1 
Republic of the Philippines 
House of Representatives 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ___ 
Introduced by Hon. Felimon M. Espares 
COOP-NATCCO PARTYLIST 
AN ACT FURTHER STRENGTHENING THE COOPERATIVE 
MOVEMENT IN THE COUNTRY, AMENDING FOR THE 
PURPOSE REPUBLIC ACT NO. 6938, AS AMENDED 
EXPLANATORY NOTE 
Cooperatives are indispensable partners of the government in the socio-
economic development of the country, and their contributions are undeniable. It is, 
therefore, right and just to continue to support cooperatives as they grow and engage 
more and more Filipinos to partake in the cooperative spirit and movement. 
The contribution of cooperatives in promoting social justice and economic 
development cannot be denied. The more than twenty-six thousand (26,000) 
cooperatives nationwide serving more than fourteen (14) million members and 
employing some five hundred and thirty thousand (530,000) individuals are 
testaments to the importance of cooperatives in our country. As partners of the State 
in socio-economic development and nation-building, it is imperative that cooperatives 
be granted essential privileges in order to ensure their sustainability, growth, and 
development. 
It has been fourteen (14) years since the Cooperative Code of the Philippines 
was last amended. Since then, various developments—no less than the COVID-19 
pandemic—have happened, both directly and indirectly affecting the membership and 
operations of cooperatives. Thus, it is high time that the laws governing cooperatives 
are updated in order to allow the latter to adapt and continuously grow. For example, 
it is the current thrust of the administration to remove cooperatives from the 12th 
Regular Foreign Investment Negative List, which was issued under Executive Order 
No. 175 last June 2022. In order to achieve this goal while still ensuring the protection 
of cooperatives as a social justice enterprise, amending the Cooperative Code is 
necessary. 
After numerous extensive consultations with various members of the 
cooperative sector, the undersigned has decided to file a bill that seeks more 
substantive and comprehensive amendments to the prevailing Cooperative Code. The 
May 11, 2023
8:36 am
8067


2 
amendments proposed hereunder comprise the changes that the members of the 
sector have deemed fundamental for the continued growth and development of the 
sector. 
In view of the foregoing, the early passage of this bill is earnestly sought. 
HON. FELIMON M. ESPARES 


3 
Republic of the Philippines 
House of Representatives 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO___________ 
Introduced by Hon. Felimon M. Espares 
COOP-NATCCO PARTYLIST 
AN ACT FURTHER STRENGTHENING THE COOPERATIVE 
1 
MOVEMENT IN THE COUNTRY, AMENDING FOR THE 
2 
PURPOSE REPUBLIC ACT NO. 6938, AS AMENDED 
3 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
4 
Section 1. Articles 1 and 5 of Chapter I on General Concepts and Principles 
5 
of Republic Act No. 6938, as amended, are hereby further amended to read as 
6 
follows: 
7 
8 
“ARTICLE 1. TITLE. – This Act shall be known as the 
9 
[“Philippine 
Cooperative 
Code 
of 
2008”.] 
“PHILIPPINE 
10 
COOPERATIVE CODE OF 2023”. 
11 
ART. 2. DECLARATION OF POLICY. – x x x. 
12 
ART. 3. GENERAL CONCEPTS. – x x x. 
13 
ART. 4. COOPERATIVE PRINCIPLES. – x x x. 
14 
ART. 5. DEFINITION OF TERMS. – x x x. 
15 
(17) Federation of Cooperatives – [refers to three or more
16 
primary cooperatives, doing the same line of business, organized 
17 
at the municipal, provincial, city, special metropolitan political 
18 
subdivision, or economic zones created by law, registered with 
19 
the Authority to undertake business activities in support of its 
20 
member-cooperatives.] REFERS TO A COOPERATIVE, THE MEMBERS 
21 
OF WHICH ARE PRIMARY COOPERATIVES AND/OR COOPERATIVE 
22 
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4 
FEDERATIONS, ORGANIZED TO CONDUCT BUSINESS, UNDERTAKE 
23 
ENABLING OR CAPACITY-BUILDING ACTIVITIES, AND DELEGATED 
24 
SUPERVISION IN SUPPORT OF ITS MEMBER-COOPERATIVES, AT THE 
25 
MUNICIPAL, CITY, PROVINCIAL, REGIONAL, AND NATIONAL LEVELS. 
26 
27 
(18) COOPERATIVE UNION - REFERS TO A COOPERATIVE, THE
28 
MEMBERS OF WHICH ARE REGISTERED COOPERATIVES, ORGANIZED 
29 
PURPOSELY TO REPRESENT THE INTEREST AND WELFARE OF ALL 
30 
TYPES OF COOPERATIVES AT THE MUNICIPAL, CITY, PROVINCIAL, 
31 
REGIONAL, AND NATIONAL LEVELS. 
32 
33 
(19) APEX OF COOPERATIVES – THE SINGULAR COOPERATIVE
34 
VESTED WITH THE JURIDICAL PERSONALITY AND THE MANDATE TO 
35 
REPRESENT THE SECTOR AT THE NATIONAL AND INTERNATIONAL 
36 
LEVELS, FULLY AND VOLUNTARILY ORGANIZED BY THE MEMBERS OF 
37 
THE SECTOR. IT SHALL HAVE THE MANDATE TO ENGAGE IN 
38 
DISCUSSIONS AND ADVISE THE APPROPRIATE AUTHORITIES ON ALL 
39 
MATTERS RELATING TO COOPERATIVES, AS WELL AS TO PROMOTE THE 
40 
COOPERATIVE IDENTITY AND CULTURE.” 
41 
42 
Section 2. Articles 9, 10, 11, 14, 16, 23 and 24 of Chapter II on 
43 
Organization and Registration of the same Code are hereby amended to read are 
44 
hereby further amended to read as follows: 
45 
“ART. 6. PURPOSES OF COOPERATIVES. – x x x. 
46 
ART. 7. OBJECTIVES AND GOALS OF A COOPERATIVE. – x x x. 
47 
ART. 8. COOPERATIVES NOT IN RESTRAINT OF TRADE. – x x x. 
48 
ART. 9. COOPERATIVE POWERS AND CAPACITIES. – A cooperative 
49 
registered under this Code shall have the following powers, 
50 
rights, and capacities: 
51 
52 
xxx 
53 
54 
(5) To purchase, receive, take or grant, hold, convey, sell,
55 


5 
lease, pledge, mortgage, and otherwise deal with such real and 
56 
personal property as the transaction of the lawful affairs of the 
57 
cooperative may reasonably and necessarily require, subject to 
58 
the limitations prescribed [by law] and the Constitution; 
59 
PROVIDED, THAT COOPERATIVES SHALL BE EXEMPT FROM THE 
60 
LANDHOLDING LIMITS AS PRESCRIBED BY THE DEPARTMENT OF 
61 
AGRARIAN REFORM OR ANY OTHER LAW REQUIRING THE SAME; 
62 
63 
xxx 
64 
65 
ART. 10. ORGANIZING A PRIMARY COOPERATIVE. – [Fifteen (15)] 
66 
TWENTY-FIVE (25) or more natural persons who are Filipino 
67 
citizens, of legal age, having a common bond of interest, and are 
68 
actually residing or working in the intended area of operation, 
69 
may organize a primary cooperative under this Code: Provided, 
70 
That a prospective member of a primary cooperative must have 
71 
completed a Pre-Membership Education Seminar (PMES). 
72 
PROVIDED, FURTHER, THAT ONLY THE FOLLOWING MAY BE MEMBERS 
73 
OF A PRIMARY COOPERATIVE: 
74 
A. FILIPINO CITIZENS LIVING IN THE PHILIPPINES; AND
75 
B. FORMER NATURAL-BORN FILIPINO CITIZENS, WHO MUST
76 
COMPLY WITH PHILIPPINE TAXATION LAWS.
77 
78 
Any newly organized primary cooperative may be 
79 
registered as multipurpose cooperative only after compliance 
80 
with the minimum requirements for multipurpose cooperatives to 
81 
be set by the Authority. A single purpose cooperative may 
82 
transform into a multipurpose or may create subsidiaries only 
83 
after at least two (2) years of operations. 
84 
85 
EVERY PRIMARY COOPERATIVES MUST BECOME A MEMBER OF A 
86 
FEDERATION AND/OR UNION WITHIN THREE (3) YEARS OF THE 
87 
ISSUANCE OF ITS CERTIFICATE OF REGISTRATION FROM THE 
88 


6 
AUTHORITY. FAILURE OF THE COOPERATIVE TO COMPLY WITH THIS 
89 
REQUIREMENT SHALL RESULT IN APPROPRIATE SANCTIONS, SUCH AS 
90 
SUSPENSION OF PRIVILEGES OR NON-ISSUANCE OF THE CERTIFICATE 
91 
OF COMPLIANCE, AMONG OTHERS, AS MAY BE DECIDED BY THE 
92 
AUTHORITY. 
93 
94 
ART. 11. ECONOMIC SURVEY OR FEASIBILITY STUDY. – Every 
95 
group of individuals or cooperatives intending to form a 
96 
cooperative under this Code shall submit to the Authority a 
97 
general statement describing, among others the structure and 
98 
purposes of the proposed cooperative; Provided, further, That 
99 
they shall not be allowed to operate without the necessary 
100 
personnel, and shall also submit an economic survey OR A 
101 
FEASIBILITY STUDY, indicating therein the area of operation, the 
102 
size of the membership, and other pertinent data, in a format 
103 
provided by the Authority. 
104 
105 
THE ECONOMIC SURVEY OR FEASIBILITY STUDY SHALL BE 
106 
SUBJECT TO THE REVIEW OF THE AUTHORITY.  BOTH MUST INCLUDE 
107 
INFORMATION ON EXISTING COOPERATIVES IN THE SAME LINE OF 
108 
BUSINESS AND PROVIDING SIMILAR SERVICES IN THE PROPOSED 
109 
AREA OF OPERATION, IF ANY, AND ANY PREVIOUS COOPERATIVES 
110 
ORGANIZED OR OPERATED BY THE COOPERATORS. THE AUTHORITY 
111 
SHALL 
THOROUGHLY 
EXAMINE 
THE 
ECONOMIC 
SURVEY 
OR 
112 
FEASIBILITY STUDY IN ORDER TO DETERMINE IF THE ESTABLISHMENT 
113 
OF A NEW COOPERATIVE IN THE PROPOSED AREA OF OPERATION IS 
114 
ACTUALLY FEASIBLE OR VIABLE. IF NOT, THE AUTHORITY SHALL DENY 
115 
THE APPLICATION FOR REGISTRATION. 
116 
117 
ART. 11-A. BRANCH, SATELLITE, AND LIAISON OFFICES – A 
118 
COOPERATIVE MAY OPERATE BRANCH, SATELLITE, AND LIAISON 
119 
OFFICES WITHIN ITS AREA OF OPERATION, SUBJECT TO REGULATION 
120 
BY THE AUTHORITY. THE AUTHORITY AND THE SECTOR SHALL ISSUE 
121 


