SOP Exhibits

Title:

Duties and Prohibitions of Licensed/Franchised Bonded Warehousemen, Millers, Shellers/Threshers/Dryer Owners and/or Operators

SOP Number : BR-RL06

Appendix C-1

DUTIES AND PROHIBITIONS
OF LICENSED/FRANCHISED BONDED WAREHOUSEMEN, MILLERS,
SHELLERS/THRESHERS/DRYER OWNERS AND/OR OPERATORS

Duties:

1. Display of License/Franchise Certificate and Signboard

Every licensed warehouseman, miller, sheller, thresher or dryer owner
and/or operator, or franchisee, shall display in a conspicuous place
in his/her establishment, the license/franchise certificate issued by
the Authority for ready inspection by the Administrator or his duly
authorized representative at all times. Likewise, he/she shall display
in a conspicuous place on the exterior wall of his establishment, a
signboard measuring at least 75 cm. in width and 135 cm. in length,
bearing the name or business name of the licensee, the NFA Control
Number and the words "Licensed Rice Mill" or "Corn Mill" as the
case may be, "Grains Bonded Warehouse" in case of bonded warehouse,
or "Franchised Grains Bonded Warehouse" in case of franchised bonded
warehouse;

2. Issuance of Warehouse Receipts

Every licensed/franchised bonded warehouseman shall issue negotiable
or non-negotiable warehouse receipts to cover third party deposits or for
his/her own stocks, in the form and manner provided under Section IV,
Regulation VII hereof. Rice and/or corn mill or sheller, thresher or dryer
owners/operators shall, on the other hand, issue their own receipts duly
registered with the Authority to cover the grains delivered to them for
milling, shelling, threshing or drying.

3. Records Keeping

Every licensed/franchised bonded warehouseman shall maintain in his
office or warehouse a complete record of his transaction in a Record
Book prescribed by the Authority. Those who are also rice and corn
millers shall keep a separate and uniform system of accounting and
records keeping of deposits and withdrawals in the manner and form
to be prescribed by the Authority;

Every licensed rice and/or corn miller, corn sheller, thresher or dryer
owner/operator shall maintain in his office/establishment, a complete
record of his transactions and may be required from time to time to
report to the Authority the quantity of grains they have stored, milled,
shelled, threshed or dried, during a specified period.

4. Submission of Weekly Stock Reports

Every licensed/franchised bonded warehouseman shall submit to the
Authority a weekly report in writing showing:

a. The name and address of the depositor;
b. The quantity and dates the grains were stored
and withdrawn;
c. The quantity of grains stored which belongs
to him; and
d. Such other information as the Authority may
require from time to time.

This weekly report shall be prepared every Saturday and submitted to
the Authority on the same day.

5. Allow Inspection of Establishment/Facility and Records

Every licensed/franchised bonded warehouseman, miller, and/or
sheller, thresher, or dryer owner/operator shall permit the Administrator
or his duly authorized representatives to enter and inspect or examine
at any reasonable time of the day, with or without prior notice, his/
her licensed/franchised bonded warehouse, mill, sheller, thresher
or dryer, the office thereof, the books of account and records
relating thereto and the contents thereof. Such warehousemen,
miller, and/or sheller, thresher or dryer owner/operator shall extend to
such inspecting officer or agent the necessary assistance or help to
enable him to perform such inspection or examination in an expiditious
way.

6. Pest Control

It shall be mandatory for the warehouseman to institute adequate pest
control measures to maintain the quality of the grains deposited in his
warehouse. However, if inspite of the exercise of extraordinary diligence,
the warehouseman finds that the grains stored or deposited in his
warehouse are deteriorating and that such deterioration can no longer be
stopped, he/she shall immediately notify either personally or by registered
mail the Authority and any of the following:

a. The person holding the warehouse receipt if known to
the warehouseman;
b. The person known who originally deposited the grains;
c. Any person known by the warehouseman to be interested
in the grains.

