Cooperative Development Authority Charter of 2019

Policy, purpose, and constitutional mandate

The State promotes the viability and growth of cooperatives as instruments of equity, social justice and economic development (Section 2).
The State creates an agency to fulfill the mandate in Section 15, Article XII of the 1987 Constitution (Section 2).
Cooperatives are recognized as associations organized for the economic and social betterment of their members, operating business enterprises based on mutual aid, and founded upon internationally accepted cooperative principles and practices (Section 2).
The Cooperative Development Authority (CDA) is recognized as primarily responsible for the institutional development and regulation of cooperatives through partnership with the cooperative sectors and the academe (Section 2).
Cooperatives have the right to initiate and foster within their own ranks cooperative promotion, organization, training, information gathering, audit and support services, with government assistance where necessary (Section 2).
The NEDA and the DTI must include the promotion of growth and expansion of cooperatives as major and indispensable components of national development plans (Section 2).
The DOF and the DBM must provide the mechanism to ensure availability of resources to implement such plans (Section 2).
The government and all its branches, subdivisions, instrumentalities and agencies must continue providing technical guidance, financial assistance and other services to enable cooperatives to develop into viable and responsive economic enterprises toward a strong cooperative movement, free from conditions that infringe cooperative objectives and character (Section 2).
The State maintains the policy of noninterference in the management and operations of cooperatives, except as provided in Republic Act No. 11364 (Section 2).

Strengthening and structure of CDA

The CDA created under Republic Act No. 6939 is strengthened and reorganized to carry out Republic Act No. 11364 and Republic Act No. 6938, as amended by Republic Act No. 9520, known as the “Philippine Cooperative Code of 2008” (Section 3).
The Authority has its head office in the National Capital Region (NCR) and maintains the existing sixteen (16) extension offices (Section 3).
In NCR, extension offices comprise field district offices, and the Authority maintains offices and branches in other places as required for proper conduct of its business (Section 3).
The Authority is an agency attached to the DTI for policy and program coordination for cooperatives (Section 3).

