MALACAÑANG
M a n i l aPRESIDENTIAL DECREE No. 2008
FURTHER STRENGTHENING THE COOPERATIVE MOVEMENT BY AMENDING CERTAIN PROVISIONS OF PRESIDENTIAL DECREE NUMBERED ONE HUNDRED SEVENTY-FIVE, AS AMENDED BY PRESIDENTIAL DECREE NUMBERED NINETEEN HUNDRED AND FIFTY-FIVE
WHEREAS, cooperatives constitute institutional vehicles to enhance productivity and increase the income of the people through built-in-mechanisms of economics of scale, costs-sharing and risk-sharing;
WHEREAS, it is vital and necessary for the government to encourage people to organize cooperatives that will provide for their need at the lowest possible cost and at the same time increase their incomes and productivity;
WHEREAS, to strengthen the cooperatives, there is need to restore to them certain privileges which were suspend by PD 1955;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution, do hereby decree:
Section 1. Section 4 of Presidential Decree Numbered One Hundred Seventy-Five, as amended by Presidential Decree Numbered Nineteen Hundred and Fifty-Five, is hereby amended to read as follows:
"Sec. 4. Powers...
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Presidential Decrees
Further Strengthening The Cooperative Movement By Amending Certain Provisions Of Presidential Decree Numbered One Hundred Seventy-Five, As Amended By Presidential Decree Numbered Nineteen H
Presidential Decree No. 2008
Summary of Presidential Decree No. 2008
Powers of Cooperatives:
- Exercise rights and privileges given to persons, partnerships, and corporations under existing laws. (Section 1a)
- Establish and operate business enterprises of all kinds. (Section 1b)
- Establish rural banks and purchase government-held preferred shares of rural banks under rules of the Monetary Board and Agrarian Reform Fund Commission. Registration with the Bureau of Cooperatives Development is sufficient for legal personality without need for SEC registration. These banks are subject to supervision of the Bureau and the Central Bank. (Section 1c)
- Enjoy privileges and incentives granted by the NACIDA Act and other government agencies to business organizations. (Section 1d)
- Petition the government to expropriate idle lands for agricultural production, cottage industry, business, or housing purposes. (Section 1e)
- Own and dispose of property, enter into contracts, sue or be sued, and perform other necessary acts. (Section 1f)
Privileges of Cooperatives:
- Exemption from income and sales taxes until December 31, 1991, provided a substantial portion of net income is returned to members as interests or patronage refunds. Cooperatives whose tax exemption expired shall continue to enjoy privileges but not beyond December 31, 1991. Taxable income is the portion after deducting interests and patronage funds to members. (Section 2a)
- Preferential right to supply agricultural commodities produced by members to state agencies administering price stabilization programs in areas where appropriate cooperatives exist. (Section 2b)
- Exemption from the Minimum Wage Law upon recommendation of the Bureau of Cooperatives Development and approval of the Minister of Labor and Employment in appropriate cases. (Section 2c)
- Exemption of securities from the Securities Act, provided they are not speculative. (Section 2d)
- Representation in court by the Provincial or City Fiscal or Solicitor General, except when the Philippine Government is a party. (Section 2e)
- Preferential rights in the management of public markets and lease of public market facilities, stalls, or spaces for cooperatives and their federations. (Section 2f)
- Credit cooperatives and federations are entitled to loans, credit lines, rediscounting of loan notes, and other eligible papers with the Development Bank of the Philippines, Philippine National Bank, Land Bank of the Philippines, and other financial institutions except the Central Bank. (Section 2g)
- The Land Bank of the Philippines shall take steps to strengthen and rehabilitate distressed Cooperative Rural Banks or Cooperative Banks, including interim takeover or management. (Section 2h)
Penal Provisions:
- No person or group other than registered cooperatives shall use the word "cooperative" or its equivalent in the vernacular in its name, except those who have been using it before the promulgation of this Act. Violators shall be fined P10,000 and/or imprisoned for up to 2 years. (Section 3a)
- Cooperative officials who commit offenses punishable under the Revised Penal Code or other laws where the offended party is a cooperative shall be penalized as if they were civil servants, with perpetual disqualification from holding elective or appointive office. (Section 3b)
- State officials not belonging to the Ministry of Agriculture and Food who willfully and unduly interfere with the business activities and internal affairs of cooperatives shall be fined up to P5,000 and/or imprisoned for up to 6 months. (Section 3c)
- Individuals who organize cooperatives to take advantage of privileges or operate them in violation of cooperative principles, or use cooperatives as fronts to evade taxes, shall have their assets in such organizations attached, and the organizations shall be stopped from operation. Upon conviction, they shall be fined P10,000 or imprisoned for 3 years, without prejudice to other penalties. The tax exemption privileges of such cooperatives shall be automatically withdrawn. (Section 3d)
