Legal basis and regulatory authority
- The Executive Order affirms the National Electrification Administration (NEA)’s continuing regulatory and supervisory authority under Republic Act No. 9136 and Presidential Decree No. 269, as amended by Presidential Decree No. 1645.
- The Executive Order anchors its authority on Section 57 of Republic Act No. 9136 on the conversion of electric cooperatives.
- The Executive Order reinforces that NEA exercises authority under Section 3 and Section 5 of Presidential Decree No. 1645 over all electric cooperatives, whether registered or not.
- The Executive Order recognizes that EPIRA’s Implementing Rules and Regulations (IRR) govern the conversion framework referenced in Rule 7, Section 7.
Policy on conversion options
- Electric cooperatives are given the option to convert into either stock corporations or stock cooperatives, following NEA Guidelines under Section 1.
- Conversion and the resulting governance are aligned with the post-conversion corporate governance frameworks under the applicable laws referenced in the IRR (i.e., the corporation framework for stock corporations and the cooperative framework for stock cooperatives).
Scope: which electric cooperatives are covered
- The conversion option under Section 1 applies to electric cooperatives following NEA Guidelines.
- The NEA’s continuing regulatory and supervisory authority under Section 2 applies to all electric cooperatives, whether registered or not registered with the CDA or the SEC.
- The Executive Order expressly covers electric cooperatives that are:
- registered with the Cooperative Development Authority (CDA), and
- registered with the Securities and Exchange Commission (SEC), and
- not registered with either CDA or SEC.
Conversion and registration paths
- Electric cooperatives may convert to stock corporations and be registered under the Corporation Code following NEA Guidelines under Section 1.
- Electric cooperatives may convert to stock cooperatives and be registered under the Cooperative Code of the Philippines following NEA Guidelines under Section 1.
- Electric cooperatives that do not convert to stock entities remain governed under the regulatory approach reflected in P.D. No. 269 as referenced in the IRR framework discussed in the preambular clauses.
NEA regulatory supervision continued
- Section 2 requires NEA to continue exercising regulatory and supervisory authority over electric cooperatives through institutional, financial, and technical supervision.
- Section 2 confirms NEA authority specifically under Republic Act No. 9136 and Presidential Decree No. 269, as amended by Presidential Decree No. 1645, focusing on Section 3 and Section 5 of P.D. No. 1645.
- NEA supervision applies regardless of whether an electric cooperative is registered with CDA or SEC, or is not registered with either.
Supersession, repeal, and conflict rule
- The Executive Order repeals or modifies inconsistent issuances through Section 3.
- Section 3 mandates that all orders, issuances, rules and regulations or parts thereof that are inconsistent with Executive Order No. 623 are repealed or modified accordingly.
- The Executive Order’s operative conflict rule applies to inconsistent provisions only, and it directs their repeal or modification in accordance with Section 3.