Authority powers, regulation, and disputes

The Authority develops and formulates regulations, standards, rules, orders, guidelines and/or circulars to implement Republic Act No. 11364 and Republic Act No. 9520 for effective and sound cooperative operations (Section 4(a)).
The Authority formulates, adopts and implements integrated and comprehensive plans and programs on cooperative development consistent with national policy on cooperatives and establishes an integrated framework for all government agencies (Section 4(b)).
The Authority registers all cooperatives, including amendments to the Articles of Cooperation and Bylaws (ACBL), and also registers division, merger, and consolidation (Section 4(c)).
The Authority authorizes the establishment of branches and satellite offices of cooperatives (Section 4(d)).
The Authority issues a Certificate of Recognition to organized Laboratory Cooperatives (Section 4(e)).
The Authority exercises supervision and jurisdiction over all types and categories of cooperatives registered with it (Section 4(f)).
The Authority requires submission of annual reports, audited financial statements, and other reports in forms it prescribes to comply with Republic Act No. 9520 (Section 4(g)).
The Authority creates an information system from reports and other documents submitted by cooperatives (Section 4(h)).
The Authority promulgates and issues guidelines on the specific use and utilization of statutory funds and obligations to achieve the real intent and spirit of establishing such funds and obligations for the benefit of cooperatives and communities served (Section 4(i)).
The Authority prescribes and collects reasonable fees, fines or charges in performing its registration and regulatory functions (Section 4(j)).
The Authority requires registered cooperatives to develop business continuity plans to address all kinds of risks (Section 4(k)).
The Authority grants awards, recognition and incentives to cooperatives, cooperative leaders and partners (Section 4(l)).
The Authority administers all grants and donations exclusively intended for cooperatives coursed through the Authority for cooperative development, without prejudice to cooperatives’ right to directly receive and administer such grants and donations upon agreement with grantors and donors (Section 4(m)).
The Authority conducts regular inspection or examination of a cooperative under its rules and regulations, and when necessary conducts examination and investigation to protect members’ interests and welfare and the general public (Section 4(n)).
Cooperative federations, unions, LGUs, cooperative development offices (CDOs), cooperative federations and unions, and an alliance of cooperatives functioning as the consultative and coordinating body may be requested to assist in inspection and examination (Section 4(n)).
The Authority conducts management and training programs to develop members’ entrepreneurial capabilities, managerial expertise, and technical skills, inculcate the true spirit of cooperativism, and provide technical and professional assistance when necessary, with special concern for agrarian reform, agriculture, fishery and economically depressed sectors (Section 4(o)).
The Authority conducts investigations, files necessary charges, disciplines, suspends and/or removes erring officers and members for violations of cooperative laws, rules, regulations, Authority issuances, and the AGBL, after due process, and directs the general assembly to replace suspended/removed officers in accordance with rules and regulations it promulgates (Section 4(p)).
After due notice and hearing for noncompliance with lawful orders, rules and regulations of the Authority (including the cooperative’s ACBIL under the implementing rules and regulations), the Authority may order the suspension or cancellation of the cooperative’s Certificate of Registration and/or revocation of a Letter of Authority and/or Certificate of Authority for satellite or branch offices (Section 4(q)).
The Authority may order the dissolution and liquidation of cooperatives and the transfer of all or substantially all assets and liabilities (Section 4(r)).
The Authority may compel cooperatives to call a general or representative assembly under its supervision with participation of their respective cooperative federations or unions, subject to criteria or conditions defined in the IRR (Section 4(s)).
The Authority hears and decides inter-cooperative and intra-cooperative disputes, controversies and/or conflicts without prejudice to filing civil and/or criminal cases in regular courts (Section 4(t)).
All decisions of the Authority are appealable directly to the Court of Appeals (Section 4(t)).
The Authority adopts and implements a dispute resolution mechanism to settle conflicts between and among members, officers, and directors of cooperatives, and between and among cooperatives consistent with Article 137 of Republic Act No. 9520 and the Alternative Dispute Resolution Act of 2004 (Republic Act No. 9285) (Section 4(u)).
For election-related issues, the aggrieved party may elevate the case for adjudication to the Authority without undergoing alternative dispute resolution (Section 4(u)).
The Authority issues cease and desist orders to cooperatives and responsible parties specified under Article 137 of Republic Act No. 9520, and issues other orders and notices to preserve cooperative assets and documents subject of dispute or litigation (Section 4(v)).
The Authority may issue subpoena ad testificandum and subpoena duces tecum to require parties to appear and produce documents in proceedings of the Authority, and may order examination of documents, papers, files and records of any cooperative or person under investigation as necessary for proper disposition of cases (Section 4(w)).
The Authority may cite for contempt any person guilty of misconduct in the presence of the Authority that seriously interrupts any hearing or inquiry, imposing a fine of not more than PHP 5,000.00 or imprisonment of not more than ten (10) days, or both (Section 4(x)).
Indirect contempt acts are punished in accordance with Rule 71 of the Rules of Court (Section 4(x)).
The Authority implements and enforces decisions and orders with assistance of deputized law enforcement agencies or the concerned LGU as necessary (Section 4(y)).
The Authority recognizes sectoral apex organizations and a national alliance representing all types and categories of cooperatives as the overall consultative and coordinating body, and it issues necessary IRR for this provision (Section 4(z)).
The Authority establishes a consultative mechanism consistent with Section 18 to ensure cooperative sector participation on matters concerning government plans, programs, and policies affecting cooperatives (Section 4(aa)).
The Authority coordinates with provincial, city, or municipal cooperative offices to adopt and implement national plans, programs and policies on cooperative development and establishes partnership in promoting, organizing, and developing cooperatives within LGU jurisdiction (Section 4(bb)).
The Authority establishes cooperative development councils at the national, regional, provincial, city and municipal levels to provide policy consultation and program coordination, guided by rules it prescribes (Section 4(cc)).
The Authority collaborates with concerned agencies providing technical, professional and marketing assistance including trainings on transfer of technology to ensure viability, growth, competitiveness and innovativeness of cooperatives with special concern for agrarian reform, agriculture and fishery and economically depressed sectors (Section 4(dd)).
The Authority provides assistance on cooperative product development and facilitates marketing in domestic and international markets in coordination with concerned agencies (Section 4(ee)).
The Authority designates a representative in the Regional Development Council (RDC) and its sectoral committees as a regular voting member (Section 4(ff)).
The Authority establishes linkages with the academe and other institutions local and international for education, training and research for cooperatives (Section 4(gg)).
The Authority formulates, adopts and implements an educational and technological exchange program at domestic or international levels (Section 4(hh)).
The Authority formulates, adopts and implements a standard of training for cooperative officers or members consistent with Section 17, focusing on basic cooperative principles and values, good governance, business and entrepreneurial management, human resource management, risk management, conflict management, and technical skills required for efficient and effective operations (Section 4(ii)).
The Authority establishes and maintains a continuing educational and capability building program for the Authority (Section 4(jj)).
The Authority exercises other powers and functions necessary to implement Republic Act No. 11364 and Republic Act No. 9520 (Section 4(kk)).

