NINETEENTH CONGRESS OF THE } 
REPUBLIC OF THE PHILIPPINES }
First Regular Session 
}
SENATE 
S. B. No. 1589
tSfficp ol the £.^1 ft
*22 DEC -5 PI 59
RtCEIVhD Bv:
Introduced by Senator Francis "Tol" N. Tolentino
AN ACT
INSTITUTING AGRICULTURAL COOPERATIVISM IN THE PHILIPPINES, 
AMENDING FOR THE PURPOSE CERTAIN SECTIONS OF R.A. NO. 11364, R.A. 
NO. 9520, AND R.A. NO. 7160, AND APPROPRIATING FUNDS THEREFOR
EXPLANATORY NOTE
All over the world, agricultural cooperatives help build sustainable communities in 
rural areas by allowing growers to enter bigger markets and sell their goods and supplies 
at lower prices. Members of agricultural cooperatives are also more economically 
protected compared to individual farmers.1
There are over 1.2 agricultural cooperatives worldwide, generating about $6.5 
Billion in net income each year and employing more than 250,000 people.2 In the 
Philippines, there are only 1,392 agricultural cooperatives out of the total of 18,847 
operating cooperatives in the country.3
While the existing legislation on cooperatives has already broadened the scope of 
the Rural Credit Law, which aimed to protect and develop the country’s interest in 
agriculture, there is a need to institutionalize general agricultural cooperativism to further 
develop and protect the agricultural sector.
This bill seeks to provide more protection and benefits to strengthen agricultural 
cooperatives and simplify the process of registration. It aims to create an atmosphere
https://eos.com/blog/agricultural-cooperatives/
1 https://ncbaclusa.coop/resources/co-op-sectors/agriculture-co-ops/
3 inciudes cooperatives under agrarian reform, agriculture, dairy, and fishermen.


where the agricultural sector will have the support it needs to be competitive in the open 
market through the following:
1. Creating a Policy Board for Agricultural Cooperatives. The Policy Board 
shall be a think-tank operating solely for the agricultural cooperatives. It is created 
to highlight the importance of agricultural cooperatives and shall:
a) craft policies and strategic plans concerning the development of agricultural 
cooperatives in line with the socio-economic conditions of the Philippines;
b) set directions to enhance the capacity of agricultural cooperatives and to 
enhance the cooperation between and among agricultural cooperatives, 
private sector, and development partners;
c) coordinate with concerned government institutions, private sector, and 
financial institutions to support the operation of agricultural cooperatives; 
and
d) address issues and challenges hindering the implementation of the national 
policy, and strategic and action plans for agricultural cooperatives 
development.
2. Creating the Agricultural Cooperatives Board (ACB)\ While the ACB shall 
be under the CDA and chaired by one of its existing Directors, it aims to serve 
only the needs of agricultural cooperatives. This shall ensure that the dedicated 
board can focus on developing the sector and shall:
a) support the functioning, operation, and development of agricultural 
cooperatives;
b) design strategic plan and training programs to promote, strengthen and 
develop agricultural cooperatives;
c) manage the database of and provide training services for agricultural 
cooperatives;
d) assess the economic situations of agricultural cooperatives to meet market 
demands and provide market information to agricultural cooperatives; and
e) undertake national and international cooperation on agricultural 
cooperatives


3. Simplifying the registration process for agricultural cooperatives and 
including LGUs in registration, training, and development to ensure that:
a) unnecessary entry barriers [in the registration process] are removed;
b) agricultural cooperatives' needs are addressed at the LGU level; and
c) grassroots' concerns are heard and immediately resolved.
4. Granting additional benefits to agricultural cooperatives to facilitate 
market entry.
To implement the foregoing reforms, it is necessary to amend R.A. No. 113644 to 
pave the way for the creation of the Policy Board and the ACB, and to institutionalize the 
reforms contained in this Act. Specifically, under Sec. 20 of R.A. No. 11364, the CDA was 
mandated to prioritize the promotion and development of cooperatives in the agriculture 
and fishery sectors to ensure food security and reduce rural poverty. This bill enhances 
the capability of the CDA to implement this mandate.
In view of the foregoing, immediate passage of this bill is earnestly sought.
TOL" N. TOLENTINO
* Cooperative Development Authority Charter of 2019.


