Guidelines on the Registration and Issuance of Permit to Operate for Agricultural and Fisheries Machinery Manufacturers, Fabricators, Assemblers, Distributors, Dealers, Importers, and Exporters

May 8, 2019

DA DEPARTMENT CIRCULAR NO. 04, S. 2019

 

Pursuant to Sections 20 and 24 of Republic Act No. 10601, otherwise known as the Agricultural and Fisheries Mechanization (AFMech) Law and its Implementing Rules and Regulations, this Guidelines on the Registration and Issuance of Permit to Operate for agricultural and fisheries machinery Manufacturers, Fabricators, Assemblers, Distributors, Dealers, Importers, and Exporters is hereby promulgated and issued by the Department of Agriculture-Bureau of Agricultural and Fisheries Engineering (DA-BAFE) to implement the provisions of the said Act, for the guidance, information, and strict compliance of all concerned.

ARTICLE I

General Provisions

SECTION 1. Objective. —

This Circular sets the guidelines of DA-BAFE on the Registration and Issuance of Permit to Operate for Agricultural and Fisheries Machinery Manufacturers, Fabricators, Assemblers, Distributors, Dealers, Importers, and Exporters (MFADDIEs). It aims to regulate the businesses engaged in the manufacture, fabrication, assembly, distribution, dealing, importation, and exportation of agricultural and fisheries machinery. Specifically, it aims to meet the following:

a. Prevent the proliferation of agricultural and fisheries machinery MFADDIE committing any misconduct in manufacturing, fabrication, assembling, distribution, dealing, importation, and exportation of agricultural and fisheries machinery;

b. Establish a national registry of agricultural and fisheries machinery MFADDIEs and machinery supplied in the market;

c. Ensure fair trade practices among MFADDIE and end-users;

d. Provide opportunities for business growth; and

e. Safeguard the interest of the consumers.

SECTION 2. Scope. —

This Circular shall cover the registration and issuance of Permit to Operate (PTO) for MFADDIEs.

SECTION 3. Definition of Terms. —

For the purpose of this Circular, the following definitions are hereby adopted:

a. Agricultural and Fisheries Machinery — refers to machinery and equipment for the production, post-production, harvesting, processing, storage, manufacture, preserving, transporting and distribution of agricultural and fisheries products and by-products. It includes, but not limited to, tractors and their attachments, power tillers, seeders, transplanters, windmills, harvesting machines, crop protection and maintenance equipment, irrigation equipment and accessories, greenhouses and other thermal conditioning equipment, livestock equipment, fishery equipment, slaughtering equipment, meat/fishery and crop processing equipment, postharvest machines such as milling machines, dryers, threshers and fiber extraction machines;

b. Applicant — refers to natural or juridical person engaged or intends to engage in the business of manufacturing, fabrication, assembly, distribution, dealing, importation, and exportation of agricultural and fisheries machinery;

c. Assembler — refers to any person or entity involved in the assembly using locally-made or imported individual parts and components for the production of agricultural and fisheries machinery;

d. Association — an official group of people organized and operated for a joint purpose;

e. Authorized Representative (AR) — refers to the person/s duly authorized by the applicant who is an organic personnel of the company who will be the primary point of contact for all matters relating to the application for registration and permit to operate;

f. Certificate of Conformity (CC) — certificate issued by BAFE which guarantees that the agricultural and fisheries machinery conforms with PNS/BAFS/PABES or other relevant standards identified by BAFE;

g. Classification — refers to the nature of operation of establishments which are categorized based on the product lines and activities done from planning up to selling, including outsourcing of machine parts or components;

h. Corporation — an artificial being created by operation of law, having the right of succession and the powers, attributes and properties expressly authorized;

i. Dealer — refers to an authorized representative of distributors and/or manufacturers to supply, trade, sell and service agricultural and fisheries machinery to end-users;

j. Distributor — refers to any trading entity authorized by foreign or local suppliers and/or manufacturers to distribute agricultural and fisheries machinery to dealers;

k. Establishment — refers to a person, entity, association, partnership, company, corporation or cooperative engaged in the business of manufacturing, fabrication, assembly, distribution, dealing, importation, and exportation of agricultural and fisheries machinery;

