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Cooperative: An Overview

Cooperatives are associations that are voluntarily joined by people with common interests. They operate according to cooperative principles like democratic control by members, member economic participation, and concern for the community. The main laws governing cooperatives in the Philippines are the Cooperative Code and laws establishing the Cooperative Development Authority. Cooperatives can be formed for credit, marketing, housing, and other purposes. They provide economic benefits like loans and social benefits like solving community problems.

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152 views27 pages

Cooperative: An Overview

Cooperatives are associations that are voluntarily joined by people with common interests. They operate according to cooperative principles like democratic control by members, member economic participation, and concern for the community. The main laws governing cooperatives in the Philippines are the Cooperative Code and laws establishing the Cooperative Development Authority. Cooperatives can be formed for credit, marketing, housing, and other purposes. They provide economic benefits like loans and social benefits like solving community problems.

Uploaded by

Janet T. Cometa
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Cooperative: An Overview

What Is A Cooperative?
A cooperative is an autonomous and duly
registered association of persons with a
common bond of interest, who have
voluntarily joined together to achieve a
lawful common social or economic end,
making equitable to contribution to the
capital required and accepting a fair share
of the risks and benefits of the undertaking
in accordance with universally accepted
cooperative principle.
What are the Principles of
Cooperativism?
Voluntary and open membership
Democratic member control
Member economic participation
Autonomy and independence
Cooperation among cooperatives
Cooperative education
Concern for community
What are the basic laws that govern
organization and administration of
cooperatives in the Philippines ?
Republic Act 6938 known as
Cooperative Code of the Philippines .
Republic Act 6939 creating the
Cooperative Development Authority
Republic Act No. 9520 (“Philippine
Cooperative Code of 2008″)
Purpose of Republic Act No.
9520 (“Philippine Cooperative
Code of 2008″)
to foster the creation and growth of
cooperatives as a practical vehicle for
promoting self-reliance and
harnessing people power towards the
attainment of economic development
and social justice
What Are The Kinds Of
Cooperative?
Credit Cooperative- promotes thrift and savings
among its members and creates funds in order to
grant loans for productivity
Consumer Cooperative- the primary purpose is
to procure and distribute commodities to member
and non-members;
Producers Cooperative - undertakes joint
production whether agricultural or industrial;
Marketing Cooperative - Engages in the supply
of production inputs to members and markets their
products
Service Cooperative- engages in medical, and
dental care, hospitalization, transportation,
insurance, housing , labor, electric light and power,
communication and other services; and
Advocacy Cooperative - A primary cooperative
which promotes and advocates cooperativism
among its members and the public through
socially-oriented projects, education and training,
research and communication, and other similar
activities to reach out to its intended beneficiaries.
Agrarian Reform Cooperative - Organized by
marginal farmers majority of which are agrarian
reform beneficiaries for the purpose of developing
an appropriate system of land tenure, land
development, land consolidation or land
management in areas covered by agrarian reform.
Cooperative Bank - Organized for the primary
purpose of providing a wide range of financial
services to cooperatives and their members.
Dairy Cooperative - One whose members are
engaged in the production of fresh milk which may
be processed and/or marketed as dairy products.
Education Cooperative - Organized for the
primary purpose of owning and operating licensed
educational institutions notwithstanding the
provisions of Republic Act No. 9155, otherwise
known as the Governance of Basic Education Act
of 2001.
Electric Cooperative. Organized for the primary
purposed of undertaking power generations,
utilizing renewable energy sources, including
hybrid systems, acquisition and operation of sub
transmission or distribution to its household
members.
Financial Service Cooperative. One organized
for the primary purpose of engaging in savings
and credit services and other financial services.
Fishermen Cooperative. Organized by
marginalized fishermen in localities whose
products are marketed either as fresh or
processed products;
Health Services Cooperative - Organized for the
primary purpose of providing medical, dental and
other health services.
Housing Cooperative - Organized to assist or
provide access to housing for the benefit of its
regular members who actively participate in the
savings program for housing. It is co-owned and
controlled by its members.
Insurance Cooperative - Engaged in the
business of insuring life and poverty of
cooperatives and their members.
Transport Cooperative - Includes land and sea
transportation, limited to small vessels, as defined
or classified under the Philippine maritime laws,
organized under the provisions of this Code;
Water Service Cooperative - Organized to own,
operate and manage waters systems for the
provision and distribution of potable water for its
members and their households.
Workers Cooperative - Organized by workers,
including the self-employed, who are at same time
the members and owners of the enterprise. Its
principal purpose is to provide employment and
business opportunities to its members and
manage it in accordance with cooperative
principles.
Multipurpose Cooperative -Combines two or
more of the business activities of different types of
cooperatives.
Categories of Cooperative
 According to membership and territory, the following are the
categories of cooperatives:

In terms of membership:
I .Primary -The members of which are natural persons of
legal age;
II .Secondary- The members of which are primaries;
III. Tertiary - The member of which are secondaries upward
to one or more apex organizations. Cooperatives whose
members are cooperatives are called federations or unions.