7 
 
 
RULES REGARDING THE CREATION AND OPERATION OF BRANCH, 
122 
SATELLITE, AND LIAISON OFFICES OF COOPERATIVES. 
123 
 
124 
ART. 12. LIAIBILITY. – x x x. 
125 
ART. 13. TERMS. – x x x. 
126 
ART. 14. ARTICLES OF COOPERATION. –  
127 
(1) x x x 
128 
(2) x x x 
129 
(3) x x x 
130 
(4) x x x 
131 
(5) No cooperative, other than a cooperative union as 
132 
described under Article 25 hereof, shall be registered unless the 
133 
articles of cooperation [is] ARE accompanied with the bonds of 
134 
the accountable officers and a sworn statement[s] of the 
135 
treasurer elected by the subscribers showing that at least twenty-
136 
five per centum (25%) of the authorized share capital has been 
137 
subscribed and at least twenty-five per centum (25%) of the total 
138 
subscription has been paid: Provided, That in no case shall the 
139 
paid-up share capital be less than Fifteen Thousand Pesos 
140 
(P15,000.00)[.] FOR AGRICULTURAL COOPERATIVES, AND TWENTY-
141 
FIVE THOUSAND PESOS (P25,000.00) FOR NON-AGRICULTURAL 
142 
COOPERATIVES. 
143 
 
144 
The Authority shall periodically assess the required paid-up 
145 
share capital and may increase it every five (5) years when 
146 
necessary upon consultation with the cooperative sector and the 
147 
National Economic and Development Authority (NEDA). 
148 
 
149 
ART. 15. BY-LAWS. – x x x. 
150 
ART. 16. REGISTRATION. – A cooperative formed and 
151 
organized under this Code acquires juridical personality from the 
152 
date the Authority issues a certificate of registration under its 
153 
official seal. All applications for registration shall be finally 
154 


8 
 
 
disposed of by the Authority within a period of [sixty (60)] 
155 
THIRTY (30) days from the filing thereof, otherwise the 
156 
application is deemed approved, unless the cause of the delay is 
157 
attributable to the applicant: Provided, That in case of a denial 
158 
of the application for registration, an appeal shall lie with the 
159 
[Office of the President] DEPARTMENT OF TRADE AND INDUSTRY 
160 
(DTI) within [ninety (90)] SIXTY (60) days from receipt of notice 
161 
of such denial: Provided, further, That failure of the [Office of 
162 
the President] DTI to act on the appeal within [ninety (90)] 
163 
SIXTY (60) days from the filing thereof shall mean approval of 
164 
said application. THE DECISION OF THE DTI SHALL BE FINAL AND 
165 
EXECUTORY, UNLESS APPEALED TO THE COURT OF APPEALS UNDER 
166 
RULE 43 OF THE RULES OF CIVIL PROCEDURE. 
167 
 
168 
ART. 17. CERTIFICATE OF REGISTRATION. – x x x. 
169 
ART. 18. AMENDMENT OF ARTICLES OF COOPERATION AND BY-LAWS. 
170 
– x x x. 
171 
ART. 19. CONTRACTS EXECUTED PRIOR TO REGISTRATION AND 
172 
EFFECTS. – x x x. 
173 
ART. 20. DIVISION OF COOPERATIVES. – x x x. 
174 
ART. 21. MERGER AND CONSOLIDATION OF COOPERATIVES. – x x x. 
175 
ART. 22. EFFECTS AND MERGER AND CONSOLIDATION. – x x x. 
176 
ART. 23. TYPES AND CATEGORIES OF COOPERATIVES. – x x x. 
177 
(1) Types of Cooperatives – BASED ON THEIR BUSINESS 
178 
UNDERTAKINGS AND RELATED ACTIVITIES, cooperatives may fall 
179 
under any of the following types: 
180 
(a) [Credit Cooperative is one that promotes and 
181 
undertakes savings and lending services among its 
182 
members. It generates a common pool of fund in 
183 
order to provide financial assistance and other 
184 
related financial services to its members for 
185 
productive and provident purposes;] AGRICULTURAL 
186 
COOPERATIVES – COOPERATIVES WHOSE MEMBERSHIP 
187 


9 
 
 
CONSISTS 
OF 
INDIVIDUALS 
ENGAGED 
IN 
THE 
188 
AGRICULTURAL INDUSTRY, SUCH AS FARMERS AND 
189 
FISHERFOLK, AMONG OTHERS, AND WHOSE LINE OF 
190 
BUSINESS IS RELATED TO THE AGRICULTURAL VALUE 
191 
CHAIN, SUCH AS PRODUCING, PROCESSING, AND 
192 
MARKETING AGRICULTURAL PRODUCTS. AGRICULTURAL 
193 
COOPERATIVES INCLUDE: 
194 
i. 
AGRARIAN REFORM COOPERATIVE – ONE 
195 
ORGANIZED 
BY 
MARGINAL 
FARMERS, 
196 
MAJORITY 
OF 
WHICH 
ARE 
AGRARIAN 
197 
REFORM BENEFICIARIES, FOR THE PURPOSE 
198 
OF DEVELOPING AN APPROPRIATE SYSTEM 
199 
OF LAND TENURE, LAND DEVELOPMENT, 
200 
LAND 
CONSOLIDATION 
OR 
LAND 
201 
MANAGEMENT 
OF 
AREAS 
COVERED 
BY 
202 
AGRARIAN REFORM; 
203 
ii. 
DAIRY 
COOPERATIVE 
– 
ONE 
WHOSE 
204 
MEMBERS 
ARE 
ENGAGED 
IN 
THE 
205 
PRODUCTION AND MARKETING OF FRESH 
206 
MILK, WHICH MAY BE PROCESSED AND/OR 
207 
MARKETED AS DAIRY PRODUCTS; 
208 
iii. 
FARMERS COOPERATIVE – ORGANIZED BY 
209 
MARGINALIZED FARMERS FOR THE PURPOSE 
210 
OF SUPPORTING THEIR PRODUCTS, EITHER 
211 
FRESH OR PROCESSED; 
212 
iv. 
FISHERFOLK COOPERATIVE – ORGANIZED 
213 
BY 
MARGINALIZED 
FISHERFOLK 
WHOSE 
214 
PRODUCTS ARE MARKETED AS EITHER FRESH 
215 
OR PROCESSED, FOR THE MOBILIZATION OF 
216 
CAPITAL IN THE PROCUREMENT OF FISHING 
217 
BOATS, NETS, GEARS, AND ACCESSORIES, 
218 
FOR 
THE 
PRODUCTION 
OF 
AQUATIC 
219 
PRODUCTS, AND FOR ACCESS TO STORAGE 
220 


10 
 
 
AND AGRICULTURAL FACILITIES;  
221 
v. 
IRRIGATORS COOPERATIVE – ENGAGED IN 
222 
THE PROVISION OF IRRIGATION SERVICES 
223 
TO AGRICULTURAL LANDS; AND 
224 
vi. 
OTHERS, AS MAY BE DETERMINED BY THE 
225 
AUTHORITY IN CONSULTATION WITH THE 
226 
SECTOR. 
227 
 
228 
(b) [Consumers] 
COMMODITIES 
CooperativeS – 
229 
COOPERATIVES 
ENGAGED 
IN 
THE 
PROCESS 
OF 
230 
PRODUCING 
AND 
PROVIDING 
commodities 
to 
231 
members and[/or] non-members[;]. THESE MAY 
232 
INCLUDE: 
233 
i. 
CONSUMERS COOPERATIVE – HAS THE 
234 
PRIMARY PURPOSE OF PROCURING AND 
235 
DISTRIBUTING COMMODITIES TO MEMBERS 
236 
AND NON-MEMBERS; 
237 
ii. 
MARKETING COOPERATIVE – ENGAGES IN 
238 
THE SUPPLY OF PRODUCTION INPUTS TO 
239 
MEMBERS, AND MARKETS THEIR PRODUCTS, 
240 
INCLUDING TRADING AND PROCESSING;  
241 
iii. 
LOGISTICS COOPERATIVE – ENGAGES IN 
242 
OPERATIONS INVOLVING FACILITIES AND 
243 
SUPPLIES, THE BUSINESS OF WHICH IS 
244 
RELATED TO THE SUPPLY CHAIN;  
245 
iv. 
[c]Producers Cooperative – [is one that] 
246 
undertakes joint production whether 
247 
agricultural or industrial. It is formed and 
248 
operated by its members to undertake the 
249 
production 
and 
processing 
of 
raw 
250 
materials or goods produced by its 
251 
members into finished or processed 
252 
products for sale by the cooperative to its 
253 


11 
 
 
members and non-members. Any end 
254 
product or its derivative arising from the 
255 
raw materials produced by its members, 
256 
sold in the name and for the account of 
257 
the cooperative, shall be deemed a 
258 
product of the cooperative and its 
259 
members; AND 
260 
v. 
OTHERS, AS MAY BE DETERMINED BY THE 
261 
AUTHORITY IN CONSULTATION WITH THE 
262 
SECTOR. 
263 
 
264 
(c) EDUCATION 
AND 
ADVOCACY 
COOPERATIVES 
– 
265 
COOPERATIVES THAT ARE ENGAGED IN DEVELOPING AND 
266 
IMPROVING THE EDUCATION SECTOR, AND PROMOTING 
267 
AND ADVOCATING FOR THE COOPERATIVE AGENDA AND 
268 
ITS INTERESTS FOR THE ADVANCEMENT OF THE SECTOR 
269 
IN PARTICULAR AND THE COOPERATIVE MOVEMENT IN 
270 
GENERAL. THESE MAY INCLUDE: 
271 
i. 
ADVOCACY COOPERATIVE – PROMOTES AND 
272 
ADVOCATES 
COOPERATIVISM 
AND 
273 
ADVOCATES POLICIES FOR THE GENERAL 
274 
INTEREST AND WELFARE OF ITS MEMBERS, 
275 
THE SECTOR AND THE MOVEMENT, AND THE 
276 
PUBLIC 
THROUGH 
SOCIALLY-ORIENTED 
277 
PROJECTS, 
EDUCATION 
AND 
TRAINING, 
278 
RESEARCH 
AND 
COMMUNICATION, 
279 
CAMPAIGNS, 
LOBBYING, 
AND 
OTHER 
280 
SIMILAR ACTIVITIES TO REACH OUT TO ITS 
281 
INTENDED BENEFICIARIES; 
282 
ii. 
EDUCATION COOPERATIVE – ORGANIZED 
283 
FOR THE PRIMARY PURPOSE OF OWNING 
284 
AND OPERATING LICENSED EDUCATIONAL 
285 
INSTITUTIONS, 
NOTWITHSTANDING 
THE 
286 


12 
 
 
PROVISIONS 
OF 
R.A. 
NO. 
9155, 
287 
OTHERWISE KNOWN AS THE GOVERNANCE 
288 
OF BASIC EDUCATION ACT OF 2001; AND 
289 
iii. 
OTHERS, AS MAY BE DETERMINED BY THE 
290 
AUTHORITY IN CONSULTATION WITH THE 
291 
SECTOR. 
292 
 
