_._
FIFTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
) 
Third Regular Session 
) 
') 1-;- '5·7 
' ... 
'. 
SENATE 
, 
~ , 
3389 
S.B. No. -------
Prepared by the Committees on Energy, and Cooperatives with Senators Osmefia III and 
Recto as Authors thereof. 
AN ACT 
STRENGTHENING THE NATIONAL ELECTRIFICATION ADMINISTRATION, 
FURTHER AMENDING FOR THE PURPOSE PRESIDENTIAL DECREE NO. 269, AS 
AMENDED, OTHERWISE KNOWN AS THE "NATIONAL ELECTRIFICATION 
ADMINISTRATION DECREE" 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
CHAPTER I - POLICY AND DEFINITIONS 
1 
SECTION 1. This Act shall be known as the "National Electrification Administration 
2 
Reform Act of2012." 
3 
SEC. 2. Section 2 of Presidential Decree No. 269, as amended, is hereby further amended, to 
4 
read as follows: 
5 
"SEC. 2. Declaration of National Policy.- [The total electrification of the Philippines on an 
6 
area coverage basis being vital to the welfare of its people and the sound development of the 
7 
Nation, it is hereby declared to be the policy of the state to pursue and foster, in an orderly and 
8 
vigorous manner, the attainment of this objective. For this purpose, the State shall promote, 
9 
encourage and assist all public service entities engaged in supplying elcctric service, paliicularly 
10 
electric cooperatives, which are willing to pursue diligently this objective. 
11 
Because of their non-profit nature, cooperative character and the heavy financial burdens 
12 
that they must sustain to become effectively established and operationally viable, electric 
13 
cooperatives, particularly, shall be given every tenable support and assistance by the National 
14 
Government, its instrumentalities and agencies to the fullest extent of which they are capable; 
15 
and, being by their nature substantially self-regulating and Congress, having, by the enactment of 
1 


1 
this Decree, substantially covered all phases of their organization and operation requiring or 
2 
justifying regulation, and in order to further encourage and promote their development, they 
3 
should be subject to minimal regulation by other administrative agencies. 
4 
Area coverage electrification cannot be achieved unless service to the more thinly settled 
5 
areas and therefore more costly to electrify is combined with service to the most densely settled 
6 
areas and therefore less costly to electrify. Every public service entity should hereafter cooperate 
7 
in a national program of electrification on an area coverage basis, or else surrender its fraJlchise 
8 
in favor of those public service entities which will. It is hereby found that the total electrification 
9 
of the Nation requires that the laws and administrative practices relating to franchised electric 
10 
service areas be revised and made more effective, as herein provided. It is therefore hereby 
11 
declared to be tile policy ofthe State that franchises for electric service areas shall hereafter be so 
12 
issued, conditioned, altered or repealed, and shall be subject to such continuing regulatory 
13 
surveillance, that the same shall conduce to the most expeditious electrification of the entire 
14 
Nation on an area coverage basis.] IT IS HEREBY DECLARED THE POLICY OF THE 
15 
STATE TO: 
16 
(A) 
PROMOTE THE SUSTAINABLE DEVELOPMENT IN THE RURAL 
17 
AREAS THROUGH RURAL ELECTRIFICATION; 
18 
(B) 
EMPOWER AND STRENGTHEN THE NATIONAL ELECTRIFICATION 
19 
ADMINISTRATION TO PURSUE THE ELECTRIFICATION PROGRAM AND BRING 
20 
ELECTRICITY, 
THROUGH 
THE 
ELECTRIC 
COOPERATIVES 
AS 
ITS 
21 
IMPLEMENTING ARM, TO THE COUNTRYSIDE EVEN IN MISSIONARY OR 
22 
ECONOMICALLY UNVIABLE AREAS; 
23 
(C) 
EMI' OWER AND ENABLE ELECTRIC COOPERATIVES TO COPE 
24 
WITH THE CHANGES BROUGHT ABOUT BY THE RESTRUCTURING OF THE 
25 
ELECTRIC POWER INDUSTRY PURSUANT TO REPUBLIC ACT NO. 9136, 
26 
OTHERWISE KNOWN AS THE ELECTIUC POWER INDUSTRY REFORM ACT OF 
27 
2001." 
28 
SEC. 3. A new section is hereby inserted under the same· Presidential Decree, as 
29 
amended, to be designated as Section 2-A, to read as follows: 
30 
"SEC. 2-A. SCOPE.- THIS ACT SHALL ESTABLISH A FRAMEWORK FOR 
31 
INTRODUCING 
STRUCTURAL 
REFORMS 
IN 
THE 
NATIONAL 
2 


--------------
1 
ELECTRIFICATION 
ADMINISTRATION 
AND 
THE 
ELECTRIC 
2 
COOPERATIVES." 
3 
SEC. 4. Five new paragraphs, to be designated as Paragraphs (s), (t), (u), (v) and (w), are 
4 
hereby inselied under Section 3 of the same Presidential Decree, as amended, to read as follows: 
5 
"SEC. 3. D~finitions. - As used in this Decree, the following words or terms shall have 
6 
the following meanings, unless a different meaning clearly appears from the context: 
7 
XXX XXXXXX 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
(S) 
"CDA" SHALL REFER TO THE COOPERATIVE DEVELOPMENT 
AUTHOlUTY CREATED UNDER REPUBLIC ACT NO. 6939, AS AMENDED; 
(T) 
"DOE" SHALL REFER TO THE DEPARTMENT OF ENERGY 
CREATED UNDER REPUBLIC ACT NO. 7638, AS AMENDED; 
(U) 
"ELECTRIC COOPERATIVE" SHALL REFER TO AN ELECTRIC 
DISTRIBUTION 
UTILITY ORGANIZED AND REGISTERED PURSUANT TO 
PRESIDENTIAL DECREE NO. 269, AS AMENDED, REPUBLIC ACT NO. 9520, AND 
OTHER RELATED LAWS; 
(V) 
"EPIRA" SHALL REFER TO REPUBLIC ACT NO. 9136 OR THE 
"ELECTRIC POWER INDUSTRY REFORM ACT OF 2001"; AND 
(W) 
"ERC" 
SHALL 
REFER 
TO 
THE 
ENERGY 
REGULATORY 
COMMISSION CREATED UNDER SECTION 38 OF REPUBLIC ACT NO. 9136." 
CHAPTER II 
THE NATIONAL ELECTRIFICATION ADMINISTRATION 
SEC. 5. Section 4 of Presidential Decree No. 269, as amended, is hereby further amended 
to read as follows: 
"SEC. 4. [NEA Authorities, Powers and Directives. The NEA is hereby authorized, 
empowered and directed to promote, encourage and assist public service entities, particularly 
cooperatives, to the end of achieving the objective of making service available throughout the 
nation on an area coverage basis as rapidly as possible; and for such purpose it is hereby, without 
limiting the generality of the foregoing and in addition to other authorizations, powers and 
directives established by this Decree, specifically authorized, empowered and directed: 
3 