Board composition and governance

The Authority has a Board of Directors as its collegial policy-making body (Section 5).
The Board consists of a Chairperson (rank and privilege of an Undersecretary) and six (6) Members (rank and privilege of an Assistant Secretary), all appointed by the President and chosen among nominees from the cooperative sector (Section 5).
One (1) board director represents each cluster of cooperatives:
- (a) Credit and Financial Services, Banking, and Insurance
- (b) Consumers, Marketing, Producers, and Logistics
- (c) Human Services: Health, Housing, Workers, and Labor Service
- (d) Education and Advocacy
- (e) Agriculture, Agrarian, Aquaculture, Farmers, Dairy, and Fisherfolk
- (d) Public Utilities: Electricity, Water, Communications, and Transport (Section 5).
The Secretary of the DTI and the Secretary of the Department of the Inferior and Local Government (DILG) serve as ex officio members and may designate a permanent alternate with rank of at least Assistant Secretary whose acts are treated as those of the principal (Section 5).
The law requires at least one (1) lawyer member of the Board as far as practicable and requires gender balance in Board membership (Section 5).
The Board formulates policies and rules consistent with Republic Act No. 9520 and Republic Act No. 11364, and adopts an IER for internal operations of the Authority (Section 6(a)-(b)).
The Board organizes the operating structure, approves the Authority’s work and financial plan, and approves annual, medium-term and long-term cooperative development plans consistent with national socioeconomic development policy (Section 6(c)-(e)).
The Board provides overall direction defining roles of NGAs, LGUs, people’s organizations, private sector and NGOs in promoting and developing the cooperative sector (Section 6(f)).
The Board conducts regular policy consultations with the cooperative sector, government agencies, LGUs, people’s organizations, private sector, NGOs and other stakeholders on Authority policies, programs and initiatives (Section 6(g)).
The Board decides cases submitted to it for resolution (Section 6(h)).
The Board authorizes the Chairperson or the Administrator to enter into contracts or agreements on behalf of the Authority (Section 6(i)).
The Board approves and submits the annual proposed budget of the Authority to the President through the DBM (Section 6(j)).
The Board formulates implementing rules and exercises other powers required to implement the objectives of the Act (Section 6(k)).

Qualifications, conflicts, and terms

The Chairperson and Board Members must be natural-born Filipino citizens (Section 7(a)).
They must hold any bachelor’s degree (Section 7(b)).
They must have five (5) years experience as an officer of a cooperative in the cluster they represent (Section 7(c)).
They must be residents of the Philippines for at least five (5) years prior to appointment (Section 7(d)).
Upon appointment, the Chairperson and any Board Member must divest direct or indirect pecuniary interest or dealings with any cooperative (Section 7).
The Chairperson and Board Members serve a term of six (6) years without reappointment (Section 8).
If a Chairperson or Member served the unfinished term of the one they succeeded and served less than one-half (1/2) of the full term, they are eligible for reappointment (Section 8).
The Chairperson and Members may be removed from office for cause (Section 9).
The person appointed for the unexpired term is eligible for reappointment if the unexpired term is less than one-half (1/2) of the prescribed term (Section 9).

