The RA 9520

AN ACT AMENDING THE COOP

CODE OF THE PHILIPPINE TO
BE KNOWN AS THE PHILIPPINE
COOP CODE OF 2008
 Chapter 1 – General Concepts
and Principles
Art. I – Title Phil. Coop Code of 2008
Art II – Declaration of Policy
• The state to foster the creation and growth of coops as a
practical vehicle for promoting self-reliance
• The government and all its branches, subdivisions,
instrumentalities and agencies shall ensure the provisions
of technical guidance, financial assistance and other
services to enable cops to develop….
• The state recognizes the principle of subsidiarity under
which the coop sector will initiate and regulate within its
own ranks the promotion and organization, training and
research, audit and support services relating to coops with
government assistance where necessary.
Art 3 – General Concepts
“A coop is an autonomous and duly
registered association of persons, with a
common bond of interest, who have
voluntarily joined together to achieve their
social, economic and cultural needs and
aspirations by making equitable
contributions to the capital required,
patronizing their products and services and
accepting a fair share of the risks and
benefits of the undertaking in accordance
with universally accepted coop principles.”
Art 4 –Coop Principles:
 Voluntary and Open Memberships
 Democratic Member Control
 Member Economic Participation
 Autonomy and Independence
 Education, Training and
Information
 Cooperation among Coops
 Concern for Community
Art 5 – Definition of Terms
Member – person either natural or juridical who,
adhering to the principles set forth in this Code and
in the articles of cooperation has been admitted by
the coop as member;

General Assembly – the full membership of the coop

duly assembled for the purpose of exercising all the
rights and performing all the obligations pertaining
to coops….

Board of Directors (BODs) – the body entrusted with

the management of the affairs of the coop under its
articles of cooperation and bylaws;

Committee – anybody entrusted with specific functions

and responsibilities under the bylaws or resolution
of the general assembly or the board of directors;
 Chapter II – Organization and Registration

Art. 6 – Purpose
 To encourage thrift and savings mobilization
among the members;
 To generate funds and extend credit to the
members for productive and provident
purposes;
 To encourage among members systematic
production and marketing;
 To provide goods and services;
 To develop expertise and skills among its
members;
 To promote and advance the economic, social
and educational status of the members;
 To advocate for the cause of the coop
movement;
Art. 7 – Objectives and Goals of a Coop
 Provide goods and services to its members;
 Provide optimum social and economic
benefits to its members;
 Teach them efficient ways of doing things
in a cooperative manner;
 Propagate coop practices and new ideas in
business and management;
Art 9 – Coop Powers and Capacities
 To the exclusive use of its registered name, to sue
and be sued;
 Of succession;
 To amend its articles of cooperation in accordance
with the provisions of this Code;
 To adopt by-laws not contrary to law, morals or
public policy, and to amend and repeal the same in
accordance with this Code;
 To purchase, receive, take or grant, hold, convey,
sell, lease, pledge, mortgage….
 To form subsidiary coops and join federations or
unions, as provided in Code;
 To avail of loans; be entitled of credit and to accept
and receive grants, donations and assistance from
foreign and domestic sources…..
Art 10 – Organizing a Primary Coop
 15 or more natural persons who are Filipino
citizens, of legal age, having a common bond
of interest, and are actually residing or
working in the intended area of
operations…….
 a prospective member must have completed a
Pre-membership education seminar (PMES)
 A single-purpose coop may transform into a
multi-purpose only after two (2) years of
operations
Art 11 – Economic Survey
 this describes the structure and purposes
of the proposed coop;
 the structure should include a
bookkeeper