1 
(a) To have a continuous succession under its corporate name until otherwise provided by 
2 
law; 
3 
(b) To prescribe and thereafter to amend and repeal its by-laws not inconsistent with this 
4 
Decree; 
5 
( c) To adopt and use a seal and alter it at its pleasure; 
6 
(d) To sue and to be sued in any court: Provided, That NEA shall, unless it consents 
7 
otherwise, be immune to suits for acts ex delicti; 
8 
(e) To make contract of every name and nature and to execute all instruments necessary 
9 
or convenient for the carrying on of its business; 
10 
(f) To make loans to public service entities, with preference to cooperatives, for the 
11 
construction or acquisition, operation and maintenance of generation, transmission and 
12 
distribution facilities and all related properties, equipment, machinery, fixtures, and materials for 
13 
the purpose of supplying area coverage service, and thereafter to make loans for the restoration, 
14 
improvement or enlargement of such facilities: PrOVided, That the public service entity 
15 
supplying for a loan, if neither a cooperative nor a local government, must be in operation at the 
16 
time of application; 
17 
(g) To promote, encourage and assist public service entities and government agencies and 
18 
corporations having related functions and purposes, with preference to cooperatives, in planning, 
19 
developing, coordinating, establishing, operating, maintaining, repairing and renovating facilities 
20 
and systems to supply area coverage service, and for such purpose to furnish, to the extent 
21 
possible and without change therefor, technical and professional assistance and guidance, 
22 
information, data and the results of any investigation, study, or receipt conducted or made by the 
23 
NEA; 
24 
(h) To approve or disapprove any loan from other lenders to public service entities which 
25 
at the time are borrowers from NEA under subparagraphs (f) or (i) of this section, and thereafter, 
26 
pursuant to Section 10 (b) to disapprove advances ofloans from other lenders; 
27 
(i) To make loans for the purpose of financing the wiring of premises of persons served 
28 
or to be served as a result of loans made under subparagraph (f) of this Section, and for the 
29 
acquisition and installation by such persons of electrically-powered appliances, equipment, 
30 
fixtures and machinery of all kinds for residential, recreational, commercial, agricultural and 
31 
industrial uses, such loans to be made directly (l) to public service entities which have received 
32 
loans under sub-paragraph (f) of this section, which entities shall in turn relend slich funds to 
4 


1 
persons served or to be served by them, or (2) to any persons served or to be served by public 
2 
service entities which have received loans under sub-paragraph (f) of this section: Provided, That 
3 
at no time shall the total loans made under this sub-paragraph (i) to a public service entity and/or 
4 
to persons served or to be served by such entity exceed twenty-five (25%) per centum of the 
5 
outstanding loans to such entity made under sub-paragraph (f) ofthis section; 
6 
G) To so cooperate, coordinate and exchange such information, studies and reports with, 
7 
and to seek such cooperation and coordination ii'om, other departments, agencies and 
8 
instrumentalities of the National Government, including the NPC, as will most effectively 
9 
conduce to the achievement of the purposes of this Decree; 
10 
(k) To borrow funds from any source, private or government, foreign or domestic, and, 
11 
not inconsistently with section 8, to issue bonds or other evidences of indebtedness therefor and 
12 
to secure the lenders thereof by pledging, sharing or subordinating one or more of the NEA's 
13 
own loan securities; 
14 
(1) To receive from Cooperatives all articles of incorporation, amendments, consolidation, 
15 
merger, conversion and dissolution, and all certificates of changes in the location of principal 
16 
offices and of elections to dissolve, and, upon determining that such are in conformity with this 
17 
Decree, to certify the same, to file them in the record,s of the NEA, and to maintain a registry of 
18 
such filings the provisions of Act No. 1459, as amended, to the contrary notwithstanding; 
19 
(m) To acquire, by purchase or otherwise (including the right of eminent domain, which 
20 
is hereby granted to the NEA, to be exercised in the manner provided by law for the institution 
21 
and completion of expropriation proceedings by the National and local governments,) real and 
22 
physical properties, together with all appurtenant rights, easements, licenses and privileges, 
23 
whether or not the same be already devoted to the public use of generating, transmitting or 
24 
distributing electric power and energy, upon NEA's determination that such acquisition is 
25 
necessary to accomplish the purposes of this Decree and, if such properties be already devoted to 
26 
the public use described in the foregoing, that such use will be better served a11Cl accomplished 
27 
by such acquisition: Provided, That the power herein granted shall be exercised by the NEA 
28 
solely as agent for and on behalf of one or more public service entities which shall timely 
29 
receive, own and utilize or replace such properties for the purpose of furnishing adequate and 
30 
dependable service on an area coverage basis, which entity or entities shall then bc, or in 
31 
connection with the acquisition shall become, borrowers from the NEA under sub-paragraph (f) 
32 
of this section: Provided further, That the costs of such acquisition, including the cost of any 
33 
eminent domain proceedings, shall be borne, either directly or by reimbursement to the NEA, 
34 
whichever the NEA shall elect, by the public service entity or entities on whose behalf the 
35 
acquisition is undertaken; and otherwise to acquire, improve, hold, transfer, sell, lease, rent, 
5 


