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@ ie 13 Republic of the Philippines

ef tel DEPARTMENT OF ENERGY

DEPARTMENT CIRCULAR NO, DC 20}4 -I1- OO a

PROMULGATING A REVISED RULES AND REGULATIONS
GOVERNING THE BUSINESS OF RETAILING LIQUID FUELS

WHEREAS, Republic Act (RA) 8479, otherwise known as the "Downstream Oil Industry
Deregulation Act of 1998", mandates the Department of Energy (DOE) to promote fair trade
practices, monitor marketing processes and quality of Liquid Fuels and stop the operation of
businesses involved in the sale of Liquid Fuels not complying with the national standards of
quality;

WHEREAS, Batas Pambansa Big. (BP) 33, as amended by Presidential Decree No, (PD) 1865,
and the Implementing Rules and Regulations therefore, define and penalize certain prohibited
acts that are considered inimical to national interest and public safety, including illegal trading

in petroleum or Liquid Fuels, hoarding of Liquid Fuels, adulteration and underdelivering, among
others;

WHEREAS, DOE Department Circular Nos. 2003-11-010 and 2013-09-0021 establish the

minimum requirements for operation of Retail Outlets and Prescribe the rules and regulations
governing the quality of Liquid Fuels;

WHEREAS, Republic Act No. 9367, otherwise known as the Biofuels Act of 2006, and its
Implementing Rules and Regulations, specifically Department Circular No. DC 2007-05-0006,
Department Circular No. DC 2011-02-0001, DC 2015-06-0007 and Joint Administrative Order
No. 2008-1, Series of 2008, direct the use of biofuels, including the sale and distribution
thereof, and define and prescribe the fines and penalties for violation thereof;

WHEREAS, there are persons engaged in the Retailing of Liquid Fuels that do not comply with
safe and appropriate technologies, including the use of containers such as in "bote-bote",
aboveground storage tanks and mobile Liquid Fuels dispensing pump;

WHEREAS, the Retailing of Liquid Fuels is subject to pertinent permits and licenses issued by
government authorities including not limited to, Department of Environment and Natural
Resources, Bureau of Fire Protection, Bureau of Internal Revenue and Local Government Units;

WHEREAS, the safe and Proper handling, transport, storage, installation and use of equipment
and facilities in the downstream oil industry are governed by the pertinent Provisions of the
different national and international safety codes observed and adopted by the industry;

WHEREAS, the continued use of unsafe and substandard methods of retailing Liquid Fuels (i)
exposes the consuming public to fire, danger, health and environmental risks; (ii) denies the
public the proper quality and quantity of the Liquid Fuels they purchase; (iii) Constitutes unfair
competition and unduly deprives legitimate Retail Outlets of additional sales volume; (iv)
deprives the government of revenue derived from licensing fees, local business taxes and pump
calibration charges, among others; and .(v) encourages the marketing of Liquid Fuels sourced
from illegal activities such as smuggling, pilferage, theft and the like;

WHEREAS, emerging technologies and economic developments are expanding the nature of
the business of retailing of Liquid Fuels which may include electric vehicle (EV) charging, battery
swapping, among others;

WHEREAS, Department Circular No. 2003-11-010 and certain provisions of Department
Circular No. 98-03-004, otherwise known as the Rules and Regulations Implementing RA 8479,
and the Rules and Regulations in the Implementation of BP 33, aS amended by PD 1865, need
to be further clarified, supplemented, updated and amended and/or repealed, particularly in the

conduct of the Liquid Fuels Retailing business;

eee
Energy Center, Rizal Drive, Bonifacio Global City, Taguig City, Metro Manila, Philippines
Tel No.: 840-2187 840-2155 840-2130 Fax: 840-2095 *Trunkline: 479-2900

Website: www.doe.gov.ph * E-mail: info@doe.gov.ph

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NOW, THEREFORE, in consideration of the foregoing premises, the following Rules are hereby
promulgated to govern the Retailing of Liquid Fuels,

RULE I
GENERAL PROVISIONS

Section 1. ‘Title. This Department Circular shall be known and cited as "Promulgating a
Revised Rules and Regulations Governing the Business of Retailing Liquid Fuels" or "Revised
Retail Rules",

Section 2. Coverage. The Revised Retail Rules shall apply to all persons engaged or
intending to engage in the business of Retailing Liquid Fuels.