Art 13 – Term
 a coop shall exist for a period not
exceeding fifty (50) years from the date
of registration unless sooner dissolved or
unless said period is extended
Art 14 – Articles of Cooperation
Contents:
 the name of the coop which shall include the word
coop;
 the purpose/s and scope of business;
 the area of operation and the postal address of its
principal office;
 the names, nationality and the postal addresses of
the registrants;
 the common bond of membership
 the list of names of the directors who shall
manage the coop;
 the amount of its share capital, the names and
residences of its contributors
 statement of whether the coop is primary,
secondary, or tertiary;
continuation…….
 Four (4) copies are to be submitted to CDA
 It should have the bonds of the accountable
officers and a sworn statement of the
treasurer showing that at least 25% of the
authorized share capital has been
subscribed and at least 25% of the total
subscription has been paid. The paid-up
share capital should not be less than
P15,000.00.
Art 15 – Bylaws
This provides the following:
 The qualifications for admission to membership and
the payment to be made….
 Rights and liabilities of memberships;
 Circumstances under which membership is acquired,
maintained and lost;
 Procedure to be followed in cases of termination of
membership;
 The rules and procedures on the agenda, time, place,
and manner of calling, convening; conducting
meetings, quorum requirements, voting systems, and
other matters.
 The powers and duties of the general assembly, BODs,
committees and officers….and their qualifications and
disqualifications.
 The accounting and auditing systems;
 The manner of loaning and borrowing
Art 16 – Registration
 Certificate of registration to be issued by CDA 60
days from the filing thereon, otherwise the
application is deemed approved unless the cause
of the delay is attributable to the applicant.
 In case of denial, an appeal shall lie with the Office
of the President within 90 days from receipt of
notice of such denial. Failure of the Office of the
President to act on the appeal within 90 days from
the filing thereon shall mean approval of the said
application.

Art 17 – Certificate of Registration

 The Certificate to be issued by the CDA shall be a
conclusive evidence that the coop is duly
registered…
Art 18 – Amendment of Articles of
Cooperation and By-laws
 Requires two-thirds (2/3) votes of all the
members with voting rights
Art 23 – Types and Categories of coops
 Credit – savings and lending services
 Consumers – procure and distribute commodities
 Producers – joint production whether agri or industrial.
 Marketing – supply of production inputs to members and market their products.
 Service – e.g. medical, dental, transpo, insurance etc.
 Multi-purpose – combinations of 2 or more types
 Advocacy – promotes and advocates cooperativism
 Agrarian Reform - organization of marginal agrarian reform farmers
 Coop Bank – provides a wide range of financial services to coops and their members
 Dairy Coop – production of fresh milk which may be processed and/or marketed as dairy
products
 Education – the primary purpose of owning and operating licensed educational institutions
 Electric – undertaking power generation, utilizing renewable energy sources, including
hybrid systems,
 Financial Service – engaging in savings and credit services and other financial services

Other types:
 Fisherfolks - Transport
 Health Services - Water Service
 Housing - Insurance
Categories:
 Membership:
a.1 Primary – members are natural persons
a.2 Secondary – members are primaries, and
a.3 Tertiary – members are secondary coops

 Territory:
- According to areas of operations
 Chapter III – Membership
Art. 26 – Kinds of Memberships
 Regular – one who has complied with all the
membership requirements and entitled to all
the rights and privileges of memberships.
 Associate – has no right to vote nor be voted
upon and shall be entitled only to such rights
and privileges as the bylaws may provide.
 A coop organized by minors shall be
considered a laboratory coop and must be
affiliated with a registered coop.
Art 27 – Government Officers and Employees
 Officers or employees of CDA shall be disqualified
to be elected or appointed to any position in a
coop: provided that the disqualification does not
extend to a coop organized by the officers or
employees of the CDA.
 All elective officials shall be ineligible to become
officers and directors of coops. Exemptions to
party list representatives being officers of a coop
he or she represents.
 Government employee or officials are allowed to
use official time for attendance in any coop
trainings or related activities provided that the
operations of the office concerned are not
adversely affected.
Art 28 – Application for Membership
 to be approved by the BODs
 In case of refusal or denial, an appeal may be
made to the general assembly (GA) and the
latter’s decision shall be final. The GA may
create an appeal and grievance committee to
decide on the case within 30 days upon receipt
of petition. Failure to address within 30 days,
the appeal is deemed approved in favor of the
applicant.

