Question & AnswerQ&A (Republic Act No. 9520)
The Act shall be known as the Philippine Cooperative Code of 2008.
The State declares it policy to foster the creation and growth of cooperatives as vehicles for promoting self-reliance, economic development, and social justice, encouraging private sector formation and ensuring government support without infringing cooperative autonomy.
A cooperative is an autonomous and duly registered association of persons with a common bond of interest who voluntarily join to achieve social, economic, and cultural needs by making equitable contributions to capital, patronizing products and services, and sharing risks and benefits according to cooperative principles.
1. Voluntary and Open Membership, 2. Democratic Member Control, 3. Member Economic Participation.
Members include natural or juridical persons who adhere to cooperative principles and are admitted according to the cooperative's articles of cooperation.
At least fifteen (15) natural Filipino citizens of legal age with a common bond of interest residing or working in the area of operation may organize a primary cooperative after completing a pre-membership education seminar.
A member shall be liable for the cooperative's debts only to the extent of his contribution to the share capital.
Determining and approving amendments to articles of cooperation and bylaws, electing or appointing board members and removing them for cause, and approving developmental plans of the cooperative.
Individuals or officers of organizations using the word 'cooperative' without registration shall be penalized with imprisonment of 2 to 5 years and/or a fine not exceeding P20,000.
A petition signed by majority of the board and approved by three-fourths (3/4) of members with voting rights must be filed with the Authority, followed by publication of notice, a hearing, and order of dissolution by the Authority if justified.
No member other than the cooperative itself may own more than 10% of the share capital. Heirs receiving shares must also comply with this limit, and shares exceeding this ownership limit revert to the cooperative.
At least 10% to reserve fund (50% in first five years), up to 10% for education and training fund, not less than 3% for community development fund, optional funds not exceeding 7%, and the remaining surplus distributed as interest on share capital and patronage refunds.
Violation of any law, regulation, or bylaw provisions; or insolvency as determined by a competent court after due hearing.
The Bangko Sentral ng Pilipinas (BSP) supervises cooperative banks registered under the Code.
Disputes should be settled amicably through conciliation or mediation mechanisms set in the bylaws; if these fail, voluntary arbitration is the exclusive mode of dispute resolution.
The auditor must be independent from the cooperative and be a member in good standing of the Philippine Institute of Certified Public Accountants (PICPA), accredited by the Board of Accountancy and the Authority.
Regular members entitled to full rights and privileges, and associate members who have limited rights and no voting privileges.
For reasons including non-patronage for an unreasonable period, violation of bylaws or rules, any act prejudicial to cooperative interests, or death/insanity/insolvency under specified conditions.
Copies of the Code and related laws, regulations, articles of cooperation, bylaws, member registers, minutes of meetings, share books, financial statements, and other prescribed documents.
Fifty (50) years from the date of registration, extendable in increments not exceeding fifty (50) years each by amendment of articles of cooperation.