FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Third Regular Session 
) 
) 
) 
SENATE 
SENATE BILL NO._ .3219 ': 
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Introduced by Senator Ferdinand R. Marcos, Jr. 
EXPLANATORY NOTE 
Article XII, Section 15 of the Constitution provides that "the Congress shall create 
an agency to promote the viability and growth of cooperatives as instruments for social 
justice and economic development." Pursuant to this mandate, Congress has enacted 
Republic Act 6939 which created the Cooperative Development Authority. This law is 
designed to foster the creation and growth of cooperatives in the country but has so far 
failed to attain the purpose of its creation due to institutional weaknesses. 
The principle of cooperatives is primarily aimed to promote people empowerment. 
Its practical application and benefits is most desired in the rural areas where less 
privileged individuals with common bond of interest may organize themselves towards the 
attainment of economic development. 
While many cooperatives had sprung and organized with great hope for economic 
development under the ideals of cooperativism, many had ended up in vain or with dismal 
growth. The failures are attributed to inadequate assistance, supervision and regulation 
by the Cooperative Development Authority (CDA). 
The proposed measure seeks to strengthen the powers, duties and functions of 
the CDA to become an effective vehicle for the development of cooperatives in the 
country and to usher the eventual recognition of cooperatives as one of the potent forces 
for national development. 
Thus, the early passage of this bill is eamestly requested. 
1 


FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Third Regular Session 
) 
) 
) 
SEN ATE. 
':; , 
SENATE BILL NO. 
-324.:5 
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Introduced by Senator Ferdinand R. Marcos, Jr. 
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AN ACT 
REORGANIZING THE COOPERATIVE DEVELOPMENT AUTHORITY, REPEALING FOR 
THE PURPOSE REPUBLIC ACT NO. 6939, CREATING THE COOPERATIVE 
DEVELOPMENT AUTHORITY 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
SECTION 1. Short Title. -
This Act shall be known as the "Cooperative 
Development Authority Charter Act." 
SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State to 
promote the viability and growth of cooperatives as instruments of equity, social justice 
and economic development and to create an agency, in fulfillment of the mandate in 
Section 15, Article XII of the 1987 Constitution. 
Toward this end, the State shall recognize cooperatives as associations organized 
for the economic and social betterment of their members, operating business enterprises 
based on mutual aid, and founded upon internationally accepted cooperative principles 
and practices. The State recognizes the Cooperative Development Authority as primarily 
responsible for the institutional development of cooperatives. 
Accordingly, the State 
recognizes the rights of the cooperatives to initiate and foster within their own ranks 
cooperative promotion, organization, training, information gathering, audit and support 
services, with government assistance where necessary. In furtherance of this policy, the 
National Economic and Development Authority shall include the promotion of growth and 
expansion of cooperatives as major and indispensable components of national 
development plans. 
The government and all its branches, subdivisions, instrumentalities and agencies 
shall ensure the provision of technical guidance, financial assistance and other services 
to enable the cooperatives to develop into viable and responsive economic enterprises 
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towards a strong cooperative movement free from any condition which infringes upon the 
objectives and character of cooperatives. The State shall, except as provided in this Act, 
maintain the policy of non-interference in the management and operation of cooperatives. 
SEC. 3. Cooperative Development Authority. - The Cooperative Development 
Authority created under Republic Act No. 6939, hereinafter referred to as the Authority, is 
hereby reorganized to carry out the provisions of this Act and those of Republic Act No. 
9520, otherwise known as the "Philippine Cooperative Code of 2008". The Authority shall 
have its principal place of business in Metro Manila, and shall maintain offices and 
branches in such other places as the proper conduct of its business shall require. The 
Authority shall be an agency attached to the Office of the President for policy and 
program coordination. 