Section 3. Definition of Terms. Except as provided below, the terms used in these Revised
Retail Rules shall have the same meaning as the terms used in Department Circular No. 98-03-

004, as amended (Implementing Rules and Regulations of the Downstream Oil Industry
Deregulation Act of 1998):

a. API - shall refer to the American Petroleum Institute;

b. Appropriate container - shall refer to portable containers that adhere to any existing

and Diesel Containers for Consumer Use, as well as the designs to be subsequently

C. BFP - shall refer to the Bureau of Fire Protection;

d. Bote-bote- shall refer to the manner of retailing and dispensing of Liquid Fuels using
soda bottles, plastic containers, jugs, aboveground tanks, portable tanks, road tankers
or vehicles or other similar portable containers not intended for storage of flammable

Liquid Fuels, and/or to the manner of retailing and dispensing of Liquid Fuels using the
said containers;

e. Calibration - shall refer to the Process of checking, adjusting, or determining by
comparison with a standard the condition of the dispensing pump to ensure delivery of
accurate quantity of Liquid Fuels;

f. Company - as used in this Circular, shall refer to an oil company or an entity, engaged
in any or a combination of activities in the Downstream Oil Industry, other than purely
operating a Retail Outlet;

g. Dispensing - shall refer to the act of transferring Liquid Fuels from the dispensing pump
or “bote-bote” containers to the vehicles of motorists, end users or other consumers;

h. Dispensing pump - shall refer to an equipment used to deliver or dispense Liquid Fuels
and which is installed in a forecourt/curb area within the Retail Outlet which is composed
of a dispensing nozzle and a volumetric meter;

i. DENR -shall refer to the Department of Environment and Natural Resources;

j. DOE -shall refer to the Department of Energy;

k. Field Offices- shall refer to the DOE Field Offices in Pangasinan (Luzon Field Office),
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Cebu (Visayas Field Office) and Davao (Mindanao Field Office) and to other field offices
that may subsequently be created;

I. LGU - shall refer to Local Government Unit;
m. Liquid Fuels - shall refer to gasoline, diesel, and kerosene;

n. NML -shall refer to the Nationa! Metrology Laboratory of the Department of Science and
Technology - Industrial Technology Development Institute;

0. OIMB - shall refer to the Oil Industry Management Bureau of the Department of Energy;

p. Person - shall refer to any person, whether natural or juridical, who is engaged in any
activity of the downstream oil industry;

q. PNS - shall refer to the Philippine National Standard;

r, Retailing - shall refer to the act of selling and/or dispensing Liquid Fuels by the Retail
Outlet directly to the motorists, end-users or other consumers;

S. Retail Outlet - shall also refer to a dispensing station, refilling station facility or
business establishment which sells or dispenses Liquid Fuels directly to motorists, end-
users or other consumers;

t. Retail Outlet Official - shall refer to the dealer, operator, owner or proprietor of the
Retail Outlet or in their absence, the manager, supervisor, team leader or any
responsible person acting as such;

u. Tank Truck - shall refer to any single self-propelled motor vehicle with or without a
trailer, equipped with a cargo tank mounted thereon or built as an integral part thereof,
and used for the transportation or handling of Liquid Fuels; otherwise known as lorry and
road tanker;

Vv. Test Measure - shall refer to a calibration bucket that is used to measure the quantity
of Liquid Fuels; and

w. UGT - shall refer to underground storage tank.

RULE II
Certificate of Compliance and Certificate of Non-Coverage

Section 4. Issuance of Certificate of Compliance (COC) and Certificate of Non-
Coverage (CNC).

a. No person shall engage or operate the business of Retailing Liquid Fuels without first
securing a valid Certificate of Compliance (COC) from the oil Industry Management Bureau
(OIMB) or its counterparts in the Field Offices.

Those engaged in the business but have not secured or have not submitted the complete
requirements necessary for the issuance of a valid COC under the DOE DC 2003-11-010
shall be considered as new applicants and shall be covered by this Rules.

The OIMB or the Field Offices shall issue a COC for each Retail Outlet upon the complete
submission of and full compliance by the Retail Outlet with the requirements provided in
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the provisions of this Rules and payment of the required fees.

The OIMB or the Field Offices shall have the authority to verify, validate, authenticate
and inspect all documents and information required from, given by or obtained from such
person for compliance with all applicable laws, rules and regulations.

