September 1, 2014

DOE DEPARTMENT CIRCULAR NO. DC2014-09-0017

AMENDING CERTAIN PROVISIONS OF

WHEREAS, Section 16 of

WHEREAS, Section 6 of

WHEREAS, on 29 July 2013, the DOE issued

WHEREAS, on 08 January 2014, the DOE promulgated

WHEREAS, since the passage of the amendment, the DOE and NEA has received requests for interpretation of some provisions of

WHEREAS, on 21 July 2014, a public consultation with ECs was held on proposed amendments to clarify provisions of the NEA

WHEREAS, under existing laws and jurisprudence, the Implementing Rules and Regulations may be amended in pursuit to clarify and carry out the objectives of the law;

NOW THEREFORE, pursuant to its authority under the

SECTION 1. Amendments to the The following provisions are hereby amended as follows:

a. Paragraph i. of e of Section 14 of the Rule III is hereby amended to read

RULE III

Electric Cooperatives

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Section 14. Qualifications of a Director and Officer.

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e) He or she is a member of the EC in good standing for the last five (5) years immediately preceding the election or appointment and shall continue to be a member in good standing during his or her incumbency; CEDHTa

For purpose of this that said member has no unsettled or outstanding obligations to the EC whether personal or through commercial or industrial connections of which he or she is the owner/co-owner three (3) months prior to the time of filing of the certificate of candidacy: Provided, That for incumbent members of the EC Board who will seek re-election, unsettled or outstanding obligation shall be deemed to include power bills, cash advances, disallowances (including NEA audit findings) and materials and equipment issuances reckoned from the time of filing of certificate of candidacy. (Amendments in bold)

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b. Section 16 of Rule III is hereby amended to read

RULE III

Electric Cooperatives

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Section 16. Continuing Qualification Requirement. To ensure that the management and operations of the ECs 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 as EC director or officer and disqualify those found unfit.

An EC director or officer, in order to remain as such, must continue to possess all the qualifications and none of the disqualifications throughout his/her term or tenure of office. To this end, no EC Director shall be allowed to stay in office in a hold-over capacity if he/she fails to meet all the qualifications or is deemed disqualified under the two (2) preceding sections: Provided, That for the purposes of this section, members of the EC Board shall be deemed to have no unsettled or outstanding obligation including power bills, cash advances, disallowances (including NEA audit findings) and materials and equipment issuances: Provided further, That at any given time during his membership in the EC, he or she must be totally free of any unsettled or outstanding obligations and/or disallowances with the EC. (Amendments in bold)

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c. A new section is hereby added as Sections 16-A of Rule III as follows

RULE III

Electric Cooperatives

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Section 16-A. Continuity of Board of Directors. The NEA shall direct the holding of elections of ECs for the disqualified board seat/s or instances where there are no qualified candidates within thirty (30) days from the disqualification of the director or from the failure of election.

To ensure the smooth operations of ECs, the NEA may appoint Interim Representatives to the EC Board of Directors to serve in place of any disqualified director. The NEA may likewise appoint Interim Representatives within the district to the EC Board of Directors in instances of failure of election or where there are no qualified candidate for director after the holding of one regular and one special election: Provided, That Interim Representatives appointed under this sections shall hold office for a term of not less than six (6) months but not more than one (1) year or until the election of a qualified director whichever comes first. (Amendments in bold)

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SECTION 2. Separability Clause. If any provision of this Circular is declared invalid or unconstitutional, the other provisions not affected thereby shall remain valid and subsisting.

SECTION 3. Effectivity. This amendments in this Circular shall take effect immediately from its publication in at least two newspapers of general circulation and shall remain in effect until otherwise revoked.

Issued in Energy Center, Bonifacio Global City, Taguig City on September 1, 2014.

(SGD.) CARLOS JERICHO L. PETILLA
Secretary