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Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:u

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 ± This Act shall be known as the è
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 èR

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    ± The State recognizes the vital role of the youth in nation-building and shall promote and
protect their physical, moral, spiritual, intellectual and social well-being by enhancing their over-all development, taking into
account sectoral needs and conditions in the development of educational, cultural, recreational policies and programs addressed
to them.

Likewise, the State recognizes the importance and impact of broadcast media, particularly television programs on the value
formation and intellectual development of children and must take steps to support and protect children's interests by providing
television programs that reflect their needs, concerns and interests without exploiting them.

The State recognizes broadcasting as a form of mass communication guaranteed by the Constitution, the exercise of which is
impressed with public interest, and which imposes upon the broadcast industry the social responsibility of ensuring that its
activities serve the interest and welfare of the Filipino people.

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 ± For purposes of this Act, the following terms shall meanu

a) Children ± all persons below eighteen (18) years old;

b) Children's television ± refers to programs and other materials broadcast on television that are specifically designed for viewing
by children;

c) Child-friendly programs ± refer to programs not specifically designed for viewing by children but which serve to further the
positive development of children and contain no elements that may result in physical, mental and emotional harm to them.
These include various formats and genre that appeal to children and are made available for all ages from early childhood to
adolescence; and

d) Child-viewing hours ± hours which are considered to be appropriate for children to watch television taking into account other
activities which are necessary or desirable for their balanced development.

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  ± There is hereby established a National Council
for Children's Television (NCCT), hereinafter referred to as the Council, which shall be attached to the Office of the President for
purposes of administrative supervision.

The Council shall be composed of five (5) members who shall be appointed by the President for a term of three (3)
yearsu Provided, That of the first appointeesu

a) the term of the first set of two (2) members shall be for three (3) years;

b) the term of the second set of two (2) members shall be for two (2) years; and

c) the term of the remaining member shall be for one (1) year.

The members of the Council shall elect a chairperson from among themselves.

Members of the Council shall be appointed on the basis of their integrity, high degree of professionalism and having
distinguished themselves as an authority in the promotion of children's rights to responsible television programming and shall
represent the following sectors, namelyu academe, broadcast media, child development specialists, parents and child-focused
non-government organizations duly registered with the Securities and Exchange Commission (SEC) and with membership
preferably in all the cities and provinces throughout the country. The nominees shall be nominated by their respective
organization and the Council for the Welfare of Children in consultation with the Advisory Committee.
The members of the Council shall serve and continue to hold office until their successors shall have been appointed and
qualified. Should a member of the Council fail to complete his/her term, the successor shall be appointed by the President, but
only for the unexpired portion of the term.

The ranks, emoluments and allowances of the members of the Council shall be in accordance with the Salary Standardization
Law and other applicable laws.

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 ± The Council shall organize a secretariat to be headed by an Executive Director and with
not more than twenty (20) personnel, as may be determined by the Council. The Council shall determine the secretariat's
staffing pattern, determine the qualifications, duties, responsibilities and functions, as well as compensation for the positions to
be created by the Council upon recommendation of the Executive Director subject to the National Compensation and
Classification Plan and other existing Civil Service rules and regulations.

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 ± There is hereby constituted an Advisory Committee which shall
assist the Council in the formulation of national policies pertaining to children's broadcast programs and in monitoring its
implementation. The Council and the Advisory Committee shall meet at least once every quarter of a year.

The members of the Advisory Committee shall be composed of the followingu

a) the Executive Director of the Council for the Welfare of Children;

b) the Chairman or Executive Director of the National Commission for Culture and the Arts;

c) the President of the Kapisanan ng mga Brodkaster sa Pilipinas;

d) the President or Executive Director of the Philippine Association of National Advertisers;

e) Press Undersecretary/Officer-In-Charge of the Philippine Information Agency;

f) the Chairman of the Movie and Television Review and Classification Board; and

g) a representative from the National Telecommunications Commission.

Whenever any member of the Advisory Committee is unable to attend, he or she shall designate a representative to attend as
his or her alternate.

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   ± The Council shall have the following functionsu

a) to formulate and recommend plans, policies and priorities for government and private sector (iRe. broadcasters, producers,
advertisers) action towards the development of high quality locally-produced children's television programming, to meet the
developmental and informational needs of children;

b) to promote and encourage the production and broadcasting of developmentally- appropriate television programs for children
through the administration of a national endowment fund for children's television and other necessary mechanisms;

c) to monitor, review and classify children's television programs and advertisements aired during the hours known to be child-
viewing hours in order to take appropriate action such as disseminating information to the public and bringing monitoring results
to the attention of concerned agencies for appropriate action;

d) to formulate, together with the television broadcast industry, a set of standards for television programs shown during child-
viewing hours and work closely with the industry for the adoption and implementation of said standards;