SEC. 4. Powers, Functions and Responsibilities. - The Authority shall have 
the following powers and functions: 
a) 
Exercise supervision and jurisdiction over all types and categories af 
cooperatives registered with the Authority; 
b) 
Register all types of cooperatives including amendments to its by-laws; 
division, merger, consolidation, dissolution and liquidation of cooperatives 
as well as the transfer of all or substantially all of their assets and liabilities; 
c) 
Order the cancellation or revocation of the Certificate of Registration after 
due notice and hearing pursuant to Articles 67 & 68 of the Philippine 
Cooperative Code of 2008 and the by-laws of the cooperative; 
d) 
Formulate, adopt, and implement integrated plans and programs on 
cooperative 
development 
consistent 
with 
the 
national 
policy 
on 
cooperatives, and establish an integrated framework on cooperative 
development for all government agencies; 
e) 
Develop and formulate, in consultation with the cooperative sector, and 
issue appropriate regulations, standards, rules, orders, guidelines and/or 
circulars to implement the Cooperative Code to ensure the sound operation 
of cooperatives; 
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f) 
Establish a consultative mechanism in order to provide the cooperative 
sector a system for maximum participation on matters of government plans, 
projects and policies related to cooperatives. 
The cooperative sector shall undertake the organization/streamlining 
or rationalization of an apex body, representing all types and categories of 
cooperatives under the Philippine Cooperative Code of 2008, which shall 
function as the overall consultative and coordinating body with the Authority. 
The Authority, in consultation with the cooperative sector, shall 
promulgate the guidelines for the implementation of the consultative 
mechanism; 
g) 
Establish, operate and maintain an institute to enhance the knowledge and 
technical skills of the Authority and cooperatives; 
h) 
Require the submission of annual reports, audited financial statements, and 
such reports in compliance with the Philippine Cooperative Code of 2008, in 
such forms as may be prescribed by the Authority; 
i) 
Conduct regular inspection or examination of a cooperative in accordance 
with rules and regulations promulgated by the Authority and when deemed 
necessary, conduct a special inspection and investigation to protect the 
interest and welfare of the members of cooperatives. However, the 
Authority may delegate this power to accredited federations and unions in 
accordance with the Philippine Cooperative Code of 2008 and the 
implementing rules and regulations issued for this purpose; 
j) 
Compel the cooperative to call a General Assembly under the supervision 
of the Authority, subject to the criteria or condition/s to be defined in the 
implementing rules and regulations issued for this purpose; 
In case a cooperative fails to call and conduct a General Assembly, 
the Authority shall, on its own, call a general assembly meeting to address 
and settle the issues. The Authority may enlist the aid and support of and/or 
deputize any and all enforcement agencies of the government and 
federations and unions for the implementation of its orders; 
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(k) 
Impose sanctions for non-compliance with lawful orders, rules and 
regulations of the Authority, including the Articles of Cooperation and the 
By-Laws of the cooperative subject to conditions as defined in the 
implementing rules and regulations of this Act; 
k) 
Collect reasonable fees, fines or charges in the performance of its 
registration and regulatory functions which shall be deposited under a trust 
fund and to be utilized by the Authority for developmental purposes, subject 
to the implementing rules and regulations issued for this purpose; 
(m) 
Establish regional offices in all political and administrative regions in the 
country and such other places as may be determined by the Authority; 
(n) 
Hear, decide and settle disputes between and among members, officers, 
and directors of cooperatives, and between and among cooperatives in 
accordance with Article 137 of the Philippine Cooperative Code of 2008; 
(0) 
Implement and enforce its decision with the assistance of deputized law 
enforcement agencies or the local government unit concerned as may be 
necessary; and 
(p) 
Exercise such other powers and functions as may be necessary to 
implement the provisions of the Philippine Cooperative Code of 2008. 
SEC. 5. 
Organizational Structure. - The Authority shall have a Board of 
Directors and an Office of the Administrator. 