I 
2 
3 
4 
5 
6 
7 
8 
9 
10 
II 
12 
13 
14 
IS 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
mortgage, encumber and otherwise dispose of property incident to, or necessmy, convenient or 
proper to carry out, the purposes for which NEA was created; 
(n) At least annually, not later than June 30th, to report to the President and when the 
same comes into existence, the Prime Minister and the National Assembly, on the status of 
electrification of the Philippines, including a comprehensive reporting of loans made, loan funds 
advanced, loans secured from other sources and the ~dvmlces thereof, the names and locations of 
the borrowers, the number of services contemplated by such loans, the number actually receiving 
service as a result of such loans, the number of electrified and the remaining number of 
unelectrified households throughout the Nation, the amounts of usage by consumers, loan and 
other activities programmed for the ensuing year, ffild all such other information and data as will 
accurately reveal the progress being made toward the achievement of the purposes of this 
Decree; and to puhlish such report for dissemination to and use by other interested depmtments, 
agencies and instrumentalities of the National Government ffild by borrowers lmder this Decree; 
and 
(0) To exercise such powers ffild do such things as may be necessary to carry out the 
business and purposes for which the NEA was established, or which from time to time may be 
declared by the Board of Administrators to be necessary, useful, incidental or auxiliary to 
accomplish such purposes; and generally, to exercise all the powers of a corporation under the 
Corporation Law insofm' as they m'e not inconsistent with the provisions of this Decree.] 
POWERS, FUNCTIONS AND PRIVILEGES OF THE NATIONAL ELECTRIFICATION 
ADMINISTRATION.- TO STRENGTHEN THE ELECTRIC COOPERATIVES, HELP 
THEM BECOME ECONOMICALLY VIABLE AND PREPARE THEM FOR THE 
IMPLEMENTATION OF RETAIL COMPETITION AND OPEN ACCESS PURSUANT 
TO SECTION 31 
OF THE EPIRA, THE NATIONAL ELECTRIFICATION 
ADMINISTRATION IS AUTHORIZED AND EMPOWERED TO: 
(A) 
HAVE A CONTINUOUS SUCCESSION UNDER ITS CORPORATE 
NAME UNTIL OTHERWISE PROVIDED BY LAW; 
(B) 
ADOPT AND USE A SEAL AND ALTER IT AT ITS PLEASURE; 
29 
(C) 
SUE AND BE SUED IN ANY COURT, PROVIDED THAT NEA SHALL 
30 
UNLESS IT CONSENTS OTHERWISE, BE IMMUNE TO SUITS FOR ACTS EX 
31 
DELICTI; 
32 
(D) 
MAKE CONTRACTS OF EVERY NAME AND NATURE AND EXECUTE 
33 
ALL INSTRUMENTS NECESSARY OR CONVENIENT FOR THE CARRYING ON OF 
34 
ITS BUSINESS; 
6 


1 
(E) 
SUI'ERVISE THE MANAGEMENT AND OPERATIONS OF ALL 
2 
ELECTRIC COOPERATIVES; 
3 
(F) 
EXERCISE STEP-IN RIGHTS AS HEREIN DEFINED; 
4 
(G) 
I'ROVIDE 
INSTITUTIONAL, 
~FINANCIAL 
AND 
TECHNICAL 
5 
ASSISTANCE TO ELECTRIC COOPERATIVES UPON REQUEST OF THE 
6 
ELECTRIC COOPERATIVES; 
7 
(H) 
PURSUE THE TOTAL ELECTRIFICATION OF THE COUNTRY 
8 
THROUGH TIm ELECTRIC COOPERATIVES BY WAY OF ENHANCING 
9 
DISTRIBUTION DEVELOPMENT AND, IN CASE OF MISSIONARY AREAS, SHALL 
10 
BE DONE, IN COORDINATION WITH THE NATIONAL POWER CORPORATION -
11 
SMALL 
POWER 
UTILITIES 
GROUP 
(NPC-SPUG) 
WHICH 
SHALL 
BE 
12 
RESPONSIBLE FOR THE GENERATION AND TRANSMISSION REQUIREMENTS, 
13 
AS NECESSARY; 
14 
(I) 
DEVOTE ALL RETURNS FROM ITS CAPITAL INVESTMENTS TO 
15 
ATTAIN THE OBJECTIVES OF TIUS ACT; 
16 
(J) 
ENSURE THE ECONOMIC AND 
FINANCIAL VIABILITY AND 
17 
OPERATION OF ALL ELECTRIC COOPERATIVES; 
18 
(K) 
RESTRUCTURE AILING ELECTRIC COOPERATIVES WITH THE END 
19 
IN VIEW OF MAKING THEM ECONOMICALLY AND FINANCIALLY VIABLE; 
20 
(L) 
DEVELOP, SET AND ENFORCE INSTITUTIONAL AND GOVERNANCE 
21 
STANDARDS FOR THE EFFICIENT OPERATION OF ELECTRIC COOPERATIVES 
22 
SUCH AS, BUT NOT LIMITED TO, THE OBSERVANCE OF API'ROPRIATE 
23 
PROCUREMENT PROCEDURE, INCLUDING TRANSPARENT AND COMPETITIVE 
24 
BIDDING. SUCH STANDARDS SHALL BE ENFORCED THROUGH A MECHANISM 
25 
OF INCENTIVES AND DISINCENTIVES TO COMPLYING AND NON-COMPLYING 
26 
ELECTRIC COOPERATIVES, RESPECTIVELY; 
27 
(M) FORMULATE AND IMPOSE ADMINISTRATIVE SANCTIONS AND 
28 
PENALTIES AND WHEN WARRANTED, FILE CRIMINAL CASES AGAINST THOSE 
29 
WHO ARE FOUND IN VIOLATION OF ANY OF THE PROVISIONS OF THIS ACT 
30 
AND ITS IMPLEMENTING RULES AND REGULATIONS; 
31 
(N) 
SERVE 
AS 
GUARANTOR 
TO 
QUALIFIED 
ELECTRIC 
32 
COOPERATIVES IN THEIR TRANSACTIONS WITH VARIOUS PARTIES SUCH AS, 
33 
BUT NOT LIMITED TO, CO-SIGNING IN POWER SUPPLY CONTRACTS; 
34 
(0) 
GRANT 
LOANS 
TO 
ELECTRIC 
COOPERATIVES, 
FOR THE 
35 
CONSTRUCTION OR ACQUISITION, OI'ERATION AND MAINTENANCE OF SUB-
7 