NINETEENTH CONGRESS OF THE } 
REPUBLIC OF THE PHILIPPINES }
First Regular Session 
}
SENATE
S. B. No. 1589
Senate
of tl)C £^f
•22 DEC “5 PI 59
RtCEi'- ED BV
Introduced by Senator Francis "Tol" N. Tolentino
AN ACT
INSTITUTING AGRICULTURAL COOPERATIVISM IN THE PHILIPPINES, 
AMENDING FOR THE PURPOSE CERTAIN SECTIONS OF R.A. NO. 11364, R.A. 
NO. 9520, AND R.A. NO. 7160, AND APPROPRIATING FUNDS THEREFOR
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled:
1
2
3
4
5
6
7
8 
9
10
11
12
13
CHAPTER I - GENERAL CONCEPTS AND PRINCIPLES
SECTION 1. Short Title. - This Act shall be known as the "Genuine Agricultural 
Cooperativism Reform Act of 2019."
Sec. 2. Declaration of Policy. - It is the declared policy of the State to foster the 
creation and growth of agricultural cooperatives as a practical vehicle for promoting self- 
reliance towards the attainment of economic development and social justice among the 
agricultural industry. The State shall encourage the organization of agricultural 
cooperatives and shall create an atmosphere that is conducive to their growth and 
development.
Towards this end, the State shall promote participation of every citizen whose primary


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
occupations fall within the framework of agricultural production, agro-industry, 
agribusiness or services related to agricultural production systems in establishing and 
developing agricultural cooperatives to augment economic, social, and cultural status of 
members as well as to contribute to the national economic development.
Sec. 3. Definition of Terms. The following terms shall mean:
a) ACB- refers to the Agricultural Cooperative Board created under Sec. 6 of this Act. 
It shall be headed by the Director for Agriculture, Agrarian, Aquaculture, Farmers, 
Dairy and Fisherfolk defined in Paragraph (e). Section 5 of Republic Act No. 11364.
b) Agricultural Cooperative - refers to an agricultural-based economic enterprise 
which is voluntarily established by persons with their joint investment, joint 
ownership and joint management in order to improve agricultural production 
capacity, agro-industry, agri-business, or services related to agricultural 
production.
It shall encompass the following types of cooperatives defined under R.A. No. 9520 
and R.A. No. 11364: Agrarian Reform, Agriculture, Dairy, Fishermen, and 
Aquaculture. It also includes Multipurpose Cooperatives defined under R.A. No. 
9520 whose primary business activity is at least 50% related to agricultural 
production, agro- industry, agri-business, or services related to agricultural 
production.
c) Agricultural Cooperative Officer- refers to the Provincial Cooperative Officer, the 
City Cooperative Officer, or the Municipal Cooperative Officer under Section 7 of 
this Act.
d) CDA - refers to the Cooperative Development Authority created under R.A. No. 
11364.
e) IRR - refers to any or all implementing rules and regulations and/or guidelines 
issued in accordance with this Act.


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
f) Policy Board- refers to the Policy Board for Agricultural Cooperatives under Section 
4 of this Act.
Sec. 4. Policy Board for Agricultural Cooperatives. - There is hereby created an 
Agricultural Cooperatives Policy Board to be co-chaired by the Secretary of Agriculture as 
Chair and the Secretary of Trade and Industry, or their nominees, with the following as 
members, to wit: a representative from the Department of Interior and Local Government, 
Department of Finance, the cooperative sector, and civil society.
Sec. 5. Powers and Duties of the Policy Board. —The Agricultural Cooperatives Policy 
Board as a think-tank for Agricultural Cooperatives shall have the following powers and 
duties:
a) prepare and evaluate policies, strategic action plans, and work plans concerning 
the development of Agricultural Cooperatives in line with the socio-economic 
conditions of the Philippines;
b) set directions to enhance the capacity of Agricultural Cooperatives and to enhance 
the cooperation between and among Agricultural Cooperatives, private sector, and 
development partners;
c) coordinate with the CDA and other concerned government agencies, private sector, 
and financial institutions in order to support for the operation of Agricultural 
Cooperatives;
e) issue resolutions or circulars to concerned agencies or local government units 
(LGU) to come out with programs and strategic action plans concerning the 
development of Agricultural Cooperatives;
f) address issues and challenges hindering the implementation of the national policy, 
and strategic action plans for Agricultural Cooperatives' development;
g) perform other duties to support the policies for the development of Agricultural