The Board of Directors, hereinafter referred to as the Board, shall be the collegial 
policy-making body of the Authority which shall be composed of the Chairperson and six 
(6) members of the Board of Directors, all of whom shall be chosen from among the 
nominees of the cooperative sector, with two (2) representatives each from Luzon, 
Visayas and Mindanao. They shall be appointed by the President of the Philippines and 
shall serve for a term of six (6) years without reappointment. Except for the Chairperson, 
the Members of the Board shall serve on a part-time basis only: Provided, That any 
vacancy in the Board shall be filled-up by appointment of the President in accordance 
with the provisions of this section: Provided, further, That a member so appointed shall 
serve only for the unexpired term: Provided, finally, That the incumbent Chairperson and 
5 


members of the Board shall continue to serve and act as chairperson and members of 
the present Board up to the end of their term under Republic Act No. 6939. 
Except for the Chairperson, the members of the Board shall be entitled to 
honoraria and actual travel expenses. 
The Office of the Administrator shall be headed by the Chairperson of the Board 
who shall exercise over-all supervision on the operations of the Authority. 
SEC. 6. Powers and Functions of the Board. - The Board as the policy making 
body shall have the following powers and functions: 
a) 
Formulate policies, rules and regulations consistent with the provisions of 
the Philippine Cooperative Code of 2008; 
b) 
Adopt implementing rules and regulations for the conduct of the internal 
operations of the Authority; 
c) 
Organize the operating structure and functions of the Authority. No changes 
in the approved organizational structure shall be effected without the 
approval of the Board; and 
d) 
Approve and adopt the annual budget of the Authority. 
SEC. 7. 
Qualifications of Members of the Board. -
The Chairperson or a 
Member of the Board who shall be appointed must possess the following qualifications: 
a) 
A natural born Filipino citizen; 
b) 
Must not be more than sixty (60) years old at the time of the appointment 
and must be in good health; 
c) 
A holder of at least a bachelor's degree and five (5) years of experience as 
an official or officer of a cooperative, government agency, or non-
government organization engaged in cooperative development or, in the 
absence of the bachelor's degree, at least seven (7) years of experience in 
cooperatives either as an officer of a cooperative or a government agency 
or non-government organization engaged in cooperative development; 
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d) 
Except the Chairperson who should be a resident of the Philippines, the 
other Members of the Board must be a resident of the region represented 
for at least five (5) years; and 
e) 
Must be recommended and endorsed by a federation and/or union of 
cooperatives operating in good standing under the provisions of this Act and 
the Philippine Cooperative Code of 2008. 
Any person appointed as Chairperson or regular member of the 
Board shall, upon appointment, divest himself of any direct or indirect 
pecuniary interest or dealings with any cooperative. 
SEC. 8. 
Removal of Member of the Board. - The President of the Philippines 
may remove any member of the Board for any of the following reasons: 
a) 
If the member is subsequently disqualified under the provisions of this Act; 
b) 
If the member becomes physically or mentally incapacitated to properly 
discharge the duties and responsibilities of the position and such incapacity 
has lasted more than six (6) months; and 
c) 
If the member is guilty of acts or omissions which are fraudulent or illegal in 
character or which are manifestly opposed to the aims, objectives and 
interests of the Authority and the cooperative sector. 
SEC. 9. 
Meetings of the Board. - The Board shall meet at least once a month 
for the transaction of its regular business. 
Special meetings may be called by the 
chairperson or majority of the members to consider specific matters. A majority vote by 
the entire Board of Directors shall be required for a decision. All regular and special 
meetings of the Board shall be held at the head office in Metro Manila. 
SEC. 10. Administrator. - The Chairperson shall be the Administrator of the 
Authority and shall have the rank and privileges of an Undersecretary. The Administrator 
shall be assisted by five (5) Deputy Administrators who will be assigned to the following 
specific concerns: 
a. 
Support Services; 
b. 
Institutional Development; 
c. 
Legal Affairs & Registration; 
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d. 
Supervision and Examination; and 
e. 
Field Operations 
In the absence of the Administrator, the Board shall appoint from among the five 
(5) deputy administrators the Officer-In-Charge of the Authority who shall exercise the 
powers and duties of the administrator. 