TRANSMISSION 
AND 
DISTRIBUTION 
FACILITIES 
AND 
ALL 
RELATED 
2 
PROPERTIES, EQUIPMENT, MACHINERY, FIXTURES, AND MATERIALS FOR 
3 
THE PURPOSE OF SUPPLYING AREA COVERAGE SERVICE, AND THEREAFTER 
4 
TO 
GRANT 
LOANS 
}<'OR 
THE 
RESTORATION, 
IMPROVEMENT 
OR 
5 
ENLARGEMENT 011 SUCH FACILITIES OR FOR SUCH OTHER PURPOSES AS 
6 
MAY BE DEEMED NECESSARY; 
7 
(P) 
SUBJECT TO THE PRIOR APPROVAL AND/OR OPINION OF THE 
8 
MONETARY BOARD, BORROW FUNDS FROM ANY SOURCE, PRIVATE OR 
9 
GOVERNMENT, FOREIGN OR DOMESTIC, AND SECURE THE LENDERS 
10 
THEREOF BY PLEDGING, SHARING OR SUBORDINATING ONE OR MORE 011 
II 
THE NEA'S OWN LOAN SECURITIES; 
12 
(Q) 
EXERCISE PRIMARY AND EXCLUSIVE JURISDICTION IN THE 
13 
ADJUDICATION 
OF 
COMPLAINTS 
AGAINST 
ELECTRIC 
COOPERATIVE 
14 
OFFICERS, ELECTION DISPUTES AND ALL MATTERS RELATING TO THE 
15 
EFFECTIVE IMPLEMENTATION OF THE I'ROVISIONS OF THIS ACT; 
16 
(R) 
AS 
A 
QUASI-JUDICIAL 
AGENCY, 
DEPUTIZE 
LOCAL 
LAW 
17 
ENFORCEMENT AGENCIES TO ENFORCE OR IMPLEMENT ITS ORDERS OR 
18 
DECISIONS, WITH THE POWER TO CITE FOR CONTEMPT ANY PARTY OR 
19 
WITNESS TO ANY CASE BEFORE IT FOR CONTUMACIOUS CONDUCT; AND 
20 
(S) 
EXERCISE SUCH POWERS AND DO SUCH THINGS AS MAY BE 
21 
NECESSARY TO CARRY OUT THE BUSINESS AND PURPOSES FOR WHICH THE 
22 
NEA WAS ESTABLISHED, OR WHICH FROM TIME TO TIME MAYBE DECLARED 
23 
BY THE BOARD OF ADMINISTRATORS AS NECESSARY, USEFUL, INCIDENTAL 
24 
OR AUXILIARY TO ACCOMPLISH SUCH PURPOSES. 
25 
FOR THIS PURPOSE, THE AUTHORIZED CAPITAL STOCK OF THE NEA IS 
26 
HEREBY INCREASED TO TWENTY-FIVE BILLION PESOS (P25,OOO,OOO,OOO.00) 
27 
DIVIDED INTO TWO HUNDRED FIFTY MILLION SHARES WITH A PAR VALUE 
28 
OF ONE HUNDRED PESOS (1'100.00). 
29 
SEC. 6. A new section, to be designated as Section 4-A, is hereby inserted under the 
30 
same Presidential Decree, to read as follows: 
31 
"SEC. 4-A. SUPERVISORY POWERS OF THE NATIONAL f-TECTRIFlCATION 
32 
ADMINISTRATION OVER ELECTRIC COOPERATIVES.- IN THE EXERCISE OF ITS 
8 


1 
POWER OF SUPERVISION OVER ELECTRIC COOPERATIVES, THE NEA SHALL 
2 
HAVE THE FOLLOWING POWERS: 
3 
(A) 
ISSUE ORDERS, RULES AND REGULATIONS, MOTU PROPRIO OR 
4 
UPON PETITION OF THIRD PARTIES, TO CONDUCT INVESTIGATIONS, 
5 
REFERENDA AND OTHER SIMILAR ACTIONS ON ALL MATTERS AFFECTING 
6 
THE ELECTRIC COOPERATIVES; 
7 
(B) 
ISSUE PREVENTIVE OR DISCIPLINARY MEASURES, INCLUDING 
8 
BUT NOT LIMITED TO, SUSPENSION OR REMOVAL AND REPLACEMENT OF 
9 
ANY OR ALL OF THE MEMBERS OF THE BOARD OF DIRECTORS, OFFICERS OR 
10 
EMPLOYEES OF THE ELECTRIC COOPERATIVE, AS THE NEA MAY DEEM FIT 
11 
AND NECESSARY AND TO TAKE ANY OTHER REMEDIAL MEASURES AS THE 
12 
LAW OR ANY AGREEMENT OR ARRANGEMENT WITH NEA MAY PROVIDE, TO 
13 
ATTAIN THE OBJECTIVES OF THIS ACT; AND 
14 
(C) 
API'OINT INDEPENDENT BOARD OF DIRECTORS IN nIE ELECTRIC 
15 
COOPERATIVE. 
16 
THE NEA SHALL, IN THE EXERCISE OF ITS SUPERVISORY AND 
17 
DISCIPLINARY l'OWERS UNDER THIS ACT, STRICTLY OBSERVE DUE PROCESS 
18 
OF LAW." 
19 
SEC. 7. A new section, to be designated as Section 4-B, is hereby inserted under the 
20 
same Presidential Decree, to read as follows: 
21 
"SEC. 4-B. STEP-IN RIGHTS IN CASES OF AILING COOPERATIVES.- THE 
22 
NEA SHALL IMMEDIATELY STEP-IN AND TAKE OVER FROM ITS BOARD THE 
23 
OPERATIONS 
OF 
ANY 
AILING 
ELECTRIC 
COOPERATIVE. 
WITHIN 
A 
24 
REASONABLE l'ERIOD AFTER TAKE-OVER, THE NEA MAY CONVERT THE 
25 
AILING COOPERATIVE TO EITHER A STOCK COOPERATIVE REGISTERED 
26 
WITH THE CDA OR A STOCK CORPORATION REGISTERED WITH THE 
27 
SECURITIES AND EXCHANGE COMMISSION. 
28 
THE NEA SHALL, IN DETERMINING THE PROPRIETY OF THE 
29 
CONVERSION, BE GUIDED BY THE ABILITY OF THE MEMBER-CONSUMERS OF 
30 
SAID ELECTRIC COOPERATIVE TO PAY FOR THEIR SHARES IN THE STOCK 
31 
COOPERATIVE OR STOCK CORPORATION. 
9 