Such Notice shall be posted in the municipal or city hall of the place where
the warehouse is located. It shall state among other things:

a. The name and location of the bonded warehouse in which
the grains are stored or deposited;
b. Actual condition of the grains if it could be ascertained, if known
for such condition;
c. The outstanding receipts covering the grains, giving the number
and the date of issuance; and
d. That the grains shall be delivered upon the r return and surrender
of the receipts therefor.

If after seven (7) days from the date the notice is sent to the parties
concerned, the grains are not withdrawn by them the warehouseman,
in the presence of the Administrator or his duly authorized representative,
may sell the same at a public auction at the expense and for the account
of the owner. Nothing contained in this and the preceding paragraph
shall be construed as relieving the bonded warehouseman from properly
caring for the grains after notification of its condition has been given by
him/her to the above-named parties.

7. Packaging, Labelling and Weight Measuring

a. Every licensed warehouseman/miller/sheller, shall pack the palay/
milled rice/shelled corn in durable jute or plastic sacks or in
similar protective containers (for palay); milled corn grits, in new
or good used hessian cloth bag, jute, gunny or plastic sacks without
patches, to give maximum protection from normal hazards of
transportation and handling and in accordance with the SOP on
color coding to protect the interest of the consumers;

b. Every licensed warehouseman, miller or sheller owner/operator
shall label the milled rice, milled corn grits, or shelled corn in
suitable tags prescribed in Regulation XV hereof;

c. Every licensed warehouseman or milled shall adopt the metric
standard of weight measurement in kilogram and the "cavan"
of rice and corn, milled or unmilled, shall be a unit containing
fifty (50) kilograms of such grains, net weight.

Prohibitions:

1. Unthreshed palay in straws or bundles shall not be accepted for storage;

2. Engaging in the grains business without a valid NFA license;

3. Short weighing/mislabelling in the sale of rice and/or corn;

4. No label/tag on rice and/or corn traded or marketed in bags/sacks;

5. Unauthorized possession of government stocks of rice and/or
corn;

6. Remilling of government stocks without written authority or approval by
the NFA;

7. Every licensed/franchised bonded warehouseman shall not mix or
pile up with the palay/corn grains received by him/her for storage in
his/her warehouse any palay./corn by-products such as husk or
"ipa", "tiki-tiki", binlid "mata-mata" and other kinds of by-products;

8. Without the consent and approval of the Authority, no licensed/franchised
bonded warehouseman shall allow any person or any other grains dealer
to occupy any part of his/her bonded warehouse, either for office use or
storage of grains of such person/grains dealer unless such grains are
treated as deposits therein;

9. Any licensed/franchised boned warehouseman or miller receiving and
keeping at any quantity of stored grains deposited more than that
authorized and specified in his/her license/franchise certificate shall be
presumed to have violated the provisions of Presidential Decree No. 4
as amended, and its implementing rules and regulations;

Grains received during the preceding year but not yet withdrawn shall
be included in determining the quantity of grains received and stored
at any one time;

` 10. A licensed warehouseman, miller and/or sheller, thresher or dryer owner/
operator shall not make unreasonable or exorbitant charges for services
rendered. Before a license to operate a warehouse, mill, sheller, thresher
or dryer is granted, the grains businessman concerned shall file with the
Authority a copy of the schedule of charges to be used by him/her when
licensed. Before making any change in such schedule of charges, he
shall file with the Authority a written statement showing the proposed
charges and the reasons therefor. Increasing charges without authority
from NFA is strictly prohibited.

Such proposed increase in charges once approved shall be posted in a
conspicuous place in the warehouse or mill or in the sheller, thresher
or dryer building.

11. Every licensed/franchised bonded warehouseman, mill, sheller, thresher
or dryer owner/operator shall not remove or dispose of any grains received
by him for storage, milling, shelling, threshing or drying, without the written
consent of the depositor/holder of the warehouse receipt or of the owner
of the grains delivered for milling,shellling, threshing, or drying only and
nothing such removal/disposal on the receipt issued therefor.