FREQUENTLY ASKED QUESTIONS (FAQ)

What is the "One Town, One Product (OTOP) Philippines Act"?

The “One Town, One Product (OTOP) Philippines Act,” also known as Republic Act No. 11960, is a Philippine law that institutionalizes and appropriates funds for the OTOP Philippines Program. It aims to develop a self-reliant and independent national economy by promoting inclusive local economic growth through policies and programs that support micro, small, and medium enterprises (MSMEs). The program encourages MSMEs to produce and market distinct products and services that reflect their local community’s culture, resources, and creativity.

The OTOP Philippines Program has several key objectives:

(a) To provide a package of assistance for MSMEs in developing new, innovative, and complex products, with improvements in quality, design, packaging, standards, and marketability.
(b) To assist rural communities in growing the local economy and becoming more market-oriented and innovation-driven.
(c) To promote collaboration among local government units (LGUs), national government agencies, and the private sector for export and domestic market development.
(d) To formulate a national OTOP Strategic Development Plan.

The OTOP Philippines Program covers a wide range of products and skills-based services. These include:

Processed Foods: Such as fruits and nuts, local delicacies, juices, wines, teas, and baked goods.
Agricultural: based Products: Including coffee, cacao, and other agricultural produce, as well as processed products like meat, coconut, and seafood.
Home and Fashion Items: Creative artisanal products like gifts, souvenirs, furniture, garments, and textiles.
Arts and Crafts: Such as coco coir, weaves, bamboo products, paper artistry, and wood crafts.
Skills-based Services: Other services like hilor or traditional Filipino massage, sculpting, essential oils and wellness products, industrial goods, soaps, and other personal care goods and cosmetics. The Department of Trade and Industry (DTI) may also approve other goods and services.

OTOP products must meet specific criteria established by the DTI to qualify for the program:

Culture: They must embody cultural values rooted in local heritage, living traditions, customs, and rituals, often passed down through generations.
Community Resource: The product’s locality’s resources (raw materials, skills, and network) must be the basis of its production.
Connection: The product should evoke a sense of pride or emotional connection among the locals.
Creativity: The products should exemplify the Filipino people’s creativity and innovation.
Competitive Advantage: The product or service’s selection should be based on its unique or inherent strengths, considering factors like topography, climate, geographical location, and proximity to resources.

The evolution of the OTOP Program reflects its growing significance in local economic development. It was first launched in 2003 through Executive Order No. 176 as the “Isang Bayan, Isang Produkto, Isang Milyong Piso” Program under President Gloria Macapagal Arroyo. This early version encouraged LGUs to identify a flagship product and provided them with seed funding of one million pesos to support local enterprise. In the 2010s, the program continued under subsequent administrations but lacked institutional permanence, resulting in inconsistent implementation and limited integration into national MSME strategies. A major shift occurred during the Duterte administration when the program was revitalized as “OTOP Next Generation” or “OTOP Next Gen”, focusing on product development, design, quality, compliance with standards, packaging, and branding to make local products more competitive in domestic and international markets. Finally, in 2023, the passage of Republic Act No. 11960 formally institutionalized the OTOP Philippines Program, transforming it into a legally mandated national strategy for inclusive local economic development, complete with a multi-level governance structure, strategic direction, and long-term implementation framework.

OTOP Hubs are dedicated retail and promotional spaces showcasing accredited OTOP products. Under RA 11960, national agencies (DOT, CAAP, PPA, LTFRB) and LGUs are mandated to establish hubs in:

(a) Airports, seaports, and bus terminals

(b) Public markets and malls

(c) Municipal halls and tourism destinations

Tatak Pinoy is the national vision to make Filipino products world-class and globally competitive. OTOP operationalizes this at the grassroots level, by nurturing MSMEs, celebrating local heritage, and elevating product quality through targeted support.

It is a six-year plan required by RA 11960 that sets national goals, targets, and priorities for OTOP. It includes:

  • Priority products/services with high value-added potential
  • Annual performance indicators
  • Strategic marketing and operations frameworks
  • Annual review and update process with stakeholder participation

The OTOP Trustmark is an official certification that recognizes products under the OTOP Philippines Program that exemplify the country’s best. The Trustmark signifies that a business and its products have been assessed and marked as excellent in terms of quality, design, value, and marketability.

Drawing from Japan’s OVOP model, local governments and chambers of commerce can play a central role in grading and certifying products that represent their communities, ensuring quality and authenticity. In the Philippine context, a possible approach is for provinces to issue trustmarks with their own provincial branding, allowing local authorities—who understand their community’s culture, craftsmanship, and production realities—to certify products accurately and responsibly. The DTI, through its Provincial Offices, will provide guidance and technical assistance to LGUs to ensure compliance with national standards and consistency across local certification systems. This decentralized approach promotes stronger local ownership, enhances accountability, and allows for more responsive support to MSMEs, while the DTI ensures overall direction and coherence.