l. Exporter — refers to any person or entity who ships/sends agricultural and fisheries machinery to another country for sale;

m. Fabricator — refers to any person or entity that produces agricultural machinery and equipment from prototyping to testing and commissioning and selling. Usually, they produce agricultural machinery and equipment depending on the order and arrangement;

n. Importer — refers to any person or entity who brings agricultural and fisheries machinery into the Philippines, whether or not made in the course of his or trade or business;

o. Inspection — refers to all activities being undertaken by DA-BAFE and DA-RAED for purposes of evaluating and checking the facilities and products of an MFADDIE;

p. Manufacturer — refers to any person or entity that produces agricultural machinery and equipment from conceptualization to prototyping to testing and commissioning and eventually selling. Usually, a manufacturer produces agricultural machinery and equipment in bulk;

q. Partnership — a juridical personality created when two or more persons bind themselves to contribute money, property, or industry to a common fund, with the intention of dividing the profits among themselves;

r. Permit to Operate (PTO) — refers to the privilege granted to any MFADDIE that have passed the review, inspection and evaluation conducted by DA-BAFE and DA-RAED and is allowed to engage in a particular line of activity which include manufacturing, fabrication, assembly, distribution, dealing, importation, and exportation of agricultural and fisheries machinery;

s. Philippine National Standard/Philippine Agricultural and Biosystems Engineering Standard (PNS/PABES) — standards used for the preparation and monitoring of specifications and test and evaluation of machine and equipment performance and serve as technical reference by all Agricultural and Biosystems Engineers (ABEs) in the practice of agricultural and biosystems engineering profession;

t. Product — agricultural and fisheries machinery offered by individual agricultural and fisheries machinery MFADDIE;

u. PTO Holder — refers to any entity that is duly authorized by DA-BAFE to manufacture, fabricate, assemble, distribute, deal, import, and export agricultural and fisheries machinery;

v. Regional Agricultural Engineering Division (RAED) — refers to the division of the Department of Agriculture-Regional Field Office authorized to assist the Department of Agriculture-Bureau of Agricultural and Fisheries Engineering (DA-BAFE) in the enforcement/implementation of the provisions of this Circular;

w. Registration and Permitting — refers to all the processes involved in the review, evaluation, inspection, validation, and approval of documents and facilities for the purpose of legalizing the business operations to manufacture, fabricate, assemble, distribute, deal, import, and export agricultural and fisheries machinery;

x. Sole proprietorship — also referred to as "single proprietorship," a business structure owned by an individual who generally has full control and authority over the business;

y. Standards Regulation and Enforcement Division (SRED) — refers to the division authorized by the DA-BAFE to enforce/implement the provisions of this Circular.

ARTICLE II

Duties and Responsibilities

SECTION 4. Duties and Responsibilities of the DA-Bureau of Agricultural and Fisheries Engineering and DA-Regional Agricultural Engineering Division. —

SECTION 4.1 The DA-BAFE shall undertake the following functions:

• Review the completeness of the documentary requirements of MFADDIEs located in the National Capital Region (NCR);

• Review the veracity and authenticity of all the documentary requirements submitted by the applicants nationwide;

• Conduct on-site inspection and validation of applications prior to the issuance of PTO;

• Issue PTO to applicants who comply with all the requirements of registration;

• Maintain a registry of all MFADDIEs and PTO holders;

• Conduct periodic monitoring of PTO holders in NCR;

• Issue suspension, revocation, withdrawal and cancellation of PTO; and

• Perform other duties and functions relevant to the registration and issuance of PTO to MFADDIEs;

SECTION 4.2 The DA-RAED shall undertake the following functions:

• Initially review the completeness of the documentary requirements of MFADDIEs within their respective regions before endorsing/forwarding the applications to BAFE;

• Assist DA-BAFE in the conduct of on-site inspection and validation of all applications within their respective regions prior to the issuance of PTO;

• Conduct periodic monitoring of PTO holders within their respective regions;

• Perform other duties and functions relevant to the registration and issuance of PTO for MFADDIEs,

SECTION 4.3 The LGU shall undertake the following functions:

• Assist DA-BAFE and DA-RAED in the conduct of on-site inspection, if necessary;

• Assist DA-BAFE and DA-RAED in the monitoring and enforcement of the PTO within their respective cities/municipalities; and

• Perform other duties and functions relevant to the registration and issuance of PTO for MFADDIEs.