e) to initiate the conduct of research for policy formulation and program development and disseminate its results to
broadcasters, advertisers, parents and educators on issues related to television and Filipino children;

f) to promote media education within the formal school system and other non-formal means in cooperation with private
organizations;

g) to monitor the implementation of this Act and other existing government policies and regulations pertaining to children's
broadcast programs, as well as to recommend and require the appropriate government agencies and/or self-regulatory bodies
concerned to enforce the appropriate sanctions for violations of these regulations and policies based on their respective
mandates;

h) to recommend to Congress appropriate legislative measures which will grant incentives for independent producers and
broadcasters to encourage the production of quality local children's television programs; and
i) to act on complaints committed in violation of this Act with the goal of protecting children from the negative and harmful
influences and to cause or initiate the prosecution of violators of this Act.

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 ± Within one (1) year from the effectivity of this Act,
the Council in consultation with the Advisory Committee shall submit to Congress a comprehensive development and protection
program with the end in view of formulating policies on children's media programs, and recommending plans and priorities for
government towards the promotion, development, production and broadcasting of developmentally -appropriate media programs
for children. Likewise, it shall prescribe an appropriate set of criteria for evaluating programs with the end in view of establishing
a Television Violence Rating Code.

Towards this end, the Council may consider internationally-accepted programs of action for children's television. More
particularly, the Council shall be guided by the following standards herein to be known as è he Charter of Children's elevisionèu

a) Children should have programs of high quality which are made specifically for them, and which do not exploit them. These
programs, in addition to being entertaining should allow children to develop physically, mentally and socially to their fullest
potential;

b) Children should hear, see and express themselves, their culture, languages and life experiences through television programs
which affirm their sense of self, community and place;

c) Children's programs should promote an awareness and appreciation of other cultures in parallel with the child's own cultural
background;

d) Children's program should be wide-ranging in genre and content, but should not include gratuitous scenes of violence and
sex;

e) Children's program should be aired in regular time slots when children are available to view and/or distributed through widely
accessible media or technologies;

f) Sufficient funds must be made available to make these programs conform to the highest possible standards; and

g) Government, production, distribution and funding organizations should recognize both the importance and vulnerability of
indigenous children's television and the steps to support and protect it.

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  ± A minimum of fifteen percent (15%) of the daily total
air time of each broadcasting network shall be allotted for child-friendly shows within the regular programming of all networks
granted franchises or as a condition for renewal of broadcast licenses hereinafter, to be included as part of the network's
responsibility of serving the public.

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 ± The Council, in consultation with all appropriate government agencies and
non-government organizations, shall issue the necessary rules and regulations for the implementation of this Act within ninety
(90) days after its effectivity.

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 ± In the exercise of its administrative function, the Council shall petition the proper government agencies
and/or appropriate self-regulatory bodies to suspend, revoke or cancel the license to operate television stations found violating
any provision of this Act and its implementing rules and regulations.

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  ± The creation of a National Endowment Fund for
Children's Television, hereinafter referred to as the Fund, is created for the promotion of high standards of indigenous program
development in children's television and media specifically intended for Filipino children. An amount of Thirty million pesos
(P30,000,000) sourced from the income of the lotto operations of the Philippine Charity Sweepstakes Office (PCSO) and
another Thirty million pesos (P30,000,000) from the gross income of the Philippine Gaming Corporation (PAGCOR) shall form
part of the Fund.

a) The Fund shall be created for the purpose of developing and producing high quality television programs that are culturally-
relevant and developmentally- appropriate for children.

b) The Fund is intended to contribute to the development of media programs that contribute to Filipino children's awareness and
appreciation for their cultural identity, national heritage and social issues that will in turn help them grow to be productive and
nationalistic citizens.

c) Access to the Fund shall be provided by the Council through a grant application process for qualified producers and
organizations with proven track record in the production of high quality children's television programs. Necessary requirements
are to be submitted to the Council for approval.

d) Copyright for programs and products to be developed with assistance from the Fund will be jointly owned by the Council and
the producers.
e) Priority shall be given to independent producers and organizations or institutions including youth organizations who do not
have access to the resources of a national network.

f) The Council is authorized to accept grants, contributions or donations from private corporations and international donors for
the National Endowment Fund for Children's Televisionu Provided, That such grants, contributions, or donations are exempted
from donor's and donee's taxesu Provided, further, That these funds will be used strictly for the endowment fund.

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 ± For the initial operating expenses of the Council, the amount of Five million pesos (P5,000,000)
is hereby appropriated out of the funds of the National Treasury not otherwise appropriated. Thereafter, it shall submit to the
Department of Budget and Management its proposed budget for inclusion in the General Appropriations Act, approved by
Congress.

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  ± If any provision of this Act is declared unconstitutional, the same shall not affect the validity
and effectivity of the other provisions thereof.