293 
(d) [Marketing Cooperative is one which engages in 
294 
the supply of production inputs to members and 
295 
markets their products] FINANCE COOPERATIVES – 
296 
COOPERATIVES 
WHOSE 
PURPOSE 
IS 
TO 
EXTEND 
297 
FINANCIAL SERVICES TO ITS MEMBERS AND OTHER 
298 
COOPERATIVES, SUCH AS: 
299 
i. 
COOPERATIVE BANK – ORGANIZED FOR THE 
300 
PRIMARY PURPOSE OF PROVIDING A WIDE 
301 
RANGE 
OF 
FINANCIAL 
SERVICES 
TO 
302 
COOPERATIVES AND THEIR MEMBERS; 
303 
ii. 
CREDIT SURETY FUND COOPERATIVE – A 
304 
LOCAL 
GOVERNMENT 
UNIT 
(LGU)-
305 
PARTNERED COOPERATIVE COMPRISED OF 
306 
WELL-CAPITALIZED 
AND 
WELL-MANAGED 
307 
MEMBER-COOPERATIVES/NON-
308 
GOVERNMENT ORGANIZATIONS THAT MEET 
309 
THE 
CRITERIA 
AND 
QUALIFICATIONS 
310 
PRESCRIBED BY THE AUTHORITY, LGUS, 
311 
GOVERNMENT FINANCIAL INSTITUTIONS, 
312 
AND OTHER INSTITUTIONS/GOVERNMENT 
313 
AGENCIES; 
314 
iii. 
FINANCIAL 
SERVICE 
COOPERATIVE 
– 
315 
ORGANIZED FOR THE PRIMARY PURPOSE OF 
316 
ENGAGING 
IN 
SAVINGS 
AND 
CREDIT 
317 
SERVICES, AS WELL AS OTHER FINANCIAL 
318 
SERVICES; 
319 


13 
 
 
iv. 
INSURANCE COOPERATIVE – ENGAGED IN 
320 
THE BUSINESS OF INSURING THE LIFE AND 
321 
PROPERTY OF COOPERATIVES AND THEIR 
322 
MEMBERS;  
323 
v. 
SAVINGS AND CREDIT COOPERATIVE – 
324 
PROMOTES AND UNDERTAKES SAVINGS AND 
325 
LENDING SERVICES AMONG ITS MEMBERS. 
326 
IT GENERATES A COMMON POOL OF FUNDS IN 
327 
ORDER TO PROVIDE FINANCIAL ASSISTANCE 
328 
AND OTHER RELATED FINANCIAL SERVICES 
329 
TO ITS MEMBERS FOR PRODUCTIVE AND 
330 
PROVIDENT PURPOSES; AND 
331 
vi. 
OTHERS, AS MAY BE DETERMINED BY THE 
332 
AUTHORITY IN CONSULTATION WITH THE 
333 
SECTOR. 
334 
 
335 
(e) PUBLIC UTILITIES COOPERATIVES – COOPERATIVES 
336 
ENGAGED IN THE PROVISION OF PUBLIC UTILITIES TO 
337 
ITS MEMBERS OR THE PUBLIC, SUCH AS: 
338 
i. 
COMMUNICATIONS 
COOPERATIVE 
– 
339 
ORGANIZED 
TO 
OWN, 
OPERATE, 
AND 
340 
MANAGE 
COMMUNICATION 
STRUCTURES 
341 
AND ARRANGEMENTS, SUCH AS RADIO, 
342 
CABLE TV, NEWSPAPER, AND RELATED 
343 
INDUSTRIES, 
FOR 
THE 
WIDESPREAD 
344 
DISSEMINATION OF INFORMATION TO ITS 
345 
MEMBERS AND THE PUBLIC; 
346 
ii. 
ELECTRIC COOPERATIVE – ORGANIZED FOR 
347 
THE PRIMARY PURPOSE OF UNDERTAKING 
348 
POWER 
GENERATION, 
UTILIZING 
349 
RENEWABLE ENERGY SOURCES, INCLUDING 
350 
HYBRID 
SYSTEMS, 
ACQUISITION 
AND 
351 
OPERATION 
OF 
SUBTRANSMISSION 
OR 
352 


14 
 
 
DISTRIBUTION 
TO 
ITS 
HOUSEHOLD 
353 
MEMBERS; 
354 
iii. 
TRANSPORT COOPERATIVE – ONE WHICH 
355 
INCLUDES LAND AND SEA TRANSPORTATION, 
356 
LIMITED TO SMALL VESSELS, AS DEFINED OR 
357 
CLASSIFIED 
UNDER 
THE 
PHILIPPINE 
358 
MARITIME LAWS, OR IS ENGAGED IN THE 
359 
PROVISION OF RELATED OR AUXILIARY 
360 
SERVICES TO THE TRANSPORT INDUSTRY; 
361 
iv. 
WATER 
SERVICE 
COOPERATIVE 
– 
362 
ORGANIZED 
TO 
OWN, 
OPERATE, 
AND 
363 
MANAGE 
WATER 
SYSTEMS 
FOR 
THE 
364 
PROVISION AND DISTRIBUTION OF POTABLE 
365 
WATER 
TO 
ITS 
MEMBERS 
AND 
THEIR 
366 
HOUSEHOLDS; AND 
367 
v. 
OTHERS, AS MAY BE APPROVED BY THE 
368 
AUTHORITY IN CONSULTATION WITH THE 
369 
SECTOR. 
370 
 
371 
(f) Service CooperativeS [is one which is] – engage[s]D 
372 
IN THE PROVISION OF VARIOUS KINDS OF [in medical 
373 
and dental care, hospitalization, transportation, 
374 
insurance, housing, labor, electric light and power, 
375 
communication, professional and other] services TO 
376 
MEMBERS OR NON-MEMBERS, AS THE CASE MAY BE. 
377 
THESE MAY INCLUDE: 
378 
i. 
HEALTH 
SERVICES 
COOPERATIVE 
–
379 
ORGANIZED FOR THE PRIMARY PURPOSE OF 
380 
PROVIDING MEDICAL, DENTAL, PARAMEDIC, 
381 
DIAGNOSTIC, AND OTHER HEALTH SERVICES, 
382 
INCLUDING 
BUT 
NOT 
LIMITED 
TO 
383 
COOPERATIVE 
HEALTH 
ORGANIZATIONS, 
384 
HOSPITALS, CLINICS, PHARMACIES, AND 
385 


15 
 
 
TRANSPORTING OF PATIENTS; 
386 
ii. 
HOUSING 
SERVICES 
COOPERATIVE 
– 
387 
ORGANIZED TO ASSIST OR PROVIDE ACCESS 
388 
TO HOUSING FOR THE BENEFIT OF ITS 
389 
REGULAR 
MEMBERS 
WHO 
ACTIVELY 
390 
PARTICIPATE IN THE SAVINGS PROGRAM 
391 
FOR HOUSING. IT IS CO-OWNED AND 
392 
CONTROLLED BY ITS MEMBERS; 
393 
iii. 
LABOR SERVICES COOPERATIVE – ENGAGED 
394 
IN PROVIDING SPECIFIC SERVICES TO A 
395 
PRINCIPAL 
UNDER 
A 
LEGITIMATE 
396 
CONTRACTING 
OR 
SUBCONTRACTING 
397 
ARRANGEMENT, AS MAY BE DEFINED UNDER 
398 
EXISTING LAWS, AND IN ACCORDANCE WITH 
399 
THE COOPERATIVE PRINCIPLES SET FORTH 
400 
UNDER THIS CODE; 
401 
iv. 
PROFESSIONAL SERVICES COOPERATIVE – 
402 
ORGANIZED 
BY 
MEMBERS 
WHO 
ARE 
403 
ENGAGED IN PROVIDING PROFESSIONAL 
404 
SERVICES 
TO 
ITS MEMBERS 
OR NON-
405 
MEMBERS, AS THE CASE MAY BE. ITS 
406 
PRINCIPAL 
PURPOSE 
IS 
TO 
PROVIDE 
407 
EMPLOYMENT 
AND 
BUSINESS 
408 
OPPORTUNITIES TO ITS MEMBERS, AND 
409 
MANAGE 
IT 
IN 
ACCORDANCE 
WITH 
410 
COOPERATIVE PRINCIPLES; 
411 
v. 
REAL 
ESTATE 
DEVELOPMENT 
AND 
412 
PROPERTY MANAGEMENT COOPERATIVE – 
413 
ORGANIZED TO ENGAGE IN THE BUSINESS OF 
414 
DEVELOPING REAL ESTATE AND PROPERTY, 
415 
INCLUDING OFFERING THE PROPERTY FOR 
416 
SALE OR LEASE. IT IS ALSO ENGAGED IN 
417 
PROPERTY 
MANAGEMENT 
AND 
OTHER 
418 


16 
 
 
SERVICES 
PROVIDED 
BY 
A 
PROPERTY 
419 
MANAGER, AS STIPULATED IN R.A. NO. 
420 
9856; 
421 
vi. 
TECHNOLOGY SERVICE COOPERATIVE – 
422 
ORGANIZED TO PROVIDE ITS MEMBERS WITH 
423 
SERVICES 
THAT 
ARE 
DESIGNED 
TO 
424 
FACILITATE THE USE OF INFORMATION 
425 
TECHNOLOGY 
BY 
END-USERS, 
OR 
TO 
426 
PROVIDE 
SPECIALIZED 
TECHNOLOGY-
427 
ORIENTED SOLUTIONS BY COMBINING THE 
428 
PROCESSES AND FUNCTIONS OF SOFTWARE, 
429 
HARDWARE, 
NETWORKS, 
430 
TELECOMMUNICATIONS, AND ELECTRONICS, 
431 
AMONG OTHERS; 
432 
vii. 
WORKERS COOPERATIVE – ORGANIZED BY 
433 
WORKERS, INCLUDING THE SELF-EMPLOYED, 
434 
WHO ARE AT THE SAME TIME THE MEMBERS 
435 
AND OWNERS OF THE ENTERPRISE. ITS 
436 
PRINCIPAL 
PURPOSE 
IS 
TO 
PROVIDE 
437 
EMPLOYMENT 
AND 
BUSINESS 
438 
OPPORTUNITIES TO ITS MEMBERS, AND 
439 
MANAGE 
IT 
IN 
ACCORDANCE 
WITH 
440 
COOPERATIVE PRINCIPLES; AND 
441 
viii. 
OTHERS, AS MAY BE DETERMINED BY THE 
442 
AUTHORITY IN CONSULTATION WITH THE 
443 
SECTOR. 
444 
[(f) Multipurpose Cooperative is one which 
445 
combines two (2) or more of the business activities 
446 
of these different types of cooperatives; 
447 
(g) Advocacy Cooperative is a primary cooperative 
448 
which promotes and advocates cooperativism among 
449 
its members and the public through socially-oriented 
450 
projects, education and training, research and 
451 


17 
 
 
communication, and other similar activities to reach 
452 
out to its intended beneficiaries; 
453 
(h) Agrarian Reform Cooperative is one organized 
454 
by marginal farmers majority of which are agrarian 
455 
reform beneficiaries for the purpose of developing an 
456 
appropriate 
system 
of 
land 
tenure, 
land 
457 
development, 
land 
consolidation 
or 
land 
458 
management in areas covered by agrarian reform; 
459 
(i) Cooperative Bank is one organized for the primary 
460 
purpose of providing a wide range of financial 
461 
services to cooperatives and their members; 
462 
(j) Dairy Cooperative is one whose members are 
463 
engaged in the production of fresh milk which may 
464 
be processed and/or marketed as dairy products; 
465 
(k) Education Cooperative is one organized for the 
466 
primary purpose of owning and operating licensed 
467 
educational 
institutions 
notwithstanding 
the 
468 
provisions of Republic Act No. 9155, otherwise 
469 
known as the Governance of Basic Education Act of 
470 
2001; 
471 
(l) Electric Cooperative is one organized for the 
472 
primary purposed of undertaking power generations, 
473 
utilizing renewable energy sources, including hybrid 
474 
systems, 
acquisition 
and 
operation 
of 
475 
subtransmission or distribution to its household 
476 
members; 
477 
(m) Financial Service Cooperative is one organized 
478 
for the primary purpose of engaging in savings and 
479 
credit services and other financial services; 
480 
(n) Fishermen Cooperative is one organized by 
481 
marginalized fishermen in localities whose products 
482 
are marketed either as fresh or processed products; 
483 
(o) Health Services Cooperative is one organized 
484 


