Republic of the PhilippinesCongress of the PhilippinesMetro ManilaFourteenth CongressSecond Regular SessionBegun and held in Metro Manila, on Monday, the twenty-eighth day of July, two thousand eight.Republic ct !o. "#$%February &', $%%"! C( M)!*+!, (-) C..P)R(+/) C.*) .F (-) P-+0+PP+!)S (. B) 1!.2! S (-) 3P-+0+PP+!) C..P)R(+/) C.*) .F $%%43Be it enacted by the Senate and -ouse of Representati5es of the Philippines in Congress asse6bled7Section &. rticles &, $, 8, 9 and # of Chapter & on ,eneral Concepts and Principles of Republic ct !o. :"84, otherwise ;nown as the3Cooperati5e Code of the Philippines,3 are hereby a6ended to read as follows7C-P()R +,)!)R0 C.!C)P(S !* PR+!C+P0)S3R(+C0) &. (itle. - (his ct shall be ;nown as the 3Philippine Cooperati5e Code of $%%43.3R(. $. *eclaration of Policy.- +t is the declared policy of the State to foster the creation and growth of cooperati5es as a practical 5ehicle for pro6oting self-reliance and harnessing people power towards the attain6ent of econo6ic de5elop6ent and social uired, patroni=ing their products and ser5ices and accepting a fair share of the ris;s and benefits of the underta;ing in accordance with uni5ersally accepted cooperati5e principles.3R(. 9. Cooperati5e Principles. - )5ery cooperati5e shall conduct its affairs in accordance with Filipino culture, good 5alues and e?perience and the uni5ersally accepted principles of cooperation which include, but are not li6ited to, the following7C-P()R ++.R,!+@(+.! !* R),+S(R(+.!3R(. :. Purposes of Cooperati5es.cooperati5e 6ay be organi=ed and registered for any or all of the following purposes73R(. '. .buoru6, resol5e to di5ide itself into the two A$B or 6ore cooperati5es. (he procedure for such di5ision shall be prescribed in the regulations of the uthority7 Pro5ided, (hat all the re>uire6ents set forth in this Code ha5e been co6plied with by the new cooperati5es7 Pro5ided, further, (hat no di5ision of a cooperati5e in fraud of creditors shall be 5alid.3R(. $&. Merger and Consolidation of Cooperati5es. A&B (wo A$B or 6ore cooperati5es 6ay 6erge into a single cooperati5e which shall either be one of the constituent cooperati5es or the consolidated cooperati5e.3R(. $$. )ffects of Merger and Consolidation. (he 6erger or consolidation of cooperati5es shall ha5e the following effects73R(. $8. (ype and Categories of Cooperati5es. A&B (ypes of Cooperati5es Cooperati5es 6ay fall under any of the following types73R(. $9. Functions of a Federation of Cooperati5es.federation of cooperati5es shall underta;e the following functions73R(. $#. Cooperati5e Enions. Registered cooperati5es and federations at the appropriate le5els 6ay organi=e or ualified, or until duly re6o5ed for caused.3R(. 84. Powers of the Board of *irectors. (he board of directors shall be responsible for the strategic planning, direction-setting and policy-for6ulation acti5ities of the cooperati5es.3R(. 8". *irectors. A&B ny 6e6ber of a cooperati5e who under the bylaws of the cooperati5e, has the right to 5ote and who possesses all the >ualifications and none of the dis>ualifications pro5ided in the laws or bylaws shall be eligible for election as director.3R(. 9%. Meeting of the Board and Guoru6 Re>uire6ent. A&B +n the case of pri6ary cooperati5es, regular 6eetings of the board of directors shall be held at least once a 6onth.3R(. 9&. /acancy in the Board of *irectors. ny 5acancy in the board of directors, other than by e?piration of ter6, 6ay be filled by the 5ote of at least a 6auoru6C otherwise, the 5acancy 6ust be filled by the general asse6bly in a regular or special 6eeting called for the purpose.director so elected to fill a 5acancy shall ser5e only the une?pired ter6 of his predecessor in office.3R(. 9$. .fficers of the Cooperati5e. (he board of directors shall elect fro6 a6ong the6sel5es the chairperson and 5ice-chairperson, and elect or appoint other officers of the cooperati5e fro6 outside of the board in accordance with their bylaws. ll officers shall ser5e during good beha5ior and shall not be re6o5ed e?cept for cause after due hearing. 