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thereof contrary to or inconsistent with the provisions of this Act are hereby repealed or modified accordingly.

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  ± This Act shall take effect fifteen (15) days after its publication in the Official Gazette or in at
least two (2) newspapers of general circulation.

Approvedu 
 

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WHEREAS, the State recognizes the vital role of communication and information in nation-building;

WHEREAS, the Filipino people must be given wider access to more sources of news, information, education, sports events and
entertainment programs other than those provided for by mass media and afforded television programs to attain a well informed,
well-versed and culturally refined citizenry and enhance their socio-economic growth;

WHEREAS, cable television (CATV) systems could support or supplement the services provided by television broadcast
facilities, local and overseas, as the national information highway to the countryside;

WHEREAS, because a large part of the country is still not covered by cable television services, there is an urgent need to
maximize the development of the cable television industry and to provide incentives and afford protection to investments therein;

WHEREAS, professionalism and self-regulation among existing operators, through a nationally recognized cable television
operators' association, have enhanced the growth of the cable television industry and must therefore be maintained along with
minimal reasonable government regulations;

NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines, by virtue of the powers vested in me by
law, do hereby adopt the following guidelines for the cable television (CATV) industryu

Section 1. The operation of cable television systems, as a subscriber service undertaking with a unique technology, shall be
maintained separate and distinct from telecommunications or broadcast television.

Section 2. The regulation and supervision of the cable television industry in the Philippines shall remain vested solely with the
National Telecommunications Commission (NTC).

Section 3. Only persons, associations, partnerships, corporations or cooperatives granted a Provisional Authority or Certificate
of Authority by the Commission may install, operate and maintain a cable television system or render cable television service
within a service area.

Cable television service may carry advertisements and other similar paid segments for which the cable television operator may
charge and collect reasonable fees; Provided, that no cable television operator shall infringe on broadcast television markets by
inserting advertisements in the programs it carries or retransmits without the consent of the program provider concerned.

Section 4. Local exchange operators and/or broadcasters, as well as operators of direct broadcast satellite service, multi-point
distribution service, television receive-only satellite program distribution service and other systems of providers of video
programming utilizing whatever technology, shall not operate cable television systems or any form of service involving the
delivery television programs and signals, by wire or cable or through the airwaves and other wireless video signal transmission
systems without specific permits, licenses and/or authority to operate a cable television system as provided hereunder and
under applicable laws and rules and regulations, which permits, licenses and/or authority shall be issued in accordance with the
provisions of this Executive Order.
Section 5. The Commission may grant an applicant an authority to operate a cable television system within the same franchise
area covered by any Provisional Authority or Certificate of Authority issued by the Commission two (2) years earlier only upon
the determination by the Commission that -

a) the prior cable television operator has not, without sufficient justification, substantially complied with the terms and condition
of his authorization;

b) the cable television service currently provided by the operator to its subscriber is grossly inadequate; and

c) the grant of the authority to the applicant will not result in ruinous competition detrimental to the existing operator and
incompatible with the investment policies under this Executive Order.

Section 6. A cable television operator may, with prior approval from the Commission, lease or sub-lease any excess capacity of
its cable television system to a third party.

Section 7. Receipt and distribution encoded satellite program signals shall be limited to the written authority granted by the
satellite programmer.

Section 8. The Commission is hereby directed to ensure the proper implementation of this Executive Order, adopt rules and
regulations for the purpose and, after due notice and hearing, impose the appropriate penalties in case of violation of any of the
provisions hereof and the applicable rules and regulations, including administrative fines, penalties and sanctions as may be
allowed or prescribed by existing laws.

Section 9. All executive orders, administrative orders and other issuances inconsistent herewith are hereby repealed, modified
or amended accordingly.

Section 10. This Executive Order shall take effect immediately upon approval hereof.

DONE in the City of Manila, this 9th day of September, in the year of Our Lord, Nineteen Hundred and Ninety-Seven.

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Manila

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WHEREAS, the mass media have been used for the conspiracy against the Government and have taken part in that conspiracy
either by direct willful participation, or by indirectly giving aid and comfort to the forces of insurgency and subversion seeking to
overthrow the Government by organized violenceu

WHEREAS, some franchises, permits and authorizations granted for the operation of radio, television and telecommunication
facilities have remained unused or unavailed of by their proper holders after a reasonable length of time from the time such
franchises, permits and authorizations have been issued; that some of them have been leased to parties not otherwise
authorized to operate such facilities; and some of them, in the actual operation of these facilities, have violated or refused to
comply with regulations of the Radio Control Board, or any other government authority having supervision over their operation;

WHEREAS, in order to safeguard the security of the state and promote the objectives and goals of sound government, it is
necessary that judicious care be exercised in deciding what mass media facilities should be authorized to operateu