SEC. 11. Powers and Functions of the Administrator. - The Administrator of 
the Authority shall have the following powers and functions: 
a) 
Preside over the meetings of the Board; 
b) 
Supervise the over-all operations of the Authority; 
c) 
Prepare, consolidate and submit periodic reports for the consideration of the 
Board; 
d) 
Implement a human resource management system consistent with the Civil 
Service Code that will promote professionalism and excellence in 
accordance with sound principles of management; 
e) 
Prepare the proposed annual and supplemental budgets of the Authority for 
the consideration and approval of the Board; 
f) 
Report to the President of the Philippines and Congress on the performance 
and accomplishment of the Authority on a periodic basis; 
g) 
Represent the Authority in all undertakings where its presence is required; 
and 
h) 
Perform such other functions as may be required by law. 
SEC. 12. 
Deputy Administrators. -
The Board shall appoint the deputy 
administrators in accordance with the Civil Service Laws and must possess the following 
qualifications: 
a) 
A natural-born Filipino citizen; 
b) 
Must not be more than 60 years old at the time of the appointment and must 
be in good health; 
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c) 
A holder of a bachelor's degree and five (5) years of experience as an 
official or officer of a cooperative, government agency, or non-government 
organization engaged in cooperative development; and 
d) 
A career executive service officer. 
SEC. 13. Power to Register Cooperatives. - The power to register cooperatives 
shall be vested solely on the Authority pursuant to the provisions of the Philippine 
Cooperative Code of 2008. 
All cooperatives duly registered with the Authority shall present their Certificate of 
Registration to the nearest Bureau of Internal Revenue office and the latter shall within 
ten (10) days issue the Certificate of Tax Exemption. 
Any provision of law, executive order, rule or regulation to the contrary 
notwithstanding, the certificate of registration issued by the Authority to a duly registered 
cooperative shall ipso facto constitute as the sole legal basis or requirement for the full 
enjoyment of the tax exemption granted under Articles 60 and 61 of the Philippine 
Cooperative Code of 2008. Any public official or employee who violates or in any manner 
circumvents this provision shall be dealt with under Article 140 of Philippine Cooperative 
Code of 2008. 
The Authority shall cite this provision in the certificate of registration. 
SEC. 14. Prohibition. - Except as provided for under Article 130 of the Philippine 
Cooperative Code of 2008, the use of the word "cooperative" by any person or 
organization unless duly registered with the Cooperative Development Authority shall be 
prohibited and shall be penalized under Article 140 of the Philippine Cooperative Code of 
2008. 
SEC. 15. Settlement of Disputes. - Disputes within or between cooperatives, or 
disputes within or between federations or unions shall be mediated, conciliated or settled 
in accordance with this Act, Article 137 of the Philippine Cooperative Code of 2008 and 
its implementing rules and regulations or Republic Act No. 9285, otherwise known as the 
Alternative Dispute Resolution Act of 2004. 
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SEC. 16. 
Cooperatives in the Education System. - The history, philosophy, 
concepts, values, principles and practices of cooperatives and their role as a factor in the 
national economy shall be disseminated both in formal and non-formal education. 
Notwithstanding existing laws, memorandum orders and directives, cooperatives 
development and administration as a field of study may be offered as a baccalaureate, 
post baccalaureate or masteral program in state universities and colleges (SUCs) in 
accordance with the standards, rules and regulations promulgated by their respective 
Board of Regents, the Commission on Higher Education (CHED) or the Authority in 
consultation with the cooperative sector as necessary: 
Provided, That SUCs shall 
provide for equivalency credit and accreditation of work experiences and non-formal 
education and training of cooperative leaders, managers and members: Provided further, 
That in cases where the SUCs do not offer a separate academic program in cooperatives 
development and administration, the SUCs shall be encouraged to include a 3-unit 
subject in the curricula of accountancy, agribusiness, agriculture, agricultural economics, 
business, community development, economics, education, forestry, social sciences, and 
other curricula that can be instrumental in the development of cooperatives. 
Special 
incentives including scholarships shall be formulated by the Authority for students taking 
up degree courses on cooperatives development and administration. 