Other concerned agencies and offices may be requested to perform duties and responsibilities relative to the recommendation of the registration and issuance of PTO for agricultural and fisheries machinery MFADDIEs, where appropriate.

ARTICLE IIIRequirements for Registration and Issuance of Permit to Operate

All manufacturers, fabricators, assemblers, distributors, dealers, importers, and exporters of agricultural and fisheries machinery shall register with DA-BAFE and apply for the registration and issuance of PTO.

The application for registration and PTO is classification- and location-specific. Establishments which are engaged in different lines of activity or maintain other branches in other locations shall be required to register the same separately with the DA-RAED where the establishment is located.

SECTION 5. New Application. —

5.1 Common Requirements for Both Sole Proprietorship and Corporation/Partnership/Association/Cooperatives

a. Duly accomplished Application Form No. 401;

b. Photocopy of Business/Mayor's Permit from the city/municipality where the establishment is located for the current year;

c. Location map of the establishment;

d. Duplicate copy of official receipt of payment of application fee;

5.2 Additional Requirements for Sole Proprietorship

Photocopy of the Certificate of Business Name Registration issued by the Department of Trade and Industry (DTI).

5.3 Additional Requirements for Corporation/Partnership/Association/Cooperatives

a. Photocopy of the Certificate of Registration issued by the Securities and Exchange Commission (SEC);

b. Article of Incorporation and By-laws and all amendments thereto.

SECTION 6. Renewal. —

Requirements for Both Individual (Sole Proprietorship) and Corporation/Partnership/Association

a. Duly accomplished Application Form No. 401;

b. Photocopy of previously issued PTO;

c. Photocopy of Business/Mayor's Permit from the city/municipality where the establishment is located for the current year; and

d. Duplicate copy of official receipt of payment of application fee.

SECTION 7. Requirements for Product Listing. —

a. List and technical specifications of product lines as per Form 402 which shall be submitted during the initial application and be updated, where appropriate;

b. Additional requirements for importers:

• Certificate of Free Sale/Registration or equivalent documentary requirement indicating the country of manufacture; and

• Certificate of Distributorship/Distributorship Agreement

SECTION 8. Facilities and Equipment Requirements. —

All applicants are required to submit a complete list of their facilities and equipment as pre-requisite to the registration and issuance of PTO.

ARTICLE IV

Application Process

SECTION 9. Filing of Application. —

All new applications for registration and PTO will be accepted any time of the year. All applications for registration shall be accomplished in forms provided by DA-BAFE or DA-RAED. Application forms can be secured from BAFE, DA-RAED or can be downloaded in the BAFE or DA-RFO website.

Applicants located in the regions shall submit their application to their respective DA-RAED while applicants located in NCR shall submit their application directly to DA-BAFE.

Only application with the complete set of required documents under Sections 5, 6 and 7 shall be considered for review and processing. Application with incomplete set of requirements shall not be accepted. The applicant, however, may re-apply for the issuance of PTO after the required set of documents have been complied with.

SECTION 10. Review and Evaluation Process. —

The DA-BAFE shall check the completeness of the documents submitted in NCR. The DA-RAED, on the other hand, shall conduct initial review on the completeness of the application and documentary requirements submitted to their respective offices and shall only endorse the complete applications to DA-BAFE.

The DA-BAFE shall review the veracity and authenticity of the documents submitted based on the Checklist of Requirements.