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the
Constitution as Commander in Chief of all the Armed Forces of the Philippines, and pursuant to Proclamation No. 1081, dated
September 21, 1972, and general Order No. 1. dated September 22, 1972, do hereby decree and orderu

1. The cancellation of all franchises, permits and authorizations of all mass media facilities that have consciously or
unconsciously taken part in the conspiracy against the Government, given aid and comfort to the forces of insurgency and
subversion and have either directly supported, or aided and abetted the subversion of our established traditions and value;

2. The cancellation of all franchises, permits and authorizations granted for the operation of radio, television and
telecommunication facilities; (a) if such franchises, permits and authorizations have not been availed of or used by parties or
parties on whose name they were issued, (b) if they have been given over for lease or use by parties not otherwise authorized to
hold such franchises, permits and authorizations, or (c) if in their operation they have violated or failed to comply with the
regulations of the Radio Control Board or any other government entity authorized to see the operation thereof.
3. The creation of a Mass Media Council, headed by the Secretary of Public Information as chairman, with the Secretary of
National Defense as co-chairman, and one representative from the mass media to be appointed by the President as member,
and with a secretariat to be headed by the Chairman of the Radio Control Board, with the duty of passing upon applications of
mass media for permission to operate, so that no newspaper, magazine, periodical or publication of any kind, radio, television or
telecommunications facility, station or network may so operate without obtaining from the Mass Media Council a certificate of
authority shall be duly signed by the President, and shall be in force for six months, renewable for other six months thereafter,
unless otherwise terminated earlier.

4. All mass media facilities shall guarantee space and time for information emanating from the Government, and shall allot, as
the Secretary of Public Information may direct, adequate space and time for all national undertakings, projects and campaigns
that require wide, public dissemination, and shall treat information pertaining thereto as public service material whether this be in
the form of news matter, pictures, features, or the like, or in any promotional form. All radio and television stations and networks
shall, under the guidance of the Department of Public Information, carry simultaneous regular broadcasts on agricultural
production, consumers' prices index, general government and such other subjects of vital concern to the public. The print media
shall carry the equivalent of these broadcasts.ëawphil@alf

This decree is hereby made part of the laws of the land. It shall take effect immediately and shall remain in force for the duration
of the present national emergency, or unless otherwise ordered by me or by my duly designated representative.

Done in the City of manila, this 2nd day of November, in the year of Our Lord, nineteen hundred and seventy-two.

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Manila

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WHEREAS, the proliferation and unregulated circulation of videograms including, among others, videotapes, discs, cassettes or
any technical improvement or variation thereof, have greatly prejudiced the operations of movie houses and theaters, and have
caused a sharp decline in theatrical attendance by at least forty percent (40%) and a tremendous drop in the collection of sales,
contractor's specific, amusement and other taxes, thereby resulting in substantial losses estimated at P450 Million annually in
government revenues;

WHEREAS, videograms establishments collectively earn around P600 Million per annum from rentals, sales, and disposition of
videograms, and such earnings have not been subjected to tax, thereby depriving the Government of approximately P180 Million
in taxes each year;

WHEREAS, the unregulated activities of videogram establishments have also affected the viability of the movie industry,
particularly the more than 1,200 movie houses and theaters throughout the country, and occasioned industry-wide displacement
and unemployment due to the shutdown of numerous movie houses and theaters;

WHEREAS, in order to ensure national economic recovery, it is imperative for the Government to create an environment
conducive to the growth and development of all business industries, including the movie industry which has an accumulated
investment of about P3 Billion;

WHEREAS, proper taxation of the activities of videogram establishments will not only alleviate the dire financial condition of the
movie industry upon which more than 75,000 families and 500,000 workers depend for their livelihood, but also provide an
additional source of revenue for the Government, and at the same time rationalize the heretofore uncontrolled distribution of
videograms;

WHEREAS, the rampant and unregulated showing of obscene videogram features constitutes a clear and present danger to the
moral and spiritual well-being of the youth, and impairs the mandate of the Constitution for the State to support the rearing of the
youth for civil efficiency and the development of moral character and promote their physical, intellectual, and social well-being;

WHEREAS, civic-minded citizens and groups have called for remedial measures to curb these blatant malpractices which have
flaunted our censorship and copyright laws;

WHEREAS, in the face of these grave emergencies corroding the moral values of the people and betraying the national
economic recovery program, bold emergency measures must be adopted with dispatch;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the
Constitution, do hereby decreeu

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  CreationR - There is hereby created an office to be known as the Videogram Regulatory Board, hereinafter referred to
as the BOARD, which shall have its principal office in Metro Manila and shall be under the Office of the President of the
Philippines. The BOARD shall regulate the importation, exportation, production, reproduction, distribution, exhibition, showing,
sale, lease or disposition of videograms including, among others, videotapes, discs, casettes or any technical improvement or
variation thereof in accordance with such rules and regulations to be adopted by the BOARD.

