MODULE 2. Regulations Governing the Fertilizer and Pesticide Industries

Transcription

1 MODULE 2 Regulations Governing the Fertilizer and Pesticide Industries Lesson 1. LICENSING OF DEALERS AND ITS LEGAL BASIS Legal Basis Pursuant to Section 9 of PD 1144, all fertilizer and pesticide handlers must obtain license with the Fertilizer and Pesticide Authority. "... No person shall engage in the business of exporting, importing, manufacturing, formulating, distributing, supplying, repacking, storing, commercially applying, selling, marketing of any fertilizer, pesticide and other agricultural chemicals except under a license issued by the FPA..." Definition of Terms Accreditation - authorization, in the form of an ID card, issued to an individual who attended the ASD training and passed the corresponding examination. Accredited Safety Dispenser of Fertilizer and Pesticide (ASD) - refers to an individual who attended the 2-day training conducted by FPA for such purpose, has passed the corresponding examinations and issued with accreditation card by FPA. Dealer - person(s) who sells fertilizers/pesticides to farmer/end users. Distributors - person(s) or entity(s) who sells fertilizer/pesticide to dealers and outlets only. Distributors get their supply directly from importers/manufacturers. Handler - exporter, importer, indentor, processor, manufacturer, formulator, distributor, supplier, dealer, and repacker of fertilizer and pesticide products. License - the written authority granted by FPA to any individual or firm to manufacture/process, supply, distribute and sell pesticides, fertilizers and plant growth promoting materials for commerce. Outlet - additional store owned by a dealer.

2 Requirements for Dealers/Outlets Any person, partnership or corporation desiring to sell fertilizers, pesticides and other agricultural chemicals has to apply and secure a license from FPA. In addition to the filling of application for dealership license, the following are also required from the applicants: 1. Copy of the latest Income Tax Return (for single proprietorship) 2. Copy of latest financial statement (for corporation) 3. Copy of any of the following: a) SEC Registration - for corporation or b) DTI Registration - for single proprietorship, or c) CDA Registration - for cooperatives 4. Inspection Report and recommendation from the FPA Provincial Officer 5. Copy of Certificate of Attendance to the two-day ASD Training 6. Passing of ASD accreditation examination 7. List of fertilizer/pesticide companies/distributors represented and trade names of products sold 8. "Good Housekeeping Compliance Certificate" issued by FPA and CRAN representative 9. Applicant must have a weighing scale of kg. Capacity (for fertilizer dealers) 10. Payment of the license fee Licensing Policies 1. All FPA licensees or applicants for fertilizer/pesticide dealership/retail/outlet/ibo license must have an ASD under their employ or must be trained as such for the purpose of supervising, advising and assisting buyers of fertilizers/pesticides on the safe handling and storage and the proper, safe and judicious use during the day to day operation of the store or business enterprise in the case of IBOs. 2. ASD is required to be personally present at the store. 3. Importers/registrants/distributors are prohibited from supplying fertilizer/ pesticide products to dealer stores with no ASD. Similarly, the aforementioned handlers, particularly the so-called Mother Companies, are prohibited from supplying fertilizer/pesticide products to IBOs who are not trained and accredited by FPA as an ASD. 4. Dealers can get their stocks from any suppliers who can give them better sales terms. 5. A separate application fee shall be paid for each branch/outlet. If a dealer owns a chain of stores/outlets, each shall be separately licensed (Memorandum dated 16 July 1982). 6. License issued by FPA is valid for three years. However, FPA has the right to revoke the license should the agro-retailers/dealers be found in possession of/or selling unregistered, adulterated, fake and off-specs products/or products obtained from unlicensed sources. 7. FPA encourages the organization of provincial agro-retailers/dealers association (Memoranda dated 14 August 1979 and August 1995). Dealer applicants who are members of the association shall be entitled to a 20% discount on license fee. 8. Renewal of license should be filed at least 3 months before the expiry date. Application for renewal filed one month after expiry date shall be subject to 50% surcharge. Those filed after the said period shall be subject to a 100% surcharge.