The OIMB or the Field Office may conduct field validation to a new Retail Outlet prior to
the issuance of the COC.

b. In situations where an LGU shall require a COC asa prerequisite to a Mayor's or Business
Permit, a Certification may be issued to a new Retail Outlet solely for that purpose of obtaining
the Mayor’s or Business Permit: Provided, That an authenticated copy of the Mayor's or
Business Permit is submitted to the OIMB or the Field Offices within thirty (30) days from
issuance of the Certification, otherwise the latter shall be deemed automatically revoked and
the Retail Outlet shall immediately cease to operate. Provided, further, that, a Certification may
be renewed should there be a delay in the issuance of the Mayor's or Business Permit.

c. Storage and dispensing of Liquid Fuels that are for own- use Operation shall not be
covered by this Revised Retail Rules Only upon issuance of a Certificate of Non-Coverage (CNC)
by the DOE. For purposes of this Revised Retail Rules, own- use operation shall refer to the
operation of a motor vehicle fleet.

A CNC shall be issued provided that the establishment or entity shall ensure that:

1. They file with the OIMB or the Field Offices a duly-acknowledged formal letter
request for a CNC under these Rules;

2. They present a Feasibility Study indicating, among others, number of vehicles and
financial viability of putting up such establishment;

3. They submit valid Membership Agreement and latest Supply Agreement or
Certification issued by an OIMB-registered distributor and/or Supplier;

4. They present pertinent LTO/LTFRB/LGU documents confirming their fleet;

5. They do not provide retailing services as defined and as provided for in Section 3
hereof;

6. Their dispenser/s does not have “money wheels” or “price indicators”, For
Purposes of this Revised Retail Rules, a “money wheel” is the price-indicating
device of the Liquid Fuels dispensing pump that indicates the amount corresponding
to the volume of product dispensed from the nozzle; and

7. Their station shall only dispense Liquid Fuels to the vehicles of their members as
identified through a distinguishing mark in their vehicles and membership
identification cards.

Storage and Dispensing of Liquid Fuels for Own-use shall be subject to the extended
responsibility of the Liquid Fuels distributor and supplier, The distributor and supplier of
Liquid Fuels shall ensure compliance of the storage tanks and dispensing pump to
existing international and local standard.

Notwithstanding the issuance of a CNC, the OIMB and the Field Offices can, at their
discretion, monitor and conduct verification and validation on the operation of the
establishment. The CNC does not preclude compliance with PNS/DOE FS 1-1:2005
“Petroleum Products - Retail Outlet - Health, Safety and Environment” and with the
requirements of other government agencies.

Section 5. Validity of the COC. The COC shall have a validity of five (5) calendar years
reckoned from the date of its effectivity and shall be in full force and effect unless sooner
revoked or suspended Pursuant to the provisions of this Circular,

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Section 6. Documentary Requirements. A prior notice, through an application for the
issuance of COC for each Retail Outlet, shall be accomplished under oath and filed with the
OIMB or the Field Offices by the applicant and shall contain the following information and
supporting documents which shall be submitted in their original forms for verification, or if the
submission of the original copy is not possible or warranted, in duly-certified true copies by the

issuing agency. Only applications with complete and valid Supporting documents shall be
accepted and processed.

In the event that the applicant has a proof of a pending application to other government
agencies, the OIMB and the Field Offices May accept and process the application. The
corresponding COC shall only be issued upon submission of the government permits/clearances.

a. Application

1. — Filled-up duly-notarized application form complete with the following information:

a) Business name, address, telephone/fax number and e-mail address of the
business office;

b) Location and complete address of the Retail Outlet; and

c) Name of dealer or retailer in case of single Proprietorship, or partners in case
of partnership, or authorized representative in case of corporation.

2. A Notice of Undertaking on liability in case of violations committed by dealer,
operator, owner or proprietor.

b. Supporting Documents

1. Certification from distributor/supplier/dealer’s agreement;

2. Notarized Statement that the facility design and operation of the Retail Outlet is
PNS-compliant signed by the Engineering Procurement Construction Contractor and
Dealer/Owner of the Retail Outlet;

Se List of dispensing pumps/hoses and underground storage tank/s with corresponding
Capacity/ies;

4. Scaled lay-out plan showing the island/dispensing pumps, underground storage
tanks, cashier’s booth and other facilities;

5. Accomplished DOE Form on Undertaking;

6. Latest photographs (in 5R size) showing the full/front, right, and left side views
including price display boards, safety informational signs and required
stickers/labels for RON, E-10, B-2, among others;

7. DOE SCC/COC Clearance of No Pending Case, as applicable; and

8. Payment of fee,

c. Reportorial Requirements. Any Person or entity who is engaged in the retailing
business of Liquid Fuels shall submit every 30% day of January, under oath, copies of the
following:

1. Data on Purchase and Sales Volume per Retail Outlet; and

2. Authenticated copy of distributor/supplier/dealer’s agreement, if previous is
expired.

Failure to comply with the Documentary Requirements shall constitute a violation of this Section
and punishable under Section 29 of this Rules,