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  Composition of the BoardR - The Board shall be composed of a Chairman, a Vice-Chairman and eighteen (18)
members who shall all be appointed by the President of the Philippines to serve for a term of one (1) year, unless sooner
removed by the President for any cause; Provided, That they shall be eligible for reappointment after the expiration of their term.
If the Chairman or Vice-Chairman or any of the members fails to complete his term, any person appointed to fill the vacancy
shall serve only for the unexpired portion of the term of the Board member whom he succeeds.

No person shall be appointed to the BOARD, unless he is a natural-born citizen of the Philippines, not less than twenty-one
years of age, and of good moral character and standing in the community; Provided, That in the selection of the members of the
BOARD due consideration shall be given to such qualifications as would produce a multi-sectoral combination of expertise in the
various areas of the videogram industry; Provided, further, That at least five (5) members must be members of the Philippine
Bar.

The Chairman, Vice-Chairman and members of the BOARD shall be entitled to transportation, representation and other
allowances which shall in no case exceed Five Thousand Pesos (P5,000.00) per month.

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  Powers and FunctionsR - The BOARD shall have the following powers and functionsu

1) To supervise, regulate, grant, deny, or cancel permits for the importation, exportation, production, copying, sale, lease,
exhibition or showing of videograms including, among others, videotapes, discs, cassettes or any technical improvement or
variation thereof;

2) To approve or disapprove, delete, objectionable portions from and/or prohibit the importation, exportation, production,
copying, distribution, sale, lease, exhibition or showing of videograms, including, among others, videotapes, discs, cassettes or
any technical improvement or variation thereof, which, in the judgment of the BOARD applying contemporary Filipino cultural
values as basic standard, are objectionable for being immoral, indecent, libelous, contrary to law or good customs, or injurious to
the prestige of the Republic of the Philippines or its people, or with a dangerous tendency to encourage or fan hatred, the
commission of violence or of a wrong or crime, such as but not limited tou

i) Those which tend to incite subversion, insurrection, rebellion, or sedition against the State or otherwise threaten the economic
and/or political stability of the State;

ii) Those which tend to undermine the faith and confidence of the people in their government and/or the duly constituted
authorities;lawphilRnet

iii) Those which glorify criminals or condone crimes;

iv) Those which are libelous or defamatory to the good name and reputation of any person, whether living or dead;

v) Those which serve no other purpose but to satisfy the market for excessive violence or hard-core pornography;

vi) Those which tend to abet the traffic in and use of prohibited drugs; or

vii) Those which commit direct or indirect contempt of any court of justice or quasi-judicial tribunal whether any litigation on the
subject of the video is pending or not before such court of tribunal.

3) To classify all videograms into categories such as "For General Patronage", "For Adults Only", or such other categories as the
BOARD may determine for the public interest;

4) To close video theaters and other similar establishments engaged in the public exhibition or showing of videograms which
violate the provisions of this Decree and the rules and regulations promulgated by the BOARD pursuant thereto;

5) To levy, assess and collect, and periodically adjust and revise the rates of fees and charges for the work of review and
examination and for the issuance of licenses and permits which the BOARD is authorized to grant in the exercise of its powers
and functions and in the performance of its duties and responsibilities;lawphilRnet

6) To review and examine all videograms, including among others, videotapes, discs, cassettes or any technical improvement or
variation thereof, as well as publicity materials or advertisements related thereto, with the end in view of making appropriate
classification;

7) To deputize representatives from the government and from the various associations in the videogram industry, whose main
duties shall be to help and ensure compliance with all laws, rules and regulations relative to this Decree. For this purpose, the
BOARD may constitute such Council or Councils composed of representatives from the government and the videogram industry
as may be appropriate to implement the objectives of this Decree. The BOARD may also call upon any law enforcement agency
for assistance in the implementation and enforcement of its decisions, orders and rules and regulations;

8) To cause the prosecution, on behalf of the People of the Philippines, of violators of this Decree and the rules and regulations
promulgated or issued by the BOARD.

9) To promulgate such rules and regulations as are necessary or proper for the implementation of this Decree and the
accomplishment of its purposes and objectives. Such rules and regulations shall take effect after fifteen (15) days following their
publication in newspapers of general circulation in the Philippines;

10) To prescribe the internal and operational systems and procedures for the exercise of its powers and functions including the
creation and vesting of authority upon sub-committees of the BOARD for the work of review, examination or classification and
other related matters; and

11) To exercise such other powers and functions as may be necessary or incidental to the attainment of the purposes and
objectives of this Decree, and to perform such other related duties and responsibilities as may be directed by the President of
the Philippines.

