AMENDING PRESIDENTIAL DECREE NO. 1467 CREATING THE “PHILIPPINE CROP INSURANCE CORPORATION” BY ADDING PENAL SANCTIONS THEREIN.

WHEREAS, under the Presidential Decree No. 1467, the
Philippine Crop Insurance Corporation was created to provide insurance
protection to farmers against losses arising from natural disasters, as well as
plant diseases and pest infestation;

WHEREAS, it is the policy of the state to provide
integration of the system of crop insurance into the country’s economic and
social development and for this reason has made the participation therein
compulsory for all farmers obtaining production loans for palay under the
supervised credit programs;

WHEREAS, the effective implementation of the compulsory
requirement of the law requires the full support and cooperation of lending
institutions participating in the government’s supervised credit programs;

WHEREAS, to insure the attainment of the objective of the
law, there is a need to strengthen Presidential Decree No. 1467 by defining
therein the duties and obligations of the said lending institutions and
providing penal sanctions for violation of the provisions of said decree;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the
Philippines, by virtue of the powers in me vested by the Constitution, do hereby
decree and order:

SECTION 1. Section 4 of Presidential Decree No. 1467 is
hereby amended to read as follows:

“SECTION 4. Who shall be insured. – Participation
in the palay crop insurance shall be compulsory for all farmers obtaining
production loans for palay under the supervised credit program and optional on
the part of self-financed farmers provided that they agree to place themselves
under the supervision of agricultural production technicians. No lending
institution shall approve or grant production loan for palay under the
supervised credit program unless the same is covered by a crop insurance
pursuant to his Decree. The term “supervised credit program” as used in this
Decree shall mean the production credit program wherein the farmer who obtained
production loans for palay agrees in writing that he will apply proven farm
practices necessary to conserve the land, improve its fertility and increase its
production, and abide by the approved farm plan and budget jointly prepared by
him and the duly accredited supervised credit technician. The term “supervision
of agricultural production technician” shall mean the supervision undertaken by
agricultural production technicians who are duly accredited by the appropriate
government agencies concerned, as required under the supervised credit
system.”

SECTION 2. A new section is inserted between Section 14 and
15 of the said Decree, to be designated as Section 14-A which shall read as
follows:

“SECTION 14-A. All lending institutions granting production
loans for palay under the supervised credit program of the government shall
automatically act as underwriters for and on behalf of the corporation. As such,
they shall receive and process applications for insurance coverage; approve
those found in order and collect premiums therefore. Premiums so collected,
together with the premium payable by the lending institution itself, shall be
remitted to the corporation in the manner and within such period as may be
prescribed by the corporation.”

SECTION 3. A new section is inserted between Sections 18 and
19, to be designated as Section 18-A, which shall read as follows:

“SECTION 18-A. Any person or entity granting production loan
for palay under the supervised credit program of the government without
requiring crop insurance therefore or having collected premiums from farmers,
would fail to remit the same within the time and place specified in the rules
and regulations of the corporation shall, upon conviction, be punished by a fine
not exceeding Ten Thousand Pesos (P10,000.00) or imprisonment of not exceeding
six (6) months, or both, at the discretion of court.

“Any person or entity who shall violate any provision of this Decree or any
rules and regulations issued for its implementation, for which no penalty is
provided, shall be deemed guilty of a penal offense, and upon conviction, be
punished by a fine not exceeding five thousand Pesos (P5,000.00) or imprisonment
of two (2) months, or both, at the discretion of the court.

“Whenever any violation of the provisions of this section is committed by a
corporation or association, or by a government office or entity, the executive
officer or officers of said corporation, association or government office or
entity who shall have knowingly permitted, or failed to prevent, said violation
shall be held liable as principal.”

SECTION 4. All existing laws, rules and regulations which
are inconsistent herewith are hereby repealed or amended accordingly.

SECTION 5. This Decree shall take effect immediately.

Done in the City of Manila, this 21st day of October, in the year of Our
Lord, nineteen hundred and eighty.

			(Sgd.) FERDINAND E. MARCOS President of the Philippines
	By the President:
	(Sgd.) JUAN C. TUVERA
		Senior Presidential Assistant