18 
 
 
for the primary purpose of providing medical, dental 
485 
and other health services; 
486 
(p) Housing Cooperative is one organized to assist 
487 
or provide access to housing for the benefit of its 
488 
regular members who actively participate in the 
489 
savings program for housing. It is co-owned and 
490 
controlled by its members; 
491 
(q) Insurance Cooperative is one engaged in the 
492 
business of insuring life and poverty of cooperatives 
493 
and their members; 
494 
(r) Transport Cooperative is one which includes land 
495 
and sea transportation, limited to small vessels, as 
496 
defined or classified under the Philippine maritime 
497 
laws, organized under the provisions of this Code; 
498 
(s) Water Service Cooperative is one organized to 
499 
own, operate and manage waters systems for the 
500 
provision and distribution of potable water for its 
501 
members and their households; 
502 
(t) Workers Cooperative is one organized by 
503 
workers, including the self-employed, who are at 
504 
same time the members and owners of the 
505 
enterprise. Its principal purpose is to provide 
506 
employment and business opportunities to its 
507 
members and manage it in accordance with 
508 
cooperative principles; and 
509 
(u) Other types of cooperative as may be determined 
510 
by the Authority.] 
511 
 
512 
(2) Categories of Cooperatives – Cooperatives shall be 
513 
categorized 
[according 
to 
membership 
and 
territorial 
514 
considerations] as follows: 
515 
(a) In terms of membership, cooperativeS shall be 
516 
categorized into: 
517 


19 
 
 
i. 
Primary – [T]The members of which are 
518 
natural persons; 
519 
ii. 
Secondary – [T]The members of which 
520 
are primar[ies]Y COOPERATIVES AND/OR 
521 
FEDERATIONS; AND 
522 
iii. 
[Tertiary – the members of which are 
523 
secondary cooperatives; and] APEX OF 
524 
COOPERATIVES – THE MEMBERS OF WHICH 
525 
SHALL INCLUDE ALL TYPES AND CATEGORIES 
526 
OF 
COOPERATIVES 
DULY-REGISTERED 
527 
UNDER THIS CODE. 
528 
(b) IN TERMS OF BUSINESS, COOPERATIVES SHALL BE 
529 
CLASSIFIED INTO: 
530 
i. 
SINGLE-PURPOSE – COOPERATIVES WITH 
531 
ONE MAIN LINE OF BUSINESS OR PURPOSE, 
532 
WHICH SHALL INCLUDE UNDERTAKINGS OR 
533 
ACTIVITIES RELATED TO SUCH BUSINESS OR 
534 
PURPOSE; AND 
535 
ii. 
MULTI-PURPOSE 
– 
COOPERATIVES 
536 
ENGAGED IN TWO (2) OR MORE SEPARATE 
537 
AND DISTINCT LINES OF BUSINESS. 
538 
 
539 
(c) IN TERMS OF ASSETS, COOPERATIVES SHALL BE 
540 
CLASSIFIED INTO: 
541 
i. 
MICRO – 
COOPERATIVES 
WITH 
TOTAL 
542 
ASSETS UP TO THREE MILLION PESOS 
543 
(P3,000,000.00); 
544 
ii. 
SMALL – 
COOPERATIVES 
WITH 
TOTAL 
545 
ASSETS GREATER THAN P3,000,000.00 TO 
546 
FIFTEEN 
MILLION 
PESOS 
547 
(P15,000,000.00); 
548 
iii. 
MEDIUM – COOPERATIVES WITH TOTAL 
549 
ASSETS GREATER THAN P15,000,000.00 
550 


20 
 
 
TO 
ONE 
HUNDRED 
MILLION 
PESOS 
551 
(P100,000,000.00); AND 
552 
iv. 
LARGE – 
COOPERATIVES 
WITH 
TOTAL 
553 
ASSETS 
GREATER 
THAN 
554 
P100,000,000.00. 
555 
 
556 
(d) In terms of territory, cooperatives shall be 
557 
categorized according to areas of operation[s], 
558 
which may or may not coincide with the political 
559 
subdivisions of the country. 
560 
 
561 
ART. 24. FUNCTIONS OF A FEDERATION OF COOPERATIVES. – A 
562 
federation of cooperatives shall undertake the following 
563 
functions: 
564 
(a) x x x 
565 
(b) x x x 
566 
(c) x x x 
567 
(d) x x x 
568 
(e) x x x 
569 
(f) x x x 
570 
(g) x x x 
571 
 
572 
A federation of cooperatives may be registered by carrying 
573 
out the formalities for registration of a cooperative. 
574 
 
575 
Registered cooperatives may organize OR JOIN a federation 
576 
[according to the type of business activity engaged in by other 
577 
cooperatives] THAT IS ESSENTIAL TO THEIR BUSINESS OPERATIONS. 
578 
 
579 
ART. 24-A. MEMBERSHIP OF FOREIGN COOPERATIVES IN 
580 
FEDERATIONS. – FOREIGN COOPERATIVES MAY INVEST, PARTNER 
581 
WITH, OR BECOME MEMBERS OF FEDERATIONS, PROVIDED, THAT 
582 
THEY 
ARE RECOGNIZED 
BY 
INTERNATIONAL 
COALITIONS OF 
583 


21 
 
 
COOPERATIVES OR BY THE RELEVANT AUTHORITY IN THEIR COUNTRY 
584 
OF ORIGIN, AS WELL AS REGISTERED WITH THE AUTHORITY; AND 
585 
PROVIDED, FURTHER, THAT THEY COMPLY WITH ALL RELEVANT LAWS 
586 
ALLOWING THEM TO DO BUSINESS IN THE PHILIPPINES. THE DETAILS 
587 
OF THEIR INVESTMENT, PARTICIPATION, OR MEMBERSHIP SHALL BE 
588 
LEFT TO THE DISCRETION OF THE LOCAL FEDERATION. FURTHER 
589 
DETAILS SHALL BE LAID DOWN IN THE IMPLEMENTING RULES AND 
590 
REGULATIONS (IRR) OF THIS CODE. 
591 
 
592 
FOREIGN COOPERATIVES WHO SHALL TRANSACT WITH LOCAL 
593 
FEDERATIONS MUST COMPLY WITH PHILIPPINE TAXATION LAWS. 
594 
 
595 
ART. 25. COOPERATIVE UNIONS. – x x x.” 
596 
 
597 
Section 3. Article 26 of Chapter III on Membership of the same Code, is 
598 
hereby further amended to read as follows: 
599 
 
600 
“ART. 26. KINDS OF MEMBERSHIP. – A cooperative may have 
601 
two (2) kinds of members, to wit: (1) regular members and (2) 
602 
associate members. 
603 
 
604 
A regular member is one who has complied with all the 
605 
membership requirements and entitled to all the rights and 
606 
privileges of membership. An associate member is one who has 
607 
no right to vote nor be voted upon and shall be entitled only to 
608 
such rights and privileges as the bylaws may provide:  Provided, 
609 
That an associate member who meets ALL [the minimum] 
610 
requirements of regular membership, continues to patronize the 
611 
cooperative for two (2) years, and signifies his/her intention to 
612 
remain a member shall be considered a regular member. 
613 
 
614 
HOWEVER, IN THE CASE OF FORMER NATURAL-BORN FILIPINO 
615 
CITIZENS WHO ARE ASSOCIATE MEMBERS, THEIR ELEVATION TO 
616 


22 
 
 
REGULAR MEMBERSHIP SHALL BE LEFT TO THE BY-LAWS OF THE 
617 
INDIVIDUAL COOPERATIVES. 
618 
 
619 
A cooperative organized by minors shall be considered a 
620 
laboratory cooperative and must be affiliated with a registered 
621 
cooperative. A laboratory cooperative shall be governed by 
622 
special guidelines to be promulgated by the Authority. 
623 
 
624 
ART. 27. GOVERNMENT OFFICERS AND EMPLOYEES. –  x x x. 
625 
ART. 28. APPLICATION. –  x x x. 
626 
ART. 29. LIABILITY OF MEMBERS. –  x x x. 
627 
ART. 30. TERMINATION OF MEMBERSHIP. –  x x x. 
628 
ART. 31. REFUND OF INTERESTS. –  x x x.” 
629 
 
630 
Section 4. Articles 35, 36, 37, 39, and 40 of Chapter IV on Administration 
631 
of the same Code, are hereby further amended to read as follows: 
632 
 
633 
“ART. 32. COMPOSITION OF THE GENERAL ASSEMBLY. –  x x x. 
634 
ART. 33. POWERS OF THE GENERAL ASSEMBLY. –  x x x. 
635 
ART. 34. MEETINGS. –  x x x. 
636 
ART. 35. QUORUM. –  x x x. A quorum shall consist of at least 
637 
twenty-five per centum (25%) of all the members entitled to 
638 
vote.  
639 
 
640 
In THE case of cooperative banks, the quorum shall be as 
641 
provided in Article 99 of this Code. In the case of electric 
642 
cooperatives, a quorum, unless otherwise provided FOR in the 
643 
by-laws, shall consist of five per centum (5%) of all the members 
644 
entitled to vote. 
645 
 
646 
THE ANNUAL GENERAL ASSEMBLY MEETING MAY BE CONDUCTED 
647 
THROUGH A FACE TO FACE OR VIRTUAL MEETING, OR A COMBINATION 
648 
OF BOTH, SUBJECT TO THE RULES ON THE SENDING OF NOTICES, AS 
649 


23 
 
 
PROVIDED IN THE COOPERATIVE’S BY-LAWS. 
650 
 
651 
ART. 36. VOTING SYSTEM. –  Each member of a primary 
652 
cooperative shall have only one (1) vote. In the case of members 
653 
of [secondary or tertiary cooperatives] cooperative federations, 
654 
SHALL PROVIDE IN THEIR BY-LAWS WHETHER TO IMPLEMENT 
655 
INCENTIVE VOTING OR SHARE VOTING.  
656 
 
657 
IN THE CASE OF INCENTIVE VOTING, MEMBER-COOPERATIVES 
658 
shall have one (1) basic vote and as many incentive votes as 
659 
provided for in the by-laws, [but not to] WHICH IN NO CASE shall 
660 
exceed five (5) votes.  
661 
 
662 
IN THE CASE OF SHARE VOTING, THE VOTING RIGHTS OF THE 
663 
MEMBER-COOPERATIVES SHALL BE PROPORTIONATE TO THE NUMBER 
664 
OF THEIR PAID-UP SHARES, SUBJECT TO THE LIMITATION IMPOSED 
665 
UNDER ART. 73, AND PROVIDED, THAT AT LEAST ONE-THIRD (1/3) 
666 
OF THE SEATS IN THE BOARD SHALL BE RESERVED FOR SMALL 
667 
SHAREHOLDERS. The votes cast by the delegates shall be deemed 
668 
as votes cast by the members thereof. 
669 
 
670 
[However, the bylaws of a cooperative other than a primary 
671 
may provide for voting by proxy. Voting by proxy means allowing 
672 
a delegate of a cooperative to represent or vote in behalf of 
673 
another delegate of the same cooperative.] 
674 
 
675 
ART. 37. COMPOSITION AND TERM OF BOARD OF DIRECTORS. –  
676 
Unless otherwise provided in the bylaws, the direction and 
677 
management of the affairs of a cooperative shall be vested in a 
678 
board of directors which shall be composed of not less than five 
679 
(5) nor more than fifteen (15) members elected by the general 
680 
assembly for a term fixed in the bylaws but not exceeding a term 
681 
of two (2) years and shall hold office until their successors are 
682 