Art 29 – Liability
 A member shall be liable for the debts of the
coop to the extent of his/her contributions to
the share capital of the coop.
Art 30 – Termination of Membership:
 Withdrawal of membership
 The member shall be entitled to a refund of his
share capital and all other interests
 Death or insanity of a member
 Through a vote of the majority of all the
members of the BODs if:
 The member has not patronized any of the services
of the coop for an unreasonable period of time;
 a member has failed to comply with his obligations;
 a member has acted in violation of the bylaws and
the rules of the coop;
 a member has committed any act or omission
injurious or prejudicial to the interest or welfare of
the coop;
Procedure…
 The member will be informed of such
action and be given the opportunity to
be heard before the BODs makes its
decision.
 The decision of the BODs is appealable
to the GA within 30 days from the receipt
thereon.
 The GA has to make a final decision
within 30 days upon receipt of the
appeal. Failure to decide within this
period, the appeal is deemed approved
in favor of the member.
Art 31 – Refund of Interests

All sums computed in accordance with the

bylaws to be due from a coop to a former
member shall be paid to him either by the
coop or by the approved transferee…
Chapter IV – Administration
Art. 32 – Composition of the General Assembly (GA)

Composed of members who are entitled to vote

Art. 33 – Powers of the General Assembly

The highest policy-making body:

 Determine and approve amendments to the articles
of cooperation and by-laws;
 To elect and appoint the members of the BODs and
to remove them for cause
 To approve developmental plans of the coop
Art. 34 – Meetings
 Regular meeting is held annually on a date fixed
by the by-laws or if not, at any date within 90
days after the close of each fiscal year.
 Notice of meeting shall be sent in writing, by
posting or through other electronic means to all
members.

 Special meeting of the GA:

1. Majority vote of the BODs.
2. 10% of the total members will request the BOD
- The BOD to call for the GA
3. The CDA can order the BODs upon the petition of
10% of the total members.
Art. 35 – Quorum
 At least 25% of all the members entitled to vote

Art. 36 – Voting System

 Each member shall have only 1 vote.

Art. 37 – Composition and Term of the BODs

 Not less than five (5) not more than fifteen (15)
elected by the GA for a term fixed in the bylaws
but not exceeding a term of two (2) years.

Art. 38 – Powers of the BODs

 Strategic planning, direction-setting, and policy-
formulation activities of the coop.
Art. 39 – Directors
 Any member who has the right to vote
and who possesses all the qualifications
shall be eligible for election as director.
 The members of the BODs shall not hold
any other position directly involved in
the day to day operation and
management of the coop.
 Any person engaged in a business similar
to that of the coop or who in any way
has a conflict of interest with it, is
disqualified from election as a director of
said coop.
Art. 40 – Meeting of the BODs and Quorum
 Meeting shall be held at least once a month.
 Majority of the BODs constitute a quorum.
 Special meeting:
 Upon the request of the majority of the BODs

Art. 50 – Removal
 All complaints are to be filed with the BODs
 The officer shall be given the opportunity to be
heard.
 Majority of the BODs may place the officer
concerned under preventive suspension pending
the resolution of the investigation.
 The board shall present its recommendation for
removal to the GA. It takes ¾ votes of the
members present and constituting a quorum can
remove an officer.
 Chapter V –
Responsibilities, Rights
and Privileges of Coops
Art.51 – Address
Art 52 – Books to be Kept Open:
 Coop Code of the Philippines
 Regulations of the authority
 Article of Cooperation and bylaws of the coop
 Register of member
 Books of the minutes of meeting (BOD, GA)
 Share books, where applicable
 Financial Statements
Art 60-61 – Tax Treatment of Coops
 Coops which do not transact any business
with non-members or the general public
shall not be subject to any taxes and fees.
 Coops transacting business with both
members and non-members:
 Tax exemption when transactions are for the
members and if the accumulated reserves
and undivided net savings of the coop is not
more than 10M.
 Coops with net savings of more than 10M
shall pay taxes e.g. income tax, VAT.
Capital, Property, and Funds
Sources:
 Members’ share capital (not more than 10%
of the share capital of the coop).
 Loans and borrowing including deposits
 Revolving capital
 Subsidies, donations, legacies, grants etc.

If the member dies?

 His/her heir shall be entitled to the shares
of the decedent
Allocation and Distribution
of Net Surplus
 This is determined in the by-laws
 Order of distribution:
 Reserve Fund (stability of the coop and to meet net
losses in its operation) – at least 10% of net surplus
 Education and Training Fund (Education and Training
Purposes) – not more than 10% of the net surplus
 Community Development Fund (projects and
activities that will benefit the community) – not less
than 3% of the net surplus.
 Optional Fund (for land and building) – shall not
exceed 7%.
 Interest on share capital and patronage refund -