Section 4March 10, 1990, Sec./Art. 4

Cooperative Principles. - Every cooperative shall conduct its affairs in accordance with Filipino culture and experience and the universally accepted principles of cooperation which include the following:

(1) "Open and Voluntary Membership": Membership in a cooperative shall be voluntary and available to all individuals regardless of their social, political, racial or religious background or beliefs.

(2) "Democratic Control": Cooperatives are democratic organizations. Their affairs shall be administered by persons elected or appointed in a manner agreed upon by the members. Members of primary cooperatives shall have equal voting rights on a one-member-one-vote principle: Provided however, That in the case of secondary and tertiary cooperatives, the provisions of section 37 of this Code shall apply.

(3) "Limited Interest in Capital": Share capital shall receive a strictly limited rate of interest.

(4) "Division of Net Surplus": Net surplus arising out of the operations of a cooperative belongs to its members and shall be equitably distributed for cooperative development common services, indivisible reserve fund, and for limited interest on capital and/or patronage refund in the manner provided in this Code and in the articles of cooperation and by-laws.

(5) "Cooperative Education": All cooperatives shall make provision for the education of their members, officers and employees and of the general public based on the principles of cooperation.

(6) "Cooperation Among Cooperatives": All cooperatives, in order to best serve the interest of their members and communities, shall actively cooperate with other cooperatives at local, national, and international levels.