Definitions used in the guideline
- “Authority” refers to the Cooperative Development Authority.
- “Certificate of Good Standing (CGS)” is a certificate issued by the Authority to operating cooperatives that have complied with the mandatory requirements under RA 9520, IRR, and other administrative issuances, entitling them to avail incentives and privileges accorded to cooperatives.
- “Operating Cooperative” refers to a cooperative that has been performing cooperative activities with business operations whether realizing gains or losses.
- The business operation requirement may be waived only for newly registered cooperatives existing for not more than one (1) year from the date of registration.
- “Preceding Fiscal Year” refers to the fiscal year immediately preceding the date of regular CGS issuance.
- “Statutory Reports” refers to the mandatory reports prescribed under Section 2, Rule 8 in relation to Article 53 of RA 9520 and Section 3(f) of RA 6939.
- “Accountable Officers” refers to persons directly responsible for handling cooperative funds, securities, and properties, including Chairman, Manager, Treasurer, Cashier, Secretary, and other authorized custodians of the cooperative’s funds, merchandise, inventories, securities, and other assets.
- “Business Operation” refers to the economic undertaking of providing products and services to members in accord with the cooperative’s registered objectives.
Purposes and when CGS is issued
- A regular CGS is issued when an application is made to comply with mandatory requirements under RA 9520 and to avail incentives and privileges under the CDA-BIR Joint Rules and Regulations Implementing Articles 60 & 61 of RA 9520 in relation to RA 8424, and requirements of Local Government Units (LGUs) for permits and licenses.
- A special CGS is issued for other legitimate purposes, including: application for financial assistance from other financial institutions, importation of machineries/equipment/spare parts, rice importation program, or accreditation as training provider regardless of type and category.
Qualified cooperatives and special evaluation
- A CGS may only be issued to an operating cooperative.
- For importation purposes, the application is subject to further evaluation by the Authority to determine the cooperative’s capability to avail the privileges granted to cooperatives.
Requirements to obtain CGS
Before the Authority issues a CGS, the requesting cooperative must comply with the applicable requirements under Section 6.
For CGS for Regular Purpose, the requesting cooperative must submit:
- A letter request duly signed by the Cooperative Chairman or an authorized representative stating the reasons for the request.
- Proof of compliance to statutory reports for the preceding fiscal year, or complete copies thereof.
- A copy of the updated bond of accountable officers/employees of the cooperative.
- Minutes of the General Assembly Meeting for the current/preceding year containing: (i) results of the election of the Board of Directors and Committee Members, (ii) approval of development plan and/or annual plan and budget, and (iii) acceptance of General Assembly financial statements, management, and committee reports.
- For a newly registered cooperative, minutes of a special general assembly held within ninety (90) days after the date of registration.
- A certification fee.
For CGS for Special Purpose, the requesting cooperative must submit:
- A letter request duly signed by the Cooperative Chairman or authorized representative stating the purpose of the request.
- A copy of the latest CGS issued for regular purpose for the preceding year or current year, whichever is applicable.
- A favorable endorsement from the concerned Extension Office.
- A certification fee.
Newly registered cooperative exemptions
- A newly registered cooperative is exempt from compliance with the following requirements for regular purpose: Section 6.1(b & c).
- The exemption applies if the cooperative secures the CGS within ninety (90) days from the date of registration with the Authority.
- If the CGS is secured after ninety (90) days but not to exceed one (1) year from registration, the cooperative is only exempt from compliance with Section 6.1(b & d(pa1)).
Grounds for non-issuance
- The Authority shall not issue the CGS when any of the following conditions exists:
- Non-submission of statutory reports for two (2) or more consecutive years.
- Delayed submission of statutory reports for more than six (6) months for at least two consecutive years.
- Non-compliance with CDA guidelines, including violation of laws, guidelines, circulars, and by-laws.
- The existence of a question on legitimacy of leadership.
Signing authority and jurisdiction
- The approving authority and jurisdiction are allocated as follows:
- The Extension Office Director approves applications for CGS by cooperatives for both regular and special purposes, except the purposes reserved to the Executive Director and/or Chairperson.
- The Executive Director approves applications for CGS by tertiary cooperatives, Cooperative Banks, Insurance Cooperatives, or applications within the Central Office jurisdiction for the regular purpose.
- The Chairperson approves special CGS applications for:
- Incentives for the rice importation program, regardless of type and category.
- Incentives for the importation of machineries, equipment, and spare parts, regardless of type and category.
- Other specific purposes peculiar to electric cooperatives, cooperative banks, and cooperative insurance societies.
Waiver of specific requirements
- The Board of Administrators may waive imposition of the following requirements upon recommendation of the Extension Office Director:
- Statutory reports for the preceding year.
- Minutes of the General Assembly meeting for the preceding year, including results of election of the Board of Directors and Committee members.
- Waiver is allowed when compliance is deemed impossible due to force majeure or calamity or fortuitous event.
- If statutory reports and minutes are waived, the cooperative must still comply with the other requirements in Section 6.
- In lieu of the waived items, a certification must be secured stating the occurrence of the fortuitous event from the LGU and other concerned agencies.
Fees, penalties, filing period, and validity
The Authority charges a certification fee of PHP 100.00 for every CGS issued.
A penalty is charged in each of the following situations:
- PHP 300.00 for every year of failure to secure a CGS for regular purpose.
- PHP 300.00 for late filing of application for regular purpose.
A cooperative must secure a CGS for regular purpose on or before April 30 of the current year.
A request received after April 30 is treated as late filing and is imposed the PHP 300.00 penalty under the fees section.
Validity of CGS is governed as follows:
- A regular CGS is valid and effective until April 30 of the succeeding year.
- A special CGS is valid for six (6) months only from the date of issuance.
- No CGS with retroactive effectivity is issued.
Repeal and effectivity rules
- CDA Memorandum Circular No. 2008-03 dated February 14, 2008 is amended.
- All Extension offices of the Authority disseminate this Guideline to all concerned.
- The Guideline takes effect fifteen (15) days after filing a copy with the Office of National Administrative Register (ONAR).
- Approval is pursuant to Board Resolution No. 132, S-2011 dated May 6, 2011, adopted on 6 May 2011.