Board meetings and administrator system

The Board must meet at least once a month for regular business (Section 10).
Special meetings may be called by the Chairperson or by a majority of Board Members under exceptional circumstances to decide urgent matters (Section 10).
Decisions require a majority vote by the entire Board (Section 10).
The Chairperson presides; if absent, the most senior member in terms of appointment presides as Acting Presiding Officer; if absent, the Board elects an Acting Presiding Officer among themselves (Section 10).
Board regular and special meetings are held at the Authority head office or at another place determined by the Board (Section 10).
The Authority has an Administrator appointed by the President, recommended by the Board, with rank of an Assistant Secretary (Section 11).
The Administrator executes and administers Board-approved policies, decisions, orders and resolutions, and provides general executive direction and supervision of the Authority (Section 11).
The Board appoints five (5) Deputy Administrators, who assist the Administrator and are assigned to:
(a) General Administration and Support Services;
(b) Institutional Development;
(c) Legal Affairs;
(d) Registration, Supervision and Examination; and
(e) Credit Surety Fund (CSF) (Section 11).
The Administrator must be a natural-born Filipino citizen (Section 12(a)).
The Administrator must hold any bachelor’s degree (Section 12(b)).
The Administrator must possess the necessary civil service eligibility (Section 12(c)).
The Administrator must have five (5) years experience as an officer of a cooperative or as an official/employee in a government office or NGO dealing with cooperatives (Section 12(d)).
Upon appointment, the Administrator must divest direct or indirect pecuniary interest or dealings with any cooperative (Section 12).
The Administrator prepares and consolidates periodic reports for Board consideration (Section 13(a)).
The Administrator implements a human resource management system consistent with existing civil service laws to promote professionalism and excellence (Section 13(b)).
The Administrator prepares the proposed annual and supplemental budget for Board approval (Section 13(c)).
The Administrator submits annual reports to the President of the Philippines and Congress on performance and accomplishments of the Authority (Section 13(d)).
The Administrator appoints personnel lower than Deputy Administrator positions (Section 13(e)).
The Administrator represents the Authority in all undertakings and where required (Section 13(f)).
The Administrator performs other functions required by law (Section 13(g)).

Registration, tax exemption, and cooperative word ban

The Authority furnishes the Bureau of Internal Revenue (BIR), LGUs (provinces, highly-urbanized and independent cities) and other concerned agencies a certified list of duly registered cooperatives for processing tax exemptions (Section 14).
Any public official or employee who violates or circumvents the certified list requirement is dealt with under Article 140 of Republic Act No. 9520 (Section 14).
The use by any person or organization of the word “cooperative,” “coop,” “co-op” and “koop” in their business name is prohibited unless duly registered with the Authority, except as provided under Article 130 of Republic Act No. 9520 (Section 15).
Violations are penalized under Article 140 of Republic Act No. 9520 (Section 15).

Settlement, training, partnership, education

Disputes between and among members, officers and directors of cooperatives and between and among cooperatives are settled, as far as practicable, under Article 137 of Republic Act No. 9520, Republic Act No. 9285, and Section 4(u) of Republic Act No. 11364 (Section 16).
The Authority, in partnership with learning and training institutions with the cooperative sector, formulates standards of training requirements for cooperative officers and members to ensure compliance (Section 17).
The Authority may accredit organizations other than cooperatives, duly registered under Philippine laws and engaged in cooperative promotion, organization, research and education, as nonacademic training institutions (Section 17).
Upon request of cooperatives, state universities and colleges (SUCs) provide technical assistance and guidance to cooperatives in their communities (Section 17).
SUCs may engage the support and participation of unions and federations of cooperatives in implementing SUC technical assistance (Section 17).
A strong partnership between the Authority, the cooperative sector and the academe must be established to implement the Authority’s developmental functions under Section 4 and the training standards under Section 17 (Section 18(a)).
The Authority, the cooperative sector, and the academe formulate guidelines for implementing the partnership to enable recognition of apex organizations and a national alliance that function as the overall consultative and coordinating body with the Authority (Section 18(b)).
The Authority recognizes cooperative unions and federations under Articles 24 and 25 of Republic Act No. 9520 and issues guidelines to promote and develop these secondary cooperatives (Section 18(c)).
Cooperative history, philosophy, concepts, values, principles and practices and their role in nation building must be part of the curriculum of both formal and nonformal education (Section 19).
Cooperativism as a tool for self-empowerment and nation building must be included in the curricula of senior students in all secondary educational institutions and in the syllabus of any social and civic studies subject in the K to 12 level (Section 19).
Cooperatives development and administration may be offered as a field of study in baccalaureate, post baccalaureate and masteral programs in SUCs (Section 19).
SUCs may offer courses using a nontraditional approach under the equivalency program of SUCs that accredits the equivalent training that an officer has undertaken to the relevant subject in the curriculum (Section 19).
If SUCs do not offer a separate academic program in cooperative development and administration, SUCs must include a three (3)-unit subject in curricula of accountancy, agribusiness, agriculture, agricultural economics, business, community development, economics, education, environmental sciences, social sciences, political economy and other curricula instrumental in cooperative development (Section 19).

