SEC. 9. Section 16, paragraph (j) of Presidential Decree No. 269, as amended, is hereby further amended to read as follows:
“SEC. 16. Powers. – A cooperative is hereby vested with all powers necessary or convenient for the accomplishment of its corporate purpose and capable of being delegated by the President or the National Assembly when it comes into existence; and no enumeration of particular powers hereby granted shall be construed to impair any general grant of power herein contained, nor to limit any such grant to a power or powers of the same class as those so enumerated. Such powers shall include, but not be limited to, the power:
“x x x
“(j) To construct, acquire, own, operate and maintain electric subtransmission and distribution lines along, upon, under and across publicly owned lands and public thoroughfares, including, without limitation, all roads, highways, streets, alleys, bridges and causeways. In the event of the need of such lands and thoroughfares for the primary purpose of the government, the electric cooperative shall be properly compensated;
“(j-1) To construct, acquire, own, operate and maintain generating facilities within its franchise area. In pursuance thereof, where an electric cooperative participates in a bid on an existing NPC-SPUG generating facility, its qualified bid shall be given preference m case of a tie: Provided, however, That in cases where there is no other qualified bidder, the lone bid shall remain as valid basis for the determination of the final award subject to the following conditions:
“(a) bid offer is not lower than the valuation of the assets using Commission on Audit (COA) rules and regulations;
“(b) electric cooperative is prepared to fully take over the generation function of the area from the NPC-SPUG; and
“(c) electric cooperative submits its graduation program from the Universal Charge for Missionary Electrification (UC-ME) subsidy.
“x x x.”
SEC. 10. A new section, to be designated as Section 26-A of Presidential Decree No. 269, as amended, is hereby inserted to read as follows:
“SEC. 26-A. Independence of the Board of Directors and Officers of Electric Cooperatives. – To ensure the long-term business and economic viability of electric cooperatives, the management, operations and strategic planning of electric cooperatives shall, as much as practicable, be insulated from local politics.
“Towards this end, no person shall be elected or appointed as an officer or be eligible to run as a board member of an electric cooperative if:
“(a) such person or his or her spouse holds any public office;
“(b) such person or his or her spouse has been a candidate in the last preceding local or national elections;
“(c) such person has been convicted by final judgment of a crime involving moral turpitude;
“(d) such person has been terminated for cause from public office or private employment;
“(e) such person is related to any member of the electric cooperative board of directors, general manager and department managers within the fourth civil degree of consanguinity or affinity;
“(f) such person is a representative of a juridical person; and
“(g) such person is employed by or financially interested in a competing enterprise or a business selling electric energy or electrical hardware to the cooperative or doing business with the cooperative, including the use or rental of poles.”
SEC. 11. A new section, to be designated as Section 26-B, is hereby inserted under Presidential Decree No. 269, as amended to read as follows:
“SEC. 26-B. Fit and Proper Rule. – To ensure that the management and operations of electric cooperatives are carried out with due regard to its economic viability, the NEA shall prescribe, pass upon and review the qualifications and disqualifications of individuals appointed or elected to electric cooperatives and disqualify those found unfit.
“A candidate’s integrity, experience, education, competence and probity shall be considered in determining whether he or she shall be fit and proper to become a director or officer of the electric cooperative.
“For this purpose, the minimum qualifications of a director or officer of the electric cooperative shall be as follows:
“(a) He or she is a Filipino citizen;
“(b) He or she is a graduate of a four (4)-year course;
“(c) He or she is between twenty-one (21) and seventy (70) years old, on the date of election;
“(d) He or she is of good moral character;
“(e) He or she is a member of the electric cooperative in good standing for the last five (5) years immediately preceding the election or appointment;
“(f) He or she is an actual resident and consumer in the district that he or she seeks to represent for at least two (2) years immediately preceding the election; and
“(g) He or she has attended at least two (2) Annual General Membership Assemblies (AGMA) for the last five (5) years immediately preceding the election or appointment.
