Reforms afoot to speed up transport koop building


THERE are still several policy bottlenecks preventing the faster conversion and registration of transportation associations into cooperatives, but, at least, consultations are now being done to simplify procedures in support of government’s public-utility vehicle modernization program.

Surge in koops from jeepneys. Transportation Undersecretary Anneli Lontoc stressed the need for various reforms in the registration process of transport cooperatives as the Department of Transportation (DOTr) expects a surge in demand for cooperatives within the three-year transition period of the modernization program, which requires an industry consolidation, giving transport groups three choices—a corporation, consortium or a cooperative.

Big bus operators are already structured as corporations, while small bus operators can merge into consortiums or joint ventures. Definitely, jeepney operators, who own only one to three units, with many as operator-driver themselves, have no choice but to go koop. Only a handful has five or more units.

Koops are also a logical choice as Republic Act 9520, or the Cooperative Code of the Philippines, designed to empower marginalized sectors, provides koops with many privileges, from tax exemptions, duty-free importation, access to financing and for transport koops, preference in securing franchises, management of transport terminals, etc.

CDA created own bottlenecks? Unfortunately, registering cooperatives is tedious as getting schedules for premembership seminars alone takes two to three months after the Cooperative Development Authority (CDA) idiomatically painted itself into a corner, or put itself in a regulatory straitjacket when CDA Chairman Orlando Ravanera issued Memorandum Circular 2017-02 on February 1, declaring only CDA can exclusively give these seminars.

Previously, local government units (LGUs), with their Cooperative Development Offices (CDOs), were authorized to conduct these seminars as part of devolution, and reinforced further by former President Fidel V. Ramos’s Executive Order (EO) 96, mandating all LGUs to promote and register koops for the poor. EO 95 mandates all government offices to assist koops.

CDA may be violating EO 96 by centralizing seminars. Worse, it has specified the frequency it conducts seminars “at once a month at the CDA Extension Office and once per quarter at CDA Field Offices”, which leaves little flexibility. With this ruling being untenable, the Manila Extension Office holds weekly seminars, and plans to increase it to twice a week with the expected rising demand.

Regulatory brakes slowing registration. Almost repeating what CDA does is the DOTr’s Office of Transport Cooperatives (OTC), which conducts almost the same seminar, called Cooperative Education and Transport Operations Seminar (Cetos), that is also difficult to schedule. As OTC does not have offices nationwide and has limited personnel, it wants its seminars held at its central office.

CDA and OTC do not seem to harmonize their interpretations of rules, thus causing confusion. Some OTC personnel demand prior accreditation with OTC before registering with CDA, but how can one be accredited without becoming a koop first?

CDA allows koop founding officers and members to echo the seminars to their members, while OTC demands every member undergoes Cetos seminars, which is difficult as OTC wants seminars held weekdays, during office hours, which are peak hours for drivers.

Go developmental, not regulatory. CDA Director Abad Santos admits the existence of procedural bottlenecks and the need for institutional convergence with the DOTr.

CDA Administrator Nelon Alindogan said, “The strength of the koop sector cannot just be ignored because of its huge contribution to the economy.”

“As of 2015, the koop sector had a total membership base of about 15 million people, including their families, involving some 25,611 registered cooperatives, a combined asset base of P148.56 billion, and gross revenues of about P27.586 billion,” Alindogan said.

In terms of employment, he added that the koop sector generated a total of 520,760 in direct employment, and 1.923 million in indirect jobs.

On accusations koops are used by some individuals to evade taxes because of the koop’s tax-exemption privileges, he said, “This is not entirely true as the entire Koop sector paid a total of over P3.951 billion in taxes in 2015.”


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