- Cooperative officers, directors, or committee members who fail to give notice, send returns or documents, do or allow required acts, neglect or refuse to furnish information required by the Bureau of Cooperatives Development, recommend or sanction loans for their own benefit, or grant loans to non-members except on the security of their deposits or to members on the pledge of their shares or for the return of shares without resolution of the Board or General Assembly, shall be fined not less than P2,000 upon conviction, without prejudice to other legal remedies and penalties. (Section 3e)
Powers of Cooperatives:
- Exercise rights and privileges given to persons, partnerships, and corporations under existing laws. (Section 1a)
- Establish and operate business enterprises of all kinds. (Section 1b)
- Establish rural banks and purchase government-held preferred shares of rural banks under rules of the Monetary Board and Agrarian Reform Fund Commission. Registration with the Bureau of Cooperatives Development is sufficient for legal personality without need for SEC registration. These banks are subject to supervision of the Bureau and the Central Bank. (Section 1c)
- Enjoy privileges and incentives granted by the NACIDA Act and other government agencies to business organizations. (Section 1d)
- Petition the government to expropriate idle lands for agricultural production, cottage industry, business, or housing purposes. (Section 1e)
- Own and dispose of property, enter into contracts, sue or be sued, and perform other necessary acts. (Section 1f)
Privileges of Cooperatives:
- Exemption from income and sales taxes until December 31, 1991, provided a substantial portion of net income is returned to members as interests or patronage refunds. Cooperatives whose tax exemption expired shall continue to enjoy privileges but not beyond December 31, 1991. Taxable income is the portion after deducting interests and patronage funds to members. (Section 2a)
- Preferential right to supply agricultural commodities produced by members to state agencies administering price stabilization programs in areas where appropriate cooperatives exist. (Section 2b)
- Exemption from the Minimum Wage Law upon recommendation of the Bureau of Cooperatives Development and approval of the Minister of Labor and Employment in appropriate cases. (Section 2c)
- Exemption of securities from the Securities Act, provided they are not speculative. (Section 2d)
- Representation in court by the Provincial or City Fiscal or Solicitor General, except when the Philippine Government is a party. (Section 2e)
- Preferential rights in the management of public markets and lease of public market facilities, stalls, or spaces for cooperatives and their federations. (Section 2f)
- Credit cooperatives and federations are entitled to loans, credit lines, rediscounting of loan notes, and other eligible papers with the Development Bank of the Philippines, Philippine National Bank, Land Bank of the Philippines, and other financial institutions except the Central Bank. (Section 2g)
- The Land Bank of the Philippines shall take steps to strengthen and rehabilitate distressed Cooperative Rural Banks or Cooperative Banks, including interim takeover or management. (Section 2h)
Penal Provisions:
- No person or group other than registered cooperatives shall use the word "cooperative" or its equivalent in the vernacular in its name, except those who have been using it before the promulgation of this Act. Violators shall be fined P10,000 and/or imprisoned for up to 2 years. (Section 3a)
- Cooperative officials who commit offenses punishable under the Revised Penal Code or other laws where the offended party is a cooperative shall be penalized as if they were civil servants, with perpetual disqualification from holding elective or appointive office. (Section 3b)
- State officials not belonging to the Ministry of Agriculture and Food who willfully and unduly interfere with the business activities and internal affairs of cooperatives shall be fined up to P5,000 and/or imprisoned for up to 6 months. (Section 3c)
- Individuals who organize cooperatives to take advantage of privileges or operate them in violation of cooperative principles, or use cooperatives as fronts to evade taxes, shall have their assets in such organizations attached, and the organizations shall be stopped from operation. Upon conviction, they shall be fined P10,000 or imprisoned for 3 years, without prejudice to other penalties. The tax exemption privileges of such cooperatives shall be automatically withdrawn. (Section 3d)
- Cooperative officers, directors, or committee members who fail to give notice, send returns or documents, do or allow required acts, neglect or refuse to furnish information required by the Bureau of Cooperatives Development, recommend or sanction loans for their own benefit, or grant loans to non-members except on the security of their deposits or to members on the pledge of their shares or for the return of shares without resolution of the Board or General Assembly, shall be fined not less than P2,000 upon conviction, without prejudice to other legal remedies and penalties. (Section 3e)