Priority sectors and special cooperative concerns

The Authority makes priority programs for the promotion and development of agricultural, agrarian and aquaculture cooperatives, including farmers, dairy and fisherfolk, in coordination with the Department of Agriculture (DA) and its attached agencies and GOCCs, Department of Agrarian Reform (DAR), National Commission on Indigenous Peoples (NCIP) and other government agencies to ensure food security and reduce rural poverty (Section 20).
The promotion and development of cooperative banks as part of the banking system and financial service cooperatives (as defined in Republic Act No. 9520) is a special concern of the Authority, implemented through necessary programs in collaboration with the Bangko Sentral ng Pilipinas (BSP) and the cooperative sector concerned (Section 21).
Registered cooperatives must secure necessary licenses, franchises, certificates of authority and permits from other agencies with jurisdiction over their activities if required by other existing laws, rules and regulations (Section 22).

Reorganization, transitory measures, and budgets

The Authority must be reorganized within one hundred twenty (120) days from the effectivity of the Act in accordance with Republic Act No. 6656 (Section 23).
Upon effectivity, Authority personnel continue performing duties and responsibilities unless removed for cause and after due process, without diminution of rank, salaries and other emoluments (Section 24).
The CDA created under Republic Act No. 6939 is reorganized; its employees are absorbed in the Authority created under Republic Act No. 11364 in accordance with its staffing pattern, subject to civil service laws, rules and regulations and DBM rules and regulations (Section 24).
Those who opt to retire or separate voluntarily are given separation pay computed based on DBM guidelines and regulations (Section 24).
The incumbent Chairperson and Administrators of the CDA continue to serve and act as Chairperson and Members of the Board until the new composition is constituted (Section 24).
The Authority collects existing accounts receivable from transfer of funds from the DA under Presidential Decree No. 175, as amended, and other funds coursed through the Authority, or enters into compromise agreements or condonation of such accounts, subject to Authority rules and regulations and the Commission on Audit (COA) (Section 24).
All assets and liabilities of the current CDA and unexpended appropriations are transferred to the Authority (Section 24).
Amounts necessary to implement the Act are charged against the current year’s budget of the CDA, and thereafter included in the annual General Appropriations Act (Section 25).

Implementing rules, information campaign, oversight

The Board must formulate the IRR within ninety (90) days from the effectivity of the Act in consultation with the cooperative sector and other concerned government agencies (Section 26).
The IRR takes effect fifteen (15) days after publication in the Official Gazette or in two (2) newspapers of general circulation (Section 26).
Subsequent amendments to the IRR must also be published before taking effect (Section 26).
The Authority must conduct a massive information campaign on the provisions of the Act upon its effectivity (Section 27).
The Joint Congressional Oversight Committee on Cooperatives (JCOCC) created under Article 138 of Republic Act No. 9520 reviews and monitors implementation of Republic Act No. 11364 (Section 28).

Repeal, separability, and effectivity

Republic Act No. 6939 is repealed, which previously created the “Cooperative Development Authority,” and laws, decrees, executive orders, rules and regulations or parts inconsistent with Republic Act No. 11364 are amended or modified accordingly (Section 29).
If any part of the Act is declared unconstitutional, the remaining provisions remain in full force and effect (Section 30).
The Act takes effect fifteen (15) days after publication in the Official Gazette or in at least two (2) newspapers of general circulation (Section 31).