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 ( ï ecutive OfficerR - The Chairman of the BOARD shall be the Chief Executive Officer. He shall Exercise the following
duties and functionsu

a) Execute, implement and enforce the decisions, orders, rules and regulations promulgated or issued by the BOARD;

b) Direct and supervise the operations and the internal affairs of the BOARD;

c) Establish the internal organization and administrative procedures of the BOARD, and recommend to the BOARD the
appointment of the necessary administrative and subordinate personnel; and

d) Exercise such other powers and functions and perform such duties as are not specifically lodged in the BOARD.

The Chief Executive Officer shall be assisted by an Executive Director who shall be appointed by the President of the
Philippines. The Executive Director shall hold office for a term of one (1) year, unless sooner removed by the President of the
Philippines, for any cause.

Unless otherwise provided by law, the Chief Executive Officer shall receive an annual salary of Seventy Two Thousand Pesos
(P72,000.00) and the Executive Director shall receive an annual salary of Sixty Thousand Pesos (P60,000.00).

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 * RegistrationR - No person, whether natural or juridical, may engage in the importation, exportation, production,
reproduction, exhibition, showing, sale, lease or disposition of videograms unless such person is first registered with and
permitted by the BOARD to operate as such. The registration with and permit issued by the BOARD is a condition precedent for
securing a business permit or license from the appropriate authorities.

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  Reproduction of Cinematographic ArtR - No person registered and permitted to engage in the videogram industry can
copy or reproduce any cinematographic art without the written consent or approval of the producer, importer or licensee of the
cinematographic art to be copied or reproduced, and in no case shall any cinematographic art be allowed to be copied or
reproduced within a period of six (6) months after it is first released for theatrical exhibition, unless the producer, importer or
licensee agrees to a shorter period.

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  Sale, Lease or Disposition of VideogramsR - No videogram including, among others, videotapes, discs, cassettes or
any technical improvement or variation thereof, shall be sold, leased or otherwise disposed of unless first registered with the
BOARD with the corresponding registration identification or seal in such form and manner as may be provided for by the
BOARD.

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  PenaltyR - Any person who violates any or all of the provisions of Sections 3, 6, 7, 8 and 10 of this Decree or the rules
and regulations to be promulgated pursuant thereto, either as principal, accomplice or accessory, shall, upon conviction, suffer a
mandatory penalty of three (3) months and one (1) day to one (1) year imprisonment plus a fine of not less than Fifty Thousand
Pesos (P50,000.00) but not more than One Hundred Thousand Pesos (P100,000.00). Should the offense be committed by a
juridical person, the chairman, the president, secretary, treasurer, or the partner responsible therefor, shall be the persons
penalized.

The provisions of Presidential Decree No. 968, as amended (Probation Law), shall not apply in cases of violations of this
Decree, including its implementing rules and regulations.

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  a on Sale, Lease or Disposition of VideogramsR - Notwithstanding any provision of law to the contrary, the
province shall collect a tax of thirty percent (30%) of the purchase price or rental rate, as the case may be, for every sale, lease
or disposition of a videogram containing a reproduction of any motion picture or audiovisual program. Fifty percent (50%) of the
proceeds of the tax collected shall accrue to the province, and the other fifty percent (50%) shall accrue to the municipality
where the tax is collected; Provided, That in Metropolitan Manila, the tax shall equally by the city/municipality and the
Metropolitan Manila Commission.

The tax herein imposed shall be due and payable within the first twenty (20) days of the month next following that for which it is
due, by the proprietor, seller or lessor concerned, and such tax shall be determined on the basis of a true and complete return of
the amount of gross receipts derived during the preceding month. If the tax is not paid within the time fixed herein above, the
taxpayer shall be subject to such surcharges, interests and penalties prescribed by the Local Tax Code. In case ofwillfull neglect
to file the return and pay the tax within the time required, or in case a fraudulent return is filed or a false return is willfully made,
the taxpayer shall be subject to a surcharge of fifty percent (50%) of the correct amount of the tax due in addition to the interest
and penalties provided by the Local Tax Code.

Any provision of law to the contrary notwithstanding, a city may also levy and collect, among others, any of the taxes, fees and
other impositions that the province or the municipality may levy and collect.

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  Assistance in the ïnforcement Functions of the BOARDR - The BOARD may solicit the direct assistance of other
agencies and units of the government, and deputize, for a fixed and limited period, the heads or personnel of such agencies and
units to perform enforcement function for the BOARD. The government agencies and units exercising the enforcement functions
for the BOARD shall, insofar as such functions are concerned, be subject to the direction and control of the BOARD.

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  Organizational Pattern; PersonnelR - The BOARD shall determine its organizational structure and its staffing pattern.
It shall have the power to suspend or dismiss for cause any employee and/or approve or disapprove the appointment, transfer or
detail of employees. It shall appoint the Secretary of the BOARD who shall be the official custodian of the records of the
meetings of the BOARD and who shall perform such other duties and functions as directed by the BOARD.

