The Philippine Senate has approved on third and final reading a revised Cooperative Code that would allow limited participation by certain foreign nationals and expand tax exemptions for qualified cooperatives.
Senate Bill No. 1431, or the Revised Cooperative Code of the Philippines, received 18 affirmative votes and no negative votes on September 28. The measure is intended in part to encourage foreign investment and modernize rules governing cooperatives.
Under the proposed changes, natural-born Filipinos who became citizens of another country, as well as children of Filipino citizens who were naturalized abroad, would be allowed to join primary cooperatives as associate members.
The bill also proposes tax exemptions for agricultural cooperatives and for non-agricultural cooperatives with reserve funds of up to P50 million. These provisions are intended to provide greater financial flexibility for qualified cooperative organizations.
However, the measure drew reservations from Senator Risa Hontiveros, who raised concerns about provisions covering cooperative voting rights, tax exemptions and foreign ownership. She also expressed concern over proposed penal provisions, noting that some groups have used the term “cooperative” in scams despite the large number of legitimate cooperatives operating in the country.
Senate President Sherwin Gatchalian reportedly committed to addressing the concerns during the bicameral conference committee discussions.
The Senate approval moves the measure forward as lawmakers work to update the legal framework for cooperatives while balancing investment opportunities, member protections and regulatory safeguards.
