QuestionsQuestions (CDA MEMORANDUM CIRCULAR NO. 2010-08)
It is based on Par. 1, Art. 144 of Republic Act No. 9520, particularly the rule that cooperatives previously registered/confirmed under RA 6938 and RA 6939 are deemed registered under the Code, but must submit required documents within one (1) year from the effectivity of RA 9520; otherwise, they are deemed cancelled motu proprio.
All existing cooperatives previously registered and confirmed with the Authority under RA 6938 and RA 6939 that failed to comply with the requirements under Art. 144 of RA 9520 as implemented by CDA MC No. 2009-02 series of 2009.
The Extension Office of the Authority has primary jurisdiction over cooperatives within its region.
CDA Central Office has primary jurisdiction over tertiary cooperatives, cooperative banks, electric cooperatives, and insurance cooperatives.
Within thirty (30) days from receipt of the Order of Cancellation, the cancelled cooperative is obliged to liquidate its assets and liabilities following/adopting the liquidation procedures under the Guidelines, unless otherwise agreed upon by the members.
The Panel of Liquidators shall come from the former officers and/or members of the cooperative and must not be less than three (3) nor more than five (5) members.
Yes. They may receive a reasonable honorarium, paid out of the funds of the cooperative.
They must: (1) notify the Authority of assumption and commencement; (2) make inventory of assets and determine liabilities including share capital holdings; (3) preserve existing assets; (4) convert assets into cash; (5) pay outstanding obligations/valid claims; (6) distribute remaining assets per the Guidelines; and (7) submit a final report to the Authority.
Payment of creditors shall follow the contract basis and the New Civil Code rules on preference and concurrence of credits.
All statutory and other funds established by the cancelled cooperative shall be disposed of in accordance with Article 86 of the Code.
They are subject to escheat, as stated under the Guidelines: subsidies, donations, legacies, grants, aids, and other assistance from any local or foreign institutions (public or private) are subject to escheat.
Remaining assets are distributed by the Panel of Liquidators to members in payment of their respective share capital. If remaining assets are insufficient to fully pay members’ share capital contributions, distribution is in proportion to their share capital.
They are given to the federation/union to which the cancelled cooperative is affiliated for cooperative development; if there is no affiliation, to the Local Government Unit (LGU) of their choice. If no affiliation exists, the undistributed assets go to the community where the cooperative operated.
The final report must cover: assets sold; assets written off as worthless; assets donated; expenses of liquidation; payment of liabilities; settlement of reserves; refund of share capital contributions and other interest to members; and other important matters.
Members and other parties in interest may file either civil or criminal actions against the officers of the cooperative prior to its cancellation, in the appropriate Courts of Justice, to recover their interests.
They take effect fifteen (15) days after publication with the Official Gazette or in a newspaper of general circulation.
First, after the cooperative receives the formal notice, the Authority issues the Order of Cancellation after 30 days. Second, after receipt of the Order of Cancellation, the cooperative (through its Panel of Liquidators) must begin/complete liquidation following the procedures within 30 days.