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  Applicability of Civil Service LawR - The BOARD and its officers and employees shall be subject to the Civil Service
Law, rules and regulations; Provided, That technical personnel shall be selected on the basis of merit and fitness to be
determined in accordance with such policies and guidelines as may be approved by the BOARD.

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 ( AuditorR - The Chairman of the Commission on Audit shall be the ex officio Auditor of the BOARD. For this purpose,
he may appoint a representative who shall be the auditor of the BOARD, together with the necessary personnel to assist said
representative in the performance of his duties. The number and salaries of the auditor and said personnel shall be determined
by the Chairman of the Commission on Audit, subject to the rules and regulations of the Commission on Audit. Said salaries and
all other expenses of maintaining the auditor's office shall be paid by the BOARD.

The Auditor shall, as soon as practicable, but not later than three (3) months after the accounts have been submitted to audit,
send an annual report to the BOARD. The Auditor shall also submit such periodic or special reports as the BOARD may deem
necessary or proper.

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 ) ransitory ProvisionR - All videogram establishments in the Philippines are hereby given a period of forty-five (45)
days after the effectivity of this Decree within which to register with and secure a permit form the BOARD to engage in the
videogram business and to register with the BOARD all their inventories of videograms, including videotapes, discs, cassettes or
other technical improvements or variations thereof, before they could be sold, leased, or otherwise disposed of. Thereafter any
videogram found in the possession of any person engaged in the videogram business without the required proof of registration
by the BOARD, shall be prima facie evidence of violation of this Decree, whether the possession of such videogram be for
private showing and/or for public exhibition.

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 * AppropriationsR - The sum of Three Million Pesos out of any available funds from the National Treasury is hereby
appropriated and authorized to be released for the organization of the BOARD and its initial operations. Henceforth, funds
sufficient to fully carry out the functions and objectives of the BOARD shall be appropriated every fiscal year in the General
Appropriations Act.

All fees, revenues and receipts of the BOARD from any and all sources shall be used to augment the funds to support the
expenditures needed by the BOARD in the pursuit of its purposes and objectives and the exercise of its powers and functions,
and for such other purposes as may hereafter be directed by the President of the Philippines.

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  Annual ReportsR - The BOARD shall, within three months after the end of every fiscal year, submit its annual report
to the President. The annual report shall include, among others, a statement of the BOARD's accomplishments together with its
plans and recommendations to improve and develop its operations and the supervision and regulation of the videogram industry.

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  Separability ClauseR - In case any provision of this Decree shall be held or declared invalid or unconstitutional, the
validity of the other provisions shall not be affected thereby.

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  Repealing ClauseR - Any provision of law, decree, executive order, letter of instructions or implementation, or other
rules and regulations inconsistent with the provisions of this Decree is hereby repealed, amended or modified accordingly.

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  ïffectivityR - This Decree shall take effect after fifteen (15) days following its publication in the Official Gazette.
DONE in the City of Manila, this 5th day of October, in the year of Our Lord, nineteen hundred and eighty-five.

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WHEREAS, in the last five years, the Philippines has attracted the investments of the major multinational semiconductor
manufacturers;

WHEREAS, the present Philippine semiconductor electronics industry already accounts for some 20% of the world's merchant
semiconductor assembly production (measured in units);

WHEREAS, the semiconductor electronics industry is a high technology industry which is characterized by rapid technological
changes that require continuous new capital investments and higher manpower skills and productivity;

WHEREAS, new technological inventions, such as the higher technology, higher priced large scale-and very large scale-
integrated circuits will soon be the major products for semiconductor assembly;

WHEREAS, the forthcoming semiconductor assembly will require more intensive capital process and production equipment, and
less of the historical labor content;

WHEREAS, the Philippines has sufficient educated; trainable manpower resources for the production operations, technical and
management needs of the semiconductor electronics industry;

WHEREAS, to increase its value, the semiconductor process technology in the Philippines should be raised to higher levels, and
operations be integrated forward into testing, and when conditions are favorable, backward into wafer fabrication;

WHEREAS, it is to the national interest that the Philippines is viewed by investors as an attractive, cost competitive environment
in the face of changing needs of the semiconductor electronics industry;

WHEREAS, Article 57 of Presidential Decree No. 1789, otherwise known as the Omnibus Investments Code, empowers the
President to grant new or additional incentives or modify existing ones in the interest of national development;

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 the authority vested in me by the Presidential Decree No. 1789, do hereby order and ordainu

Sec. 1. Policy Statement and Objectives. It is hereby declared to be the policy of the State to maintain an investment
environment conducive to the growth and development of the semiconductor electronics industry. Such investment environment
shallu

(a) Provide operational maximum flexibility;

(b) Be cost competitive;

(c) Provide an adequate supply of required skills in the manpower pool;

(d) Provide training to ensure a future supply of highly skilled engineers and technicians;

(e) Create the infrastructure of suppliers needed by the industry for the supply of services, materials and supplies;

(f) Encourage investors to evolve higher levels of assembly processes, automation, forward integration into device testing, and
backward integration into wafer fabrication;

(g) Encourage investors to develop a viable Consumer and Industrial Electronics Products Industry to serve both domestic and
export markets.

