The Cooperative Development Authority (CDA), pursuant to the powers vested in it by Republic Act No. 6939, hereby promulgated the following guidelines for the registration of new cooperatives.

SECTION 1. Title. These guidelines shall be known as the Guidelines for the Registration New Cooperatives.

SECTION 2. Policy. It is the declared policy of the State to foster the creation and growth of cooperatives as practical vehicles for promoting self-reliance and harnessing people power towards the attainment of economic development and social justice.

SECTION 3. Purpose. These guidelines are issued to insure that proposed cooperatives are viable and comply with registration requirements, the Code and Policies of the Authority.

SECTION 4. Coverage. These guidelines shall cover all types and categories of cooperatives except those covered by Chapters XI, XII, XIII, and XV of the Cooperative Code (R.A. 6938).

SECTION 5. Definition of Terms. As used in these guidelines, these terms shall be defined as follows:

(a) AUTHORITY - refers to the Cooperative Development Authority.

(b) COOPERATIVE - is a duly registered association of persons with a common of interest, who have voluntarily joined together to achieve a lawful common social or economic end, making equitable contributions to the capital required and accepting a fair share of the risks and benefits of the undertaking in accordance with universally accepted cooperative principles.

(c) REGISTRATION - is the operative act of the Authority granting judicial personality to a proposed cooperative and is evidenced by the Certificate of Registration.

(d) PRIMARY COOPERATIVE - is a cooperative the members of which are natural persons.

(e) SECONDARY COOPERATIVE - is a cooperative the members of which are primaries.

(f) TERTIARY COOPERATIVE - is a cooperative the members of which are secondaries upward to one (1) or more apex organizations.

(g) FEDERATION OF COOPERATIVES - is a cooperative the members of which are primary and/or secondary cooperative engaged in the same line of economic activities whether single or multi-purpose.

(h) COOPERATIVE UNIONS - are cooperatives at the appropriate levels performing non-business functions and which are organized for the purpose of representing the interest and welfare of all types of cooperatives, regardless of the line of business activities.

(i) LABORATORY COOPERATIVES - is one formed and managed principally by minors and which are affiliated with a registered cooperative.

(j) COMMON BOND OF MEMBERSHIP - is a pre-existing condition or conditions which cause individuals to asscoiate, to know each other, to have common objectives and purposes and to work together to achieve such objectives and purposes.

(k) AREA OF OPERATION - means a territory wherein the cooperative operates which may or may not coincide with political boundaries of the country.

(l) SHARE - Refers to a unit of share capital the par value of which is fixed at any figure but shall not be less than One Peso (P1.00) and may be divided into common share capital and preferred share capital.

(m) CREDIT COOPERATIVE - is one which primarily promotes thrift among its members and creates funds in order to grant loans for productive and providential purposes.

(n) CONSUMERS COOPERATIVE - is one the primary purpose of which is to procure and distribute commodities to members and non-members.

(o) PRODUCERS COOPERATIVE - is one that undertakes joint production whether agricultural or industrial.

(p) MARKETING COOPERATIVE - is one which engages in the supply of production inputs to members and markets their products.

(q) SERVICE COOPERATIVE - is one which engages in medical and dental care, hospitalization, transportation, insurance, housing, labor, electric light and power, communication and other services.

(r) MULTI-PURPOSE COOPERATIVE - is one which combines two (2) or more of the business activities of the different types of cooperatives.

(s) BUSINESS FUNCTIONS - shall mean transactions such as but not limited to marketing, distribution, credit, banking, housing, insurance, trading, transportation, utilities, and such other activities and services of the cooperative wherein surplus can be earned by the cooperative.

(t) NON-BUSINESS FUNCTIONS - refer to representation, education, training, audit, research and such other allied services which may be needed by the memberes of other cooperatives.

SECTION 6. Officers Responsible for Registration. (a) The Authority's Extension Offices, within their respective jurisdiction, shall register the following:

1. Primary cooperatives; and.

2. Secondary cooperatives at the city, municipal, and provincial and regional levels.

(b) The Authority's Central Office shall register the following types of cooperatives:

1. Secondary and tertiary cooperatives at the inter-regional and national levels;

2. Cooperatives governed by the special provisions of the Cooperative Code except credit cooperatives.

SECTION 7. Membership Requirements. (a) For primary cooperatives, fifteen (15) or more natural persons who are Filipino citizens, having a common bond of interest and are residing or working in the intended area of operations is required for registration.