0oss of confidence shall not be a 5alid ground for re6o5al unless e5idenced by acts or o6ission causing loss of confidence in the honesty and integrity of such officer. !o two A$B or 6ore persons with relationships up to the third ci5il degree of consanguinity or affinity nor shall any person engaged in a business si6ilar to that of the cooperati5e nor who in any other 6anner has interests in conflict with the cooperati5e shallser5e as an appointi5e officer.3R(. 98. Co66ittees of Cooperati5es. A&B (he bylaws 6ay create an e?ecuti5e co66ittee to be appointed by the board of directors with such powers and duties as 6ay be delegated to it in the bylaws or by a 6auire6ents of *irectors, .fficers and Co66ittee Me6bers. the functions and responsibilities of directors, officers and co66ittee 6e6bers, as well as their training re>uire6ents, shall be in accordance with the rules and regulations issued by the uthority.3R(. 9#. 0iability of *irectors, .fficers and Co66ittee Me6bers. *irectors, officers and co66ittee 6e6bers, who are willfully and;nowingly 5ote for or assent to patently unlawful acts or who are guilty of gross negligence or bad faith in directing the affairs of the cooperati5e or ac>uire any personal or pecuniary interest in conflict with their duty as such directors, officers or co66ittee 6e6bers shall be liable uired and held, by such 6e6ber through the proceeds of the loan or credit granted by the cooperati5e to hi6 for as long as the sa6e is not fully paid.3R(. #". Pri6ary 0ien. - !otwithstanding the pro5ision of any law with the contrary, a cooperati5e shall ha5e pri6ary lien upon the capital, deposits or interest of a 6e6ber for any debt due to the cooperati5e fro6 such a 6e6ber.3R(. :%. (a? (reat6ent of Cooperati5e. - *uly registered cooperati5es under this Code which do not transact any business with non-6e6bers or the general public shall not be subuip6ent to such agrarian refor6 cooperati5es.3R(. "&. 0ease of Public 0ands. (he ,o5ern6ent 6ay lease public lands to any agrarian refor6 cooperati5e for a period not e?ceeding twenty-fi5e A$#HB years, subuire6ents on capitali=ation, in5est6ents and reser5es of insurance fir6s 6ay be liberally 6odified upon consultation with the uthority and the cooperati5e sector, but in no case 6ay be re>uire6ent to be reduced to less than half of those pro5ided for under the +nsurance Code and other related laws.3R(. &%4. +6ple6enting Rules. (he +nsurance Co66ission and the uthority, in consultation with the concerned cooperati5e sector, shall issue the appropriate rules and regulations i6ple6enting the pro5isions of this Chapter.3C-P()R J+/PEB0+C S)R/+C) C..P)R(+/)S3R(. &%". *efinition and Co5erage.public ser5ice cooperati5e, within the 6eaning of this Code, is one organi=ed to render public ser5ices as authori=ed under a franchise or certificate of public con5enience and necessity duly issued by the appropriate go5ern6ent agency. Such ser5ices 6ay include the following73R(. &&%. Registration Re>uire6ents. Enless otherwise pro5ided in this Code, no public ser5ice cooperati5e shall be registered unless it satisfies the following re>uire6ents.3R(. &&&. Regulation of Public Ser5ice Cooperati5es. A&B (he internal affairs of public ser5ice cooperati5es such as the rights and pri5ileges of 6e6bers, the rules and procedures for 6eetings of the general asse6bly, board of directors and co66itteesC for the election and >ualifications of officers, directors, and co66ittee 6e6bersC allocation and distribution of surplusesC and all other 6atters relating to their internal affairs shall be go5erned by this Code.3R(. &&$. )ngage6ent in llied Business by (ransportation Ser5ice Cooperati5es. Subuired public transportation ser5ices.3(he uthority, in consultation with the concerned go5ern6ent agencies and cooperati5e sector, shall issue appropriate rules and regulations pertaining to the pro5isions of this Chapter.3C-P()R J/CR)*+( C..P)R(+/)S3R(. &&9. Co5erage. (his Chapter shall apply to credit cooperati5es and other cooperati5es, including 6ultipurpose cooperati5es, that pro5ide sa5ings and credit to their 6e6bers only. (he rest of the pro5isions of this Code shall apply to the6 insofar as the sa6e are not inconsistent with the pro5isions of this Chapter.3R(. &. *efinition and .buire6ent for Registration. +n co6pliance with the referendu6 as a 5oting procedure, the re>uired nu6ber of 5otes for registration with