“The NEA may, after due notice to the board of directors and officers of the electric cooperative, disqualify, suspend or remove any director or officer, who commits any act which renders him unfit for the position.”
SEC. 12. Section 32 of Presidential Decree No. 269, as amended, is hereby further amended to read as follows:
“SEC. 32. Registration of All Electric Cooperatives. – All electric cooperatives may choose to remain as a non-stock, non-profit cooperative or convert into and register as: (a) a stock cooperative under the CDA; or (b) a stock corporation under the SEC, in accordance with the guidelines to be included in the IRR of this Act.
“Such choice shall carry with it the attendant requirements of compliance with the laws and regulatory guidelines governing the respective government agencies having jurisdiction over their registration.
“Regardless of the choice made, the NEA shall have the authority over electric cooperatives, whether stock or non-stock, to require the submission of reportorial requirements as may be necessary relative to their operations as electric distribution utilities including, but not limited to:
“(a) Monthly Financial and Statistical Report (MFSR);
“(b) monthly separate MFSR. Monthly Engineering Report (MER) and barangay and sitio electrification report fear electric cooperatives on grid with isolated area/s served by NPC-SPUG;
“(c) monthly status of barangay and sitio energization and house connections;
“(d) monthly Institutional Services Department (ISD) report;
“(e) monthly Performance Standard Monitoring Report (PSMR);
“(f) monthly summary of complaints received and acted upon;
“(g) monthly report on compliance with the Grid and Distribution Code:
“(h) Monthly Engineering Report (MER);
“(i) quarterly report on power supply contracts;
“(j) annual work plan;
“(k) annual Distribution Development Plan (DDP);
“(l) five (5)-year investment plan submitted annually;
“(m) annual Cash Operating Budget (COB);
“(n) audited financial statements;
“(o) annual Collective Bargaining Agreement (CBA) or Collective Negotiation Agreement (CNA); and
“(p) copy of Capital Expenditure (CAPEX) and Operating Expenditure (OPEX) plans.
“Likewise, the supervisory and oversight functions of the NEA, as may be detailed in this Act and its IRR, shall be applicable to both stock and non-stock cooperatives.
“Electric cooperatives which register with the CDA shall continue to enjoy the benefits under this Act.
“Existing electric cooperatives may likewise opt to register as stock corporations with the SEC; Provided, however, That electric cooperatives registered with the SEC shall no longer enjoy the incentives provided for in this Act.
“Despite the registration of the electric cooperatives under the CDA or the SEC, the NEA shall retain its supervisory and disciplinary power over them in the conduct of its operation as electric distribution utilities.”
SEC. 13. A new section, to be designated as Section 32-A, of Presidential Decree No. 269, as amended, is hereby inserted to read as follows:
“SEC. 32-A. Incentives of Electric Cooperatives. – Consistent with the declared policy of this Act, electric cooperatives which comply with the financial and operational standards set by the NEA shall enjoy the following incentives:
“(a) To be entitled to congressional allocations, grants, subsidies and other financial assistance for rural electrification;
“(b) To receive all subsidies, grants and other assistance which shall form part of the donated capital and funds of the electric cooperatives, and as such, it shall not be sold, traded nor divided into share holdings at any time. These donated capital and funds shall be appraised and valued for the sole purpose of determining the equity participation of the members: Provided, That in case of dissolution or conversion of the electric cooperative, said donated capital and funds shall be subject to escheat; and
“(c) To avail of the preferential rights granted to cooperatives under Republic Act No. 7160, otherwise known as the ‘Local Government Code of 1991', and other related laws.
“As a further incentive, the NEA may prioritize the grant of incentives in favor of electric cooperatives that are managed effectively and efficiently and comply consistently with its mandates and directives.”
Source: Supreme Court E-Library, Republic of the Philippines. Philippine laws are public documents (works of the government).