1 
THE NEA MAY APPOINT OR ASSIGN THIRD PERSONS TO THE BOARD OF 
2 
THE ELECTRIC COOI'ERATIVE UNTIL THE NEA DECIDES THAT THE 
3 
ELECTION OF A NEW BOARD OF DIRECTORS TO MANAGE THE ELECTRIC 
4 
COOPERATIVE IS NECESSARY. 
THE NEA MAY CREATE A MANAGEMENT 
5 
TEAM FOR THE PURPOSE. 
6 
THE NEA SHALL, IN THE EXERCISE OF ITS STEP-IN RIGHTS UNDER THIS 
7 
ACT, STRICTLY OBSERVE DUE PROCESS OF LAW. THE STEP-IN RIGHTS MAY 
8 
ONLY BE EXERCISED BY THE NEA IN CASE OF FAILURE OF THE ELECTlliC 
9 
COOPERATIVE TO MEET OPERATIONAL AND FINANCIAL STANDARDS SET BY 
10 
THE NEA OR IN OTHER ANALOGOUS INSTANCES SET FORTH IN THE 
11 
IMPLEMENTING RULES AND REGULATIONS OF THIS ACT." 
12 
SEC. 8. A new section, to be designated as Section 4-C, is hereby inserted under the 
13 
same Presidential Decree, to read as follows: 
14 
"SEC. 4-C. INJUNCTION OR TEMPORARY RESTRAINING ORDER. -
NO 
15 
INJUNCTION OR TEMPORARY RESTRAINING ORDER SHALL BE ISSUED 
16 
AGAINST THE IMI'LEMENTATION OF ANY ORDER, RULING OR DECISION OF 
17 
THE NEA, EXCEI'T BY THE COURT OF APPEALS, AND ONLY UPON THE 
18 
POSTING OF A BOND SUFFICIENT TO COVER TI-IE LIABILITIES AND 
19 
EXPENDITURES ARISING DUlliNG THE PENDENCY OF THE WRIT OR 
20 
INJUNCTION OR TEMPORARY RESTRAINING ORDER; PROVIDED, THAT THE 
21 
INJUNCTION SHALL ONLY BE EFFECTIVE FOR A PERIOD NOT EXCEEDING 
22 
SIXTY (60) DAYS." 
23 
CHAPTER III 
24 
ELECTRIC COOPERATIVES 
25 
SEC. 9. Section 16, Paragraph (j), of Presidential Decree No. 269, as amended, is hereby 
26 
fUlther amended, to read as follows: 
27 
"SEC. 16. Powers. A cooperative is hereby vested with all powers necessary or 
28 
convenient for the accomplishment of its corporate purpose and capable of being delegated by 
29 
the President 01' the National Assembly when it comes into existence; and no enumeration of 
30 
particular powers hereby granted shall be construed to impair any general grant of power herein 
10 


I 
contained, nor to limit any such grant to a power or powers of the same class as those so 
2 
enumerated. Such powers shall include but not be limited to, the power: 
3 
XXX XXXXXX 
4 
(j) To construct, [maintain] ACQUIRE, OWN, [and] operate AND MAINTAiN electric 
5 
SUB-transmission and distribution lines along, upon, under and across publicly owned lands and 
6 
public thoroughfares, including, without limitation, all roads, highways, streets, alleys, bridges 
7 
and causeways[;]. [Provided, That such shall not prevent or unduly impair the primary public 
8 
uses to which such lands and thoroughfares are otherwise devoted] IN THE EVENT OF THE 
9 
NEED OF SUCH LANDS AND THOROUGHFARES FOR THE PRIMARY PURPOSE 
10 
OF THE GOVERNMENT, THE ELECTRIC COOPERATIVE SHALL BE PROPERLY 
11 
COMPENSATED; 
12 
(J-l) TO CONSTRUCT, ACQUIRE, OWN, OPERATE AND MAINTAIN 
13 
GENERATING FACILITIES WITHIN ITS FRANCHISE AREA. IN PURSUANCE 
14 
THEREOF, WHERE AN ELECTRIC COOPERATIVE PARTICIPATES IN A BID ON 
15 
AN EXISTING NPC-SPUG GENERATING FACILITY, ITS QUALIFIED BID SHALL 
16 
BE GIVEN PREFERENCE IN CASE OF A TIE; PROVIDED, HOWEVER, THAT IN 
17 
CASES WHERE THERE IS NO OTHER QUALIFIED BIDDER, THE LONE BID 
18 
SHALL REMAIN AS VALID BASIS FOR THE DETERMINATION OF THE FINAL 
19 
AWARD SUBJECT TO THE FOLLOWING CONDITIONS: 
20 
A) BID OFFER IS NOT LOWER THAN THE VALUATION OF THE ASSETS 
21 
USING COMMISSION ON AUDIT (COA) RULES AND REGULATIONS; 
22 
B) ELECTRIC COOPERATIVE IS PREPARED TO FULLY TAKE OVER THE 
23 
GENERATION FUNCTION OF THE AREA FROM THE NPC-SPUG; AND 
24 
C) ELECTRIC COOllERATIVE SUBMITS ITS GRADUATION PROGRAM FROM 
25 
THE UNIVERSAL CHARGE FOR MISSIONARY ELECTRIFICATION (UC-ME) 
26 
SUBSIDY. 
27 
XXX XXXXXX 
28 
SEC. 10. A new section, to be designated as Section 26-A, of the same Presidential 
29 
Decree is hereby inserted, to read as follows: 
30 
"SEC. 26-A. INDEPENDENCE OF THE BOARD OF DIRECTORS AND 
31 
OFFICERS OF ELECTRIC COOPERATIVh'S.- TO ENSURE THE LONG-TERM 
32 
BUSINESS AND ECONOMIC VIABILITY OF ELECTRIC COOPERATIVES, THE 
11 