24 
 
 
duly elected and qualified, or until duly removed for cause. 
683 
 
684 
FOR COOPERATIVE FEDERATIONS, A MEMBER-COOPERATIVE 
685 
SHALL HAVE ONLY ONE REPRESENTATIVE ELIGIBLE TO RUN AND BE 
686 
VOTED UPON AS DIRECTOR, IRRESPECTIVE OF THE MEMBER-
687 
COOPERATIVE’S SHARE CAPITAL HOLDINGS UNDER THE THIRD 
688 
PARAGRAPH OF ART. 73. 
689 
ART. 38. POWERS OF THE BOARD OF DIRECTORS. –  x x x. 
690 
 
691 
ART. 39. DIRECTORS. –  (1) Any member of a cooperative 
692 
who, under the bylaws of the cooperative, has the right to vote 
693 
and who possesses all the qualifications and none of the 
694 
disqualifications provided in the laws or the bylaws shall be 
695 
eligible for election as director, SUBJECT TO THE LIMITATION 
696 
IMPOSED BY THE SECOND PARAGRAPH OF ART. 37. 
697 
(2) x x x 
698 
(3) x x x 
699 
(4) x x x 
700 
 
701 
ART. 40. MEETING OF THE BOARD OF DIRECTORS AND QUORUM 
702 
REQUIREMENT. –   (1) x x x 
703 
(2) x x x 
704 
(3) x x x 
705 
(4) EACH DIRECTOR SHALL ONLY HAVE ONE VOTE IN THE 
706 
BOARD, WHETHER IT BE A PRIMARY COOPERATIVE OR A COOPERATIVE 
707 
FEDERATION, IRRESPECTIVE OF THE MEMBER-COOPERATIVE’S SHARE 
708 
CAPITAL HOLDINGS UNDER THE THIRD PARAGRAPH OF ART. 73. 
709 
(5)  x x x 
710 
 
711 
ART. 41. VACANCY IN THE BOARD OF DIRECTORS. –  x x x. 
712 
ART. 42. OFFICERS OF THE COOPERATIVE. –  x x x. 
713 
ART. 43. COMMITTEES OF COOPERATIVES. –  x x x. 
714 
ART. 
44. 
FUNCTIONS, 
RESPONSIBILITIES 
AND 
TRAINING 
715 


25 
 
 
REQUIREMENTS OF DIRECTORS, OFFICERS AND COMMITTEE MEMBERS. –  x 
716 
x x. 
717 
ART. 44-A. MANDATORY TRAINING AND ACCREDITATION OF 
718 
TRAINING SERVICE PROVIDERS. –  IT SHALL BE MANDATORY FOR ALL 
719 
COOPERATIVES TO PROVIDE TRAINING FOR THEIR OFFICERS AND 
720 
MEMBERS FOR THEIR CONTINUED DEVELOPMENT AND PERSONAL 
721 
IMPROVEMENT. IN THIS REGARD, ONLY COOPERATIVES MAY BE 
722 
ACCREDITED BY THE AUTHORITY AS TRAINING SERVICE PROVIDERS 
723 
(TSPS). IN THE EVENT THAT THE COOPERATIVE IS UNABLE TO 
724 
PROVIDE SUCH TRAINING ON ITS OWN, IT MAY ENGAGE THE SERVICES 
725 
OF A FEDERATION OR UNION DULY ACCREDITED BY THE AUTHORITY 
726 
AS A TSP; PROVIDED, THAT A FEDERATION SHALL ONLY PROVIDE 
727 
TRAINING IN ACCORDANCE WITH ITS BUSINESS OR SPECIALIZATION 
728 
A UNION SHALL PROVIDE BASIC AND OTHER TRAINING THAT 
729 
BENEFITS THE SECTOR; PROVIDED, FURTHER, THAT NOTHING 
730 
PRECLUDES FEDERATIONS FROM OFFERING BASIC AND OTHER 
731 
TRAINING 
PROGRAMS 
TO 
THEIR 
MEMBERS, 
OR 
FROM 
732 
COLLABORATING WITH UNIONS AND OTHER FEDERATIONS IN THIS 
733 
REGARD. 
734 
 
735 
UPON THE EFFECTIVITY OF THIS ACT, THE AUTHORITY SHALL 
736 
CEASE TO ACCREDIT NON-COOPERATIVE ORGANIZATIONS AS TSPS. 
737 
 
738 
ART. 45. LIABILITY OF DIRECTORS, OFFICERS, AND COMMITTEE 
739 
MEMBERS. –  x x x. 
740 
ART. 46. COMPENSATION. –  x x x. 
741 
ART. 47. DEALINGS OF DIRECTORS, OFFICERS OR COMMITTEE 
742 
MEMBERS. –  x x x. 
743 
ART. 48. DISLOYALTY OF A DIRECTOR. –  x x x. 
744 
ART. 42. ILLEGAL USE OF CONFIDENTIAL INFORMATION. –  x x x. 
745 
ART. 43. REMOVAL. –  x x x.” 
746 
 
747 
Section 5. Articles 58, 60, 61, and 62 of Chapter V on Responsibilities, 
748 


26 
 
 
Rights and Privileges of Cooperatives of the same Code, are hereby further 
749 
amended to read as follows: 
750 
 
751 
“ART. 51. ADDRESS. –  x x x. 
752 
ART. 52. BOOKS TO BE KEPT OPEN. –  x x x. 
753 
ART. 53. REPORTS. –  x x x. 
754 
ART. 54. REGISTER OF MEMBERS AS PRIMA FACIE EVIDENCE. –  x x 
755 
x. 
756 
ART. 55. PROBATIVE VALUE OF CERTIFIED COPIES OF ENTRIES. –  x 
757 
x x. 
758 
ART. 56. BONDING OF ACCOUNABLE OFFICERS. –  x x x. 
759 
ART. 57. PREFERENCE OF CLAIMS. –  x x x. 
760 
ART. 58. INSTRUMENT FOR SALARY OR WAGE DEDUCTION. –  (1) A 
761 
member of a cooperative may, notwithstanding the provisions of 
762 
existing laws to the contrary, execute an instrument in favor of 
763 
the cooperative authorizing his employer to deduct from his/her 
764 
salary or wages, commutation of leave credits, and any other 
765 
monetary benefits payable to him by the employer and remit 
766 
such amount as may be specified 
AS 
SAID 
MEMBER’S 
767 
CONTRIBUTION TO THE CAPITAL OF THE COOPERATIVE, OR in 
768 
satisfaction of a debt or other demand due from the member to 
769 
the cooperative. 
770 
(2) x x x 
771 
(3) x x x 
772 
(4) x x x 
773 
(5) x x x 
774 
(6) THE MEMBER MAY WITHDRAW SUCH CONSENT AT ANY TIME 
775 
AND FOR ANY REASON, WHICH SHALL ALSO BE PUT IN WRITING. ANY 
776 
PERSON WHO ACTS CONTRARY TO THIS PROVISION SHALL BE HELD 
777 
LIABLE UNDER THIS CODE AND OTHER LAWS, AS THE CASE MAY BE. 
778 
 
779 
ART. 59. PRIMARY LIEN. –  x x x. 
780 
ART. 60. TAX TREATMENT OF COOPERATIVES AND COOPERATIVE 
781 


27 
 
 
MEMBERS’ BENEFITS FROM COOPERATIVES. –  Duly registered 
782 
cooperatives under this Code which do not transact any business 
783 
with non-members or the general public shall not be subject to 
784 
any taxes and fees imposed under the internal revenue laws and 
785 
other tax laws. Cooperatives not falling under this article shall be 
786 
governed by the succeeding section. 
787 
PATRONAGE REFUNDS AND INTEREST ON SHARE CAPITAL 
788 
DISTRIBUTED BY THE COOPERATIVE TO ITS MEMBERS, AND INTEREST 
789 
ON MEMBERS' DEPOSITS SHALL LIKEWISE NOT BE SUBJECT TO ANY 
790 
TAX AND FEES IMPOSED UNDER THE INTERNAL REVENUE LAWS AND 
791 
OTHER TAX LAWS. 
792 
 
793 
ART. 60-A. CERTIFICATE OF TAX EXEMPTION. –  THE BUREAU 
794 
OF INTERNAL REVENUE (BIR) SHALL IMMEDIATELY ISSUE THE 
795 
CERTIFICATE OF TAX EXEMPTION (CTE) UPON SUBMISSION, UNDER 
796 
OATH BY WAY OF AN AFFIDAVIT, OF THE FOLLOWING DOCUMENTS: 
797 
a. COOPERATIVE CERTIFICATE OF COMPLIANCE; 
798 
b. REGISTRATION CERTIFICATE; 
799 
c. ARTICLES OF COOPERATION AND BY-LAWS; AND 
800 
d. PRECEDING 
YEAR’S 
FINANCIAL 
STATEMENTS, 
DULY 
801 
CERTIFIED 
BY 
A 
LICENSED 
CERTIFIED 
PUBLIC 
802 
ACCOUNTANT. 
803 
 
804 
IN 
NO 
CASE 
SHALL 
THE 
SUBMISSION 
OF 
THE TAX 
805 
IDENTIFICATION NUMBERS OF THE MEMBERS BE REQUIRED AS A 
806 
CONDITION FOR THE ISSUANCE OF THE CTE. 
807 
 
808 
ART. 61. TAX AND OTHER EXEMPTIONS. –  Cooperatives 
809 
transacting business with both members and non-members shall 
810 
not be subject to tax on their transactions with members. In 
811 
relation to this, the transactions of members with the cooperative 
812 
shall not be subject to any taxes and fees, including but not 
813 
limited to final taxes on members’ deposits and documentary 
814 


28 
 
 
STAMP tax. Notwithstanding the provisions of any law or 
815 
regulation to the contrary, such cooperatives dealing with non-
816 
members shall enjoy the following tax exemptions: 
817 
(1) Cooperatives [with accumulated reserves and undivided 
818 
net savings of not more than Ten million pesos (P10,000,000.00) 
819 
shall be] ARE exempt from all national, city, provincial, municipal 
820 
or barangay taxes of whatever name and nature. Such 
821 
cooperatives [shall be] ARE exempt from customs duties, 
822 
advance sales or compensating taxes on their importation of 
823 
machineries, equipment and spare parts used by them and which 
824 
are not available locally as certified by the Department of Trade 
825 
and Industry (DTI). COOPERATIVES ARE ALSO EXEMPT FROM ANY 
826 
TAX ON LOCALLY PURCHASED MACHINERIES, EQUIPMENT, AND SPARE 
827 
PARTS. ALL TAX-FREE IMPORTATIONS AND THOSE PURCHASED LOCALLY 
828 
shall not be sold nor the beneficial ownership thereof be 
829 
transferred to any person until after five (5) years, otherwise, the 
830 
cooperative and the transferee or assignee shall be solidarily 
831 
liable to pay twice the amount of the imposed tax and/or duties. 
832 
 
833 
[(2) Cooperatives with accumulated reserves and undivided 
834 
net savings of more than Ten million pesos (P10,000,000.00) 
835 
shall fee the following taxes at the full rate: 
836 
 
837 
(a) Income Tax – On the amount allocated for interest on 
838 
capitals: Provided, That the same tax is not consequently 
839 
imposed on interest individually received by members: Provided, 
840 
further, That cooperatives regardless of classification, are 
841 
exempt income tax from the date of registration with the 
842 
Authority; 
843 
 