the uthority shall be twenty percent A$%HB of all 6e6bers in good standing.3R(. &$". *ocu6ents to be Sub6itted for Registration with the uthority. For purposes of registration, electric cooperati5es shall sub6it the following docu6ents73R(. &8%. Registration .ptions of )lectric Cooperati5es. )lectric Cooperati5es registered with the !ational )lectrification d6inistration A!)B under Presidential *ecree !o. $:", as a6ended which opt not to register with the uthority are allowed to retain the word 3cooperati5e3 in their registered na6es7 Pro5ided, (hat they shall not be entitled to the benefits and pri5ileges under this Code.3R(. &8&. Role of the )nergy Regulatory Co66ission. ll rates and tariffs of electric cooperati5es registered under the uthority shall be subualification.3R(. &9&. Printing and *istribution. A&B (he !ational Printing .ffice shall publish this Code in the .fficial ,a=ette in full within si?ty A:%B days fro6 the date of appro5al thereof. Copies of this Code shall be gi5en to e5ery depart6ent, agency and instru6entality of the !ational ,o5ern6ent, including regional, pro5incial offices and local go5ern6ents including go5ern6ent-owned and controlledcorporations.3R(. &9$. +nterpretation and Construction. +n case of doubt as to the 6eaning of any pro5ision of his Code or the regulations issued in pursuance thereof, the sa6e shall be resol5ed liberally in fa5or of the cooperati5es and their 6e6bers.3R(. &98. Repealing Clause. )?cept as e?pressly pro5ided by this Code, Presidential *ecree !o. &'# and all other laws, or parts thereof, inconsistent with any pro5ision of this Code shall be dee6ed repealed7 Pro5ided, (hat the pro5isions of Sec.s 8, #, and ' of Presidential *ecree !o. &:9#, )?ecuti5e .rder !o. :$8, series of $%%'. Re5enue Regulation !o. $%-$%%&, and all laws, decrees, e?ecuti5e orders, i6ple6enting rules and regulations, B+R circulars, 6e6orandu6 orders, letters of instruction, local go5ern6ent ordinances, or parts thereof inconsistent with any of the pro5isions of this ct are hereby repealed, a6ended or 6odified accordingly.3R(.&99. (ransitory Pro5isions.- A&B ll cooperati5es registered and confir6ed with the uthority under Republic ct !o. :"84 and Republic ct !o. :"8", are hereby dee6ed registered under this code, and a new certificate of registration shall be issued by the authority7 Pro5ided, (hat such cooperati5e shall sub6it to the nearest office of the authority a copy of their certificate of registration or certificate of confir6ation, the articles of cooperation, their bylaws, and their latest audited financial state6ent within one A&B year fro6 the effecti5ity of this code, otherwise the shall be dee6ed cancelled 6otu proprio.3R(.&9#. Separabilty Clause. - Should any part of this code be declared unconstitutional, the 5alidity of re6aining pro5ision hereof shall re6ain in full and effect.3R(.&9:. )ffecti5ity Clause. - (his code shall ta;e effect fifteen AB days fro6 its publication in a newspaper of general circulation. COOPERATIVE A3coop3B or co-operati5e A3co-op3B is an autono6ous association of persons who 5oluntarily cooperatefor their 6utual social, econo6ic, and cultural benefit. Cooperati5es include non-profit co66unity organi=ations and businesses thatare owned and 6anaged by the people who use its ser5ices Aa consu6er cooperati5eB or by the people who wor; there Aa wor;ercooperati5eB or by the people who li5e there Aa housing cooperati5eB, hybrids such as wor;er cooperati5es that are also consu6ercooperati5es or credit unions, 6ulti-sta;eholder cooperati5es such as those that bring together ci5il society and local actors to deli5erco66unity needs, and second and third tier cooperati5es whose 6e6bers are other cooperati5es.THE TYPES OF COOPERATIVES IN THE PHILIPPINES ARE AS FOLLOWS:aB Credit Cooperative K is one that pro6otes and underta;es sa5ings and lending ser5ices a6ong its 6e6bers. +t generates a co66onpool of funds in order to pro5ide financial assistance and other related financial ser5ices to its 6e6bers for producti5e and pro5ident purposesCbB Consumers Cooperative K is one the pri6ary purpose of which is to procure and distribute co66odities to 6e6bers and non-6e6bersCcB Produ!ers Cooperative K is one that underta;es a