Accelerating the Development of the Tobacco Industry

February 25, 1974

LETTER OF INSTRUCTIONS NO. 166

Pursuant to Proclamation No. 1081 dated September 21, 1972, and in my capacity as Commander-in-Chief of all the Armed Forces of the Philippines, and in order to accelerate the development of the Virginia tobacco industry and to advance the economic well-being of the millions of people who are depending upon it, you are hereby ordered:

1. To regulate, control and supervise the trading of Virginia tobacco which shall be done only at trading centers to be designated by you in strategic places in the North.

2. To conduct research work for the Virginia tobacco industry in all its phases, with particular emphasis on the search for fuel substitutes for flue-curing in view of the energy crisis and forest denudation.

3. In order to augment the income of the tobacco farmers due to the rise on the cost of production, such as: cost of fertilizers, insecticides, and fuel; and considering that the prices of Virginia tobacco prescribed under Republic Act No. 1194 and Presidential Decree No. 62, were determined twenty (20) years ago, you shall also see to it that no person shall buy or sell locally grown flue-cured leaf tobacco at prices lower than the following: cd i

GRADE	PRICE
A	P5.00
B	4.50
C	4.00
D	3.50
E	3.00

4. To carry out the above instructions, you are hereby authorized and directed to collect a research and regulation fee equivalent to four percentum (4%) of the gross purchase price of every kilogram of the flue-cured tobacco sold, to be paid by the producer-seller. No buyer shall deduct a shrinkage allowance in excess of six percentum (6%) of the gross purchase price of the tobacco.

5. To require every trading center operator to contribute to the Philippine Virginia Tobacco Board created under Executive Order No. 331, S. of 1971, the amount of P0.025 per net kilo of tobacco bought at the trading centers, which shall be due and payable at the end of the trading season and shall be used for the improvement of the Virginia tobacco industry. The PVTA shall spend for the same purpose an amount at least equal to whatever is contributed by the trading center operators.

6. To direct the management and operation of trading centers in order to see that a system of recording all tobacco purchased is instituted and that payment to the farmers shall be in cash and not lower than the new schedule of prices. aisa dc

All concerned, particularly the cigarette manufacturers, tobacco redriers and exporters, tobacco entities and producers are enjoined to take notice of this Order.

Any violation of this Order shall mean the outright cancellation, withdrawal, and revocation of the permit to trade, the closure of the establishment involved, as well as the arrest and prosecution of any person concerned. In the implementation hereof, you shall coordinate with the Bureau of Internal Revenue and other proper agencies of the government.

DONE in the City of Manila, this 25th day of February, in the year of Our Lord, Nineteen Hundred and Seventy-Four.