The role of non-government organizations, not registered as cooperatives but duly 
registered under Philippine laws and engaged in cooperative promotion, organization, 
research and education, shall be recognized. The Authority may accredit such non-
government organizations as non-academic training organizations. The training courses 
offered by them may be eligible as credits for the purposes of academic, professional and 
career advancements of their trainees. Existing training centers for cooperatives may 
qualify as non-government organizations under this Act. 
Upon request of cooperatives, State colleges and universities shall provide 
technical assistance and guidance to cooperatives in the communities where they are 
located. 
SEC. 17. 
Cooperatives in the Banking System. -
The promotion and 
development of cooperative banks as part of the banking system and of financial service 
cooperatives as defined in the Philippine Cooperative Code of 2008 shall be a major 
concern of the Authority which shall undertake the necessary program towards this end in 
collaboration with the Bangko Sentral ng Pilipinas (BSP) and the cooperative sector 
concerned. 
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SEC. 18. 
Cooperatives Engaged in Services Covered by Other Laws. -
Registered cooperatives may engage in business endeavors in accordance with its 
approved articles of cooperation provided they acquire the necessary licenses, 
franchises, certificates of authority and permits from the appropriate agencies governing 
their type of cooperatives such as those providing manpower services, construction 
services, professional services, health care services, security services, social welfare 
services, research development, related health services, ecological and environmental 
services, farmers and fisherfolk cooperatives and 
services to indigenous cultural 
minorities. 
SEC. 19. Reorganization of the Authority. - The Authority shall be reorganized 
within one hundred twenty (120) days from the effectivity of this Act. 
SEC. 20. Transitory Provisions. - Upon the effectivity of this Act, the personnel 
of the Cooperative Development Authority shall, unless removed for cause and after due 
process, continue to perform their duties and responsibilities and shall receive their 
corresponding salaries and benefits. 
In the reorganization and staffing of the Authority, these personnel shall be given 
preference subject to civil service rules and regulation and rules of the Classification 
Compensation Bureau of the Department of Budget and Management (DBM); Provided, 
that those who shall not be absorbed by the organization shall be given separation pay 
computed at 1.5 months salary for every year of service. The fraction of six months shall 
be considered as one (1) year in computing years of service for severance pay and 
whatever applicable retirement benefit under existing laws. 
SEC. 21. 
Appropriations. - The amount necessary for the implementation of 
this Act shall be included in the annual General Appropriations Act. 
SEC. 22. Transfer of Funds and Programs. - The Cooperative Development 
Loan Fund and the Fund for Management Training and Assistance Program created 
under Presidential Decree No. 175, as amended, and the Cooperative Marketing Project 
created under loan agreements, all granted to the Department of Agriculture, is hereby 
transferred to the Authority which shall be used for the development and strengthening of 
cooperatives. 
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SEC. 23. 
Joint Congressional Oversight Committee on Cooperatives 
(JCOCC). - The Joint Congressional Oversight Committee created under Article 138 of 
Philippine Cooperative Code of 2008 shall review and monitor the implementation of this 
Act. 
SEC. 24. 
Implementing Rules and Regulations. -
The Board shall, in 
conSUltation with the cooperative sector, formulate the implementing rules and 
regulations for the effective implementation of the provisions of this Act. The 
implementing rules and regulations shall take effect within fifteen (15) days after 
publication in the Official Gazette or in two (2) newspapers of general circulation. All 
subsequent amendments to the implementing rules and regulations shall also be 
published before taking effect. 
SEC. 25. Information Campaign. - The Cooperative Development Authority is 
mandated to conduct an information campaign for six (6) months on the provisions of this 
Act from its effectivity. 
SEC. 26. Repealing Clause. - Republic Act No. 6939, creating the Cooperative 
Development Authority, is hereby repealed. All other laws, decrees, executive orders, 
rules and regulations or parts thereof inconsistent with the provisions of this Act are 
hereby amended or modified accordingly. 
SEC. 27. Separability Clause. - If for any cause, any part of this Act is declared 
unconstitutional, the rest of the provisions shall remain in force and effect. 
SEC. 28. Effectivity Clause. - This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in at least two (2) national newspapers of general 
circulation. 
Approved, 
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