SECTION 11. Period of Processing. —

 

	No. of Working Days
For new applications	20

• Receipt and initial evaluation of submitted documents

• Conduct of on-site inspection and evaluation

• Preparation of Inspection and Evaluation Report

• Final review by the SRED-Chief

• Approval of PTO by BAFE Director

• Release of approved PTO

For applications for renewal

15

• Receipt and initial evaluation of submitted documents

• Conduct of on-site inspection and evaluation

• Preparation of Inspection and Evaluation Report

• Final review by the SRED-Chief

• Approval of PTO renewal by BAFE Director

• Release of approved PTO

 

The processing of application will only commence upon the submission of complete documents to DA-BAFE for NCR applicants and to DA-RAED for applicants in the regions.

The Period of processing of applications shall not include the transmittal of documents using couriers.

SECTION 12. On-Site Inspection and Evaluation. —

The on-site inspection and evaluation shall be conducted by DA-BAFE/DA-RAED in the establishment prior to the issuance of PTO or its renewal.

The result of on-site inspection and evaluation shall form part of the documentary requirements prior to the final review of the application and issuance of PTO.

SECTION 13. Approval/Denial of Application. —

Upon evaluation of the application, the SRED through its Division Chief shall recommend the approval/denial of the issuance of PTO to the BAFE Director.

The decision of the Director approving or denying the application shall be final.

In case of denial of application, the DA-BAFE shall notify the applicant in writing stating the grounds of denial. Accordingly, the applicant may file for a new application upon receipt of notification.

The cross-functional flow chart for the application procedures (new/renewal) for the registration and issuance of PTO is shown in Annex A.

SECTION 14. Monitoring. —

After the grant of PTO, the establishment shall be subjected to monitoring any time of the year to ensure their continued compliance with the terms and conditions of the PTO. The monitoring shall be conducted by DA-BAFE/DA-RAED, with or without prior notice.

ARTICLE VPermit to Operate

SECTION 15. Issuance of Permit to Operate. —

Upon evaluation, verification, inspection and approval of the application and payment of the corresponding fee, a Permit to Operate (PTO) shall be issued by the BAFE Director.

The PTO shall include the following information:

a. Name of PTO holder and Location of establishment;

b. Classification of establishment;

c. BAFE Registration number;

d. Validity of the PTO;

e. Name and signature of the BAFE Director

In case the PTO is lost or destroyed, the applicant may request for a certified true copy to DA-BAFE upon payment of the prescribed fee.

If and when at any time of the year the business operations of the establishment ceases, the registration fee paid shall not be refunded.

In considering the application for renewal, the DA-BAFE/DA-RAED shall ascertain the continued compliance of the establishment with the rules and regulations stipulated in this Circular.

SECTION 16. Issuance of Provisional PTO. —

The DA-BAFE shall issue a provisional PTO, in cases of delay or non-performance of DA-BAFE or DA-RAED of their duties and responsibilities under this Circular arising from any cause or causes beyond their reasonable control, including, without limitation, any of the following: a) Government Acts; b) Acts of God (including, but not limited to, fire, explosions, flood and natural calamities); c) War, hostilities (whether war be declared or not), invasion, act of foreign enemies, mobilization, requisition, or embargo; d) Civil commotion, riot, strikes, and disorder; or e) Acts/threats of terrorism, provided that the application has passed the initial evaluation.

SECTION 17. Validity Period of PTO and Provisional PTO. —

The PTO shall be valid for five (5) years. Similarly, the provisional PTO shall be valid for three (3) months.

SECTION 18. Terms and Conditions of the PTO. —

The PTO holder shall be responsible in the utilization of the PTO. Specifically, it shall observe the following:

a. The PTO shall be placed conspicuously within the business premises;

b. The PTO is not transferrable and shall be solely used in which the application was sought; and

c. Updated copies of registration documentary requirements shall be readily made available, where appropriate.

ARTICLE VI

Registry of MFADDIE and Schedule of Fees and Charges

SECTION 19. Registry of MFADDIE and their Products. —

The DA-BAFE shall keep a national registry of MFADDIEs and complete list of all agricultural and fisheries machinery products reported. Likewise, the regional registry of MFADDIEs shall be kept by the respective DA-RAED.

The registry shall be for purpose of information generation and monitoring only.

SECTION 20. Fees and Charges. —

Collection of all fees and charges shall be paid at the DA-BAFE/DA-RFO cashier. Fees and charges may be subjected to changes, as deemed necessary. The fees and charges collected are non-refundable and subject to the usual government accounting and auditing rules and regulations.

