bids as the Board shall determine to be adequate to in sure notice and opportunity for competition: Provided, That advertisement shall not be required when, (1) an emergency requires immediate delivery of the supplies or performance of the service; or (2) repair parts, accessories, supplemental equipment, or services are required for supplies or services previously furnished or contracted for; or (3) the aggregate amount involved in any purchase of supplies or procurement of services does not exceed P1,000, in which cases such purchases of supplies or procurement of services may be made in the open market in the manner common among businessmen: Provided, further, That in comparing bids and in making awards the Board may consider such factors as relative quality and adaptability of supplies or services, the bidder's financial responsibility, skill, experience, record of integrity in dealing, ability to furnish repairs and maintenance services, the time of delivery or performance offered, and whether the bidder has complied with the specifications: Provided, further, That in case supplies may be procured from a government, domestic or foreign, and it can be established to the satisfaction of the Board that the Government price is the lowest possible, considering quality and period of delivery, the Board may allow purchases from the Government without public bidding.
4. The Auditor General shall audit the transactions of the Corporation at such times as he shall determine, but not less frequently than once each governmental fiscal year, with personnel of his selection. In such connection, he and his representatives shall have free and open access to all papers, books, records, files, accounts, plants, warehouses, offices, and all other things, property, and places belonging to or under the control of or used or employed by the Corporation, and shall be afforded full facilities for counting all cash and verifying transactions with, and balances in, depositaries. He shall make report of each such audit in quadruplicate, one copy for the President of the Philippines, one for the Chairman of the Board, one for public inspection at the principal office of the Corporation, and the other to be retained by him for the uses of the Congress: Provided, That such report shall not be made until the Corporation shall have had reasonable opportunity to examine the exceptions and criticisms of the Auditor General, to point out errors therein, explain or answer the same, and to file a statement which shall be submitted by the Auditor General with his report. The expenses for each such audit shall be paid from any appropriation or appropriations for the General Auditing Office, and such part of such expenses as may be allocated to the Corporation shall be reimbursed promptly by the Corporation as billed by the Auditor General. The Auditor General shall make special reports to the President of the Philippines and to Congress of any transaction or condition found by him to be in conflict with the powers or duties entrusted to the Corporation by law.

SEC. 9.

1. The management of the National Rice and Corn Corporation shall be vested in a Board of Directors consisting of five members appointed by the President of the Philippines, with the consent of the Commission on Appointments. The President of the Philippines shall appoint the Chairman of the Board from among its members. The Board shall appoint a General Manager and an Assistant General Manager who need not be members of the Board.
2. Of the five directors first appointed as above prescribed, the President of the Philippines shall designate one to serve for one year, one for two years, one for three years, one for four years, and the chairman for five years; and thereafter, each director appointed shall serve for five years. Whenever a vacancy shall occur among the directors, the person appointed to fill it shall hold office for the unexpired term of the member-whose place he is selected to fill.
3. Three members of the Board of Directors shall constitute a quorum for the transaction of business.
4. Any director shall be subject to removal by the President of the Philippines.
5. All members of the Board shall be persons who profess a belief in the feasibility and wisdom of this Act.

SEC. 10.

1. The present National Rice and Corn Corporation as merged with the PRISCO by Executive Order No. 350 is dissolved. Its properties, assets, rights, choses in action, obligations, liabilities, and contracts are transferred to, and are vested in, and assumed by, the public corporation herein created. The business and affairs of the aforecited corporation are liquidated as of the effective date of this Act, and are automatically assumed and continued by the Corporation herein created.
2. The net book value of the properties and assets of the present National Rice and Corn Corporation as merged with the PRISCO by Executive Order No. 350 on the effective date of approval of this Act, shall be received by the Corporation herein created in payment for an equal value of shares of the capital stock of the Corporation herein created.
3. All references made to the National Rice and Corn Corporation referred to above in any Act or in any Executive Order or Proclamation of the President of the Philippines which is still in force shall be deemed to be a reference to the National Rice and Corn Corporation created in this Act.

SEC. 11. To carry out the purposes of this Act, there is hereby appropriated out of the funds of the National Treasury not otherwise appropriated, to be paid and transferred to the Corporation for the stocks subscribed by the Government, as follows: Ten million pesos upon approval of this Act, five million of which shall be taken from the authorized capital appropriation of the PRISCO as share of the RICO Department, PRISCO, activities which will be assumed and continued by this new Corporation; five million pesos less the net book value of the properties and assets of the former National Rice and Corn Corporation, on or before July 1, 1952; and the balance, or five million pesos, on or before July 1, 1953. The total sum to be paid and transferred to the Corporation under the provisions of this Act shall not exceed twenty million pesos. All profits derived from the operation of the Corporation herein created shall accrue to and form part of the same and shall be available for expenditure and/or investment for the same purposes herein provided.SEC. 12. This Act shall take effect one month after its approval.Approved, June 16, 1951.

Source: Supreme Court E-Library