844 
(b) Value-Added Tax On transactions with non-members: 
845 
Provided, however, That cooperatives duly registered with the 
846 
Authority; are exempt from the payment of value-added tax; 
847 


29 
 
 
subject to Sec. 109, sub-sections L, M and N of Republic Act No. 
848 
9337, the National Internal Revenue Code, as amended: 
849 
Provided, That the exempt transaction under Sec. 109 (L) shall 
850 
include sales made by cooperatives duly registered with the 
851 
Authority organized and operated by its member to undertake 
852 
the production and processing of raw materials or of goods 
853 
produced by its members into finished or process products for 
854 
sale by the cooperative to its members and non-members: 
855 
Provided, further, That any processed product or its derivative 
856 
arising from the raw materials produced by its members, sold in 
857 
then name and for the account of the cooperative: Provided , 
858 
finally, That at least twenty-five per centum (25%) of the net 
859 
income of the cooperatives is returned to the members in the 
860 
form of interest and/or patronage refunds; 
861 
 
862 
(c) All other taxes unless otherwise provided herein; and 
863 
 
864 
(d) Donations to charitable, research and educational 
865 
institutions and reinvestment to socioeconomic projects within 
866 
the area of operation of the cooperative may be tax deductible.] 
867 
 
868 
(2) All cooperatives[, regardless of the amount of 
869 
accumulated reserves and undivided net savings shall be] ARE 
870 
exempt from payment of local taxes and taxes on transactions 
871 
with banks and insurance companies:  Provided, That all sales or 
872 
services rendered for non-members shall be subject to the 
873 
applicable percentage taxes except sales made by producers, 
874 
marketing or service cooperatives:  Provided, further, That 
875 
nothing in this article shall preclude the examination of the books 
876 
of accounts or other accounting records of the cooperative by 
877 
duly authorized internal revenue officers for internal revenue tax 
878 
purposes only, after previous authorization by the Authority. 
879 
 
880 


30 
 
 
(3) In areas where there are no available notaries public, 
881 
the judge, exercising his ex officio capacity as notary public, shall 
882 
render service, free of charge, to any person or group of persons 
883 
requiring the administration of oath or the acknowledgment of 
884 
articles of cooperation and instruments of loan from cooperatives 
885 
not 
exceeding 
Five 
[h]Hundred 
[t]Thousand 
[p]Pesos 
886 
(P500,000.00). 
887 
 
888 
(4) Any register of deeds shall accept for registration, free 
889 
of charge, any instrument relative to a loan made under this Code 
890 
which does not exceed Two [h]Hundred 
AND [f]Fifty 
891 
[t]Thousand [p]Pesos (P250,000.00) or the deeds of title of any 
892 
property acquired by the cooperative or any paper or document 
893 
drawn in connection with any action brought by the cooperative 
894 
or with any court judgment rendered in its favor or any 
895 
instrument relative to a bond of any accountable officer of a 
896 
cooperative for the faithful performance of his duties and 
897 
obligations. 
898 
 
899 
(5) Cooperatives shall be exempt from the payment of all 
900 
court and sheriff’s fees payable to the Philippine Government for 
901 
and in connection with all actions brought under this Code, or 
902 
where such actions [is] ARE brought by the Authority before the 
903 
court, to enforce the payment of obligations contracted in favor 
904 
of the cooperative. 
905 
 
906 
(6) All cooperatives shall be exempt from putting up a bond 
907 
for bringing an appeal against the decision of an inferior court or 
908 
for seeking to set aside any third party claim:  Provided, That a 
909 
certification of the Authority showing that the net assets of the 
910 
cooperative are in excess of the amount of the bond required by 
911 
the court in similar cases shall be accepted by the court as a 
912 
sufficient bond. 
913 


31 
 
 
 
914 
(7) Any security issued by cooperatives shall be exempt 
915 
from the provisions of the Securities Act provided such security 
916 
shall not be speculative. 
917 
 
918 
 
919 
ART. 62. PRIVILEGES OF COOPERATIVES. –  Cooperatives 
920 
registered under this Code shall, notwithstanding the provisions 
921 
of any law to the contrary, SHALL ALSO be [also] accorded the 
922 
following privileges: 
923 
(1) x x x 
924 
(2) x x x 
925 
(3) x x x 
926 
(4) x x x 
927 
(5) x x x 
928 
(6) x x x 
929 
(7) x x x 
930 
(8) x x x 
931 
(9) x x x 
932 
(10) 
Cooperatives 
[transacting 
business 
with 
the 
933 
Government of the Philippines or any of its political subdivisions 
934 
or any of its agencies or instrumentalities, including government-
935 
owned and controlled corporations shall be exempt from 
936 
prequalification bidding requirements, notwithstanding the 
937 
provisions of Republic Act No. 9184, otherwise known as, the 
938 
Government Procurement Act] SHALL BE CONSIDERED AS A 
939 
SPECIAL CLASS OF BIDDERS UNDER R.A. NO. 9184, OR THE 
940 
GOVERNMENT PROCUREMENT REFORMATION ACT (GPRA), WHO 
941 
SHALL BE PREFERRED IN THE PROCUREMENT OF GOVERNMENT 
942 
PROJECTS, PROVIDED, THAT THEY ARE QUALIFIED TO PERFORM THE 
943 
SERVICES NEEDED AND FULLY COMPLY WITH THE PROCUREMENT 
944 
PROCESS UNDER THE LAW. 
945 
 
946 


32 
 
 
TAKING INTO CONSIDERATION THE SPECIAL NATURE OF 
947 
COOPERATIVES AND THE PUBLIC POLICY OF SUPPORTING THE 
948 
COOPERATIVE 
MOVEMENT, 
GOVERNMENT 
EMPLOYEES’ 
949 
COOPERATIVES SHALL NOT BE DISQUALIFIED FROM PARTICIPATING 
950 
IN PROCUREMENT PROJECTS WITHIN THEIR MOTHER AGENCIES, AS 
951 
LONG AS THEY ARE QUALIFIED TO PROVIDE SUCH SERVICES. 
952 
 
953 
FURTHER, IN RELATION TO SECTIONS 43 AND 48 OF R.A. NO. 
954 
9184, AS MAY BE APPLICABLE, REGARDING THE PURCHASE OF 
955 
DOMESTICALLY-PRODUCED AND MANUFACTURED GOODS, SUPPLIES, 
956 
AND MATERIALS, THE PROCURING ENTITY SHALL GIVE FURTHER 
957 
PREFERENCE TO DULY REGISTERED COOPERATIVES UNDER THIS 
958 
CODE; PROVIDED, THAT THE COOPERATIVE MEETS THE ELIGIBILITY 
959 
REQUIREMENTS OF THE PROCURING ENTITY, AS WELL AS THE 
960 
QUALITY AND QUANTITY REQUIRED FOR SUCH PROCUREMENT; 
961 
(11) x x x 
962 
(12) x x x 
963 
(13) x x x 
964 
(14) THE RELEVANT REGULATORY BODIES, GOVERNMENT 
965 
AGENCIES, AND LGUS SHALL NOT DISCRIMINATE AGAINST DULY 
966 
REGISTERED COOPERATIVES SEEKING ACCREDITATION AS SERVICE 
967 
PROVIDERS, OR SEEKING TO ENGAGE IN A PARTICULAR BUSINESS, 
968 
PROVIDED, THAT THEY POSSESS ALL OTHER QUALIFICATIONS UNDER 
969 
THE LAW. 
970 
 
971 
ANY PERSON WHO ACTS CONTRARY TO THIS PROVISION MAY BE 
972 
HELD LIABLE UNDER THIS CODE AND ALL OTHER RELEVANT LAWS AND 
973 
ISSUANCES; AND 
974 
 
975 
(15) COOPERATIVES SHALL HAVE THE RIGHT TO EFFECTIVE 
976 
AND 
REASONABLE 
PARTICIPATION 
IN 
DECISION-MAKING 
977 
PROCESSES, INCLUDING REPRESENTATION IN THE GOVERNMENT.” 
978 
 
979 


33 
 
 
Section 6. Article 67 of Chapter VII on Dissolution of Cooperatives of the 
980 
same Code, is hereby further amended to read as follows: 
981 
 
982 
“ART. 64. VOLUNTARY DISSOLUTION WHERE NO CREDITORS ARE 
983 
AFFECTED. –  x x x. 
984 
ART. 65. VOLUNTARY DISSOLUTION WHERE CREDITORS ARE 
985 
AFFECTED. –  x x x. 
986 
ART. 66. INVOLUNTARY DISSOLUTION. –  x x x. 
987 
ART. 67. DISSOLUTION BY ORDER OF THE AUTHORITY. –  The 
988 
Authority may suspend or revoke, after due notice and hearing, 
989 
the certificate of registration of a cooperative on any of the 
990 
following grounds: 
991 
(1) x x x 
992 
(2) x x x 
993 
(3) x x x 
994 
(4) x x x 
995 
(5) x x x 
996 
 
997 
THE DECISION OF THE AUTHORITY ON THE SUSPENSION OR 
998 
REVOCATION OF THE CERTIFICATE OF REGISTRATION OF A 
999 
COOPERATIVE MAY BE APPEALED TO THE OFFICE OF THE SECRETARY 
1000 
OF THE DTI WITHIN THIRTY (30) DAYS FROM THE RECEIPT OF THE 
1001 
ORDER OF THE AUTHORITY. THE DECISION OF THE DTI SECRETARY 
1002 
IS FINAL AND EXECUTORY. 
1003 
 
1004 
ART. 68. DISSOLUTION BY FAILURE TO ORGANIZE AND OPERATE. –  
1005 
x x x. 
1006 
ART. 69. LIQUIDATION OF A COOPERATIVE. –  x x x. 
1007 
ART. 70. RULES AND REGULATIONS ON LIQUIDATION. –  x x x.” 
1008 
 
1009 
Section 7. Articles 72, 73, and 75 of Chapter VIII on Capital, Property, and 
1010 
Funds of the same Code, are hereby further amended to read as follows: 
1011 
 
1012 


34 
 
 
“ART. 71. CAPITAL. –  x x x. 
1013 
ART. 72. CAPITAL SOURCES. –  Cooperatives registered under 
1014 
this Code may derive their capital from any or all of the following 
1015 
sources: 
1016 
(1) Members’ share capital 
1017 
(2) Loans and borrowings including deposits 
FROM 
1018 
MEMBERS; 
1019 
(3) x x x 
1020 
(4) x x x 
1021 
 
1022 
Upon dissolution, such donated capital shall be subject to 
1023 
escheat. 
1024 
 
1025 
ART. 73. LIMITATIONS ON SHARE CAPITAL HOLDINGS. –  No 
1026 
member of a primary cooperative other than a cooperative itself 
1027 
shall own or hold more than ten per centum (10%) of the share 
1028 
capital of the cooperative. 
1029 
Where a member of a cooperative dies, his heir shall be 
1030 
entitled to the shares of the decedent:  Provided, That the total 
1031 
shareholdingS of the heir does not exceed ten per centum (10%) 
1032 
of the share capital of the cooperative:  Provided, further, That 
1033 
the heir qualif[y]IES and is admitted as A member of the 
1034 
cooperative:  Provided, finally, That where the heir fails to qualify 
1035 
as a member or where his total shareholdingS exceed[s] ten per 
1036 
centum (10%) of the share capital, the share or shares in excess 
1037 
will revert to the cooperative upon payment to the heir of the 
1038 
value of such shares. 
1039 
FOR ALL COOPERATIVE FEDERATIONS, THE SHARE CAPITAL 
1040 
HOLDINGS OF ANY MEMBER SHALL NOT EXCEED FORTY PERCENT 
1041 
(40%) OF THE SUBSCRIBED SHARE CAPITAL OF THE COOPERATIVE 
1042 
FEDERATION. 
1043 
 
