FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
) 
) 
) 
SENATE 
S.B. No. 
1415 
Introduced by Senator Loren Legarda 
EXPLANATORY NOTE 
A cooperative is defined as "a duly registered association of persons, with a 
common bond of interest, who have voluntarily joined together to achieve a lawful 
common social or economk end, making equitable contributions to the capital 
required and accepting a fair share of the risks and benefits of the undertaking in 
accordance with universally accepted cooperative principles." Time has proven the 
valuable contribution of cooperatives in agrarian reforms. Having direct interaction 
with peasants and landowners, they have been instrumental in heralding different 
agrarian reform programs to further the agrarian development in the country. 
As part of the Agricultural Land Reform Code, or Republic Act No. 3844, 
otherwise known as the "Code of Agrarian Reform in the Philippines" as amended 
by RA No. 7907, the Land Bank of the Philippines was created to help with land 
reform, especially the purchase of agricultural estates for division and resale to small 
landholders and the purchase of land by the agricultural lessee. 
A Board of Directors, chaired by the incumbent Department of Finance 
Secretary, has been mandated t<;> carry out the affairs and business of the bank. The 
composition of the board manifests that the bill has overlooked the importance of 
cooperatives in agrarian reform. There is no proper representation of these 
cooperatives, depriving them the chance to ensure that their voice is heard, in the 
Board of Directors governing the LBP. It is unfortunate that LBP, being the official 
financial intermediary for the Comprehensive Agrarian Reform Program in 1988, 
has untapped the rich experience of cooperative movement because of the absence 
of specific provisions in the bill. 
In recognition of the abovementioned issues, this bill seeks to further amend 
RA No. 3844, as amended by RA No. 7907, through the inclusion of a proviso 
authorizing the proper representation of cooperatives in the LBP Board. Such 
provision shall be helpful in the issuance of comprehensive decisions and courses of 
actions by the LBP. 
In view of the foregoing, the passage of this bill is earnestly sought. 
~= 
5 
-
~~GAiD~---=> 
Senator 


FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
) 
) 
) 
SENATE 
1415 
S.B. No. ~~~_ 
Introduced by Senator Loren Legarda 
• 
AN ACT 
! U JUL! :; 
C) /D 7 
MANDATING THE REPRESENTATION OF COOPERATIVES IN THE BOARD 
OF DIRECTORS OF THE LAND BANK OF THE PHILIPPINES, AMENDING 
FOR THIS PURPOSE REPUBLIC ACT NUMBER 3844, AS AMENDED 
Be it enacted by the Senate and House of the Representatives of the Philippines in 
Congress assembled: 
1 
SECTION 1. Section 86 Republic Act No. 3844, otherwise known as the Code 
2 
of Agrarian Reform in the Philippines, as amended by Republic Act No. 7907, is 
3 
further amended to read as follows: 
4 
5 
"Sec. 86. The Board of Directors; Membership; Per Diem - The 
6 
affairs of and business of the Bank shall be directed and its property 
, 
7 
managed and preserved by a Board of Directors consisting of [nine 9] 
8 
TEN (10) members to be composed of the Secretary of Finance, as 
9 
[Chairman] CHAIRPERSON, the Secretary of Agrarian Reform, the 
10 
Secretary of Labor, and the Secretary of Agriculture as ex-officio 
11 
members. THE PRESIDENT OF THE PHILIPPINES SHALL 
12 
APPOINT TWO (2) MEMBERS REPRESENTING THE AGRARIAN 
13 
REFORM BENEFICIARIES, PROVIDED THAT AT LEAST ONE (1) 
14 
OF THE SAID REPRESENTATIVES SHALL COME FROM AN 
15 
ORGANIZED AGRARIAN REFORM BENEFICIARIES FARMERS 
16 
COOPERATIVE, IF ANY; TWO (2) MEMBERS REPRESENTING 
17 
THE PRIVATE SECTOR AND ONE (1) MEMBER REPRESENTING 
18 
THE COOPERATIVE SECTOR; PROVIDED, FURTHER, THAT 
19 
THE REPRESENTATIVE OF THE COOPERATIVE SECTOR SHALL 
20 
BE APPOINTED BY THE PRESIDENT OF THE PHILIPPINES 
21 
FROM THE NOMINEES OF THE NATIONAL COOPERATIVE 
1 


1 
FEDERATIONS AND/OR UNIONS DULY RECOGNIZED BY THE 
2 
COOPERATIVE DEVELOPMENT AUTHORITY. [The President of 
3 
the Philippines shall appoint two (2) members who shall represent the 
4 
agrarian reform beneficiaries and two (2) members who shall represent 
5 
the agrarian reform beneficiaries and two (2) members who shall 
6 
represent the private sector. The two (2) remaining members shall be 
7 
elected from the shareholders coming from the public sector to the 
8 
extent that they may be entitled to two (2) seats in proportion to the 
9 
outstanding capital stock.] " 
10 
11 
"No person shall be elected or appointed director of the Bank unless 
12 
[he] THAT PERSON is anatural born citizen of the Philippines, not 
13 
less than thirty- five years of age, of good moral character, and has 
14 
attained proficiency, expertise and recognize competence in one or 
15 
more of the following; banking, finance, economics, agriculture, 
16 
agrarian reform, COOPERATIVES AND business management: 
17 
Provided further, that no director, shareholder or employee of any 
18 
bank shall be eligible fo~ election or appointment as member of the 
19 
Board of Directors of the Bank. 
20 
21 
SECTION 2. All members of the Board of Directors at the time of the 
22 
approval and effectivity of this act shall continue in office until the end of their term 
23 
of office as defined in Section 86 of R.A 3844 as amended. At the end of their term, 
24 
the President shall appoint the members of the Board in accordance with Act. 
25 
26 
SECTION 3. Repealing Clause. - All laws, presidential decrees, executive 
27 
orders in whole or in part, including the rules and regulations promulgated there 
28 
under inconsistent with the provisions of this Act, are herby amended, repealed or 
29 
modified accordingly. 
30 
31 
SECTION 4. Effectivity. - This Act shall take effect fifteen (15) days following 
32 
its publication in at least two (2) newspapers of general circulation. 
33 
34 
Approved, 
2