The Governance Commission is now supervising the United Coconut Planters Bank (UCPB) until it is finally privatized.
In a statement on Monday, the commission said is exercising its authority over UCPB as a government- owned and -controlled corporation (GOCC), in line with the GOCC Governance Act of 2011.
The sale of government’s 73.9 percent stake in UCPB, valued at P1.1 billion, was stopped by a temporary restraining order (TRO) issued by the Supreme Court in June last year.
The TRO would not be lifted under the Aquino administration, according to the Privatization and Management Office (PMO). Such an assessment of the situation has prompted the Governance Commission to take over and supervise the bank until the next administration takes over after the May elections.
UCPB was under the supervision of the Presidential Commission on Good Government (PCGG) by virtue of a memorandum of agreement (MOA) between the PCGG and the Governance Commission, considering that PCGG was still overseeing litigations that involved the bank.
The privatization of UCPB was approved by President Benigno Aquino 3rd in January 2012 on heels of a Supreme Court ruling that pronounced the bank as a GOCC.
Executive Order No. 179, which approved the privatization of the bank, emphasized that the proceeds from the privatization of UCPB would be used by the government for the benefit of coconut farmers.
The privatization was stopped by the SC after the Confederation of Coconut Farmers’ Organizations of the Philippines Inc. contested the move as tantamount to denying the coconut farmers of their rights over the coconut levy funds.
“Until the privatization is implemented, UCPB remains a GOCC that must comply with the corporate governance requirements of R.A. No. 10149, among others,” the Governance Commission said.
It said the supervision of UCPB as a GOCC will be done gradually over a two-year transition as the bank has been operating as a private corporation. The transition intends to allow any possible resolution of the TRO before implementing major changes in the internal governance setup of UCPB.