MANAGEMENT, OPERATIONS AND STRATEGIC PLANNING OF ELECTRIC 
2 
COOPERATIVES SHALL, AS MUCH AS PRACTICABLE, BE INSULATED FROM 
3 
LOCAL POLITICS. 
4 
TOWARDS THIS END, NO PERSON SHALL BE ELECTED OR APPOINTED 
5 
AS AN OFFICER OR BE ELIGIBLE TO RUN AS A BOARD MEMBER OF AN 
6 
ELECTRIC COOPERATIVE IF: 
7 
(A) 
SUCH PERSON OR HIS OR HER SPOUSE HOLDS ANY PUBLIC 
8 
OFFICE; 
9 
(B) 
SUCH PERSON OR HIS OR HER SPOUSE HAS BEEN A CANDIDATE 
10 
IN THE LAST PRECEDING LOCAL OR NATIONAL ELECTIONS; 
11 
(C) 
SUCH PERSON HAS BEEN CONVICTED BY FINAL JUDGMENT OF A 
12 
CRIME INVOLVING MORAL TURPITUDE; 
13 
(D) 
SUCH PERSON HAS BEEN TERMINATED FOR CAUSE FROM PUBLIC 
14 
OFFICE OR PRIVATE EMPLOYMENT; 
15 
(E) 
SUCH PERSON IS RELATED TO ANY MEMBER OF THE ELECTRIC 
16 
COOPERATIVE 
BOARD 
OF DIRECTORS, 
GENERAL 
MANAGER 
AND 
17 
DEPARTMENT MANAGERS WITHIN THE FOURTH CIVIL DEGREE OF 
18 
CONSANGUINITY OR AFFINITY; 
19 
(F) 
SUCH PERSON IS A REPRESENTATIVE OF A JURIDICAL PERSON; 
20 
AND 
21 
(G) 
SUCH PERSON IS EMPLOYED BY OR FINANCIALLY INTERESTED 
22 
IN A COMI'ETING ENTERPRISE OR A BUSINESS SELLING ELECTRIC 
23 
ENERGY OR ELECTRICAL HARDWARE TO THE COOPERATIVE OR DOING 
24 
BUSINESS WITH THE COOPERATIVE, INCLUDING THE USE OR RENTAL OF 
25 
POLES." 
26 
SEC. 11. A new section, to be designated as Section 26-B, is hereby inserted under the 
27 
same Presidential Decree, to read as follows: 
28 
"SEC. 
26-B. 
FIT AND PROPER RULE.-
TO ENSURE 
THAT 
THE 
29 
MANAGEMENT AND OPERATIONS OF ELECTRIC COOPERATIVES ARE 
30 
CARRIED OUT WITH DUE REGARD TO ITS ECONOMIC VIABILITY, THE NEA 
31 
SHALL PRESCRIBE, PASS UPON AND REVIEW THE QUALIFICATIONS AND 
32 
DISQUALIFICATIONS OF INDIVIDUALS APPOINTED OR ELECTED TO 
33 
ELECTRIC COOPERATIVES AND DISQUALIFY THOSE FOUND UNFIT. 
12 


1 
A 
CANDIDATE'S 
INTEGRITY, 
EXPERIENCE, 
EDUCATION, 
2 
COMPETENCE AND PROBITY SHALL BE CONSIDERED IN DETERMINING 
3 
WHETHER HE/SHE SHALL BE FIT AND PROPER TO BECOME A DIRECTOR 
4 
OR OFFICER OF THE ELECTIUC COOPERATIVE. 
5 
FOR THIS 
PURPOSE, TI-IE 
MINIMUM 
QUALIFICATIONS 
OF A 
6 
DIRECTOR OR OFFICER OF THE ELECTRIC COOPERATIVE SHALL BE AS 
7 
FOLLOWS: 
8 
(A) 
HE OR SHE IS A FILIPINO CITIZEN; 
9 
(B) 
HE OR SHE IS A GRADUATE OI? A 4-YEAR COURSE; 
10 
(C) 
lIE OR SHE IS BETWEEN TWENTY-ONE (21) AND SEVENTY (70) 
11 
YEARS OLD, ON THE DATE OF ELECTION; 
12 
(D) 
HE OR SHE IS OF GOOD MORAL CHARACTER; 
13 
(E) 
HE OR SHE IS A MEMBER OF THE ELECTRIC COOPERATIVE IN 
14 
GOOD STANDING FOR THE LAST FIVE (5) 
YEARS IMMEDIATELY 
15 
PRECEDING THE ELECTION OR APPOINTMENT; 
16 
(F) 
HE OR SHE IS AN ACTUAL RESIDENT AND CONSUMER IN THE 
17 
DISTRICT THAT HE OR SHE SEEKS TO REPRESENT FOR AT LEAST TWO (2) 
18 
YEARS IMMEDIATELY PRECEDING THE ELECTION; AND 
19 
(G) 
HE OR SHE HAS ATTENDED AT LEAST TWO (2) ANNUAL GENERAL 
20 
MEMBERSHIP ASSEMBLIES (AGMA) FOR THE LAST FIVE (5) YEARS 
21 
IMMEDIATELY PRECEDING THE ELECTION OR APPOINTMENT. 
22 
THE NEA MAY, AFTER DUE NOTICE TO THE BOARD OF DIRECTORS AND 
23 
OFFICERS OF THE ELECTRIC COOPERATIVE, DISQUALIFY, SUSPEND OR 
24 
REMOVE ANY DIRECTOR OR OFFICER, WHO COMMITS ANY ACT WHICH 
25 
RENDERS HIM UNFIT FOR THE POSITION." 
26 
SEC. 12. Section 32 of Presidential Decree No. 269, as amended, is hereby further 
27 
amended, to read as follows: 
28 
[Sec. 32. Conversion of Existing Corpora/ion. Any corporation heretofore organized or 
29 
registered under the Philippine Non-Agricultural Cooperative Act and supplying or having the 
30 
corporate power to supply electric energy may convert itself into a cooperative under this Decree 
31 
by complying with the following requirements, and shall thereupon become the subject to this 
32 
Decree with the same effect as if originally organized hereunder: 
13 


