ADDITIONAL GUIDELINES ON THE RENEWAL OF WOOD PROCESSING PLANT PERMITS

To assure wood processing plants of sustained milling operations, the
following additional guidelines in the renewal of permits by the
Regional Executive Director pursuant to DENR Administrative Order No.
38, s. of 1990 are hereby issued for the guidance and compliance of all
concerned:

SECTION 1.       Wood processors without backup
concessions can enter into Log Supply Purchase Agreement (LSPA) only
with holders of existing Timber License Agreements/Provisional Timber
Production Agreements ( TLAs/PTPAs), foreign suppliers and other valid
timber permits/licenses including logs cut from areas covered by Private
Land Timber Permit (PLTP) and Industrial Tree Plantations (ITP)

SECTION 2.       The volume of logs that may be allowed to
be supplied or committed to wood processors by legitimate log suppliers
as provided  for under Section 1 hereof including the latter’s own log
requirements for their own processing plants, should be within the
annual allowable cut (AAC) authorized under the approved Integrated
Annual Operations Plan (IAOP) for the current year.

SECTION 3.       For purposes of monitoring and control of
future log deliveries, the total volume committed by the log suppliers
should be recorded at the Community Environment and Natural Resources
Office (CENRO) to be submitted and consolidated at the Regional Office
copy furnished the Office of the Undersecretary for Field Operations.

SECTION 4.       In case the log supplier does not come
from the same region where the wood processing plant is located, the
CENRO concerned where the timber license area is located shall approve
the LSPA copy furnished the Regional and CENR Offices where the wood
processing plants are located.

SECTION 5.       In cases where the log requirements are
to be satisfied by imported logs, wood processing plant permit shall be
renewed using the LSPA executed by and between the supplier and the
importer, PROVIDED that the effectivity shall commence at the time of
the arrival of the logs.  For this purpose, a schedule of shipments
should be indicated in the LSPA.

SECTION 6.       The wood processing plant must be assured
of log requirement equivalent to a minimum of six months; otherwise,
such permit should not be renewed.  In consonance with Section 10 of
Ministry Administrative Order 50, s. of 1986, wood processing plants
without timber concessions shall have a tenure of a maximum of two
years.

SECTION 7.       Processing of logs coming from sources
other than the approved legitimate log suppliers as provided for under
Section 1 hereof shall be construed as a violation which will subject
the processors to the cancellation of his/her permit.  Such processor is
heretofore disqualified from operating a wood processing plant.

This Order takes effect immediately.

Adopted: 25 July 1990

(SGD.) FULGENCIO S. FACTORAN, JR.
Secretary