In terms of territory, cooperatives are categorized


according to areas of operation which may not be coincide
with the political subdivisions of the country.
What are the General Steps in
Forming a Cooperative?
First, get organized
Second, prepare a general statement
called an economic survey
Third, draft the cooperatives by-laws
Fourth, draft the articles of
cooperation
Sixth, register your cooperative with
the Cooperative Development
Authority (CDA)
In every step, you may consult the CDA.
The CDA emphasizes education as a key to the success of cooperatives.
Capital
The minimum paid-up share capital is now
PhP15,000 (the minimum under the old law is only
PhP2,000), subject to increase by the CDA upon
consultation with the cooperative sector and the
NEDA.
The par value of shares of a primary cooperative
shall not exceed PhP1,000.
No member of primary cooperative other than
cooperative itself shall own or hold more than 10%
of the share capital of the cooperative.
Who May Become Members of a
Primary Cooperative?
If you are a Filipino of legal age, you can be a
coop member if you meet the qualifications
prescribed by the coop's by laws.

The board of directors act on application for


membership.

A member may exercise his rights only after


having paid the fees for membership and acquired
shares in the cooperative,
What are the Kinds of
Membership in the Cooperative?
A cooperative has two kinds of members;
regular members and associate
members.
A regular member is entitled to all the rights
and privileged of membership as stated in
the Cooperative Code and the coops by-
laws.
An associate member has no right to vote
and to be voted upon and is entitled to
such rights and privileged provided by the
cooperatives by laws.
What is the Minimum Number of
Members in a Cooperative?
Fifteen (15) natural persons of legal
age who are citizens of the
Philippines
Can Government Officers and
Employees Join a Cooperative?
Yes, provided that:
Any officer of the government of the CDA shall
be disqualified to be elected or appointed to
any position in a cooperative;
Elected officials of the government, except
barangay officials, shall be ineligible to become
officers and directors of cooperatives; and
Any government employee may, in the
discharge of his duties as member in the
cooperative, use official time provided that the
operations of the office where he works are not
adversely affected.
Tax Treatment of Cooperative
Cooperatives which do not transact any
business with non-members or the general
public shall not be subject to any taxes and
fees imposed under the internal revenue
laws and other tax laws. Cooperatives
transacting business with both members
and non-members shall be subject to
another set of rules, but transactions with
members shall remain to be non-taxable.
What is an Economic Survey?
An economic survey is a general statement
describing the structure, purpose,
economic feasibility of the proposed
cooperative, area of operation, size of
membership and other pertinent data.
It is, in fact a project feasibility study
The structure describes the kind of
cooperative being set, up whether it is
primary, secondary or tertiary and whether
it is a credit, consumer transport or any
other type of coop.
What Constitutes A Quorum?

Unless the by laws define it


otherwise, a quorum consist of 25%
of all the regular members entitled to
vote. For the board of directors a
simple majority of its member makes
a quorum.
Are Cooperatives Required To Be
Audited Annually?
Yes, Cooperatives are subject to an
annual audit by an auditor who is
independent of the cooperative being
audited and of any subsidiary of the
cooperative and is a member of any
recognized professional accounting or
cooperative auditor's association with
similar qualifications.
Is There A Needed For An Annual
Report?
Yes.

An annual report about the affairs of the


cooperative must be given to each member
and to the federation/union to which it is
affiliated and the CDA every fiscal year.

Failure to file the annual report may result


in cancellation of the certificate of
registration
What are the benefits derived from
membership in cooperatives?
Economic Benefits
Members develop the habit of thrift and the
wise use of money.
Members avail of loans at reasonable rate of
interest for productive and provident purposes;
thus, increasing the members' income.
Social Benefits
Members develop awareness in solving
common problems or needs among
themselves.
Members develop the feeling of belongingness,
love and concern for fellowmen.
Membership in cooperative inculcates unified
participation in community affairs
How Much Is The Registration
Fee?
CDA Memorandum Circular No. 92-004,
effective 01 May 1992 provides that
provides that registration fee shall be one
tenth (1/10) of one percent of the paid- up
share capital with the minimum of:
P250 for new primary cooperative;
P500 for secondary cooperative,
P2,000.00 for tertiary cooperative while
laboratory cooperative is free of charge.
Cooperative Process
WELFARE

Articles of
Cooperation
GENERAL Elect/appoints Plan/formulates
BOD’s By Laws,
ASSEMBLY Committee Rules & Regulations
Officers/ Other policies
members

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