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
Cooperatives as provided for under this Act.
Sec. 6. The Agricultural Cooperative Board (ACB) - The Agricultural Cooperatives 
Board (ACB) is hereby created to promote and support the establishment, operation, and 
development of Agricultural Cooperatives, and shall:
a) act as the Secretariat of the Policy Board;
b) promote and support the functioning, operation, and development of Agricultural 
Cooperatives;
c) study and design policies, legal framework, strategic plans, and training programs 
to promote, strengthen, and develop Agricultural Cooperatives;
d) provide training services to Agricultural Cooperatives in coordination with the LCDs;
e) carry out outreach programs to promote awareness and to provide trainings aimed 
at building the capacity of Agricultural Cooperatives;
f) facilitate the linkages between Agricultural Cooperatives with private sector and 
concerned institutions, both domestic and foreign;
g) study and assess the economic situations of Agricultural Cooperatives to meet 
market demands and provide market information to agricultural cooperatives;
h) undertake national and international cooperation on Agricultural Cooperatives;
i) take part in resolving all disputes of Agricultural Cooperatives; and
j) prepare reports on the progress of development of Agricultural Cooperatives and 
submit them to Congress; and
k) perform other duties within the framework of agricultural cooperative development


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
in line with this Act.
The organization of the ACB shall be defined in the IRR.
Sec. 7. Responsibilities of Local Government Units. — The Local Government Units 
(LGU) shall:
a) legislate necessary ordinances for the promotion and development of Agricultural 
Cooperatives;
b) disseminate information to people and facilitate the establishment, development, 
and management and operations of Agricultural Cooperatives in their respective 
locality;
c) take part in solving disagreements arising within and among Agricultural 
Cooperatives;
d) free and regular seminars, trainings and/or conferences necessary for the 
organization, registration, management, and operations of agricultural 
cooperatives; and
e) monitor and evaluate the implementation of this Act.
The appointment of a local agricultural cooperative officer shall be mandatory for the 
provincial, city and municipal governments who shall have the power and authority to 
accept and process applications for registration of agricultural cooperatives within their 
respective jurisdictions.
For exemplary reasons, applications from other LGUs may be accepted by any local 
agricultural cooperative officer, as defined in the IRR.
Sec, 8. Preferential Treatments and Privileges of Agricultural Cooperatives. -
Agricultural Cooperatives shail be encouraged by and shall enjoy preferential treatments


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
and privileges from the national government and the LGUs, as defined in the IRR and local 
ordinances.
Sec. 9. Application of Chapter V of R.A. No. 9520. - The provisions of Chapter V of 
R.A. No. 9520 shall be applicable to Agricultural Cooperatives. Inconsistent principles shall 
be resolved in favor of the principles and provisions of this Act.
CHAPTER II - ORGANIZATION AND REGISTRATION
Sec. 10. Organization of Agricultural Cooperatives. — The organization and 
registration of Agricultural Cooperatives shall adhere to the following:
a) A group of fifteen (15) or more natural persons who are Filipino citizens, of legal 
age, and whose primary activity or business falls within agricultural production 
system, agro-industry, agri-business or services related to agricultural production 
sector and are actually residing or working in the intended area of operation, may 
establish an Agricultural Cooperative.
b) In addition to the existing organization and registration procedures of the CDA, an 
Agricultural Cooperative may also process their registration through the local 
agricultural cooperative officer. Denied applications shall be automatically reviewed 
by the ACB. All approved registrations by the local agricultural cooperative officer 
and those approved in review by the ACB shall be forwarded to the CDA for the 
issuance of Certificate of Registration. Non-issuance of the Certificate of 
Registration shall not affect the validity of any registration.
c) All forms and necessary documentary requirements shall be made available to any 
applicant free of charge.
d) The ACB shall issue the necessary guidelines for the simplified organization and 
registration process for Agricultural Cooperatives. The uniform registration 
proceedings shall not extend beyond a period of 30 calendar days. Reviews by the 
ACB shall be resolved within the same period.


