THE AGRICULTURE AND FISHERIES MODERNIZATION
ACT OF 1997
1.
When
was the Agriculture and Fisheries Modernization Act enacted into law?
The Agriculture and Fisheries Modernization Act (AFMA) of 1997
(Republic Act 8435) was
passed by the Senate and the House of Representatives on
December 15, 1997 and December
16, 1997, respectively. It was
signed into law by then President Fidel V. Ramos on
December 22, 1997.
2.
What
are the main objectives of AFMA?
a)
To modernize the agricultural and fishery sectors by transforming
these sectors from a resource-based to a technology-based industry;
b)
To enhance profits and incomes in the agricultural and fishery sectors,
particularly of the small farmers and fisherfolk by ensuring equitable access to
assets, resources and services, and promoting higher-value crops, value-added
processing, agribusiness activities, and agro-industrialization;
c)
To ensure the accessibility, availability and stability of food supply at
all times;
d)
To encourage horizontal and vertical integration, consolidation and
expansion of agricultural and fishery activities, groups, functions and other
services through the organization of cooperatives, farmers’ and fisherfolk’s
associations, corporations, nucleus estates, and consolidated farms and to
enable these entities to benefit from economies of scale, afford them a stronger
negotiating position, and enable them to pursue more focused, efficient and
appropriate research and development efforts;
e)
To promote people empowerment by strengthening people’s organizations,
cooperatives and NGO’s, and by establishing and improving mechanisms and
processes for their participation in government decision-making and
implementation;
f)
To pursue a market-driven approach to enhance the comparative advantage
of our agricultural and fishery sectors in the world market;
g)
To induce the agricultural and fishery sectors to continuously ascend
the value-added ladder by subjecting their traditional or new products to
further processing in order to minimize the marketing of raw, unfinished or
unprocessed products;
h)
To adopt policies that will promote industry dispersal and rural
industrialization by providing incentives to local and foreign investors for
them to establish industries that have backward linkages to the country’s
agricultural and fishery resource bases;
i)
To provide social and economic adjustment measures that increase
productivity and improve market efficiency while ensuring the protection and
preservation of the environment and equity for small farmers and fisherfolk; and
j)
To improve the quality of life of all sectors.
3.
What are
the trade and fiscal incentives provided under AFMA?
Section 109 of the said law provides that all enterprises engaged in
agriculture and fishery duly certified by the Department of Agriculture in
consultation with the Department of Finance and the Board of Investments (BOI)
shall, for five (5) years, be exempted from the payment of tariff duties on all
types of imported agricultural and fishery inputs, equipment and machinery
including, among others, fertilizers, insecticides, tractors, hybrid seed, farm
implements and machinery, packaging machinery and materials, and fishing
equipment and parts thereof, provided that the imported agriculture and fishery
input, and/or equipment shall be for the exclusive use of the importing
enterprise.
4.
Who are
eligible for exemption from the payment of import duties of agricultural and
fishery Inputs, equipment and machinery as provided for under Section 109 of
Republic Act 8435?
a)
Agricultural sectors;
b)
Cooperatives;
c)
Farmers and fisherfolk;
d)
Farmers and fisherfolk organizations and associations;
e)
Fishery enterprises;
f)
Fishery sectors; and
g)
Import consolidators.
5.
When
is the effectivity and the implementation period of the duty exemption on
agricultural and fishery inputs?
Section 109 of RA 8435 states that all enterprises engaged in
agriculture and fishery as duly certified by the Department of Agriculture in
consultation with the Department of Finance and the Board of Investment, shall
for five (5) years after the effectivity of this Act, be exempted from paying
the tariff duties on imports of all types of agriculture and fishery inputs.
To
implement the above, the following were issued:
o
Joint Department Administrative Order (JDAO) No. 1, signed on
December 7, 1998 and took effect on
January 1, 1999.
o
Executive Order No. 133, signed in July 1999 and took effect on
September 25, 1999, revoking JDAO No. 1. It prescribed the Implementing Rules
and Regulation (IRR) on the duty exemption importation of agriculture and
fishery inputs.
o
Executive Order No. 127, signed in September 2002 and became
effective on October 5, 2002, revising the product lists indicated in EO 133.
The five (5)-year period implementation of the duty-free
importation under this Act ended on February 8, 2003.
6.
What are
the actions being taken by the government to continue implementing duty
exemption law accorded by the AFMA?
Executive
Order No. 196, issued on
April 16, 2003 and took effect on April 27, 2003,
reduced to 1% ad valorem the tariff rates on some products entitled to
duty exemption as listed in EO 127.
Senate
Bill Nos. 1669 and 1776, seeking to extend for another five (5) years
the duty exemption importation under the AFMA as well as
the privilege to VAT free importation
thereof, were filed by Senators Edgardo Angara and Ralph Recto. The counterpart
House Bill Nos. 5665 and 5712 were
also filed by Congressmen Herminio G. Teves, Erwin L. Chiongbian and Darlene R.
Antonio-Custodio.
7.
What is
the role of the Tariff Commission in the AFMA?
a)
The Commission actively participated in the preparation of the IRR of the
AFMA, particularly in the preparation of the product list in consultation with
concerned government agencies and the private sector.
b)
The Commission conducted public hearings on January 25, 1999, December
14, 2000, June 28, 2001 and January 21, 2003 to provide interested parties the
opportunity to be heard since there may be local manufacturers/producers
adversely affected by the IRR.
c)
Through the conduct of public hearings, the Commission actively engaged
in the review of the IRR and the product coverage.
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