AUTHORIZING ALIENS, AS WELL AS ASSOCIATIONS, CORPORATIONS OR PARTNERSHIPS OWNED IN WHOLE OR IN PART BY FOREIGNERS TO ENGAGE IN THE RICE AND CORN INDUSTRY, AND FOR OTHER PURPOSES

WHEREAS, Republic Act No. 3018 was enacted into law in 1960
to nationalize the rice and corn industry;

WHEREAS, after thirteen (13) years of operation, the law
has to a great extent succeeded in transferring the rice and corn
industry in all its aspects to Filipinos and Filipino-owned entities;

WHEREAS, the existing law has created artificial restraints
in the national effort to develop the rice and corn industry;

WHEREAS, it is imperative to lift the prohibition especially
in cases where grains, including rice and corn and/or by-products
thereof, are used for direct consumption or as raw materials in the
manufacture or processing of their finished products; and

WHEREAS, there is need to encourage foreign investment on a
large scale to develop virgin lands for rice and corn;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the
Philippines, by virtue of the powers in me vested by the Constitution as
Commander-in-Chief of all the Armed Forces of the Philippines and
pursuant to Proclamation No. 1081, dated September 21, 1972, and General
Order No. 1, dated September 22, 1972, as amended, do hereby order and
decree:

SECTION 1. An alien, association, partnership or
corporation, owned in whole or in part by Foreigners, may engage in the
rice and/or com industry.

SEC. 2. As used in this Decree, the term “rice and/or corn
industry” shall include the following activities:

a. Acquiring by barter, purchase or otherwise, rice and com
and/or the by-products thereof, to the extent of their raw material
requirements when these are used as raw materials in the manufacture or
processing of their finished products.

b. Engaging in the culture, production, milling, processing
and trading, except retailing, of rice and corn: Provided, That
the designation of the area in the culture and production, as well as
the trading of the produce in the domestic or foreign markets, shall be
under the direction and control of the National Grains Authority.

SEC. 3. The National Grains Authority may authorize the
alien or business organization mentioned in Section 1 hereof to engage
in the rice and/or corn industry, subject to the following conditions:

a. The National Grains Authority shall certify that there is
an urgent need for foreign investment in the undertaking and that the
same will not pose a clear and present danger of promoting monopolies or
combinations in restrain of trade.

b. The alien, association, corporation or partnership shall have
the necessary financial capability and technical competence.

c. The alien, association, corporation or partnership shall
submit a development plan acceptable to the National Grains Authority.

SEC. 4. A minimum total investment in the undertaking shall
be established from time to time by the National Grains Authority.

SEC. 5. In connection with the foreign equity
participation, at least 60% thereof shall be transferred to Filipino
citizens over a period to be established by the National Grains
Authority, at the time of approval of its authority to engage in the
industry, or phase out its operation within the same period.

SEC. 6. The alien, association, corporation or
partnership shall register with the Securities and Exchange Commission
and the Board of Investments.

SEC. 7. The National Grains Authority shall impose such
other reasonable conditions as may be deemed necessary.

SEC. 8. The National Grains Authority in coordination
with the Department of Agriculture and Natural Resources and other
offices concerned shall issue such rules and regulations as may be
necessary to the implementation of the provisions of this Decree.

SEC. 9. Any violation of this Decree or of the rules or
regulations issued pursuant thereto shall be punished with a fine of
not less than ten thousand pesos and not more than twenty-five thousand
pesos and imprisonment of not less than five years and not more than ten
years. If the violation is committed by a corporation or association,
the penalty shall be imposed upon the president, director or directors,
manager, managing partner, or other official thereof responsible for
such violation. Any alien violating or responsible for such violation of
this Act shall, upon completion of the service of sentence, be deported
without any further proceedings on the part of the Deportation Board.
Any government official or employee who aids, abets or connives with any
person in violating this Act shall, in addition to the penalty which
may be imposed upon him as a principal, be perpetually disqualified from
holding any public office.

SEC. 10. All laws, executive orders and regulations
inconsistent with the provisions of this Decree are hereby repealed.

SEC. 11. This Decree shall take effect upon its
approval.

Done in the City of Manila, this 17th day of May, in the year
of Our Lord, nineteen hundred and seventy-three.