Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

18% CONGRESS
First Regular Session
House Bill No. 5494

Introduced by
Hon. Deogracias Victor Savellano
Hon. Joseph Stephen Paduano and Hon. John Marvin Nieto

EXPLANATORY NOTE

Under the 1987 Constitution, it is the declared policy of the State to foster the creation
and growth of cooperatives as a practical vehicle for promoting self-reliance and harnessing
people power towards the attainment of economic development and social justice; the State
shall encourage the private sector to undertake the actual formation and organization of
cooperatives and shall create an atmosphere that is conducive to the growth and
development of these cooperatives. Toward this end, the Government and all its branches,
subdivisions, instrumentalities and agencies shall ensure the provision of technical
guidance, financial assistance and other services to enable said cooperatives to develop
into viable and responsive economic enterprises and thereby bring about a strong
cooperative movement that is free from any conditions that might infringe upon the
autonomy or organizational integrity of cooperatives.

Republic Act No. 9820 (Philippine Cooperative Code of 2008) gave life to the above
constitutional policy. Its implementation has put the Cooperative Sector into the mainstream
of economic development. No longer are cooperatives being treated as small-time
business. Aside from empowering the people at the grassroots level, cooperatives are now
at the forefront of the government's amelioration program for the underprivileged and
disadvantaged sectors of the community. Among the ranks of government employees,
cooperative helped to augment their income and provided an avenue for empowering
public servants and make them more effective partners of the government in economic,
social and political amelioration.

Unfortunately, the growth of cooperatives in certain defined sectors are hampered and
marginalized by certain statutory restrictions, more specifically Article 36 thereof or the
prohibition of proxy voting in primary cooperatives. It effectively stymied the
parliamentary cooperative activities due to failure of cooperative members to participate in
cooperative parliamentary affairs. Matters such as this needs to be addressed to foster the
growth and development of cooperatives“among the ranks of those at the frontline in the
defense of Philippine sovereignty.



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

18 CONGRESS
First Regular Session
House Bill No. 9494

Introduced by
Hon. Deogracias Victor Savellano
Hon. Joseph Stephen Paduano and Hon. John Marvin Nieto

AN ACT AMENDING THE COOPERATIVE CODE OF THE PHILIPPINES TO BE
KNOWN AS THE “PHILIPPINE COOPERATIVE CODE OF 2008”

CHAPTER IV
ADMINISTRATION

Sec 1. Section 36 of R.A 9520 otherwise known as the Philippine Cooperative
Code of 2008 is hereby amended to read as follows:

ART. 36. Voting System. - Each member of a primary cooperative shall
have only one (1) vote. In the case of members of secondary or tertiary
cooperatives, they shall have one (1) basic vote and as many incentive
votes as provided for in the bylaws but not exceed five (8) votes. The
votes cast by the delegates shall be deemed as votes cast by the
members thereof.

However, the by-laws of a cooperative other than a primary
cooperative may provide for voting by proxy PROVIDED HOWEVER
THAT PRIMARY COOPERATIVES WHOSE MEMBERSHIP IS
WIDELY DISPERSED OR PRIMARY COOPERATIVES WHOSE
MEMBERS ARE MAJORITY IN THE ARMED FORCES, OR THE
MEMBERS ARE MAJORITY OF PERSONS WITH DISABILITIES OR
COOPERATIVES WHOSE MEMBERSHIP ARE MAJORITY
OVERSEAS FILIPINO WORKERS, OR SECTORS AS MAY BE
DETERMINED BY THE COOPERATIVE DEVELOPMENT
AUTHORITY voting by proxy means allowing a delegate of a
cooperative to represent or vote in behalf of another delegate of the
same cooperative widely dispersed, regional members P.A OFWs coop
that are nationwide in members as far as practicable membership with
10,000 you can allow it wide and dispersed membership like I.Ps OFWs
Phil Army Voting by proxy means allowing another MEMBER
(delegate) of a cooperative to represent or vote in behalf of another
MEMBER (delegate) of the same cooperative.


Sec. 2. Implementing Rules and Regulation- The Cooperative Development
Authority shall issue the necessary Implementing Rules and Regulations (IRR) to
effectively implement the provisions of this Act, in consultation with concerned
public and private sectors within sixty (60) days from the effectivity of this Act.

Sec. 3. Repealing Clause - All laws, decrees or rules inconsistent of this Act
are hereby repealed or modified accordingly.

Sec. 4. Effectivity - This Act shall take effect fifteen (15) days from the date of
publication in the Official Gazette or in at least two (2) National newspapers of

general circulation.

Adopted.