I 
(a) The proposition for the conversIon of such corporation and proposed articles of 
2 
conversion to give effect thereto shall be submitted to a meeting of the members or stockholders 
3 
of such corporation, the notice of which shall have attached thereto a copy of the proposed 
4 
articles of conversion or an accurate summary thereof. 
5 
(b) If the proposition for the conversion and the proposed articles of conversion, with any 
6 
amendments, are approved by the affirmative vote of not less than two-thirds of the total votes 
7 
cast thereon by members at such meeting, and/or, if such corporation is a stock corporation or 
8 
has both members and voting stockholders, by the affirmative vote of the holders of not less than 
9 
two-thirds of those shares of the capital stock of such corporation represented at such meeting 
10 
and voting thereon, articles of conversion in the form approved shall be executed and 
11 
acknowledged on behalf of such corporation by its president or vice-president and its seal shall 
12 
be affixed thereto and attested by its secretary. The articles of conversion shall recite that they 
13 
are executed pursuant to this Decree and shall state: (1) the name of the corporation and the 
14 
address of its principal office prior to the conversion into a cooperative; (2) a statement that such 
15 
corporation elects to become a cooperative, non-profit, membership corporation subject to this 
16 
Decree; (3) its name as a cooperative; (4) the addresses of the principal office of the cooperative; 
17 
and (5) the names and address of the directors of the cooperative, and (6) the manner in which 
18 
members or stockholders of such corporation mayor shall become members of the cooperative; 
19 
and may contain any other provisions not inconsistent with this Decree that are deemed 
20 
necessary or advisable for the conduct of the business of the cooperative. The president or vice 
21 
president executing such articles of conversion shall.make and annex thereto an affidavit stating 
22 
that the provisions of this section were duly complied with in respect to such articles. The 
23 
articles of conversion shall be deemed to be the articles of incorporation of the cooperative.] 
24 
"SEC. 32. REGISTRATION OF ALL ELECTRIC COOPERATIVES.-
ALL 
25 
ELECTRIC COOPERATIVES MAY CHOOSE TO REMAIN AS A NON-STOCK, NON-
26 
PROFIT COOPERATIVE OR CONVERT INTO AND REGISTER AS: (A) A STOCK 
27 
COOPERATIVE UNDER THE COOPERATIVE DEVELOPMENT AUTHORITY 
28 
(CDA); OR (B) A STOCK CORPORATION UNDER THE SECURITIES AND 
29 
EXCHANGE COMMISSION (SEC), IN ACCORDANCE WITH THE GUIDELINES TO 
30 
BE INCLUDED IN THE IMPLEMENTING RULES AND REGULATIONS (IRR) OF 
31 
THIS ACT. 
32 
SUCH 
CHOICE 
SHALL 
CARRY 
WITH 
IT 
THE 
ATTENDANT 
33 
REQUIREMENTS OF COMPLIANCE WITH THE LAWS AND REGULATORY 
14 


1 
GUIDELINES 
GOVEHNING 
THE RESPECTIVE 
GOVERNMENT 
AGENCIES 
2 
HAVING JURISDICTION OVER THEIR REGISTRATION. 
3 
REGARDLESS OF THE CHOICE MADE, THE NEA SHALL HAVE THE 
4 
AUTHORITY OVER ELECTRIC COOPERATIVES, WHETHER STOCK OR NON-
S 
STOCK, TO REQUIRE THE SUBMISSION OF REPORTORIAL REQUIREMENTS AS 
6 
MAY BE NECESSARY RELATIVE TO THEIR OPERATIONS AS ELECTRIC 
7 
DISTRIBUTION UTILITIES, INCLUDING BUT NOT LIMITED TO: 
8 
(A) 
MONTHLY FINANCIAL AND STATISTICAL REPORT (MFSR); 
9 
(B) 
MONTHLY SEPARATE MFSR, MONTHLY ENGINEERING REPORT 
10 
(MER) AND BARANGAY AND SITIO ELECTRIFICATION REPORT IcOR ELECTRIC 
11 
COOPERATIVES ON GRID WITH ISOLATED AREA/S SERVED BY NPC-SPUG; 
12 
(C) 
MONTHLY STATUS OF BARAN GAY AND SITIO ENERGIZATION 
13 
AND HOUSE CONNECTIONS; 
14 
(D) 
MONTHLY 
INSTITUTIONAL 
SERVICES 
DEPARTMENT 
(ISD) 
15 
REPORT; 
16 
(E) 
MONTHLY PERFORMANCE STANDARD MONITORING REPORT 
17 
(PSMR); 
18 
(F) 
MONTHLY SUMMARY OF COMPLAINTS RECEIVED AND ACTED 
19 
UPON; 
20 
(G) 
MONTHL Y REPORT ON COMPLIANCE WITH THE GRID AND 
21 
DISTRIBUTION CODE; 
22 
(H) 
MONTHLY ENGINEERING REPORT (MER); 
23 
(I) 
QUARTEHLY REPORT ON POWER SUPPLY CONTRACTS; 
24 
(J) 
ANNUAL WORK PLAN; 
25 
(K) 
ANNUAL DISTRIBUTION DEVELOPMENT PLAN (DDI'); 
26 
(L) 
5-YEAR INVESTMENT PLAN SUBMITTED ANNUALLY; 
27 
(M) 
ANNUAL CASH OPERATING BUDGET (COB); 
28 
(N) 
AUDITED FINANCIAL STATEMENTS; 
29 
(0) 
ANNUAL COLLECTIVE BARGAINING AGREEMENT (CBA) OR 
30 
COLLECTIVE NEGOTIATION AGREEMENT (CNA); 
31 
(I') 
COPY OF CAPITAL EXPENDITURE (CAPEX) AND OPERATING 
32 
EXPENDITURE (OPEX) PLANS. 
33 
LIKEWISE, THE SUPERVISORY AND OVERSIGHT FUNCTIONS OF THE 
34 
NEA, AS MAY BE DETAILED IN THIS ACT AND ITS nill, SHALL BE AI'PLlCABLE 
35 
TO BOTH STOCK AND NON-STOCK COOPERATIVES. 
15 
' 