3 Good Housekeeping Requirement With the objective of (a) creating/increasing awareness and adoption of "Good Housekeeping" practices, and (b) monitoring compliance with FPA rules and regulations through actual audit of warehouses and stores, all licensed pesticide dealers and distributors, including new applicants are required to meet the minimum standards of "Good Housekeeping". A team composed of FPA representative(s) and CRAN member(s) shall audit the dealers'/distributors' compliance with "Good Housekeeping" in their warehouses and stores for at least once a year. Integral to "Good Housekeeping" is the presence of appropriate tools/gadgets to contain spillage of toxic materials and maintain cleanliness and orderliness. Risk Appraisal Checklist for Warehouse/Store Form (Annex C) shall be used during the audit. Proof of compliance shall be in the form of "Good Housekeeping Compliance Certificate" to be issued by the audit team. Those who fail to meet the minimum standards shall be notified of their deficiencies. The audit team shall set a deadline for the dealer/distributor to make the improvements. Lesson 2. LICENSING OF MANUFACTURERS, IMPORTERS, INDENTORS AND DISTRIBUTORS General and Specific Requirements The licenses for these types of handlers are good only for one year and have to be renewed thereafter. The licensing requirements and the corresponding fees depend on the type of activity and subscribed capitalization of the company. In addition to the filling of application, the following are the requirements for each type of handler: For Indentors - A copy of contract or authorization of manufacturer/supplier being represented in the Philippines including the list of brands/grades of fertilizers or pesticides being indented. For Importers - Brands/grades of fertilizers or pesticides to be imported in the Philippines. For Manufacturers/ - Formulators For Processors of - naturally occurring fertilizer/fertilizer raw materials For Bulk Handlers - For Distributors - Pre-licensing inspection report by the FPA on the plant site; facilities and manpower; indication of brands/grades to be produced, and Environmental Compliance Certificate (ECC) from the Environment Management Bureau of the Department of Environment and Natural Resource (DENR). A copy of Mining Permit from the Mines and Geosciences Bureau of the DENR. A list of bulk handling equipment owned/leased. A copy of distributorship agreement with the mother company and "Good Housekeeping Compliance Certificate" issued by CPAP Regional Area Network (CRAN) and FPA representative.

4 Delineation of Activities and Marketing Scope Memorandum Circular No. 2, dated 9 February 1994, states that distributors should sell only within the authority of the license issued by FPA. The guidelines specifically defined that no handler who has been issued with a license to operate as a dealer (retailer) shall act as distributor (wholesaler) in his area of operation. The same limitation applies to area distributors who, conversely, are selling their products at dealers' price/volume. A particular dealer can only act as a distributor upon application and subsequent issuance by FPA of a license to operate as a distributor. Likewise, a distributor can operate as a dealer upon issuance of a corresponding license. Lesson 3. DISTRIBUTION-RELATED POLICIES Registration of Warehouses The warehouse registration policy is covered under Memorandum dated 16 July 1982, addressed to all fertilizer and pesticide companies, distributors/dealers, and institutional end-users. This registration requirement aims to effectively monitor the supply and movement of agricultural inputs and improve the implementation of FPA rules and regulations. The Certificate of Warehouse Registration shall be prominently displayed inside the warehouse or storage area. Policy on Licensing Dealers to Repack Fertilizers Pursuant to Section 9 of P.D. 1144, repacking of fertilizer is prohibited unless duly authorized by FPA. Several memoranda were issued particularly the FIA Memo dated 10 July 1974 and FPA Memo dated 16 July M.C. No prescribes the rules, guidelines and regulations on the issuance of license to repack. "Repacker" refers to FPA licensed dealers. Inorganic and solid fertilizers may be repacked into 1, 2 or 5 kg. bags. Dealer applicant shall pay the repacking license fee and an appropriate weighing scale shall be required at the site. License to repack is co-terminus with the dealership license. Repacking requirements include the proper labeling and packaging. Bad order/damaged fertilizers should not be repacked

5 for retail. The FPA provincial/regional officer oversees that repacked fertilizers are free from adulteration and are not substandard or bad order fertilizers. Disposal of Damaged Fertilizers FPA shall exercise complete control on the movement and disposition of damaged fertilizers for which several memoranda have been issued to regional, provincial officers, fertilizer companies/suppliers, fertilizer insurance companies and trucking/shipping companies, to provide guidelines or ways to dispose of damaged fertilizers. These include the FIA Memorandum issued on 23 July 1974; 25 November 1975; 21 October 1975; 26 August 1976; 19 July 1979; 6 September 1977; 10 November 1979 and 27 July These guidelines dealt with inventory control, transshipment and movement from one area to another, permits to sell/dispose and pricing of damaged fertilizers, rebagging and bag labeling or markings as well as the penal provision for the violations of the guidelines. The damaged fertilizers shall be stored separately and shall be marked as "bad order" or "damaged" to protect the interest of the end-users. Sale of damaged fertilizers shall be made exclusively to the end-users; and that any resale by the end-users is a violation. Lesson 4. FERTILIZER PRODUCT QUALITY Legal Basis Pursuant to P.D. 1144, Section 6 paragraphs II (7), the FPA is mandated "to regulate and control the quality of the different grades of fertilizers". Section 8(d) makes it unlawful for any handler "to adulterate pesticide formulation and fertilizer grade". In line with these mandated functions, issuance of the implementing rules, regulations and guidelines promulgated by the FPA carried strict provisions concerning: a. Product quality, product specifications, nutrient analysis and other related issues for both imported and locally produced fertilizers. b. Enforcement of quality control standards for fertilizer (MC No. 13 May 1988), and