BIR Ruling

March 25, 1969 The President Calamba Sugar Planters Cooperative Marketing Association, Inc. 601 Valgosons Building 2228 Pasong Tamo Makati, Rizal S i r : This refers to your letter dated March 20, 1969 stating the following: "This is an inquiry of a cooperative organization as to whether 2 or more cooperative organization organized under Act 3425, as amended may extend services to one another in line of export and import commodities. "It is a known fact that there is a very strict regulation imposed by the Central Bank re importation of various items which one cooperative alone may not be able to shoulder all the finances necessary for different cooperative to import hence, it is necessary for different cooperative to joint together their financial resources to import their members requirements. "May we be inform whether the importation of one cooperative may be shared with by another cooperative purposely to service their respective members. All this cooperative being organized under Act No. 3425 and all are entitled with the same exemption and privileges." In reply, I have the honor to inform you that under Section 34 of Act No. 3425 any association may, upon resolution adopted by its board of directors, enter into all necessary and proper contracts and agreements and make all necessary and proper stipulations, agreements and contracts and arrangements with any other cooperative, corporation or association engaged in any related activity or with any other association formed under the Act, for the cooperative and more economical carrying on of its business or any part or parts thereof. Said Section further provides that any two or more associations, organized under the law may, by agreement between them, unite in employing and using or may separately employ and use the same personnel, methods, means and agencies for carrying on and conducting their respective business. It is clear therefore that cooperative associations are allowed to pool their resources together for their common and mutual advantage and benefit. Accordingly, the importation of one cooperative may be shared with by another cooperative purposely to service their respective members. LLjur Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue