SALIENT POINTS OF RA 9520 &

SPUD-MPC BY LAWS
Dr. Greg Baccay
What is RA 9520?
AN ACT AMENDING THE COOPERATIVE
CODE OF THE PHILIPPINES TO BE KNOWN
AS THE "PHILIPPINE COOPERATIVE CODE
OF 2008“
"Philippine Cooperative Code of 2008"
Declaration of Policy
It is the declared policy of the State 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.
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.
State recognizes the principle of subsidiarity under which the
cooperative sector will initiate and regulate within its own ranks
the promotion and organization, training and reserach, audit and
support services relative to cooperatives with government
assistance where necessary.
‘cont
The Government and all its branches, subdivisions,
instrumentalities and agencies shall ensure the
provision of technical guidance, financial assistance
and other services to enable said cooperatives to
develop into viable and responsive economic
enterprises and thereby bring about a strong
cooperative movement that is free from any conditions
that might infringe upon the autonomy or
organizational integrity of cooperatives.
SPUD-MPC Vision
“A progressive and dynamic community cooperative
generally impacting societal development and
satisfying the needs of members and other stakeholders
particularly.”
Mission
“To provide relevant quality products and services
fully satisfying members’ needs and other stakeholders
as well as providing various community related
initiatives that promote social transformation.”
Objectives
The primary goal of SPUD-MPC is to help improve the
quality of life of its members. Towards this end, the
cooperative shall:
Institutionalize a dynamic savings mobilization and capital
build-up schemes to sustain its developmental activities and
long-term investments, thereby ensuring optimum economic
benefits to the members, their families and the general
public;
Provide optimum social and economic benefits to its
members;
Teach them efficient ways of doing things in a cooperative
manner;
 Propagate cooperative practices and new ideas in business
and management;
 Allow the lower income and less privileged groups to
increase their ownership in the wealth of the nation;
 Cooperate with the government, other cooperatives and
people-oriented organizations to further the attainment of
the cooperative’s vision and mission;
 Promote and advance the economic, social and educational
status of members;
 Encourage and promote self-help or self-employment as an
engine for economic growth and poverty alleviation;
‘cont
Actively support the government and other concerned
organizations, both local and foreign in promoting
cooperatives as a practical means towards sustainable
socio-economic development under a truly just and
democratic society;
Implement policy guidelines that will ensure
transparency, equitable access to its resources and
services and promote the interests of the members; and,
Adopt such other plans as may help foster the welfare
of the members, their families and the community.
MEMBERSHIPS
"ART. 26. Kinds of Membership. – A cooperative may have
two (2) kinds of members, to wit: (1) regular members and (2)
associate members.
"A regular member is one who has complied with all the
membership requirements and entitled to all the rights and
privileges of membership. An associate member is one who has
no right to vote nor be voted upon and shall be entitled only to
such rights and privileges as the bylaws may provide:
Provided, That an associate who meets the minimum
requirements of regular membership, continues to patronize the
cooperative for two (2) years, and signifies his/her intention to
remain a member shall be considered a regular member.
ART. 28. Application
"An applicant for membership shall be deemed a member after
approval of his membership by the board of directors and shall
exercise the rights of member after having made such payments to
the cooperative in respect to membership or acquired interest in the
cooperative as may be prescribed in the bylaws. In case membership
is refused or denied by the board of directors, an appeal may be
made to the general assembly and the latter’s decision shall be final.
For this purpose, the general assembly may opt to create an appeal
and grievance committee, the members of which shall serve for a
period of one (1) year and shall decide appeals on membership
application within thirty (30) days upon receipt thereof. If the
committee fails to decide within the prescribed period, the appeal is
deemed approved in favor of the applicant.
"ART. 29. Liability of Members. – A member shall be
liable for the debts of the cooperative to the extent of
his contribution to the share capital of the cooperative.
"ART. 30. Termination of Membership. – (1) A
member of a cooperative may, for any valid reason,
withdraw his membership from the cooperative by
giving a sixty (60) day notice to the board of directors.
Subject to the bylaws of the cooperative, the
withdrawing member shall be entitled to a refund of
his share capital contribution and all other interests in
the cooperative: Provided, That such fund shall not be
made if upon such payment the value of the assets of
the cooperative would be less than the aggregate
amount of its debts and liabilities exclusive of his
share capital contribution.
"(2) The death or insanity of a member in a primary
cooperative, and the insolvency or dissolution of a
member in a secondary or tertiary cooperative may be
considered valid grounds for termination of
membership: Provided, That in case of death or
insanity of an agrarian reform beneficiary-member of a
cooperative, the next-of-kin may assume the duties and
responsibilities of the original member
"(3) Membership in the cooperative may be terminated by a
vote of the majority of all the members of the board of
directors for any of the following causes:
"(a) When a member has not patronized any of the services of
the cooperative for an unreasonable period of time as may be
previously determined by the board of directors;
"(b) When a member has continuously failed to comply with
his obligations;
"(c) When a member has acted in violation of the bylaws and
the rules of the cooperative; and
"(d) For any act or omission injurious or prejudicial to the
interest or the welfare of the cooperative.
