QuestionsQuestions (CDA MEMORANDUM CIRCULAR NO. 2011-18)
It is issued pursuant to Republic Act No. 6939, which authorizes the Cooperative Development Authority to promulgate rules and guidelines for cooperatives.
A federation is a cooperative whose members are primary cooperatives doing the same line of business.
Primary cooperative: members are natural persons. Secondary cooperative: members are primary cooperatives.
A tertiary cooperative is a cooperative whose members are secondaries.
A union is a cooperative whose members are registered cooperatives and/or federations organized to represent the interests and welfare of all types of cooperatives at the provincial/city/regional/national levels.
They cover all federations and unions applying for registration with the CDA except those covered by Chapters XII, XIII, and XVI & XVII of RA 9520.
Secondary federation: 3 primary cooperatives. Tertiary federation: 3 secondary cooperatives.
Secondary union: 15 primary cooperatives. Tertiary union: 15 secondary cooperatives.
Secondary federation: PHP 500,000.00. Tertiary federation: PHP 5,000,000.00 or the feasibility study requirement whichever is higher (and in no case less than the stated minimum).
The table indicates “None” for union paid-up share capital requirements.
It may be organized at municipal/city, district, provincial, regional, or national levels, but members must be doing the same line of business activity.
A federation can engage in cooperative enterprises under Article 6 of RA 9520 that complement, augment, or supplement but must not conflict with, compete with, or supplant the business or economic activities of its members. A union focuses on advocacy for member welfare and advancement of interests (not competing/supplanting).
Accountable officer/s must be covered by sufficient surety bond, with the bond amount depending primarily on the amount of accountabilities handled by the officers as determined by the Board of Directors.
It is one tenth (1/10) of one percent (1%) of the authorized share capital or the amounts prescribed in the CDA schedule of fees, whichever is higher, payable on or before issuance of the Certificate of Registration.
For federations: submit four (4) copies of the Feasibility Study containing specified items (organizational structure, purposes/objectives, area of operation, number of members/potential members, feasibility technical/management/financial including 3-year projections and subsidies, and provision for cooperative education/training). For cooperative unions: the feasibility study can be replaced by a three-year development plan.
It must incorporate a provision specifying cooperative education and training programs.
A duly notarized affidavit attached to the Articles of Cooperation stating the total amount received from members’ share capital contributions, membership fees, donations, or subsidies.
Examples include: (1) BOD Resolution on authorized representative; (2) certification of the chairperson of member primaries stating the line of business activity and compliance with CDA-prescribed accounting/auditing standards; and (3) other documents as may be required by the Authority.
It becomes effective fifteen days upon approval by the Board of Administrators and registration with the Office of the National Administrative Register (ONAR).