1 
ELECTRIC COOPERATIVES WHICH REGISTER WITH THE CDA SHALL 
2 
CONTINUE TO ENJOY THE BENEFITS UNDER THIS ACT. 
3 
EXISTING 
ELECTRIC 
COOPERATIVES 
MAY 
LIKEWISE 
OPT 
TO 
4 
REGISTER 
AS 
STOCK 
CORPORATIONS 
WITH 
THE 
SECURITIES 
AND 
5 
EXCHANGE 
COMMISSION; 
PROVIDED, 
HOWEVER, 
THAT 
ELECTRIC 
6 
COOPERATIVES REGISTERED WITH THE SECURITIES AND EXCHANGE 
7 
COMMISSION SHALL NO LONGER ENJOY THE INCENTIVES PROVIDED FOR IN 
8 
THIS ACT. 
9 
DESPITE THE REGISTRATION OF THE ELECTRIC COOPERATIVES 
10 
UNDER THE CDA OR SEC, THE NEA SHALL RETAIN ITS SUPERVISORY AND 
11 
DISCIPLINARY POWER OVER THEM IN THE CONDUCT OF ITS OPERATION AS 
12 
ELECTRIC DISTRIBUTION UTILITIES." 
13 
SEC. 13. A new section, to be designated as Section 32-A, of the same Presidential 
14 
Decree is hereby inserted to read as follows: 
15 
"SEC. 32-A. INCENTIVES OF ELECTRIC COOPERATIVES.- CONSISTENT 
16 
WITH THE DECLARED POLICY OF THIS ACT, ELECTRIC COOPERATIVES 
17 
WHICH COMI'LY WITH THE FINANCIAL AND OPERATIONAL STANDARDS 
18 
SET BY THE NEA SHALL ENJOY THE FOLLOWING INCENTIVES: 
19 
(A) TO BE ENTITLED TO CONGRESSIONAL ALLOCATIONS, GRANTS, 
20 
SUBSIDIES 
AND 
OTHER 
FINANCIAL 
ASSISTANCE 
FOR 
RURAL 
21 
ELECTRIFICATION; 
22 
(B) TO RECEIVE ALL SUBSIDIES, GRANTS, AND OTHER ASSISTANCE 
23 
WHICH SHALL FORM PART OF THE DONATED CAPITAL AND FUNDS OF 
24 
THE ELECTRIC COOPERATIVES, AND AS SUCH, IT SHALL NOT BE SOLD, 
25 
TRADED NOR DIVIDED INTO SHARE HOLDINGS AT ANY TIME. THESE 
26 
DONATED CAPITAL AND FUNDS SHALL BE APPRAISED AND VALUED FOR 
27 
THE SOLE PURPOSE OF DETERMINING THE EQUITY PARTICIPATION OF 
28 
THE MEMBERS; PROVIDED, THAT IN CASE OF DISSOLUTION OR 
29 
CONVERSION OF THE ELECTRIC COOPERATIVE, SAID DONATED CAPITAL 
30 
AND FUNDS SHALL BE SUBJECT TO ESCHEAT; AND 
31 
(C) TO AVAIL OF THE PREFERENTIAL RIGHTS GRANTED TO 
32 
COOPERATIVES UNDER REPUBLIC ACT NO. 7160, OTHERWISE KNOWN AS 
33 
THE "LOCAL GOVERNMENT CODE", AND OTHER RELATED LAWS. 
16 


1 
AS A FURTHER INCENTIVE, THE NEA MAY PRIORITIZE THE GRANT 
2 
OF INCENTIVES IN FAVOR OF ELECTRIC COOPERATIVES THAT ARE 
3 
MANAGED EFFECTIVELY AND EFFICIENTLY AND COMPLY CONSISTENTLY 
4 
WITH ITS MANDATES AND DIRECTIVES." 
5 
CHAPTER IV 
6 
FINAL PROVISIONS 
7 
SEC. 14. A new section, to be designated as Section 64-A, of the same Presidential 
8 
Decree is hereby inserted, to read as follows: 
9 
"SEC. 64-A. PENALTIES. - ANY PERSON WHO WILLFULLY VIOLATES ANY 
10 
RULE OR REGULATION PROMULGATED PURSUANT TO THE AUTHORITY 
11 
GRANTED IN THIS ACT SHALL, UPON' CONVICTION, BE PUNISHED BY A 
12 
FINE OF NOT LESS THAN FIFTY THOUSAND PESOS (P50,000.00) BUT NOT 
13 
MORE 
THAN FIVE HUNDRED THOUSAND PESOS (P500,000.00) OR BY 
14 
IMPRISONMENT OF NOT LESS THAN SIX (6) MONTHS BUT NOT MORE THAN 
15 
ONE (1) YEAR, OR BOTH, AT THE DISCRETION OF THE COURT; PROVIDED, 
16 
THAT IF THE VIOLATION IS COMMITTED BY A JURIDICAL PERSON, THE 
17 
PENALTY HEREIN PRESCRIBED SHALL BE IMPOSED UPON THE OFFICIAL 
18 
AND/OR EMPLOYEE THEREOF RESPONSIBLE FOR THE VIOLATION; 
19 
PROVIDED, FURTHER, THAT IF THE VIOLATION IS COMMITTED BY A 
20 
GOVERNMENT 
OFFICIAL 
OR 
EMPLOYEE, 
INCLUDING 
THOSE 
IN 
21 
GOVERNMENT-OWNED OR -CONTROLLED CORPORATIONS, SUCH PERSON 
22 
SHALL, IN ADDITION TO THE PENALTY PROVIDED HEREIN, BE SUBJECTED 
23 
TO ADMINISTRATIVE DISCIPLINARY ACTION," 
24 
SEC. 15. A new section, to be designated as Section 64-B, of the same Presidential 
25 
Decree is hereby inserted, to read as follows: 
26 
"SEC. 64-B. CONGRESSIONAL OVERSIGHT. - UPON THE EFFECTIVITY 
27 
OF THIS ACT, THE JOINT CONGRESSIONAL POWER COMMISSION 
28 
CREATED UNDER SECTION 62 OF REPUBLIC ACT NO. 9136 SHALL 
29 
EXERCISE OVERSIGHT POWERS OVER THE IMPLEMENTATION OF THIS 
30 
ACT." 
17 


1 
SEc' 16. Implementing Rules and Regulations. -
Within sixty (60) days from the 
2 
effectivity of this Act, the DOE shall, in coordination with the NEA and the CDA, al1d in 
3 
consultation with the electric cooperatives, issue such rules and regulations as may be necessary 
4 
to implement this Act. 
5 
SEC. 17. Separability Clause. - If any provision of this Act is declared invalid or 
6 
unconstitutional, the other provisions not affected thereby shall remain valid and subsisting. 
7 
SEC. 18. Repealing Clause.- ARTICLE 132 (3) OF REPUBLIC ACT 9520 AND 
8 
SECTION 30 OF REPUBLIC ACT 9136 (EPIRA) ON NEA'S AUTHORIZED CAPITAL 
9 
STOCK ARE HEREBY REPEALED. Any OTHER provision of law, presidential decree, 
10 
executive order, or rules and regulations inconsistent with the provisions of this Act or with the 
11 
rules mld regulations issued pursum1t thereto [is] ARE hereby repealed or modified accordingly. 
12 
SEC. 19. EjJectivity.- This Act shall talee effect on the fifteenth day following its 
13 
publication in at least two (2) newspapers of general circulation. 
14 
Approved, 
18