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
e) for purposes of this Act, the local agricultural cooperative officer, in addition to the 
mayor, vice-mayor, and all members of the Sanggunian, shall be granted authority 
to administer oath, and such act shall be given free of charge.
f) An application for registration shall only be denied on the ground that the applicant 
is not an Agricultural Cooperative.
Sec. 11. Application of Chapter II/ III, & IV of R.A. No. 9520. - The provisions of 
Chapters II, III, & IV of R.A. No. 9520 shall apply to Agricultural Cooperatives in so far as 
not inconsistent with the principles and provisions of this Act and its IRR.
Sec. 12. Fees and Charges- Notwithstanding the provision of Sec. 15 hereof, no fees 
shall be assessed or charged to any Agricultural Cooperative by any government entity, 
national or local, at any stage of its organization and registration process.
Sec. 13. Implementing Rules and Regulations- Within 180 days from the approval 
of this Act, the ACB, with the approval of the Policy Board, and in coordination with the 
Administrator of the CDA, shall issue the necessary IRR to implement this Chapter.
CHAPTER III - PREFERENTIAL BENEFITS AND PRIVILEGES
Sec. 14. Responsibilities, Benefits and Privileges of Agricultural Cooperatives.
— An Agricultural Cooperative shall have the following responsibilities and shall enjoy the 
following unrestricted benefits and privileges:
a) Responsibilities, Taxes, Duties, and Liens:
i. 
All responsibilities of cooperatives defined under Chapter V of R.A. No. 9520 
shall apply to Agricultural Cooperatives insofar as these responsibilities are 
consistent with the provisions of this Act;
ii. All benefits and tax treatments of cooperatives defined under Chapter V of R.A. 
No. 9520 shall apply to Agricultural Cooperatives, even those dealing with non­
members, insofar as these benefits and tax treatments are consistent with the


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
provisions of this Act.
iii. Agricultural Cooperatives shall be exempt from customs duties, advance sales 
or compensating taxes on their importation of machineries, equipment and 
spare parts used by them.
iv. All sales, services, or transactions of Agricultural Cooperatives shall not be 
subject to any taxes and fees imposed under the internal revenue laws and 
other tax laws, including income taxes, VAT, percentage taxes sales, and local 
sales taxes.
V. All real properties owned, and those directly used for the operations, 
management, and maintenance of Agricultural Cooperatives shall be exempt 
from the payment of real property taxes imposed under existing laws.
vi. On the tenth year after the approval of this Act, the ACB may, in coordination 
with the relevant government institutions, promulgate guidelines defining the 
thresholds of accumulated reserves and undivided net savings of Agricultural 
Cooperatives for the purpose of imposing reasonable limits on transactions with 
non-members and the general public.
b) Trainings and Conferences:
i. All trainings and/or conferences necessary for the organization, registration, 
management, and operations of an Agricultural Cooperative shall be given free 
of charge, including costs of venue, training materials, speakers and resource 
persons. The local agricultural cooperative officers shall be primarily 
responsible for these trainings and conferences within their respective 
localities.
c) Loans and Grants:
i. All loans applied for by Agricultural Cooperatives on any government owned or


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
controlled banks or financial institutions shall enjoy preferential status and 
handling as to requirements, rates, securities, and collaterals.
ii. The Policy Board, through the ACB, shall coordinate with the Banko Sentra! ng 
Pilipinas to lower the thresholds for all loans applied for and granted to 
Agricultural Cooperatives.
iii. All loans and grants granted to Agricultural Cooperatives shall be exempt from 
the payment of all taxes and fees by any government unit or institution, 
including the Bureau of Internal Revenue (BIR).
Sec. 15. Joint Implementing Rules and Regulations- The Policy Board, Banko 
Sentra! ng Pilipinas, and BIR shall jointly, within 180 days from the approval of this Act, 
issue the necessary guidelines for the implementation of this Chapter.
CHAPTER IV - APPLICATION OF OTHER PROVISIONS OF R.A. No. 9250 AND
R.A. No. 11364
Sec. 16. Other Provisions ofR.A. No. 9250- In so far as not inconsistent with this 
Act, all other provisions of R.A. No. 9250 shall continue to apply to Agricultural 
Cooperatives.
The CDA shall liberally exercise its powers to implement the provisions of R.A. No. 9250 
in favor of Agricultural Cooperatives and the principles enunciated in this Act.
Within 180 days from the effectivity of this Act, the CDA, in coordination with the Policy 
Board, is shall issue a more liberal and simplified implementing rules and regulations for 
all other provisions of R.A. No. 9250 and R.A. No. 11364 applicable to Agricultural 
Cooperatives in line with the principles enunciated with this Act.
CHAPTER V - FINAL PROVISIONS
Sec. 17. Implementing Rules and Regulations. — The Agricultural Cooperatives 
Policy Board, in consultation with the CDA, shall issue rules and regulations to implement