Sec. 2. Additional Incentives to the Semiconductor Industry. In addition to the incentives provided for firms in the semiconductor
electronics industry registered with the Board of Investments as export producers under Book I of P.D. 1789, otherwise known
as the Omnibus Investments Code or R.A. 6135, otherwise known as the Exports Incentives Act, such enterprise shall enjoy the
incentives enumerated hereunderu

(a) Exemption from taxes and duties on imported spare parts. Within seven years from the date of registration, importation of
required spare parts and supplies shall be exempt from tariff duties and compensating tax payable thereon, Provided, however,
that such spare parts and supplies are not locally available at reasonable price, sufficient quantity and comparable quality.
(b) Exemption from contractor's tax. Gross receipts of a registered firm in the semiconductor electronics industry shall be exempt
from the contractor's tax under the Internal Revenue Code.

(c) Exemption from tax on accumulated profits or surplus. Registered enterprises in the semiconductor electronics industry shall
be exempt from the tax on accumulated profits or surplus as provided for in Sec. 25 of the National Internal Revenue Code, as
amended.

(d) Deemed compliance with General Order 47. Registered enterprises in the semiconductor electronics industry are deemed to
have complied with General Order No. 47, requiring large companies to produce rice and corn for their employees, Provided,
however, that such company shall, in addition to the specific in-company training for its personnel, share in the financing of
industry-wide training of engineers and technicians for the semiconductor electronics industry to be organized by the Ministry of
Trade and Industry.

(e) Declaration as vital industry. Pursuant to Article 264(g) of the Labor Code (Batas Pambansa Blg. 130 as amended by Batas
Pambansa Blg. 227), the semiconductor electronics industry is hereby declared a vital industry and any labor dispute therein
causing or likely to cause strikes or lockouts will adversely affect the national interest. In the event of such labor dispute in the
industry, the Minister of Labor and Employment shall immediately assume jurisdiction over such dispute and decide it or certify
the same to the National Labor Relations Commission for compulsory arbitration. Such assumption or certification shall have the
effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or certification order.
If one has already taken place at the time of assumption or certification, all striking or locked out employees shall immediately
return to work and the employers shall immediately resume operations and readmit all workers under the same terms and
conditions prevailing before the strike or lockout.

(f) Exemption from locational clearance. Any provision of law to the contrary notwithstanding, the enterprise shall be exempt
from the locational clearance required by any government agency.

(g) Customs clearance. The clearance for the importation of equipment, spare parts, raw materials and supplies, and exports of
processed products shall be expedited by the Bureau of Customs for semiconductor companies certified by the Board of
Investments.

(h) Unrestricted use of consigned equipment. Provisions of existing laws notwithstanding machinery, equipment and spare parts
consigned to any registered firm engaged in the manufacture of semiconductor devices shall not be subject to restrictions as to
period of use of such machinery, equipment and spare parts provided that the appropriate re-export bond is posted.

Sec. 3. Incentives to enterprises registered with the Export Processing Zone. The Board of Investments may extend additional
incentives herein provided to firms registered with the Export Processing Zones without need of complying with the registration
requirements of the Board of Investments.

Sec. 4. Existing Firms. Existing firms embarking in higher technological processes such as automation or in forward and/or
backward integration, shall qualify to register such projects as an expansion entitled to the new registration with the Board of
Investments.

Sec. 5. Extension of Incentives. The Board may extend the period of availment of incentives by firms in the semiconductor
electronics industry if such is necessary to maintain the country's competitive position in attracting additional investments in the
industry, Provided, however, that such extension shall not be for more than twice the original period under the law.

Sec. 6. Assistance by the Government Agencies. The Central Bank, Ministry of Labor and Employment, Human Settlements
Regulation Commission, National Food Authority, Bureau of Customs, Bureau of Internal Revenue, Ministry of Finance,
Securities and Exchange Commission and other government offices concerned are directed to adopt respective rules and
regulations which are applicable to the semiconductor electronics industry to support the full and expeditious implementation of
the policy and objectives herein declared.

Sec. 7. Rules and Regulations. The Board of Investments is empowered to adopt rules and regulations for the implementation of
this Order.

Sec. 8. Repealing Clause. Any provision of law, decrees, or executive orders, instructions, rules, regulations or circulars
inconsistent with this Executive Order is hereby repealed or modified accordingly.

Sec. 9. Effectivity. This Executive Order shall take effect immediately.

Done in the City of Manila, this 26th day of June, in the year of Our Lord, nineteen hundred and eighty-two.