Law Summary
Declaration of Policy
- State policy promotes viability and growth of cooperatives as tools for equity, social justice, and economic development.
- Cooperatives recognized as associations for economic and social betterment of members, based on mutual aid and international cooperative principles.
- CDA primarily responsible for institutional development and regulation of cooperatives.
- Cooperatives have right to self-promotion and organization with government assistance when necessary.
- National agencies like NEDA and DTI must integrate cooperatives in national development plans.
- DOF and DBM to ensure resource availability for cooperative programs.
- Government to provide technical, financial assistance ensuring cooperatives' viability.
- Policy of non-interference in cooperative management maintained, except as provided by the Act.
Cooperative Development Authority (CDA)
- CDA reorganized and strengthened under this Act and attached to DTI for coordination.
- Head office in NCR, maintains 16 extension offices, including field district offices.
Powers, Functions, and Responsibilities of CDA
- Develop regulations, standards, and rules for cooperative operation.
- Formulate and implement comprehensive cooperative development plans.
- Register cooperatives and their amendments.
- Authorize branches and satellite offices.
- Issue Certificates of Recognition to Laboratory Cooperatives.
- Supervise and exercise jurisdiction over registered cooperatives.
- Require submission of annual reports and audited financial statements.
- Create an information system from cooperative data.
- Issue guidelines for use of statutory funds.
- Collect reasonable fees, fines, and charges.
- Require cooperatives to develop business continuity plans.
- Grant awards and incentives.
- Administer cooperative-exclusive grants.
- Conduct inspections and investigations to protect members and the public.
- Develop management and training programs emphasizing cooperative principles.
- Disciplinary actions including suspension and removal of officers/members after due process.
- Order suspension/cancellation of registration, dissolution, or liquidation.
- Compel general or representative assembly under Authority supervision.
- Hear and decide intra- and inter-cooperative disputes; decisions appealable to Court of Appeals.
- Implement alternative dispute resolution mechanisms, with exceptions for election disputes.
- Issue cease and desist orders; subpoena powers; cite for contempt with fines or imprisonment.
- Enforce decisions with assistance from law enforcement or LGUs.
- Recognize sectoral apex organizations and national alliances.
- Establish cooperative development councils at various government levels.
- Collaborate with agencies for technical, professional assistance, marketing, and product development.
- Designate representatives in Regional Development Councils.
- Establish linkages with academe and international institutions.
- Formulate training standards focusing on governance, management, and cooperative values.
- Maintain continuing education for Authority personnel.
Board of Directors
- Comprises Chairperson (rank of Undersecretary) and six Members (Assistant Secretary rank), appointed by the President.
- Each member represents specific cooperative clusters e.g., credit services, agriculture, public utilities.
- Secretaries of DTI and DILG serve as ex officio members.
- Gender balance and inclusion of a lawyer member encouraged.
Powers and Functions of the Board
- Policy formulation and strategic planning.
- Organize Authority structure and approve plans and budgets.
- Provide overall direction defining roles of government and private sectors.
- Conduct policy consultations with stakeholders.
- Decide cases involving cooperatives submitted to the Board.
- Authorize contracts and agreements.
Qualifications and Terms of Chairperson and Board Members
- Natural-born Filipino, holder of a bachelor’s degree.
- At least five years’ experience as a cooperative officer in represented cluster.
- Resident of the Philippines for five years.
- Must divest pecuniary interests upon appointment.
- Serve six-year terms without reappointment, except under specific transitional circumstances.
Removal and Meetings
- Removal for cause with eligibility for reappointment in certain cases.
- Board meets at least monthly; decisions require majority vote.
- Chairperson presides; senior member or elected member presides in absence.
Office of the Administrator and Deputy Administrators
- Administrator appointed by President, rank of Assistant Secretary, executes Board policies.
- Five Deputy Administrators oversee specific concerns: Administration, Institutional Development, Legal Affairs, Registration/Supervision, Credit Surety Fund.
Qualifications and Powers of the Administrator
- Natural-born Filipino, bachelor’s degree holder, civil service eligible.
- Five years’ experience as cooperative officer or government/NGO official related to cooperatives.
- Must divest pecuniary interests upon appointment.
- Prepares reports, manages human resources, prepares budgets, reports to President and Congress.
- Appoints lower personnel, represents Authority, performs other legal functions.
Registration for Tax Exemption
- Authority provides certified list of registered cooperatives to BIR, LGUs, and agencies for tax exemption processing.
- Violations dealt with under Article 140 of RA No. 9520.
Prohibition
- Unauthorized use of "cooperative", "coop", "co-op", or "koop" in business names without CDA registration is prohibited and penalized.
Settlement of Disputes
- Cooperative disputes settled preferably via ADR mechanisms as per RA 9520, RA 9285, and this Act’s provisions.
Training Standards
- CDA formulates training standards in partnership with education institutions.
- Accreditation of nonacademic training institutions possible.
- SUCs to provide technical assistance and guidance to cooperatives.
Partnership with Cooperative Sector
- CDA establishes partnership with cooperatives and academe for cooperative development functions.
- Recognition of apex organizations and national alliances as consultative bodies.
- Support for cooperative unions and federations.
Cooperatives in Education System
- Cooperative history, philosophy, principles integrated into formal and nonformal education curricula.
- Included in K to 12 social and civic studies subjects.
- SUCs may offer cooperative development in degree programs and related curricula.
Cooperatives in Agriculture and Fishery Sectors
- Promotion of agricultural, agrarian, aquaculture cooperatives a priority.
- Coordination with DA, DAR, NCIP, and other agencies for rural development.
Cooperatives in Banking System
- Development of cooperative banks and financial service cooperatives prioritized.
- Collaboration with BSP and cooperative sector.
Cooperatives Covered by Other Laws
- Registered cooperatives must secure all licenses and permits required by other laws.
Reorganization and Transitory Provisions
- CDA reorganized within 120 days.
- Existing personnel absorbed with retention of rank and salary unless cause for removal.
- Incumbent officials continue until new Board constituted.
- Authority manages existing funds and assets.
Appropriations
- Implementation funded through CDA’s current budget and subsequent General Appropriations Act.
Implementing Rules and Regulations
- Board to formulate IRR within 90 days.
- IRR published before effectivity; amendments also published.
Information Campaign
- Authority mandated to conduct massive information campaign on the Act.
Joint Congressional Oversight Committee on Cooperatives
- JCOCC to monitor and review implementation.
Repealing, Separability, and Effectivity
- RA No. 6939 repealed; other inconsistent laws amended.
- Unconstitutional provisions severable from remainder of the Act.
- Act takes effect 15 days after publication in Official Gazette or newspapers.