(b) For secondary and tertiary cooperatives, at least fifteen (15) cooperatives shall be required for registration; Provided however, That at least five cooperatives may apply for registration with the condition that the secondary cooperative will reach the required number of fifteen (15) member-cooperatives within three (3) years from its registration.

SECTION 8. Capital Requirements. (a) All cooperatives shall be organized with share capital. The authorized share capital of a cooperative shall be provided for in its Articles of Cooperation. At least twenty five percent (25%) of the authorized share capital shall be subscribed by the members and at least twenty five percent (25%) of the subscribed share capital shall be paid by the members upon registration.

(b) The paid up capitalization requirement for primary cooperatives shall in no case be less than Two Thousand Pesos (P2,000).

(c) For secondary and tertiary cooperatives, the required paid up capitalization shall be evaluated based on the activities to be undertaken as per the economic survey submitted.

SECTION 9. Cooperative Name. (a) The word "Cooperative" shall be included in the name of the cooperative, and unless it is duly registered with the Authority, no ornigazation is allowed to use the word "Cooperative" in its business name or title.

(b) For purposes of distinguishing a cooperative from the organizations registered by the Securities and Exchange Commission (SEC), the word "Incorporated" or its equivalent abbreviation shall not be required in the name of a cooperative.

(c) A cooperaive shall not inclued the word "federation" or "union" in its name unless it applies for registration as a federation or union.

SECTION 10. Provisionally Registered Cooperatives. (a) No cooperative shall be registered provisionally or conditionally.

(b) Cooperatives provisionally registered under previous laws shall be registered as new cooperatives after complying with the requirements of the Code for Registration of cooperatives; Provided however, That such cooperatives shall submit a copy of their audited financial statements covering the last fiscal year.

SECTION 11. Registration Documents. For purposes of registration, the following documents shall be submitted to the Authority:

(a) Four (4) copies of the Economic Survey, describing the following.

(1) Organization structure;

(2) Purposes

(3) Economic Feasibility Study;

(4) Area of Operation, specifying which barangay, municipality, etc.

(5) Number of initial members and potential members; and.

(6) Other pertinent data such as all types of cooperatives operating in the area.

(b) Four (4) copies of the duly notarized Articles of Cooperation and the approved By-laws of the cooperative;

(c) Four (4) copies of the Treasurer's Affidavit, stating:

(1) At least twenty-five percent (25%) of the authorized share capital has been subscribed by the cooperators;

(2) At least twenty-five percent of the subscribed share capital has been paidup by the cooperators and

(3) The amount of paid-up capital that has been received by the Treasurer.

(d) Four (4) copies of the bonds required for accountable officers; and

(e) The registration fee, payable to the Authority in cash or in Postal Money Order form.

SECTION 12. Submission of Documents. The documents required for registration may be written in English or the national language of the Philippines.

SECTION 13. Common and Preferred Share. (a) Should the cooperative wish to have common and preferred shares, statements to the effect should appear in the Articles of Cooperation specifying the amount of shares that are to be offerred for common shares and for preferred share, However, it is preferable that only the common share be offered.

(b) Should prefered share capital be included, the rights and privileges of shareholders or preferred shares shall be placed in the By-laws of the cooperative.

(c) Preferred share capital shall not exceed one-fourth of the total authorized share capital of the cooperative. The twenty-five percent (25%) rule on the subscribed and paid-up share capital shall be applicable to the common share capital contribution only.

SECTION 14. Responsibility of Organizing Agencies and/or Individuals. Federations, unions, training centers, non-government organizations, government organizations and/or individuals concerned with the organization and promotion of cooperatives are morally obliged to render assistance in the pre and post-registration of such cooperatives up to the point of self-reliance.

SECTION 15. Certificate of Undertaking. Upon the submission of the economic survey of a proposed cooperative, the chairman or the duly authorized representatives shall be required to execute a certificate of undertaking, in the form provided, to change the name of the proposed cooperative in the event that another cooperative has acquired a prior right to the use of the name proposed.