"A member whose membership the board of directors may wish to
terminate shall be informed of such intended action in writing and
shall be given an opportunity to be heard before the said board makes
its decision. The decision of the board shall be in writing and shall be
communicated in person or by registered mail to said member and
shall be appealable within thirty (30) days from receipt thereof to the
general assembly whose decision shall be final. The general assembly
may create an appeal and grievance committee whose members shall
serve for a period of one (1) year and shall decide appeals on
membership termination. The committee is given thirty (30) days
from receipt thereof to decide on the appeal. Failure to decide within
the prescribed period, the appeal is deemed approved in favor of the
member. Pending a decision by the general assembly, the membership
remains in force.
Administration
"ART. 32. Composition of the General Assembly. –
The general assembly shall be composed of such
members who are entitled to vote under the articles of
cooperation and bylaws of the cooperative.
"ART. 32. Powers of the General Assembly. – The
general assembly shall be composed of such members
who are entitled to vote under the articles of
cooperation and bylaws of the cooperative.
"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. The general assembly
shall have the following exclusive powers which cannot be delegate:
"(1) To determine and approve amendments to the articles of
cooperation and bylaws;
"(2) To elect or appoint the members of the board of directors, and to
remove them for cause. However, in the case of the electric
cooperatives registered under this Code, election of the members of the
board shall be held in accordance with its bylaws or election guideline
of such electric cooperative; and
"(3) To approve developmental plans of the cooperative.
"ART. 73. Limitation on Share Capital Holdings.- No member of
primary cooperative other than cooperative itself shall own or
hold more than ten per centum (10%) of the share capital of the
cooperative.
"Where a member of cooperative dies, his heir shall be entitled to
the shares of the decedent: Provided, That the total share holding
of the heir does not exceed ten per centum (10%) of the share
capital of the cooperative; Provided, further, That the heir qualify
and is admitted as members of the cooperative: Provided finally ,
That where the heir fails to qualify as a member or where his total
share holding exceeds ten per centum (10%) of the share capital ,
the share or shares excess will revert to the cooperative upon
payment to the heir of the value of such shares.
ALLOCATION & DISTRIBUTION OF
NET SURPLUS
"ART. 85. Net Surplus. – Notwithstanding the provisions of existing
laws, the net surplus of cooperatives shall be determined in
accordance with its bylaws. Every cooperative shall determine its net
surplus at the close of every fiscal year and at such other times as may
be prescribed by the bylaws.
"Any provision of law to the contrary notwithstanding, the net surplus
shall not be construed as profit but as an excess of payments made by
the members for the loans borrowed, or the goods and services
availed by them from the cooperative or the difference of the rightful
amount due to the members for their products sold or services
rendered to the cooperative including other inflows of assets resulting
from its other operating activities and which shall be deemed to have
been returned to them if the same is distributed as prescribed herein.
"ART. 86. Order of Distribution. – The net surplus of every
cooperative shall be distributed as follows:
"(1) An amount for the reserve fund which shall be at least ten
per centum (10%) of net surplus: Provided, That, in the first five
(5) years of operation after registration, this amount shall not be
less than fifty per centum (50%) of the net surplus:
"(a) The reserve fund shall be used for the stability of the
cooperative and to meet net losses in its operations. The general
assembly may decrease the amount allocated to the reserve fund
when the reserve fund already exceeds the share capital.
"Any sum recovered on items previously charged to the reserve
fund shall be credited to such fund.
"(b) The reserve fund shall not be utilized for
investment, other than those allowed in this Code.
Such sum of the reserve fund in excess of the share
capital may be used at anytime for any project that
would expand the operations of the cooperative upon
the resolution of the general assembly.
"(2) An amount for the education and training fund,
shall not be more than ten per centum (10%) of the net
surplus. The bylaws may provide that certain fees or a
portion thereof be credited to such fund. The fund shall
provide for the training, development and similar other
cooperative activities geared towards the growth of the
cooperative movement:
"(3) An amount for the community development fund,
which shall not be less than three per centum (3%) of
the net surplus. The community development fund
shall be used for projects or activities that will benefit
the community where the cooperative operates.
"(4) An optional fund, a land and building, and any
other necessary fund the total of which shall not
exceed seven per centum (7%).
"(5) The remaining net surplus shall be made available
to the members in the form of interest on share capital
not to exceed the normal rate of return our investments
and patronage refunds: Provided, That any amount
remaining after the allowable interest and the
patronage refund have been deducted shall be credited
to the reserve fund.