The House of Representatives has approved on third and final reading the proposed Revised Warehouse Receipts Law of the Philippines that provides for a simple way by which farmers and agricultural entities can obtain credit by storing their goods in a warehouse and trading the warehouse receipt.
With 196 affirmative and zero negative votes, House Bill 8698 was passed by the chamber on Tuesday, March 9. Once enacted into law, the bill will promote economic activity by increasing access credit via simplified, unified and modern warehouse receipts framework.
Principal author Camiguin Rep. Xavier Jesus D. Romualdo said the bill will repeal the over a century old Warehouse Receipts Law of 1912, otherwise known as “Act 2137”.
“It is high time that we update and improve Act 2137 so it can be attuned to the needs of our agricultural sector, We need to take advantage of modern technological advances that could be used to establish a system that is more secure, reliable and promotes ease of doing business,” Romualdo explained.
The salient provision of the bill is the establishment of a central electronic registry for all warehouse receipts, to be made readily available online, and later be integrated with other existing registries.
“Thus, a party can simply deposit his goods and products in a warehouse - assured that his goods shall be taken care of- in exchange for an electronic warehouse receipt which he or she can easily trade, barter or sell in order to obtain the necessary credit,” said Romualdo.
According to him the bill will enable the “agricultural sector to convert goods and products into credit in a faster and simpler way.” The bill was strongly endorsed for enactment by the Committee on Trade and Industry chaired by Navotas City Rep. John Reynald Tiangco.
The bill also penalizes the issuance of receipt for goods not received, issuance of receipts containing false statement, creation of fraudulent duplicate and delivery of goods without obtaining negotiated receipt, among others.
A warehouse operator or its agent who is found guilty of committing such violations face a prison term of at least ten years and/or a fine equal to triple the value of goods involved.
Under the bill, warehouse operators shall be accredited by the Securities and Exchange Commission before they can engaged in business.