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

"SEC. 2. Definition of Terms.When used in this Act the following terms shall, unless the context otherwise indicates, have the following respective  meanings:

"(a) 'Gold Producer' means any person, corporation, partnership or association which produces gold as principal product or as by-product, by itself or through an operating agreement, during the effectivity of this Act;

"(b) 'Government' means the Government of the Republic of the Philippines;

"(c) 'Board' means the Gold Mining Industry Assistance Board created to carry out the provisions of this Act;

"(d) 'Cost of production' of bullion from a mine means the cost incurred by the producer and properly attributable to the production of bullion and includes mining, milling, smelting, refining, production tax, marketing expenses, transportation, administrative costs, depreciation and depletion under standardized procedure to be adopted by the Board, amortization of rehabilitation expenses and interests on capital loans;

"(e) 'Newly-mined gold' means any gold fresh from the mill or smelter which has never been in trade or commerce, certified as such by the gold producer and confirmed by the Board;

"(f) 'Free market' means domestic open market;

"(g) 'Assistance' is the amount (given by the Government to gold producers during the affectivity of this Act;

(h)  'Official price' means the equivalent in Philippine peso of the official world price of gold, which is presently fixed   at   $35   per   ounce,  based   on   the   official   rate of exchange of ?3.90 to U.S. $1.00, or any other rate that may subsequently be fixed by the Government;

"(i) 'Ounce'   means troy   ounce   which   is   one-twelfth

part  of  a  pound  of  five  thousand   seven  hundred sixty

grains, or four hundred eighty grains or 31.1035 grams;

"(j) 'Kenned gold' means gold that has been purified

to the fineness acceptable to the Central Bank;

"(k) 'Mine producing gold as principal product refers to a mine where the receipt from whatever source from the sale of gold is more than fifty per cent of the total receipts;  and

"(l)  'Mine producing gold as by-product'  refers to a mine where the receipts from whatever source from the sale of gold is fifty per cent or less of its total receipts.

"SEC. 4. Gold producers qualified to receive assistance. To  be entitled  to  the  assistance provided  in  this  Act, a gold producer must sell to the Central Bank, and the Central Bank is hereby directed to purchase,  its  entire production   of   newly-mined   gold,   whether produced   as principal product or as by-product,   at the official price defined in Section 2(h) hereof.    Should a gold producer sell his gold in violation of this section at any time during a certain year, the entire production for that year shall not   be  entitled   to  assistance.    Any assistance   already given shall be refunded, and the manager or person in-charge of the mining corporation that sells its gold produce or part thereof in violation  of this  section shall, upon conviction, be punished by a fine of not more than P5,000 or an imprisonment of not more than two years or both in the discretion of the court.    The Central Bank

shall issue a receipt for all gold purchased by it under this Act, which receipt shall show the number of ounces of gold purchased.

"SEC. 5. Manner of payment under this Act.In addition to the official price defined in Section 2(h), all gold producers shall receive assistance as follows:

"(a) Mines producing gold as by-product fifty pesos per ounce.

"(b) Mines whose annual production of gold as principal product is one hundred thousand ounces or less sixty pesos per ounce plus seventy per cent of the positive difference between the cost of production per ounce of gold and the official price: Provided, That this assistance and the official price shall not exceed two hundred sixty pesos per ounce.

"(c) Mines whose annual production of gold as principal product is more than one hundred thousand ounces fifty pesos per ounce plus sixty-five per cent of the positive difference between the cost of production per ounce of gold and the official price: Provided, That this assistance and the official price shall not exceed two hundred thirty pesos per ounce.

"Every gold producer enjoying assistance shall give a bonus equivalent to seven and one-half per cent of the assistance received to its employees whose salaries do not exceed five hundred pesos per month.

"Sec. 6. Term.This direct assistance shall cease when the present official world price of gold of US $35.00 per ounce is increased by international treaty or convention to an amount equivalent to at least seventy dollars per ounce.

"Sec. 10. Determination of the cost of production.The Board shall determine the cost of production of each gold mine every semester of each calendar year during the effectivity of this Act."

SEC. 2. This Act shall take effect upon its approval.

Approved, September 2, 1966.