Section 7. Renewal of COC.

a. The Retail Outlet shall file the application for the renewal of the COC not later than one

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(1) month before the expiration date, The following shall be submitted to the OIMB or
the Field Offices:

Photocopy of previous COC;

DOE SCC/COC Clearance of No Pending Case, as applicable;

Payment of fee; and

A Notice of Undertaking on resumption of liability in case of violations committed by
previous dealer, operator, owner or Proprietor,

ee i

After the expiration of the COC, any application to operate the Retail Outlet shall be
treated as new application.

b. A change in the dealership, retailership, ownership or proprietorship of a Retail Outlet
shall not automatically transfer the COC of the previous Retail Outlet Official to the new
one. The new Retail Outlet Official shall file for a new COC, submit the pertinent
documents pursuant to this and pay the required fees.

Section 8. Non-Issuance, Non-Renewal, Revocation or Suspension of COC. The OIMB
or the Field Offices shall have the authority to deny the issuance or renewal of a COC or to
revoke or suspend the same on any of the following grounds:

a. Refusal to allow inspection by OIMB or the Field Offices;

b. Failure to present required records during inspection, or upon order by the OIMB or the

Field Offices e.g., calibration record, record of product deliveries to the Retail Outlet

showing the distributor/supplier(s), product details and date;

Submission of falsified documents;

Failure to pay fines imposed by the DOE;

Commission of the same prohibited act for at least a second time; or

Failure to comply with circulars and administrative issuances promulgated by the DOE;

or

g. Failure to present related government permits/clearances such as, Mayor’s/Business
Permit, Locational/Zoning Clearance, Fire Safety Inspection Certificate and
Environmental Compliance Certificate, if applicable.

7>oan

An order of Suspension or Revocation and Termination may be issued when any of the
circumstances upon which the COC was issued no longer exists, modified or voided, become
impossible, or any analogous circumstances.

A Retail Outlet that continues to operate/engage in the business of retailing Liquid Fuels after an
Order of Revocation or Suspension of business will be recommended to the concerned Local
Government Unit for revocation or suspension of its Mayor's or Business Permits.

Section 9. Posting of COC. The COC shall be prominently displayed in the Retail Outlet in a

conspicuous location for easy viewing/inspection by its customers and the public. The failure to
post COC shall constitute Illegal Trading.

that indicates:

a. LTO Registration OR/CR;
b. DOST Calibration Report;
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c. Permit to Transport Flammable Liquids by Tank Truck or Conveyance Permit;
d. Copy of COC of Retail Outlet, as applicable; and
e. Payment of fee.

RULE III
STANDARDS AND REQUIREMENTS

Section 11. Mandatory Standards and Requirements for New Retail Outlets. The

applicant for COC shall strictly comply with all the standards and requirements prescribed in the
PNS specifically on the following features:

a. Fixed and Permanent Dispensing Pump

1. Dispensing pumps shall be located six (6) metres from any potential source of
ignition;

2. There shall be no open flame within 15 metres unless provided with an adequate
safety barrier/enclosure, such as but not limited to glass enclosure and perimeter
wall, separating the open flame from the dispensing pump and comply with the

the Philippines of 2008”;

3. Dispensing hose shall have a maximum length of 5.5 metres (18 ft.); and

4. Dispensing pump shall accurately display both the volume of Liquid Fuels dispensed
(in litres) and the corresponding amount (in Pesos), up to two (2) decimal places.

b. Forecourt

1. Pump Island (Single pump)
a) Minimum dimension shall be 3.5 metres x 1.2 metres;
b) Lane-oriented pump should have a minimum distance of 0.05 metres from
fixed object; and
Cc) Pump guard, or its equivalent (e.g. column Post), serving as Safety barrier

and can withstand vehicular impact for the dispensing devices shall be
present.

Edge to edge distance between pump islands shall be 6 metres measured along the lane
and 6 metres from side to side;

2. Ingress and Egress
a) The minimum width of the ingress and egress for the Retail Outlet shall be 7
metres (23 ft.), for each, based on the standard car and large vehicle turning
radii; and
b) At any given time, the Retail Outlet shall only serve the vehicles and tank
trucks it can accommodate within its premises.

c. Facilities

1. There shall be Office/Cashier’s booth;

2. Canopy shall have a minimum height of 4,5 metres from floor line to Canopy
ceiling;

3% Boundary walls shall be made of hollow concrete blocks or cyclone fence;

4. A master switch shall be installed at a central control point that will disconnect the

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