1044 
ART. 74. ASSIGNMENT OF SHARE CAPITAL CONTRIBUTION OR 
1045 


35 
 
 
INTEREST –  x x x. 
1046 
ART. 75. CAPITAL BUILD-UP. –  The by-laws of every 
1047 
cooperative shall [provide for] REQUIRE a reasonable and realistic 
1048 
capital build-up AND/OR DEPOSITS BUILD-UP program to allow the 
1049 
continuing growth of the members’ investment AND SAVINGS 
1050 
DEPOSITS in their cooperative as their own economic conditions 
1051 
continue to improve. 
1052 
 
1053 
ART. 76. SHARES. –  X X X. 
1054 
ART. 77. FINES. –  X X X. 
1055 
ART. 78. INVESTMENT OF CAPITAL. –  X X X. 
1056 
ART. 79. REVOLVING CAPITAL. –  X X X.” 
1057 
 
1058 
Section 8. Article 86 of Chapter X on Allocation and Distribution of Net 
1059 
Surplus of the same Code, is hereby further amended to read as follows: 
1060 
 
1061 
“ART. 85. NET SURPLUS. –  x x x. 
1062 
ART. 86. ORDER OF DISTRIBUTION. –  The net surplus of every 
1063 
cooperative shall be distributed as follows: 
1064 
 
1065 
(1) An amount for the reserve fund which shall be at least 
1066 
ten per centum (10%) of net surplus:  Provided, THAT LARGE 
1067 
COOPERATIVES MUST SECURE ONE HUNDRED PER CENTUM (100%) 
1068 
OF THEIR RESERVE FUNDS IN DEPOSIT INSTRUMENTS, AT LEAST 
1069 
EIGHTY PER CENTUM (80%) FOR MEDIUM COOPERATIVES, AND AT 
1070 
LEAST FIFTY PER CENTUM (50%) FOR MICRO AND SMALL 
1071 
COOPERATIVES; PROVIDED, FURTHER, That, in the first five (5) 
1072 
years of operation after registration, this amount shall not be less 
1073 
than fifty per centum (50%) of the net surplus.  
1074 
 
1075 
(a) The reserve fund shall be used for the stability of 
1076 
the cooperative and to meet net losses in its operations, 
1077 
INCLUDING LOSSES INCURRED DURING A PANDEMIC, A STATE 
1078 


36 
 
 
OF EMERGENCY, AND OTHER SUCH FORCE MAJEURE. PROVIDED, 
1079 
THAT IF ANY OF THE AFOREMENTIONED EVENTS OCCUR, 
1080 
NECESSITATING 
THE 
USE 
OF 
THE 
RESERVE 
FUND, 
1081 
COOPERATIVES MAY USE NOT GREATER THAN FIFTEEN PER 
1082 
CENTUM (15%) OF THE LATTER TO MITIGATE THE LOSSES 
1083 
INCURRED, AS MAY BE APPROVED OR CONFIRMED BY THE 
1084 
GENERAL ASSEMBLY OF THE COOPERATIVE, AS THE CASE MAY 
1085 
BE.  The general assembly may decrease the amount 
1086 
allocated to the reserve fund when the reserve fund already 
1087 
exceeds the share capital. 
1088 
Any sum recovered on items previously charged to the 
1089 
reserve fund shall be credited to such fund. 
1090 
(b) x x x 
1091 
(c) x x x 
1092 
 
1093 
(2) An amount for the education and training fund (CETF), 
1094 
shall not be more than ten per centum (10%) BUT NOT LESS THAN 
1095 
FIVE PER CENTUM (5%) of the net surplus. The by-laws may 
1096 
provide that certain fees or a portion thereof be credited to such 
1097 
fund. The fund shall provide for the training, development and 
1098 
OTHER similar [other] cooperative activities geared towards the 
1099 
growth of the cooperative movement: 
1100 
 
1101 
(a) Half of the amounts transferred to the [education and 
1102 
training fund] CETF annually under this subsection shall be spent 
1103 
by the cooperative for education and training purposes; while the 
1104 
other half [may] SHALL be remitted to a union AND/or federation 
1105 
chosen by the cooperative or of which it is a member, OF WHICH, 
1106 
NOT MORE THAN EIGHTY PER CENTUM (80%) BUT NOT LESS THAN 
1107 
FIFTY PER CENTUM (50%) MUST REDOUND TO THE BENEFIT AND 
1108 
DEVELOPMENT OF SAID MEMBER COOPERATIVES, SUCH AS, BUT NOT 
1109 
LIMITED 
TO 
TRAININGS, 
SEMINARS, 
AND 
OTHER 
RELATED 
1110 
ACTIVITIES. FAILURE OF THE MEMBER-COOPERATIVE TO REMIT SUCH 
1111 


37 
 
 
AMOUNT TO THE FEDERATION AND/OR UNION SHALL RESULT IN 
1112 
APPROPRIATE SANCTIONS, SUCH AS SUSPENSION OF PRIVILEGES OR 
1113 
NON-ISSUANCE OF THE CERTIFICATE OF COMPLIANCE, AMONG 
1114 
OTHERS, AS MAY BE DECIDED BY THE AUTHORITY.  The said union 
1115 
or federation shall submit to the Authority and to its contributing 
1116 
cooperatives the following schedules: 
1117 
i. 
List of cooperatives which have remitted their 
1118 
respective [Cooperative Education and Training 
1119 
Funds (] CETF[)]; 
1120 
ii. 
Business consultancy assistance to include the 
1121 
nature and cost; 
1122 
iii. 
Other training activities undertaken specifying 
1123 
therein the nature, participants and cost of each 
1124 
activity. 
1125 
(b) x x x 
1126 
 
1127 
(3) An amount for the community development fund 
1128 
(CDF), which shall not be less than three per centum (3%) of 
1129 
the net surplus. The [community development fund] CDF shall 
1130 
be used for projects or activities that will benefit [the community 
1131 
where the cooperative operates] 
OR AID: I) DIFFERENT 
1132 
COMMUNITIES AROUND THE PHILIPPINES, ESPECIALLY THOSE IN 
1133 
NEED DUE TO NATURAL DISASTERS, STATES OF EMERGENCY, OR 
1134 
OTHER SIMILAR CIRCUMSTANCES; OR II) PARTNER INTERNATIONAL 
1135 
COOPERATIVES. HOWEVER, PRIORITY MUST BE GIVEN TO THE 
1136 
COMMUNITY 
WHERE 
THE 
COOPERATIVE 
OPERATES. 
THE 
1137 
COOPERATIVES SHALL HAVE FULL AUTHORITY TO DECIDE ON WHICH 
1138 
PROJECTS THE CDF SHALL BE UTILIZED, BASED ON THE NEEDS OF 
1139 
THEIR COMMUNITIES OR OTHER PARTNERS. THE CDF MUST BE 
1140 
UTILIZED WITHIN ONE (1) YEAR FROM THE DISTRIBUTION OF THE 
1141 
NET SURPLUS. FAILURE TO DO SO WILL SUBJECT THE COOPERATIVE 
1142 
TO APPROPRIATE PENALTIES, AS MAY BE DETERMINED BY THE 
1143 
AUTHORITY. 
1144 


38 
 
 
 
1145 
(4) An optional fund, a land and building, and any other 
1146 
necessary fund the total of which shall not exceed seven per 
1147 
centum (7%). THIS FUND MAY ALSO BE USED FOR THE BENEFIT OF 
1148 
ITS 
MEMBERS 
AND 
EMPLOYEES 
UNDER 
EXCEPTIONAL 
1149 
CIRCUMSTANCES SUCH AS THE OCCURRENCE OF A PANDEMIC, CRISIS 
1150 
OR FORCE MAJEURE. 
1151 
 
1152 
HOWEVER, IF THE OPTIONAL FUND IS INSUFFICIENT, THE 
1153 
COOPERATIVE MAY CHARGE ANY DEFICIENCY TO DIRECT EXPENSES. 
1154 
(5) x x x 
1155 
 
1156 
The sum allocated for patronage refunds shall be made 
1157 
available at the same rate to all patrons of the cooperative in 
1158 
proportion to their individual patronage: Provided, That: 
1159 
(a) x x x 
1160 
(b) x x x 
1161 
(c) x x x 
1162 
(d) x x x” 
1163 
 
1164 
Section 9. Article 109 of Chapter XIV on Public Service Cooperatives of 
1165 
the same Code, is hereby amended to read as follows: 
1166 
 
1167 
“ART. 109. DEFINITION AND COVERAGE. –  A public service 
1168 
cooperative, within the meaning of this Code, is one organized 
1169 
to render public services as authorized under a franchise or 
1170 
certificate of public convenience and necessity duly issued by the 
1171 
appropriate government agency. Such services may include the 
1172 
following: 
1173 
(1) WATER SUPPLY OR DISTRIBUTION; 
1174 
(2) HEALTH SERVICES; 
1175 
(3) Power generation, transmission, and/or distribution; 
1176 
(4) Ice plants and cold storage services; 
1177 


39 
 
 
(5) 
Communication 
services, 
including 
telephone, 
1178 
telegraph, and telecommunications, AND OTHER VALUE-ADDED 
1179 
SERVICES; 
1180 
(6) Land and sea transportation cooperatives for passenger 
1181 
and/or cargo. Transport cooperatives organized under the 
1182 
provisions of Executive Order No. 898, Series of 1983, shall be 
1183 
governed by this Chapter; 
1184 
(7) Public markets, slaughterhouses and other similar 
1185 
services; and 
1186 
(8) Such other types of public service as may be engaged 
1187 
in by any cooperative. Such cooperative shall be primarily 
1188 
governed by this Chapter and the general provisions of this Code 
1189 
insofar as they may be applicable unless they are inconsistent 
1190 
herewith. 
1191 
 
1192 
ART. 110. REGISTRATION REQUIREMENTS. –  x x x. 
1193 
ART. 111. REGULATION OF PUBLIC SERVICE COOPERATIVES. –  x x 
1194 
x. 
1195 
ART. 
112. 
ENGAGEMENT 
IN 
ALLIED 
BUSINESSES 
BY 
1196 
TRANSPORTATION SERVICE COOPERATIVES. –  x x x. 
1197 
ART. 113. RENEWAL OF FRANCHISE AND VEHICLE REGISTRATION. –  
1198 
x x x.” 
1199 
 
1200 
Section 10. Articles 115 and 117 of Chapter XV on Credit Cooperatives of 
1201 
the same Code, are hereby further amended to read as follows: 
1202 
 
1203 
“ART. 114. COVERAGE. –  x x x. 
1204 
ART. 115. DEFINITION AND OBJECTIVES. –  A credit cooperative 
1205 
is a financial organization OR INTERMEDIARY owned and operated 
1206 
by its members with the following objectives: 
1207 
(1) To encourage savings among its members; 
1208 
(2) To create a pool of such savings for which loans for 
1209 
productive or provident purposes may be granted to its 
1210 


40 
 
 
members; and 
1211 
(3) To provide related services to enable its members to 
1212 
maximize the benefit from such loans. 
1213 
 