The following fees and charges shall be collected:

Application Fee

Issuance Fee

Change of Circumstance

Certified True Copy of PTO

A separate guidelines relative to the issuance of PTO detailing the schedule of fees and charges will be issued by DA-BAFE.

ARTICLE VII

Amendments to the Registration and Cancellation of PTO

SECTION 21. Amendments to Registration. —

21.1 In case of any change in the circumstances described in the application such as change of name of the PTO Holder, change of location/address, change of ownership, etc., proper notification through writing shall be sent to the BAFE Director within ten (10) working days after effecting the changes.

21.2 The following requirements shall be submitted together with the duly accomplished application form (Form 401).

 

Amendment	Letter Request	PTO (original copy)	Mayor's/Business Permit	Deed of Sale or Donation
• Change in Business Name	Yes	Yes	Yes	No
• Change in Location/Address
— Within the Region	Yes	Yes	Yes	No
— To another Region	Yes	Yes	Yes	No
• Change in Ownership	Yes	No	Yes	Yes
• Product Lines	Yes	No	No	No

 

SECTION 22. Cancellation of PTO. —

22.1 Automatic

PTO Holders that fail to file an application for renewal after sixty (60) days from the date of expiration shall result to an automatic cancellation of the PTO without prejudice to their application.

22.2 Voluntary

The PTO holder may apply for voluntary cancellation of its existing PTO by filing a formal notification with the DA-BAFE or DA-RAED.

The cancellation of PTO by DA-BAFE shall be done through a Notice of Cease of Operation. No person or entity shall engage in any or all lines of activity stated in this Circular with cancelled PTO. The DA-BAFE shall require a new application for existing establishments with cancelled PTO.

ARTICLE VIII

Prohibited Acts and Its Sanctions

SECTION 23. Prohibited Acts. —

The DA-BAFE shall impose penalties after due notice and hearing to any of the following prohibited actions:

a. Commission of fraud and misrepresentation in the filing of the application and its operations;

b. Failure to comply with the terms and conditions provided in this Circular;

c. Giving permission of the use of PTO to non-holder of the permit;

d. Manufacture, fabricate, distribute, sell, offer for sale of any agricultural and fisheries machinery with invalid, expired, withdrawn, suspended or cancelled PTO;

e. Refusal to give access to required documents to DA-BAFE/DA-RAED during the monitoring of the establishment's premises; and

f. Commit any misconduct in the manufacturing, fabrication, assembly, distribution, dealing, importation and exportation of agricultural and fisheries machinery.

SECTION 24. Closure Proceedings. —

The DA Secretary or his duly representative has the power to file before the proper court or BAFE the closure proceedings against business entities not duly registered as manufacturers, assemblers, dealers or importers of agricultural and fisheries machinery.

SECTION 25. Administrative Sanctions. —

The BAFE shall, at its discretion, impose administrative sanctions for any covered person or entity for the violation of the provisions of this Circular. It may include penalties, such as fine, warning, and other administrative sanctions as necessary. The detailed procedures shall be governed by the Rules on the Imposition of Administrative Penalties and Sanctions for BAFE Regulatory Services.

ARTICLE IX

Final Provisions

SECTION 26. Separability Clause. —

Should any provision of this Department Circular or any thereof be declared invalid, the other provisions, so far as they are separable, shall remain in force and effect.

SECTION 27. Repealing Clause. —

All existing Circulars, rules and regulations, or parts thereof, inconsistent or in conflict with any provisions of this Regulation are hereby repealed or modified accordingly.

SECTION 28. Effectivity. —

This Circular shall take effect upon approval of the DA Secretary and fifteen (15) days from its publication in a newspaper of general circulation, its filing with the UP Law Center, and once BAFE issued a Memorandum Circular on its full institutionalization.

Approved and promulgated this 17th day of June 2019.

(SGD.) EMMANUEL F. PIÑOLDepartment of AgricultureSecretary

Published in the Philippine Daily Inquirer on July 29, 2019.