Creation of Footwear and Leather Goods Development Board

August 7, 1985

EXECUTIVE ORDER NO. 1046

PROVIDING FOR THE ACCELERATED DEVELOPMENT OF THE FOOTWEAR, LEATHER AND LEATHER-GOODS MANUFACTURING INDUSTRIES AND CREATING THE FOOTWEAR AND LEATHERGOODS DEVELOPMENT BOARD

WHEREAS, footwear and leather-goods are among the priority export products in which the country has substantial comparative advantages in international markets;

WHEREAS, the accelerated growth of exports of footwear and leather-goods will contribute meaningfully to the country's economic recovery program;

WHEREAS, the full development of the footwear, leather and leather-goods manufacturing industries continues to be hampered by the inadequacy of locally produced raw materials as well as the difficulty of assuring the stable supply of imported raw materials, components, supplies and accessories needed to produce quality and cost-competitive goods both for the domestic and international markets;

WHEREAS, the footwear, leather and leather-goods manufacturing industries also need skilled manpower, technicians and designers in order to develop high quality products with assured cost-competitiveness in both the domestic and international markets;

WHEREAS, the government seeks to encourage investments in the footwear, leather and leather-goods manufacturing industries through, among others, the granting of various incentives;

WHEREAS, there is a need to coordinate the efforts of all government agencies involved with the development of the footwear, leather and leather-goods manufacturing industries.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of the Philippines, by virtue of the powers vested in me by the Constitution and Presidential Decree No. 146, do hereby order and ordain:

SECTION 1. Footwear and Leather-goods Export Development Board. — There is hereby created a Footwear and Leather-goods Export Development Board (Board).It shall be a corporate body charged with accelerating the development of the footwear, leather and leather-goods manufacturing industries.

SECTION 2. Powers and Functions. — The Board shall have the following powers and functions:

a. In cooperation with other government offices, agencies and instrumentalities as well as with the private sector, it shall set the policies for the development of the footwear leather and leather-goods manufacturing industries. Accordingly, it shall regulate and monitor all aspects of those industries consistent with policies and programs of the national government. DETACa

b. It shall issue licenses for the establishment and operation of all footwear, leather and leather-goods bonded manufacturing warehouses, and authorize the importation of raw materials, supplies, chemicals, packages, brands, labels and accessories, whether on consignment or otherwise, without taxes and duties but under re-export bond provided they are manufactured or processed, either directly or through sub-contractors or other exporters into finished goods for re-export, authorize the importation, without duties but under re-export bond, of machinery and equipment to be used in bonded manufacturing warehouses.

c. It shall provide on a regular basis the necessary information and statistics relating to the administration of footwear, leather and leather-goods export quotas and the flow of the exportation of these products, for monitoring purposes and in order to obtain maximum benefits from negotiations with other countries.

d. It shall inspect and examine, through its authorized personnel, books, records, shipments, importations or inventories of footwear, leather and leather-goods raw materials, equipment, supplies and accessories, including those in the export processing zones, for the purpose of determining compliance with its rules and regulations.

e. It shall fix and collect reasonable fees for its services.

f. Whenever warranted, it shall negotiate, conclude and implement footwear, leather and leather-goods agreements, whether bilateral or multilateral between the Republic of the Philippines and other countries, and for this purpose it shall approve quota allocations and export authorizations when required.

g. It shall undertake development and promotion of footwear, leather and leather-goods exports to maximize benefits from international agreements and hereby hasten the diversification and expansion of export markets.

h. It shall adopt standard rates for tax credits and duty drawbacks for raw materials forming part of footwear and leather export products.

i. In cases of violations of its rules and regulations, it may cancel or suspend quota allocations, export authorizations and licenses for the operation of handed manufacturing warehouses. In such cases, it may, after due hearing, impose administrative penalties, including fines which in no case shall be less than one thousand pesos. The Board shall have the same power to punish direct and indirect contempt under Rule 7 of the Revised Rules of Court granted to superior courts, as well as the power to issue subpoena and subpoena duces tecum.

j. It shall operate a leather and leather-goods training center.

k. It shall promulgate the necessary rules and regulations, to implement the provisions of this Executive Order.

l. It shall perform such other functions as may be necessary for the effective implementation of this Executive Order.

SECTION 3. Composition. — The Board shall be composed of the following:

a. Minister of Trade and Industry as Chairman;

b. Deputy Minister of Finance;

c. Deputy Minister of Labor and Employment;

d. Executive Director of the National Manpower and Youth Council;

e. Commissioner of the Bureau of Customs;

f. Vice-Chairman of the Board of Investments;

g. Administrator of the Export Processing Zone Authority;

h. Director of the Bureau of Foreign Trade; and

i. Two (2) representatives from the private sector elected annually by the Board; as Members.

SECTION 4. Fiscal Incentives. — The Board of Investments shall provide incentives to the footwear, leather and leather-goods manufacturing industries within its Investments Priorities Plan.

SECTION 5. Importation of Raw Materials. — The NDC-NACIDA Raw Materials Corporation shall provide assistance to footwear, leather and leather-goods cottage industries in the importation of raw materials, components, supplies and accessories.

SECTION 6. Audit and Inspection Unit. — To enforce its rules and regulations, the Board is hereby authorized to create its own audit and inspection unit. This unit shall be responsible for conducting regular audit and inspection of all phases of operations of footwear, leather and leather-goods exporters.

SECTION 7. Secretariat. — The Board is hereby authorized to create a Secretariat to be composed of technical as well as administrative staff as may be necessary to assist the Board in the accomplishment of its responsibilities and functions under this Order.

The Secretariat shall be headed by an Executive Director to be appointed by the President of the Philippines upon recommendation of the Chairman.

The regular professional and technical personnel of the Secretariat shall be permanent and career in status.

SECTION 8. Powers and Functions of the Chairman. — The Executive Director and the Secretariat shall be responsible to the Board; Provided, however, That the Chairman shall, on behalf of the Board, exercise direct supervision and control over them. He shall also have the power to appoint and discipline personnel of the Secretariat in accordance with law, subject to confirmation by the Board.

The Chairman shall also approve the agenda for Board meetings, convene and preside over meetings and exercise such other functions as may be delegated to him by the Board.

The Chairman shall designate an Officer-in-Charge to act as Executive Director pending appointment and qualification of an Executive Director and/or where the incumbent Executive Director has been physically and/or mentally incapacitated. He may also designate an organization with private sector participation to manage the day-to-day operation of the training center.

SECTION 9. Administrative Supervision. — The Board shall be under the administrative supervision of Trade Minister of Trade and Industry shall provide funds from its appropriations to be used in the initial operations of the Board. The existing Footwear and Leather-goods Training and Demonstration Center operated by the National Manpower and Youth Council is hereby transferred to the Board together with all its personnel, funds and facilities. aDSIHc

SECTION 10. Per Diems/Compensation. — The Chairman and members of the Board shall be entitled to receive a per diem of five hundred pesos (P500.00) for every meeting actually attended by them: Provided, That the total amount of per diems that any member may receive shall not exceed two thousand pesos (P2,000.00) per month. Compensation for the services of all other personnel shall be determined by the Board.

SECTION 11. Repealing Clause. — All decrees, letters of instructions, laws, orders or rules and regulations inconsistent herewith are hereby deemed repealed/amended accordingly.

SECTION 12. Effectivity. — This Executive Order shall take effect immediately.

DONE in the City of Manila this 7th day of August, in the year of Our Lord, nineteen hundred and eighty-five.