1214 
ART. 116. ORGANIZATION AND REGISTRATION. –  x x x. 
1215 
ART. 117. ORGANIZATIONAL LINKAGE. –  Credit cooperatives 
1216 
may organize chapters or subsidiaries, or join leagues and 
1217 
federations for the purpose of providing commonly needed 
1218 
essential services including but not limited to the following: 
1219 
(1) Interlending of surplus fund; 
1220 
(2) Mutual benefits; 
1221 
(3) Deposit guarantee; 
1222 
(4) Bonding; 
1223 
(5) Education and training; 
1224 
(6) Professional and technical assistance; 
1225 
(7) Research and development; 
1226 
(8) Representation; [and] 
1227 
(9) STABILITY FUND; AND 
1228 
(10) Other services needed to improve their performance. 
1229 
 
1230 
ART. 118. CONVERSION OF CREDIT COOPERATIVES TO FINANCIAL 
1231 
SERVICE COOPERATIVES. –  x x x.” 
1232 
 
1233 
Section 11. Article 130 of Chapter XVII on Electric Cooperatives of the 
1234 
same Code, is hereby amended to read as follows: 
1235 
 
1236 
“ART. 126. COVERAGE. –  x x x. 
1237 
ART. 127. REGISTRATION OF ELECTRIC COOPERATIVES. –  x x x. 
1238 
ART. 128. VOTING REQUIREMENTS FOR REGISTRATION. –  x x x. 
1239 
ART. 129. DOCUMENTS TO BE SUBMITTED FOR REGISTRATION WITH 
1240 
THE AUTHORITY. –  x x x. 
1241 
ART. 130. [REGISTRATION OPTIONS OF ELECTRIC COOPERATIVES] 
1242 
ROLE OF THE NATIONAL ELECTRIFICATION ADMINISTRATION. –  ALL 
1243 


41 
 
 
ELECTRIC COOPERATIVES MUST REGISTER WITH THE AUTHORITY, AS 
1244 
REQUIRED UNDER THIS CODE. THIS NOTWITHSTANDING, THE 
1245 
NATIONAL ELECTRIFICATION ADMINISTRATION (NEA) RETAINS 
1246 
JURISDICTION WITH REGARD TO THE AUTHORITY AND REGULATION 
1247 
OVER THE TECHNICAL ASPECTS OF AN ELECTRIC COOPERATIVE. 
1248 
 
1249 
ART. 131. ROLE OF THE ENERGY REGULATORY COMMISSION. –  x x 
1250 
x. 
1251 
ART. 132. EFFECTS OF REGISTRATION WITH THE AUTHORITY. –  x x 
1252 
x. 
1253 
ART. 133. SHARE CAPITAL IN THE ELECTRIC COOPERATIVE. –  x x x. 
1254 
ART. 134. CANCELLATION OF REGISTRATION WITH THE AUTHORITY. 
1255 
–  x x x.” 
1256 
 
1257 
Section 12. Article 135 of Chapter XVIII on Miscellaneous Provisions of 
1258 
the same Code, is hereby further amended to read as follows: 
1259 
 
1260 
“ART. 135. COMPLIANCE WITH OTHER LAWS. – [The Labor Code 
1261 
and all other labor laws, the Social Security Act, the Medical Care 
1262 
Act, and all other social legislations and all other laws and 
1263 
executive orders shall apply to a]ALL COOPERATIVES DULY 
1264 
REGISTERED UNDER THIS CODE[.] SHALL, AT ALL TIMES, BE SUBJECT 
1265 
TO ALL RELEVANT LAWS, RULES AND REGULATIONS, AS WELL AS 
1266 
ISSUANCES AND DIRECTIVES ISSUED BY A DULY AUTHORIZED 
1267 
GOVERNMENT REGULATORY BODY IN EXERCISE OF ITS JURISDICTION 
1268 
UNLESS OTHERWISE SPECIFICALLY COVERED BY PROVISIONS OF THIS 
1269 
CODE. 
1270 
 
1271 
THIS 
NOTWITHSTANDING, 
COOPERATIVES 
THAT 
ARE 
1272 
REGISTERED OR APPLYING FOR SPECIFIC LICENSES WITH OTHER 
1273 
REGULATORY AGENCIES MUST COMPLY WITH THE GOVERNANCE 
1274 
REQUIREMENTS OF SAID AGENCY TO OPERATE OR FUNCTION AS SUCH. 
1275 
 
1276 


42 
 
 
ART. 136. REGISTER OF COOPERATIVES. –  x x x. 
1277 
ART. 137. SETTLEMENT OF DISPUTES, CONCILIATION, AND 
1278 
MEDIATION PROCEEDINGS. –  x x x. 
1279 
ART. 138. JOINT OVERSIGHT COMMITTEE ON COOPERATIVES 
1280 
(JCOCC). –  x x x.” 
1281 
 
1282 
Section 13. Articles 139, 140, 141, and 144 of Chapter XIX on Final 
1283 
Provisions of the same Code, are hereby further amended to read as follows: 
1284 
 
1285 
“ART. 139. IMPLEMENTING RULES AND REGULATIONS. –  WITHIN 
1286 
NINETY (90) DAYS FROM THE EFFECTIVITY OF THIS ACT, the 
1287 
Authority shall issue rules and regulations to implement [those 
1288 
provisions  of] THIS CODE, INCLUDING THE AMENDMENTS THERETO 
1289 
[which expressly call for the issuance thereof. This paragraph 
1290 
shall not apply to those cases wherein a specific provision of this 
1291 
Code expressly designates particular government agencies which 
1292 
shall issue the regulations called for by any provision of this 
1293 
Code]. WITHIN THE SAME PERIOD, THE PARTICULAR GOVERNMENT 
1294 
AGENCIES EXPRESSLY DESIGNATED UNDER SPECIFIC PROVISIONS IN 
1295 
THIS CODE SHALL ALSO ISSUE THE REGULATIONS CALLED FOR BY 
1296 
SUCH RESPECTIVE PROVISIONS. 
1297 
 
1298 
ART. 140. PENAL PROVISIONS. –  The following acts or 
1299 
omissions affecting cooperatives are hereby prohibited: 
1300 
 
1301 
(1) The use of the word ‘cooperative’ by any person or of 
1302 
persons or organizations, unless duly registered as a cooperative 
1303 
under this Code except as provided for under Article 130 hereof. 
1304 
In case of violation, the individual or individuals concerned, or in 
1305 
the case of an organization, its officers and directors shall, upon 
1306 
conviction, each suffer the penalty of imprisonment of not less 
1307 
than two (2) years nor more than five (5) years and a fine not 
1308 
exceeding [Twenty thousand pesos (P20,000.00)] TWO 
1309 


43 
 
 
HUNDRED THOUSAND PESOS (P200,000.00) or both at the 
1310 
discretion of the court; 
1311 
 
1312 
The Authority may motu proprio, initiate complaints for 
1313 
violations of this provision. 
1314 
 
1315 
(2) Any person who willfully attempts in any manner to 
1316 
evade or defeat tax in violation of the provisions of Articles 60 
1317 
and 61 of this Code shall, in addition to other penalties provided 
1318 
by law, upon conviction thereof, be punished by a fine of not less 
1319 
than Thirty thousand pesos (P30,000.00) but not more than [One 
1320 
hundred thousand pesos (P100,000.00)] THREE HUNDRED 
1321 
THOUSAND PESOS (P300,000.00) and suffer imprisonment of 
1322 
not less than two (2) years but not more than four (4) years:  
1323 
Provided, That the conviction or acquittal obtained under this 
1324 
article shall not be a bar to the filing of a civil suit for the 
1325 
collection of taxes; 
1326 
 
1327 
(3) x x x 
1328 
(4) x x x 
1329 
(5) x x x 
1330 
(6) x x x 
1331 
(7) x x x 
1332 
 
1333 
The cooperative or any of its members can file a case 
1334 
against any officer or employee of the [Bureau of Internal 
1335 
Revenue] BIR or of any other government agency with the 
1336 
Ombudsman, the Civil Service Commission, other appropriate 
1337 
government agency or the courts of law. 
1338 
In case of violation of any provision of this Code, the 
1339 
individual or individuals, and in the case of organizations or 
1340 
government agencies, its officers, and directors shall, upon 
1341 
conviction by a Court, each suffer a penalty of not less than two 
1342 


44 
 
 
(2) years but not more than five (5) years imprisonment or a fine 
1343 
in the amount of not less than Twenty thousand pesos 
1344 
(P20,000.00), or both at the discretion of the court. In the case 
1345 
of a public official or employee, the offender shall upon 
1346 
conviction, suffer the accessory penalty of temporary absolute 
1347 
disqualification. 
1348 
 
1349 
ART. 141. PRINTING AND DISTRIBUTION. –  (1) [The National 
1350 
Printing Office shall publish t]This Code, AS AMENDED, SHALL BE 
1351 
PUBLISHED in the Official Gazette in full within sixty (60) days 
1352 
from the date of approval thereof. Copies of this Code shall be 
1353 
given to every department, agency and instrumentality of the 
1354 
National Government, including regional, provincial offices and 
1355 
local governments including government-owned and controlled 
1356 
corporations. 
1357 
(2) X X X 
1358 
 
1359 
ART. 142. INTERPRETATION AND CONSTRUCTION. –  x x x. 
1360 
ART. 143. REPEALING CLAUSE. –  x x x. 
1361 
ART. 144. TRANSITORY PROVISIONS. –  (1) x x x 
1362 
(2) x x x 
1363 
(3) x x x 
1364 
(4) TO ENSURE A SMOOTH IMPLEMENTATION OF THIS CODE, 
1365 
THE AUTHORITY GRANTED TO NON-COOPERATIVES AS TRAINING 
1366 
SERVICE PROVIDERS SHALL CONTINUE TO BE EFFECTIVE UNTIL THEIR 
1367 
EXPIRATION OR SIX (6) MONTHS FROM THE PROMULGATION OF THE 
1368 
IRR TO BE ISSUED PURSUANT TO ART. 139 OF THIS CODE, 
1369 
WHICHEVER COMES LATER. 
1370 
(5) PRIMARY COOPERATIVES ALREADY EXISTING MUST 
1371 
BECOME MEMBERS OF A FEDERATION AND/OR UNION WITHIN SIX (6) 
1372 
MONTHS FROM THE EFFECTIVITY OF THIS ACT, IN COMPLIANCE WITH 
1373 
ART. 10 HEREIN. 
1374 
ART. 145. SEPARABILITY CLAUSE. –  x x x. 
1375 


45 
 
 
ART. 143. EFFECTIVITY CLAUSE. –  x x x.” 
1376 
 
1377 
Section 14. Separability Clause. – If any provision contained herein is 
1378 
declared unconstitutional, invalid, illegal, or unenforceable in any respect, the 
1379 
validity, legality, and enforceability of the remaining provisions shall not be 
1380 
affected or impaired in any way. 
1381 
 
1382 
Section 15. Repealing Clause. – All provisions, laws, rules and regulations, 
1383 
orders, decrees, and issuances, insofar as they are inconsistent with the 
1384 
foregoing amendments and provisions, are hereby repealed or modified 
1385 
accordingly. The remaining provisions of R.A. No. 6938, as amended, are hereby 
1386 
adopted as part of the Code. 
1387 
 
1388 
Section 16. Effectivity. – This Act shall take effect fifteen (15) days after 
1389 
the completion of its publication in the Official Gazette or in two (2) newspapers 
1390 
of general circulation. 
1391 
 
1392 
Approved, 
1393