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
those provisions of this Act which expressly call for the issuance thereof. This paragraph 
shall not apply to those cases wherein a specific provision of this Act expressly designates 
particular government agencies which shall issue the regulations called for by any 
provision of this Act.
Sec. 18. Pena! Provisions - In addition to the penal provisions of R.A. No. 9250 and 
the applicable penal provisions of R.A. No. 11364, any local agricultural cooperative 
officer, officer of the ACB, or officer of the CDA, who shall refuse to process or delay the 
processing of registration of an Agricultural Cooperative shall be punished by a fine of not 
less than five hundred thousand pesos (P500,000.00) but not more than five million pesos 
(P5,000,000.00) and suffer imprisonment of not less than four (4) years but not more 
than six (6) years: Provided, That the conviction or acquittal obtained under this section 
shall not be a bar to the filing of any civil or administrative suit.
Furthermore, any member of an Agricultural Cooperative, or any person who shall violate 
any provision of this Act shall be punished by a fine of not less than one million pesos 
(PI,000,000.00) but not more than ten million pesos (P10,000,000.00) and suffer 
imprisonment of not less than six (6) years but not more than twelve (12) years: Provided, 
That the conviction or acquittal obtained under this section shall not be a bar to the filing 
of any civil or administrative suit.
Sec. 19. Interpretation and Construction. - In case of doubt as to the meaning of 
any provision of this Act or the regulations issued in pursuance thereof, the same shall be 
resolved liberally in favor of Agricultural Cooperatives and their members.
Sec. 20 Appropriations. — The funds needed to carry out the provisions of this Act 
shall be charged to the appropriations of the CDA under the current General 
Appropriations Act: Provided, That in the initial year of operations of the Policy Board and 
the ACB, an additional amount of not exceeding One Hundred Million Pesos 
(P100,000,000.00) may be requested and drawn by the CDA from the Department of 
Agriculture, and the Department of Trade and Industry, and from any other available 
source. Thereafter, such sums as may be necessary for its continued implementation shall 
be included in the annual General Appropriations Act.
10


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
Sec. 21. The Joint Congressional Oversight Committee on Cooperative (JCOCC).
— The Joint Congressional Oversight Committee created under R.A. 9520 shall review and 
monitor the proper implementation of this Act.
Sec. 22. Repealing Clause. - Except as expressly provided by this Act, all other laws 
or regulations, or parts thereof, inconsistent with any provision of this Act shall be deemed 
repealed: Provided, That the relevant provisions of R.A. No. 9520, R.A. No. 11364, and 
R.A. No. 7160 as applicable to Agricultural Cooperatives are hereby repealed, amended 
or modified accordingly.
Sec. 23. Transitory Provisions. -
a) All Agricultural Cooperatives registered and confirmed under R.A. No. 9520 are 
hereby deemed registered under this Act, and a new certificate of registration shall 
be issued by the CDA: Provided, That such cooperative shall submit to its local 
agricultural cooperative office a copy of their certificate of registration or certificate 
of confirmation, the articles of cooperation, their bylaws, and their latest audited 
financial statement within one (1) year from the effectivity of this code, otherwise 
the shall be deemed cancelled motu proprio.
b) Following the issuance of the new certificate of registration, the registered 
agricultural cooperatives shall secure their certificate of tax exemption from the 
nearest office of the BIR: Provided, That such exemptions shall be valid often (10) 
years from the date of issue, unless extended by the Policy Board: Provided, 
further. That all unpaid assessments of previously registered Agricultural 
Cooperative under R.A. No. 9520 shall be the subject of compromise settlement 
on terms favorable to such Agricultural Cooperative; and: Provided, finally. That 
the BIR and the ACB shall be jointly issue the necessary regulations on this 
exemption and compromise within ninety (90) days from the effectivity from this 
Code.
Sec. 24. Separability Clause. - Should any part of this code be declared 
unconstitutional, the validity of remaining provision hereof shall remain in full and effect.
11


1
2
3
4
Sec. 25. Effectivity Clause. - This code shall take effect fifteen (15) days from its 
publication in a newspaper of general circulation.
Approved,
12