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Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE
- A cooperative is an autonomous and duly registered association of persons, with a common bond of interest, who have voluntarily joined together to achieve their social, economic, and cultural needs and aspirations by making equitable contributions to the capital required, patronizing their products and services and accepting a fair share of the risks and benefits of the undertaking in accordance with universally accepted cooperative principles.
- Although cooperatives are not primarily governed by the Corporation Code, they are also treated as a corporate entity with their own acts and liabilities.
The creation and growth of cooperatives serve as a practical vehicle for promoting self-reliance and harnessing people’s power towards the attainment of economic development and social justice.
In line with this, the State shall encourage the private sector to undertake the actual formation and organization of cooperatives and shall create an atmosphere that is conducive to the growth and development of these cooperatives.
What is a cooperative?
The law says:
A cooperative is an autonomous and duly registered association of persons, with a common bond of interest, who have voluntarily joined together to achieve their social, economic, and cultural needs and aspirations by making equitable contributions to the capital required, patronizing their products and services and accepting a fair share of the risks and benefits of the undertaking in accordance with universally accepted cooperative principles. (Section 1, Republic No. 9520)
Although cooperatives are not primarily governed by the Corporation Code, they are also treated as a corporate entity with their own acts and liabilities.
A cooperative is vested with powers and capacities. The law says:
ART. 9. Cooperative Powers and Capacities. – A cooperative registered under this Code shall have the following powers, rights and capacities:
(1) To the exclusive use of its registered name, to sue and be sued;
(2) Of succession;
(3) To amend its articles of cooperation in accordance with the provisions of this Code;
(4) To adopt bylaws not contrary to law, morals or public policy, and to amend and repeal the same in accordance with this Code;
(5) To purchase, receive, take or grant, hold, convey, sell, lease, pledge, mortgage, and otherwise deal with such real and personal property as the transaction of the lawful affairs of the cooperative may reasonably and necessarily require, subject to the limitations prescribed by law and the Constitution;
(6) To enter into division, merger or consolidation, as provided in this Code;
(7) To form subsidiary cooperatives and join federations or unions, as provided in this Code;
(8) To avail of loans, be entitled to credit and to accept and receive grants, donations and assistance from foreign and domestic sources, subject to the conditions of said loans, credits, grants, donations or assistance that will not undermine the autonomy of the cooperative. The Authority, upon written request, shall provide necessary assistance in the documentary requirements for the loans, credit, grants, donations and other financial support;
(9) To avail of preferential rights granted to cooperatives under Republic Act No. 7160, otherwise known as the Local Government Code, and other laws, particularly those in the grant of franchises to establish, construct, operate and maintain ferries, wharves, markets or slaughterhouses and to lease public utilities, including access to extension and on-site research services and facilities related to agriculture and fishery activities;
(10) To organize and operate schools in accordance with Republic Act No. 9155, Governance of Basic Education Act of 2001 and other pertinent laws; and
(11) To exercise such other powers granted by this Code or necessary to carry out its purpose or purposes as stated in its Articles of cooperation. (Section 2, Republic No. 9520)
What is the highest policy-making body of a cooperative?
The law says:
“ART. 33. Powers of the General Assembly. – The general assembly shall be the highest policy-making body of the cooperative and shall exercise such powers as are stated in this Code, in the articles of cooperation and in the bylaws of the cooperative. (Section 4, Republic No. 9520)
While the General Assembly is the highest policy-making body of the cooperative, it is the Board of Directors of a cooperative who shall be responsible for the cooperative’s strategic planning, direction-setting and policy formulation activities. (Section 4, Republic No. 9520)
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