Primer of Barangay Micro Business Enterprise as prepared by Mr. Sinbad D. Bahena, Municipal Treasurer of LGU Kapalong to be used for information campaign.
This primer provides quick and essential information on Republic Act 9178, otherwise known as the “Barangay Micro Business Enterprises (BMBEs) Act of 2002”. It includes a directory of the key people who may be contacted for further information about this Act and its implementation.
The full text of RA 9178 and Department of Trade and Industry (DTI) Administrative Order No. 1, Series of 2003 are also provided for ready reference.
Q & A on
Republic Act No. 9178
Barangay Micro Business Enterprises (BMBE’s)
Act of 2002
1. What are barangay micro business /enterprises (BMBEs)?
A BMBE is defined as any business enterprise engaged in production, processing or manufacturing of products, including agro-processing, as well as trading and services, with total assets of not more than P3 million. Such assets shall include those arising from loans but not the land on which the plant and equipment are located.
2. What is the law all about?
In a nutshell, the BMBE Act of 2002 encourages the formation and growth of barangay micro business enterprises by granting them Incentives and other benefits.
The Act was signed into law by President Gloria Macapagal-Arroyo on November 13, 2002. It’s implementing Rules and Regulations (IRR) was issued on February 7, 2003 through DTI Department Administrative Order No. 01, series of 2003 and was published in the Manila Bulletin last February 11 and 26, 2003.
3. What is the objective of the law?
BMBEs are essential to the country’s economic development since they effectively serve as seedbeds of Filipino entrepreneurial talent. Thus, the Act aims to integrate BMBEs in the informal sector into the mainstream economy. Strengthening BMBEs would mean more jobs and livelihood, and a better quality of life for Filipinos.
4. What are the incentives that BMBE’s will be receiving?
The major incentives are (1) income tax exemption from income arising from operations of the enterprise; (2) exemption from the coverage of the Minimum Wage Law (BMBE employees will still receive the same social security and health care benefits as other employees; (3) priority to a special window set up specifically for the financing requirements of BMBEs; and (4) technology transfer, production and management training, marketing assistance programs for BMBE Beneficiaries.
5. What are the funding agencies designated to set up the special credit window for registered BMBEs?
The following government financial institutions will be providing a special credit window for BMBEs:
6. What are the agencies assigned to provide assistance in the area of technology transfer, production and management training, and marketing assistance?
The agencies concerned are the following:
Department of Trade and Industry (DTI)
Department of Science and Technology (DOST
University of the Philippines Institute for Small Scale Industries (UP-ISSI)
Cooperative Development Authority (CDA)
Technical Education and Skills Development Authority (TESDA)
Technology and Livelihood Resource Center (TLRC)
7. Who may avail of the special credit window for BMBEs?
Only registered BMBEs may take advantage of the credit facility and other benefits granted under the law. This means that the enterprise must have a Certificate of Authority which authorizes it to operate as BMBE.
8. How does one register?
Any person, cooperative, or association owning an enterprise that fits the description of a BMBE may register with the Office of the Treasurer of the city or municipality where the business is located.
9. Requirements:
a. Duly filled-up application form (BMBE Form 01) in triplicate, signed by the owner or manager of the entity for registration; and
b. Three passport size ID pictures
10. Procedures:
a. Accomplish BMBE Form 01 in triplicate and submit to the Office of the Municipal or City Treasurer.
b. The Municipal or City Treasurer evaluates the application. The application shall be processed within 15 working days upon submission; otherwise, the BMBE shall be deemed registered.
c. A registered BMBE shall be issued a Certificate of Authority as proof of registration, effective for the period of two (2) years. The application is renewable every two years.
11. How much will cost to register?
Registration and issuance of the Certificate of Authority of the local government unit (LGU) is free of charge and shall be done promptly. However, to defray the administrative and monitoring the BMBEs, the LGUs are allowed to charge a fee not exceeding P1,000.00.