SECTION 16. Pre-Membership Education Seminar. The conduct of a Pre-Membership Education Seminar (PMES) for new cooperative is not a mandatory requirement for registration. However, the Authority encourages the conduct of the PMES in order to inculcate within its cooperators the basic principles and practices of cooperativism. The regular PMES will be conducted in accordance with the by-laws of the cooperative.

SECTION 17. Common Bond of Membership. The common bond of membership is categorized into four (4). Only one common bond or field will be adopted by the cooperative. The categories are the following:

(a) Residential membership wherein the members are residents or are working within the defined area of operation.

(b) Institutional which is applicable if the field of membership is exclusively for the employees of the corporation, agency, institution or other aggrupation, whether public or private;

(c) Associational wherein the field of membership is exclusively for the members of an association, organization, religious or civic group; and

(d) Occupational which will apply if the field of membership is exclusively for the groups of professsional, such as lawyers, doctors, accountants, engineers or other similar recognized professions.

SECTION 18. Dual Membership. A prospective cooperative shall include in its by-laws a provision not allowing members of existing cooperatives of the same type within the same area of operation to be a member of the proposed cooperative unless they resign from the former.

SECTION 19. Pre-Cooperatives, Samahang Nayons and Other Self-Help Groups Engaging in Economic Activities. (a) Pre-cooperatives, samahang nayons and other self-help groups engaging in economic activities may be converted into cooperatives upon application for registration and the submission of the documents required in Section 11 hereof, Provided, that in lieu of an economic survey, duly audited financial statements by the Audit and Inventory Committee shall be submitted.

SECTION 20. Registration of Amendments. Pursuant to Article 18 of the Code, the following are requirements for the registration of amendments of the Articles of Cooperations and the By-laws of a cooperative:

(a) Four (4) copies of the amended articles/sections conforming to tall the provisions required by law. Amendments shall be indicated by underscoring or otherwise appropriately indicating the change or changes to be made.

(b) All copies shall be duly certified under oath by the cooperative's Secretary and a majority of the board of directors stating the fact that said amendment or amendments have been duly approved by at least two-thirds (2/3) vote of all the members with voting rights.

(c) A fee for the registration of amendments shall be charged payable to the Authority in cash or in Postal Money Order.

SECTION 21. Bonding Requirements of Accountable Officers / Employees of the Cooperative. In order to meet any contingency that may arise in the operations of the cooperative accountable officers/employees of cooperatives shall submit a bond for the faithful performance of their functions in accordance with Articles 14(5) and (57) of the Code and in accordance with the following sub-sections:

(a) The following persons shall be bonded:

(1) Treasurer and Cashier;

(2) Manager;

(3) Warehouseman;

(4) Signatories of checks and other financial instruments; and

(5) Such other persons as may be authorized by the cooperative to act as a custodian of funds merchandise, inventories, securities and other assets of the cooperative.

(b) The following types of bonds are acceptable:

(1) Real Estate Bond;

(2) Cash Bond; and

(3) Surety/Performance Bond.

(c) The amount of the bond shall be based on the initial networth of the cooperative which shall include the paid-up capital, the membership fees and the other assets of the cooperative at the time of registration.

(d) Every director, officer and employee handling funds, securities or property on behalf of any cooperatives shall execute and deliver adequate bonds for the faithful performance of his duties and responsibilities. The board of directors shall determine the adequacy of such bonds.

SECTION 22. Required Period for Approval of Registration.

(a) An application for registration shall be finally disposed by the Authority within the period of thirty (30) days from the filing thereof. Otherwise, the application is deemed approved unless the cause of the delay is attributed to the applicant.

(b) In the case of denial by the Authority, appeal of such denial may be sent to the Office of the President within ninety (90) days from receipt of the notice of denial.

(c) The failure of the Office of the President to act on the appeal within ninety (90) days from the filing thereof shall mean the approval of said application.

SECTION 23. Repeal. All previous circulars and/or guidelines issued by the Authority which are inconsistent with these guidelines are hereby repealed or modified accordingly.

SECTION 24. Effectively. These guidelines shall take upon the approval of the Board of Administrators.

SECTION 25. Approval. Approved by the Board of Administrators on March 17, 1992.